Submission

Response to the Mobile Connect discussion paper

20 February 2006

  • Mr Ian James
  • Manager
  • Mobile Phone Initiatives Section
  • Department of Communications, Information Technology and the Arts
  • GPO Box 2154
  • CANBERRA   ACT   2601

Dear Mr James

Mobile Connect discussion paper

Thank you for the opportunity to comment on the design of the Mobile Connect program.

Telecommunications is an important issue for local government as it recognises the role telecommunications infrastructure plays in ensuring continued economic growth within Australia. It is vitally important that both state and local governments are consulted at this early stage and that their recommendations are considered thoroughly.

The Mobile Connect discussion paper outlines the proposed policy and design principles of the program and seeks comments on these principles. In its response to the discussion paper, ALGA has focussed on the threshold issues and those questions that are directly relevant to local government. As such we have identified a number of recommendations that we hope will be considered by the Department.

Yours sincerely

Ian Chalmers
Chief Executive

 

1. Introduction

The Australian Local Government Association (ALGA) welcomes the announcement of the Mobile Connect program that promised $29.5 million to extend terrestrial mobile phone coverage and continue satellite handset subsides for more remote areas. Mobile phones are fast becoming an essential service for all Australian communities particularly those in rural and remote areas.

The State of the Regions report for 2005-06 states

"It can be said that, as a driver of economic development in the 21st century communications infrastructure is as important as roads and railways were in the 19th century."

Local government supports the Australian Government's policy of encouraging an open and competitive telecommunications market and notes that many of the Australian Government's programs to date have been developed to support regional and rural Australia and remote areas where market forces do not guarantee services. Further, local government on some occasions has addressed market failures by meeting the telecommunications needs of its community itself.

The Mobile Connect discussion paper outlines the proposed policy and design principles of the program and seeks comments on these principles. In its response to the discussion paper, ALGA has focussed on the threshold issues and those questions that are directly relevant to local government.

2. How will the Australian Government achieve the greatest benefits from Mobile Connect?

The Australian Government has in place a range of programs that are designed to help rural and remote Australia achieve its telecommunications infrastructure goals. However, ALGA considers that the way the Australian Government funds ICT programs for rural and remote Australia is not as effective as it could be.

ALGA considers that Australian Government agencies often implement programs in a way that shows a lack of understanding of how effective, long-term change can be achieved in rural and remote Australia. The common funding approach used is competitive grants schemes. What ALGA has found is that these schemes often reward successful 'lighthouse' councils rather than those who are unable or unwilling to participate in grants schemes. Often rural and remote councils lack the staff expertise to complete successful grants applications and therefore miss out on funding opportunities.

A further difficulty with current programs is that are not sufficiently focused on achieving sustainable outcomes. In remote Australia economies of scale can not be achieved without the involvement of the whole community - individuals, businesses, community groups and local councils - and in more remote areas the 'whole of region' needs to be involved before outcomes become sustainable.

Recommendation 1: Adopt whole of region funding approach

To address these two issues, ALGA recommends that the available funding for Mobile Connect be allocated via a top down approach i.e. a 'whole of region' or a 'whole of state approach' that does utilises the expertise of state government will not excluding local councils or any other community organisations.

Supporting example:
The Local Government Association of the Northern Territory's NT Connect project has demonstrated the benefits of such an approach.

This project which was funded through the Networking the Nation Local Government Fund and took a 'whole of territory' approach to delivering 'reliable and appropriate IT infrastructure and business systems for Community Councils.'1 This approach included providing and maintaining the telecommunications infrastructure required by the councils. The long-term success of this project will depend on Territory and Australian Government agencies using the ICT infrastructure established by LGANT. Without this support the sustainability of LGANT's network will require continual subsidies. Only a 'whole of government' approach which involves all levels of government can provide sustainable telecommunication solutions to remote communities.

1 http://www.lgant.nt.gov.au/lgant/home/member_services/it_services/projects/nt_connect

It is also important to note that whilst it is reasonable for the Australian Government to expect that everything that can be done to ensure sustainability be done. However, the Australian Government must acknowledge that even if you are being strategic there are some services that will always need support.

Recommendation 2: Align to other funding programs within an overall strategic framework

If Mobile Connect is going to be a success it needs to be developed in the context of a plethora of other funding programs that have been developed to help improve the capacity of rural, regional and remote communities - including Rural Transaction Centres, IT training and technical support programs, Coordinated Communications infrastructure Fund, Higher Bandwidth Incentive Scheme, and Centrelink services to rural Australia. Whilst these programs are important and have made a difference to remote Australia, the range of programs demonstrates a lack of coordination and the absence of a strategic framework. Consequently, rural and remote communities are suffering because of the ad hoc nature of government funding programs. Without a more coordinated approach to the delivery of ICT funding, the Australian Government will not see the outcomes it hopes for.

Recommendation 3: Publicly funded infrastructure should be accessible to all mobile carriers

Local government is also concerned with the accessibility of infrastructure to all mobile carriers. If Mobile Connect is going to meet its aim of developing a competitive and open market than the program principles should include a principle that ensures that publicly funded infrastructure (eg. towers) of a non-active nature is practicably accessible by other mobile providers/competitors in the market, without process, financial, or regulatory barriers preventing access.

