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Libs would wind back NBN to fund roads

By on January 31st, 2012 

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Funding for the National Broadband Network (NBN) and a number of other tech projects would be redirected to building roads and tax cuts under a Tony Abbott Coalition government, the opposition leader has revealed.

Tony Abbott

Tony Abbott addresses the National Press Club in Canberra.
(Screenshot by Josh Taylor)

Speaking at the National Press Club in Canberra today, Abbott outlined that should the Coalition win the next election, the Liberal National government would end a number of programs and scale back the public service by 12,000 to bring the budget back into surplus, and deliver a number of tax cuts.

"The starting point will be programs that have become bywords for waste. Discontinuing the computers-in-schools program, which parents are now having to pay for anyway, will save half a billion dollars," he said. "Big savings could be made in the government's $350-a-throw set-top box program, since Gerry Harvey can supply and install them for half the price."

In addition to canning the government's controversial mining tax and carbon tax, funding for the NBN would also be shifted to building roads, he said.

"Better broadband will once more be delivered through market competition, freeing more money to tackle pressing problems like the traffic gridlock in outer metropolitan areas," he said.

The Coalition has not clearly outlined its proposed alternative to the NBN; however, Shadow Communications Minister Malcolm Turnbull has said that the fibre roll-out would be scaled back, with the use of fibre to the node (FttN) in some areas, and opening up the hybrid fibre-coaxial (HFC) networks of both Telstra and Optus to competition. No costs have yet been revealed; however, one independent firm put the cost for Turnbull's plan at $16.9 billion.

The Coalition has previously attacked the NBN for being "off-budget", meaning that it doesn't appear on the budget bottom line for the government. However, a Parliamentary Library economist said recently that the government's costing was correct, given that the project was not an expense, because it was seeking a rate of return of 7 per cent.

Abbott said that no good government would have embarked on the NBN project in the first place.

"No good government [would spend] $11 billion on buying Telstra's copper wires only to shut them down, too," he said. "Or $50 billion plus on a National Broadband Network that people don't need and don't want to pay more for."

Talkback

Abbott's living in a world of the past. Building roads should have ended years ago, oil supplies peaked around 2006 and are now in decline, today's production of 86MB per day will decline to 65MB per day in 2020 and to under 60Mb per day by 2025. There is no combination of new technologies, synfuels and biofuels that can even partially compensate for the loss of this oil production, due to the high energy density of Oil. Therefore the numbers of cars on Australian roads will begin to fall when the next surge in Oil prices occurs in the next year or two. Oil is a declining zero sum game every car that hits the road in China or India means 1.5 cars have to leave the road in OECD nations. Mr Abbott will be coming to an election at the time of the next big price surge and the world leaders holding panicky conferences about what to do about looming shortages.
We need to improve communications infastructure urgently so the work can be completed before the cost becomes overwheming due to high oil prices. Communications is the greatest energy saver of all. Roads are white elephants.

Kevin CobleyKevin Cobley January 31st, 2012
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I wonder how this dope intends to pay for his FTTN patchwork plan, that $20 billion plus (I can add billions too) has to come from somewhere and it's clear now that these clowns dont care about improving communications infrastructure in Australia at all with their latest comments.

Hubert CumberdaleHubert Cumberdale January 31st, 2012
Report offensive content Reply (+39) (-7)

The biggest inhibitor for cost effective, next generation broadband in regional areas is network backhaul. At the moment there is very little competition in for network backhaul in regional areas, so it's very expensive. This in turn makes high speed broadband in regional areas very expensive. The best approach is for the government to create incentives for private companies to to build competative network backhaul to regional areas. Once there is competative network backhaul, and it's cheap to connect regional areas back city Internet hubs, it makes it more compelling for private companies to build their own competative broadband networks. It has been demonstrated many times in the past that once competative network backhaul is available in a regional area, companies invest, services improve and prices reduce. The oppositions FTTN plan lays the groundwork for competative highspeed broadband; funded mostly by the private sector. The governments job is to run the country, not to build and operate multi-billion dollar broadband networks at the tax payers expense.

chrispilgrimchrispilgrim January 31st, 2012
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"The biggest inhibitor for cost effective, next generation broadband in regional areas is network backhaul."

