The Federal Government has proposed providing $17.1 million in additional funding to the Department of Broadband Communications and the Digital Economy for ongoing negotiations with Telstra over universal service obligation (USO).
The additional funding was detailed in budget appropriations legislation introduced by Special Minister of State Gary Gray in the House of Representatives yesterday. Gray said the funding would go to "support the finalisation of definitive agreements between Telstra and NBN Co, and to develop and implement arrangements for the establishment of a new agency to manage the universal service obligation".
The negotiations between the government, NBN Co and Telstra for the $11 billion deal that would see the telco decommission its copper network, lease the ducts and pits to NBN Co and move customers over to the National Broadband Network (NBN) came closer to completion yesterday. The Federal Government and Telstra announced that it had agreed to key terms of the agreement and that the telco had set the deadline of 1 July to take the deal to shareholders to vote on.
Currently, Telstra is obligated under USO to ensure the delivery of standard telephone services, payphones and emergency call handling. Under the agreement it is intended that Telstra would be relinquished from USO to a newly created government-owned entity (currently known as USO Co) in July 2012.
A re-appropriation of $11.8 million from the 2009/2010 budget to the 2010/2011 budget was also sought for the department for the digital TV switchover program. The government cited an advertising campaign and delays in milestone payments for the program resulting in the need for payments to be pushed back in the budget.