PATRICIA KARVELAS:
From around 4 am yesterday morning millions of Australians, businesses and essential services lost critical mobile and Internet function. Optus went down for more than eight hours but the company has so far failed to explain exactly what went wrong.
This morning the federal government has announced a post‑incident review. As businesses count the costs of the outage there are growing questions about why there wasn't a contingency in place.
Stephen Jones is the Assistant Treasurer and the Minister for Financial Services and our guest this morning. Welcome.
STEPHEN JONES:
Good to be with you, Patricia.
KARVELAS:
How much do you anticipate this outage has cost business in the last 24 hours?
JONES:
Oh look, there'll be thousands and thousands of small businesses who had their EFTPOS machines, their tills unable to work, and if they were unable to take cash they were losing customers.
I expect a significant impact on small business, everything from, you know, flower shops to Uber drivers who have been impacted by it, and of course, you know, the risks associated with that for consumers as well. Reports that 000 calls were unable to be made from landlines, et cetera.
There are significant and far-reaching consequences, not just economic, arising from this outage.
KARVELAS:
Yeah, just basic health and safety consequences.
JONES:
Correct, yeah.
KARVELAS:
So what kinds of impacts are businesses reporting from the outage and who was the worst affected?
JONES:
Haven't got that data yet, Patricia, but we know everything from bank call centres unable to take calls, to some ATM machines, EFTPOS machines. You know, small businesses obviously are the ones who are going to be hit the hardest because they're living from week to week, cash flow is critical and if they are down for a day or half a day and that's the busiest part of the day as it is for cafes and bakeries and many of the businesses who are affected and, you know, they've lost a day's takings and many of them are already doing it tough.
The small business sector I've got to say will be hard hit but it's not exclusively there. I know in the sector that I'm responsible for, the financial services industry, there was significant disruption there as well.
KARVELAS:
What are the broader risks, Minister, from an outage like this for the financial system and what sorts of measures do you think should be in place to limit that damage?
JONES:
You know, Patricia, system stability is critical. Whether you're a major financial institution, a small business or an ordinary consumer everything is run through our mobile phones these days.
My kids don't know what a Gregory's atlas is. Everything is done, whether it's navigating, whether it's paying a bill, whether it's making phone calls, so many people no longer have landlines any more. So the stability in our mobile network is absolutely critical.
It's why Michelle Rowland has called the review. We've got to ensure ‑ we know that outages happen from time to time, highly technical networks, you know, a lot of moving parts in them, a lot of software involved. It's why we need to work out exactly what has gone on and learn from those mistakes, from both a technical point of view, but frankly also from the way it was managed from a customer point of view and the communications that were made by the company to the country and to the customers of Optus. They were absolutely subpar.
KARVELAS:
Subpar is one way to describe it. It's a massive fail, wasn't it?
JONES:
I'd say so and you'd have thought coming off the back of the previous data breach where, you know, they were facing similar calls from customers to explain exactly what was going on this simply wasn't good enough.
My colleague Michelle Rowland was out there trying to fill the gaps. It's not her job as the Minister to explain what's gone on inside of a company, it's the company's job to do that. Customers had no idea what was going on.
KARVELAS:
That's right, she made herself available to us yesterday when the company wouldn't.
JONES:
Yeah, which is just bizarre would be the kindest thing you could say about it. Just not good enough frankly, and I think the customers of Optus are all saying the same thing today.
KARVELAS:
I spoke to an analyst earlier who said Optus is behaving as if it's too big to fail. Is that how you see it?
JONES:
Look, I look at this from a ‑ no, I don't. It's absolutely critical that we have competition in the telecommunications industry. It's brought prices down for consumers, it means there's more innovation than there would be in, you know, the old days when we had one government‑owned carrier.
But competition has got to bring with it a minimum level of standards and stability in the system and that's exactly what the inquiry that Michelle has launched yesterday, or announced today, is going to look to, so that if a failure in one company has learning for it then we spread those learnings to everywhere else across the system.
KARVELAS:
Okay, so that needs to apply across the industry?
JONES:
Yeah, look, if there's something that's gone wrong and there's a learning from it we've got to ensure that that applies right throughout the rest of the industry, and I know that's what Michelle wants to get to.
