Feeds

Construction industry outlook is bad news for Turnbull's alt.NBN plan

Mal The Builder … can he fix it? Not with Australia's Scoop, Muck and Dizzy on the job

Top three mobile application threats

When Senator Stephen Conroy, Australia's former Communications Minister and the man who drove the early years of the nation's National Broadband Network (NBN) build, recently admitted that the rollout targets he signed off for the network's construction were too ambitious it was taken as further evidence his failings.

Conroy said the construction industry wasn't up to the task of meeting the targets he agreed to, a point of view that has to be appraised as more than a little self serving.

Nobody twisted those companies' arms to enter into those contracts that they later found impossible to deliver on time or at a profit, so there's clearly some truth in Conroy's point of view that construction companies are getting something wrong.

Current Communications Minister Malcolm Turnbull's alternative NBN policy nonetheless promises to deliver a completed fibre to the node (FTTN) network in a year less than required for the previous government's fibre to the premises (FTTP) network. Turnbull has suggested the comparative simplicity of the FTTN network is one reason for the likely faster completion but also stated the Liberal/National coalition would be better managers than its predecessors and therefore avoid the mistakes that translate into delays.

Turnbull's first steps have been to replace much of NBN Co's board and install Ziggy Switkowski as executive chair in part because of his experience delivering “linear infrastructure”.

That experience will doubtless be useful, some interesting data came to light yesterday suggests the construction industry won't do Turnbull any favours.

The data is the Australian Industry Group's (AIG's) October 2013 Construction Outlook Survey (PDF). AIG pops out this research twice a year.

The document reports that the construction industry has some big challenges. “Businesses continue to face widespread difficulties in the sourcing of skilled labour and capital requirements,” it says. “This is being reflected in rising input costs which are exerting further pressure on margins.” Wages and building materials are two of the inputs expected to rise.

Those rising costs are expected despite what the report describes as a “weaker outlook” that will mean “the rate of increase in the total value of engineering and commercial construction work is expected to moderate markedly to 2.0% p.a. in 2013/14 followed by similar subdued growth of 1.0% p.a in 2014/15.”

In other words the industry will have less work to do, but will have to pay more to get it done.

One of the few bright spots in the report is a prediction that “continued strong growth is forecast in transmission & telecommunications in line with the NBN roll-out and related investment.” There's also a caution that “Businesses also expect softer growth in transmission & telecommunications (+13.0% p.a.).”

The AIG is not backward in coming forward: Conroy would have been able to access such forecasts without much effort. The current government prides itself as being close to business, so elaborations on conditions in the construction industry won't be hard to find.

Let's be kind to the AIG and assume that it's not painting the worst possible picture in order to advance its agenda and instead take it at it's word when it suggests the construction industry is struggling to find people, cash and materials.

Malcolm Turnbull may be a better manager than Stephen Conroy and his board might mave more telecoms experience, but if the construction industry really is crook it's hard to see how Turnbull's NBN Co will find it any easier to find and sign up quality builders than Conroy did.

The move from FTTP to FTTN will help, but if the problems Conroy's NBN struck with asbestos prove anything it is that no construction plan survives contact with reality. Turnbull can have all the oversight he wants, but even the best managers can't magically speed time when unexpected problems strike.

In short, The Reg imagines whatever plans Turnbull's freshly-picked NBN Co board lays, they will go awry.

Just how Turnbull explains away the inevitable will be interesting to behold. ®

SANS - Survey on application security programs

More from The Register

next story
Did a date calculation bug just cost hard-up Co-op Bank £110m?
And just when Brit banking org needs £400m to stay afloat
One year on: diplomatic fail as Chinese APT gangs get back to work
Mandiant says past 12 months shows Beijing won't call off its hackers
Whoever you vote for, Google gets in
Report uncovers giant octopus squid of lobbying influence
Lavabit loses contempt of court appeal over protecting Snowden, customers
Judges rule complaints about government power are too little, too late
MtGox chief Karpelès refuses to come to US for g-men's grilling
Bitcoin baron says he needs another lawyer for FinCEN chat
Don't let no-hire pact suit witnesses call Steve Jobs a bullyboy, plead Apple and Google
'Irrelevant' character evidence should be excluded – lawyers
EFF: Feds plan to put 52 MILLION FACES into recognition database
System would identify faces as part of biometrics collection
Putin tells Snowden: Russia conducts no US-style mass surveillance
Gov't is too broke for that, Russian prez says
Ex-Tony Blair adviser is new top boss at UK spy-hive GCHQ
Robert Hannigan to replace Sir Iain Lobban in the autumn
Alphadex fires back at British Gas with overcharging allegation
Brit colo outfit says it paid for 347KVA, has been charged for 1940KVA
prev story

Whitepapers

Top three mobile application threats
Learn about three of the top mobile application security threats facing businesses today and recommendations on how to mitigate the risk.
Combat fraud and increase customer satisfaction
Based on their experience using HP ArcSight Enterprise Security Manager for IT security operations, Finansbank moved to HP ArcSight ESM for fraud management.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
SANS - Survey on application security programs
In this whitepaper learn about the state of application security programs and practices of 488 surveyed respondents, and discover how mature and effective these programs are.