So, you say the reason why I can’t get a 100/40mbps connection in my area now is because of "network backhaul" issues? Interesting.



"The best approach is for the government to create incentives for private companies to to build competative network backhaul to regional areas."

Incentives = money hats. That's a taxpayer expense btw.


"Once there is competative network backhaul, and it's cheap to connect regional areas back city Internet hubs, it makes it more compelling for private companies to build their own competative broadband networks"

Wow, sounds like you've got it all figured out chrispil. Competitive network backhaul is the answer. Amazing, just think once the "competative network backhaul" is in place private companies will be lining up to lay fibre all over the country.



"The oppositions FTTN plan lays the groundwork for competative highspeed broadband"

Except it doesn't. All it does is waste time and money while people wait for actual competitive high speed broadband which is the NBN.



"The oppositions FTTN plan lays the groundwork for competative highspeed broadband"

btw how does this fit in with the "competative network backhaul"? Does the government build this? Or private companies?



"The governments job is to run the country, not to build and operate multi-billion dollar broadband networks at the tax payers expense."

The governments job is to run the country, not to build multi-billion dollar road networks at the tax payers expense.

Hubert CumberdaleHubert Cumberdale February 1st, 2012
Report offensive content Reply (+43) (-5)

"The biggest inhibitor for cost effective, next generation broadband in regional areas is network backhaul."

So, you say the reason why I can’t get a 100/40mbps connection in my area now is because of "network backhaul" issues? Interesting.

I never said there backhaul issues - the networks are there now. What I said is that due to lack of competition it is very expensive in regional areas. There are companies trialing out their own residential grade fibre networks now... where backhaul is cheap - and it's not funded by the tax payer.



"The best approach is for the government to create incentives for private companies to to build competative network backhaul to regional areas."

Incentives = money hats. That's a taxpayer expense btw.

Agree - but it's not $43B of tax payers money. $16.9B to $20B is a good compromise if you ask me. It could even translate to 'part' government ownership if that was the best model.


"Once there is competative network backhaul, and it's cheap to connect regional areas back city Internet hubs, it makes it more compelling for private companies to build their own competative broadband networks"

Wow, sounds like you've got it all figured out chrispil. Competitive network backhaul is the answer. Amazing, just think once the "competative network backhaul" is in place private companies will be lining up to lay fibre all over the country.

Good point; we shouldn't be laying fibre all over the country. I for one do not want pay more for a fibre based 100Mbps service in the city just so some farmer in Dubbo can access same service at the same price (you live in Dubbo; deal with it). Give me one business benefit that can be achieved by said said farmer in Dubbo using a 100Mbps Internet service that he can't achieve using his existing ADSL service now?

You only need to look at the rise of the low cost broadband providers today (iiNet, Internode, TPG, iPrimus etc etc). Once network backhaul because cheap, they were able to build out their own networks, provide faster, cheaper services, and give Telstra a real run for their money. The consumer was the winner. A competitive open market always fosters progression and reduces cost to consumers.


"The oppositions FTTN plan lays the groundwork for competative highspeed broadband"

Except it doesn't. All it does is waste time and money while people wait for actual competitive high speed broadband which is the NBN.

Of course it does. There are just some people that may have to wait a little longer than others. Refer to point about Farmer in Orange.



"The oppositions FTTN plan lays the groundwork for competative highspeed broadband"

btw how does this fit in with the "competative network backhaul"? Does the government build this? Or private companies?

I'm not sure you have a grasp of this; FTTN (or fibre to the node) is the backhaul network. The last time this was proposed was the OPEL network (which was scrapped when Labor came back into power). 50% funded by government, 50% funded by private business (Optus and Elders). Private business was more then willing to put billions forward to invest in this.


"The governments job is to run the country, not to build and operate multi-billion dollar broadband networks at the tax payers expense."

The governments job is to run the country, not to build multi-billion dollar road networks at the tax payers expense.

Roads may not be the answer - but a $43B network certainly isnt the answer. You're not a communist, are you?

chrispilgrimchrispilgrim February 1st, 2012
Report offensive content Reply (+6) (-58)

chrispilgrim, you put forward some very interesting points of view so if you let me know what your Liberal party payroll number is I can communicate with you on a much more personal basis and then ask you to validate your numerous postings on this blog, looking forward to this.

