Sue Lannin reported this story on Friday, November 16, 2012 18:21:00

MARK COLVIN: The chief executive of the National Broadband Network says much of the opposition to the high speed internet project is ideological.



Mike Quigley was out today selling the $40-billion infrastructure project to the business community in a speech to the Sydney Business Chamber.



He says the roll out of the NBN is being ramped up and more than 700,000 households are expected to be connected by Christmas.



Mr Quigley told finance reporter, Sue Lannin, that he didn't think the rollout had been too slow.



MIKE QUIGLEY: No I don't believe so. It's a massive project, biggest infrastructure project ever undertaken in Australia. Of course it takes some time to get this project going but we really are now making good progress.



We have commenced construction and just between April and October of this year of as many premises as we've done up to that date of April. So we really are now starting to hit our straps.



SUE LANNIN: Has it been a hard sell? Very much the NBN has been a political football. How hard has that been?



MIKE QUIGLEY: It's turned out to be a little more of a political football than I anticipated when I first started with the company but that's understandable. It is a large amount of money.



The reading that I've done of big government infrastructure projects, whether that's the Snowy Mountains Scheme or even the original building of the copper network that we've got today, every one of them were debated on political grounds when they got going.



SUE LANNIN: Do you think some of the opposition has been ideological?



MIKE QUIGLEY: I think people are entitled to different views and it is, it's quite possible for, especially for an incumbent operator to build, for example, a different network architecture but the government of the day has decided they want to restructure the industry, build a new fixed line network that will serve the country for decades to come and so I think NBN Co. is going about in the most efficient way we possibly can.



SUE LANNIN: Is the cost of the NBN too expensive? It's going to cost nearly $40-billion to construct. That's a lot of money.



MIKE QUIGLEY: Yes, there's no doubt. That is a lot of money but as a percentage of our GDP it's a fraction of what was spent by the government of the day when the copper network was built and a fraction of what the South Australian Government invested in the overland telegraph.



So, when you look at it that way, while it's a huge amount of money, it's also a very valuable piece of infrastructure which will last for decades and decades. The taxpayer will get a return on investment that they're putting into this network, a return that's above the long term bond rate, in other words, above the rate at which the government borrows money.



SUE LANNIN: The Federal Government had to pay Telstra $11-billion to transfer the copper network and the other assets. In retrospect, do you think it was a mistake to privatise Telstra?



MIKE QUIGLEY: No, I wouldn't say it was a mistake to privatise Telstra. I think both sides of politics will recognise that there probably should have been a solution to address the industry structure issue at the time that Telstra was privatising. Both sides of politics will recognise that.



So what's being corrected now with the NBN is that mistake perhaps that was made at that time.



SUE LANNIN: Now will the NBN be delivered on time and within budget?



MIKE QUIGLEY: Yes. We, as you know, the history of big infrastructure projects, whether they're by the way, whether they're government run or private run is not always good.



We're feeling reasonably happy with the progress we're making. We're aiming to finish the build of this network by mid-2021. That looks eminently doable and we're quite happy with the way we're progressing on costs.



These kind of exaggerated claims you hear about huge delays and overruns really are not accurate.



SUE LANNIN: What's been the biggest challenge in terms of getting the project going?



MIKE QUIGLEY: Well there's been challenges in obviously stabilising and getting final decision on things like what are called the points of interconnect. We had that discussion with the ACCC (Australian Competition and Consumer Commission).



There is obviously a lot of policy issues that needed to be worked out because this is a restructure of the industry and then of course it was the big deal we did with Telstra.



They all took time, as did sorting out all of the different databases around the country and getting them aligned so that we can design and build. They've all been challenges but they've now largely been addressed so we can get on with it.



SUE LANNIN: Why were the taxi bills so expensive last financial year - $1.5-million, you made about $2-million in revenue?



MIKE QUIGLEY: Yeah this is kind of, it's a silly argument to be frank. We've got now a large number of people building a network right around the country. This isn't by the way limousine bills we're talking about, nobody but nobody is allowed to travel in limousines in the company. We were criticised for taxi bills and train fares to do a job building a network throughout Australia.



MARK COLVIN: National Broadband Network boss, Mike Quigley, talking to finance reporter, Sue Lannin.