Editorial:
Privatisation of Telstra

In the next few months the Federal Government will present to Parliament 
a Bill for either the total or 50 percent privatisation of Telstra. What 
has to be recognised is that preparations for Telstra's privatisation have 
been under way since the appointment of Frank Blount as Chief Executive 
Officer in 1991 by the then Labor Government.

It takes some time to create the best conditions for a big company like 
Telstra to be taken over by private enterprise. Private companies want all 
the dirty work, like sacking thousands of staff, to be done for them in 
advance. They want the latest technology to be acquired at the public's 
expense and then, when all this has been done, the plums can be picked by 
private companies. Another hurdle is the opposition of the Australian 
people who, in their majority, remain opposed to the sell-off of their 
collective property.

The appointment of "Ziggy" Switkowski as Chief Executive Officer to replace 
Frank Blount from the American private telecommunications giant, AT&T, will 
not alter the direction of events. Switkowski will continue the preparation 
of Telstra for take-over and its eventual privatisation.

Switkowski is listed among the clique of top company executives in 
Australia who are committed to private enterprise and, when on the Boards 
of a publicly-owned companies, do all they can to push the privatisation 
cause.

There is nothing in the extensive media coverage of his appointment about 
the community and social obligations of Telstra, nor any commitment to the 
60,000 Telstra employees. These are mere incidental considerations of the 
top business executives.

The coverage is all about Switkowski's and Telstra's connections with 
Foxtel (Rupert Murdoch), the fact that he was until quite recently a 
leading player in the Optus network and that he learnt his executive skills 
while in Optus. The media writes up the number of Telstra staff that have 
been sacked and how the profit per worker has gone up since Blount became 
CEO.

Switkowski was trained as a nuclear scientist but rather than continue in 
this field, chose to join the rat-race of corporate profiteers and huge 
executive salaries.

What does it mean for Telstra employees? He has already made it clear that 
he will continue the "cost-cutting" of his predecessor. "Cost-cutting" is 
merely a euphemism for reducing the numbers employed.

The Financial Review (17/2/99) records that in 1998 Telstra's labour 
costs dropped a massive 7.7 per cent and that since Blount's appointment 
the number of Telstra employees fell by 20,000 despite a huge increase in 
the expansion of Telstra's business.

The FR also says that the revenue per employee increased by more 
than $100,000 annually. This figure illustrates the increase in the rate of 
exploitation of the labour of Telstra's workers who have gained little in 
this period as a result of the "wage restraint" policies of the Federal 
Government.

The new CEO has indicated that he will continue with the "cost-cutting" 
program.

Switkowski is also a close friend of Senator Richard Alston the Minister 
for Communications which the FR quaintly says "may not be a bad 
thing". He is also reported to be "well-connected to the Murdoch and Packer 
families and understands how they operate."

The picture emerges of a cosy relationship between all the major 
corporations in the arena of communications which is, today, one of the 
most important and fastest-growing industries for profit-making and control 
over society.

It is vitally important that the attempt of the Federal Government to 
completely privatise Telstra be stopped. This would be an important step in 
restoring public ownership of telecommunications. It will be an uphill 
battle but it can be done, given the line-up in the Senate. Much will 
depend on whether the Australian public makes its voice heard from now 
until the Government's privatisation legislation is thrown out.

It is incongruous to say the least that the (majority) publicly-owned 
Telstra has a Board of Directors which is wedded to the corporate sector 
and is in favour of privatisation. We want a Board that is committed to the 
maintenance of Telstra as a publicly-owned corporation and is committed as 
its first priority, to social and community needs rather than the profit 
needs of shareholders.