Households facing Government imposed copper tax

Almost 80 per cent of New Zealand households will be hit with what is effectively a copper tax as Amy Adams provides a corporate welfare hand-out to Chorus, Labour’s Communications and IT Spokesperson Clare Curran says.

“That is despite Chorus recording one of the highest dividend pay-out to shareholders this year.”

“Amy Adams’ extraordinary intervention in the broadband market this week – by proposing to keep the price of copper broadband at the more expensive level of fibre broadband -- will not increase consumer connections to ultrafast broadband.

“It will sustain Chorus profits and the dividends of its investors, many who live offshore.”

The Government is pretending its roll-out of ultrafast broadband is an overwhelming success, despite 80 per cent of Kiwis not even being able to connect to fibre, she says.

“Figures released yesterday show just 0.73 per cent of households have connected to fibre, with only 22 per cent of households having the capacity to do so.

“The majority of Kiwi households which use copper broadband services will have no choice but to pay more than they should, despite the Commerce Commission recommending their charges be cut by $12 a month.”

Clare Curran says Chorus -- which has the main government contract to roll-out ultrafast broadband fibre -- has no incentive to increase the delivery of fibre because the company also dominates the copper market.

“Amy Adams has handed Chorus an inflated copper price which means the company holds disproportionate power over the whole broadband market.

“The Government must insist Chorus deliver on its existing contractual obligations at the original price set in 2010 and abide by the Commerce Commission’s rulings. Instead it is bowing to pressure to block the regulatory process, subsidising Chorus profits and ripping off Kiwi consumers.

“If Chorus can’t deliver on the original terms of its contract, the Government should consider whether the company is up to the job and consider re-tendering the project,” Clare Curran says.

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