The Federal Government office responsible for issuing infrastructure bonds suggested it was excluded from a national broadband network planning process that was yet to begin.
In a submission to the NBN Senate Select Committee yesterday, Australian Office for Financial Management chief executive officer Neil Hyden said his office "received no information on the likely structure, form" and timing of bonds to be issued to partially fund the network.
"The [Office] has had no contact so far with the implementation study and has received no information," Hyden wrote.
"No provision has been made at this stage for the inclusion of [bonds] in the [Office's] issuance plans."
It caused at least one daily newspaper to speculate that Communications Minister Stephen Conroy had rushed his announcement in April that infrastructure bonds would be used to fund part of the proposed network.
But this was hosed down by sources in the office and the Department of Broadband, Communications and the Digital Economy.
Spokesmen for both declined to comment but iTnews understands the office did not intend to make a submission to yesterday's hearings in Canberra.
The status of the broadband network implementation study - which is yet to begin - meant the office was not consulted on issues of bond issuance and funds and therefore had "nothing to say".
But a request from the Senate Select Committee to make a submission was alleged to have forced its hand, sources said.
And ambiguities in the resulting statement appear to have landed the office and Hyden in hot water.
The issuance of Aussie infrastructure bonds was expected to be an area covered by the study.
But it was doubtful bonds would be among the most immediate considerations for the advisory panel that the Government is piecing together.
Bonds would likely be a longer-term consideration because start-up funding for the NBN was allocated in the last Federal Budget and because the borrowing process would likely be dwarfed by the time needed to establish the NBNCo company structures, subsidiaries and network.
The budget revealed start-up funding allocations of $30 million in the last financial year, $750 million in next year's and $3.67 billion in 2010-11.
Hyden said in the office's submission that infrastructure bonds could "take various forms".
The main differences were whether the bonds were issued with the same terms and conditions as other Government bonds.
Similar conditions enabled infrastructure bonds "to take advantage of the liquidity and low cost of existing bond lines". But custom terms could be the key to winning the appeal of investor groups.
"There is no single model," Hyden said.
In a separate submission, Southern Cross Equities raised concerns that the state of the bond market could cause a blowout in costs.
"The Australian 10-year bond yields have risen 200 basis points in recent times but remain below their long-term average," the submission stated.
"With the significant increase in Government bond issuance of late we believe there is a risk that the cost of debt will increase further, potentially beyond their long-term average.
"This would effectively increase the funding cost for the NBN."
A lead adviser for the implementation study was expected to be appointed by the end of the month. The study is due next February.