Finance minister says Telstra shares may go to fund

The federal government may park all or some of its Telstra shares in the proposed future fund next year, Australian Finance Minister Nick Minchin says.

Senator Minchin is preparing a report for cabinet early next year setting out the government strategy and timetable for disposing of its remaining 51 per cent stake in Telstra.

It is unclear whether the government will sell its stake in one tranche or three, as the federal budget assumes.

In the event of a partial sale, unsold shares could be transferred to the proposed future fund and then sold progressively at the discretion of the independent board and its fund managers.

Senator Minchin said today it was wrong to suggest, as Labour had, that if the government was to put any Telstra shares into the future fund that it would corrupt it.

He said it was possible that all the shares may go into the fund.

"We've not made a decision to do this, but we have openly flagged the possibility that, were we not to sell all our remaining shareholding next year but only to sell part of our shares, then an option for us would be to put the remaining the shares into the future fund," Senator Minchin told the Ten Network.

"We've always said that we will dictate what goes into the fund but once there it will be for the board and professional managers of the fund to manage the fund in the best interests of that fund.

"I wouldn't rule out and we won't rule out putting all of our shares into that future fund.

"It is open to us, once the sale legislation passes, if we were to decide that the time was not right to sell even part of our holding then we could either hold them directly or we could put all of the shares in the management of the future fund."

Senator Minchin said he understood that Senator Joyce wanted to represent the Queensland Nationals' view on Telstra but all government senators needed to be united.

"We've all got to work together with Barnaby and I hope that he will, with the rest of us, vote to support this very good package on telecommunications that we've agreed to in our joint party room," he said.

Senator Minchin also confirmed that the cabinet had considered a report which looked at the impact of the Telstra sale on families.

Prime Minister John Howard last year agreed to prepare family impact statements for major law changes after discussions with Family First senator Steve Fielding.

Senator Fielding's vote on the laws to sell Telstra, which will be introduced to parliament in a fortnight, will be crucial if Senator Joyce opts to block it.

Senator Minchin said today the cabinet had considered a family impact statement on the Telstra sale.

"My recollection is there was a family impact statement for this package but it's not been our practice to release those - those have been for the benefit of the cabinet in considering major policy initiatives of this kind," he said.

But he said the government would not release the statement.

ACCC SAYS TELSTRA HAS NOTHING TO FEAR FROM NEW RULES

Meanwhile Australian Competition and Consumer Commission (ACCC) chairman Graeme Samuel said today Telstra's aggression over the new regulations was not helping the telco's cause.

Under the new rules, Telstra will be forced to split its wholesale business from its retail arm and be subjected to even tighter regulations aimed at protecting consumers.

It is part of a US$3 billion sweetener by the federal government, approved by the coalition party room last week, to help get its Telstra sale legislation through parliament.

"If you were to mark the (Telstra's) political strategy at the moment, (their) government relations strategy, you'd probably give them 15 out of 10 for aggression," Mr Samuel told the Nine Network's Business Sunday program.

"My own assessment, for whatever it's worth, is probably about three out of 10 for effectiveness."

Mr Samuel said the new regulation model had been designed to balance the interests of Telstra, the dominant player in telecommunications, with those of promoting competition in the sector.

He said the government would not be intimidated in setting the rules under which business should operate.

He said the system would create greater certainty for Telstra in terms of the environment in which it operated, a plus for both the telco and its shareholders.

"All it is about is providing much greater transparency in the way that Telstra deals with its own retail business and its other wholesale customers," he said.

"If we accept the fundamental rule, which is that Telstra should not behave anti-competitively, then Telstra has nothing to fear from the regulations."

Mr Samuel said he was cynical about speculation that the changes would knock billions off the telco's share price, saying it was in analysts' interests to talk the book down before the T3 sale.

He said greater competition would result in innovation, new investment, lower prices and more efficient and better services for customers.

A working party made up of representatives of Telstra, the ACCC and the government would work through the details of the rules in the coming months, he said.

- AAP