Jul 24, 2013

Transcript of doorstop interview – Brunswick

Subjects:  NBN switch on for Brunswick; NBN contracts; Manus Island; Election; Productivity.

ANTHONY ALBANESE: Happy to take questions.

QUESTION: [Indistinct]… blowout to the costs of the NBN?

ANTHONY ALBANESE: Well, it’s – there’s some interesting claims or non-claims. If you look at the detail in The Australian newspaper today, there’s a headline that doesn’t actually match what’s in the detail. What we have had with the NBN is – as occurs with infrastructure projects – is some disputes over – between contractors and sub-contractors. Some people are essentially using the front page of The Australian no doubt to try to up how much money they get. Well, you know, hold the front page. People who deliver infrastructure want more money to deliver that infrastructure. Hold the front page.

No different from any other project anywhere. The NBN is running on time and on budget. We’ve produced that documentation for June 30. It met all of its targets.

QUESTION: Minister, there’s talk that you’ve spent 12 per cent of the overall capital budget of $37.4 billion, that you only got two per cent of [indistinct] actually passed by the NBN. I mean, can you actually still stay on track when there seems to be the hardest yards ahead?

ANTHONY ALBANESE: Well, Annabel Hepworth, who wrote that article today actually understands infrastructure, and I can’t believe that such a silly statement can be made about infrastructure. It is like suggesting that when you build a road, a section of road, that there’s a uniform level of infrastructure spend compared with usage.

What happens when you build a road is you spend 100 per cent of the funds before you get any usage at all. What happens with an infrastructure project such as this is of course the infrastructure spend in establishing the projects is higher at the beginning, and as it is rolled out, you get more people coming online, and it doesn’t occur in a uniform way. It occurs in a way in which this month there will be more people switched on than there was last month. And next month there will be more than this month. And next year there will be more than this year. And the year after that, there will be more.

This is really quite an embarrassing statement, frankly, for anyone who knows anything about infrastructure development to make. The fact is that the NBN in terms of the timeline as well as the cost is running completely in accordance with the projections that were given.

QUESTION: What do you say to the contractors that are saying that they need to be paid up to 40 per cent more to sort of break even on general profit margins on the project.

ANTHONY ALBANESE: Well, what I say is that that’s a matter for the NBN and contractors and sub-contractors, but this is no different from – if you get someone to come to do the smallest infrastructure bit of work in your home, guess what? They’ll always ask for more and that is the way the system works. It’s called a profit-based system and people who are companies tend to want more money to do the task that they’re contracted to do.

QUESTION:  Are you confident that some contractors are being paid enough for getting [indistinct] with work when they’re doing NBN contracts that they’ll be able to support their families?

ANTHONY ALBANESE: This isn’t a compulsory exercise. We haven’t gone out there… NBN Co hasn’t gone out there and said, we are conscripting you to engage in this process. This is a process not unlike any other area of infrastructure work. We have contractors and sub-contractors. What the Government doesn’t do is intervene in those processes to engage in that level of micro-management, nor should we.

NBN Co has been tasked with the rollout of the NBN. It is occurring on time and on budget and it shouldn’t be of any surprise that with a project of this size, of course from time to time there will be disputes, and those disputes will always be – you know what the surprise would be – and hold the front page for this, the surprise would be to have a contractor who says, I’m being paid too much for any project that’s being rolled out, be it National Broadband Network, road, rail, ports, water infrastructure, energy infrastructure, I’m being paid too much and I’m going to give money back. That would be a page one story.

QUESTION:  So are you actually disputing that the contractors rates are too low? Do you think they’re fair?

ANTHONY ALBANESE: Look, that is a matter for NBN Co and contractors and sub-contractors. That’s not a decision for the minister. These are commercial arrangements.

QUESTION: Have you had any complaints to your office or to your department?

ANTHONY ALBANESE: Well, I certainly have not had it raised personally with me.

QUESTION: What about to your office?

ANTHONY ALBANESE: In terms of, you know, is it the case that someone has rung someone in my office in Marrickville, I don’t know whether that’s a case or not. I’m saying to you that I have not had it raised with me personally.

QUESTION: Will you be seeking talks with the NBN about this issue, sort of to resolve it?

