Turnbull commits to all current NBN contracts

Australian Shadow Communications Minister Malcolm Turnbull has ruled out altering any existing NBN contracts, including for construction of the network.
Written by Josh Taylor, Contributor

Australian Shadow Communications Minister Malcolm Turnbull has responded to claims that the Coalition would cancel construction of the National Broadband Network (NBN) in Tasmania if it wins the September federal election.

It was reported this morning that Tasmanian ICT CEO Dean Winter said that Turnbull has only committed to honouring NBN construction contracts where construction is already underway. This would mean that once construction of the fibre-to-the-premises network has been completed in a certain area, those workers could potentially then be tasked to begin building the Coalition's proposed fibre-to-the-node network.

Communications Minister Anthony Albanese seized upon the suggestion, and said that 85,000 premises in Tasmania would be "denied" fibre broadband under the Coalition. He proceeded to list the Tasmanian suburbs that the Labor Party believed would be affected.

Under the current project, Tasmania is set to be the first state where NBN Co completes the construction of its network in 2015.

Turnbull has previously said that he would seek to honour the contracts in place by NBN Co, but conceded that the party may look to terminate contracts where it is viable.

We're not about breaking contracts, even if they've been entered into unwisely. Where contractual commitments have been made, the Commonwealth has to honour them," he said in May 2012. "If there are termination provisions in some contracts, I suppose that's something you could look at, if it made more sense to terminate something than to continue with it. But really, I don't anticipate that happening."

After the release of the Coalition's alternative policy in April, Turnbull blamed the existing contracts in large part for the reason why the Coalition's alternative broadband policy is priced at AU$29.5 billion, and today said that all contracts entered into would be honoured by the potential future Coalition government.

"This is not just a commitment to honour contracts where construction is underway — but all contracts which have been entered into," he said.

The announcement potentially locks the Coalition into a number of construction contracts that NBN Co has announced since the election was called two weeks ago. The contract extensions have so far only been one year long, and the Coalition's policy currently allows for existing construction to continue until 2014.

It comes as Turnbull has also faced criticism over the revelation that the Coalition had decided not to have its alternative NBN policy costed by the Parliamentary Budget Office (PBO). Turnbull had suggested that the PBO did not have the expertise to cost the policy.

The Charter of Budget Honesty allows parties to use either the Treasury or the PBO to cost policies, but not both. As the PBO has been ruled out as an option, Albanese said today that the Treasury or the Department of Finance and Deregulation could cost the alternative policy.

"This is just another Coalition excuse to conceal their real plans from Australians," he said in a statement.

"If Mr Turnbull has nothing to hide, he should provide his policy for independent scrutiny."

The PBO could not confirm at the time of writing whether any other Coalition policies had also been deemed "too complex" for the office to evaluate.

This afternoon Turnbull said the PBO ruled out costing the Coalition's policy "quite some time ago earlier in the year".

"The real issue with any of these business models is 'what are the assumptions' and it is very hard unless you have engineering and network experience to be able to form a judgement about that."

He said that the Coalition's alternative policy and its forecast that Labor's policy could blow out to AU$94 billion have been fully costed.

"Our model on the NBN is fully costed. We have fully costed it and set out all the assumptions so it is very transparent," he said.

"We published [our plan] four and a half months ago and despite all the expertise in the field, no one has published a counter-analysis that demonstrate that those assumptions are anything other than reasonable."

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