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Why can’t the nation own the NBN?

The NBN rollout has now been exposed for the debacle that it is. The ABC’s Four Corners program on Monday night saw to that. It is all about money, federal government, currency-issuing money and the miserly, mean-spirited approach to cutting edge technology by the Coalition.

We were told by the experts that the state-of-the-art infrastructure build that would take us into the 21st century was unaffordable in its original form. Minister for Communications, Mitch Fifield said it would be “fit for purpose”, a code for “not great, but good enough,” if ever there was one.

What small-minded cretins we have in government. What ignorance! The NBNs affordability has been being calculated in dollars, when it should have been calculated in available resources. As the currency issuer, it costs us nothing!

Little wonder NBN boss Bill Morrow looked so sad when explaining the dilemma to Four Corners.

We are a currency-issuing nation. We can afford anything that is available for sale in our own currency. Yet here we have a government that has wrecked a world class communications project on the strength of its false costing.

Not only have they wrecked it, they can’t even complete the wreckage on time. Malcolm Turnbull assured us it would be complete by 2016. Now, it will be 2020 and the coalition’s original costing has ballooned way beyond that which it touted back in 2013.

Let us clarify who is at fault here. The wreckage can be laid squarely at the feet of Malcolm Turnbull, who as Communications Minister, under instructions from the then prime minister, Tony Abbott, undertook to diminish the integrity of a fibre to the premises connection.

If we are to believe what former PM, Kevin Rudd said, the downgrading of the NBN was to protect Rupert Murdoch’s Foxtel from what a fibre network would offer its competitors, namely Netflix and Stan.

Introducing a multi technology mixture of fibre and copper wire to complete the project would be like Australia Post deciding that they would no longer deliver letters, leaving us to collect them at our local post office.

A further complication to what should have been a simple administrative procedure, the NBN is charging internet providers for bandwidth. Other countries do not.

Why does this project have to pass a business case? Why is the bandwidth not being provided free of charge? Why can’t the NBN be a publicly owned facility providing bandwidth free to ISPs?

Why can’t the nation own the NBN? And when was it ever about a deadline and cutting corners to achieve it? The original fibre to the premises plan was the right choice and the monetary cost should never have been a consideration.

Blaming Labor for this debacle has made Malcolm Turnbull look small. He knows only too well, the mess is his to own.

Modelling the NBN as a going concern that would be put up for sale at an appropriate time was another mistake. It should be owned by the people.

This monumental cock-up has been exposed for what it is: a neo liberal inspired, wealth creation opportunity for some individuals or groups who would make billions of dollars at the expense of the rightful owners.

It needs to be fixed now. If it isn’t, it will have to be done sometime in the future. The fibre to the premises plan set down by Labor in 2008 can be revived.

The remaining rollout can be completed with FTTP. To have one side of a street with fibre and the other side a copper wired connection as exists today in Dubbo, and doubtless elsewhere, is utterly laughable.

So many of our publicly owned assets have been sold off for no measurable return. It’s time we started owning them again.


47 comments

  1. babyjewels10

    How is it that this government has decided all government services, all government infrastructure, should be sold? Who does this crazy stuff?

  2. Shogan

    The big problem is that Telstra as a whole should never have been privatised…instead it should have remained the sole communications infrastructure builder, provider & wholesaler & then let the public service providers fight for market share…that way we would have had the best communication infrastructure in the world & real competition in the market place.

  3. Jaquix

    I understood the NBN was a government owned entity (or something) If it has no shareholders, surely we then are the owners of it? It must belong to someone!

  4. OPPOSE THE MAJOUR PARTIES

    Howard’s privatisation of telstra is the big problem. telstra should have been broken up into retail and wholesale – the poles and wires – and the retail could have been sold but the wholesale maintained in public hands. Public telstra could then have built the broadband network by replacing its own network. there is only one positive from the LNP mismanagement of the NBN – the money obtained for the sale of telstra is still in the future fund. use that to rebuild the system. the network will pay big dividends when operational.

  5. John Boyd

    The big problem for a Labor government is that repairing the damage, not only to the NBN, but the environment, water management, electricity supply and so on, will take time. These things can be wrecked in weeks by appalling decisions such as we have seen, but will take years to repair.

  6. Robert REYNOLDS

    I could say much in response to your article John. However, all I would really be doing is to repeat what you have said but in my own words. Suffice to say, I agree 110% with your comments. Well said!!

