Speech by Deputy Minister Radhakrishna L Padayachie (Roy) in support of the Department of Communications'(DoC) Budget Vote 24

Chairperson
Honourable Minister
Colleagues in the Executive
Members of the Portfolio Committee
Honourable Members of Parliament
Executive representatives of portfolio organisations
Industry executives
Distinguished guests

On 1 June the world celebrates Children's Day. It is a day when we remind ourselves that we work for, live for and prepare the world for a better future for our children. Side by side with this, in my culture when we celebrate children we also pay homage to the bearers of our children, we acknowledge the value and the quintessential importance of our revered women, the mothers of the nation.

It is therefore in this spirit that I must acknowledge in the audience all those of you who are mothers and who are here with us today to join with us in recalling the importance and significance of 1 June. In this context allow me to acknowledge the special presence of my wife Sally Padayachie, the mother of my children, who has graciously sacrificed her time from her business in Durban to be here in Parliament, in solidarity with me, for this Budget Vote Debate. I very much appreciate her support and presence here.

Minister, in your 2007 Budget Vote Speech you identified three interconnecting themes which described the moment we were in then. These were:

* Connecting to the future.
* "The old is dying while the new is struggling to be born" - an Antonio Gramsci concept.
* Trevor Manuel's quote of "human life has equal worth".

Today's Budget Vote however takes place in a very different historical moment. An historical conjuncture that has associated it with a remarkably different set of characteristics that indeed make this moment uniquely different.

It represents a moment characterised by:

* a closure of the mandate period of the present Government,
* a period of transition to a new administration and the challenge to manage a seamless transition,
* a global realignment of political forces and impending regime changes in the major economies of the world,
* a drastically changed set of global economic conditions characterised by high food prices, rising fuel and energy costs and widespread turbulence and global unrest in several developing countries, and
* exacerbation of domestic social, political and economic contradictions evidenced by the phenomenon of violence against foreign nationals (xenophobia), leadership changes within the ruling party, energy emergencies, rising unemployment, youth criminality and disintegrating social relations in society.

All of these coming together to produce a great sense of public unease and uncertainty and producing in turn a mood characterised by fears of an uncertain future, that things are about to slide and feelings about scenarios of doom and gloom.

This contrasts rather dramatically from the mood that characterised the beginning of this term in 2004 when were that moment,

* filled with the age of optimism and hope for the future. When we coined the phrase: "Today is better than yesterday, tomorrow will be better than today",
* we held the confidence of the people
* as a ruling party and government we came with a renewed vigour armed with the mandate of the people to eradicate poverty, fight unemployment and create jobs,
* a mandate that arose from our special contract with the people to halve unemployment by 2014 and advance significantly towards the eradication of poverty in our land.

At the commencement of our term as government in 2004 we had realised that since 1994 the Democratic State had evolved excellent policies that set the platform for the Democratisation of Society, but the key and critical aspect going forward was to enhance the capacity of the state to deliver on basic service to our people. We emphasised that in this current term, the key focus in government is on implementation of the policies. It dawned on all of us pretty quickly, in this term, that the key critical challenges to advance this were to address the challenges of:

* reorientation of our department and reconfiguring it with a new mission,
* establishing more effective inter governmental co-operation and co-ordination,
* developing leadership capacity and improving on our style of work, and
* mobilising civil society and business in collaboration with the state in implementation of governments programme.

Since 2004, Chairperson, this would be our fifth Budget Vote Debate and represents the last for this mandate term of the present administration. It is for this reason that it constitutes an especially important one and it does present us with a platform to address the question: Have we delivered on our mandate?

In this regard it would be important to trace back what we have stated over the years in respect of information and communications technology (ICT's) and our understanding of the mandate and its relation to the basic notion of delivering a better life for our people.

In the 2004 Budget Speech emanating from the Strategy and Tactics Document of the African National Congress (ANC) we identified the "central aim of transformation is to improve the conditions of the people, especially the poor".

"We identified poverty as the single greatest burden of the people and attacking poverty as the first priority of the democratic government".

We correctly posited the role of technology in all of this as a central enabling role in promoting economic development and the social well-being of our people. We accordingly re-engineered the Department of Communications and re-tooled it with a new vision and mission, in which we committed to becoming a global leader to harness ICTs for socio-economic development by enhancing the well-being of our people, the African continent and the creation of a sustainable ICT technology environment.

