Trujillo Tells Canberra To Make Up Its Mind

Sydney Morning Herald

Thursday June 14, 2007

Lisa Murray

TELSTRA chief executive Sol Trujillo has stepped up pressure on the Federal Government, calling for a decision on a new high-speed broadband network within weeks.

If the Government fails to meet Telstra's "timeliness test", the company would spend its $4 billion on other projects, Mr Trujillo said in a letter sent to staff yesterday.

"We are not engaging in this process to 'develop' or 'refine' or 'negotiate' a plan," he said.

"We have a plan in place that reflects negotiations and discussions with the Government that are now complete."

His comments are likely to frustrate the Government, which is expected to announce details of its new broadband plan any day. The plan, which has already been ticked off by cabinet, includes setting up an independent expert panel to assess rival bids for a fibre-optic network in the major cities.

Last week Mr Howard warned Telstra against making threats.

"That's the sort of counter-productive conduct which has properly provoked criticism and resistance from the Government in the past," he said.

Mr Trujillo said yesterday that he supported the Government's proposal for a new process to "break a regulatory log-jam".

"However, if the process that is put in place strings out a decision over months rather than weeks, it will not meet the "timeliness" test that our leadership team has to meet in order to make this year's capital allocation deadlines."

Telstra's rivals claim there is no way a decision can be reached within weeks. The independent panel would first set the terms and conditions for a public tender process and then companies would be invited to submit their applications. The whole process would almost definitely take months.

But Mr Trujillo said yesterday Telstra had already negotiated a plan with the Government.

Mr Trujillo also said that while it was up to the Government to appoint experts to the new panel, he hoped it would "exclude people who have already embraced one approach or another in the ongoing debate".

Telstra has said previously it does not believe the Australian Competition and Consumer Commission should be involved in the new process. It claims ACCC chairman Graeme Samuel has backed a rival bid from the Optus-led G9 consortium. However, Treasurer Peter Costello has insisted the ACCC be involved.

The Government, keen to gain the upper hand in the broadband debate, will also announce as soon as this week the provision of up to $900 million in funding to improve internet speeds and access in the bush.

The bulk of that money is expected to go to Telstra's rival Optus.

© 2007 Sydney Morning Herald

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