BoomerMMWBoomerMMW February 1st, 2012
Report offensive content Reply (+34) (-5)

Chrispilgrim you are taking the p*ss…!

Surely no one anywhere (unless hampered by a sheep like need to conform to political ideology) can actually believe using government money, sourced from the sale of bonds (not taxpayers) to build much needed infrastructure, which will in time “pay for itself” and will be a valuable “asset for all Aussies” is a bad thing.

But to then suggest it’s "wasteful", cry "Commie" and promote “gifting $b’s to private enterprise to both build and own Australia's comms network, which will leave us with little or no ROI and no asset ownership, is rank hypocritical stupidity”, imo.

BetaBeta February 1st, 2012
Report offensive content Reply (+34) (-4)

"I never said there backhaul issues - the networks are there now."

Where is the FTTH network?




"There are companies trialing out their own residential grade fibre networks now... where backhaul is cheap - and it's not funded by the tax payer."

So your premise is where backhaul is cheap fibre networks will materialise?




"$16.9B to $20B is a good compromise if you ask me."

So you endorse wasting taxpayer’s funds on a redundant network?



"I for one do not want pay more for a fibre based 100Mbps service"

Why do you need 100mbps? Name one business benefit that can be achieved using a 100mbps internet service that YOU can't achieve using an existing ADSL service now.




"A competitive open market always fosters progression and reduces cost to consumers. "

Congratulations. You just described the NBN.




I'm not sure you have a grasp of this; FTTN (or fibre to the node) is the backhaul network.

I'm not sure you have a grasp of this but a FTTN network is a deadend solution and a waste.




"The last time this was proposed was the OPEL network (which was scrapped when Labor came back into power)."

It's clear now they did the right thing. The governments job is to run the country, not to build and operate multi-million dollar wireless networks at the tax payers expense.




"Roads may not be the answer - but a $43B network certainly isnt the answer."

Apparently it is. Solves most broadband problems in one fell swoop. You certainly can’t say that about the oppositions FTTN patchwork plan. In fact it actually creates more problems than it solves.




"You're not a communist, are you?"

Yes. Let's talk about communism and let's talk about a plan where if you want faster speeds you have to wait for everyone else living in you area to demand it too. You are relying on the rest of your community dictating how much speed you get rather than how much you are willing to pay. Brilliant. Now tell us which one is the communist plan and which one is the capitalist plan.

Hubert CumberdaleHubert Cumberdale February 1st, 2012
Report offensive content Reply (+32) (-4)

"Agree - but it's not $43B of tax payers money. $16.9B to $20B is a good compromise if you ask me"

This is where all of the arguments fall down...
Trying to compare an investment with full payback of $36 Billion to a flat-out expense of $20 Billion with no hope of repayment to the taxpayer is just ridiculous. There is no contest, the Coalition plan is just plain financial irresponsibility.

viditorviditor February 1st, 2012
Report offensive content Reply (+31) (-1)

@chrispilgrim:

Do you know how much it costs currently to get top tier NBN speeds in Surry Hills (basically 3 or 4 kms from the CBD)? It's prohibitively expensive. We're currently paying $1400 a month for a 25/25 Midband Ethernet connection with a 500GB include allowance (Exetel). We don't always get the 25/25 too since it's still copper. Fiber, if you can get it, is at $2900 a month for a 100/100 with 500GB. So I'm a little disheartened by "industry competition" even in metropolitan areas, let alone regional Australia without huge subsidies from the government (which we will never make back and are a direct expense to the tax payer). The NBN can currently offer 100/40 with 600GB for $114.95 (Internode). Admittedly that's a "home" plan, but more than a thousand dollar difference for a supposed up-time guarantee? How many business do you think could be in a similar situation -- paying thousands of dollars a month instead of hundreds? The NBN isn't just for home users. I know several people that run a business out of their homes (photography, vfx, etc...) which would love to be able to upload content quickly (more than the 820 kbps of ADSL 2+), but to pay $1400 a month, definitely not. For $114.95, they would jump at it. Who knows, with the NBN we may even start seeing technological companies and data centers moving out of metropolitan areas which could help housing and traffic congestion. To ditch the NBN on cost alone is a little narrow minded. Heck, even if all the NBN makes is half it's cost back, it will still put Australia in a much better position than the current Liberal alternative (which will also have cost blowouts due to Turnbull's assertion that all government projects run over budget). For example, the government will have an asset in the NBN; they will have broken Telstra's monopoly on the fixed line infrastructure; they will have provided regional Australia with internet worthy of the current era and is priced the same as the city; they will have replaced the aging copper which is akin to roads filled with so many potholes that the entire road needs replacing; they will have replaced the HFC network that will most likely need replacing by the time the NBN comes to the same region anyway (as in 9 or 10 years from now); they will have provided a unified environment with which new digital markets can grow; they will have reduced the price of high speed uploads in the city as high speeds will become ubiquitous; etc...

