Telstra has labeled rival Optus' national broadband network bid 'sub-prime' after calling into question an alleged $8 billion funding hole.
Telstra has labeled rival Optus' national broadband network bid 'sub-prime' after calling into question an alleged $8 billion funding hole.
The telco, which lodged a conditional proposal to build the NBN, said Optus needed to "stop playing games" and reveal how it will fund its $15 billion bid.
It added that Optus needed to comply with disclosure rules laid down by the Australian Securities Exchange.
"The disclosure rules are clear - if Singtel Optus has made an actual, material commitment of capital to the NBN, then it needs to be disclosed to the ASX," Telstra said in a statement.
"When it lodged its NBN proposal on Wednesday, Telstra clearly disclosed its intentions to the ASX, including the fact that it is willing to commit up to $5 billion in capital to the project if the required enablers are put in place.
"Assuming Singtel Optus is complying with the disclosure rules, the fact that it has not made any such ASX disclosures can only lead to one conclusion - it has not made any financial commitment of its own capital to the NBN project."
The telco added that with Optus' bid costing $15 billion and the government contribution of $4.7 billion, it would leave a $10 billion funding hole.
"Even if Singtel Optus can be believed that it is putting $1 billion to $2 billion into its NBN proposal (less than 20 per cent of the non-government cost), this still leaves an $8 billion funding hole," Telstra said.
The telecommunications carrier finished by saying it was the only "serious builder of the NBN".
Earlier this week, Telstra said it was unable to lodge a formal bid because of a lack of clarity over the issue of structural separation.
The announcement is pasted below:
Building a National Broadband Network (NBN) is serious business so Singtel Optus must stop playing games and reveal where the money is coming from for its $15 billion NBN proposal.
Singtel Optus has indicated it will cough up $1 billion to $2 billion for its $15 billion NBN proposal, but two days after revealing its plan, it still has not made any financial disclosures to the Australian Stock Exchange (ASX).
The disclosure rules are clear - if Singtel Optus has made an actual, material commitment of capital to the NBN, then it needs to be disclosed to the ASX.
When it lodged its NBN proposal on Wednesday, Telstra clearly disclosed its intentions to the ASX, including the fact that it is willing to commit up to $5 billion in capital to the project if the required enablers are put in place.
Assuming Singtel Optus is complying with the disclosure rules, the fact that it has not made any such ASX disclosures can only lead to one conclusion - it has not made any financial commitment of its own capital to the NBN project.
With a bid cost of $15 billion and a maximum government contribution of $4.7 billion, this means there is a $10 billion funding hole in the Singtel Optus proposal.
Even if Singtel Optus can be believed that it is putting $1 billion to $2 billion into its NBN proposal (less than 20 per cent of the non-government cost), this still leaves an $8 billion funding hole.
Every day Singtel Optus refuses to say how its NBN proposal is being funded, the more it looks like the sub-prime NBN bidder.
Australian needs a world-class NBN built by those with the financial capacity, the technical capability and the proven record to take on one of the largest infrastructure projects in the nation's history.
Australia cannot afford a sub-prime NBN funded with dodgy or non-existent money and left in the hands of those who always promise big but never deliver.
Singtel Optus has an abysmal investment record in Australia. It built a cable network it prefers not to use. It suspended its wireless broadband offering when it could not deliver on what it promised to customers across Australia.
The Singtel Optus-headed OPEL consortium had to forsake $950 million in taxpayers' money when the Government ruled earlier this year that it could not meet its funding benchmarks.
Telstra is the only serious builder of the NBN. It is the only company that has committed serious capital to the project and disclosed that commitment to the ASX.
