Picture: Don't sell TelstraThe Sale of Telstra


Telstra workers attacked by Minister and Telstra for telling the truth on service levels - ABC 27/3/98, Takver March 30
Howard heralds an election of Greed! - Takver March 16
Telstra silences staff on customer service problems ABC 27/3/98
Rural Australia Erupts! TOA Bulletin 22-03-98
The Sale of Telstra - The Signal 20 March 1998 Issue No.193
More on Telstra Sale - ABC March 15
Warning on Telstra Shutdowns - ABC March 16
Proceeds from Sale of Telstra - TOA BULLETIN T98-10 16-03-98
Past History of Telstra Sale - Leftlink March 19
Who owns Australia's Telecommunications now - Leftlink March 19
Legalised Theft - Anarchist Media Institute 27/2/98


Telstra workers attacked by Minister and Telstra for telling the truth on service levels

The Queensland branch of the communications union is distributing 100,000 postcards to its technicians to pass on to any Telstra customers who complain about service delays. The cards, which object to any further sale and highlight a decline in rural services, are addressed to Telstra boss Frank Blount and federal politicians.

Communications Minister, Richard Alston, and Telstra management have attacked the union saying the claims are misleading and defamatory, and the union could face legal action. The Government is worried because many Australians, particularly those living in country and regional areas, are against the further sale of Telstra.

Alston said "They're not about quality of service they're not about ensuring that Australians have better phone service - they're about blaming the company, blaming everyone else and mounting a scare campaign."

The reality is that Alston and his cronies like millionaire Senator Parer in the Liberal Party are only interested in greedily feathering their own interests and the interests of their friends. The vast majority of Australians are not going to buy shares in Telstra, not when 30% of all Australians live in or bordering on poverty.

Workers in Telstra understand why quality of service, especially for country folk, has declined. There has been constant cost cutting and redundancies over the last couple of years. The result - more pressure on the existing staff, and loss of service quality.

Telstra's Industrial Relations is headed by Rob Cartwright, head huntered from the anti-union mining company Conzinc Riotinto Australia (CRA), and described as one of "Reith's Rambos" by the Australian Financial Review. Confrontation, individual contracts, and union busting are on the agenda in Telstra. The current enterprise agreement has been stalled by management for the last eight months, despite record 3 billion dollar profits and landmark productivity gains by staff.

Queensland Union secretary Ian Mclean says the campaign highlights service problems caused by the first Telstra sale. "We started this before the announcement to float the other two-thirds. Floating the other two-thirds will just aggravate the situation because again, Telstra management will have their eye on the share market and not on the service to customers."

If Telstra is fully privatised, rural and regional customers will become second rate customers, despite any legislative guarantees. Also, Telstra's commitment to supporting a private Telecommunications manufacturing industry may very well become history, thus causing loss of local manufacturing jobs and greater import of technology which will impact on the trade deficit.
(Source: ABC March 27, Takver March 30)


Howard heralds an election of Greed!

At the Liberal Party National Convention in Brisbane over the weekend our Prime Minister, Johnny Howard, has decided to privatise the 'Commonwealth of Australia' and declared a major redistribution of wealth - from the poor to the rich.

His agenda includes:

Telstra - Johnny Howard's election rabbit.

The full privatisation of Telstra redistributes a 'common wealth' asset into the hands of those who are reasonably wealthy and can afford to buy shares instead of the necessities of life. This is not an option for many folk in Australia - 30 percent of whom are living in poverty. These people are effectively being robbed of a 'common wealth' asset.

The government argues that 92% of employees accepted a special share offer when the first third of Telstra was sold. This is true. Telstra workers know they're being screwed. Telstra management have been stalling for over six months on a new enterprise agreement. The share offer to staff was made as a no interest loan with a no risk guarantee. Loan to be paid off from progressive dividends. So, off course the vast majority of Telstra's workers accepted shares on these terms. Why doesn't Johnny Howard offer the same deal to every Australian? That would make the shareholding even more democratic.

