When the first NBN Co staffing cost figures began to surface last year, the consensus among industry observers was to pay market rates for the best people. This week, the NBN Co CEO pledged to donate his first year’s pay to charity, but the big costs keep on coming.
In August last year, the managing director of ISP Internode, Simon Hackett, said the $2 million a year salary for NBN Co CEO Mike Quigley was good value for money if the project were to succeed.
The amount paid to Quigley, however, has come into question again this week as he announced he would donate $2 million to Neuroscience Research Australia (NeuRA), which will use the NBN to deliver remote rehabilitation therapy to stroke patients via the Nintendo Wii game console.
BuddeComm director and telecommunications analyst, Paul Budde, was positive of Quigley’s appointment and remuneration, but warned the NBN Co must be done properly and not become a ‘pork barreling bureaucracy’.
When asked by whether the amount paid to Quigley and other NBN Co staff and executives is appropriate, communications minister, Stephen Conroy, said all the employees are working at “well below the market rate”.
The news comes a week after NBN Co announced it would compensate Telstra to the tune of $11 billion for infrastructure sharing.
The NBN is a $43 billion commitment and even if it were scrapped by a change in the federal government at the next election, the money already spent and contractual obligations would run well into the hundreds of millions.
“The labour market is a free market and NBN will have to pay rates and salaries the market demands,” Budde said. “I can’t see how the government can influence that.”
Budde is generally supportive of the amount of money being spent by the NBN at this stage, saying the big acquisitions are not improper as “at some stage you have to move away from policy and towards implementation”.
“The good thing with the NBN is people have questions, but I haven’t come across anyone in the telco industry who says the investments are totally stupid and don’t make sense,” he said. “We all seem to be walking in the same direction.
“There’s no doubt the NBN is an extremely ambitious project and we have no examples anywhere else to learn from. Will we make mistakes and waste money? Yes, but we are trying to be a society where you can’t do anything wrong. The reality is when you do projects like this there will be mistakes.”
Budde is confident the government is doing “all the right things” at this stage and hasn’t had any significant criticism from authorities in other countries.
When asked if the opposition should scrap the NBN Budde said to do this would simply be playing politics.
“The opposition doesn’t have an alternative strategy so to scrap it would be for political reasons only,” he said. “I don’t think Australians have much sympathy for policies like that.”
The opposition has pledged to unveil an alternative national broadband plan before the next election.