Turnbull to leave NBN cuts to new board

Communications Minister Malcolm Turnbull has said that the new NBN board, not the government, will decide the number of job cuts at NBN Co.
Written by Josh Taylor, Contributor

At the opening of NextDC's flagship S1 datacentre in Macquarie Park, Sydney, Communications Minister Malcolm Turnbull confirmed that the size of NBN Co's headcount will not be determined directly by the Cabinet, but rather by the new NBN Co board appointed by the Cabinet.

NextDC CEO Craig Scroggie with Communications Minister Malcolm Turnbull.
Image: Josh Taylor/ZDNet

In opposition, Turnbull was highly critical of the close to 3,000 staff members who were employed by NBN Co but not directly involved in the construction of the National Broadband Network (NBN), and the assumption was that under the Coalition, NBN Co would be a much leaner operation.

But on Monday night, Turnbull indicated that the Coalition will not set any targets for the number of jobs that must go from NBN Co, instead relying on the new board to determine the number of cuts out of the 60-day review of the company that will commence when the board is appointed.

"I think we should make our decisions based on facts. It is a very large workforce, but we're going to undertake this strategic review, which will give us a very keen assessment of the business — where it is now, how long it will take, and how much it will cost to get to completion if it continues under the previous policy, and then what are the options for improving the cost effectiveness and timeliness of the construction if you use some different technologies," he said.

Turnbull said he is confident that NBN Co could undertake this review of itself with the new board.

"There will be a new board, there will be new senior executives, but it is very important in an exercise like this that it is not just produced by [a consulting firm]. This has got to be owned by the management of NBN Co," he said.

There have been reports of a number of approaches made to high-profile candidates for the new NBN Co board, including most recently the former communications minister from the later era of the last Coalition government, Helen Coonan. Turnbull refused to speculate on who might be appointed to the new NBN Co board, stating that Cabinet will be considering appointments this week.

Telstra job losses won't be part of renegotiation

Last week, Telstra announced that it would be cutting approximately 1,100 jobs from its operations division. The job cuts represent the first major job losses to happen under the new Coalition government, and in Turnbull's area of responsibility in a time when he is about to commence lengthy renegotiations with Telstra over its AU$11 billion NBN deal to access the copper loop for fibre to the node.

Turnbull indicated that the government would not seek to address the job losses as part of the negotiations, instead stating that the technology industry will be able to make up the jobs in other areas.

"We're always concerned about job losses, but the critical thing to bear in mind is in the Australian technology and telecommunications business, there are jobs being created all the time," he said.

"There's a tendency to only look at the job losses side of the equation, but in a dynamic country, in probably the most dynamic part of the economy, there are jobs being created all the time as well. The critical thing from our point of view is to ensure Australia is more productive, that Australian businesses are given greater encouragement, that there is less red tape impeding them, so that there is a more dynamic economy."

Turnbull said he also wouldn't intervene in the Australian Competition and Consumer Commission's (ACCC's) decision to forge ahead with the decision-making process around NBN Co's access terms, despite the upcoming policy change.

"The industry is very keen to have the [Special Access Undertaking] settled. The sort of changes we've canvassed in our policy I don't think would have a material impact on the regulatory environment, or the context that those regulations would operate," he said.

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