At least eight million premises should have speeds of up to one gigabit per second by 2023.

The upgrade will be financed through NBN Co borrowing from private debt markets.

Communications Minister Paul Fletcher said with 99 per cent of premises now able to connect to the NBN, the time was right to upgrade the network.

Fletcher said the coronavirus pandemic had also changed the way people used the internet and highlighted the need for speed.

“There is a long term trend of broadband demand growth with a very significant spike this year,” he said on Wednesday.

The upgrade signals a significant change in the coalition’s approach to the NBN.

Labor originally planned to connect most Australian homes to the NBN through fibre to the premises.

The coalition scrapped this approach after coming to power in 2013 in favour of mixed technologies.

Fibre was instead rolled out to “nodes” near houses or apartment blocks, which people would connect to via copper wires, often leaving them with much slower connections.

Labor has panned the policy reversal, arguing the coalition should not have changed the plan in the first place.

“This has to be the most extraordinary wasteful public policy backflip in a generation. This government has built a network that costs more and does less,” Labor communications spokeswoman Michelle Rowland said.

“This government has been opposed to having world-class fibre-based broadband and all of a sudden this is visionary, it is going to be a driver for jobs.”

Fletcher argues Labor’s plan would have built fibre everywhere before people were willing to pay for it.

His plan involves on-demand fibre to the node upgrades, capacity upgrades on the hybrid fibre coaxial network and work on the fibre to the curb network.

From an economic perspective, the NBN is estimated to increase Australia’s gross domestic product by $6.4 billion a year by 2024, including $1.5 billion in regional areas.