  7. Tony Webster

    This government has a majority of just one seat and that is currently in doubt by Joyce’s country of birth. How can they continue to make these acromonious decisions in our name and not be called out by the opposition. We need a Federal ICAC now… The NBN is criminal and Turnbull/Abbott should be charged.

  8. Harquebus

    “We are a currency-issuing nation. We can afford anything that is available for sale in our own currency.”
    Fly me to the moon.

    The NBN was a cock up from the start when, that moron Conroy with no experience in networking, thought that he could design and build a state or the art network. It has been further cocked up by the Coalition who, only see it as an asset to be sold off.

    “So many of our publicly owned assets have been sold off for no measurable return. It’s time we started owning them again.”
    Could not agree more. Vital infrastructure does not belong in private hands.

  9. Frank Smith

    I posted the following comment on Rossleigh’s article related to the NBN yesterday:

    “Yes, privatising the network and assets arm of Telstra was utterly stupid as it then precluded the major Government owned Telco, which owned that infrastructure, from just enhancing it to deliver the National broadband network that NBN is now trying to cobble together. NZ and UK got out of this mess by splitting their major Telco into a retail arm and a network asset arm. They then used their Telco’s asset arm to deliver their fast National broadband systems. With our inferior NBN not delivering what many want at an affordable price and technologies like 5G wireless about to offer stiff competition, whichever Government is in power at the time may find that the best solution will be to similarly split Telstra and turn the National Broadband infrastructure build and maintenance back over to them. And that would be truly ironic.”

    I guess the only thing that I would add today is ask those who know a lot more about corporate law than I do whether it would now be possible to unscramble Telstra into retail and network enterprises after that lying rodent Howard opened the privatisation gate and encouraged it to escape.

  10. Ross

    Malcolm just told us what everybody already knows, privatising publicly owned assets is not about providing services to the public it’s all about profit.
    That the public has never once profited from the sale of any of the assets we once owned has never been part of the equation.
    Didn’t you know, public ownership of the NBN or anything else is sacrilege to the cult of neoliberalism currently being practiced in Australian parliaments.
    It’s the economic voodoo that they do so well.

  11. John Kelly

    Jaquix, the NBN is currently a government asset, but the intention is to sell it off when the network is complete.

  12. Winston

    In the end you would have to conclude that The Conservatives (LNP) are amoral in every way. Well dressed wolves in tailored suits.Their souls; like vial pigs in well feed trough’s.Arrogant self interested blood sucking vampires on the teat of what fed them in the first place.Yet they will forever refuse to admit it.God have mercy on their souls.The damage they have done is irreversible.

  13. Michael

    Let’s get this straight – It’s MBN not NBN – M for Malcolm – Malcolm Broadband Network – and while we are at it, agile innovation and innovative agility produced the MEG – Malcolm Energy Guarantee, not NEG.

    Not only was Mal, who some say pioneered the internet, was the Minister in charge, lap dogging Abbott’s bidding but did so so willingly and enthusiastically primarily to spitefully put but the boot into Labor.

    And now cowardice has surfaced shotgunning all and sundry except, of course, the delusional man himself – we have yet to see whether we get to hear “Labor made me do it”.

    Isn’t it time we cut the bullshit and strengthened whistleblower protection to sweep the floor clean?

  14. economicreform

    John Boyd, I think Labor supporters need to face up to an ugly reality. The blame for privatisation cannot be sheeted home entirely to the intentions and designs of the Conservative parties. The drive for the privatisation of public assets and utilities, the Commonwealth Bank, etc began under the Hawke and Keating governments. The reality is that both of the major party groupings have attempted to implement the major features of the neoliberal agenda, and the privatisation of public assets is but one part of a wider agenda designed to redistribute wealth and income upwards. Labor is currently a neoilberal party, and therefore the party cannot be relied upon to implement any of the major reforms that most of the readers of these columns recognise are necessary in order to re-establish a decent, healthy and happy society.

  15. Alan Luchetti

    “the money obtained for the sale of telstra is still in the future fund” writes OPPOSE THE MAJOUR PARTIES above.

    Our federal government is a currency issuer. It creates money when it spends. It does not need a supply of notional dollars in a future fund spreadsheet, or a consolidated revenue spreadsheet, any more than QANTAS needs a supply of frequent flyer points before it can issue them.

    All the future fund does is perpetuate the false notion that a currency issuer needs “revenue” or “borrowings” in order to spend. That it needs to save for a rainy day. That its “debt” will burden our grandchildren. It is that false notion – one shared by Costello and Rudd and the Greens and One Nation and Xenophon and 99% of economic punditry – which allowed the non-issue of the NBN’s cost to become the Abbott/Turnbull/Murdoch weapon to mutilate it.

