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2012 Extension of Telstra’s retail price controls

Post‑implementation Review – Department of Communications

On 26 June 2012, the then Minister for Broadband, Communications and the Digital Economy made a decision to extend the expiry date for Telstra’s retail price controls by two years from 30 June 2012 to 30 June 2014. Telstra’s retail price controls applied to most Telstra fixed line telephony services, and were designed as price caps that aimed to address a potential lack of competitive tension in fixed line service pricing, promote greater social equity and ensure that efficiency gains were passed on to retail customers. Since this decision to extend the expiry date on the retail price controls, the Minister for Communications revoked these controls on 18 March 2015. The proposal was assessed as likely to have a significant regulatory impact on the economy, and was therefore subject to the preparation of a RIS. However, an exemption from the best practice regulation requirements was granted by the then Prime Minister. This exemption also required the Department of Communications to prepare a post-implementation review (PIR) within two years of implementation. The proposal was implemented in June 2012. A post-implementation review (PIR) was completed by the Department of Communications in July 2015 and was assessed as compliant by the Office of Best Practice Regulation. The PIR found that over the two year period of the extension, the regime imposed an annual regulatory burden of $0.246m with no discernible impact on prices. Therefore, the decision to extend the Telstra retail price controls imposed a net economic cost on the community.