Mandatory data-retention funding to be a Budget surprise

The head of the peak telecommunications industry group in Australia has said that telcos won't know how much compensation they will receive for storing customer data for two years until Budget night, and even then, it is likely to be much less than anticipated.

The legislation forcing telco companies to retain a set of customer data for two years for access by law enforcement without a warrant became law this month after passing the Senate with Labor supporting the government. The legislation will come into effect from October.

Mandatory data retention passed without the Australian public knowing the cost of the scheme for telcos to build systems to store the data, nor how much the government intends to contribute to the set-up.

Brandis revealed that the cost per customer per year for the operation of the scheme will be AU$4, but the cost of building the systems, contained in a confidential PricewaterhouseCoopers report, remains unknown.

Brandis said at the time that the government's contribution will be detailed in the Budget in May, and Communications Alliance CEO John Stanton told the CommsDay Summit on Tuesday that the telcos themselves would not know the cost of the scheme until it is revealed in the Budget papers on May 12.

"We don't know what the government thinks the cost of the scheme is. The government has steadfastly refused to give guidance on what its contribution will be," he said.

Before the funding is decided, Attorney-General George Brandis will need to get the funding approved by the so-called "razor gang" of the Expenditure Review Committee, headed up by Treasurer Joe Hockey and Finance Minister Mathias Cormann.

Stanton said it is likely that telcos would get much less than they were hoping as a result.

"Even if you believe George has the best industry views at heart, how is it going to survive the Expenditure Review Committee?"

In addition to the copyright infringement code, the site-blocking legislation, and the proposed levy to be imposed on telcos to fund network infrastructure resilience, Stanton said the government had gone a long way to impose more red tape on the telecommunications industry since coming into office in 2013.

"If you're starting to feel like George Brandis' personal cash machine, there's good reason," he said.

"He's turned red-tape creation into an ugly art form."

He said the industry is focused on working towards the "least worst outcome" for all three issues.