Telecommunications (New Regulatory Framework) Amendment Bill

I move, That the Telecommunications (New Regulatory Framework) Amendment Bill be now read a third time.

The Telecommunications (New Regulatory Framework) Amendment Bill before the House is an outcome of the statutory review of the Telecommunications Act 2001 and many years of policy development and consultation. The passage of the bill has consistently received unanimous support from the House.

Can I begin by acknowledging the education and science and, I think, infrastructure—

💬 Jonathan Young: Economic development.

Economic development—your committee—for their consideration of the bill. The member’s committee, sorry—the Economic Development, Science and Innovation Committee. Can I also begin by acknowledging the work of the Hon Clare Curran, who held the position that I hold now before and, in essence, did predominantly most of the heavy lifting over the last 12 months. I’d like to acknowledge the work that she did in conjunction with our coalition partners, New Zealand First, in terms of the 111 vulnerable consumers aspect of this bill, the Chorus anchor price, and also for working on the regulatory framework and the additional Commerce Commission funding that was done under her tenure as Minister.

The bill provides for the modernisation of the Act and improved regulation of the New Zealand telecommunications sector by, in essence, doing six things: first of all, introducing a stable and predictable framework for the regulation of ultra-fast broadband (UFB) or fibre; secondly, removing regulation of copper fixed-line services where consumers have a choice to move to regulated fibre services; third, keeping regulation of copper fixed-line services where no alternatives are available; also, establishing and extending consumer safeguards, and providing more regulatory oversight of the quality of retail services; fifth, streamlining other regulatory processes to enable a rapid response to any competition problems; and, finally, repealing irrelevant and outdated provisions.

The whole environment in which the communications industry operates has changed radically over the past 10 years. By June this year, 70 percent of New Zealanders had access to UFB fibre, and uptake had reached 44 percent. The structural separation of Telecom New Zealand has led to a much more balanced market structure, with a flourishing retail sector. The new regulatory environment responds to these changes.

The wider consumer protections that the bill affords are a particularly important aspect of the bill and warrant further emphasis to the House. The bill establishes a wider role for the Commerce Commission. It will require the commission to monitor retail service quality and allow the commission to develop consumer codes for retail services, and to assess dispute resolution processes in the telecommunications sector. It will also establish a specific Commerce Commission code that requires retail service providers (RSPs) to identify vulnerable consumers, based on criteria specified in the Supplementary Order Paper (SOP) introduced in the committee of the whole House stage relating, for example, to health conditions. It will also provide options such as battery backup or alternative emergency calling providers for these consumers—

💬 SPEAKER: Order! Order! The member will resume his seat. I am going to remind the Minister of the prohibition on reading speeches. This is not a technical matter. It is not a first reading. Members are not allowed to read speeches.

Thank you, Mr Speaker, for your guidance. Also, the third criteria around retail service providers is to meet the expense of providing these options to vulnerable consumers—these things are very technical, Mr Speaker.

These are new roles for the Commerce Commission, and the bill augments the regulatory tool kit that the commission has available to it to protect New Zealand consumers. I, for one, am pleased, as the Minister, to report to the House that the Commerce Commission has been allocated a significant amount of funding—$12.3 million, in fact; I’m glad I have that information in front of me—over three financial years to implement the new regulatory framework that will be enabled by the bill, and has started the process of developing the rules that will govern the new regime.

The bill also provides new enforcement powers to the commission to ensure that the new codes may be progressed and enforced on a timely basis to meet consumer needs, and that new information disclosure obligations will be complied with.

Last week, during the committee stage of the bill’s reading, I did introduce a Supplementary Order Paper that ensures vulnerable consumers do have protection and the ability to make phone calls. If they are fibre-only consumers, in a power outage they may find themselves without any phone coverage to make a 111 phone call. I would like to acknowledge the member beside me, the Hon Tracey Martin, and New Zealand First for their work in advocating to make sure that those vulnerable consumers do have the ability to make a phone call, as I mentioned earlier, if their fibre is out and they don’t have those services available to them. So they will have a battery backup or, potentially, a mobile phone provided by the RSPs so that if there is an emergency, predominantly around health, they will have the ability to call a 111 service.

As I mentioned earlier, I want to thank both the Green and New Zealand First parties, our partners in Government, for ensuring that the most vulnerable consumers in our society have the ability to look after themselves in an emergency when they need them. This demonstrates that this coalition Government is committed to ensuring that the well-being of New Zealanders is at the heart of all we do.

There have been some concerns expressed about some of the provisions in the SOP that was tabled in the committee stage last week. The nature of the risks has been raised, and I think these need to be clearly understood. I will refer to my notes here, because I want to make sure we put this on the record in plain English: Enable, Ultrafast Broadband, and Northpower, who are three local fibre companies (LFCs) here in the country, face more competition than Chorus, and they face some competition from Chorus as well as players such as Vodafone and other RSPs. Therefore, they will not face price regulation in the first instance, and they may never face such regulation. Instead, they will be subject to information disclosure, a similar regime that operates under Part 4 of the Commerce Act, which our airports are exposed to. We believe in a light-handed form of regulation which requires them to share information about their businesses with the Commerce Commission. They will only be subject to more intrusive regulation if the Commerce Commission advises me that they can exercise a substantial degree of market power.