One of the ironies of the sale of Telstra is the part that renegade Labor Senator Mal Colston and Tasmanian Independant Senator Brian Harradine played in passing the initial sale. A deal was done with them that Telstra would create some jobs in the states they represented. This was done - for a while. But Telstra is now motivated by the bottom line - reducing costs and maximising profits for the shareholders. Telstra has recently decided to centralise Network Operations maintenance in Melbourne - thus closing many decentralised Network Operations centers.

More and more we will see the closure of other 'non-profitable' services to rural and remote Australia. The politicians can legislate all they like about guaranteeing telephony services to all Australians, the fact is the profit motive within Telstra will dictate two classes of customer - those in rural and remote areas who will get a second rate basic service, and those in capital cities, especially the Sydney-Melbourne market who will get the competitive choice in carriers and services.
(Source: Takver - March 16)


Telstra silences staff on customer service problems

Telstra claims the Communications, Electrical and Plumbing Union is spreading false information, suggesting that staff cuts have led to poorer service and lower standards in rural areas. It has threatened to sue the union and sack staff if they spread misleading allegations to damage Telstra.

Shadow Communications Minister Chris Schacht says he is appalled at Telstra's action, and he has called on the Government to order Telstra to cease its intimidatory and threatening behaviour. Senator Schacht says Labor warned that the privatisation of Telstra would affect the standard of its services.

From a bulletin by Colin Cooper, CEPU President: In what the CEPU believes to be an "over the top" reaction, Telstra has obviously decided it is easier to threaten to gag the union and its members, than it is to solve the problems customers are complaining about. The CEPU has frequently had to remind Telstra that this is 1998 not 1898, and all citizens have the right of freedom of speech. ...If it is Telstra's intention to seek to suppress information which is in the public domain by threats of legal action, the union would utterly condemn such a blatant attack on freedom of speech. ...It is about time Telstra concentrated on fixing the problem, not trying to "fix" the employees who are trying to provide a decent service to their customers.
(Source: ABC March 27, TOA BULLETIN T98-11 March 23)


News Comment - The Telstra Sale - 23/3/98


"Honest" John must be thinking about "necking" himself. The outcry from the bush after he said that he would sell all of Telstra was very loud, very effective and ongoing. Why don't they trust him? Honest John said he will protect them. It's easy, all he has to do is pass a LAW! Well if it is that easy, what about the SAME LAW for Banks? A LAW that the Commonwealth Bank be given the Community Service Obligation (CSO) to open branches in the bush and that they be funded by a levy on all banks?


"Honest" John compared himself with that other giant, "Pig Iron Bob" Menzies. The unions opposed the sale of iron ore to Japan fearing that it would come back and harm us. We fear the sale. Why didn't "Honest" John announce the other great news. Telstra is ahead in its plan to sack 25,000 full time employees. They have reached 18,000 already and are a year ahead of schedule! And there is more good news - more staff will be added to the sackings. Who said this? It was left to Frank Blount, speaking to bankers in New York this week. (see AFR Sat). John Howard could not find time to announce this wonderful news. He was opening the usual small business somewhere in Australia and proudly announcing that this will create some 20 part time low paid local jobs. He always said he loved the battlers. Is that why he wants more of them!


No not steak knives. Telstra is reducing its capital expenditure. Non-Telstra staff will also be sacked as companies lose their contracts with Telstra. Will this affect the long term future of Telstra? Of course it will, but who cares? The shares will be sold. The managers will be gone - off to "save" another company. Frank Blount has been criticized by the money market for embarking on a massive plan to cable Australia. It was a defensive but strategic move. This investment will make a return, but not this year. It was the right decision. It is still the right decision. There will be many Australians who will want the cable, either for TV or other services. The roll-out was stopped so that the prospectus looked better. The roll-out should be completed, underground.

The fundamental problem is that the markets tend to treat companies as commodities, not investments. Capital expenditure is a waste to the short term players - they want the money for immediate returns. That is why jobs are always shed and services cut. Service reduction doesn't hit the bottom line for some years. Get in, take a profit and get out!


As a result of staff cuts, service cuts and reduced capital expenditure, Telstra is suffering from an excess of funds. It has about $1.5 billion to spend, according to the media. The markets are urging a special dividend to shareholders or a share buyback (to increase share prices). No one is suggesting a strategic investment. The AFR says that Frank prefers a buyback.

