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SA: Statement by Siphiwe Nyanda, Minister of Communications, on Information and Communication Technologies (26/04/2010)

26th April 2010


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/ MEDIA STATEMENT / The content on this page is not written by, but is supplied by third parties. This content does not constitute news reporting by

The Department of Communications' 2010 budget takes place against the backdrop of a global recovery from a delibetating economic crisis, in which once more the poorest nations have been severely affected. The impact of this recession is most felt in the developing world where aid and investment from the rich countries has shrunk considerably, resulting in job losses and increased poverty.

South Africa like any other developing country has not been immune to the effects of the recession. Given the commitments we made to the voters in 2009, we as government should not shy away from our responsibility to deliver on the mandate they gave to us to ensure that their livelihoods are improved.


Our approach in building the developmental state can no longer be along the same old ways. Our government has introduced a clear programme of action to overcome our developmental challenges. In his 2010 state-of-the-nation address President Jacob Zuma emphasized the need to create sustainable jobs, to provide opportunities for the youth and to ensure rapid service delivery for marginalized areas.

ICT is a potentially transformative developmental tool, provided it is well located within the overall policy framework and is not seen as an end in itself, but a necessary means. It is the hump that feeds the camel.


ICT strategy should be determined by the reality of our people's needs. These needs are among others, our human resource development, ICT growth and competitiveness and the upliftment of the underdeveloped rural areas. Our strategic objective is to encourage social access to technologies within a people centered, development orientated paradigm. Our people should be empowered to access information and knowledge to bring about social transformation and cohesion.

Sustainable service delivery that impacts on communities require the effective use and deployment of appropriate integrated ICT at all levels. Building the developmental state without effective appropriation of ICT across government, business and civil society will delay and hamper the achievement of our developmental goals. ICT is a catalyst for service delivery and the backbone of 21st century socio-economic development.

In 1995 our Government initiated the development of a South African Information Technology Industry Strategy (SAITIS) project, which set out an Information and Communications Technology (ICT) Sector Strategy Development Framework for South Africa. Its main objective being to quote: "the bridging of the global development gap and the development of a robust, growing and sustainable ICT sector that would directly support and contribute to sustainable economic growth, social upliftment and empowerment" unquote. The SAITIS estimates that the telecommunications sectors contribution to GDP is more than 7%. It has therefore become important for us to quantify business streams within the industry which contribute to the current 7%; this will assist us to develop appropriate policies that will add to the sector's contribution to the GDP.

The question that arises is: What are we doing to develop policies and regulations that will stimulate further growth in the sector in order to attract new investors and create more jobs?

In the previous financial year we committed to develop and pass policies and legislation aimed at further growing the ICT sector.

The Radio Frequency Spectrum Policy has been approved by cabinet. This policy provides for spectrum management, which involves the allocation of frequency according to the country's developmental needs and International standards. It will ensure efficient radio frequency utilization and management of this scares national resource. In addition, this policy will further contribute to economic growth by promoting new services where required.

We have finalized the Broadband policy whose vision is to ensure that South Africans have universal access and services to broadband by 2019. The benefits accruing from the policy will include the provision of multimedia and e-Government throughout the country. The implementation of the Broadband policy will impact on the growth of the economy through expanding markets, increasing business efficiency and promoting competition.

The South African Post Office (SAPO) Bill has been submitted for consideration to parliament. The SAPO Bill seeks to establish a governance model for the Post Office that will ensure greater transparency, accountability and efficiency.

We can highlight some of its successes such as the roll out of 47 new post office branches in the past financial year. Revenue increased to 6.3 billion rands due mainly to the increases in revenue in the Post Office's mail and financial services. This was because of expansion of addresses and value added financial services.

Its branch expansion programme will continue with the addition of 20 new offices and relocation of 11 other offices.

I wish to commend the Post Office for maintaining a good financial position. In the light of the fact that most of our people are rurally based and do not have access to banking services, I would urge the Post Office to accelerate its expansion programme including allocation of physical addresses , as this has a direct impact on connectivity and other services such as banking. This will additionally improve the Post Office's market reach.

