Labor critic appointed to 'independent' NBN review panel

Communications Minister Malcolm Turnbull has appointed Labor critic Henry Ergas to the independent expert panel to conduct a cost-benefit analysis into broadband and NBN regulation.

In amongst the news around the release of the NBN Co strategic review, Communications Minister Malcolm Turnbull has quietly announced a four-person panel of experts to conduct a cost-benefit analysis into broadband and the regulatory environment of the National Broadband Network (NBN).

According to the terms of reference, the panel will be tasked to conduct an "independent cost-benefit analysis and review of regulation to analyse the economic and social costs and benefits (including both direct and indirect effects) arising from the availability of broadband of differing properties via various technologies, and to make recommendations on the role of government support and a number of other longer-term industry matters".

The panel will also be asked to assess the regulatory environment of the NBN, the competitive environment for NBN Co, and the product and pricing structure for the NBN.

The announcement confirms some of the information that had been leaked in November, including the controversial appointment of professor Henry Ergas. Ergas is a senior economic advisor at Deloitte, and has served with the Department of Communications in reviewing telecommunications policy in Australia.

The Coalition government believes that Ergas is well qualified for the role, but Ergas has been a long-time critic of Labor's National Broadband Network (NBN) project. When Labor was first considering the NBN, Ergas argued against structural separation of Telstra's wholesale and retail arms. In 2009, he claimed that retail prices on the NBN would have to be AU$215 per month in order to pay for the project.

Ergas was also heavily critical of the cross-subsidy built into the NBN, arguing that consumers in the city should not be forced to subsidise the cost for rolling out the NBN in regional areas.

But in addition to his criticism of the project, it was discovered that Ergas had handed out how-to-vote cards at the federal election in September. When asked about this by Fairfax, Ergas said he is not a Liberal Party member, but thought that the election of Liberal Senator Zed Seselja would be a "good thing" for Australia.

Shadow Communications Minister Jason Clare said the appointment of Ergas would lead to a review that confirms Turnbull's existing views.

"This is more evidence of Malcolm Turnbull appointing his mates to give him the answers he wants," he said in a statement.

The panel will be chaired by Dr Michael Vertigan, who has a long history in the public service in Tasmania, and is currently the chair of the Australian Maritime College Board and a director of Aurora Energy and the Commonwealth Superannuation Corporation.

Also on the panel will be Insurance Australia Group director and former eBay Australia MD Alison Deans, as well as Tony Shaw, the former chairman of the Australian Communications Authority and an original member of the NBN panel of experts established under the former government to determine the initial NBN proposal.

In a statement, Turnbull said that the panel contains "decades of relevant experience in telecommunications, regulation and competition policy, economics, public policy, and digital business".

"Their work will provide the government with rigorous, robust, and independent advice that will help guide decisions on the future of fast broadband and the National Broadband Network (NBN) in Australia," he said.

The panel will be required to report back to government by June next year.