Conroy's NBN train has jumped the tracks

Conroy's NBN train has jumped the tracks

Summary: It's one thing to promote a project on the goodwill of one's peers and critics, but Communications Minister Stephen Conroy is venturing into dangerous territory with his escalating showdown with the rest of parliament. Even worse, the involvement of Prime Minister Julia Gillard suggests Labor is every bit as duplicitous and autocratic as the Coalition alleges.


Who would ever have thought it could come to this, and so quickly? With just a week left until parliament shuts up shop for the year and the Telstra separation legislation halfway home, the rapidly-escalating conflict between Labor and the rest of government now has words like "contempt of Senate" and worse being thrown around an increasingly agitated Senate that tried to gag Stephen Conroy and could well end up blocking legislation out of sheer spite.

It's hardly the result Conroy would have been hoping for as Malcolm Turnbull's efforts at a private members' bill to force greater disclosure were foiled and Conroy's Telstra legislation passed the lower House with no changes. This would normally have been a cause for celebration, yet Conroy faces new problems as the Greens and Coalition band together to compel the release of the NBN Co business plan. Even Julia Gillard has jumped into the fray, supporting Conroy's plan to release that document next month, using the time-honoured approach to slip it into the pre-Christmas news vacuum where it will be summarily ignored, and cannot influence the current Parliamentary debate.

As his fellow senators dig in over the NBN business plan, has Stephen Conroy's luck run out? (Credit: David Braue/ZDNet Australia)

Conroy is clearly hoping to keep the document out of the limelight until after the Telstra legislation is passed, and is counting on the growing desire to resolve it once and for all, to lodge what would be a stunning legislative win just days before the parliamentary session ends. He "understandably" doesn't want to cloud the debate and risk derailing the Telstra legislation as his opponents pick through the report for ammunition to delay the vote past next Thursday.

Yet knowing that Conroy has in his hands but refuses to share a document that could add great clarity to the NBN project, and potentially silence critics once and for all, leaves a bad taste in one's mouth. It's not as though Conroy doesn't have this information, in which case he could be given some leeway. It's there, but he just won't share it. He says he's still processing it, as he did last week when asked about the document at Nextgen Networks' halfway celebrations.

Knowing that Conroy has in his hands but refuses to share a document that could add great clarity to the NBN project, and potentially silence critics once and for all, leaves a bad taste in one's mouth. It's not as though Conroy doesn't have this information. It's there, but he just won't share it.

I have no first-hand knowledge of his reading speed, but Conroy was able to digest the recent OECD report and intelligently evaluate its findings within hours of its release, as well as release his considered opinion that the OECD likes the NBN. The 400-page NBN Co report, however, will apparently take months to digest.

Surely Conroy has read at least the Executive Summary by now? And surely he could release that, as his fellow lawmakers are quite reasonably requesting? Surely, even Conroy recognises that good policy can't be made in an information vacuum.

In dragging his feet, Conroy is making the government look as elusive and disingenuous as its critics have long alleged. Sure, the NBN does require a few leaps of faith, but if Conroy can't proudly show off the actual implementation plan as a model of efficiency, well, that's a problem. He's also marginalising the role of parliament, which is to provide many voices that shape government policy so that individual lone wolves can't railroad through their pet projects. His refusal to release even some of the report suggests the NBN Co business case is indeed loaded with difficult figures that Conroy hasn't yet figured out how to spin; will the network indeed flunk its financials test, as Turnbull alleges Conroy has already admitted?

I am reminded of the joke in which a down-on-his-luck man asks God to help him win the lottery. He prays and prays, but the lottery draw comes and goes and he wins nothing. So he prays some more, but the lottery again comes and goes and still no prize. He once again prays, increasingly desperate, and says "God, why are you ignoring me?" and God appears next to him and says "Meet me halfway here, at least go buy a ticket!"

Citing unknowns, intangibles, and the opportunity cost of backing down on the NBN, Conroy has pushed the rest of parliament to take a whole lot on faith throughout the course of the year, and supporters of change have been none too willing to give him some slack. But there's a fine line between necessary haste and utter disregard, and Conroy has this week crossed it. The current situation is unfortunate for the NBN and dangerous for Labor: Conroy is now in contempt of the Senate, which is a worrying place for any parliamentarian to be in. Contempt of Senate is, if Wikipedia is to be believed, punishable by a fine of $5000 and/or six months' imprisonment.

