NBN stalled in Tasmania: Turnbull

'Little or no work' on the NBN fibre rollout in Tasmania has been done in the last two months, and it is unlikely that it will be completed by 2015, according to Communications Minister Malcolm Turnbull.
Written by Josh Taylor, Contributor

Problems with National Broadband Network (NBN) construction contractor Visionstream means little or no work has been done on construction of the fibre-to-the-premises portion of the NBN in Tasmania in the last two months, according to Communications Minister Malcolm Turnbull.

Visionstream, which secured a four-year, AU$300 million contract to complete the fibre network build in Tasmania out to 190,000 premises in March 2012, has been dogged by claims that its sub-contractors working on the NBN in Tasmania have not been paid.

The dispute appears to have taken its toll on the rollout in Tasmania, with Turnbull telling ABC Hobart today that no work has been done for at least two months.

"As far as we can see, no work has been done by Visionstream for at least two months. And they've basically downed tools. The Labor party didn't say anything about that during the election," he said.

Some Tasmanians have hoped that the Coalition government would complete the fibre rollout in their state because prior to the election, Turnbull promised that the government would honour existing contracts. This would mean that the NBN would be completed in Tasmania under Visionstream's existing contract. Turnbull told the ABC that "it takes two to tango", and it would be up to Visionstream to meet its obligations to ensure that the contract would remain as it is.

"There is not one thing I could do to stop the NBN rollout in Tasmania, because it has been stopped for several months. And at this stage, Visionstream is not building anything," he said.

"There is a serious problem there which we've got to address. I'm not suggesting we would dishonour or breach any contract, but, at the moment, nothing is being done on the contract by the contractor."

After several texts were received to the ABC stating that work has recommenced in Tasmania, Turnbull said that "little or no work" had been completed by Visionstream in the last few months, and he cast doubt on whether the company would finish its work by 2015 as planned.

"The last figures we saw from NBN Co showed that less than 20,000 premises had been passed with fibre in Tasmania, and so that's less than 10 percent of the total rollout, so obviously completing it by 2015 looks pretty optimistic," he said.

Visionstream has been contacted for comment, but had not responded at the time of writing.

It comes as NBN Co, along with its new executive chairman Ziggy Switkowski, has begun a 60-day review of its operations to look at the best way to forge ahead with the project, and what company changes need to be made to reduce the cost of building the network. Turnbull confirmed on Sunday that the report will likely be released on December 2.

There is also concern that Switkowski may be hit with conflicts of interest when it comes to renegotiating with Telstra or Optus over their respective NBN deals. Although he was the CEO of both companies at some stage, Turnbull's office confirmed to ZDNet that Switkowski has not had shares in any telecommunications companies for "many years".

ACCC asks for more changes

The Australian Competition and Consumer Commission (ACCC) has asked NBN Co to again vary its Special Access Undertaking (SAU) document, which sets out the access and pricing terms for services on the NBN until 2040, but the company will need to respond before its 60-day review is completed.

The changes to the SAU document will give the regulator better oversight of NBN Co's efficiency and capital expenditure, allow the ACCC to make an additional review of NBN Co's pricing during the rollout, and prevent NBN Co from changing a product offering that reduces the functionality, performance, or features of that product.

ACCC chairman Rod Sims said that the SAU document could easily adapt to the change of government and the potential change in NBN policy.

"The ACCC understands that the government will now provide new policy directions to NBN Co. However, most of the commitments in the SAU are technology neutral and will apply even with a significant change in network design," he said in a statement.

"In addition, if NBN Co wishes to vary the undertaking in the future in light of any new directions from the government, this can be accommodated."

NBN Co has until November 19 to respond to the ACCC's request, just under two weeks before NBN Co's internal review has been completed. If NBN Co does not respond, the ACCC will make its decision based on the second SAU lodged in December 2012.

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