Address to National General Assembly of Local Government

Wednesday, 24 June 2009

It is a real pleasure to be here among so many local government representatives from across Australia.

As a former Footscray Councillor myself, it is an honour to be addressing the National General Assembly.

Local government, of course, holds a special place in Australia’s democratic system.

It maintains a close interface with grassroots communities and is responsible for delivering a whole range of services vital to the normal function of our towns and cities.

Local governments face particular challenges when it comes to infrastructure, financing and sustainability – as is reflected in the theme of the General Assembly this week.

However, they are also instilled with that admirable Australian trait to recognise and make the most of opportunity, to deliver the best outcomes they can for local communities.

In my portfolio I am pleased to acknowledge the strong recognition of local governments about the importance of broadband technologies.

From my travels around the country, local governments and communities have constantly demonstrated a keen understanding about the potential of broadband to improve the way services are delivered and managed.

They recognise the potential for broadband to break down distance barriers for businesses and individuals.

Local governments and communities have demonstrated a strong desire to harness broadband to improve efficiency, drive productivity and generate new business and employment opportunities.

They have also demonstrated acute frustration about the lack of the essential infrastructure to enable these opportunities.

The local government position on this issue has been evident in the overwhelming support expressed for the Government’s plan to invest in the National Broadband Network.

As Geoff Lake, ALGA President, said on the day of our announcement on April 7:

"Local communities have waited too long for adequate broadband services and we are delighted with today's decision to invest such significant sums in expanding Australia's productive capacity and educational frontiers."

This sentiment is reflected in comments from a range of local government representatives.

Mayor Michael Tudhall, from Moorabool Shire in Victoria:

"The flow of high-speed internet to all pockets of the shire will make living, working and investing in Moorabool Shire increasingly attractive and viable."

General Manager Frank Zaknich, from Broken Hill City Council in New South Wales:

"The internet is the great leveler as it allows businesses in isolated areas to compete equally with those in metropolitan centres, and that’s the way it should be."

Mayor Bruce Scott, from Barcoo Shire in Western Queensland:

"This is probably the most important development on the table for rural and regional Australia for the next 10 years."

Brisbane Lord Mayor and Chairman of the South East Queensland Council of Mayors, Campbell Newman:

"The Council of mayors continues to see the delivery of broadband telecommunications infrastructure in South East Queensland as crucial to the long–term viability, wellbeing and sustainability of the region."

ALGA research has highlighted just how great the broadband opportunity is for regional Australia.

Indeed, it estimates $3.2 billion and 33,000 jobs are lost to regional Australia every year due to inadequate broadband infrastructure.

Local governments, it should be noted, have taken an active role to develop broadband in a number of communities around Australia.

This is certainly the case for Sunshine Coast Regional Council, which has won recognition by the Australian Telecommunications Users Group for its Connecting the Coast project.

Connecting the Coast incorporates fibre and wireless networks to link homes, workplaces, businesses, schools, hospitals and university facilities.

For a community looking to re-establish itself following the loss of a number of traditional industrial employers, the project offers a range of transformative possibilities.

It creates new markets for businesses and generates new jobs.

It enables locals to pursue further education and training while remaining in their communities.

It offers more convenient access to specialised medical services.

All of these things make the council region more attractive to investors and residents, invigorating the economy.

I note positive comments of the Sunshine Coast Regional Council about the potential for the National Broadband Network to build on the initiatives it already has underway.

"The key differentiator for Australia," the Council put forward in a recent submission, "is that the NBN can potentially be so much more than simply a National Broadband Network."

I understand that the council has already been working on a set of policies, regulations and associated initiatives that could be useful input to the National Broadband Network.

Clearly, the opportunities for regional Australia are acute and highlight the strong requirement for investment in our digital economy foundations.

Competition has been sorely lacking, impacting broadband availability, choice and price.

Indeed, the Government has made regional Australia a priority for the National Broadband Network and has fast-tracked a $250 million investment in regional backbone blackspots.

These links are the broadband highways that connect our cities, towns and rural areas to the wider world.

In parts of Australia – particularly links connecting our rural and regional areas – competition and capacity is limited as there is only a single provider of these services.

Broadband service providers have given a strong indication that improved backbone competition will allow them to expand further into regional Australia and deliver new options for users.

The Government has consulted widely on the locations around Australia that require competitive backhaul to unlock competition and new services.

The Government will very soon announce the regional locations that will be part of the first phase of the National Broadband Network investment.

We will be commencing a competitive tender process for rollouts under this stimulus investment with the expectation that construction begin as soon as September.

We want to move quickly to make these deployments and foster competition in regional Australia.

Can I stress however, that this $250 million is only the first phase of investment to improve broadband services and competition in regional Australia.

We recognise that after a decade of neglect there are many areas in regional Australia that require competitive backhaul to unlock the benefits of broadband.

