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Secret papers reveal Telstra faults

By Belinda Tasker

SECRET documents showing Telstra's phone faults skyrocketing to a six-year high have destroyed the government's case for fully privatising the telecommunications giant, Labor said today.

The leaked internal Telstra documents, made public by Labor in parliament today, warn that faults on the telco's fixed line phone network have surged in metropolitan and regional areas.

The documents, dated December 2003, blame the rise on general network deterioration because of a lack of rehabilitation work.

They warn things will only get worse unless enough money is thrown at fixing the problems.

Telstra tonight said it had set aside $20 million to fix faults in its network, which it said had deteriorated because of bad weather.

Opposition communications spokesman Lindsay Tanner said the information in the documents was in stark contrast to claims by the federal government and Telstra that services were improving.

The government has argued that it will only sell its remaining 51.05 per cent stake in Telstra if services in rural and regional areas improved.

"The government's case for privatising Telstra is now in complete tatters," Mr Tanner told reporters.

"Their argument that regional services are up to scratch has just been blown to bits by Telstra itself."

Earlier in parliament, Mr Tanner asked Prime Minister John Howard if he stood by comments he made last August that telecommunications services in regional Australia were "more or less up to scratch".

Mr Howard replied he did but refused to comment on the confidential documents because he had not seen them.

"But I stand by the statement I made (on the adequacy of services) ... I stand by it completely," he said.

Mr Tanner said the confidential documents also raised doubts about evidence given to a Senate committee last month by Telstra's head of service advantage, Anthony Rix.

Mr Rix blamed recent rises in faults on bad weather and described as a myth claims that faults had risen because of network neglect and declining staff numbers.

He said the leaked internal documents showed that Telstra's processes were working as it identified an area where it needs to spend more money to maintain services for customers.

"Any suggestion that faults have risen due to network neglect or declining staff numbers is not supported by the facts," he said.

"We expect Telstra's expenditure on the network for the next financial year to exceed the amount spent this year."

But Mr Tanner accused Telstra of misleading parliament and the government of misleading the public.

"One of the issues that the government has to answer is did they know, were they told by Telstra, that this terrible state of affairs with respect to its network actually prevailed," he said.

Communications Minister Daryl Williams also refused to comment on the documents but said the government recognised the importance of reducing faults.

"Faults will occur, and they may sometimes receive adverse media coverage, but it's important to remember that Telstra operates over 10 million fixed services and the vast majority of these operate reliably," he told parliament.

Mr Williams said Telstra was also required to report on recurrent faults and take action to prevent them.

If it doesn't, it faces fines of up to $10 million.

Figures showed that in the September quarter of 2003, Telstra had cleared 91 per cent of faults in urban areas within its customer service guarantee timeframes, he said.

Ninety-five per cent were fixed in rural areas and 94 per cent in remote areas.