KARVELAS:
Optus still can't say exactly how this outage happened and why it lasted so long. Should customers and businesses be given compensation?
JONES:
It has to be on the table. There's no doubt that it has to be on the table. If you're a small business that's lost a day's takings because your phone system wasn't working then you're going to be asking those hard questions. So compensation absolutely has to be on the table.
KARVELAS:
The Communications Minister says this incident goes to the heart of our reliance on our devices for information and communications. You made the joke about the Gregory's, I think it's called ‑ the Melway's it was called in Melbourne for people listening and lots of other names other States too. Clearly we do rely on our mobiles for pretty much everything. Does it mean telcos have now an extra responsibility to have contingencies in place, and what's the government's role in ensuring that that's there?
JONES:
Well we have universal service obligations –
KARVELAS:
But they're failing.
JONES:
– which are applied in relation to fixed line networks. I know Michelle is very tuned in on this issue and wants to ensure that for all the reasons you've said and many more, whether it's economic security, national security, livelihoods and lives, we need to ensure that we have system stability.
Now that doesn't mean that there won't be an outage. It would be reckless to promise that there'll never be an outage, but when one happens it's limited, it's quick and there's a quick recovery, and there needs to be a recovery plan in place and it needs to be communicated and if there wasn't in place in relation to this incident there'll be a lot of Optus customers making the reasonable judgment that it wasn't good enough.
KARVELAS:
So if it's not good enough and this failure happened under our current regime, is there a case for law reform?
JONES:
I'll leave that to my colleague Michelle Rowland. My bit in this is as the Consumer Affairs Minister and ensuring that consumers' rights are upheld.
But in terms of all of those technical issues around telecommunications regulation, I mean there's no one in Parliament who knows more about it than Michelle Rowland. She was a telecommunications industry lawyer before she came into Parliament and she's very attuned to the issues that need to be looked at in this area, and if there is a case for reform she'll be leading it.
KARVELAS:
And do you think consumer rights have been upheld?
JONES:
Well it depends what happens from here. It depends what happens from here, Patricia, as to how customers are dealt with in the wake of this outage.
I'm particularly mindful of the circumstances of those small businesses who have lost a day's trading. They're the ones I'm particularly focussed on, and I know my colleague Julie Collins, the Small Business Minister, is also concerned about them.
KARVELAS:
Do you have faith in the CEO Kelly Bayer Rosmarin?
JONES:
Oh look, I just don't think it's helpful, Patricia, if –
KARVELAS:
It might not be helpful but, you know, is it –
JONES:
Yeah, I don't –
KARVELAS:
Really? Second time under her watch.
JONES:
Frankly, I want her and all the other senior executives in Optus focussed on dealing with the clean‑up and not looking over their shoulder about what a government minister might think. It is a matter for the –
KARVELAS:
Are they capable of the clean‑up though?
JONES:
That's a matter for the Board and the shareholders of Optus. I don't think it's helpful, but I speculate. In the immediate I want them focussed on the clean‑up.
KARVELAS:
Minister, just one question on another topic before I bid you farewell. Let's look at the RBA's rate rise early this week. Seek data shows that job ads fell sharply last month, especially in New South Wales and Victoria where they fell 5.1 per cent and 6.8 per cent respectively. Treasury and the RBA have said unemployment will go up. Are we seeing that now?
JONES:
Look, we know that economic activity is slowing. We know that consumption and demand in nondiscretionary areas is slowing down so consumers are making choices, households are making choices about how they spend their money focussing on the essentials and the things they have to pay and winding back on the nonessentials.
So we know that the rate rises are hurting hard and they are materially impacting on how people are spending their money, which is why we're so focussed from our point of view of ensuring that we can provide that sort of targeted relief that Jim has spoken to you about at length this week and others have to households where we can, but we don't do anything reckless that makes a difficult situation worse. That's why we are banking the majority of the new revenue that's come in and using it pay down the previous government's debt.
This is not a time for a spending spree, this is a time for fiscal constraint and doing what we can where we can to help households through a difficult period.
KARVELAS:
Thank you for your time this morning, Minister.
JONES:
Good to be with you.
KARVELAS:
Assistant Treasurer and Minister for Financial Services Stephen Jones. You're listening to ABC RN Breakfast this Thursday morning, it's 13 minutes to 8.