gammproggammprog February 8th, 2012
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This has already been done, you can thank Labor.

http://www.nextgennetworks.com.au/RBBP.aspx

It's nearly finished, too.

But personally I see the main limiter the last mile, what good is huge quota's if your speed is slow slow you can barely put a dent in them.

DuidekaDuideka February 1st, 2012
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Exactly right - but it will need to get much closer to more regional communities before it can be an alternative to the current NBN.

But it is an excellent example of private sector funding (with government support) these networks.

Last mile is the issue - but let supply and demand dictate the roll out of last mile networks (again - with government financial support if required).

chrispilgrimchrispilgrim February 1st, 2012
Report offensive content Reply (+1) (-52)

"The governments job is to run the country, not to build and operate multi-billion dollar broadband networks at the tax payers expense."

The governments job is to run the country, not to build and operate multi-billion dollar road networks at the tax payers expense.

The governments job is to run the country, not to build and operate multi-billion hospitals at the tax payers expense.

The governments job is to run the country, not to build and operate multi-billion dollar water distribution networks at the tax payers expense.

The governments job is to run the country, not to build and operate multi-billion dollar police forces at the tax payers expense.

The governments job is to run the country, not to build and operate multi-billion dollar defence networks at the tax payers expense.

How many others do you think would be better privately run?

CowcakesCowcakes February 1st, 2012
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The man's a dinosauric imbecile.

splatmansplatman January 31st, 2012
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Tony Abbott really annoys me, society is drifting away from roads,
build bigger and bigger roads doesnt solve anything,


getting better alternative transport such as rail bicycles and yes telecommuting via NBN is far more beneficial than roads that will congest no matter how much you spend

the bigger the roads themore cars that congest them.
The only way to solve that is get spread them out to different schedules and alternative travel

carl0skicarl0ski January 31st, 2012
Report offensive content Reply (+37) (-10)

When are Tony Abbott and his colleagues going to realise that one of the reasons they are not the Government at the moment is this head in the sand attitude to the NBN.

Unfortunately the opposition has yet to propose a cost effective and workable alternative to the NBN. Every time they open their mouth about this they seem to change their minds and ignore what is happening in the real world. No where in the rhetoric do the Liberal party acknowledge the cost of stopping the NBN including the payment they will have to make to Telstra for reneging on the deal.

If the Libs think that Australians don't want or need the NBN then they don't deserve to be given a chance to govern because they are totally out of touch with reality.

brownbear1947brownbear1947 February 1st, 2012
Report offensive content Reply (+47) (-3)

Build me an NBN and I won't need to use the roads (as often).

DanielB1DanielB1 February 1st, 2012
Report offensive content Reply (+42) (-3)

But how does your food transported from the farm to your local shops? As much as I like fast broadband, I'll take a better road system than a faster broadband.

PS: I am not an Abbott Fan.

Jules_01Jules_01 February 1st, 2012
Report offensive content Reply (+7) (-30)

Err... along the roads, delivered by professionals, just like now.

DanielB1said "he" wouldn't have to use the roads "as often", which is the same for a lot of us (who aren't professional couriers).

Please don't pedantically nit pick and then say oh, but i don't like TA.

BetaBeta February 1st, 2012
Report offensive content Reply (+22) (-2)

Whilst true, I'm failing to see any major needs for improvement roadwise (unless you count the increasing amount of freeways in the cities, but you should be smacking your state government for those).