ANTHONY ALBANESE:  NBN Co’s negotiations with contractors are commercial negotiations, and are a matter for the parties to resolve.

QUESTION: Changing topics slightly, you’ve already been asked about the process of replacing Mike Quigley, and obviously you said that’s a matter for the company themselves. But do you have a view on whether it’s appropriate to name a replacement prior to the election?

ANTHONY ALBANESE:  I have seen no impediment towards decisions being made. The National Broadband Network is being rolled out, the National Broadband Network is being switched on for more homes here in Brunswick today. That is a decision for the board. Politics should not get in the way of this project.

QUESTION: Have they got a shortlist yet [indistinct]…?

ANTHONY ALBANESE: That’s not a matter for me.

QUESTION:  Can I change topic again, why, even though battery packs have been optional for people getting on the NBN installation for a year now, how come people have still been forced to get an enlarged attery pack?

ANTHONY ALBANESE: I’ll refer technical questions to NBN Co.

QUESTION: Changing topic, can I just ask about Manus Island, and the allegations coming out of Manus Island – sexual assaults have been reported?

ANTHONY ALBANESE: Well, any allegations should be dealt with, but they’re just allegations. My understanding is that there was a matter raised a week ago, the minister asked for further information on that, and that wasn’t received.

QUESTION:  When’s the election?

ANTHONY ALBANESE: On a Saturday. Some time in accordance with the constitution, and some time before or after Souths win their 21st premiership.

QUESTION: [Indistinct]

ANTHONY ALBANESE: Well, there’s some interesting claims or non-claims. If you look at the detail in The Australian newspaper today, there’s a headline that doesn’t actually match what’s in the detail. What we have had with the NBN is – as occurs with infrastructure projects – is some disputes over – between contractors and sub-contractors. Some people are essentially using the front page of The Australian no doubt to try to up how much money they get. Well, you know, hold the front page. People who deliver infrastructure want more money to deliver that infrastructure. Hold the front page.

No different from any other project anywhere. The NBN is running on time and on budget. We’ve produced that documentation for June 30. It met all of its targets.

QUESTION: Minister, there’s talk that you’ve spent 12 per cent of the overall capital budget of $37.4 billion, that you only got two per cent of [indistinct] actually passed by the NBN. I mean, can you actually still stay on track when there seems to be the hardest yards ahead?

ANTHONY ALBANESE: Well, Annabel Hepworth, who wrote that article today actually understands infrastructure, and I can’t believe that such a silly statement can be made about infrastructure. It is like suggesting that when you build a road, a section of road, that there’s a uniform level of infrastructure spend compared with usage.

What happens when you build a road is you spend 100 per cent of the funds before you get any usage at all. What happens with an infrastructure project such as this is of course the infrastructure spend in establishing the projects is higher at the beginning, and as it is rolled out, you get more people coming online, and it doesn’t occur in a uniform way. It occurs in a way in which this month there will be more people switched on than there was last month. And next month there will be more than this month. And next year there will be more than this year. And the year after that, there will be more.

This is really quite an embarrassing statement, frankly, for anyone who knows anything about infrastructure development to make. The fact is that the NBN in terms of the timeline as well as the cost is running completely in accordance with the projections that were given.

QUESTION: What do you say to the contractors that are saying that they need to be paid up to 40 per cent more to sort of break even on general profit margins on the project.

ANTHONY ALBANESE: Well, what I say is that that’s a matter for the NBN and contractors and sub-contractors, but there is nothing new with people who are no different from – if you get someone to come to come to do the smallest infrastructure bit of work in your home, guess what? They’ll always ask for more and that is the way the system works. It’s called a profit-based system and people who are companies tend to want more money to do the task that they’re contracted to do.

QUESTION: Are you confident that some contractors are being paid enough for getting [indistinct] with work when they’re doing NBN contracts that they’ll be able to support their families?

ANTHONY ALBANESE:  This isn’t a compulsory exercise. We haven’t gone out there… NBN Co haven’t gone out there and said, we are conscripting you to engage in this process. This is a process not unlike any other area of infrastructural work. We have contractors and sub-contractors. And the Government – what the Government doesn’t do is intervene in those processes to engage in that level of micro-management, nor should we.