  16. Robert REYNOLDS

    Winston, the LNP and the ALP are both there in parliament to represent the interests of capitalism. To expect either of these political parties to behave in any other way than the way that you describe, is totally unrealistic.

  17. Robert REYNOLDS

    “Right on the money”, economicreform! I could not have put it better myself!

  18. Winston

    Robert Why must they behave like this? Selling of your house, your farm your assets to the worlds highest bidder in the name of Capitalism is unpatriotic and short sighted.It’s all about greed and serves only the wealthy.It is Extreme Capitalism, ideology that upsets me.

  19. Robert REYNOLDS

    Because Winston, the capitalist is not concerned in the slightest with patriotism, ethics of morals. These things play no part in their decision making unless there are likely to be legal ramifications and even then, the capitalist will often take a chance on not being caught. The only consideration that concerns them is making a profit and no profit is ever big enough.

    I think that it was Lenin who quipped that if the capitalist was in jail in the evening awaiting to be hung in the morning, then they would sell the rope to the hangman if they could make a profit.

  20. Winston

    Not sure that is a great quote.As it points to The Capitalist’s smarts.As there would no rope to hang him in the morning would there? And the hangman is not going to admit he bought it? So your saying Capitalism sucks?

  21. Warwick O'Neill

    Econmicreform – well said. By ignoring half the problem, there will never be a solution. Relying on/hoping that the ALP will fix it all when they get a crack at it will only end in tears, because they won’t fix it. They haven’t in the past when they had the opportunity, they continued the sell-off. And that just hands the advantage back to LNP, who get voted in the next time and the cycle repeats. How do we break that cycle with the current political system that we’re stuck with? I don’t know.

  22. John

    I agree with John Menadue that the blame for the NBNs woes can be laid at the feet of Howard who sold Telstra as a package for short term political gains rather than splitting its retail and infrastructure arms.

    He quotes Brad Orgill, a director of NBN sacked by Malcolm Turnbull when he became Minister of Communications in the Abbott Government, ‘The privatisation of Telstra’s wholesale business was clearly a mistake. If its wholesale business had continued as government-owned there would be no need for NBN and replacement of copper with fibre would have been progressively undertaken, as has happened in the rest of the world by an established incumbent operator with substantial advantages in resourcing, access and intellectual property. NBN illustrates the risks of privatising natural monopolies.’

    https://johnmenadue.com/john-menadue-the-wholesalenetwork-arm-of-telstra-should-never-have-been-sold/

  23. Nexus321

    economicreform – that is true as the neoliberal economic nuttery has infested both parties. The notion that everything is a market is absurd. They are totally destroying ‘public goods’ and the ‘commons’. We need to fundamentally change this thinking as the future will be very grim indeed. Our national competitors will take advantage of the inability to think strategically from a national perspective.

  24. Winston

    Robert How did The Capitalist get hold of the rope ?

  25. Jason Howe

    it has been since malcolmwas elected to the comms minister position

    to the point mtm i only valid for less than 2000 meters of copper cable for vdsl use the reality of 10 gigabit or more is ls than 70 meters and looking who owns the media business in print/tv/radio/pay tv bulk is owned by the murdoch/packer/stokes empires, and whilst there is not fair reporting in tthe media we will never see a telecommunications upgrade for service..

    a 3step process of fttn/fttc-fttdp/fttp is just wasting money

    note whilst we still got idiots in control of nbnco we deal with a firesale scenario and nothing changing for the next 20-50 years!!!!!!!!!

  26. Phil

    Blame fixes nothing and changes nothing. The LNP has had responsibility for the NBN since 2013 election – it has made a monumental cock up of the NBN and everybody knows it. Thus having made a monumental cock up of every other policy area, the government now has only a few weapons left with which to defend itself – scapegoating is one. Lying is another. Attack is also a useful diversionary tactic and this is exemplified by the AFP raids on the Victorian office of Turnbull’s arch enemy the AWU fits in.

    These are the actions of a government that is haemorrhaging.

  27. Harry

    Spot on John and great to read another perceptive article of yours!

    Most of us want well-resourced health, education and social support for the aged, the disabled etc., with modern, well maintained public infrastructure such rail, roads, NBN, NDIS etc. We want it but we do not get it and most of the above are chronically underfunded or not funded at all.

    Why? Because we are told the money is not there to do this. And this stumbling block will be a permanent snag as long as we are stuck with the idea that the federal budget must be funded by taxes and that we must not have continuing budget deficits as this will run up enormous debts and the country will essentially end up bankrupt.