CammCamm February 1st, 2012
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@chrispilgrim: "You're not a communist, are you?"

We're all familar with Godwin's Law, now let me introduce the Socratian Thesis:

Anyone who resorts to shouting 'communist', when they have nothing to contribute in a debate, automatically loses the debate AND the respect of their audience.

socratessocrates February 1st, 2012
Report offensive content Reply (+50) (-2)

As someone from SA, where the state government has let the roads deteriorate to 3rd world standards, I would love more money spent on roads, but I bet the vast majority of any money would be spent in the Eastern states, and very little (if any) in SA.

mcquademcquade February 1st, 2012
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Tony has made no secret of his preference for private over public transport. (“People (who don’t own iPads) prefer to drive themselves”). This is just another example of his reactionary view of the world.

His time has past. Why do his colleagues let him lead them? They are tarred with his views and don’t deserve to be elected to their respective constituencies much less be in government.

Meanwhile their simplistic blatherings stop attention being drawn to ways in which government services can really be improved. Opposition parties may be necessary for democracy but it would be nice to have a sensible Opposition. What hope do we have of that while Tony gets the media attention the more extreme and foolish are his ideas?

Richard UreRichard Ure February 1st, 2012
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Don't worry Tony, go back to using the tin cans and pieces of string.

The rest of us who actually understand technology, will forge ahead without you.

Please, spending billions on road/tax cuts won't increase our productivity in an increasingly connected world.

The 1960's called, they want their ideas back.

meck01meck01 February 1st, 2012
Report offensive content Reply (+33) (-3)

You mean he has now progressed to the 60's... wow!

BetaBeta February 1st, 2012
Report offensive content Reply (+32) (-4)

Abbott doesn't realise that by "reallocating" money raised from "bonds" to build the NBN to roads and tax cuts that he will actually increase the burden on the budget as the interest payments will then be on-budget rather than off-budget(and repaid by NBN revenue). He will then have the same "government debt" as there is now plus an even bigger budget deficit due to the interest payments. Secondly does he realise that he is going to borrow money to pay for tax cuts? Surely not! This has Hockey's fingerprints all over it!!!!

mstat_zmstat_z February 1st, 2012
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I think Abbot is onto something, more roads and better roads = faster sneakernet.

"Never underestimate the bandwidth of a station wagon full of tapes hurtling down the highway."

We will call it the National Sneakernet Network and we can use pigeons for our international links. It will be hella cheap! The money that's saved can be used to for blackjack and strippers!

JinglesJingles February 1st, 2012
Report offensive content Reply (+13) (-2)

Abbots idea for a super-highway.

SW_VictoriaSW_Victoria February 1st, 2012
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What NBN. After 4 years, 2850 lucky customers. For the rest, nothing.

Have they succeeded or failed? In the minds of the creators of the scheme, they have succeeded, because the heat was taken off the minister, and truely that is the definition of success for the NBN.

By all means the next government should retain the NBN, but not as the only solution for the country. Where private investment is willing, it should be encouraged and facilitated. The idiotic bureaucratic model of the NBN (all or nothing) has failed to deliver, and has even failed to deliver a simple timetable.

mikescmikesc February 1st, 2012
Report offensive content Reply (+2) (-48)

It's a 10 year build, grow up.

brakebrake February 1st, 2012
Report offensive content Reply (+31) (-2)

For those that regard the NBN Co solution as the only way just remember we did have a private sector company prepared to broadband up the country. Much as I would have hated them to do it - it was Tesltra, although looks like this government is now caving into them anyway.

Chrispil you are right re backhaul - although with the new legislation it is now very difficult for those towns on the 97% of landmass not falling in NBN Co fibre foot print that have been earmarked for wireless broadband (be thankful the Copper is no longer getting ripped up) to instal Ftth (much as many overseas FttH community networks have developed).

If only the industry only had a 7% ROR hurdle..... we could do fantastic things with the money being given to NBN Co.

RossyduckRossyduck February 1st, 2012
Report offensive content Reply (+3) (-36)

Incorrect Rossyduck (at least you are consistent)...

