Australian Government, 2009‑10 Budget
Budget

Part 3: Capital Measures

Broadband, Communications and the Digital Economy

National Broadband Network — initial investment

Capital ($m)
2008‑09 2009‑10 2010‑11 2011‑12 2012‑13
Department of Broadband, Communications and the Digital Economy - - - - -

The Government will make an initial investment of $4.7 billion towards an enhanced National Broadband Network.

The Government has established a company to build and operate a new National Broadband Network to deliver telephony and high speed broadband to Australian homes, schools and businesses. The preliminary estimate is that the enhanced National Broadband Network will cost up to $43 billion, with detailed engineering, commercial and structural requirements to be finalised through an implementation study to be completed by early 2010. Within the funding envelope, the Government's objective is to achieve 90 per cent coverage using fibre to the premises technology, with remaining coverage to be achieved through wireless and satellite technologies.

The company has been established under corporations law and will operate as a government business enterprise. Private investment will be encouraged but ownership caps will be established to protect the Government's objective of establishing a wholesale‑only open access network that is independent of retail providers. The Government intends to sell down its interest within five years after the network is built and fully operational.

The Government's initial investment includes $4.45 billion for an equity injection to the company that will build and operate the network and an investment in the early rollout of a fibre‑based broadband network in Tasmania. The profile of these investments is expected to be $30.0 million in 2008‑09, $750.0 million in 2009‑10, and $3,670.0 million in 2010‑11.

A further $250.0 million in 2009‑10 will be invested to upgrade regional backbone blackspots.

The investment is not expected to have a direct impact on the underlying cash or fiscal balances. The additional public debt interest cost incurred by the Government is accounted for in the budget papers. Provision for the expected public debt interest cost related to the Government's expected investment in the National Broadband Network over the forward estimates will be drawn from the Building Australia Fund.

Further information can be found in the joint press release of 7 April 2009 issued by the Prime Minister, the Treasurer, the Minister for Finance and Deregulation and the Minister for Broadband, Communications and the Digital Economy.

See also the related capital and expense measures titled National Broadband Network — implementation and establishment and National Broadband Network — regional backbone blackspots program in the Broadband, Communications and the Digital Economy portfolio.

National Broadband Network — regional backbone blackspots program

Capital ($m)
2008‑09 2009‑10 2010‑11 2011‑12 2012‑13
Department of Broadband, Communications and the Digital Economy - 250.0 - - -

The Government will provide $250.0 million in 2009‑10 to improve the supply of fibre optic transmission backbone services, also referred to as 'backhaul', to a number of regional centres where there is a lack of competitive backhaul services ('blackspots'). Stakeholder consultation on this initiative commenced in April 2009 to help identify and prioritise locations for investment, technical parameters and funding arrangements. These transmission links will put in place key infrastructure for the rollout of the National Broadband Network.

This forms part of the Government's $4.7 billion initial investment in the enhanced National Broadband Network and will be funded from the Building Australia Fund.

Further information can be found in the press release of 23 April 2009 issued by the Minister for Broadband, Communications and the Digital Economy.

See also the related capital and expense measures titled National Broadband Network — initial investment and National Broadband Network — implementation and establishment in the Broadband, Communications and the Digital Economy portfolio.

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