The Post Bank Bill, which is also before the House seeks to corporatise the bank so that it exists as a separate independent legal entity. I wish to stress that corporatisation should not be misunderstood to mean privatization, or even that consideration of such is likely in the future. The Post Bank will render transactional services and lending facilities through, amongst others, existing infrastructure of the Post Office, and develop into a bank of first choice, particularly to communities that have little or no access to commercial banking services or facilities. The Post Bank will also respond to local community banking needs which will minimize travel costs.

The Cyber security policy was gazetted in February 2010 for public comments. The policy is being discussed with relevant stakeholders.

We intend in this parliamentary session to introduce legislation aimed at further strengthening our ICT policy framework. We will therefore table the following bills:-
ICASA Amendment Bill
Public Service Broadcasting Bill Electronic Communications Amendment Bill
In addition, a policy directive will be issued to Icasa to conclude the unbundling of the local loop.

We have commenced with the development of the Local Content Strategy. However, this will be finalized once the South African Local Content Advisory Council is appointed. The purpose of the strategy is to promote the development of local content, as well as identification of niche economic opportunities in the sector.

Our interventions have stabilized the Public Broadcaster which was plagued by serious corporate governance and financial challenges. In June 2009, I established a Ministerial Task Team to investigate deeper the root causes which led to the collapse of corporate governance and financial challenges at both the SABC and Sentech, . The task team concluded their assignment, and we are beginning to see the positive effects of their recommendations.

As you will recall the SABC was hit by a liquidity crisis and organizational instability. An Interim Board was appointed, which engaged with management in putting in place mechanisms to ensure curtailment of expenditure and revenue increment. The corporation was granted a R1, 4 billion government guarantees, to enable it to borrow from private banks. A tripartite monitoring team comprising officials from DOC, Treasury and the SABC has been established to monitor the financial performance of the corporation, and its adherence to the terms and conditions underpinning the government's guarantee. We will ensure that the SABC does not do anything to trigger the recall of the guarantee, and that the going concern status of the corporation is not compromised.

A new board was appointed and continues to implement a turnaround strategy which includes austerity measures to enhance revenue and reduce costs.

The corporation's radio sales unit achieved its sale targets and recorded an 11 % improvement in advertising. Going forward, the corporation must implement the turnaround strategy. It must support delivery on the core mandate. The corporation must focus on procuring local content over the current MTEF.

I wish to thank the SABC for developing public viewing areas for the World Cup, as this further contributes towards bringing broadcast services to our people. I am sure that this will not only be a once off service, but that access to quality broadcasting services will continue to be a top priority for the SABC.

New board members and a Chairperson for Sentech have been appointed. I believe this will bring about greater purpose to the organization and allow it to focus on the delivery of the mandate for which it was created. The process to fill the position of the Chief Executive Officer is currently underway.

Sentech is a strategic state entity whose main function is that of the signal carrier for the state. In the past financial year, Sentech continued to maintain terrestrial analogue television and radio transmission at 99.9% beyond customer service levels, which is the technical definition for uninterrupted service provision.

For the 2010/11 financial year, Sentech will continue with the rollout of the DTT infrastructure. Sentech is critical in the provision of digital terrestrial television. Its target is to reach 60% population coverage by the end of the financial year 2010/11. We will monitor the process of implementation. Let me take this opportunity to thank Sentech and Telkom for collaborating in providing the ICT infrastructure for the 2010 FIFA Soccer World Cup.

For the past five years, the cost to communicate and doing business in South Africa has been impeded by exorbitant charges. In my maiden speech in 2009 I signaled my desire to bring down the cost to communicate. Today I am proud to report that South Africa is well on its way to reducing cost to communicate.