Telstra initially offered to "broadband up" the urban areas only, with FTTN. OPEL (Optus/Elders) was the rural alternative, remember? Remember too, "Telstra withdrew" from negotiations with the ACCC at the 11th hour, to the astonishment of the ACCC.

Then when given "another" opportunity to "broadband up" the entire country and renew their monopoly, via the first NBN plan/RFP's, they submitted a non compliant bid.

So "no" they weren't ever, prepared to broadband up the country (either country as in Australia or country as in rural)!

As for the rest of your spiel... sigh

BetaBeta February 1st, 2012
Report offensive content Reply (+33) (-2)

and Abbot could also have his roads.

RossyduckRossyduck February 1st, 2012
Report offensive content Reply (+2) (-32)

But But But...

The gov isn't spending money to build the NBN, it will be paid for by the users. All the gov does is provide access to bond rates of borrowing for the NBN, and users will pay back the interest.

I don't see how not building the NBN will save any money. Perhaps i'm not as wise as the Tony (or he is going against the interests of Australians in the future for a good sound bite?)

Paul KPaul K February 1st, 2012
Report offensive content Reply (+27) (-1)

I have been a liberal supporter for the last nearly 30 years. If Abbot doesn't get a grip on reality, or there isn't another leader by the time of election who does, then for the first time in my history this will swing my vote. I really thought I'd never see the day. Abbot can be proud.

When they say the majority of Australians don't want it, where are these guys getting their figures? In my conversations with customers, colleagues, friends and family I have yet to come across one that doesn't want it.

RamrunnerRamrunner February 1st, 2012
Report offensive content Reply (+27) (-1)

Oh Josh, slow news day was it yesterday. You must have known this headline would flush out the nerds. I see Hubert Humpalump and Betty are in full flight along with a whole bunch of new nerds.

DoubtDoubt February 1st, 2012
Report offensive content Reply (+2) (-27)

Yes, it is true they are here with their consistant pro labor stance but everytime with regards to the NBN they are correct.

The point still remains though with the article, its impossible to "save money" with the NBN as its being funded essentially on a loan as an investment and not out of the budget which is where road funds traditionaly come from.

BordZBordZ February 1st, 2012
Report offensive content Reply (+13) (-1)

BordZ, I think you will find that pro NBN does NOT automatically equate to pro Labor.

If the Coalition would simply enetr the 21st century (easy to do, dump Abbott) a lot of us would then consider them a viable alternative.

BetaBeta February 2nd, 2012
Report offensive content Reply (+24) (0)

Which '60's sitcom did Abbott steal the plot from? Addams family perhaps?
From the way he struts, his ideas manner & speech, is suggestive of Lurch in speedo's (shudder!!)

grumpgrump February 2nd, 2012
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Westpac board goes paperless with iPads http://t.co/kdm26Ewr via @zdnetaustralia

Cloud TVRs stop in wake of TV Now ruling http://t.co/2hLRUvt6 via @zdnetaustralia

RT @WauloK: Two cloud-based TV recording services have been suspended after Optus TV Now. http://t.co/VomMRrRs // @techwebcast Beem is dead.

ZDNet Patch Monday ep137 - Removing the anonymity from Anonymous: http://t.co/E6Tn8vJr

ZDNet Patch Monday ep138 - Anonymous 'crippled': where to for hacktivism?: http://t.co/lbKew6Bo

ZDNet Patch Monday ep139 - War talk dominates AusCERT 2012: http://t.co/rUm22Zjm

ZDNet Patch Monday ep135 - iiNet wards off AFACT, but what next?: http://t.co/0xVdYm6i

ZDNet Patch Monday ep136 - Blackhole crimeware as a service here to stay: http://t.co/evnCUlsX

GoogleTV will revolutionize television once viewers understand it http://t.co/c4lEyb3a

Reading this article is like stepping back in time. If I was Paul Berryman I would hang my head in shame. How embarrassing!!! I can’t b...

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Thanks for the response Luke, Given that the quotes are accurate, then the person in charge of the Vic Health App needs to find another j...

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I guess but in both cases, dead body!

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I think it's for the very reasons you mention in your first paragraph that there is no CBA. With the ideological differences and vested ...

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Hi there, just became alert to your blog through Google, and found that it is really informative. I am going to watch out for brussels. I...

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