Video from ABC’s 7:30 can be watched here: http://www.abc.net.au/7.30/content/2013/s3799533.htm
Australian Broadcasting Corporation
Broadcast: 09/07/2013
Reporter: Greg Hoy
How will underperforming and financially troubled contractors as well as complaints of inadequate pay to others affect the rollout of Australia’s biggest infrastructure project, the National Broadband Network.
Transcript
LEIGH SALES, PRESENTER: Sticking with politics, the Federal Government has long spruiked its National Broadband Network as one of the main reasons it should be re-elected and a key point of difference with the Abbott Opposition.
But the project has been troubled. It’s already running well behind its original schedule and is struggling to meet its targets. Several major contractors appear to be in financial difficulty and subcontractors rolling out the network are angry they’re not being paid enough.
Tonight it seems there’s a peace deal in the pipeline to save Australia’s largest infrastructure project from falling even further behind. Greg Hoy reports.
GREG HOY, REPORTER: Anger in the trenches. In Seaford, South Australia, NBN subcontractors are not rolling out the National Broadband Network, they’re ripping it up.
BARRY PRINGLE, SUBCONTRACTOR, SA: This is what happens when you don’t pay your subcontractors on time and you just get basically fobbed off by the main contractor working for NBN.
GREG HOY: Subcontractor Barry Pringle is pulling out in protest over paltry pay rates for extensive work like this.
BARRY PRINGLE: The schedule rates that NBN are paying their subcontractors are so low it’s unable to build in the correct amount, or the industry standard.
GREG HOY: Will you take any other NBN contracts?
BARRY PRINGLE: Certainly not. It would send me broke.
GREG HOY: Such anger is equally obvious as NBN subcontractors now represented by the Communications Workers Union gather in Perth.
SUBCONTRACTOR: We’ve had it up to here. We want some more action to get us fair rates for our families and for our kids so we can actually turn a profit.
JOHN O’DONNELL, COMMUNICATION WORKERS UNION: The reality is NBN Co, the new Minister for Communications, the Rudd Government need to wake up, have a look at the pricing structures in this industry. They’re not designed to be viable. They are sending people to the wall. six of our businesses have gone to the wall in the last 12 months.
GREG HOY: It’s not just subcontractors and unions warning of problems hampering the NBN roll out. So as the competitive carrier’s coalition, representing telcos like AAPT, iiNet, Macquarie Tell come and Vodafone. The Coalition blames NBN Co itself, which it says ignored warnings that this would happen.
DAVID FORMAN, COMPETITIVE CARRIERS COALITION: When they designed those contracts in the first place, the NBN Co management persisted with terms and conditions on those contracts that didn’t respond to what they were hearing from industry. Issues around some of the timetables and expectations around cost and we’ve seen some of the problems that have emerged as a consequence when people have been unable to meet the roll out targets.
GREG HOY: The NBN’s problems don’t stop at the front line. Some of the NBN’s top tier contractors, which oversee construction appear to be in trouble themselves. In March NBN Co. was forced to sideline the Northern Territory’s tier one contractor Syntheo because the roll out was stymied. NBN took over control of construction. At the time NBN and the Government claimed this was a positive development.
STEPHEN CONROY, COMMUNICATIONS MINISTER: This will enable NBN Co. to take direct control of the roll out in the Northern Territory allowing Syntheo to concentrate its resources on the roll out in Western Australia and South Australia.
GREG HOY: But that’s not how it’s panned out. Syntheo is now facing more problems in Western and South Australia. Its venture partner Service Stream’s managing director Graham Sumner was recently forced to resign. Service Stream remains in a trading halt on the ASX as it reconsiders its involvement in the network. NBN Co. is facing pressure to axe Syntheo Service Stream all together.
PANEL CHAIRMAN: We call on NBN Co. to cancel all contracts with Syntheo/Service Stream for all work on the NBN.
GREG HOY: Neither Syntheo nor Service Stream were available to discuss this dispute but late today 7.30 was told that a peace offering has been made to subcontractors. It’s unknown if this proposed pay rise will affect NBN’s budget. Syntheo will be restructured, we’re told, so it can continue construction, but without its major partner Service Stream. Syntheo isn’t the only top tier contractor under the pump. In May, Peter Lamell, CEO of Silcar which is rolling out cable in New South Wales, Queensland, and the ACT was also forced to resign after cable contracts fell substantially behind schedule. The industry is alive with rumours about Silcar’s future with NBN.
SHANE MURPHY, COMMUNICATIONS UNION: I understand that there are senior meetings going on with NBN Co. executives and Silcar, as we speak, in preparation of hopefully some changes. ‘Cause what I’m hearing, if there are no changes to agreements between NBN Co. and Silcar, I don’t think we’ll see them survive the next 12 months to two years.
GREG HOY: Silcar did not respond to 7.30’s request for comment on its ongoing NBN plans. NBN Co. has a stated goal of delivering optical fibre to 93 per cent of Australian premises by 2021. Recently, it announced it had reached its politically sensitive, though radically reduced roll out schedule for the end of June. Many remain suspicious of the actual numbers connected.
JOHN O’DONNELL: You do hear bits and pieces that are misleading, especially announcements from NBN Co. telling people that you know, we’ve established these networks, they’re up and running. I’m sorry, but I go out there, I don’t see any connections to the premises.
GREG HOY: Added to these woes, recent reports suggest NBN is seeking to change its Chief Executive Mike Quigley. Mr Quigley has denied the speculation. Regardless, new Communications Minister Anthony Albanese is inheriting a can of optic fibre worms. Shadow Opposition Minister Malcolm Turnbull is merrily fuelling the flames.
MALCOLM TURNBULL, OPPOSITION COMMUNICATIONS SPOKESMAN: This project will require total funding from the Government of $94 billion.
GREG HOY: The Coalition’s alternative model is now costed at around a hefty $29 billion. So Mr Turnbull is keen to push the message that Labor’s $37 billion plan will cost much more than that. But the Coalition’s plan has hardly met with universal acclaim, not just because its new cable must connect to Telstra’s old and often dilapidated copper cables. Mr Turnbull has promised three inquiries into the NBN and there is widespread concern in industry that this may cause further delays.
DAVID FORMAN, COMPETITIVE CARRIERS COALITION: One of the things we’re most worried about is just as we start to hit the kind of critical mass of take up and roll out, the whole thing may shudder to a halt while plans are reconsidered.
GREG HOY: While we await the information superhighway, Australia has fallen to 21st out of 34 nations in OECD rankings for broadband. Meantime New Zealand’s fibre to 75 per cent of households will be completed in three years.
DAVID FORMAN: We have to acknowledge that the NBN is a massive, massive engineering task. Please don’t stop, just let it keep going. We don’t need six months dragging to 12 months, dragging to 18 months of nothing happening.
Comments are closed.
