Skills paradox hits NBN Co, but could Libs do better?

Summary:A Coalition NBN would remove much of the construction work associated with the project, but would it cure the project of its skills ails?

One of the difficult paradoxes of the recent furore over the shortfalls of the Labor-led NBN Co emerged when the NSW Business Chamber recently reported that it is fielding complaints from contractors over the "extremely poor" rate of pay and the "poor logistics" of many NBN Co subcontracting companies.

This raises many questions, but the most pragmatic among them are clear: How can NBN Co improve the situation now, and how might the Coalition overhaul the terms of its mooted industry engagement to ensure that its fibre-to-the-node (FttN) network can be delivered by the same subcontractors, to tighter budgets, and with all the rhetorical fanfare accompanying its best-case alternative National Broadband Network (NBN) policy.

As to the existing policy, contractors have blamed the shortfall on "piecemeal" contracts that make it hard to justify the costs of sourcing and training new staff. In turn, those staff would logically be reluctant to commit the time and energy to being trained if they can't be guaranteed of a long and profitable engagement with the subcontractor.

That situation, however, is unlikely to change for a number of reasons — not the least because of reports that employee pay is "extremely poor", and that NBN Co has had to step in to fund training in order to ensure that there are enough skilled employees out there to build the NBN.

Direct intervention like this is a bit worrying: It's the equivalent of giving a four-year-old a pair of scissors, stepping back, and then quickly grabbing them after he seems to prefer waving them in the air around his peers than using them to cut out his paper stars. It's not exactly how things are supposed to work, and while you want to let him find his own motivation, you know it's not likely to happen that way.

If Labor — putatively a friend to workers and the unions whose members are building the NBN — cannot deliver the training and staffing outcomes required to complete the project, how in the world will the big business-friendly Coalition do any better?

The government — through NBN Co — could help fix this, of course, by not only tightening its oversight of NBN Co subcontractors, but by offering more appealing commercial terms to contractors. In this particular case, however, "more appealing terms" would probably imply longer contract terms — which would, if contractors' complaints are fair, justify a greater training expenditure.

Yet that sort of behaviour has been explicitly ruled out by Stephen Conroy, who continues to argue that NBN Co is and will continue to maintain a commercially responsible position. That position is clear: NBN Co will not stuff the pre-election pipeline with longer-term contracts than normal, just to ensure the project's longevity after any possible Coalition victory.

Similarly, the company cannot not extend the duration of its contracts just to convince its own subcontractors that they should invest in adequate training and salaries to fulfil their contracts; they really should have thought of all that before they signed the contracts, committing themselves in no uncertain terms to taking part in a massive infrastructure-building project.

These are professional subcontractors, and the whole reason they've been brought in was so that NBN Co wouldn't have to manage the project with its own workers; in this light, NBN Co intervention is at cross purposes to its goals — and must be recognised as such by the company's detractors.

Whomever Malcolm Turnbull installs as NBN Co CEO after the increasingly-likely ousting of Mike Quigley, will inherit a raft of troubles ... This will most definitely involve tough conversations with existing subcontractors, and an expectation that NBN Co become much tougher with those subsequently engaged to deliver the Coalition's FttN policy.

All of this difficulty raises another, very significant question: If Labor — putatively a friend to workers and the unions whose members are building the NBN — cannot deliver the training and staffing outcomes required to complete the project, how in the world will the big business-friendly Coalition do any better?

Whomever Malcolm Turnbull installs as NBN Co CEO after the increasingly-likely ousting of Mike Quigley, will inherit a raft of troubles as he or she works to root out inefficiency, waste, and rorting in order to turn around the Good Shop NBN. This will most definitely involve some tough conversations with existing subcontractor, and an expectation that NBN Co become much tougher with those subsequently engaged to deliver the Coalition's FttN policy.

However, FttN requires yet another set of skills to that of fibre to the premises (FttP), which will require yet more fundamental adjustments amongst industry participants — and involve a training lead time that Turnbull does not seem to have factored into his claims of a faster FttN delivery.

Indeed, a shift in broadband policy would leave existing subcontractors with their own catch-22: how can they invest heavily in FttP skills to complete their existing obligations with the knowledge that those skills will become obsolete once the existing contracts are complete, and they then find themselves tendering for FttN work instead?

Turnbull may be planning to resolve this issue by simply engaging Telstra's existing field workers to build his NBN — he does seem to be taking Telstra completely for granted as he spruiks his anti-NBN project — but something tells me they might prove to be busier with other projects than he now thinks.

If this proves to be the case, the yawning skills gap could prove to be as much of a bugbear for the Coalition's NBN as it has been for Labor's — and it could quickly blow out Turnbull's projected completion dates as the Coalition's incredibly ambitious and optimistic delivery timeframes meet the ponderous reality of Australia's labour market.

What do you think? Will NBN Co intervention get subbies' training investments back on track? Will a change to FttN engender a training disaster? And can the Coalition stimulate the necessary training investments where Labor has failed?

Topics: NBN, Government : AU

About

As large as the US mainland but with a smaller population than Texas, Australia relies on ICT innovation to maintain its position as a first-world democracy and a role model for the developing Asia-Pacific region. Award-winning journalist David Braue has covered Australia’s IT and telecoms sectors since 1995 – and he’s as quick to draw le... Full Bio

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Related Stories

The best of ZDNet, delivered

You have been successfully signed up. To sign up for more newsletters or to manage your account, visit the Newsletter Subscription Center.
Subscription failed.