Labor wants to fine NBN Co for bad service

The federal opposition wants to create its own NBN service guarantee that would see NBN Co fined every time contractors missed appointments or made installation errors.

Labor leader Bill Shorten and shadow minister for communications Michelle Rowland unveiled the policy on Sunday morning.

“Right now your retail provider is accountable to you and the Telecommunications Industry Ombudsman, yet it’s not really clear who the NBN Co is accountable to when something goes wrong,” Rowland said.

“It’s no wonder that a lack of accountability is one of the biggest complaints about the NBN.”

Rowland said that Labor wanted to “establish an NBN service guarantee” that would bind NBN Co to service standards.

“This will set regulated timeframes and service standards for installations, fixing faults and missed appointments,” she said.

“This guarantee will be enforced through financial penalties if the NBN Co fails to meet these service standards.”

Shorten said that “we've all heard the NBN horror stories, like people taking time off work only for a technician not to show up, or an outage fault that isn't fixed for days leaving a small business in the lurch.”

“Under Labor's NBN service guarantee it will be the NBN Co that pays - not you,” he said.

Penalising NBN Co for missing service level agreements (SLAs) was an idea floated by Telstra earlier this year.

It said it wanted to see NBN Co hit with a “simple, flat rate daily payment for each SLA miss”.

Under Telstra’s plan, the payment would be made to the retail service provider in the form of a rebate. Labor didn’t say who would directly benefit from its own scheme of financial penalties.

Labor’s policy comes at a time when other regulators are examining and introducing a range of similar rules to address the same set of problems.

Most notably, the ACCC is already deep into an inquiry around NBN Co’s wholesale service standards, which covers the issues raised by Labor - who is responsible for rectifying problems, and how long it takes for things to be fixed.

ACCC chairman Rod Sims has already warned NBN Co to expect higher levels of regulation sometime this year, apparently regardless of the outcome of the inquiry.

The telecommunications industry agreed last week to a new set of standards that would limit the amount of time customers are left without functioning internet services in their transition from a legacy connection to the NBN.

Labor said it was particularly concerned with small businesses being left without service, and said it planned to also penalise NBN Co for these incidents.

“We’ll ... establish stronger penalties to safeguard small businesses because we understand the stress caused when your internet and phones don’t work,” Rowland said.

Labor said its plan was to “make the NBN Co more accountable to your retailer, so they can be more accountable to you”.

“This is an essential step towards delivering a better NBN for all Australians,” Rowland said.

Against a backdrop of rising complaints, NBN Co says it is consistently improving in its customer service.

The network builder now publishes a monthly set of numbers [pdf] that show it gets installations right first time in 91 percent of cases, and resolves faults within “timeframes agreed with phone and internet providers” 90 percent of the time.

That could still see NBN Co subjected to considerable fines, should Labor be successful at converting its policy into action.