Universal Service?

Telecommunications Policy In Australia and People with Disabilities

By Michael J Bourk

Edited by Tom Worthington.


Review of The Standard Telephone Service

This chapter analyses the attention that people with disabilities began receiving by telecommunications policy makers in the wake of the Scott and DPI (A) v Telstra decision discussed in the previous chapter. A ministerial directive made the telecommunications requirements of people with disabilities a significant aspect of the research undertaken by a group contracted by the Government to investigate the feasibility of upgrading the STS. Arguably, the recognition of people with disabilities as stakeholders in telecommunications policy and their significance as a research priority is an encouraging sign of access and equity.

In April, 1996, a new Coalition Federal Government led by The Honourable John Howard took office in Canberra. Senator Richard Alston became the Minister for Communications and the Arts and began a plan of further deregulation for the telecommunications industry (Alston, ATUG, 96). Addressing the Australian Telecommunications Users Group (ATUG) 1996 convention, Alston announced three policy elements that he described as being the core to a new approach in telecommunications:

(And we will lay the basis for all of these in the coming months) (Alston, ATUG ‘96, 1996, 1).

A key part of Alston's telecommunications reforms involved the partial sale of Telstra which would ``create a new efficient Telstra'' (Alston, ATUG ‘96, 1 ). Alston did not detail what form the new efficient Telstra would take and what would be the concrete benefits. The Minister justified the sale on the basis that Telstra is the only carrier that is not privatised among the top twenty Telcommunications companies, by revenue, in the world (Alston, ATUG ‘96, 1 ). Apart from ignoring social access and equity issues in his definition of a ``top Telco'', Alston arguably uses a spurious correlation between privatisation and revenue. Other socio-economic factors are ignored such as the developed status of the nations included and excluded from the ``top twenty''.

Further, after Alston announced the reasons for the proposed partial sale of Telstra, he accused opponents to the plan of ideological inertia:

The onus in on those who have so far been content to hide behind outdated ideological defences of the public sector to demonstrate that business as usual is going to be anything other than a recipe for declining competitiveness for our major carrier and inferior ourtcomes for all Australians (Alston, ATUG ‘96, 2 ).

Alston's rhetoric ridicules opponents of the sale. Opponents are constructed as cowardly and anti-progressive. However, Alston previously defined progress in technocratic terms of cost-efficiency and competition stimuli. Consequently, it is argued that Alston employed his own ideological bias in the debate.

The proposed sale also enabled the Government to pay off accrued national debt under the Labour Government (Alston, ATUG ‘96, 1996, 1). Another goal was the the removal of regulatory barriers to participation in competition within the Australian telecommunications market by 1 July, 1997. Alston began plans for consulting industry leaders to advise on ways to implement market mechanisms. At ATUG ‘96, Alston announced his intention to convene a Telecommunications Working Forum in the following month and invited all `` interested stakeholders'' (Alston, ATUG ‘96, 1996, 3).

On 16 May, 1996 Alston convened and hosted the Telecommunications Working Forum at the Australian Maritime Museum, Darling Harbour in Sydney. Among the many issues he discussed with business and community members were possible changes to the USO. Among the changes discussed, Alston mentioned the implications of the Scott and DPI (A) vs Telstra decision for the standard telephone service definition:

The Government plans to generally rely on the Disability Discrimination Act 1992, rather than industry specific mechanisms, to meet the needs of people with disabilities. The Scott decision has illustrated that the Disability Discrimination Act can successfully deliver telecommunications access to people with disabilities... Despite a primary reliance on the Disability Discrimination Act, the definition of the ``standard telephone service'' should make provision for teletypewriter users (Alston, Discussion paper, 1996, 21)

Despite the social intent implicit in the telecommunications legislation since Federation (for all Australians), it required the DDA (1992) to enforce the obligations of telecommunications carriers to provide the service for people who are profoundly deaf or have severe speech impairments. Alston's reluctance to expand the standard telephone service to include all people with disabilities potentially requires groups other than TTY users to lodge their own actions under the DDA. One group of people with disabilities that currently have no access to a telecommunications service are people who are deaf and blind. Braille-based text telephones are available overseas but are esimated to cost approximately $ 9, 000 dollars (Noonan, 1996, 8). Arguably, Alston's apparent unwillingness to link the telecommunications legislation specifically to the social needs of all people with disabilities negates the rights of some people in Australia to a standard telecommunications service.

