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Australia's Democrats stand firm against Telstra sell-off

SYDNEY: Australia's Democrats party said on Sunday it remained opposed to any further privatisation of telecommunications giant Telstra Corp Ltd and was concerned about the implications of rumoured corporate moves by the company.

Australian media have speculated in recent weeks that Telstra was interested in buying a domestic media network, with Publishing & Broadcasting Ltd's Nine Network and the Seven Network cited as particular targets.

The possible move has raised concern about conflict of interest in the government owning a commercial media operation, but Democrats leader Meg Lees that did not constitute an argument to sell off the 50.1 percent of Telstra still in government hands.

"It isn't going to be an argument that's going to swing us into selling, but perhaps it (is) an argument for looking at the rules for what is now a hybrid company," Lees told the Nine Network's Sunday programme.

The minoritiy Democrats hold the balance of power in the Senate, the upper house of Parliament.

Lees also said she was concerned about the impact on public dividends following reports that Telstra may float its lucrative mobile phone and Internet assets.

"Our problem is we don't want to see any of the profit stream being watered down or disappearing and this is one of the several parts of Telstra that is very, very profitable," she said.

Prime Minister John Howard said on Saturday he was confident of securing the full privatisation of Telstra one day, despite continued political opposition.

"We've sold almost half of Telstra and we want to sell more," he said in a newspaper interview. "I'll keep going on it and I'll eventually get it."

The government raised more than A$16 billion in late 1999 when it sold a 16.6 percent stake in the company.

Telstra also wants a full sell-off, saying it would give it greater flexibility in an increasingly competitive market.

However Lees said the Democrats would not be a part of any further sell-off, saying the first tranches of privatisation had been at the cost of public funds and regional services.

"We certainly are not going to sell Telstra for either social or economic reasons," she said. -Reuters