After doubling the size of the deficit, the Abbott Government has now nearly doubled the cost of their second rate NBN.
The cost of the Coalition’s second rate NBN started out at $29.5 billion in April 2013, it blew out to $41 billion in December 2013, increased again to $42 billion in August 2014 and today it was announced that it will now cost up to $56 billion.
The financial return to taxpayers from the Coalition’s second rate NBN has also crashed. In December 2013, we were assured the rate of return would be up to 5.3 per cent. Today we learn it will be 3.5 per cent at best.
The NBN is rolling out slower than Malcolm Turnbull promised, and it is more expensive than he promised.
Malcolm Turnbull has no-one else to blame for this cost blowout. It has happened because he has made poor decisions and made the wrong assumptions. For example:
In less than two years under Tony Abbott, Joe Hockey and Malcolm Turnbull, the deficit has gone up, debt has gone up, unemployment has gone up and now the cost of the NBN has gone up for the third time.
They have doubled the deficit and almost doubled the cost of the NBN.
Australians are now paying the price for Tony Abbott and Malcolm Turnbull’s mistakes.
Australians will now pay much, much more for much, much less.
MEDIA CONTACT: RYAN HAMILTON 02 9790 2466
[i] Transcript, Press Conference: Tony Abbott (Leader of the Opposition) and Malcolm Turnbull (Shadow Minister for Communications and Broadband) Discuss the Release of the Coalition’s Plan for Fast Broadband and an Affordable NBN (9 April 2013); Malcolm Turnbull, cited in Ben Grubb, “Malcolm Turnbull expects new Telstra NBN deal in a 'few months,” The Age (21 February 2014), at: http://www.theage.com.au/it-pro/government-it/malcolm-turnbull-expects-new-telstra-nbn-deal-in-a-few-months-20140220-hvdaw.html
[ii] “Telstra’s revised NBN Definitive Agreements come into effect,” Media Release (26 June 2015), available at: email///www.telstra.com.au/uberprod/groups/webcontent/)(corporate/documents/document/uberstaging_295164.pdf">http: /documents/document/uberstaging_295164.pdf
[iii] Coalition Broadband Policy - Frequently Asked Questions (9 August 2013), at: http://www.malcolmturnbull.com.au/policy-faqs/coalition-broadband-policy-frequently-asked-questions
[iv] NBN Co Strategic Review (December 2013), Exhibit 4-2, page 97.
[v] NBN Co Corporate Plan 2016, page 60.
[vi] NBN Co Strategic Review (December 2013), page 83: “for NBN Co to extend its current OSS/BSS to support FTTN, the additional one-off cost is estimated to be $110-180 million. For HFC, this one-off cost is estimated to be an additional $70-110 million.”
[vii] “[NBN Co] will spent [sic] approximately $2.5 billion on IT capex by the 2021-22 financial year” (Malcolm Turnbull, Lessons from the NBN,” 11 June 2015, at: http://www.malcolmturnbull.com.au/media/lessons-from-the-nbn). Compare this to Turnbull’s $1.6 billion forecast for IT capex [to FY2024] under the previous model (NBN Co Strategic Review, page 66).
[viii] Transcript, Press Conference: Tony Abbott (Leader of the Opposition) and Malcolm Turnbull (Shadow Minister for Communications and Broadband) Discuss the Release of the Coalition’s Plan for Fast Broadband and an Affordable NBN (9 April 2013); Joint Press Release, The Hon. Tony Abbott MHR, Leader of the Opposition The Hon. Malcolm Turnbull MHR, Shadow Minister for Communications and Broadband (9 April 2013), copy available here: http://www.afr.com/rw/2009-2014/AFR/2013/04/09/Photos/057f48c4-a0c6-11e2-ba96-3567734839cb_13-04-09%20Joint%20Press%20Release%20with%20Turnbull.pdf
[ix] NBN Co Corporate Plan 2016, page 60.