Source: Excerpts from TOA BULLETIN T98-11 22-03-98
CEPU The Communications Union - TOA Branch
TOA HOME PAGE http://www.magna.com.au/~dwyer



In the last Federal Election John Howard sought by trickery to have his 1/3 rd sale of Telstra endorsed by the electorate. He did this by promising to use some of the funds for environmental improvement.

He had to use this trickery because all the polls showed that the general public were opposed to the privatisation of Telstra.

As a result of the election in which the Senate had a majority opposition to the sale of Telstra, "Honest" John had to then resort to buying off of the odd Labor rat here and there to get the 1/3rd sale through the Senate.

Now Howard is proposing to sell the rest of Telstra after the next election but, to try and put the Legislation through the Senate in the next few weeks to prepare for its sale. The latest polls still show overwhelming opposition to the sale of Telstra by the general public.

Once Telstra is fully privatisated there will be no way that any Government will be able to stop it making commercial decisions to scrap any remaining universal service obligations, to introduce timed local calls, to fully commercialise charges to the disadvantage of residential and rural customers, and to buy "off shore", thus destroying an Australian based manufacturing industry.

Howard also thinks that as a result of the number of people who bought Telstra shares he will be able to convince the public because of the availability of more shares. Isn't it obvious that another 2/3rd sale is likely to undermine the value of Telstra's share price quite significantly.?

Isn't it also obvious that what some of the public might gain in shareholding they loose in chopping off the huge revenue from Telstra that goes to Government regularly to reduce taxation and pay for Government services.

This will be a good election issue and hopefully will be one of many issues that will bury a pathetic Government.

(Source: The Signal 20 March 1998 Issue No.193)


More on Telstra Sale.

Ian McLean, from the Communications Union, says people should think carefully about the sell-off.

"While the stock brokers in the North Shore in Sydney might do well out of the privitisation, there are people who are missing out, the people who don't have shares, and that's about 14 million Australians and who depend on the service, particularly in the country, and that level of service is gradually being reduced in the name of increasing profit," he said.

Mr McLean says people must show their concern at the ballot box.

"We'll be campaigning in those areas worst affected by the commercialisation of essential services and that is the country in Queensland. The provincial areas and the country areas have fared very badly out of all this and the removal of government service in all of this hasn't just affected the service directly but it's affected employment and the economies of those communities."
(Source: ABC March 15)


Warning on Telstra Shutdowns.

Australians are being warned the Telstra communications network is set to suffer shutdowns along the lines of the power cuts in Queensland and Auckland. The CEPU says the Commonwealth wants to sell its remaining stake in Telstra before it starts to collapse through neglect and cutbacks.

Union National Secretary Peter Tighe says a public campaign will tell consumers not to blame workers for delays and poor service. "The Government blames us about inflexibility, organised labor and union labor that creates those problems when in fact it is, in fact, a manifestation of their policies in relation to deregulating - labor shedding with an expectation to privatise and sell-off public assets."
(Source: ABC March 16)



Some $1,000 million from the sale of Telstra has been given to a new mob called the Heritage Foundation. Parliament has debated the allocation of this "slush" fund. The bulk of the funds went to Liberal/National electorates. The debate is over this and whether it is fair, or just an election year tactic. But "Honest" John Howard found a new way to spend the proceeds. He is simply giving every politician $200,000 to spend before the election, another $30 million from the Telstra sale. For that, John should be able to get every rock in every park painted white!

SALE OF TELSTRA. Yesterday, "Honest" John Howard announced what we all believed he would do - he will sell the rest of Telstra. So far he has sold 4.3 billion shares. So another 8.6 billion shares will be sold. Unless he can sell it to a foreign company, it is likely to dramatically reduce the share price. In November this year everyone will have to pay the second installment of $1.35, reducing the amount of capital available for the sale. It is difficult to see why the shares would go up, but then again the stock market is run on hype, not much reality.

