Budget 2014: Universal Service Agency functions transferred to Communications Department

Malcolm Turnbull has cited the need to reduce red tape as the reason for the federal government's decision to axe the Telecommunications Universal Service Management Agency (TUSMA).

TUSMA was created in early 2012 by the former Labor government to take on the Universal Service Obligations that were previously vested in Telstra. As the AU$11 billion deal between NBN Co and Telstra structurally separated the former government-owned telco, the agency was formed to ensure reasonable access to standard telephone services across the nation. This included a 20-year AU$230 million contract to Telstra for voice services to areas outside of the NBN fibre-to-the-premise footprint.

"It is anticipated that the telecommunications Universal Service Management Agency will cease as an entity as at 30 June 2015," the budget papers released today said. "Prior to that, however, the functions of TUSMA will be transferred to the Department of Communications."

Turnbull said that the decision to abolish TUSMA would increase certainty by giving the industry a single agency to deal with on matters of telecommunications policy and implementation. The decision will also scrap the AU$1m levy paid by the telecommunications industry to help fund TUSMA.

"TUSMA is a very small agency and bringing this role into the Department will help streamline the delivery of government services," Turnbull said.

The agency was not popular with telcos, as a submission (PDF) prepared by the Communications Alliance in response to the Department of Communications' review of deregulation in the communications portfolio showed.

Representing companies including Telstra, Optus, iiNet, Vodafone, NBN Co, and AAPT, the Communications Alliance said it was unclear why TUSMA was established, given it was only overseeing a small number of contracts.

The government said that its audit into deregulation will be completed by the end of the year, with its findings to be revealed in early 2015.

As well as absorbing the duties of TUSMA, the Department of Communications will also be transferred the duties of the Office of Spatial Policy from the Department of Industry.

"Relocating these functions for facilitating and coordinating spatial data management across Australian government agencies within the Department of Communications will better support both the government’s e-Government agenda and the Department's rollout of the National Broadband Network," the budget said.

The government said both transfers of duties will be performed without any impact on the federal budget.

Despite increasing its remit, the budget papers state that the department is set to loose around 100 jobs, as measured by the budget's average staffing level metric, during the next twelve months.

"The projected decrease also reflects staffing reductions from the winding down or termination of programmes or initiatives including Digital Switchover, NBN Implementation, Satellite Phone Subsidy, and Digital Productivity Programmes, and the alignment of staffing to operate within the allocated budget following implementation of efficiency measures," the budget papers said.