• Excerpt from the speech by Dr Z Pallo Jordan at the launch of the White Paper on Telecommunications Policy
• Highlights of the Year
• Review by the Postmaster General
• Communications Policy
• Cellular Telecommunications
• Frequency Management
• Frequency Planning
• Regional Activities: Monitoring and Investigation
• Engineering Support
• Private Radiocommunication
• International Relations
• Report by the Staff Management Board
• Human Resources
• Communication Services
• Financial statements
• Statistical Overview: 1 October 1991 to 31 March 1996

Excerpt from the speech by Dr Z Pallo Jordan at the launch of the White Paper on Telecommunications Policy

Cape Town, 15 March 1996

"Soon after assuming office as Minister, I realised that the present framework governing telecommunications services in South Africa is outdated and in need of amendment to meet the ever-increasing demand and expectations of the telecommunications industry as well as the user community. When I tabled my ministry’s budget in Parliament in June 1994, I made mention of the outdated and superannuated legislation governing telecommunications. At that time, I announced that my ministry would engage in preparations with a view to initiating wide-ranging consultations regarding future telecommunications policy and regulation. I envisaged a consultative process that would be as inclusive as possible to rationalise the statutes governing telecommunications and to optimise the capacity South Africa has acquired in this domain.

What we are unveiling today is the product of that open, transparent and rigorous process to develop the new policy and regulatory framework that will enable the telecommunications sector to contribute maximally to the Reconstruction and Development Programme (RDP).

From the outset we placed two interlocking goals in the forefront of our policy. These are to balance and interconnect the goal of providing basic universal service in telecommunications to the disadvantaged rural and urban communities with the goal of delivering advanced information services capable of meeting the needs of a growing South African economy. It is the fundamental anchorage of our policy that it cannot promote one of these goals without the other. The simultaneous pursuance of growth and development is at the heart of the RDP.

Our policy recognises the centrality of telecommunications to our growing economy and that extension of the telecommunications infrastructure is a crucial component of the Government of National Unity’s strategy to pair development with growth. We are setting our telecommunications industry on the road to full, regulated competition because we recognise that changes in communications technology, trade liberalisation and the globalisation of communications will have a dramatic impact. We shall not adopt the posture of those who resist change. We are rather engaging in the politics of position in which we seek to maximise strategic advantages for South Africa and a growing economy on the southern tip of Africa. This requires us to engage with the global forces of change rather than blindly resisting them.

Such engagement requires interaction with external partners such as the international telecommunications companies and our neighbouring states in SADC. We also need a range of internal partners such as our own telecommunications stakeholders community. It is for this reason that the achievement of consensus at national level is so critical for the success of our policy.

I am persuaded that, in order to engage with the forces of change, we need a South African telecommunications industry that can work together under the twin conditions of universal service and regulated competition to enable our entire industry to position itself successfully at every level - national, regional and global. We equally need an over-arching vision of the telecommunications sector that every stakeholder can identify with, regardless of normal tensions between worker and employer, between operator and supplier and between competitors with each other.

I believe that the policy that we have evolved does provide the basis for such shared vision for our community of telecommunications stakeholders and this is largely because of the period of consultation that we have just concluded. Although a great deal of work was done on telecommunications policy prior to April 1994, amongst others by the National Telecommunications Forum (NTF), the policy formulation process was given a new impetus with my announcement on 27 March 1995 that my ministry would be publishing a Green Paper on Telecommunications Policy.

Work began in earnest in May 1995. The consultative process was intense, often flaring into debate and passionate disputation. But that is how it should be. We do not occupy identical positions. We have differing interests. This is democracy in action. We all participated in the policy that emerged. It belongs to all of us and we must all assume responsibility to make it work in practice. The ministry, for its part, will continue to play a role of consensus building and facilitation.

There are a number of issues that require follow-through over the next few months. The first is the issue of ownership and financing of Telkom.

The second issue that requires follow through is the question of the local equipment supply industry, GATT binding levels and the World Trade Organisation. In the next few months, the Department of Trade and Industry will convene a number of meetings to discuss the matter, and I propose to table the outcome of these meetings at a summit meeting of the telecommunications stakeholders prior to the implementation of any measures.

