Chorus will struggle to meet its fibre network contractual obligations is regulated cuts to copper access prices go ahead according to Ernst & Young Australia.
The accounting firm reported its preliminary findings to Communications Minister Amy Adams and told her the proposed regulated price cut will have a ‘significant impact’ on the company’s finances.
The next step will see Chorus dragged in for discussions with Crown Fibre Holdings, the government organisation overseeing the Ultra-Fast Broadband project.
This may see some renegotiation but a statement from Adams’ office underlines that the government expects Chorus to make a ‘significant part’ of any shortfall.
Earlier this week Prime Minister John Key ruled out putting more government money into the project. He also said the project would not be slowed down.
Those comments came after the minor parties revolted against a government move to legislate changes to the telecommunications laws which could have seen the Commerce Commission’s decision on copper access prices over-ruled.