In the 2005 Budget speech we identified that the future is a matter of choice and not chance. We identified the impact of globalisation on our policy development processes and correctly understood that globalisation and deregulation were the major driving forces transforming the world of ICTs. The combination of global open markets and innovative technology had led the way to a new era of information communication technology convergences resulting in the dissolution of previously market segments such as telecommunications, broadcasting and data. A development that heralded the necessity for a redefinition of the Licensing Frameworks and regimes resulting in a major legislative and ICT landscape change ala the Electronic Communications Act (ECA) and the Independent Communication Authority of South Africa (Icasa) Amendment Act. A central piece of our work here was the recognition that we needed to advance the growth of the second economy and keep abreast of developments in the first economy. A major emphasis was to devise strategies to effectively bridge the digital divide and guarantee a legislative framework that would allow for the absorption of new technologies and utilise this to leapfrog the development divide between our urban and rural areas.

In the 2006 Budget speech we reaffirmed the role of ICTs as an enabler of economic growth and as a development trampoline to get our people out of the poverty trap. We focussed on legislative and policy processes to advance broadband and digital migration and to ensure that we are adequately preparing ourselves for the successful hosting of the 2010 FIFA World Cup.

In the 2007 Budget speech we reaffirmed the idea of the Freedom Charter at the centrality of our vision of the construction of a National Democratic society in which ICTs have a crucial enhancing role. We identified the responsibility of the ICT sector to contribute to the creation of jobs in line with the Presidential perspective that "none of the great social problems we have to solve is capable of resolution outside the context of the creation of jobs and the alleviation and eradication of poverty".

In this regard we identified three major challenges to our programme going forward. These were:

1. reducing the costs of communication,
2. bridging the digital divide and enhancing universal access,
3. addressing the challenges of the ICT skills deficit in the country.

In the course of this year it is necessary that we add a fourth critical challenge. This relates to the role of ICTs in enhancing social cohesion and in particular the importance of the Public Broadcaster in advancing this strategic objective.

In the current Medium Term Expenditure Framework (MTEF), the department's baseline allocation over the next three financial years from 2008 to 2011 is a total of R5,20 billion. This is split over six programmes:

1. Administration R466 million
2. ICT International Affairs and Trade R138 million
3. ICT Policy Development R368 million
4. ICT Enterprise Development R3,83 billion
5. ICT Infrastructure Development R300 million
6. Presidential National Commission R103 million
Total R5,20 billion

The major part of the expenditure in this medium term expenditure framework (MTEF) budget relates to ICT Enterprise Development (Programme 4). This programme identifies the following objectives and measures:

* contribute to meeting universal service and access objectives by monitoring the progress of the South African Post Office's rollout of 85 new branches and 81 upgrades or relocations by March 2009,
* improve broadcasting services in South Africa by overseeing Sentech's rollout of 175 digital ready transmitters by March 2009,
* align the business and investment plans of public entities with the strategic objectives of the Department of Communications,
* contribute to improved financial management by ensuring that all public entities receive unqualified annual audits, and
* encourage the use of ICTs by SMMEs by developing 10 000 e-commerce websites by 2010/11.

The minister in her speech had dealt with the department's initiatives in Policy and Regulatory reforms, the APEX priority project building a foundation for an Inclusive Information Society, the Challenge of Broadcasting Digital Migration, Investments in ICT Infrastructure and the 2010 Preparations in respect of the FIFA World Cup. The minister also outlined several initiatives of the department aimed at reducing the costs of communication.

Allow me to add one additional element that will have a bearing on the strategies in this matter going forward. A major change that we could anticipate going forward is a change in the competition regime in respect of telecommunication matters. Under the present ECA Act ICASA functions as a sector regulator for competition matters in the ICT sector. This counter poses with the Competitions Commission that also acts as a Competitions Authority, thereby resulting in what is described as "Concurrent Jurisdiction". This is seen by the Competitions Authority as seriously problematic, thereby necessitating the need for a clarification and delineation of responsibilities of the sector regulator ICASA with that of the Competition Authority.