In November 2009, a policy directive for Icasa was issued to initiate a process to reduce the mobile termination rate (MTR) down to cost. Simultaneously, we engaged in process of consultation and discussion with the mobile operators for them to voluntarily begin to reduce the MTR. This then culminated in an agreement for an initial cut of the MTR from R1.25 to 89 cents with effect from 1 March 2010. In line with this, Icasa approved a revised amended Interconnection agreement. Further, I wish to acknowledge and recognise the commitment that the three mobiles operators exhibited by voluntarily introducing much cheaper packages to cater for the needs of the poorest during the December 2009 festive season. Icasa has now released draft regulations aimed at ensuring cost based MTR rates in July 2010 on a gliding scale. Telkom committed to pass-through the savings emanating from the reduction in the MTR back to the consumer and this is already yielding positive benefits to consumers.

Let me take this opportunity to thank Cell C, Vodacom, MTN and TELKOM for co-operating with both my department and the Portfolio Committee on Communications and Icasa to bring down the cost to communicate.

The next phase of cost cutting measures should involve the retail market which supplies services directly to consumers. Lastly, Cabinet has adopted the Departments Programmes of action on initiative to reduce cost to communicate.

A stable regulatory regime is necessary for us to address key ICT developmental challenges. Icasa will therefore need to focus critically on the following:
regulatory certainty,
promotion of ICT sector;
aligning its structure, leadership and culture with the strategy licensing for new services and
Achieving universal service and access.
Icasa is urged to accelerate finalization of all outstanding regulations because that will have a positive bearing on the development of the industry.

The department has over the past year reviewed and audited all existing outstanding commitments related to spectrum licence obligations. You will recall that in 2004 and 2006, when spectrum licences were granted to mobile and fixed operators, specific universal service obligations were included. My department has recently interacted with mobile operators to urge them to expedite delivery of ontheir commitments towards commitments. The department has agreed with the operators to establish a working team to pursue these obligations. Icasa, USAASA, National and Provincial departments will be an integral part of this working group.

We reached an agreement with the mobile operators to avail 80,000 mobile units by May 2010, which will be distributed to the Police, Safety and Security agencies, and Emergency Officers who will be deployed at the various FIFA 2010 stadia. Additional beneficiaries of the other obligations will be identified in the course of the year. This is line with the departments' contribution to government priority on ensuring safety for the public.

The department successfully hosted the national summit on set top box manufacturing, which involved industry players. We will conclude the conformance scheme in the first quarter of this financial year.. A draft roll out plan for the Scheme for Ownership of set top boxes for poor television owning household has been developed. The scheme provides poor people with subsidies that allow them to procure the set top box.

In my maiden budget vote speech I committed the Department of Communications to work closely with key stakeholders to make ICT relevant to the people of South Africa.

The Department has since developed a Stakeholder Engagement Programme that seeks to institutionalize a structured programme of engagement with key stakeholders.

We have created an ICT Industry Forum and have since met twice. This initiative has been met with a lot of enthusiasm by the sector, which regards interaction with DOC as key to the advancement of their interest.

Government can use ICT to improve its efficiency and streamline its operations. Therefore the development of a coherent framework for the deployment and utilization of ICT in government is critical. It is urgent that government adopts and uses ICT in order to modernize services, improve administration and efficiency.

The roll out of effective ICT services will ensure that government services are available to all South Africans equitably irrespective of where they are in the country. South Africans will be able to see a single face of government and be able to connect with all levels of government and different departments using a single platform. ICT offers a possibility of e-Government where government offers a seamless and integrated platform for interaction.

When addressing rural development, ICT can also contribute to the scientific interpretation of outputs in the agricultural sector, water management, including numeracy and literacy training of communities. We are in discussions with the Department of Rural Development and Land Reform to ensure that we participate in the agrarian reform and food security programme through technology intervention in our sector. This will also contribute to our involvement in growing the second economy.

The Department of Communications' main responsibility is ICT policy initiation and development and to oversee the implementation thereof. My department, unlike other line departments, does not have the physical presence at Provincial and Local government levels to implement programmes. We are dependent on partnerships and collaborative arrangements that involve the private sector, all levels of the public sector and NGO's. The State Owned Enterprises (SOE) are the primary instruments through which the DOC implements its programmes.

The SOEs are to develop strong governance procedures and systems. As a result of this, we have amongst other things strengthened the Shareholder Compact between the Minister and the Boards of the SOEs. I am calling for greater institutional capacity building, more effective utilization of the human resource capacity, better financial management and more cohesiveness.