As we move ahead with the National Broadband Network rollout, there will be further investment in the backbone infrastructure that is required to ensure that every regional centre and town has access to high speed broadband.

In addition, these links will be supported by a $5 million investment for Rural National Broadband Network Coordinators.

These coordinators will work closely with local communities to encourage broadband adoption and to put downward pressure on the affordability of services.

They will be assigned to specific regional areas and work closely with local governments and businesses to develop broadband innovation.

Clearly, as I have described, regional Australia is a high priority for the National Broadband Network.

However, it is important to note that inadequate broadband is not only a regional issue.

Poor and degraded infrastructure, and inadequate competition is a problem impacting services within and on the fringes of our largest cities.

Australia as a whole is in the bottom half of OECD countries for broadband take-up (16 out of 30 in 2008).

Australians pay more for broadband than most OECD countries (20 out of 29 in 2007).

Australian small businesses pay more than all but 2 other countries for fixed line services.

Our decision to invest with the private sector in the National Broadband Network recognises this poor standing.

It also recognises the bright opportunities we all have to attain real economic and social benefits via the national availability of affordable high-speed broadband.

For local councils there are direct efficiency and productivity benefits on offer.

Like a whole range of sectors across the economy, high-speed broadband offers a clear opportunity for local governments to transform the way they perform their important role in society.

Connecting council offices and depots with broadband offers the potential to better manage plant, infrastructure and workforces.

Broadband provides new ways for the community to engage with local governments and vice versa.

It offers new ways for the public to access public information and services such as libraries.

For the community and nation more generally, broadband promises a revolution in the way we undertake a whole range of day-to-day activities.

In health and aged care, the opportunities are profound.

Already we are starting to see the benefits of remote diagnosis and care, connecting patients in regional hospitals with specialists in capital cities.

Broadband tools are providing vital emotional welfare for young patients bed-ridden and separated from family and friends.

With widely available, affordable high-speed broadband we open the potential for further tele-health development.

This will become increasingly relevant as our population continues to age, in-home care raising new possibilities for caring for a population that expects independence.

In education, broadband promises a similar revolution.

It will certainly contribute in the same way to bridge the divide between metropolitan and regional services.

It will support virtual classrooms, video and audio streaming and high-definition video conferencing – helping students and teachers to work together and connect with the world.

It will expand the availability of university and vocational learning, providing new options for people in regional locations and otherwise separated from learning centres.

Broadband will also play an increasing role when it comes to managing assets and infrastructure – a topic I know is of particular interest to local government.

Broadband and connected technologies will reshape the way we think about infrastructure management.

In the energy sector, smart grids have massive potential to improve the efficiency of power consumption and the Government is investing $100 million to develop this sector.

More generally, digital technologies linked via broadband will improve the way assets are planned, constructed and maintained.

Smart infrastructure will be equipped with sensor technology to detect movement and deterioration.

The information will be monitored constantly allowing better timed and targeted responses.

Imagine a road that tells works departments when and where precisely it needs resurfacing.

It means better, more informed decisions can be made.

Smart infrastructure means longer-lasting constructions, more efficient resource management and a better return on investments.

Our own research entity — National ICT Australia (or NICTA) — is making smarter water supply infrastructure.

It uses sensor networks to monitor and control canal systems and make them more efficient.

In water field trials, NICTA demonstrated a 27 per cent improvement in water productivity.

The benefits of this, particularly in arid areas of the country, are obvious.

It highlights the far-reaching potential of broadband to make infrastructure smarter and to drive better outcomes.

It clearly highlights the transformative scope for broadband to drive innovation and productivity across the economy.

Indeed, there is a growing body of work that establishes broadband as a vital platform for future economic prosperity.

Just last month, Access Economics and IBM highlighted national high-speed broadband infrastructure is an important enabler for economic growth.

They recognised the significant economic growth potential of smart technologies and the likely creation of thousands of jobs.

They make a conservative prediction that adopting smart technologies in electricity, irrigation, health, transport and broadband would increase GDP by 1.5 per cent within ten years.

They suggest these investments would add more than 70,000 jobs to the economy in 2014 alone.

Access Economics has predicted high-speed broadband itself to increase the net present value of GDP by $8-23 billion over ten years; and create 33,000 jobs by 2011.

Just last Friday the Australian Computer Society tipped the creation of 55,000 new Australian jobs on the back of the National Broadband Network.

Another report by the Centre for International Economics said broadband could lift national economic output by 1.4 per cent after five to six years - the equivalent to $15 billion in terms of GDP in 2007/2008.

These figures emphasise the vital importance of ensuring Australia has the best possible broadband infrastructure to engage in the digital economy.

They demonstrate some of the key reasons that the Rudd Government is driving forward with its investment – with the private sector – in the National Broadband Network.