I would like to end my contribution again in the fashion that I started, by thanking the former Minister, the Hon Clare Curran, for a lot of the heavy lifting that was done during this process. As I say, it was a review of the Telecommunications Act 2001. Some work was done by the previous Government, but in our term of Government the heavy lifting was done by the former Minister, and I would like to extend my thanks to her for the way that it was done, especially in and around the anchor price for Chorus. That will give consumers certainty around the price of the anchor service around UFB for years to come—also Chorus some certainty—and I think that is one of the main benefits out of the work that was done in our time of Government, during the shepherding of this piece of legislation through the House. Thank you very much for the opportunity to speak to it, Mr Speaker.

Before I call Jonathan Young, I will draw the member’s attention to Speaker’s ruling 46/6, which I think is a very wise ruling.

Thank you, Mr Speaker. Can I say thank you very much for that very spontaneous speech delivered by the Minister, and can I also say thank you for your kind remarks to the Economic Development, Science and Innovation Committee, who did work very hard on, actually, quite a complex bill. I’d say it is quite difficult to criticise this Minister, because we are both members of the parliamentary cricket team, and that creates—

💬 Hon Kris Faafoi: Stop reading your speech.

Ha, ha! And that creates a collegiality, which I think sometimes is quite healthy for how Governments operate. He gets more runs than I do, and so I always have to hold him in high respect.

💬 Kieran McAnulty: Yeah, but you fall over more.

💬 SPEAKER: Order!

💬 Kieran McAnulty: I apologise.

💬 SPEAKER: It’s been a very long time since I played for the cricket team.

That’s right. I missed that remark but I sense I should be offended.

💬 SPEAKER: No, I’m offended on our behalf.

Right, thank you very much. So anyway, you know, we do support this bill. As the Minister said—and I’ll just acknowledge the Hon Clare Curran for her work—this has been a work programme that has been across parliaments. It’s absolutely critical for New Zealand, going forward, to have state-of-the-art connectivity that’s going to enable us not just to be able to enjoy that connectivity but to have very effective opportunities when it comes to education, when it comes to services that our communities and our Government provide for our communities, and also in the area of commerce—it’s incredibly important to be able to have that connectivity, not just domestically across New Zealand, but across the world.

It’s good to see that New Zealand is doing well in this particular area, and that comes through the effort of different parliaments, different Ministers, and different select committees. We all appreciate the fact that we can enjoy these things.

This past weekend I was visiting a town in the southern part of my electorate called Ōpunake. In fact, my wife and I stayed there for the weekend. We had won a prize at a fantastic bach that won New Zealand’s Bookabach national award just recently. So we went down there to enjoy small-town New Zealand, and as we drove into that town, there was a big sign that said “Ultra-fast Broadband (UFB) is coming in February 2019”—UFB is coming in 2019. So that’s the relevancy, sir, to say that here we are in small-town Taranaki with 1,000 people—the reach of this technology is going far and wide. That has got to have benefits for our high schools, our primary schools, our doctors, our medical centres, and our farmers who are out there who want to be state-of-the-art operators on our land. All of this is so important, and it’s one of the best things this Parliament has done for New Zealand homes, families, enterprises, schools, and hospitals, to create this connectivity to get information flowing.

I think, just as a brief comparison, where we sit in the world—I think it is interesting to know that we are doing reasonably well—

💬 SPEAKER: Order! Order! I am going to interrupt the member and to remind him we are on the third reading of this bill. It is not the second reading. It’s not a general discussion about UFB. It’s a discussion on this bill—maybe some comment on its progress through the House, but certainly, most of it should be on how the bill has emerged from the select committee. The member’s weekend or what happened in the rest of the world is not in this bill.

Thank you for your guidance, sir. I do think New Zealanders are interested in what’s happening in small-town New Zealand; however, I will continue on, looking at the bill as you have suggested.

💬 SPEAKER: Oh, the member’s tempting me.

One of the issues that this bill addresses is the balance between return on investment and also quality of service. It’s very, very important that we get this balance right, because we need to have the investment to get quality service, and it needs to be at a price where New Zealanders can afford it. So the anchor product is very much part of that—that we ensure that as many New Zealanders as possible can afford this service.

One of the things that we discovered through the progress of this bill was the issue in terms of poor consumer experiences with telecommunication services, which this bill goes some way to address. Consumer New Zealand’s recent survey highlighted that slower than expected broadband speed is quite frustrating. Secondly, disconnections or dropouts of internet services are also an issue. So these were some of the quality issues that this bill starts to address. It’s all well and good to have an ultra-fast fibre network, but it’s got to work, it’s got to be affordable, and it needs to be able to deliver the services to New Zealanders at an affordable price. So managing all of those tensions—and also managing the tension that corporations like Chorus face, in terms of having capability, wanting to stretch further into the retail market, but in doing that, because of their size and scale, threatening that retail market—is certainly an issue that this bill addresses, in terms of that line of division between the wholesale and retail market.

I’m very pleased to stand in support of the bill. I thank the Minister for the fact that they have highlighted vulnerable users. Yes, it’s a very important addition. I just want to acknowledge the Hon Tracey Martin for her advocacy in that particular area. I commend this bill to the House.

Debate interrupted.

Sitting suspended from 10 p.m. to 9 a.m. (Wednesday)