Labor policy could see NBN face fines for failures

A Labor government will establish an NBN Service Guarantee that will potentially see households and small businesses compensated if problems aren’t resolved within specified timeframes.

Under the new policy, if NBN doesn’t meet certain wholesale service standards for connection and fault repair timeframes or for missed technician appointments then it will face fines. NBN will pay those fines to its direct customers, the retail service providers (RSPs), that will then pass the money on to end users. Penalties will be more significant for services used by small businesses.

RSPs will be able to retain a portion of the fines for administrative costs; if the RSP provides a mobile broadband-based backup service for end users then they may be able to retain a larger protion of the money.

“These reforms have been designed to target underlying incentive structures that too often leave Australians stuck in a frustrating blame game, with no-one willing to take responsibility”, said Labor’s broadband spokesperson, Michelle Rowland.

“Our policy will make NBN more accountable to retail providers, so that retail providers can in turn be more accountable to their customers. We will place the consumers back at the centre and give them fair rights – that is what Labor governments do.”

Labor said that it would expand the remit of the Australian Competition and Consumer Commission to provide a “single line of regulatory oversight” for the NBN wholesale standards and the penalty pass-through mechanism.

Labor said the aim of the new policy wasn’t to punish NBN but to encourage better performance and accountability.

Communications minister Senator Mitch Fifield said that the ACCC was already examining the potential introduction of wholesale service standards. The ACCC in November launched its inquiry into the issue.

The minister also pointed to the Australian Communications and Media Authority’s move to introduce a range of new consumer protections for NBN end users.

The ACMA recently introduced new standards for telcos for handling NBN-related complaints.  Last week it introduced additional standards intended to prevent households being left without access to any broadband services if there are problems during the migration to the NBN.

The communications regulator also introduced a Consumer Information Standard intended to promote transparency about RSP’s NBN products.

NBN earlier this year launched a new transparency report revealing how it is tracking against a range of key metrics. According to the company’s figures for May, 90 per cent of faults are resolved with RSPs within agreed frameworks, compared to 59 per cent 12 months earlier.

Over the same timeframe, faults per hundred premises remained steady at 1, while 91 per cent of end users had their NBN connection ‘installed right first time’, compared to 86 per cent in May 2017.