Correspondents in Canberra | December 04, 2008
THE federal government and opposition are heading for another showdown in the Senate, this time over broadband funding.
Labor is furious after the coalition won an amendment in the upper house to prevent the government using money from the Communications Fund to build its national broadband network (NBN).
The government wants to transfer the money in the $2.4 billion fund, set up to future-proof telecommunications in rural and regional areas, to its proposed Building Australia Fund (BAF).
The government intends to then use the BAF to pay for its $4.7 billion subsidy to the company that wins the contract to build the NBN.
The opposition believes such a move would disadvantage rural and regional Australia.
The opposition amendment, supported by crossbench senators Nick Xenophon and Steve Fielding, would force the government to seek alternative sources of funding for the NBN.
The amendment was attached to the bill which seeks to set up the BAF, and the government's multi-billion dollar Education Investment Fund and Health and Hospitals Fund.
Government frontbencher Nick Sherry said the amendment was "irresponsible" and would have very severe ramifications for the NBN.
"There's no way that the government would consider this amendment," he said.
The government is almost certain to block the change in the lower house, meaning another Senate showdown looms.
The Senate passed a raft of other opposition and Greens amendments to the bill aimed at making the funds more accountable and transparent.
One amendment requires all funding decisions go before a committee. Another prevents the government seeking up-front fees from companies applying for work under the funds.
The amended Nation-building Funds Bill 2008 and related bills were expected to pass the Senate later on Thursday.
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AAP