-The competition regime is failing, the regulatory regime is incredibly complex and cumbersome. Services in the bush are inadequate, and Australia is falling behind the rest of the world on broadband uptake," said Shadow Minister for Communications, Lindsay Tanner, in an exclusive interview with ZDNet Australia.

-We remain steadfastly opposed to [full] privatisation of Telstra and would vote against any legislation bought before parliament," he said. -It would lead to a giant private monopoly that would extend its reach into other markets, and concentrate on profitable segments at the expense of less profitable areas."

The discussion paper released by Tanner, -Reforming Telstra", received support from telecommunications analyst Paul Budde. It outlines the Opposition's problems with Telstra and some possible solutions, including the structural separation of Telstra. However, Tanner emphasised that the paper was for discussion and was not Labor policy.

-We have no preferred position at this point," he said. -We are in a policy review process which will culminate in the national conference sometime next year. The discussion paper was just that, a discussion paper intended to spark a broad national debate in telecommunications in Australia."

Senator Alston entered the debate by claiming the proposal would sell off the high-growth assets of Telstra while leaving the least profitable infrastructure in government hands, which would have to compensate current shareholders. Telstra finance director John Stanhope told a Senate inquiry that a structural separation would destroy up to AU$13 billion of shareholder value.

-Mr Stanhope was misleading the Senate, because the report he was referring to was accounting for the Government's proposals, and only mentioned structural separation indirectly," Tanner said in response. -It was a brief, sketchy observation without any supporting research."

-When BT announced it planned to structurally separate itself, the share market reaction in Britain was quite benign. They ended up doing something else, but it's a good indication there is no reason to assume any particular reaction of the share market."

Tanner believes the Government will attempt to sell Telstra before the next election. -It's a red hot certainty," he said, adding there was nothing the Liberals could offer that would induce Labor to support the legislation.

-I believe a privatised Telstra would be too powerful to regulate and it would not be possible to guarantee high quality outcomes to regional Australia and consumers in general," Tanner said.

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