http://www.smh.com.au/federal-politics/fact-checker/will-the-nbn-cost-94-billion... Quote:The claim
Labor says its national broadband network will cost $44.1 billion. The Coalition says it will cost double that, and three times the cost of the scaled-down $29.5 billion version the Coalition is taking to the polls.
Quote:Supporting evidence
The first is that its wholesale earnings per user start at $22 per month and then climb to $62 by 2020-21 when the NBN is finished. Mr Turnbull says that's a dramatic increase of 9 per cent per year above inflation. There are few precedents for such an increase. For a decade now real fixed-line spending per person has been falling. NBN Co is assuming a huge turnaround.
Looks like Monks costings are way out and its going to get worse when the project is complete after all.
Quote:The second assumption is that NBN Co can wire up each fibre connection for an average of $2400 (satellite and wireless connections will cost much more).
Quote:The third assumption is that the NBN will be finished on time. Due in 2021, it has already missed many deadlines. NBN Co itself describes its task as ''challenging''.
Quote:Put together and building on each other, these ''quite moderate and realistic'' assumptions push up the total cost of the project to $94 billion by the delayed completion date of 2025. By then Mr Turnbull says NBN Co will also be losing $5 billion per year.
Quote:Does it stack up?
On earnings per user, NBN Co chief Mike Quigley told Parliament in April that he was making $38 per month, not the $22 quoted by Mr Turnbull (although Mr Turnbull's figure came from Mr Quigley's corporate plan).
Quote:On costs, NBN Co has told the parliamentary committee it is managing to connect each user for $2200 to $2500, close to its assumption of $2400. Mr Turnbull believes that estimate excludes some costs and is dominated by the low cost of the easier connections NBN Co is doing first.
Quote:On the question of delays, Mr Quigley told the committee in April that he stood by his target of finishing the NBN by 2021. Then in July he resigned, declaring his job of laying the foundations for the project ''largely complete''. NBN Co had expected to have 566,000 active users by June 2013. It managed to connect 33,600.
Quote:Finding
Mr Albanese told Lateline this week that Mr Turnbull's $94 billion figure had been ''plucked out of a Coco Pops packet''. ''And indeed, the joint parliamentary committee, of which Malcolm is a member, did consider this and found there was no basis in fact.''
In fact the committee made no such finding.
Quote:Mr Turnbull is on strong ground when he says the final cost of Labor's NBN would be likely to exceed the claimed $44.1 billion. Most major projects go over budget. Australia's Parliament House was to cost $220 million. It eventually cost five times as much, $1.1 billion. The Sydney Opera House cost 14 times the original estimate. But the Snowy Mountains Scheme is said to have been delivered on time and on budget. Labor's NBN is bigger than them all.
Quote:So difficult is it to estimate the cost of such a project that parliamentary budget officer Phil Bowen this week revealed he would not have been able to cost the Coalition's alternative NBN plan had it asked him to.
Monk of course has managed to do both by himself.
Quote:The government says NBN Co's corporate plan has been ''independently verified by KPMG and Greenhill Caliburn'', but the KPMG study wasn't independent (NBN Co paid it for the task) and it took place before construction began. The Greenhill Caliburn review was a paper exercise, which did not examine actual performance.
Quote:Labor's NBN would end up costing $44.1 billion if a lot of things went right. So far several have not. Turnbull's estimate of $94 billion is unverifiable, but possible if Labor won the election and did not alter its NBN plan.
Quote:If Mr Turnbull had merely said that it was highly probable Labor's NBN would end up costing more than the claimed $44.1 billion PolitiFact would have rated the claim ''true'' or ''mostly true'' based on what is known.
Quote:None of the senior telecommunications analysts PolitiFact spoke to wanted to go on record. Each shared one or more of Mr Turnbull's doubts about the NBN Co's assumptions.
Mr Turnbull has gone further and quantified those doubts. His estimate may be on the high side, it may be on the low side.
Quote:PolitiFact finds Turnbull's claim that Labor's NBN would eventually cost $94 billion possible but unverifiable. It rates it "half true".
Monk of course rates it totally untrue.
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