It may be anticipated that with the upcoming Competitions Amendment Act, the Competitions' Commission will be vested with the final authority to adjudicate on competitions matters within the telecommunications sector and to carry the responsibility to initiate a market enquiry in the telecommunications sector. This will necessitate a consequential amendment of the current ECA Act and is likely to have a significant bearing on costs issues within the ICT sector.

A central challenge to the implementation of the Information Society and Development (ISAD) Plan stimulated by the World Summit on Information Society (WSIS) Declarations is the serious shortage of ICT skills and the state's limited capacity to deliver on these critical skills.

In order to meet these challenges the ISAD Plan identified a number of actual pillars for action. Education, skills development and training were identified as one of the five priority focus areas for ICT action and development. The shortage in ICT skills is a problem that confronts several economies in the globe and is not a problem unique only to the South African economy.

In his 2002 State of the Nation Address, President Mbeki committed the Government to the establishment of an Information and Communication Technology (ICT) University. The commitment to build the relevant ICT skills was sparked by mounting evidence of a relationship between the capacity for ICT use and socio-economic development. This view was supported by persuasive arguments in the Presidential International Advisory Council on Information Society and Development (PIAC on ISAD) in the months following its establishment in 2001.

The African Advanced Institute for ICT (Meraka) was established in 2004. This was approved by Cabinet in 2002, as an alternative to the establishment of an ICT University.

The purpose of the institute is to facilitate national economic and social development through human resource development and needs-based research and innovation, leading to products and services based on ICT.

The current Meraka Institute, which is housed in the Council for Scientific and Industrial Research (CSIR), however, focuses almost exclusively on two of the three legs envisaged, namely research and development and applications development. These are the responsibility of the Department of Science and Technology.

After the meeting of the PIAC on ISAD in August 2007 at which the establishment of an e-Skills Council and an e-Skills Working Group was endorsed, the DoC embarked on the operationalisation of the third leg of Meraka - the Meraka e-Skills Institute. Dr Harold M Wesso (DDG: ICT Policy Development) has been seconded to drive this process as Acting CEO of the e-Skills Institute.

At present the department has completed an International Study Tour of best practices in this area and visited six countries of which a report is currently available. The current focus of the work is centred on refining the conceptual model for the e-Skills Institute and implementing the first steps in its operationalisation.

The operationalisation of the e-Skills Institute by the DoC as a co-ordination hub for ICT skills development, led to Joint Initiative for Priority Skills Acquisition (JIPSA) taking a decision to hand-over all its ICT initiatives to the DoC as project owner.

Government acknowledges that the shortage of skills in the ICT sector remains a constraint for the growth of the sector and the economy.

On the occasion of my Budget Vote Speech last year I spoke at length on this matter, including the establishment of the South African e-Skills Council which constitutes government, business, academic, labour and civil society institutions.

The inaugural meeting of the council mapped a work programme that ensures that the country will produce job ready, better skilled and a more adaptable workforce.

I am pleased to announce that on 13 March 2008, as a further development addressing the skills shortages in ICT, the president launched the South African e-Skills Academy. The academy is a collaboration of private sector companies with the sole purpose of assisting the country in addressing this challenge.

In addition to these Nemisa have forged valuable international linkages with training institutions in Canada, France, India and Malaysia to share best practices and information on new developments. It has also established links with the Commonwealth Broadcasting Association (CBA).. Similar initiatives at skills enhancement were undertaken by South African Broadcasting (SABC), Telkom, Sentech and the Further Education and Training (FET) Colleges through its e-Skill programme.

Achieving universal service and access remains a policy priority going forward. Several challenges must be addressed in order for there to be demonstrable evidence of measurable progress in this regard. Problems relating to infrastructure expansion, skills development and relevant and appropriate application for the rural areas remain a considerable challenge.

A central aim must be to provide consumers and businesses with a diverse offering and choice of ICT services at competitive prices at the same time guaranteeing universal access to basic ICT services for all citizens.

Statistics South Africa, in its consumer survey of 2007 of 238 067 dwelling units reported an increase in the ownership of radio, television, computer and cell phones between the 2001 and 2007 surveys.

In so far as cellular phones were concerned the survey in 2001 reported a 32,3 percent ownership. This in the 2007 survey had grown to 72,9 percent. Radio had grown from 73 percent in 2001 to 76,6 percent in 2007. Computer ownership had grown from 8,6 percent in 2001 to 15,7 percent in 2007 while television ownership had risen from 53,8 percent in 2001 to 65,6 percent in 2007.