This project is of historic significance for the telecommunication sector and for our nation.

The National Broadband Network will be the single largest nation-building infrastructure project in Australian history and will transform our economy.

It will be Australia’s first truly national wholesale-only communications network.

It will drive employment and business activity in the short-term, helping stimulate the economy for our recovery from the global economic recession.

In fact, the Government expects the National Broadband Network rollout alone will create 25,000 jobs annually for the period of its eight year rollout, peaking at 37,000.

This means new business for local construction and contracting firms.

It means jobs for the people:

• digging the ditches,
• running the fibres,
• planning and engineering,
• connecting homes and businesses,
• supplying network hardware, and
• other related support activities.

The National Broadband Network also means jobs and business opportunities in the future.

It will form the platform for our future economy, ensuring we are best placed to capitalise in the years ahead.

Before the last election we committed to provide broadband to 98 per cent of premises delivering 12 megabits per second.

We have upgraded that promise to 100 per cent coverage of Australian homes, schools and workplaces.

You may be aware the new network will include a high-speed Fibre-to-the-Premises broadband network connecting 90 per cent of homes and businesses.

As a guide, this means that every town with a population of over about 1,000 will be connected by fibre.

This of course includes our regional centres, cities and towns right across the country.

However, it does not mean that towns with under 1,000 people will automatically miss out – as has been claimed.

Locations with less than 1,000 people may well be connected by fibre if their proximity to relevant infrastructure is favourable.

If small communities are well positioned in relation to backbone fibre links and other facilities, then it is very possible that they will be served by fibre.

Fibre coverage will be considered by detailed commercial and engineering studies as part of implementation planning.

For the 10 per cent of homes and businesses not reached by the fibre network, we are deploying next-generation wireless and satellite.

This includes the potential launch of new satellite technology to specifically meet our needs and achieve 100 per cent coverage of Australian homes, workplaces and schools.

These will be enhanced, next-generation services with upgrade paths offering services over and above the 12 megabits per second benchmark.

Experts agree that wireless and satellite will always be an important complement to fibre and that will be especially the case for large geographic spaces such as regional Australia.

The Government will work through implementation planning to ensure that these next-generation services provide the very best facilities for regional Australia.

The level of service and coverage will exceed our election commitment and represent a vast improvement on the services left behind by the previous government.

It means new opportunities for all Australians and establishes our broadband sector for the future.

Since our announcement in early April, the Government has been working quickly to kick-start this historic nation-building infrastructure project.

This has included discussions with key stakeholders, such as the Australian Local Government Association, and I look forward to continuing positive and constructive dialogue.

In fact, I would like to take this opportunity to invite the direct input of local government.

There will be formal opportunity for this input through a range of consultations, as well as the implementation study planning stage.

I look forward to guidance from local governments on this vital infrastructure investment.

I know an issue for of particular interest to all of you here today is how the rollout of the network may interact with local planning laws and impact on local environments.

The Government understands the sensitivity and we want to work cooperatively and constructively with local government on these issues.

We all recognise the transformative long-term benefits on offer and we should keep that in firm view as we undertake the rollout.

It is worth all of us considering what we can put into this historic project, as well as what we can gain, and as I have said, I am open to discussions on how that can happen.

Already it has been clear already that local government representatives are supportive of the rollout of a Fibre-to-the-Premises compared to our previous Fibre-to-the-Node proposal.

In the words of ALGA President Geoff Lake:

"From a local government perspective - putting aside a better outcome from a technology point of view - the fantastic news for local government is the refrigerator-sized cabinets that would been littered on nature strips have now been removed."

From the outset, the Government wants the National Broadband Network rollout – including the Fibre-to-the-Premises component – to be as unobtrusive as possible.

It may be that local government can assist in this regard by providing access to facilities they might control, such as ducts and rights of way.

We have indicated that where possible and cost-effective, fibre optic lines can and will be placed underground.

In other instances, aerial cabling may be faster and more cost-effective.

I know that many local governments have had experience with the rollout of overhead cables with the HFC deployments by Telstra and Optus in the mid 1990’s.

There has been some recent commentary recently comparing this experience with our planned rollout.

In this context, I note comments from John Turner, broadband chief at Alcatel-Lucent, that:

"The aerial deployment is definitely visually lower impact than HFC and the two shouldn’t be confused."

Dr Jonathon Spring, the architect of TasColt Fibre-to-the-Premises rollout in Tasmania told The Age:

"It’s a very attractive way of doing it in comparison to the way cable TV was rolled out because the fibre cable is very much smaller than the existing cable that people might be aware of from the Optus and Telstra rollouts.
It can be attached to the power pole much higher up because it does not pose the same sort of conducting threat.
There’s no visual pollution," he said.

