Communications Minister Malcolm Turnbull announces NBN review

THE NBN Company admits its rollout forecasts were overblown by hundreds of thousands as Malcolm Turnbull orders a review of the project.

THE National Broadband Network has admitted rollout forecasts promised by Labor at the election were overblown as the Abbott Government announced a review of the multi-billion dollar project.

Communications Minister Malcolm Turnbull today said the NBN Co had advised him it would only pass 729,000 premises by June 30 next year - a far cry from the 1.307 million in its latest corporate plan.

A draft plan written only four months ago in June was also way off, forecasting 981,000 premises would be passed.

The revisions - the latest in a long line of embarrassing rollout downgrades for the embattled project - also extend further into the future, with a forecast of 4.625 million premised passed by June 2016 now downgraded to 3.115 million premises.

The original 2010 corporate plan had promised 5.6 million premises by then.

The new figures emerged as Mr Turnbull today ordered the NBN to continue with the rollout amid a 60-day internal strategic review so the company can meet its contractual obligations.

The review is aimed at assessing the cost and timeline for delivery under the current specifications and what options are available to the government using different technologies.

"We expect this period of review will lead to revisions to the timing of the rollout and to updated forecasts," Mr Turnbull said.

"It is important to bear in mind however that the NBN rollout has, to date, repeatedly missed its targets."

Mr Turnbull and Finance Minister Mathias Cormann have also issued an interim statement of expectations to the company to guide the NBN Co's construction.

The statement will guide activities pending changes to the board and while a strategic review and independent audit of the project is carried out and a new NBN Co Corporate Plan is drafted.

It will also give NBN Co the flexibility to use a wider range of technologies, such as the latest VDSL technology in multi-dwelling premises, to connect businesses and homes to the network.

Mr Turnbull said a priority would be to reduce a backlog of 66,000 premises passed by the network which cannot currently obtain a service.

"This includes the majority of apartments, schools and businesses in areas where the fibre network has been rolled out," he said.

"Under the interim Statement of Expectations, construction will be completed in areas containing 300,000 premises where construction contracts have been signed."

Under the interim statement, construction would be completed in areas containing 300,000 premises where construction contracts had been signed.

Detailed network design work was underway in areas containing a further 645,000 premises.

In areas where NBN Co is in a position to hand over final designs to construction partners, some of these sites may see construction work begin shortly.

Mr Turnbull said there were also more than 900,000 premises listed on the one year rollout plan on the NBN Co website where only preliminary network design work is underway.

"Decisions about actual construction in these areas will be taken after the reviews into the NBN rollout are completed," he said.

"These decisions will ensure there is a steady flow of work on the NBN until well into 2014. This will provide certainty for contractors and ensure they do not have to demobilise workforces."

Mr Turnbull confirmed the government had asked the NBN Co board to quit but that it was not personal against any individual members and that they still continued as directors pending a Cabinet meeting next week.

"I can confirm I did request the directors to offer their resignations and all but one of them did so," he said.

"They have not resigned. They are continuing directors. That request should not be regarded as any criticism of the directors.

"The reason was simply to give the government flexibility in remaking the board in light of its new policy agenda."

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