TOA HOME PAGE http://www.magna.com.au/~dwyer
(Source: TOA BULLETIN T98-10 16-03-98)


Past History of Telstra Sale

Some excerpts from earlier Fed Records 1997
Sources and page references from the Melbourne AGE

6/5/97 Australian Conservation Foundation accuses federal government of not only failing to reduce greenhouse gases, and bad policies on woodchipping, but also of taking away the usual environmental grant to make up for the promised $1 billion windfall from selling Telstra. Victorian-based telecommunications equipment industry to shrink drastically as deregulation allows Telstra and rivals to switch to cheap suppliers offshore.

Sept 97. Privatisation. Selling Telstra costs the taxpayer multi-millions to promote, with unnecessarily expensive TV, press and multiple personal letters to the public, to mimic Thatchers 'popular capitalism' that never eventuated in fact. $10-$12 billion is to be raised and government hopes small investors will take up to $5 billion. Telstra's one-third sale will only fund land improvements for five years, but problems would continue for 30-50 years, says executive director of the National Farmers Federation.

18/11. A1. Telstra investors reaped gains of over one third on their investments in Telstra's first day of trading. Telstra valued at more than $50 billion, and paper profits for private and institutional investors were $2.5 billion with another $500 million for the foreign investors. Telstra sold for so far beyond its market value that the first buyers of shares are making $2 billion profit - enough to... and how much of whatever the government does get is going to the environment?

19/11 A16. One third of TELSTRA sold for $14.3 billion and almost immediately stock market valued it at more than $17 billion. Prime Minister boasted in Parliament that 2 million Australians now owned 81% of Telstra shares - but once all Australians owned 100%

21/11.A18 Costello has confirmed that the sale funds will go into debt retirement, not environment.

21/11. A19. Davidson reports that the float cost $175 million in brokerage and fees, according to Chanticleer in the Australian Financial Review. Davidson criticises the speculative frenzy and prophesies no good will come of it. Foreign institutions were awarded 19% of the Telstra float, so that local institutions like AMP got as little as 20% of the shares they had requested. Foreigners selling their shares then made $420 million overnight. The result is a $420 million increase in Australia's foreign debt, which is three times the amount claimed to have been lost by the VEDC which is still recited as the proof that the Cain-Kirner government sent Victoria broke. This gift to Wall St institutions could have resolved the nursing home crisis. The eventual reduction in government borrowings of $14 billion has been offset by a $14 billion increase n private borrowings. Davidson reports that as a result of parallel rolling out of cable and other competitive stupidities, Telstra charges have shifted from world average in 1990 to 40% above in 1997.

28/11. A16. the need for Telstra to put profits before public service. Lewis Luxton's letter on reduced maintenance in the country.

(Source: Leftlink Mailing List March 19)


Who owns Australia's Telecommunications now

Information from the Ausbuy Connection, Jan-March 1998 and the Ausbuy Guide for telecommunications, just out published by the Australian Owned Companies Association, ausbuy@magna.com.au http://www.ausbuy.com.au

(Important Disclaimer: Friends of Ausbuy and AOCA are voluntary organisations, without the resources to verify the information they publish, but if a mistake occurs, they publish a correction as soon as possible. They disclaim all and any liability and responsibility to any person in respect of anything and of the consequences of anything done or omitted to be done by any person in reliance, whether wholly or partially upon the whole or any parts of their publication.)

A particular problem is that often firms that were Australian-owned when the publication was prepared have become foreign-owned by the time of publication or soon after. Having said this, what AUSBUY say is worth listening to and verifying.

The following lists show Australian owned companies, and companies which are foreign owned and/or controlled.

CARRIERS Australian - Telstra Corp, Telstra Multimedia Foreign - Optus Networks, Optus Mobile, Optus Vision, Vodafone, AAPT, Primus Axicorp, Horizon, United Energy, Global One, WorldXChange, Corptel, BT Australia, Digicall

INTERNET SERVICE PROVIDERS - about 500 ISPs include: - Australian: - Telstra Big Pond, Apana, OzEmail, One.Tel, TMX, Magna Data, Giganet, Geko Foreign: - Compuserve Pacific, IBM Global Network, Hutchison

VALUE-ADDED SERVICES Australian - Telstra Multimedia, Telstra, Newsnet, Duplex Communications, Tricom Group Foreign - Optus, IBM Info. services, GE Info Services, Link+Motorola + USA, Sita, Axicorp, Hutchison, Vodafone, AAPT