The third issue pertains to the economic empowerment of the historically disadvantaged South Africans. The White Paper proposes a set of measures regarding such empowerment. I aim in the near future to convene a meeting of stakeholders to discuss how these proposed measures can be implemented in practice.

The fourth issue relates to the position of South Africa’s telecommunications industry within the regional context of Southern Africa. I propose shortly to engage SADC members on this issue and to visit the Southern African Transport and Communications Commission in Mozambique to discuss the issue of regional telecommunications integration and interconnection with Southern Africa.

The fifth issue is that of the passage of the White Paper and Telecommunications Bill through Parliament, the subsequent establishment of the Southern African Telecommunications Regulatory Authority (SATRA) and the Universal Service Agency. With regard to Parliament, I wish to encourage all stakeholders to engage with the portfolio committees on communications to clarify and deepen their understanding of the telecommunications sector and the proposed policy.

We who participated in the shaping of the policy must make sure that any decision or amendment the parliamentarians make to policy or the Bill, is an informed decision. We must build on the solid platform and vision of telecommunications that has emerged from the consultative process. I want to ask all telecommunications stakeholders to take this spirit of consultation and co-operation into Parliament.

With regard to the appointment of SATRA’s Council, I would like all stakeholders to begin thinking about suitable candidates for nomination to SATRA. The White Paper specifies two main criteria for selection - broad representativity of South African society and experience in the telecommunications sector. We need the best people for the Regulator, and I would ask you to consider releasing people for this task. The success of the entire telecommunications policy may well depend on the calibre of people we are able to put forward for the Council of SATRA.

Lastly, the successful implementation of our telecommunications policy will require ongoing consultation with the community of stakeholders and the public at large. We cannot afford to relax and let go of the delicate process of finalising policy and the beginnings of its implementation. I am, therefore, committed to ongoing consultation with the sector and I hope that the National Telecommunications Forum will continue to play its vital consultative role and to make sure that the vision become reality and we can all move forward together".

HIGHLIGHTS OF THE YEAR

FOREWORD

REVIEW BY THE POSTMASTER GENERAL

Telecommunications has become increasingly important and is evolving on an unprecedented scale world wide. This situation requires responsiveness and commitment on a national scale to ensure that the diverse needs in the South African context are met.

The Department of Posts and Telecommunications has an unique role to play towards realising the aspirations and expectations of the people of South Africa. Transformation has been the key word over the last few years and apart from setting the scene for structural change, a Green and White Paper process was launched during the year under review. In this way the most important issues and options could be steered to formulate a broad telecommunications policy for South Africa.

The objective to ensure universal affordable service and from a telecommunications point of view improve the quality of life of all South Africans, requires action-orientated and results-orientated strategy plans. In the short term a legislative and regulatory framework should serve as stepping stone and directive towards meaningful reform. In essence, the process is aimed at a redistribution of homogenous functions, i.e. responsibility for policy on broadcasting, postal services, telecommunications and the radio frequency spectrum to remain with the Department, whilst an independent regulatory authority will be entrusted with the regulatory functions.

In addition to the activities expounded upon in this report, much time has been devoted to the empowerment of those who will be closely linked with policy, regulation and management of communication institutions. The process involved joining forces and sharing a knowledge base with tertiary institutions to initially establish a conceptual understanding of telecommunications. In time to come the focus will shift to equip large numbers of potential employees with suitable qualifications, knowledge and skills to facilitate flexibility and diversity in the work place.

An achievement which can be attributed to the fine leadership of the Minister of Posts, Telecommunications and Broadcasting is the reincorporation of the so-called TBVC territories into Telkom SA Limited and SA Post Office Limited. The task was finalised in the shortest possible time to the satisfaction of all parties concerned.

In conclusion, my sincere appreciation to my predecessor, Advocate Oosthuizen and the Minister, Dr Pallo Jordan for a great job done during the year under review. The Management Board and the staff once again ensured a successful conclusion of our activities for the period 1 April 1995 to 31 March 1996. I have full confidence that the fine spirit that prevailed during my short term of office as departmental head will continue in the year to come.

Andile Ngcaba
POSTMASTER GENERAL

COMMUNICATIONS POLICY

One of the most important and time consuming activities in which this division was involved during this report period, was the drafting and publication of the Green and White Papers on telecommunication policy.