Significantly the demand for landline telephones decreased owing to an increase in the popularity of mobile phones. Land lines decreased from 24,4 percent to 18,6 percent. No comparison could be made in the 2007 survey on internet facilities which recorded an ownership of 7,3 percent.

Such increases are a good barometer to demonstrate that increasingly more South Africans are being exposed to ICT. Should such a trend continue exponentially in the future it would contribute considerably to closing the digital divide and enhancing digital opportunities for more of South Africa's citizens.

In this regard, Universal Services and Access Agency of South Africa (USAASA) has been particularly outstanding in the execution of its mandate. It has co-operated in supporting the establishment of a number of multi-media centres, cyberlabs and telecentres in various parts of the country. Two of the multi-media centres were dedicated to honour Commander Phungula Johannes Phumani (Passfour) a veteran of Umkhonto we Sizwe who is also a Member of Parliament in the Ixopo area and George Sewpershad, the deceased ex-president of the Natal Indian Congress in Phoenix. The George Sewpershad Multi-Media Centre was sponsored by Bytes Technologies.

Several initiatives via SAPO also resulted in bringing ICT services closer to the people such as:

* the launch of the Postbank visa card for elderly clients, thereby reducing the necessity to carry cash
* roll out of a further one comma nine million postal addresses thereby bringing the country wide total to 10 million postal addresses
* opening of 72 new post offices of which 52 are in rural under-serviced areas
* conclusion of agreements with seven municipalities for the collection of municipal rates and taxes
* partnering with the provincial government in the renewal of motor vehicle licenses
* partnership with the South African Social Security Agency (SASSA) in disbursement of social security grants, and
* Sentech's partnering with various organisations in delivery of e- government services.

The current debate around the SABC Board arising from the vote of no confidence in the SABC by the Portfolio Committee on Communications has highlighted many critical challenges for the Public Broadcaster going forward. The issues that have surfaced around this matter has now taken the whole saga well beyond the initial catalysing concerns around the representivity of the current SABC Board and the nominations and appointment processes of the current Board members.

The ensuing national debate on this matter has surfaced the following key matters requiring immediate, medium and longer term corrective actions:

* the need to improve the representivity of the current board
* urgent action to address the internal managerial
* administrative weaknesses in the SABC, governance matters and the need to improve the relationship between the board and management of the SABC
* the need to address the inadequacies in the current legislation governing the SABC board in that no provision is made for the removal of the board by the appointing authority, in circumstances in which parliament has lost confidence in the competency of the board
* similarly no provision is made in the law for the removal of a single director in similar circumstances should parliament be of the view that it has lost confidence in the performance of a single director and
* a wide ranging diversity of views on a variety of matters pertaining to the appointing and removal processes of board members, the independence of the public broadcaster and the extent to which the public broadcaster is adequately meeting its public service mandate.

To address the above challenges it may well be necessary to consider instituting the following measures:

1. The ministerial institution of a professional Task team to address the requirement of administrative and managerial support to the board and its management in respect of the governance matters.
2. The hosting of a parliamentary led process of public consultations on the restructuring of the public broadcaster and various other matters pertaining to its appointment and removal processes, its independence and governance regime. The collation by the Portfolio Committee on the submissions for consideration by the department.
3. The Department of Communication to feed this into and initiate the formulation of a new public broadcasting law to replace the current legislation.

In conclusion I would like to express my sincere appreciation to USAASA for its exceptional support in the delivery of its multi-media centres and telecentre initiatives, to its Chairperson Ms Cassandra Gabriels, its CEO Mr James Theledi, its KwaZulu-Natal Provincial Manager, Mr. Mandla Sithole, and its other staff and field workers.

To the Minister and Director-General for their support and colleagueship and to the staff of the department for their continuing commitment to public service.

To the members of the Portfolio Committee on Communications for the excellent work and the private and public sector companies for their support in our work.

I am also very appreciative of the staff of my office under the leadership of Mr Raymond Reddy for their continuing commitment and dedication.

I thank you and commend the Budget presented by the Minister.

Issued by: Department of Communications
3 June 2008