    This is utter nonsense as the federal government is NOT like a household. It’s spending is limited only by the productive capacity of the economy, unlike you and I who have to ensure we have enough dollars in our wallets, our bank account and our credit limits.

    We do not have a spending problem nor do we have a revenue problem that needs more taxes, either from the well off or heaven forbid, from the poor. But we do have an economy that is not being run at a level that will provide employment for all who want to work.

    Slogans like “work, invest and save” may be fine words but in the absence of sufficient stimulus spending employment will not be soaked up. Attempts to reduce the budget deficit by cutting spending will take money out of the economy and reduce demand. Reduced demand results in employers cutting their workforce and the government will have to spend more on welfare, not less.

    The budget deficit is irrelevant to the main aim of the economy providing enough work for all. When we reach that state the budget deficit will shrink naturally.

    https://era-blog.com/2016/12/05/paying-for-public-services-in-a-monetary-sovereign-state/

  28. helvityni

    Indeed John, it’s Mal’s mess, when watching Four Corners, I almost felt sorry for Bill Morrow. So far Mal has to taken responsibility over anything….

  29. Jordan Grant

    John lord – thank you for trying to bring mmt principles into the public discourse, but I do think Labor has to wear some of the blame for this debacle. There’s a reddit ama starting now with Kevin Rudd and this was my question (note I didn’t bring up the fiat currency / mmt aspect purely because Rudd was very much neoliberal lite and I thought it would distract from the main issue….) :

    Kevin, overall I think you did an outstanding job, but I have to ask – why did you insist that nbnco generate a commercial ROI with a view to privatisation within 5 years of completion???

    It’s abundantly clear that privatisation of essential services and/or natural monopolies has been a complete failure (power prices, telstra anyone??). The nbn could and should be retained in government ownership, this would have allowed a much longer payback period, eventually created a revenue stream for the government, and in turn would have negated the need for the expensive cvc charges which are almost the sole cause of rsps under-provisioning bandwidth and causing congestion at peak times which is one of the main drivers of complaints about the network.

    What Abbott and turnbull have done to it is nothing short of treasonous, but I’d be curious as to your reasons for the privatisation goal and whether you now feel that was a mistake

  30. Robert REYNOLDS

    Winston, as I indicated earlier, Lenin’s remark was meant merely as a ‘quip’, or epigram. He did not intend the comment to be taken literally. My interpretation of the comment is that it was made to indicate the overriding and manic obsession that many capitalists have with making a profit.

    I am certainly no fan of capitalism, especially of the neo-liberal variety that much of the west has been subjected to for the last 40 years or so.

  31. Winston

    Robert: I don’t think I am being unrealistic to believe Labor has a little more social conscience than The Liberals.You sound very passionless.

  32. Martin J.

    Hackers complain about low speed of the internet, saying: “With this slow internet traffic you can’t make a meaningful cyber attack, because by the time the worms, malware and virusses have reached the target country they have already updated their systems !?!”
    hehe…on a serious note: any security measure turns into a hackable insecurity in a short time

  33. Robert REYNOLDS

    Winston, I spent 16 years as a keen, card carrying member of the Australian Labor Party. I spent some of that time as treasurer of my local branch, I was involved in letter boxing and handing out voting papers at polling booths at election time. I was on candidate preselection panels on the odd occasion.

    I resigned from the ALP some 35 years ago when the party, under the leadership of Bob Hawke and Paul Keating, adopted neo-liberal, free market economics as its platform. Under the leadership of this duo, the party took steps that even the Liberal Party would have been reluctant to take. In other words Winston, the ALP did the ‘dirty work’ of the Liberal Party.

    I realized then that the message I had been getting from those I knew in The Communist Party of Australia, was true. The ALP did not, and never did have, any intention of ever implementing its then socialist platform. In fact, the ALP, since the changes adopted by Hawke and Keating, now makes the Liberal Party under Prime Minister Robert Menzies, seem like a socialist party in comparison.

    Despite their antics in parliament, the raison d’être of both the Liberal Party and the ALP (Alternative Liberal Party) is to look after the interests of the rich and powerful in this country. No matter which major party wins a general election, the banks, pharmaceutical, oil and telecommunications companies, etc. have nothing to fear.

    You might say Winston, that I sound very passionless, I have heard others express the opposite view.

