A SCATHING review of Labor's troubled National Broadband Network rollout has found that the project would take three years longer to complete than promised while costing $29 billion more.

Cultural problems within NBN Co have also been identified, with unhappy staff, blame-shifting, soft hiring processes and mistrust in leadership hindering the rollout.

The massive blowout in costs has been partially blamed on an "unrealistic assessment" and "blind faith" in the corporate plan, which was overly optimistic.

But the report has also revealed that the Coalition will be forced to break its election promise of delivering download speeds of at least 25Mbps to all Australian premises by late 2016, with fewer than half now set to enjoy those speeds within that time.

media_camera Cultural problems ... former communications minister Stephen Conroy is chairing the Senate Select Committee hearing on the NBN. Picture: Gary Ramage

A radical overhaul of the rollout and organisation has been proposed, along with a new rollout based on mixing fibre and existing copper infrastructure that would be $32 billion cheaper and completed four years earlier.

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The previous Government's fibre-to-the-premise (FTTP) approach was to cost $44 billion and be finished by 2021, according to the 2012 corporate plan.

But the newly released Strategic Review, conducted by NBN Co with the assistance of independent consultants, says that won't happen until 2024 at a cost of $73 billion.

More than 1.1 million homes and businesses were to be passed by fibre by June 2014, but the revised outlook puts that number at just 357,000.

The review recommends using a mix of FTTP, fibre-to-the-node (FTTN) and hybrid fibre coaxial (HFC).

FTTN involves using fibre only to a specific node in each area, with existing copper infrastructure connecting the nodes to nearby homes.

Fewer than a third of homes will end up using FTTP, with about 45 per cent using FTTN.

Prior to the election, the Coalition promised an NBN rollout using a blend of technologies.

The strategic review says this will ultimately cost $41 billion - $32 billion less than Labor's rollout.

media_camera Strategic review: Communications Minister Malcolm Turnbull with Prime Minister Tony Abbott in Parliament yesterday.

If the new strategy is adopted, more than 40 per cent of Australians will get download speeds of 25Mbps by 2016, with about 90 per cent getting speeds of 50Mbps by 2019.

That same year, about 65 per cent of properties are expected to download files at 100Mbps.

Labor had promised speeds approaching 100Mbps.

After interviewing dozens of staff, the reviewers found that the culture and leadership within NBN Co were seen as a "major problem".

The hiring process "lacked rigour" and staff were fearful of contradicting superiors. It was noted that the general body of staff were committed to getting the job done.

They likened their workplace to "living in the political and media fishbowl" and expressed "mistrust in the motives of some leaders".

There was an unnecessary focus on using the number of premises passed by fibre as a key metric, instead of how many services were able to be activated.

People were also reluctant to document decisions because they were scared of future consequences.

Staff numbers are also an issue.

"The Independent Assessment considers the organisation is carrying a level of head count and overhead that has been predicated on the achievement of the volumes of rollout and activity in the corporate plan," the report notes.

"These volumes have not been, and will not be, achieved for some time and therefore the level of head count us not currently required."

Lower than expected take up rates also contributed to the blowout in costs.

Originally published as Anger over Labor's $29bn NBN blowout