In order to ensure the sustainability of SOEs as part of my government's arsenal to deliver on the Polokwane Resolutions and our election mandate, the department is to set up an effective monitoring system for the SOEs that will address the objectives of providing effective and efficient oversight of SOE's and other entities, and introduce performance management system with the Icasa Councilors.

Since my appointment as Minister of Communications, I have been focusing on improving the capacity of the department to deliver effectively, efficiently and timeously. One of the first actions that that I undertook was the appointment of the Director General in October 2009 as a measure to bring in stability within the organisation. We have been examining our organizational capability with a view to improve performance and enhance the capacity of the department to deliver on the ANC Government's mandate. During this initial period we also had to exercise our authority to institute some disciplinary measures on officials who have transgressed the provision of the PFMA. Currently we have commissioned an organizational review that will focus on systems, processes as well as human resources issues.

South Africa is an integral part of Africa. At the level of ICT integration of policy and systems we will create an environment that is economically beneficial to all the continents' people. In that spirit we hosted the African Union Communications and Information Technology meeting at Ministerial level. The Oliver Tambo Declaration which was adopted at this meeting calls for: the promotion of integration of African ICT policy and systems, sharing of human resources, harmonization of ICT regulations within the continent and sharing of infrastructure where possible, to address accessibility and the cost to communicate.

This culminated in the Addis Ababa Declaration (2010) adopted by the AU Heads of State and Government attended by our President Jacob Zuma. The Summit re-enforced the principle of the Oliver Tambo Declaration (2009) and took a further decision to develop an African Cyber-framework by 2012.

In May 2010 South Africa will participate in the World Telecommunications Development Conference (WTDC). Our focus with regards to this conference will be to enhance the deployment of technologies, advise on financing of the telecommunications and low cost technology options as well as promoting universal access to rural communities.

In October 2010 we will participate in the International Telecommunications Union (ITU) Plenipotentiary in Mexico. We shall strive to ensure that South Africa is globally positioned and that the needs for our developmental agenda are highlighted for the next four years.

Our participation in the ITU is of critical importance. I therefore call upon all ICT role players to actively participate and support the department in all ITU activities.

It is important that we realize that the challenges we face require us to adopt policies that pursue African advancement and enhance international cooperation.

Last year, I pronounced that my department will develop an Integrated ICT Policy Framework which will seek to position ICT as a central enabler for effective service delivery to transform the lives of our people. This comprehensive policy framework will be able to move us towards a people-centered and people driven, inclusive and sustainable digital economy. This framework should also support our endeavors for full convergence as we move towards an information society.

The public consultation towards developing the comprehensive ICT policy framework has begun at various levels, a preliminary discussion paper will be made available to the public for more compressive deliberations and inputs.

We should recognize the critical importance of ICT as a major user of energy and natural resources and as an enabler for environmental and cultural change. We therefore have to do our best to ensure that technology systems that we use to improve our lives do not have a negative effect on the environment that our children and their offspring will inherit. We will be embarking on an ICT greening strategy to reduce the environmental impact of our computer and electronic systems.

The Constitution of the Republic makes provision for the right to freedom of expression. This important right includes the freedom of the press and other media, and the freedom to receive and impart information or ideas. As you know, the majority of our people living in rural and semi-urban areas have little or limited access to information, particularly print media and digital data access.

Our democratic government has passed legislation and policy frameworks to enable the enhancement and the delivery of online services. The Electronic Communications and Transaction Act, provides for the provision of online services and the creation of an e-Commerce environment that is secure and authentic. This Act supports the provision of online services delivered via the internet.

As a government we will continue to implement these policies and encourage strategic investment in ICT backbone infrastructure in provinces and municipalities, especially in rural areas. We will also work closely with the Provincial and Local Government within the co-operative framework espoused through the Intergovernmental Relations Framework Act. In October last year, I hosted the Intergovernmental Relations Forum which was attended by MECs from the nine provinces of our country. The common challenge expressed by most provinces is the unavailability of ICT infrastructure, whilst others indicated that they have began their investments in fibre-optic cable networks.

