ACMA Consultation paper –Proposals for reductions in telecommunications reporting requirements

Telecommunications Universal Service Management Agency - Submission

The Telecommunications Universal Service Management Agency (TUSMA) welcomes the opportunity to comment on the proposals provided in the ACMA’s consultation paper.

  1. Background

1.1.TUSMA is a statutory agency of the Australian Government within the Communications portfolio. It was established on 1 July 2012 under the Telecommunications Universal Service Management Agency Act 2012 (TUSMA Act) with a primary role to enter into contracts with, and makes grants to, the telecommunications industry and other providers on behalf of the Australian Government in accordance with the requirements of the TUSMA Act.

1.2.TUSMA’s primary goal is to ensure that all Australians benefit from access to universal service and public interest telecommunications services through effective contract and grant management of:

  • the Universal Service Obligation (USO), which ensures that the Standard Telephone Service (STS) and payphones are reasonably accessible to all people in Australia on an equitable basis, wherever they reside or carry on business;
  • the National Relay Service, which assists people who are deaf, or have a hearing and/or speech impairment, to access a telephone service equivalent to the STS;
  • the Emergency Call Service, which is a service for receiving and handling calls to an emergency service number and transferring such calls to an emergency service organisation;
  • provision of untimed calls in remote areas of Australia under the Extended Zones Agreement; and
  • programs to support the continuity of supply of carriage services during transition to the NBN. This includes migration of voice-only customers and public interest services, such as public alarms and traffic lights, from the existing copper network to the NBN.

1.3.TUSMA currently administers a 20-year agreement (“the Agreement”) with Telstra for provision of the USO STSandpayphone services, and the Triple-Zero Emergency Call Service (ECS).

  1. Proposed reform: Amend the CSG Rules to reduce the current biannual reporting to a requirement for an annual report.

2.1.TUSMA’s primary concern is with the effect of a diminished reporting requirement on Telstra, rather than the effect on other qualifying carriage service providers (QCSPs) on the basis of Telstra’s delivery of the STS under the Agreement.

2.2.As noted in the consultation paper, in relation to the STS, the Customer Service Guarantee (CSG) standards and benchmarksare used as the performance requirements that Telstra must deliver under Agreement. In essence, CSG performance benchmarks are used as proxy performance metrics in the absence of STS-specific performance benchmarks relating to service connection, fault repair and appointment-keeping.

2.3.Similarly, the regulatory performance reporting requirements required under the Telecommunications (Customer Service Guarantee) Record-Keeping Rules 2011 are used by TUSMA as the basis for contractual reporting obligations to allow an assessment of Telstra’s (STS) service delivery under the Agreement.

2.4.TUSMA’s assessment of Telstra’s 2012-13 STS performance can be found in the annual report on our website at .

2.5.The application of the deregulatory initiative at an industry-wide initiative level will have anegative, i.e. reduced,effect onTUSMA’s ability to oversee Telstra’s compliance with the delivery of the STS under the Agreement.Under the Agreement, Telstra’s reporting to TUSMA must be “consistent with Telstra’s regulatory reporting obligations.” Through this linkage, a reduction in the frequency of regulatory reporting will have the flow-on effect of reducing the frequency of Telstra’s contractual reporting, unless TUSMA can negotiate an alternative reporting arrangement with Telstra.

2.6.The reporting from Telstra to TUSMA serves a number of important public interest and contractual benefits that provide:

  • evidence of Telstra’s successful delivery of STS (CSG) performance requirements as a basis for approving payments to Telstraunder the Agreement;
  • consumers and relevant interest groups with confidence that telecommunications service delivery requirements are being met;
  • through public disclosure,an incentivefor Telstra to improve service delivery in areas where its performance is not meeting benchmarks;
  • evidence that value-for-money is being achieved in the expenditure of the USO Levy contributions from industry and government;and
  • an historical record of Telstra’s contract performance as a basis for providing advice to the Minister in relation to the possible removal of USO regulation under ss.8J and 8K of theTelecommunications (Consumer Protection and Service Standards) Act 1999 (TCPSS Act).

