CANBERRA—The federal government's proposed break-up of Telstra is "legislative blackmail", the opposition says.
Labor wants Telstra's wholesale and retail businesses separated - either voluntarily or by force - to create a more level playing field before rolling out its $43 billion high-speed national broadband network (NBN).
Under legislation introduced into parliament last month, the telco would be required to divest itself of its cable television interests and a 50 per cent stake in Foxtel before expanding its advanced wireless broadband services.
However, Telstra would be allowed to retain its interests in Foxtel if it submits to the Australian Competition and Consumer Competition an acceptable undertaking to structurally separate.
"What they are proposing is legislative blackmail, the results of which I think would be disadvantageous to the 22 million Australians which rely on Telstra," opposition communications spokesman Nick Minchin told Network Ten on Sunday.
"This NBN can't be built without the co-operation of Telstra, (Labor) should take away the gun at their head, negotiate in good faith with Telstra and try to come to some arrangement which would save their NBN."
The government is already in negotiations with Telstra in relation to the reforms and hopes they can be finalised by November, when the legislation is due to be debated.
But Senator Minchin said the draft laws should not be rushed through parliament in the Senate's remaining three sitting weeks of the year.