Where necessary to facilitate the rollout of optic fibre, the Government has indicated it is prepared to amend existing carrier powers and immunities.

However, we intend to consult with stakeholders on any legislative changes and will give due consideration to community sensitivities.

As I have said, I welcome local government and others in the community to have their say through these consultations.

Additionally, the Government will expect the National Broadband Network Company to consult and work with carriers, utilities and local governments to facilitate the rollout in the fastest and most cost-effective manner.

One topic of interest is the scope NBNCo has to utilise road and trenching constructions as they take place to bury broadband facilities underground.

This would reduce engineering works and save money while resulting in the cables being laid out of sight.

This leads me to a consultation we are already undertaking on the topic of fibre network rollouts in greenfields property developments.

It is the Government’s intention that all greenfield property developments deploy FTTP technology from mid-2010 and we are in discussions now on the precise arrangements to achieve this goal.

Already, many property developers are forging a new path by deploying fibre networks at the same time as they lay the roads and connect other essential services.

This removes the need to retro-fit fibre to these developments in the years to come, while there is evidence to suggest Fibre-to-the-Premises contributes positively to property values.

In the US, a Fibre-to-the-Home Council survey found that a direct fibre connection adds more than US$5000 to the value of a home.

As Stephen Head, managing director of a new fibre-equipped suburb in Sandhurst in South East Melbourne has said:

"Feedback from our residents at Sandhurst is that the provision of ultra high speed broadband is a major attraction for business executives, home businesses, education and broader lifestyle considerations."

He estimates the cost of connecting greenfields properties to fibre links as the same as traditional copper wires.

In many ways local governments – along with forward-looking developers – have played a leading part in the deployment of fibre in greenfields areas to date.

It is worth noting the work undertaken by councils such as Brisbane, Playford, Ipswich and the Sunshine Coast, helping encourage these types of developments.

As reported in ALGA News recently, the City of Whittlesea in Victoria is a particular champion for fibre networks in greenfields developments.

Putting aside the considerable benefits for price, competition, employment, health, education and entertainment, the City of Whittlesea cites other big-picture opportunities.

These include:

• reduced cost of living;
• stimulated innovation; and
• a catalyst for the upgrade of brownfield areas.

By some estimates, around one million new homes will be built over the eight-year National Broadband Network rollout.

It makes sense that these latest property developments are equipped with the latest broadband technology.

It makes sense that they are enabled for emerging online opportunities such as:

• IPTV,
• community networks,
• e-health,
• e-education,
• smart power,
• home enterprise, and
• telecommuting.

This is of particular relevance on the urban fringe.

Last month, we released a consultation paper seeking stakeholder views on how the Government can best implement its greenfields policy.

We set out an approach for the Federal Government to work cooperatively and collaboratively with state and local governments to ensure that fibre is installed in new estates.

I note that a number of submissions emerged from the local Government sector and offer strong support for our aims.

Our consultation and discussions are looking at a range of important factors, including:

• costs and benefits,
• definitions,
• legislative requirements,
• possible exemptions,
• competition, and
• regulation.

Over 85 submissions have now been received and are being taken into careful account as we develop our approach to this policy proposal.

This includes the potential for further discussions with key stakeholders such as local governments, telecom carriers and developers.

As I have made clear, the willingness of the Government to engage with stakeholders and consult on the rollout of the National Broadband Network should not be understated.

Local governments, like the telecommunications industry, are rich with expertise and knowledge vital to our success.

Tapping this resource is a key goal for the Government as we continue to move towards the physical rollout.

I understand and welcome the level of interest and debate that the National Broadband Network is attracting.

I also recognise that consideration of many complex issues will be fundamental to the success of the network.

That is why, as I have mentioned, we are undertaking detailed implementation planning to establish the solutions and parameters for the project.

The implementation study will be extensive, including involvement from commercial, technical and legal specialists.

It will examine detailed engineering, commercial and structural issues.

The study will determine the operating arrangements, network design, and ways to attract private sector investment.

It will also look at ways to provide procurement opportunities for local businesses.

It will provide further opportunities for local government and other experts to share their views and expertise.

These views and the advice we receive will contribute to an integrated report on the implementation study for completion in early 2010.

Once again, thank you for the opportunity to be with you today to outline the government’s vision for our broadband-connected future.

It has been made clear that local government understands the need for bold action when it comes to delivering affordable, high-speed broadband on a national basis.

We need to act now to unlock Australia’s potential in the digital economy:

• to stimulate business and enable new growth in our regions,
• to support education and health innovation, and
• to improve the return on our infrastructure investments.

As I have said, I warmly welcome the positive sentiment and constructive interaction from the local government sector on this historic nation-building undertaking.

I look forward to a continued close relationship as we progress and deliver the Australia’s future broadband platform.

Thank you and best wishes for the remainder of the conference this week.

Thank you.