IT Resource

The Federal Government has scrapped the controversial broadband tender process and has decided instead to form a new public/private company to build a national network as an infrastructure project.

Making the announcement today, Mr Rudd described the $43 billion fibre-to-the-home scheme as the single largest infrastructure project in the country’s history and said it would create 25,000 jobs a year during construction, with 37,000 in the busiest year of construction.

“It is the most ambitious, far-reaching, and long-term nation-building infrastructure project ever undertaken by an Australian government,” said Mr. Rudd.

The network will connect 90 per cent of homes to a network with speeds of up to 100 megabits per second, with the remainder connected at 12 megabits a second.

The Government would hold a majority share in the company, which will also be part-owned by the private sector, and will invest $43 billion into the project over eight years.

The Government will then gradually sell off it’s share of the company five years after the project is completed.

Mr Rudd said the company would inject a “new competitive force” into the telecommunications market.

“Today we draw a line under a decade of policy area and neglect,” he said.

“This solves once and for all the core problem created when the previous prime minister privatised Telstra a decade ago without ever resolving the conflict of a private monopoly owning the network infrastructure and dominating the retail market.”

Mr Rudd said the broadband tender process was being scrapped because none of the submitted bids offered value for money to the taxpayer, but said anyone was open to invest in the new company.

Telstra was dropped from the bidding process last December after the Government rejected its proposal.