There's a fine line between necessary haste and utter disregard, and Conroy has this week crossed it ... If the image of Stephen Conroy in prison orange isn't enough to make Malcolm Turnbull's Christmases come all at once, the involvement and support of Julia Gillard paints the whole situation a new shade of outrageous.

As if the image of Stephen Conroy in prison orange isn't enough to make Malcolm Turnbull's Christmases come all at once, the involvement and support of Julia Gillard paints the whole situation a new shade of outrageous. When pressured, Gillard is proving herself every bit as arbitrary and autocratic as she has been accused of being. Her position was tenuous enough after the election, when she said the people had indicated their desire for change in Canberra and that she recognised the need for more consensus-building. Now, just months later, she is becoming complicit in contempt of parliament and open defiance of the lawmakers whose support she will need to get anything done over the next three years?

This is Gillard's chance to show that things actually have changed in Canberra, and that she's prepared to engage other voices to reach a mutually beneficial outcome. It's also her time to decide whether this NBN business plan is worth staking her Prime Ministership on. Apart from the obvious implications of this action, the damage to due parliamentary process, the potential lack of confidence in her Prime Ministership, the potential direct consequences for Conroy in defying a Senate order, and the utter disregard for the supposed promise of transparent government on which Labor was elected, there is the potential for significant damage to the long-term political climate around the NBN.

Surely, Labor has lost much of its appeal to the likes of Greens Party communications spokesperson Scott Ludlam, who is learning firsthand that his party's election-time support of Labor isn't necessarily a two-way street, and showing Labor that the Greens are more than willing to side with the Coalition when they suspect Labor of skullduggery.

Labor has been railroading this project into reality since its beginning an approach which, by the way, is not entirely inappropriate given its complexity, scale, and political contentiousness, but the current situation is politically dangerous all around. Even if the telco reform legislation passes by next week, Conroy's open disregard for parliamentary procedure is going to strain the goodwill upon which the NBN's progress has relied for so long. Conroy has kept supporters on the NBN train with repeated promises of rewards ahead, but his continuing duplicity and, now, open defiance of something that is really quite reasonable, may be the thing that convinces even allies that he's really just taking everybody for a ride.

Topics: NBN, Banking, Broadband, Government, Government AU, IT Employment


Australia’s first-world economy relies on first-rate IT and telecommunications innovation. David Braue, an award-winning IT journalist and former Macworld editor, covers its challenges, successes and lessons learned as it uses ICT to assert its leadership in the developing Asia-Pacific region – and strengthen its reputation on the world stage.

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  • I think they should just release the document ... fast track the cabinet meeting to discuss it and release it Monday. The govt has already offered the independents a private briefing, and really they're the only ones who matter in getting the legislation passed, so does it really matter if the Coalition get to see it earlier as well?

    I have no problem with them removing commercially sensitive information from it as long as they don't go overboard.
  • There are quite a few good reasons why the Government might want to take a few weeks to go through the report before releasing it. The "commercial-in-confidence" bits are likely quite real, and not just a reason for arbitrary delays.

    Having dealt with quite a few government reports in my time, I know the need to be across all aspects of highly contested issues. The Government has a right to be prepared for answering tricky issues, or explaining sections that may be susceptible to misinterpretation (or outright misrepresentation).

    Still, no more than a few weeks should be needed. I do think that the release should be expedited - for sheer political reasons if no other. Maybe a few juicy, positive leaks before the whole 400 pages drop?
  • David, with hindsight your article "Dear Libs: let the NBN fall on its own" should never have been published. We need all opposition to scrutinise this project because the arrogance and corruptibility of Conroy is staggering. After giving a multimillion dollar gift to Kerry Stokes in return for a free holiday, I don't trust this guy with a multibillion dollar project.
  • On the whole I agree with you but the other side of the issue is that the govt is trying to pass NBN related legislation before parliament finishes sitting next week. The independents and (to a lesser extent) the Coalition are right in complaining that they're being asked to vote on something in an information vacuum.