SERVICE PROVIDERS - at least 500 companies include: Australian: - Prime Communications, Equal Access Comm. Newsnet, Flexifax, Call Australia, Bell Horizon, One-Tel, Q-Net Austral, CorpTel Foreign: Singcom, Sprint, Pacstar, Primus Axicorp, BT Australasia, Saturn Global Network, MCI International, IBM Telesavers + AT&T

MOBILE TELEPHONES Australian: Telstra, Voca Communications Foreign: Optus, Nokia, Fujitsu, Motorola, Philips, Ericsson, Uniden, Panasonic, Mitsubishi Electric

FACSIMILES Australian: Telstra, Voca Communications Foreign: Samsung, Lanier+Pitney Bowes, Panasonic + Ricoh + Sharp + Okifax + Sanyo + Xerox + NEC + Canon + Brother + Konica + Hitachi

ANSWERING MACHINES Australian: Telstra, Voca Communications Foreign: Panasonic + Sanyo + Shinosu, Phonemate, Audio Line


OTHER EQUIPMENT Australian includes: Datacraft, JNA Telecommunications, Erg Telecommunications, Digital Equipment Services, Interconnections, SCI Tec Comm. systems, Stanilite Pacific, Voca Communications, Mitec, Jtec

MODEMS Australian: Charter Pacific Comm., Microfax, Netcomm, Maestro, Datacraft, Ellcon, Spirit, Avteck Data Comm, Jtec, Banksia Technology Foreign: US Robotics, Dynalink

FREE TO AIR TV Australian: ABC, SBS, Nine Network, Seven Network Foreign: Ten Network

Information is also on the Ausbuy Guide for Telephone Handsets, Pagers, PABX systems.

GENERAL: Foreign-owned telecommunications providers already have about 30% of the Australian market. (which may all now be lost to us in the future - and what else can future governments sell to get out of the future troubles the sale will bring to Australia?) In 1997 Telstra's total revenue was $16 billion and profit after tax was $1.6 billion - profit which went to benefit Australia, except for the about 11% of Telstra which is already foreign owned. About 30% of all Australian phone-calls are already made thru foreign owned companies. In 1997/98 year Australia will spend about $24 billion more than was earned, 90% of which is interest and dividends paid on foreign investment. The Kangaroo symbol for Australian-made does not mean that the company which made the product does not send its profits overseas to its foreign owners.

Our foreign debt has increased 720% since 1982 to $321 billion, a high proportion being interest and dividend paid on foreign investment. As Telstra shares are bought up into overseas ownership, this debt will grow further.

(Source: Leftlink Mailing List March 19)


News Comment (27/2/98)


I find it difficult to understand how the media could describe the partial privatisation of Telstra and last weeks record profit as a victory for Australia's "mums and dads".

The partial privatisation of Telstra and the privatisation of many other State and Federal government assets highlights the point that public assets do not belong to the public, but belong to the government of the day. It's strange that in a society where private property rights are sacrosanct, so little regard is given to the property rights of the public.

If public assets belonged to the people the government would not be able to sell them without a referendum. Even if the government has the right to dispose of public assets, it does not have the right to sell them to the highest bidder. If public assets belong to the people and the government of the day decides to privatise them "on our behalf", we should each receive an equal parcel of shares, which we could either keep or sell on the open market.

The problem with the partial privatisation of Telstra, is that those sixteen million Australians who did not have the money or chose not to purchase Telstra shares have now been cheated out of their heritage by the Federal government. Privatisation, a policy pursued with zeal both by the Liberal/National and Labor Parties is a massive public swindle. Reviewing this dismal situation it's interesting to note that the Australian Constitution has not protected the property rights of the public and that this Nation's Courts have consistently failed to protect the publics' property rights. It's disheartening to note that the Federal Treasurer Peter Costello intends to legitimise the Federal governments theft of privatising the rest of Telstra after the next Federal election.

Source: Anarchist Media Institute, Melbourne, Australia
Excerpt from Anarchist Age Weekly Review Number 288, 23rd February to 1st March, 1998

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