Government's telco intervention "unprecedented" says TUANZ

Today's announcement by the government effectively puts the needs of Chorus's shareholders ahead of those of every day New Zealanders, says the chief executive of the Telecommunication Users Association of New Zealand, Paul Brislen.

The discussion document outlines three choices for the future of New Zealand's broadband market and all three include the Beehive setting the price for wholesale service.

"The government proposal sidelines the Commerce Commission and allows the price of wholesale copper broadband to be set directly by the Minister. It's a giant leap back to the bad old days of political involvement in the regulatory process," says Brislen.

The review of the Telecommunications Act was prompted by the Commerce Commission's review of Chorus's copper wholesale service (known as UBA) - a review that is required by law introduced by Steven Joyce when he was Minister of Communications in 2010.

"The Telco Act requires the Commission review the price Chorus charges for broadband on its copper network and the expectation is that it would greatly reduce the price for customers. What the government is doing now is removing that regulated process and replacing it with one where the price drops very little or increases substantially for internet service providers."

Such government intervention in a regulatory process is unprecedented in New Zealand political history, says Brislen.

"In the bad old days we used to see MPs debating the price of butter in the House. This is a return to that and worse - instead, we won't have the debate, the price will simply be set by the Beehive."

ENDS

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