However, Alston's reference to the HREOC inquiry and his intention to include access to TTYs as part of the standard telephone service in telecommunications legislation is a partial victory for people with disabilities. Alston's comments also signify a significant change to policy as the result of the inquiry. Consequently, a significant acknowledgement of the power of the DDA by the government extended the application of the legislation. In addition, the Scott and DPI (A) vs Telstra inquiry was recognised as the catalyst for a renewed focus on the relevance of the DDA. But the legislators were reluctant to extend the social dimensions of Telecommunications policy. As Alston commented, the Government intended to rely on the power of the DDA rather than specifically interfere with telecommunications policy.

In July, 1996, Alston established the Standard Telephone Service Review Group to undertake a demand and feasibility study of upgrading the current standard telephone service. In December, 1996, the group released its report, the Review of the Standard Telephone Service (1996). One member of the ten member group disagreed with the findings of the majority members and released a minor report.

The Review, headed by Jock Given from the Communications Law Centre, is a significant project that emphasised: a) the social nature of telecommunications services; and, b) the necessity of maintaining a dynamic definition of the standard telephone service. Within the first few pages of the RSTS, extracts are given from the Telecom 2000 Report (1975). The Telecom 2000 Report produced by Telecom as indicated in Chapter eight incorporated a visionary social perspective to telecommunications services. Arguably, the RSTS adopted a similar perspective. (RSTS, 1996, 29-34). The report, similarly to Telecom 2000, took a multidisciplinary approach to research:

The task facing this Review was not simply to set some new target for the roll-out of particular communications technologies, but to understand, and respond to, the complex and diverse communications needs of all Australians. Like OECD, the Group took as its starting point the interdependence of technological, economic and social change: ``Technological change is often equated either with certain hardware, of with specific production processes; this is a mistake. Technological change is in its development and application, fundamentally a social process, not an event'' (RSTS, 1996, 34; OECD in RSTS, 1996, 34).

Jock Given and his team attempted to avoid technological determinist pitfalls that may ignore the social contexts in which new technologies are introduced ( See also Jones, 1995, 214- 243). In addition the group approached the project on the basis that the effects of technologies on societies over time are as significant as their initial introduction. Consequently, the group took the perspective that the value of the future impact of new technologies must be factored into the initial establishing costs.

It was on the point of initial costs that disturbed the dissenting member of the group, Professor Henry Ergas. Ergas submitted a minority report. He criticised the majority report as innacurate and impractical (RSTS, 1996, 176-184). The major point of contention was the majority report's recommendation that the universal service arrangements include digital data capacity by 2000 (RSTS, 1996, 176). According to Ergas the demand for digital services is overestimated, the cost is underestimated and the precise nature of the service is ill-defined.

However, Ergas arguably fails to recognise that the report is a social investment projection that attempts to factor increased social awareness leading to increased demand against the inevitable but currently unmeasurable decreasing costs in technology. The costs can not be accurately measured because the figures need to be based on undeveloped technology. The clash between technocratic and rights world-views evident in the HREOC inquiry may be symptomatic of the problems experienced in the course of the RSTS. Ergas' main contentions with the majority report were linked to issues of affordability and measurability.

Not surprisingly, the technocratically minded Alston favoured Ergas' minority report and its recommendations above those of the majority report. In a significant Senate debate during the second reading of the Telecommunications Bill 1997, the ALP's Senator Sue West attacked Alston's report preference. West quoted an article from the Australian that condemned the Ministers rejection of the majority report citing ideological motivations for Alston's choice:

When Senator Alston announced the review he lauded it. He said that it was being undertaken by a very good group of people, they were a very broad representation of a very wide cross-section of the industry and consumers...Nine of the ten members put out a majority report comprising 178 pages of well-argued information and recommendations. There was also a six-page minority report by Professor Ergas. Guess which of these reports the Minister decided to talk about and praise in response? It was the six-page report of Professor Ergas... I wonder why? I suspect that one of the reasons is - and it is pretty obvious now with this legislation that - that the nine-member majority report recommended a cautious upgrade of the telephone service to digital data by the year 2000...Graham Lynch in the Australian of 11 February entitled ``Alston weighs up cost of national ISDN standard again quotes Alan Horsley [Managing Director of ATUG] ``that the work and opinion of a reasonable bunch of people has been set aside by one distant professor. He has an academic dry view with as much relevance as cows jumping over the moon'' (West, HOS, Monday, 17 March, 1997, 1574).

