NBN Co, contractor relations weaken further

The relationship between NBN CO and its contractors is becoming increasingly strained, with confidential NBN working documents showing a growing bitterness between the two sides amid rollout delays, according to The Australian Financial Review.

The documents were prepared for senior NBN Co executives and, for instance, say efforts by contractor Silcar to blame Telstra for delays in the broadband network's construction “need to be refuted at all levels”, the AFR reported.

In addition to delays in the network's construction, the documents also show NBN Co is concerned about the amount of newly-completed work that will or may need to be redone. In one case, up to 15 per cent of the fibre cables in the northern Canberra suburb of Crace have to be redone.

The documents also show that by late February NBN Co was aware that it was unlikely to reach the previously promised target of installing fibre optic cabling into 286,000 existing homes by June 30, 2013.

Two weeks before [the documents were written/realeased/etc], NBN Co chief executive Mike Quigley told a Senate estimates committee the project remained on track. It was not until March 21 that he announced a three-month delay in the rollout, largely blaming construction companies' inability to hire skilled labour quickly enough.

The AFR reported that the documents show internal NBN Co staffers blaming construction partners Silcar, Transfield, Visionstream and the Lend Lease-Service Stream joint venture Syntheo for providing incorrect rollout information and paying workers such low rates that they were leaving the project.

“Inconsistent utilisation of critical resources ... is due to poor project management of the [region] by – Transfield,” one NBN Co document said, according to the AFR. “There is a lack of ribbon splicing resources available.”