Telstra chairman John Mullen has described the NBN as a costly mistake that will send broadband companies out of business if prices aren’t changed.

Mr Mullen has told shareholders at Telstra’s annual general meeting that the firm should never have helped government create the NBN a decade ago because private enterprises were always going to build a high-speed network to serve the majority of Australia’s population.

He said the government could then have expanded the network to remote areas that companies had deemed uneconomic to build, resulting in a nationwide network at a fraction of the NBN’s $50 billion cost to the country.

Mr Mullen called for wholesale prices to be cut so that Telstra and others could make a profit by reselling access to the network.

“Australia already has some of the highest wholesale broadband pricing in the world, and if this trend continues, over time most resellers of the NBN will withdraw or go broke,” Mr Mullen said on Tuesday.

“The downside of this in turn will be fewer service providers and ultimately higher broadband prices to the consumer.”

Mr Mullen will also defend Telstra’s reworked remuneration report amid disquiet over chief executive Andy Penn’s $5 million pay packet.

Telstra was handed a first strike on executive pay last year and is expected to avoid a second on Tuesday.

“When I was younger almost every executive aspired to being the CEO of a big public company,” Mr Mullen’s speech said.

“Today there is a real risk that the media scrutiny, populist criticism and governance challenges are starting to lead talented executives to look for alternative career paths such as private equity where they can build their careers out of the spotlight.”

-AAP