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ACT opposes broadband levy plan

Contributor:
Fuseworks Media
Fuseworks Media

Wellington, March 19 NZPA - The ACT Party is calling on the Government to rescind its proposals for a rural broadband rollout which involve Telecom paying a levy of $50 million a year.

The plan, announced on Wednesday, would see the Government providing $48m towards the $300m cost with the telecommunications industry providing the rest through levies.

Telecom said its earnings would be compromised, and its share price plunged.

ACT leader Rodney Hide said today Telecom would be forced to become the default provider of uneconomic rural services and the plan would be an unjustifiable use of the Government's regulatory power.

"This proposal is extremely concerning. It is inequitable and imposes anti-competitive obligations on Telecom," he said.

"And in doing so, the Government is taking away millions of dollars from everyday Kiwis who have invested in Telecom through their KiwiSaver accounts and the New Zealand superannuation fund."

Mr Hide, who is Minister of Regulatory Reform and is putting a bill through Parliament to ensure any new regulations are based on sound reasoning and necessity, said the proposals undermined the Government's commitments to regulatory reform.

"We urge the cabinet to rescind these proposals and replace them with an approach that is in keeping with the commitments the National-ACT Government has made to New Zealanders," he said.

ACT's agreement with the Government, signed after the last election, commits it to supporting National on confidence votes in Parliament but it is able to disagree on anything else.

ACT's opposition to the proposals won't make the Government change its mind, but it prefers to have its support partners behind its plans.

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