Labour will vote against the Telecommunications (TSO, Broadband, and Other Matters) Amendment bill and it will overturn sections of the new law if it is passed by Parliament next week, should it return to power at the next election.
The Bill is designed to enact the legislative changes necessary to roll out the government’s Ultra Fast Broadband network. The most controversial aspect of the Bill is the regulatory forbearance period - a so-called regulatory holiday - which would mean the Commerce Commission has no oversight on the network’s wholesale pricing until 2020.
In the media statement announcing the Labour’s opposition to the bill, spokesperson Clare Curran says that ICT Minister Steven Joyce believes it will cost an extra $400 to $600 million to build the network without the regulatory forbearance period.
Curran has released documents on Labour’s Red Alert blog site which include minutes from a meeting she had with Joyce, Labour finance spokesperson David Cunliffe and a ministerial adviser on April 12.
According to Labour’s report of that meeting Joyce said he would look into the Special Access Regime, but would make no commitments about changing it. Joyce apparently also dismissed the Commerce Commission’s submission that geographical average pricing for the copper network will raise prices for urban broadband subscribers during the transition to a fibre network.
Subsequent email correspondence shows Labour frustrated with Joyce’s lack of response to the Labour party's concerns. After sending an email requesting feedback, which he followed up with a meeting in parliament with the Minister, Cunliffe emailed to Curran on May 5:
“I indicated to him (Joyce) that we had been holding up our internal processes of consideration of the Bill pending hearing back from him and that our timelines could not be stretched for another ‘few days’. I asked him whether he could get us a definitive response by tomorrow. He told me he could not and that it would be ‘early next week’ at the earliest’,” Cunliffe writes.
Joyce has refused to respond to Labour's assertion that foregoing the regulatory forbearance period will cost the Crown millions and he remains unconvinced that the Special Access Regime is a viable alternative to the regulatory forbearance period.
"I have had a number of meetings with the Labour Party and have been interested in any constructive solutions they or others might have in terms of resolving differences on issues they have raised. Unfortunately they have not been able to raise any workable changes to date," he says in an email to Computerworld.
"Seeking to publicise their view of the discussions suggests to me they were not genuine in their view, and are more about playing politics on this issue than rolling out ultra-fast broadband for New Zealanders. I am not prepared to get into the detail of what I understood to be private select committee advice until after the Select Committee reports back."
After posting the Minister's response in this article, Curran emailed Computerworld: "To my knowledge it’s the only time he’s ever met with the Labour Party. The notes you’ve got reflect the outcome of that meeting. I typed them up immediately."
In the Labour statement today Curran questions the ability of Crown Fibre Holdings to negotiate with the companies – a mix of Telecom, regional lines companies and the Christchurch council-owned Enable networks – bidding to partner with the government in the UFB.
“The Government (through Crown Fibre Holdings) will act as both an investor and a quasi-regulator of the new fibre network. This creates a serious conflict of interest as CFH will be regulating its own investment,” Curran says.
“CFH lacks the independence and specialist skills to undertake such a task,” he claims.
Following a Labour caucus meeting yesterday, it was decided by Labour to announce its opposition to the Bill.
Today the select committee has been meeting to consider submissions, ahead of the Bill being put before Parliament on Monday.