  34. jim

    Outrageous, “other countries don’t charge for bandwith so wtf are we ?.
    NZ 1TB+ bandwith downspeed and Australia under 4 years of LNP, hasn’t got a quarter of that oh but wait its all Labors fault!! LNP you show us all that you’re grossly incompetent in all aspects of governing Australia you are done,step aside, and save some face.
    And with the smart people inventing farout internety things daily and using brillent 4k + video you LNP say we should be ” Very carefull” blah, blah,blah”, F#$#!! !!ELECTION NOW !!this is bullcrap!!
    ELECTION NOW . KICK THIS MOB OUT!. They’ve sunk the ship.

  35. jim

    Ok 1 Gb +brandwith speed.
    More and more peoples lives will depend/rely on the internet the LNP choose not to see this incompenence at best neglegence Aaaaah.

  36. Michael

    About the only way to appease the masses is to have a few ………………… Royal Commissions ……… to flush the dunny so to speak.

    Let’s think now – what comes to mind? Banks, N(M)BN, N(M)EG, AFP, Murray/Darling, Adani/Carmichael, Ministers’ part-time income ….

  37. win jeavons

    ” fit for purpose” = I despise the Australian idiots who voted us in, This gang shows its contempt for the public and the public good in everything it says or does. Yet we pay them !

  38. John L

    Winston…they are immoral, not amoral! They know well what they do, yet they don’t care.
    Robert, I agree with what you say.. It amuses me when people say Labour is a party of the left .. centre right at best these days, but was as neolib as the worst of them at one time. Perhaps they are now more Social Democrats.

  39. Debbie Tucker

    “Privatization” is how the corrupt, greedy get ENDLESS MONEY.
    Since they understand that the government can issue money with almost NO CONSTRAINTS, whoever runs/owns a system that the government wants them to have but is supposedly ‘for the people’, can then BILL THE GOVERNMENT ANY AMOUNT. Therefore, they bill to get MASSIVE exec salaries and billions in profits!!!
    That is how it works.
    STOP ALL THE PUSH FOR PRIVATIZATION, it is an Orwellian doublespeak word to DUPE the public, and EVERYTHING they say about it is LIES. It is NOT ‘efficient’, does NOT ‘save money’, and is NOT run ‘like a business’. Since the greedy NEVER HAVE ENOUGH, they spend LESS on actually providing a decent product or service so that MORE GOVT MONEY goes into their bank accounts.
    Look no further than where I live – the US defense companies have always been privatized (so we have propaganda to justify constant and MULTIPLE wars for the constant profits of the pathologically greedy), we have a federal prison system owned by the greedy profiteers, and our healthcare insurance is ‘privatized’ – multimillion salaries to the CEO’s and BILLIONS in profits to the companies, sometimes even QUARTERLY their profits are in the billions!!
    THAT is ‘government waste’ – money issued and being HOARDED by the money addicts and sociopaths!!

  40. Winston

    Thanks JL Personally I hated Keating and he has the same self image as Howard.They admit no wrong.And now I can’t believe that Keating is coming out against Euthanasia.Human beings are very odd.It seems the wrong people go into politics.Don’t tell me that Keating is religous?

  41. Robert REYNOLDS

    Thanks for your message of support John L.

    I suspect that if the ALP moderates its support for neo-liberalism then such a revised policy will not be driven by real commitment but only by a perceived shift in public attitude. The ALP is run by opportunists who seem to be driven by focus groups and public opinion as much as their counterparts in the real Liberal Party.

  42. Robert REYNOLDS

    Debbie, I support what you say TOTALLY!! Well said!!

  43. Oscar

    Yes Debbie Australians like taking it up the arse . We can’t wait to embrace it all.

  44. Kronomex

    What I would like to know is will the NBN be sold off for the full price of what the taxpayers are paying for or will it be, most probably, sold at a bargain basement discount? No doubt some foreign corporation(s) will become the new owners.

  45. Florence nee Fedup

    Not worth owning. Very expensive to maintain. Will need to be fibre to premises to be worth owning. Major muck up.

  46. jimhaz

    Personally I would have expected the ALP NBN to have blown out enormously – at least a minimum of 50b over budget and taken longer.

    Mind you that would still be cheaper than the LNP once the hub to home connection is added in. I suspect the economies of scale of doing a block of connections at the same time versus all the waste of time spent by consumers and ISPs to organise connections, then the cost of individualised scoping, equipment supply and transport to and for each separate home being connected over the next 10 or so years. Connection quality and consistency would have also been much improved by a huge factor.

  47. diannaart

    Good point noted, Florence nee Fedup

    NBN worthless as a partially installed service reliant on a mix of dated copper, make shift repairs and shonky contractors paid for quick installation rather than taking care.

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