Protest over the sale of Telstra

Dear All,

Please find the time to send a message of protest to the following politicians expressing your concern over the sale of Telstra.

The Hon Simon Crean - s.crean.MP@aph.gov.au

Senator Richard Alston - richard.alston@dcits.gov.au or ralston@dca.gov.au

Senator Meg Lees - senator.Lees@aph.gov.au

Senator Brian Harradine - senator.Harradine@aph.gov.au

Senator Shayne Murphy - senator.murphy@aph.gov.au

For example:

Dear..............

We do do not wish you to sell Telstra.

The full privatisation of Telstra will mean that jobs, especially in rural areas, will become highly vulnerable. The level of foreign ownership in Telstra is likely to increase, it will no longer be Australian owned. Currently, half the profit that Telstra makes belongs to the public. If Telstra is sold its profits will no longer be directed to the public sector, they will be in the hands of a small number of wealthy individuals and institutions. Telstra will be driven and directed by the 'market' with no consideration to job security and quality public service.

The following article by Peter Murphy may also be of interest and use in developing your expression of protest over this issue.

Howard manoeuvres for Telstra sale

Prime Minister John Howard already has the Senate jumping at the prospect of the push to sell off the remaining 50.1% of Telstra that remains in public ownership. While the politics, especially with the Australian Democrats, is working for him, the global market for telecommunications shares is not.

The federal budget figures released in May show that the government hopes to sell the rest of Telstra next year for about $31 billion. But if the share price continues to tumble, under the impact of scandals like WorldCom, then the sale will be postponed.

To get the sale through the Senate, Howard must obtain the votes of all the National Party Senators, and at least four of the cross-benchers. Already the prime targets for ‘negotiations’ are Independent Senators Brian Harradine and Shayne Murphy from Tasmania, and two Democrat Senators - Meg Lees and Aiden Ridgeway. But the Nationals are not ‘in the bag’ yet.

Senator Lees is not credible when she says that the government will get to sell the rest of Telstra, but that she would not vote for the sale.

And the Nationals appear to be demanding further infrastructure investment in rural areas as the price of their support - something which Howard and Treasurer Costello are not yet ready to concede.

If Senator Lees gets to do a repeat of her GST deal, there are even brighter prospects for the Howard government than the $31 billion. For the consequence would be a massive rupture among the Democrats and perhaps a much more pro-government Senate, ready to move on with Howard’s anti-union agenda and anti-poor agenda in welfare and education.

It is worth reflecting on the fate of the call centres that Senator Harradine ‘won’ for his vote for T2, and on the environmental advances won by Meg Lees for her vote on the GST. Nothing that Harradine or Lees can gain from a vote for a T3 would outweigh the loss to the public interest from the ending of the public sector role in Telstra.

Howard’s strategy is highly vulnerable to a positive campaign for public ownership of Telstra in the bush, in the Democrat heartland of middle Australia, among unionists, and even among Telstra shareholders - already upset with T2.

While the Government - and Paul Keating - continue to airily assert that there is no national interest in a continuing government role in Telstra, in fact, keeping Telstra majority government owned is good policy. It means:

The government, and not the ‘market’, can continue to direct Telstra to lift service standards, especially in regional and rural areas, and for ordinary users everywhere.

The very drive to improve rural services - to justify full privatisation - comes from the government, not Telstra management. The shareholders of a fully privatised Telstra would rather see Telstra pay out big dividends than put money into the Australian network, as their recent behaviour shows.

Jobs

Telstra itself is a major employer in rural and regional Australia. These jobs, in areas that don’t make a profit, would be highly vulnerable after full privatisation.

Telstra is also the heart of telecommunications investment, research and development, and manufacturing in Australia. So far, Telstra and private licence holders have been required to continue to invest in the Australian industry. With Telstra fully privatised, and Australia under pressure from the World Trade Organisation to remove ‘barriers to investment’, this crucial investment in Australia could be dropped. Yet telecommunications is one of the key technologies for our future.

Majority Australian Ownership

At present, total foreign ownership in Telstra cannot be more than 35% of issued shares, and individual foreign investors cannot hold more than 5% of the company.

But all this could easily change. In fact, as part of the current round of World Trade Organisation talks, the European Union has demanded that Australia ditch these restrictions. While Telstra is majority Government-owned it is also majority Australian- owned. Let’s keep it that way.

More money for the public sector

Every year, Telstra makes a bigger profit than the year before. Last financial year, the profit was over $4 billion.

Under the current ownership structure, half of that profit belongs to us, the Australian public.

Of that $2 billion, around 60% is paid out in dividends to the Government, which can use it to fund health, education or even telecommunications projects. The rest goes back into Telstra to "grow" the company that we half-own.

Full privatisation means that this income stream is handed over to private investors - mainly the big institutions and a few rich individuals. After just a few years, we the public will be poorer - for ever more.

A Good Insurance Policy

Although Telstra is in good financial shape, around the world major operators are sinking under the mountains of debt they racked up during the telecoms boom.

The collapse of the US giant, WorldCom, is just the most spectacular example of the problem. In Australia, we have seen the failure of One.Tel. France Telecom is in such dire straits that the conservative French government now plans to buy back the 44% of the company that is privatised. Imagine if they had to buy back the lot.

Keeping the remaining 50.01% of Telstra in public ownership is good insurance for taxpayers.

Is Telstra really ‘half pregnant’?

Senator Boswell of the National Party now argues that it’s impossible to keep Telstra half-private and half-public. He can’t really explain why, but just asserts that "you can’t be ‘half pregnant’".

But under that ownership structure Telstra has emerged from this period of industry turmoil in very good shape financially. It certainly hasn’t been crippled by being majority government owned.

The agencies responsible for regulating Telstra’s behaviour, like the Australian Communications Authority (ACA) and the Australian Competition and Consumer Commission (ACCC), are independent from the government.

Their job is to administer the law - not to do favours for the Government of the day in Canberra - and they have given Telstra management a hard time. Public ownership hasn’t meant special favours to Telstra. z