No Quick Fix On USO, Says Union

Date: 27 March 2000

Proposals to open up the telecommunications Universal Services scheme to competition offered no quick fix to the problems confronting rural and regional Australia, officials of the Communications, Electrical and Plumbing Union said today.

Colin Cooper, President of the CEPU's Communications Division, said that the proposal to introduce competitive tendering for USO services was flawed and would involve increased risks for rural consumers.

"There's also a very real possibility that it could end up costing the community more than the current scheme," Mr. Cooper said. "Once you start duplicating infrastructure in loss making areas you are bound to end up with irrational results."

" At the same time, consumers will be exposed to increased risk. Telstra's service standards in these areas are not what they should be, " Mr. Cooper said, " but at least Telstra has an existing, highly reliable network in place throughout Australia."

" It also has deep enough pockets to carry the USO costs while the rest of the industry argues over what its share of those costs should be. What other carriers can offer this degree of certainty?"

Mr. Cooper also said that the proposal that Telstra remain as a carrier of last resort in areas where it no longer had the USO obligation was unrealistic.

" It is simply a nonsense to expect Telstra, especially since partial privatisation, to maintain unutilised assets in a state of readiness just in case one of the new USO providers gets its business case wrong and goes broke. In the end, it wont happen."

Mr. Cooper said that the Government announcement was clearly designed to ease rural concerns over full privatisation of Telstra.

"This is really just more sand being thrown in the National Party's eyes, " he said. " In fact, if you look at what the Government has said, it will be at least two years before any widespread tendering of the USO will occur. Rural customers, and those who represent them, would be wise to wait and see what the real benefits of this process might be before they accept any further sale of Telstra."

Mr. Cooper said that the CEPU believed that the current USO scheme, combined with continuing government ownership of Telstra, offered rural Australians their best chance of receiving reliable communications services at reasonable prices.

For further information

Contact:	Colin Cooper
Union:	Labor Council of NSW
Phone:	0419 037 057
WWW:	http://workers.labor.net.au/

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