    On the other hand if the document turned out to be damning how hard would it be in this parliament to introduce a private members bill to reverse the upcoming legislation once parliament sits again next year?
  • Fair comment - but I'd note two points:

    1. The Bill voted on by the Senate next week is not to enable the NBN, but to separate Telstra's assets from its retail arm. Sen Xenophon was careful yesterday to state that he strongly supports the separation while feeling vexed at not seeing the business case yet.

    2. Fielding, Xenophon and the Greens will be getting a private briefing on the contents of the business case next week. Xenophon made a point of declaring that he wouldn't sign a non-disclosure agreement - although that doesn't mean that he'll rush out and blab all. He's a pretty level-headed bloke.
  • Very true although I will point out that the bill does enable NBN Co in the sense that substantial parts of it's business model is dependent on what happens to Telstra and the heads of agreement deal.
  • You're right though. The structural separation of Telstra is in the national interest regardless of the NBN so I guess the business case document isn't really necessary for that particular vote.
  • Is this largely about pollies (on both sides) grandstanding? The longer the release takes, the more attention is drawn to the report itself when it does see the light. If the report is positive, the audience is greater when the time comes because of the fuss beforehand. After all, are pollies asking for CBA each time the Americans scale back their order for the expensive fighter we are buying?

    And what of the need for more electricity generating capacity: according to 7.30 Report $43 billion over FIVE years. The masses are asleep on this issue and largely will be till the crews start digging up their streets.

    For the Opposition, it is always nice having the government do what you want when you want them to. It is seen as a victory if government jumps on command.

    As to Parliament being denied the opportunity to debate, Christmas recess or no, the debate will rage all the more when other issues are not coming forward for attention. The chattersphere does not stop when Parliament rises.
  • What about the Mum's and Dad's Telsra share holders that have been shafted decieved and robbed by governments on both sides of politics. Steven Conroy should be in jail the way he destroyed the company. Josef Stalin would be very pleased with the ********
    J plecher
  • 2005 NWAT revisited.

    It was the Howard government, Rudd government, Gillard government, ACCC, media, TPA, everyone but Telstra's fault!

    Mr Plecher, of course we should all pity those investors who feel they have been hard done by and want to blame all these above.

    But 3 simple letters will answer the question as to why Telstra have gone from thriving monopolist, 800lb gorilla to where they are now.

    All they had to do was agree to big (rather than massive) returns on a FTTN network and they again would have not only continued, but revitalised their monopoly.

    As such, we wouldn't all be here now, arguing over the NBN, as everyone (even the nay-sayers I'd suggest) would still be screaming for FTTP/H and asking why Telstra were still running rampant!

    But Telstra were too greedy and too arrogant and wanted huge FTTN returns and a new monopoly, so they withdrew from FTTN negotiations, which was one of the stupidest decisions in Australia's corporate history (as history has since shown) imo.

    Oh btw those 3 letters are of course... S, O, L!
  • Conroy was voted as the dumbest person in Australia many months ago. I suppose he can use this as a defence for his current actions to avoid any penalties arising from his contempt for the parliament.
  • What an amazing farce this NBN debacle is tuning into. Conroy is clearly treating the Senate with contempt and should be brought to book. David’s piece beautifully sums up the current state of play and when Julia returns on Monday from her NATO jolly she will need to do some serious damage control in the Senate.

    The good news is this pathetic government can not last – surely Winsor and Oakeshott will have some sort of Damascus road experience and realise what a dreadful mistake they made in supporting this dreadful government.

    Get ready for another election – before June 2011 is my tip.
  • Gotta love the Lib puppets...
  • As distinct from your totally objective unbiased view which more often that not goes straight for the personal attack that constantly frequents these comments across all articles eh RS?
  • Of course you don't mention no one else stepped in and built the FTTN either, no one wanted ACCC regulations dictating their bottom line and handing ACCC discounted wholesale access over to their competitors.

    Telstra's decision in conjunction with others who wanted to build FTTN at the time was one of the smartest decisions they made, Telstra then decided to pump millions into the wireless NextG network which is increasingly a big revenue earner, because it supports end products the consumers actually want.

    Only the sucker taxpayer is bankrolling loser ROI fixed line infrastructure that comes under ACCC regulation like the NBN.
  • No I didn't mention it (no one else stepped up to build FTTN) because anyone who knows anything about the history of comms already knows this.

