UFB2 looks good but does it all add up?

Posted 26th Jan 2017

Taxpayers should be asking where is the money coming from for the second phase of the Governments ultrafast broadband scheme announced today, says Labour ICT spokesperson Clare Curran.

In 2014 the Government promised $210 million for the second phase of UFB, to be paid for from the Future Investment Fund which is already oversubscribed. Almost three years later they have increased the cost by another $100m which they say is tacked onto the original UFB allocation.

“This sounds like creative accounting and the indications are that Chorus has played hard ball to get the biggest share of the deal on its terms.

“Many communities that are struggling now with poor connectivity are going to have to wait until 2023/24 to get UFB, which is a lifetime in Internet years.

“The UFB2 roll-out looks good on paper but it may prove to be a white elephant as competitors move to deliver a better service than a trouble-plagued and stalled Government programme.

“A new law before Parliament, which will likely pass through the rest of its stages to become law early next year, allows electricity lines companies to string broadband fibre along electricity lines, which will enable immediate regional development opportunities for all of rural New Zealand.

“The new law is not existing Government policy and occurred through a Select Committee process driven by the opposition parties, right under the nose of the Minister while negotiations for the UFB2 were stalled.

“As a result, Chorus may now find itself outflanked by electricity lines companies eager to deliver fibre faster for their regions than the state programme’s timetable. What is the point of Chorus being subsidised to inefficiently overbuild fibre where smaller, more agile providers have already laid fibre or have announced their intention to do so?

“Under the Government’s programme, those living on the fringes of Auckland, Taupo, Rotorua, Napier/Hastings, Upper Hutt, Nelson and Queenstown will have to wait until 2024 to get fast fibre. If you live in Kaitaia, Warkworth, Wellsford, Otorohanga, Whangamata, Kaikoura, Culverden, Waimate, Waikouaiti and many more towns, you’ll be waiting until 2023/24 to get connected.

“The fact is that other competitors are likely to deliver fibre faster than the state-funded programme, which leaves taxpayers asking whether this money is well spent.”
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