Friday, March 05, 2010

Bright idea: Don't privatise the NBN - Kohler

"Communications Minister Stephen Conroy should do more than just remove from the NBN legislation the option for it to be a retailer – he should put in a clause that it will never raise equity or be privatised.

The NBN can, and should, be fully funded by government-guaranteed debt.

Its prices should be regulated to provide a margin over the cost of that funding to pay for management and maintenance, and then that’s it.

And those misty-eyed nostalgics within the government who want to create another PMG or Telecom Australia should be taken aside, arm on their shoulders, and counselled: get over it, the world has moved on, and it wasn’t really better then anyway.

This is an opportunity to build a great public asset that will turn Australia into a hotbed of innovation, but for that to happen the leash on the NBN needs to be very tight – forever.

NBN Co chief Mike Quigley has done the right thing by declaring that he will only provide a very basic bitstream transport service – called Layer 2. The legislation’s main purpose should be to make sure his successors in the future do the same thing.

Raising equity and/or privatising the NBN will set up a demand for growth – equity investors require capital gain as well as dividends..."

The full thing is at at Business Spectator

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