Steven Joyce has made his first really big stuff up.
He’s been forced to ditch the central element of his controversial anti-competitive Telco Bill. A 10 year regulatory holiday for the winner bidder of his $1.5 billion broadband scheme.
He’s had to replace it with what appears to be an even worse stitched together last minute compromise that has been forced on him by the Maori Party.
The compromise allows the Commerce Commission to regulate pricing on fibre, but if the Commission believes prices should go lower at some point, then Steven Joyce says it’s the Government that should wear the risk, not the consumer. And he’s the one who gets to make the decision on whether to regulate.
Why would he ever agree to regulate if it’s going to cost the Crown? And what is the nature of the compensation being promised to the contractor rolling out broadband? He had no answer for this when I asked him in question time today.
This effectively insulates the contractor from any risk and sets a dangerous precedent in terms of the Commerce Commission’s ability to fairly regulate. And if you don’t believe it go and look at NBR’s story this afternoon about Telecom’s shares going up. Certainty for them. Not the Crown. Which represents you the taxpayers. So Telecom’s shareholders get certainty, but the public still doesn’t. Wonder if the Maori Party gets that.
And I wonder what the Maori Party are getting in return for rescuing National’s troubled broadband bill? Interesting that they exercised their muscle. I don’t think they realise just how anti-competitive and flawed the Bill is and how many more problems there are with it.
I’ll blog more about this later.
I also wonder how Craig Foss, the chair of the Finance and Expenditure Select Committee feels about this deal. Pretty pissed off I reckon.
This policy is too important to be rushed through at the last minute via backroom political deals. It should have been dealt with through the select committee process with considered input from the industry, so everyone could examine it and create an enduring policy that works for the industry and consumers.
Instead Joyce looks stupid. His broadband scheme’s flaws are exposed and there’s more coming.
Labour will examine closely the detail of this last minute policy change, but we remain opposed to the Bill.
