NBN Co 'unaware' of Coalition's copper claims

NBN Co has admitted that it has no knowledge of part of the Coalition's broadband policy alternative to the National Broadband Network (NBN), which would see 10 percent of existing premises continue to get fibre to the premises because Telstra's copper network would be too dilapidated to be usable for a fibre-to-the-node network.

In the Coalition's broadband policy, released in April 2013, it estimated that by the end of the party's proposed rollout at 2019, should it have won the election, 22 percent of premises would be covered by fibre to the premises and 71 percent by fibre to the node, with the remaining 7 percent continuing to be serviced by fixed-wireless and satellite technology.

The 22 percent figure was derived from adding up the number of new premises where fibre is the default new connection, the number of existing premises covered by existing NBN Co contracts to the end of this year, and the "roughly 10 percent of stand-alone premises" that will be served by fibre after 2014 that were "assumed to be in areas with the poorest or most maintenance-intensive copper".

How then-Shadow Communications Minister Malcolm Turnbull came up with this figure remains unclear, particularly when Telstra has kept information about the quality of its legacy copper network close to its chest. Before and after the election, Telstra and a number of NBN Co's top executives defended the quality of Telstra's copper network and the capacity to deliver fibre-to-the-node services in the face of anecdotal evidence to the contrary from union officials representing Telstra's field contractors.

The question came up at a Senate Estimates hearing in late November, when Labor Senator Kate Lundy asked NBN Co and Coalition Senator Mitch Fifield — who was acting for Turnbull at the hearing — where the figure came from.

NBN Co executive chairman Dr Ziggy Switkowski said at the time that he did not understand the metric, and would take it on notice. In a response published today, NBN Co said the figure was not something the company had any knowledge about.

"NBN Co is not aware of the source of the 10 percent figure or the context in which it might have been used," the company said.

It comes as NBN Co is entering into renegotiation with Telstra over its AU$11 billion deal with the company in order to be able to access the copper for a fibre-to-the-node proposal.

The answers to questions on notice also revealed that any test of Telstra's network for suitability for fibre to the node is "dependent on NBN Co's commercial arrangements with Telstra" and as such were subject to negotiations that are "commercial in confidence".

NBN Co also redirected senators back to Telstra to provide information on the number of fault rates on the copper network from high-frequency interference.

The answers also revealed that Switkowski is paid higher than originally estimated, with his annual salary set at AU$209,630 per annum. Switkowski will also receive AU$50,000 per month extra until Vodafone Australia's CEO Bill Morrow takes up the NBN Co CEO job at the end of March.

In the first 40 working days since being appointed, NBN Co said Switkowski has worked the equivalent of 27 full-time days.

Two positions were made redundant at NBN Co between the election and November 19, 2013, and 46 permanent staff members and nine non-permanent staff members left in that time, but the company also added 99 permanent staff members, 65 non-ongoing staff members, and 59 contractors.

NBN Co spent AU$8 million on consultants as part of the strategic review, which will ultimately determine the future direction for the company. Internally, the company devoted between 400 to 500 work days to the project, for a cost of between AU$320,000 and AU$350,000.