Labor ‘wasted $20b’ on roll-out of NBN 

Communications Minister Malcolm Turnbull has accused the former Labor government of wasting up to $20 billion on the rollout of the National Broadband Network, but says the money lost could have been more than twice that amount.

The Coalition on Thursday released a strategic review of the NBN, which found that under Labor’s plans the rollout would miss its 2021 target by three years and cost $73 billion – up from $43billion – to complete.

The Coalition plans to deliver a fibre-to-the-node NBN, a slower but less expensive version of Labor’s fibre-to-the-home plan.

Mr Turnbull said the NBN should have cost $15 billion to $20billion  ‘‘had you approached it the right way from the start’’.

 ‘‘The cheapest way to complete this from where we are now, starting from the mess Labor’s left us in, is $41 billion,’’ he told Sky News yesterday.

 ‘‘So I think you can say very plausibly, very reasonably, that there is ... between $15 [billion] and $20 billion of value wasted.  And if you’d... continued down Labor’s route you’d be talking about wasting well over $50 billion.’’

A spokesman for Mr Turnbull said the $15 billion to $20 billion construction figure was based on estimates by former Telstra chief executive, Sol Trujillo, in 2008.  

In 2005 Telstra estimated upgrading its copper network to fibre to the node in five capital cities would cost about $8 billion and asked the Howard government to contribute $2.6 billion.  

However, Telstra’s estimate of network upgrade costs doubled to $15 billion by 2008, when the Rudd government was looking for a commercial partner to upgrade broadband around the  country.    

Telstra tendered for Labor’s fibre to the node network, but was thrown out of the process because it submitted an incomplete bid.  The lack of cooperation from Telstra was one of the reasons Labor set up NBN Co. The recent strategic review also found the new government would not be able to meet its pledge of delivering 25 megabits per second (Mbps) to all Australians by 2016, and its NBN plans would cost 40per cent more than the $29.5 billion estimated in April.

Mr Turnbull said he didn’t  ‘‘feel any shame’’ about the government’s inaccurate  forecasts.

 ‘‘They were [cost] estimates done in the best of good faith from opposition,’’ he said.

Opposition communications spokesman Jason Clare said Mr Turnbull was  ‘‘throwing numbers around without evidence to distract attention from the fact that the Coalition has broken another major election promise this week.’’

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