Council Reports on Norfolk Telecom Satellite Backhaul Service

Published on 02 April 2026

At the 1 April 2026 Ordinary Council Meeting, Norfolk Island Regional Council (Council) tabled a report to openly outline issues surrounding Norfolk Telecom’s satellite backhaul service, which provides internet connectivity for Norfolk Telecom customers.

Background

On 28 September 2022, the Department of Infrastructure, Transport, Regional Development, Communications, Sport and the Arts (DITRDCSA) wrote to Council indicating that it would support funding in the amount of $7.35 million over two financial years to uplift Norfolk Island’s satellite connectivity, provided that priority bandwidth allocation was provided to Norfolk Island Central School (NICS) and Norfolk Island Health and Residential Aged Care Service (NIHRACS). Council undertook a tender process and awarded a satellite backhaul contract to Telstra in 2023.

Grant funding for the monthly charges associated with the satellite backhaul service concluded in December 2024, but the initial term of the Telstra contract awarded in 2023 continued until January 2026.

Satellite Backhaul Cost and Service Level

The tabled report outlines that, following the expiration of the Commonwealth operating grant in December 2024, Council has absorbed the full, unsubsidised cost of providing satellite backhaul services to two major public sector customers; NICS and NIHRACS.

The cost incurred by Council in providing unsubsidised services to NICS and NIHRACS (at no fault of either agency) since December 2024 totals an estimated $2.1 million in unrecoverable revenue.

Council acknowledges that it did not take a sufficiently proactive approach to managing the financial and commercial risks associated with this arrangement during the 2024–2025 calendar years.

Separately, Council was recently made aware that its current wholesale satellite backhaul plan through Telstra was priced with a higher level of internet bandwidth than the Island requires, as evidenced by Norfolk Telecom utilisation reports. This higher bandwidth level was originally selected based on the grant funding parameters. Council is now working towards a new, more sustainable and fit-for-purpose wholesale service level agreement that will continue to meet community and business needs.

Telstra Invoices

In addition, during the month of March 2026, Council was made aware of six (6) overdue Telstra satellite backhaul invoices (August 2025 – January 2026) totalling $1,432,876. The Acting Deputy General Manager investigated the issue and determined that invoices had been issued to an inactive email address, and no action was previously taken by Council to update Telstra’s records.

Council is engaged in productive discussions with Telstra to rectify this issue while simultaneously minimising undesirable impacts on Council’s cash position. Telstra has indicated its willingness to enter into payment arrangements with Council, with the outstanding balance to be resolved by 30 June 2026.

Council recognises these errors and the impact this has on our stakeholders and the community. Council takes full responsibility for this failure of oversight and is focused on resolving the matter promptly and in a cost-effective manner.

Council has begun implementing corrective actions to mitigate the impact, taking the following steps:

Negotiate with NICS and NIHRACS to secure an appropriate fee-for-service model arrangement for their telecommunication services.

Negotiate a new twelve-month service agreement with Telstra for the ongoing provision of satellite backhaul services, subject to confirmation of service level requirements from NICS and NIHRACS. This would result in a significant reduction from Council’s current satellite backhaul cost of $238,734 per month, with a potential to reduce costs further to $131,718 per month.

Request that Telstra retrospectively reduce the total amount owing on monthly invoices issued in February 2026 and March 2026 to reflect the new monthly fee under the proposed twelve-month agreement.

Negotiate a repayment plan with Telstra to ensure that the outstanding balance associated with the overdue payments is fully paid by 30 June 2026.

Review internal processes to prevent a repeat of this issue.

Council reassures the community that this issue poses no risk to internet or voice connectivity.

Council is committed to providing the community with timely and transparent updates as work continues with Telstra and other key stakeholders to achieve a fair and reasonable resolution.

In keeping with Council’s commitment to openness and transparency, the full report is available for public viewing here: www.nirc.gov.au/files/assets/public/v/2/your-council/documents/nirc-media-releases/2026/134-norfolk-telecom-satellite-backhaul-service-1-april-2026-ocm-tabled.pdf

For more information, please read the Frequently Asked Questions in this media release, or contact Customer Care on +6723 22001 or free call 0100 or customercare@nirc.gov.nf.