Life Tech NBN levy will be an ‘unfair’ cost for customers, consumer advocates say

NBN levy will be an ‘unfair’ cost for customers, consumer advocates say

nbn levy
Mitch Fifield and Malcolm Turnbull have not managed to free the NBN from controversy. Photo: AAP
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An NBN levy on Australian broadband companies will be passed on to consumers through higher internet prices, internet consumer advocates claim.

The so-called Regional Broadband Scheme was announced by Communications Minister Mitch Fifield on Monday, just weeks before the government looks certain to miss the deadline for the NBN rollout promised by Malcolm Turnbull three years ago.

Senator Fifield’s office said the $7.30 (per fixed line, per month) connection levy would contribute $40 million annually towards introducing the much-needed NBN to regional areas of Australia, calling it a “fairer” way to spread the cost of the embattled project.

But an Australian Communications Consumer Action Network (ACCAN) spokesperson told The New Daily that the levy could be damaging to poorer consumers.

“In the long run, funding these services through a levy on the NBN and other fixed networks … may impact low-income consumers who may find services too expensive to afford,” the spokesperson said.

“Other networks that provide consumers with broadband services, such as mobile and fixed wireless, will not be charged this levy. This is unfair and may create an uncompetitive market.”

In 2013, Mr Turnbull, then the shadow communications spokesman, pledged the NBN would be fully rolled out by the end of 2016.

Despite the target having been pushed back to 2020 some time ago, Labor has this week been keen to point out that seven million Australian homes and businesses are still without NBN just 18 days before the deadline, and that complaints have risen sharply for those who do have the very fast broadband.

A spokeswoman for Senator Fifield denied budget or schedule blowouts, saying the project was now connecting 100,000 homes to the NBN each month.

The senator’s office dodged questions regarding the timing of the levy announcement, including whether it was geared to get lost in December’s political dead zone.

Levy to hit consumers

Under the Regional Broadband Scheme, NBN competitors such as broadband provider TPG will be slugged with a levy of $7.30 per fixed-line connection.

Smaller telcos servicing less than 2000 customers will be exempt from the levy – which will climb to $8 per line in 2022 – as will Telstra and Optus, which are making the transition to the NBN.

Senator Fifield’s spokeswoman said the NBN rollout will be completed by 2020, “six to eight years sooner than would have been the case under Labor”.

Labor’s NBN plan

The Coalition has repeatedly promised its NBN plan will be cheaper than Labor’s original proposal.

nbn levy
The Abbott government cut back the cost of the NBN dramatically. Photo: AAP

But in the nine months to March 2016, the NBN’s expenditure totalled $2.2 billion – compared with $1.5 billion for the same period in 2015.

Earlier this year, the 2016 federal budget revealed the much-maligned project would soon run out of money, with an extra $29.5 billion “expected to be fully utilised by the end of the 2016-17 financial year”.

The Coalition, particularly while under Tony Abbott, has been criticised for failing to listen to technology experts in the formulation of its NBN plan.

In particular, the government has come under fire for failing to transition to fibre-to-the-premises (FTTP) connections rather than the technically inferior fibre-to-the-node (FTTN) – despite similar costs and the fact that countries like the US are making the switch.

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