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Is NZ govt spend redundant?

In the New Zealand Government's first ever infrastructure plan, it calls its own broadband investment into question.
Written by Darren Greenwood, Contributor on

In the New Zealand Government's first ever infrastructure plan (PDF), it calls its own broadband investment into question.

The New Zealand Government claims the private sector is not moving fast enough, hence its own $1.5 billion investment for ultrafast broadband in towns, plus a further $300 million for the rural sector.

However, the infrastructure plan reveals more than $2 billion of private sector investment from the three main telcos on mobile networks and broadband provision for the next few years. This investment included $1.4 billion of investment from Telecom alone on cabinets so it can provide all towns with more than 500 people broadband speeds of 3 to 7 megabits per second by 2011. Vodafone is also helping the rural sector through its network. Then we have to consider localised urban fibre projects such as CityLink in Wellington that the plan does not mention.

With existing suppliers so keen to deliver broadband, government largesse starts to look unnecessary. Indeed, I can only wonder how many private programs have been crowded out by the publicly-funded schemes.

The government is borrowing $250 million a week to balance the books. Now, $1.5 billion for the towns and $300 million for the rural broadband (though some of this will be funded by a levy on telcos) is minor by comparison, but it does make me wonder about its priorities, especially when the private sector can so obviously step in.

I recently argued that cities can supply their own broadband. I do think a case for subsidy might exist for education, plus the rural and primary sector who deliver so much wealth to New Zealand, but the suburban residents seeking faster downloads of porn, music and movies have no right to get their hands in the tax payer's pocket. The state takes enough already for more "essential" items.

It is not as if broadband and internet are fundamental human rights as most of the world seems to believe.

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