Each of the opposition Senators involved in the debate raised the STS digital upgrade with Alston who responded that he was not willing to commit a CSO to what is currently an undetermined cost (HOS, 18 March, 1997, p1638). The dispute centred upon the last 4% who are rural subscribers and non-commercial telecommunications interests. Most subscribers are metropolitan business and residential subscribers who are commercially viable markets without the need of heavy subsdisation. The digital upgrade debate is significant because apparently ideological persuasions informed the Minister's rejection of the majority report. There is a strong parallel between Ergas' criticism of the majority report and Alston's position in the debate around the same issue. The central point of contention that united Alston and Ergas was the cost of connecting the last 4% to the digital network (HOS, 18 March, 1997, 1638).

In addition to analysing the feasibility of upgrading the standard telephone service the Minister also requested the RSTS, to ``give special attention to the needs of people with disabilities''(Age, July 8, 1996). Significantly, the only recommendations of the majority report that Ergas specifically endorsed related to policy for people with disabilities.

The RSTS recommendations 7, 8, 9 and 10 make specific references to the telecommunications service rights and requirements of people with disabilities:

Recommendation 7 - Customer Equipment for People with Disabilities

The provision of customer equipment for persons with disabilities to meet USO requirements (Part 13 of the Telecommunications Bill 1996) should be dealt with through a self-regulatory approach linked to the operation of the Disability Discrimination Act 1992

Legislation should allow the industry, in consultation with consumers and users, to determine through a code - development process whether to accept liability for providing particular customer equipment to meet USO requirements, without going through the formal processes of the DDA.

In the event that industry does not accept liability for supply of the particular customer equipment through this process, liability should be determined through those processes.

Liabilities at the commencement of the post 1997 legislation should be established in a regulation developed in consultation with the industry and relevant consumers. This regulation should clarify the range of products required as at 1 July 1997 under the Telecommunications Act 1991 [this recommendation occurs in a pre - TCA 1997 context] and Disability Discrimination Act 1992.

Recommendation 8 - Prescribed Goods and Services (National Relay Service)

A service to facilitate inter-personal communication by people with hearing and/ or speech impairments, similar in purpose and overall cost to the National Relay Service, should be incorporated into the universal service arrangements through the making of a regulation establishing it as a service for use in connection with the standard telephone service.

These arrangements should commence on the expiry of the existing Commonwealth funding arrangements at the end of 1997/98. The precise details of the service to be prescribed as part of the universal service obligations should be settled before the expiry of these arrangements in consultation with industry, consumers and users.

Recommendations 9 - Funding Equipment and Services for People with Disabilities

Costs incurred in providing equipment and services to people with disabilities to meet USO obligations determined:

should be compensated through the universal service levy.

The net costs of such customer equipment for people with disabilities, should be counted separately from the geographic costing mechanism and directly added to the cost of the USO.

Recommendation 10 - Payphones Siting and Access:

The main considerations of the RSTS for people with disabilities are; a) the expansion of the USO to fund disability related telecommunications equipment and services, and b) the development of a consultation process between industry and consumers (RSTS, 1996, 121-147). The recommendations are significant but also problematic in the current environment.

Significantly, the RSTS recommends that from 1 July 1998, the NRS is incorporated into the standard telephone service. The STS is funded by the USOs which is distributed among the carriers. The current NRS funding provisions by the Commonwealth expire on 30 June, 1998. After the expiry date, the RSTS recommends that the carriers fund the service. The integration of the NRS into the STS is symbolically powerful. The traditional welfare status of disability services is replaced by a rights based acknowledgement that the USO is a social obligation to provide a telecommunications service for people with disabilities. However, the RSTS also observe that the new competitive regime in which the USO operates makes the proposed system problematic. The new competitive environment involves USOs and not just a single USO:

There will be a national US carrier and regional US carriers who will be allocated a region by the Minister or will gain the region through a tendering process. USOs will be held on a twelve month basis.