With the establishment of the National Telecommunications Policy Project (NTPP) in March 1995 by Minister Pallo Jordan for the purpose of developing new telecommunications policy and legislation, this division provided the departmental representation on the NTPP Technical Task Team (TTT). An all inclusive process was followed which involved numerous discussions between the TTT and all major stakeholders, both on a one to one basis and via the National Telecommunications Forum (NTF), which resulted in the publishing of the Green Paper in the Government Gazette of 7 July 1995. The closing date for comments on the Green Paper was initially set for 15 September and eventually extended to 30 September. This office participated with other divisions in the Department in the preparation of the most comprehensive submission on the Green Paper.

After the expiry date, the TTT spent the major part of October reviewing and processing the many Green Paper submissions received. A statistical analysis and a narrative report was published. During the second half of November the Department participated in a colloquium held in order to resolve a number of outstanding issues. However, at the colloquium consensus could not be reached on the issues of market structure and ownership of Telkom SA Ltd. The first issue was referred to an eminent persons group established by the Minister from representatives at the colloquium and the second issue was referred directly to Minister Jordan. A final debate of all outstanding issues took place during the February 1996 plenary meeting of the National Telecommunications Forum, whereafter the White Paper was published in the Government Gazette of 15 March 1996.
 

Terminal Equipment  Type-approval and licensing of Telecommunication Line Terminal Equipment (TLTE) showed a constant increase since 1993, as reflected graphically. From an all-time low of only 60 applications in 1993; 152 applications for licensing of TLTE were received during the report period. Applications for Switching Systems increased from 20 in 1993 to 48 in 1995.
Maintenance Organisations  Applications for maintenance organisations (LMOs) also showed a marked increase during the report period, especially in the LMO-2 category. Whereas no LMO-2 category existed prior to 1994, this had increased to 26 applications during the report period.LMO-1 applications increased from 8 in the previous year to 12 in 1995. See graph.

Policy documents and specifications

The envisaged phasing out of the addition of local content as a prerequisite for type approval for switching systems, necessitated a change in approval procedure. New policy documents for the approval for switching systems were compiled and the procedure documents for TLTE updated. Specifications for the cabling of buildings and subscriber's premises were compiled in consultation with Telkom and published. These documents serve mainly as guide documents to architects and civil engineers in the design of building complexes and for LMOs in the cabling of buildings for the provision of telecommunication services.

Revenue

Revenue earned by application and licence fees, and the sale of specifications during this report period totalled R105,995.00, made up as indicated in the chart.

Seminars and courses attended

Two meetings of the Negotiating Group on Basic Telecommunications of the World Trade Organisation were attended in Geneva.

CELLULAR TELECOMMUNICATIONS

Swiftnet licensing

After extensive negotiations between the Minister, the Postmaster General, Telkom and Swiftnet, Swiftnet was awarded the first national wireless data telecommunications licence by the Postmaster General on 25 August 1995. Simultaneously with the award of the licence a National Wireless Data Telecommunication Access Agreement was concluded between the Postmaster General and Telkom. The purpose of this access agreement is to, together with the licence, establish the regulatory environment for wireless data telecommunications networks. This agreement inter alia includes stipulations to ensure that similar wireless data telecommunications operators can be licensed as soon as spectrum is available and that Telkom and each wireless data operator has to conclude a connection agreement which has to be approved by the Postmaster General. Subsequently wireless data operators will be licensed with similar obligations and authorities as Swiftnet and will have to conclude connection agreements with Telkom which must be no less favourable than the connection agreement between Telkom and Swiftnet. The connection agreement between Telkom and the operator sets the terms and conditions that pertain to services provided to the operators by Telkom. The Connection Agreement between Telkom and Swiftnet was concluded on 26 March 1996 and submitted for approval by the Postmaster General.

GSM cellular licence for former Ciskei

In line with the Reconstruction and Development Program goal of the Government to provide telecommunications access to all communities, the Department assisted the former Ciskei Department of Posts and Telecommunications in licensing Vodacom (Pty) Ltd and Mobile Telephone Networks (Pty) Ltd (MTN) to operate GSM networks in the Ciskei area. This was necessary since the interim constitution provides for the legislation of the former TBVC states to apply until specifically repealed and replaced with South African legislation. Legislation reform was only planned for 1 April 1996 and the people of Ciskei have an urgent, immediate need for telecommunications services. Temporary GSM telecommunications and radio licences were issued to MTN and Vodacom on 15 December 1995. This process also contributed towards the earlier start of cellular services in Transkei.