There is a strong need to integrate our plans to ensure interoperability and accessibility of these networks by individual households. Our people must have maximum return from all these investments that our government is making.

In building of an information society we are guided by the principles of people-centredness and inclusivity. On the 26 of February 2010, we launched an Information Society Multi-stakeholder Forum which is an Information Society Partnership for Development. This initiative is aimed at bringing together all stakeholders in the implementation of our National e-Strategy, the ISAD Plan, to bridge the digital divide. I was excited to see the ICT industry, civil society and labour coming out in support of this initiative. The Department has received a number of proposals for collaboration and we hope that this will yield a positive developmental impact in our society.

In the previous financial year, the Department developed an ICT Small and Medium Enterprise Strategy, which is centred on entrepreneurship principles. The rollout of this strategy will ensure the establishment of ICT Business Incubation centres in Limpopo, Mpumalanga and the Kwa-Zulu provinces.

In an effort to digitize our cultural heritage content, the Department launched the KZN digital repository at Stanger in September last year. The documentary which was unveiled by the Department in collaboration with the Ilembe District Municipality is but one of our success stories of ensuring that heritage content is captured and preserved using youth. The Department has also finalized the digitization and profiling the story of one struggle intellectual, Mr. Thabo Mofutsanyane. The documentary will be launched during the course of this year in a memorial event planned with the Free State Provincial Government and the Thabo Mofutsanyane District Municipality.

The majority of people who are implementing these projects are young and are trained in IT and business development skills. The e-Cadre is a flagship project in which we train young people in collaboration with Further Education Training (FET) colleges and deploy them in various municipalities to perform community service. The 40 young people trained in Ekurhuleni have not been placed due to lack of funding for this project in the previous financial year.

The strategic goal of ensuring universal access to services remains an important component of the work of the Department and the Universal Service and Access Agency of South Africa. USAASA has completed the project of definitions for Universal Services and Universal Access which were published in the Government Gazette in February 2010. The definitions set standards for infrastructure roll out in under serviced areas. These definitions mark the cornerstone and progress in facilitating the bridging of the communications and infrastructure gaps that still exists in our country.

The national youth deployment strategy was developed in the first quarter of 2009. It is focused on developing ICT infrastructure and building access centers. The key highlights for the previous financial year included the establishment of 8 new community centers. Sixty eight schools have been provided with 2720 computers. Subsidies for internet connectivity were granted to 18 FET colleges.

In the next financial year the agency intends to establish a baseline project to identify the number and geographical location of under serviced areas. The agency will also built new digital hubs targeting rural provinces.

Another strategic goal of our government is to strengthen the skill and human resource base in the ICT sector. Our human development is characterized by a lack of employment - ready graduates required by our modern economy especially in the field of ICT.

Following the reconstitution of the e-Skills Council by the department last year, the work of the Council is on track with the National e-Skills Study conducted and a report adopted by the Working Group. The final report is ready for presentation to Cabinet.

The National Electronic Media Institute of South Africa (Nemisa) was established to provide education and training in production and technical skills relevant to TV and radio broadcast industries. Over the next financial year Nemisa will develop capacity to deliver high quality educational services and train 870 learners.

In pursuance of better health and education for all South Africans, our department is cooperating with the departments of Health and Basic Education for the development of a connectivity plan the implementation of which will occur in the course of this financial year.

The year 2010 marks the mid-term of the World Summit on Information Society. In May this year, South Africa will join member countries of the United Nations participating in the global assessment of the progress made in the implementation of the Summit outcomes since their adoption in 2005.

We must always remember our central theme: we should ensure that ICTs are used for accelerated service delivery and empowerment.

Fellow South Africans,

My parting words in this historic year 2010, the Year of Action!

Let us show the world and confound our critics. South Africa can pull it off, on and off the field.
For our part in the ICT sector, the ICT infrastructure for the 2010 FIFA Soccer World Cup and the International Broadcasting Centre will be fully operational before the official kick off date of 11 June 2010.

Mayi Hlome Bafana Bafana Ke Nako!



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