NBN Co have been tasked with the rollout of the NBN. It is occurring on time and on budget and it shouldn’t be of any surprise that with a project of this size, of course from time to time there will be disputes, and those disputes will always be – you know what the surprise would be, and hold the front page for this, the surprise would be to have a contractor who says, I’m being paid too much for any project that’s being rolled out, be it National Broadband Network, road, rail, ports, water infrastructure, energy infrastructure, I’m being paid too much and I’m going to give money back. That would be a page one story.

QUESTION: So are you actually disputing that the contractors rates are too low? Do you think they’re fair?

ANTHONY ALBANESE: Look, that is a matter for the NBN Co and contractors and sub-contractors. That’s not a decision for the minister. These are commercial arrangements.

QUESTION: [Indistinct question]

ANTHONY ALBANESE:  Well look, we have a discussion this afternoon with the Business Council of Australia and the ACTU together. It’s the third time that the leadership has sat down with the BCA, and we’ve also sat down the same number of times with the ACTU leadership.

What’s pretty clear is that we’re a Government that’s committed to uniting the nation, not dividing it. The way that we unite the nation is by ensuring that employers and employees work together in the national interest. You can have extraordinarily good outcomes, and you’ve already seen a significant reduction in the number of disputes that have occurred under this Government compared with the former Government.

We’ve also seen much fairer workplaces and a fairer workplace system as a result of the abolition of Work Choices.

Maybe also, one of the things that both the Business Council and the ACTU are interested in, are issues such as infrastructure development. The business community are strong supporters of the NBN, they’re strong supporters of the way that productivity can be advanced. And that is also supported by the union movement, who are concerned about making sure people have security in their jobs.

A week ago I launched, with the Australian Industry Group in Rosebery in Sydney, essentially an information kit, that the AIG will roll-out – half a million dollars in funding. Which is about how small and medium manufacturing enterprises can use the NBN to ensure that there’s jobs growth and that their businesses can compete across Australia, but more importantly compete with the world.

A couple of weeks ago I was here in Bendigo, in Victoria, at Keech Engineering talked to them about the advantages that they can have by being able to upload, not just download, large, complex files using new technology through the NBN to be able to maximise employment and economic growth.

So, these are all issues of interest to the business community, the union movement, and to the Government. We have common interests in improving our competitiveness, and that is, I think, the sort of areas that the discussions will go to this afternoon.

Thanks very much.

QUESTION: One last thing, what’s the mood like in the Caucus since the change of leader?

ANTHONY ALBANESE: We had a very successful Caucus meeting on Monday. I think importantly, it’s about the Caucus, but it’s also about the community. And I think that the community have embraced the change that occurred.

There is certainly more sense of optimism. And that fact that we have a Government that is concerned about the future, that’s concerned about making sure that we give people hope, that we support opportunity through programs such as the National Broadband Network. Through the Better Schools plan, through Disability Care Australia, through the range of initiatives, that we have a positive plan for the future.

And I think increasingly what we’re seeing from the Opposition is just more negativity. Even when the Opposition come out and say that they support a measure, such as they did in terms of the local government referendum – they all voted for it. Ever since then Tony Abbott and Christopher Pyne, and others, have talked it down.

So even when they say yes, they end up saying no. And when it comes to the arrangements that we’ve come to with PNG, in order to stop tragedies at sea, and we’ve seen another tragedy played out in the last 24 hours, which highlights once again the need for a policy response in order to deal with the changed circumstances that we’ve seen in the people smuggling business. When that was announced, Tony Abbott’s first response was to welcome it. Ever since then he has tried to undermine it by sending a message to the people smugglers that criticises the plan that is there.

Now, that is not acting in the national interest. Tony Abbott continues to be the most negative political leader that Australia has seen. And I think that as people weigh up the options in the lead-up to the election, then the sense of optimism that is now there from Caucus members, and it doesn’t say that we will win the election, but certainly says that we can win the next election.

It’s important that this National Broadband Network continued to be rolled out. That it not be, you know, half done with what’s a second rate, out of date plan that is essentially – for the same cost in terms of equity injection into the project.

Thanks very much.

[ENDS]