CANBERRA: Australia’s Parliament is set to reject a plan to split phone giant Telstra, opposition lawmakers said, in a setback for a $37 billion government program to build a super broadband network spanning the nation.
The legislation, due in the Senate next month, aims to force the former state-owned monopoly to separate its retail and cable network arms, and commit vital cable assets to the plan to push super-fast fiber-optics into almost every home.
Communications is a hot-button issue for Australians, with even many people living in major cities enduring broadband speeds far below those of other advanced economies.
Reuters polled government, opposition and minority-party senators over the past week to gauge support for the new plan in the upper house Senate, where the government is seven votes short of the majority needed to pass the Telstra legislation into law.
The government had pinned its hopes on the opposition Nationals party for passage of the legislation on the grounds that the broadband plan will benefit the Nationals’ rural heartland, where broadband access is patchy. But party MP Bruce Scott said this assumption was wrong, arguing that many remote rural areas were likely to miss out on the broadband program and that city voters would reap almost all the benefits of the country’s biggest infrastructure project. “Telecommunications is a right of all Australians, and the government is talking about leaving out the vast mass of rural and remote Australia,” the pro-farmer conservative MP told Reuters.
Defeat for the legislation would be a setback for Prime Minister Kevin Rudd that could lead to early elections, following on from Senate rejection last year of controversial emissions-trade laws.
The faster network was a central promise that helped propel Rudd to election victory in 2007, painting then-ruling conservatives as telecommunications luddites opposed to infrastructure that would boost national productivity.
A defeat could also dent the value of Telstra shares held by 1.4 million Australians, many of them mum and dad investors who bought into the company as a retirement nest egg during a privatization masterminded under conservative rule.