If a carrier is subsidising a regional USO greater than the revenue earnt and the costs avoided from that region, the carrier is eligible to claim funds from the universal service levy fund to which all carriers contribute (RSTS, 1996)

Consequently areas that have a low regional USO liability will have little incentive to provide funds for equipment and services for people with disabilities because they will be unable to claim from the universal levy fund. This is because revenue will exceed the carriers aggregated geographical liability. Any expense resulting from disability-related provisions will not be rebated because the aggragated liabilty is less than the revenue gained from the area. For these areas, providing for the requirements of people with disability is a disincentive. The RSTS suggests that the equipment and services should be linked to a separate direcct subsidy fund within the USO (RSTS, 1996, 137 ). However, a direct subsidy is problematic in two ways. First, the funding mechanism is arguably less stable and subject to the whim of authorities. Second, a direct subsidy may reinforce a charity discourse of disability that operates on concession-driven mechanisms. Perhaps a better alternative is to expand the narrow geographical and technical definition of USO to encompass a larger social dimension. In addition, supporting the redefined USO with legislative force may provide the carriers incentive to comply.

In addition, the RSTS recommended that where possible the industry in consultation with community and consumer groups would determine through a code development process the industry's liability through the USO for supplying equipment. For consultation to be effective, it must involve consumer participation in decisions otherwise consumers are cosmetic to the policy process. Furthermore, for consumers to participate in the policy process they must have access to facts and figures on which they can adopt a position and lobby strategically. The AAD Policy Adviser observes that many of the gains in the TCC process for people with disabilities came from the confidence and credibility which comprehensive empirical research provided (pers. comms. AADPA, 1997). Ironically most of the funding for the research came from Telstra - the target organisation for much of the consumers' lobbying.

Disturbingly, in a competitive environment, information is predominantly commercial in confidence. In addtion, there is little incentive for any carrier to fund non-market social research. The AAD Policy Adviser and a CTN Policy Adviser have voiced their concern to the implications of the new competitive environment on the Telstra Consumer Councils and their survival. Both speak of increasing paranoia within Telstra of commercial in confidence information leaked outside the council meetings (pers. comms. CTNPA; AADPA, 1997).

Evidence of Telstra's information security consiousness is found in the corporation's classification process of documents related to TCC. TCC documents have at least four levels. The general public can only access the first, (G) level, while TCC members have varying access to other categories, (R), (C), (S) and CIC (Johnston, 1995, 47). According to the AAD Policy Adviser, since the HREOC inquiry and the disclosures of internal research findings (Telecom Australia, 1991), Telstra have been extremely selective in the information that they have released in the TCCs (pers. comms. AADPA, 1997).

According to a CTN policy adviser, for a consumer consultative- participatory process to have any serious lobbying effect in a forum with the carriers a peak advocate body(ies) must be funded - preferably through the USO to maintain its political independence (pers. comms. CTNPA2, 1997).

Agreement between carriers and consumer groups was preferred to formal action through the DDA which for all parties was perceived as costly, time-consuming and adversarial (RSTS, 1996, 135). However, the RSTS recognised that when other attempts have failed, the appeal to DDA was an appropriate last course of action. The reference to the DDA is arguably a direct result of the Scott and DPI v Telstra outcome. The significance of the inquiry is recorded in the RSTS (1996, 127).

Accessibility to payphones for people with disabilities was also considered by the RSTS. The Telecommunications Act (1991) legislation includes payphones in the USO to be, ``reasonably accessible to all people in Australia on an equitable basis wherever they reside or carry on business and to supply, install and maintain payphones in Australia'' (section 288 (1)). In addition, the DDA also includes a specific obligation for carriers to make payphones accessible to people with disability (section 50). However, due to the expense of modifying and supplying new equipment, payphones were exempted from the DDA for three years. The exemption period expired on 1 March, 1996 ( RSTS, 1996, 149 ).

In consultation with the Disability Consumer Consultative Councils, Telstra adopted a Payphone Access Policy which it initiated in 1994 (RSTS, 1996, 149 ). The policy addresses the telecommunications requirements of people with hearing, sight, and mobility impairments. The latest measures include:

In addition to its recommendations, the RSTS provides a useful overview of :

This chapter has analysed the impact of the Scott and DPI (A) v Telstra on the Federal telecommunications policy research environment. As discussed above people with disabilities were recognised by members of the RSTS committee as legitimate stakeholders in a revised definition of the STS. The RSTS also provided a significant historical overview of telecommunications policy and disability services. In addition, in keeping with the multi-disciplinary approach to the entire research effort, the disability section incorporated issues of access and equity as a social right. However it is argued that, more attention needs to be given to funding of advocate and consumer bodies to ensure the community consultation is an effective policy instrument instead of a token device by industry to minimise critical consumer contributions.

Further Information

Draft of 26 November 1999. Comments and Corrections Welcome
Copyright © Michael J Bourk & Tom Worthington 2000.