    And the reason they didn't... BECAUSE TELSTRA STILL HADE THE MONOPOLY LAST MILE...Why would anybody else build FTTN on their own accord and still be at their larger competitors (here in Aus) mercy? Ridiculous to even contemplate. Particularly after the HFC fiasco and Telstra's, wipe out the competition at all costs, tactics!

    Of course competitors could have built and tried to forcibly acquire the last mile, but that would have been messy, a legal minefield and the legals would have gone for many years and would probably still be going!

    So of course no one else was going to build FTTN without a platform of some "potential (your favourite word)" certainty!

    This is where the RFP to build an NBN came in (remember you WRONGLY called and keep calling it a FTTN tender) and I believe there were 6 applicants. So when given certainty in a formal process, there were interested parties!

    Of the 6 Telstra were the only ones who "intentionally" forwarded an invalid bid as it did not comply, smart eh?

    Speaking of smart decisions, LOL....

    Yes Instead of agreeing to a FTTN monopoly, controlled by a complete Telstra (retail/wholesale), which would now be built, profitable (imo) and a new monopoly intact for many more years... Telstra will instead (because of their greed and arrogance) be separated and their monopoly stripped from them.


    I think following several embarrassing lessons for you, you just disagree for the sake of disagreeing...You must, no one could intentionally be so wrong, could they?
  • Tell us about the kettle calling the pot black [sic]!
  • In that rant you conveniently overlooked the G9 consortium headed up by SingTel/Optus that submitted a FTTN proposal to the ACCC of which the ACCC said at the time was a viable alternative to Telstra.

    You also conveniently overlook that the G9 consortium just like Telstra wanted regulatory changes to ACCC powers before they would consider a build, especially in the area of ROI.

    You also overlook that when Sol headed up Telstra he fast tracked the NextG rollout, he knew where the market was heading and he was right, Telstra are reaping the rewards big time of having the fastest and most extensive wireless network in Australia, no competitor comes close.

    But never let the historical facts get in the way of a no facts off topic rant eh RS?
  • Historical fact, there isn’t a FTTN network...?

    And why is that? Because as I said, Telstra own the last mile! The acquisition of Telstra assets I spoke of is part of the regulatory changes that would have been needed for the G9 to build... that you speak of!

    Now as you know (and Syd can vouch for, lol) I'm no Telstra fan and yes the courts said, Telstra did not have complete rights over the PSTN as they claimed. But that wasn’t ownership rights per se’, the courts were speaking of competitors rights to access Telstra’s network. Competitors could access but couldn’t simply build a FTTN network and seize the PSTN!

    So seriously, if you don't think that Telstra would have bogged down the court system (and probably rightly so) for years, to stop these regulatory changes, thus leaving us with the previous, high prices and lack of the latest technologies we know enjoy post NBN announcement, well you are most naive, imo!

    Realistically, the G9/TERRiA were never serious anyway (you conveniently overlook that in the end the TERRiA consortium, did not even submit their own RPF to build the NBN).

    They were simply, all expecting Telstra to build it (either initially or win the RFP) and they just wanted the best deal they could get...from a new Telstra monopoly!

    This takes us all the way back to Telstra not grabbing the FTTN deal, as one of the worst blunders ever (imo)!

    You even speak of how happy the ISP's must now be, having a bankrolled NBN. So again, even your own logic gives further credence to my point that Telstra "abandoning FTTN" and giving the government impetus to build and remove Telstra's dominance, by allowing these competitors access to a new bankrolled NBN, on equal terms with Telstra, was a whopping blunder by Telstra!

    Then you mention NextG... yes it was a wise investment (Sol had to earn his $30m somehow) I won't argue there. But... you seem to think this was an alternative to FTTN?

    Don't think so! What Telstra did, was start to invest a bit in regional and rural areas, to beat OPEL to the punch (think HFC again)...

    But again, it has turned out to be a good investment for Telstra and a great network. My wife has an iPhone 4 on Next G and the reception is waaaay better than my Optus mobile!

    But whether it was -
    1. A planned winner
    2. Just a happy accident

    I think is very debatable. Personally, seeing the damage caused by Sol and his team and that whopping FTTN blunder, LOL, I believe its #2!
  • Oh this is so sad, I have to admit I agree with our friend RS on most points he made in his last post.
    Blank Look