Budget 2010: Cost of managing NBN Co stacks up

Four Federal Government agencies have all received funding boosts in the 2010 Budget specifically for their role in managing or regulating the development of the National Broadband Network Company (NBN Co).

While its not a shade on the $43 billion cost of building the network, Government ownership of NBN Co will still cost the taxpayer some $44.3 million in oversight, regulation and auditing over the next few years.

Competition regulator the ACCC will soak up half the expense - granted $24 million to help manage the oversight of the National Broadband Network.

The Australian Competition and Consumer Commission flagged a need for more resources in March, hiring ten new staff to grapple with new regulations aimed at tackling Telstra's market dominance and the Government's attempt to build a new wholesale-only national network.

Budget papers showed that the specific cost of ACCC's oversight of NBN Co will jump from $3.3 million this year to $5.8 million for each of the next two years.

The ACCC will be charged with creating access arrangements for the Government-owned company, administering the NBN Co regulatory framework (including assessment of price and non-price terms and conditions for access), advising the Government and regulatory reporting.

The DBCDE said the cost of this regulation would be covered by annual carrier license fees, collected by telecoms regulator the ACMA (Australian Communications and Media Authority).

Joint stakeholder agencies the DBCDE and Department of Finance also received funding allocations to support their own regulatory oversight of the NBN.

The DBCDE secured $12.9 million over four years to fund "policy and regulatory support for the rollout, oversee construction of the regional backbone transmission links, and manage the Government's shareholding in NBN Co".

The Department of Finance and Deregulation has $2.1 million "to assist in managing the Government's shareholding in NBN Co".

A further $5.3 million was granted to the Australian National Audit Office "to meet the additional costs related to the financial statements audit of NBN Co Limited" for the next five years.

Budget papers explained that the Auditor-General is required by law "to perform financial statements audits of Commonwealth companies and their subsidiaries."

The Government expects to "fully recover" additional funding paid to the ANAO via audit fees paid by NBN Co.