Fears have emerged that the peak funding of the National Broadband Network (NBN) in Australia could balloon beyond A$44 billion, as construction companies urged the government to pare back the reach of its ambitious fibre footprint so it can meet its budget.
The warnings follow a tumultuous week inside NBN headquarters in which a number of senior staff have resigned after a multi-billion-dollar construction contract was placed on indefinite hold.
Construction executives claim that NBN Co could significantly lower the costs of its construction tender if it could reduce the target of laying fibre to 93 per cent of homes and businesses.
An executive of a firm bidding for the work has claimed that costs could be significantly lowered if existing fibre networks – such as Telstra’s and Optus’s cable networks for pay-TV and broadband – could be used in the NBN roll-out, or otherwise allowed to compete with the NBN.
“NBN Co could lower its costs if it just dispensed with the Government’s stubborn ideology to roll fibre to 93 per cent of homes,” the executive said. “They have gone to the extreme but they still claw it back, but there will have to be some eating of a lot of humble pie if they do.”