Tuesday, May 14, 2013

Speed bumps halve NBN funds


Plagued by delay: The slow fibre expansion has been blamed on Telstra and contractors. Photo: Glenn Hunt

Labor spent about half what it forecast last year on the national broadband network, reflecting the sluggish pace of its rollout.

Labor will give the company building the national broadband network only $2.6 billion this financial year, yet in last year's budget, the government predicted it would give NBN Co about $5.8 billion over that period. Even in the midyear budget update last October, Labor was forecasting payments of about $4.7 billion.

It is understood it is spending less because the network is being built more slowly than expected.


Since publishing its first corporate plan 2½ years ago the company building the network has had to lower its forecasts several times.

In December 2010, NBN Co said it would "pass" nearly 1.3 million premises with fibre optic cable by next month. A dwelling is counted as passed when cable has been laid in the street, even if the home is yet to be connected to the network.

Last August NBN Co lowered its forecast to 341,000 premises passed by fibre. The company blamed the delay on nine months of negotiations with Telstra to decommission the telco's copper network.

Then, last March, NBN Co cut its target again by about a third.

The company said it would pass only between 190,000 and 220,000 premises with fibre by the end of next month.

This time, an NBN Co spokesman blamed the contractors building the network and, in particular the company Syntheo, which reported progress that "simply didn't match up to the activity we were seeing on the ground".

This budget, Communications Minister Stephen Conroy announced an extra $12.9 million in funding for digital training programs for small businesses and local councils to help them "take advantage of the NBN".

Of that funding, $7.2 million will be spent over three years to "help businesses engage in the digital economy" and $5.7 million will be spent over two years to "support local governments improve online service delivery".

More than 4500 people had completed the digital training and the new funding would pay for an extra 21 digital training services, Senator Conroy said. These would include virtual sessions for people living in remote parts of Australia.

The budget also revealed that this financial year, Labor will spend $4.9 million on advertising campaigns to "continue to improve public understanding and provide updated information about the national broadband network".

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