Conroy’s Budget: A $400m NBN Blowout & $450M Surplus Fiddle
9 May 2012
The National Broadband Network is at the centre of Labor’s 2012-13 Budget cooked books. The Government’s claim of a meagre$1.5 billion surplus rest on shifting expenses forward from 2012-13 to the current 2011-12 financial year. Almost a third of the surplus comes from Senator Stephen Conroy’s creative accounting with the NBN.
According to the 2011-12 DBCDE portfolio Budget statement, spending on broadband by the Department was forecast to be $57 million this year. But in Tuesday’s 2012-13 portfolio Budget, this figure is revealed as having exploded to $484 million because inducements provided to Telstra for its deal with NBN Co have been brought forward as lump sums totalling $421 million to be paid out before June 30.
The funny money and financial irresponsibility doesn’t stop there. The sum Australian taxpayers are being forced to invest in the National Broadband Network between July 2011 and June 2014 has apparently blown out by $400 million, even though the NBN is at least a year behind schedule in its rollout.
Investment in those three fiscal years is now estimated to be $14.5 billion (according to page 23 of this year’s DBCDE portfolio budget) compared to a projected $14.1 billion in last year’s Budget for the same three years (according to page 19 of the 2011-12 DBCDE portfolio budget).
Yet the network only has 5000 or so customers currently using its fibre network, compared to the 137,000 projected by June 2012 in NBN Co’s Corporate Plan.
So taxpayers are paying far more for a rollout that has delivered a fraction of the promised connections.
The large increase in the equity required by this reckless project, combined with repeated refusals by Julia Gillard or Stephen Conroy to reveal how many households and businesses will actually be able to connect to the NBN network at the time of the next election, point to a blow-out in its expense and schedule.
Little wonder Labor has attempted to frustrate scrutiny of the NBN by Parliament and the Australian public at every turn. It is imperative Senator Conroy immediately releases a revision of NBN Co’s December 2010 corporate plan – fiscal honesty and policy transparency require it.
Sadly, the Government’s surplus fiddles and refusal to admit to spiralling costs for the NBN are not the only waste and irresponsibility in the Communications portfolio.
Not content with cheating taxpayers on what they get for funds invested in the NBN, Labor is also shovelling $20 million to “improve public understanding, address misconceptions and provide updated information about the National Broadband Network (NBN).”
And an additional $20 million goes to a “national online educational portal” to “help students, families and teachers take advantage of the National Broadband Network.”
Given NBN Co has already wasted so much money by hiring a vast public relations team and granting numerous contracts to PR and marketing consultants and other privileged insiders such as Labor’s preferred opinion polling firm UMR, Australians have every right to ask whether these funds will simply result in more pro-NBN propaganda.
Budget trickery and Labor spin aside, the Coalition notes the $158 million in additional funding to SBS to maintain the quality of their services and establish a national Indigenous Television service with Australia-wide coverage. Likewise, we note the $80 million six-month reduction in license fees for the free to air TV networks.
The Coalition will study these measures in detail before making further comment.