An Australian news roundup

Corruption at Telstra

French technology giant Alcatel has admitted that it made a "strategic error" in keeping prices for its internet equipment high, costing Telstra hundred of millions of dollars. Less than a week after a leaked Telstra document claimed it had been overcharged, Alcatel's Australia/New Zealand chief Hilary Mine said the company failed to bring prices down, in line with the global market, for a 1999 contract. Under Telstra's Data Mode of Operation (DMO) project, Alcatel was handed the contract, worth as much as $1 billion, to supply DSL equipment, which turns Telstra copper wires into high-speed data connections. By 2003 Telstra, fed up with Alcatel's prices, named NEC as its new DSL provider, and last year, Ericsson was named as a third supplier....

Last week, an internal Telstra document outlining 15 years of problems with Alcatel was tabled at a Senate hearing. The document was prepared by senior Telstra executives concerned that Alcatel had been handed the whole of a $3.4 billion deal to build a residential fibre and DSL network. Industry sources said Alcatel's pricing was up to 40 per cent higher than its rivals. Telstra's chairman Donald McGauchie last week defended the shortened tender process introduced by chief executive Sol Trujillo, which some insiders have described as secretive and hasty....

Alcatel was recently handed a deal worth an undisclosed sum to provide computer-based "soft switches", despite Telstra's previous management deciding to give that work to rival Lucent Technologies after a long testing process. Telstra is in the process of choosing a new vendor for an upgrade to its long-distance optical networks, and has been discussing the project with Alcatel, according to insiders. Senior networks executive Bill Felix is believed to have raised concerns about Alcatel's capability in the area before he left abruptly last week. "With fixed-line projects, it doesn't matter what the question is - the answer is Alcatel," a source familiar with Telstra's network projects said yesterday....

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Nobel winner urges more tax cuts

When one of the world's most respected economists meets Federal Treasurer Peter Costello tomorrow he says he will advocate more income tax cuts for workers. US-based economist Professor Edward C. Prescott, who won the Nobel Prize for Economics in 2004, said he would put the case for the cuts to Mr Costello. "The US has room for more tax cuts too," Professor Prescott said today, after delivering a speech at the University of New South Wales. "When you move to a savings rather than a tax and transfer system, a pay-as-you-go type system, you reduce government expenditure by those responsibilities," he said. "The gain from moving to that is it doesn't distort the ... time allocated between market and non-market activities and time is the most precious commodity."

Professor Prescott, who is the W.P. Carey Professor at Arizona State University and the senior monetary adviser for the Federal Reserve Bank of Minneapolis, said cutting tax increased productivity in the labour market by providing an incentive to work. "Europe, with its tax and transfer system to finance retirement and health, is throwing away 25 per cent of its output," he said. "The Europeans only work about 70 per cent of the Australians or the Chileans or the New Zealanders or the Japanese. Why? They have high tax rates."

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Unbelievable police bureaucracy

Tasmania Police is set to break the record for project delays, with a digital radio network first put to tender in 1995 unlikely to be delivered before 2008. Moves to replace the litigation-plagued Tasmanian Mobile Radio Network have been hit by delays, forcing police to continue using the old analogue network. Angry officers working on the analogue system say radio dropouts and outdated technology are putting public safety as risk.

The Police Association has warned that the quality on the analogue network is poor, but the service has admitted that a network to replace one dumped in 2004 after officers complained of poor coverage, will not go to tender until later this year, making it unlikely to be delivered next year as promised. "We've been told it will be February 2007, so we'd be pretty cranky if it was 2008," Police Association president Sergeant Randolph Wierenga said. Deputy Commissioner Jack Johnston, who said last year that he expected to go to tender in August 2005, now says specifications will be available some time this year.....

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Another ID card fizzler

The Medicare smartcard launched in Tasmania two years ago has been quietly scrapped, a Senate estimates hearing has been told. More than $4.5 million was spent on developing the card, which featured a microchip with far greater data capacity than the magnetic strips on current Medicare cards. Federal Health Minister Tony Abbott launched the smartcard in Launceston in 2004 as part of the now stalled HealthConnect electronic patient record program. It is understood only 1 per cent of eligible Tasmanians expressed interest in registering for the card.

Labor Party Queensland Senator Claire Moore said news that the program had ended was a surprise. "We were informed by Human Services officials that the Tasmanian trial had ended as of last Thursday, and that the lessons from it would flow into the wider access card project," Ms Moore said. "I'm wondering when they would have got around to telling us if we hadn't asked the question."

Since the smartcard was developed, Medicare Australia has become part of the Human Services mega-department, which is planning its own multiple-agency card. A spokeswoman for Human Services Minister Joe Hockey said no final decision had been made on the card, but the Tasmanian trial was being reassessed in light of Government approval for the access card. "We're trying to work out how to manage the transition," she said. "We don't want people to come in and register for the Medicare smartcard and then have to get a new one when the access card is up and running. "We may be in a position to announce what's happening later in the week."

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Australia to the rescue yet again

East Timor, The Solomons and now a second time in Indonesia. Strange that I can remember no offers of help from abroad for our own cyclone disaster in north Queensland. But our local North Queenslanders helped themselves pretty well anyway

The first of a team of Australian disaster and medical experts will arrive in Indonesia today to begin work in the earthquake-ravaged city of Yogyakarta. More than 5400 people were killed, many thousands more injured and as many as 200,000 left homeless when the 6.3 magnitude quake struck on Saturday. Foreign Minister Alexander Downer, who today described the situation as "incredibly severe", said the Government had committed a large contingent of experts to help. "What we are doing is we have sent a seven-person AusAID team that will be in place in Yogyakarta today to establish a support base for co-ordination, logistics and the medical support presence, and we are sending a health team in there of 27 medical and surgical personnel," he told ABC Radio. "There will be surgeons, anaesthetists, operating staff, disaster medicine specialists and so on."

Australia is one of many nations to dispatch aid for the tens of thousands of earthquake victims as the United Nations issued an urgent call for field hospitals, medical supplies and tents. UN emergency relief co-ordinator Jan Egeland, who helped oversee the tsunami relief in Indonesia's Aceh province, said yesterday the effort should be quicker in reaching quake victims and rebuilding on the country's main Java island. "This time I think it's going to be easier because Java is not as remote as Aceh," he said. "We are now able to help in a matter of hours after an earthquake strikes," Mr Egeland said. "We are better co-ordinated now than ever before." .....

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