In summary, to achieve the greatest benefits from Mobile Connect, the program needs to be allocated on a 'whole of region'/'whole of state' approach, coordinated with other programs, funding needs to be strategic and not allocated on an ad hoc or competitive basis and scale (particularly in remote areas) and a strategic context needs to be of greater consideration when designing the program. Further, any resulting infrastructure must be practicably accessible to the open market on an equitable basis.

3. How can the Government maximise additional opportunities for terrestrial services arising from changed market structures, co-funding arrangements and linkages with other Australian Government programs?

Recommendation 4: Establish an effective program governance structure

As discussed above, if the Australian Government is going to maximise additional opportunities for terrestrial services through linkages with other Australian Government programs a coordinated approach is essential. ALGA suggests that a secretariat be established to coordinate the development of a national strategic framework to guide the implementation of all the programs under the broader umbrella of Connect Australia. This secretariat would be established as a sub-committee of NBSIG and would consist of staff from DCITA, state and territory agencies responsible for telecommunications, local government and sector representatives who would be seconded to work full-time on ensuring that the allocation of funding under Connect Australia is both strategic and coordinated.

In regards to market structures and co-funding, ALGA is not in a position to comment.

4. Proposed program priorities

Recommendation 5: If a choice has to be made, focus the outcomes on community access

In general terms, ALGA recognises the Australian Government's need to determine priorities given that the amount of funding for Mobile Connect is finite. However, making a choice between coverage to additional small population centres or providing additional coverage along regional highways is essentially a choice between road safety and community access. Issues of isolation and safety on highways are of great concern to local governments as is the need for people to have mobile access in population centres but if a choice needs to be made, ALGA would support bolstering coverage in small population centres.

5. Local government's ability to support Mobile Connect

Recommendation 6: Do not expect councils to contribute financially to the Mobile Connect program

Local government on some occasions has addressed market failures by meeting the telecommunications needs of its community itself.

Despite this, it is important that all spheres of government recognise that telecommunications is the responsibility of the Australian Government and that whilst other spheres of government may choose to participate in addressing market failures to ensure that its community does not miss out, it is unacceptable to insist that local governments contribute to jointly fund programs.

Local government has a very limited capacity to contribute to new responsibilities and there is considerable evidence that local government is facing a financial crisis. Three major reports - the Commonwealth Grants Commission review of the Local Government (Financial Assistance) Act 1995, the Fair Share report, and the Rising to the Challenge Report2 - have provided extensive evidence that many local governments, especially those in rural and remote Australia are in significant financial trouble and part of this is as a result of other spheres of government cost or responsibility shifting on to local government.

2 A Report produced by the Financial Sustainability Review Board in South Australia (August 2005)

The Fair Share report, released by the House of Representatives Standing Committee on Economics, Finance and Public Administration in October 2003, highlighted the extent of cost shifting noting that it was already costing local government between $500m and $1.1 billion per annum. It also outlined the growing frustration amongst councils that programs such as these call them into areas with which they are not familiar because they are keen to ensure their communities do not miss out.

Whilst we would never advocate that councils not be eligible or participate it is unreasonable for the Australian Government to expect councils to contribute financially to this program.

In essence, it is unlikely that councils will want to contribute financially to joint projects however; individual councils will make their own decision as to whether they participate in the program. As indicated above, the nature of the Council areas being considered for such programs is that Councils are usually the only community co-ordination resource but they do not have under-utilised staff expertise. Participation even only with "staff time" represents an opportunity cost for those communities and sometimes will compete for attention with other Australian Government priorities and programs.

6. Local government's ability to develop proposals

Recommendation 7: Recognise local government's desire to participate in multi-site proposals

As stated above, local government's ability, especially in rural and remote Australia to develop proposals, is limited. Local governments generally do not have expertise in this area and would rarely develop a proposal without the assistance of others. As such, local government is more likely to be involved in multi-site proposals rather than an individual proposal. ALGA would support multi-site proposals especially if they focussed on regional solutions rather than just population centre solutions.

7. What types of technologies are local government/communities interested in?

Recommendation 8: Recognise local government's limited knowledge in the area of mobile technology and its desire to secure metropolitan comparable services at affordable prices for its communities

Most of our members want their communities to have access to mobile technology and would hope that the best and most enduring technology be made available, however as a general rule local governments are not experts in forms of technology. At a minimum, local governments would expect metropolitan comparable services at affordable prices.

8. Conclusion

In conclusion, local government recognises the importance of telecommunications to regional economies and supports the Australian Government's desire to develop and open and competitive market. For the Mobile Connect program to be a success, the following principles should be considered when designing the program:

  • ad hoc competitive grants schemes do not encourage sustainability nor do not they help those councils that are in the most need;
  • projects need to include as many individuals and organisations as possible, especially local councils and need to be developed on a 'whole of region' or 'whole of state' basis if they are to be sustainable;
  • recognise that some projects (especially those in remote Australia) will never be self-sufficient and that arrangements should be made for this;
  • the implementation of the Connect Australia initiative needs to be strategic and programs need to be delivered in coordinated way;
  • program principles should include a principle that ensure that publicly funding infrastructure is practicably accessible to the open market on an equitable basis;
  • program priorities should focus on community access;
  • local government's capacity to financially participate is limited and any insistence that they do constitutes a cost shift; and
  • local government does not have the capacity to develop proposals in its own right

 

Contact regarding this submission

Larissa Karpish
Assistant Director, Ageing, Finance and Economic Policy
Australian Local Government Association
Tel: 02 6122 9427   
larissa.karpish@alga.asn.au

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Page last updated: 26 February 2006