2.7.A key aspect of six-monthly reporting is the opportunity it provides for TUSMA to address concerns with Telstra in relation to performance benchmarks that are tracking below required thresholds.

2.8.As an aspect of TUSMA’s policy objectives under its Act, the ability to identify areas of under-performance in telecommunications service delivery in a timely manner,and obtain commitments from Telstra to ensure appropriate attention and resources are being directed in response, is an important measure of control under the Agreement.

2.9.In addition to its annual reporting requirements to Parliament (as an Australian Government entity), TUSMA is also required to report annually on contractor performance under its Act as a contract management agency. In accordance with its Act, TUSMA is required to monitor contractor performance and the shift to annual reporting removes this ability to manage any under-performance during the course of the financial year over which Telstra delivers telecommunications services. The proposed annual reporting frequency would provide TUSMA with only a punitive response through the imposition of remedies on Telstra under the Agreement in the event that a performance benchmark was not met.

2.10.TUSMA believes that the maximum benefits stated under 2.6and 2.7are achieved by the frequency of Telstra’s reporting being maintained at at-least six-monthly intervals.

2.11.The consultation paper does not specify the nature orquantum of costs of the regulatory burden imposed on QCSPs generally, or on Telstra particularly. Accordingly, it is not possible to undertake a comparative assessment of(regulatory) costs relative to the (public interest) benefits of reporting at either an industry-wide level, or in relation to Telstra.

2.12.Consistent with 2.1 and subject to 2.11, if a proper analysis of the costs and benefits of CSG reporting determines no overall loss of consumer benefit in the event that regulatory reporting is reduced, TUSMA has no objection to the extension of CSG reporting for non-Telstra QCSPs to an annual frequency.

2.13.TUSMA notes that the Department of Communication’s recent consultation paper on consumer telecommunications deregulation suggests potential changes to the CSG regime. Until the outcome of that process is finalised, TUSMA believes it would be prudent to maintain the existing reporting framework to allow it to ensure that contractual arrangements were in place to measure STS USO performance. Accordingly, TUSMA does not support the reduction of CSG reporting to an annual requirement at this point in time.

  1. Proposed reform: Amend the Payphones Rules to reduce the current biannual reporting to a requirement for an annual report.

3.1.As noted in the consultation paper, in relation to payphones, the Telecommunications Universal Service Obligation (Payphone Performance Benchmarks) Instrument (No. 1) 2011is used as the basis for performance requirements and reporting that Telstra must deliver under the Agreement. Similarly, the regulatory performance reporting requirements required under the Telecommunications (Payphones Performance Benchmarks) Record-Keeping Rules 2012 are used by TUSMA as the basis for contractual reporting obligations to allow an assessment of Telstra’s service delivery under the Agreement.

3.2.TUSMA notes that Telstra’s delivery of payphone services has been satisfactory.

3.3.However, the rationale and benefits of six-monthly performance reporting for payphones is the same as those stated in relation to Telstra’s delivery of the STS at 2.6, 2.8 and 2.9. TUSMA believes that at least six-monthly reporting imposes on Telstra a discipline to provide payphone services at required levels, and provides sufficient disclosure to support public and industry confidence in the value of payments to Telstra in payphone service provision under the Agreement.

3.4.TUSMA does not support the reduction of payphone reporting to an annual requirement.

  1. Proposed reform: Repeal sections 61 and 62 of the ECS Determination.

4.1.TUSMA oversees the contractual delivery of the Triple-Zero ECS under the Agreement. While the proposed reform does not directly impact TUSMA’s oversight, TUSMA is interested in any future opportunity to comment on ACMA proposals in relation to ECS reform.

The contact officer for this issue is Matthew Powell, A/g Director, Public Interest Contracts & Performance. He can be contacted on (03) 9097 8317 or .