Invitation to submit proposal of telecommunications technologies to be implemented in the 440 to 470 MHz frequency band

In February 1995 an invitation to submit proposals of telecommunications technologies to be implemented in the 440 to 470 MHz frequency band was published in the Government Gazette. This process was initiated to achieve transparency and get industry input into the utilisation of the frequency spectrum that will be vacated when the analogue C450 cellular system closes down by June 1999. Eighteen proposals were received and a discussion document was published on 15 September 1995. Comment on the discussion document was allowed until 1 December 1995. These comments and proposals were used as input for Project SABRE and a final decision on how the vacated spectrum will be utilised will only be made after the SABRE band plan has been finalised.

Community services telephone users survey and performance audit

The National Cellular Telecommunications Licences oblige the cellular operators Vodacom and MTN to install, maintain and operate community service telephones in under-serviced areas of South Africa. By 1 June 1995 MTN had to have 1,000 and Vodacom 2,000 operational community service telephones installed.

Consultants from the Bureau for Market Research (UNISA) were appointed in December 1995 to assist the Department in conducting a user survey on community service telephones. The purpose of the user survey is to establish whether the current community service telephone implementations of the cellular operators meet the needs of the communities they are meant to serve. A questionnaire, to be completed by members of the public in under-serviced areas, was developed and a training course for field officers presented in February 1996. The field officers are responsible for the appointment of field workers and for co-ordinating the work done by field workers in completing the questionnaires in under-serviced areas. The actual survey commenced in April 1996.

Chart of Accounts and Cost Allocation Manual (COA/CAM)

On 30 September 1993, Vodacom and MTN were licensed to operate cellular telecommunications networks in South Africa. The mechanism to regulate the cellular industry and to ensure a level playing field and therefore the long term viability of the sector was created by the two Licences and the Multiparty Implementation Agreement (MPIA).

Paragraph 12.1 of the National Cellular Telecommunications Licence (NCTL) and Paragraph 17.1 of the MPIA place the obligation on the Postmaster General to prescribe a Chart of Accounts and Cost Allocation Manual (COA/CAM).

The COA/CAM project commenced in February 1995 and the Department was assisted by Deloitte & Touche Management Consultants. The project was based on consultation by the Consultants with the Department, Telkom, Vodacom and MTN, although it was not applicable to Telkom at that stage. Extensive negotiations were held with the parties involved to ensure that they take co-ownership of the product.

The COA/CAM consists of a broad framework applicable to all telecommunications operators and a detailed extension specific to the cellular operators. The COA/CAM can therefore easily be extended to include all other telecommunications operators.

The Postmaster General determined the COA/CAM on 30 August 1995. The Department will review the results of the COA/CAM reports to measure the extent to which the cellular licensees:

• applications for tariff increases on products and services and tariff applications on new services are fair and reasonable;
• (their agents, contractors and service providers) may be engaging in anti-competitive practices such as predatory pricing, cross-subsidisation, etc.; and
• are meeting their licence obligations.

The Department has also begun to establish the necessary processes, skills and management capacity to review and analyse the operators’ financial reports on an ongoing basis. Deloitte & Touche assists the Department in the review of the cellular operators’ procedures manuals as well as in the development of a decision making framework (DMF) to be used by the Department. The DMF will provide guidelines for analysing issues which the Department has identified as being of regulatory importance, and guidelines for analysing and interpreting financial information submitted by the operators in accordance with the COA/CAM.

Joint Economic Development Plans (JEDP)

In terms of paragraph 9 of the Joint Economic Development Plans (JEDP) of the cellular operators, the first annual reports were due on or before 1 June 1995 for the period from the Announcement Date (14 February 1993) up to and including 31 March 1995. Both the operators’ reports were submitted and although these reports were not submissions for credit, but only to report on the operators’ progress, it was clear that both operators were ahead of their commitments.

On 16 August 1995, the constituting meeting of the Review Council was held to give the members background on JEDP, to discuss the responsibilities of the Review Council and to discuss the operators’ first annual reports.

Tariff plans

In terms of clause 13 of the NCTL, the Licensees shall not charge any tariffs or fees for the Service and any other services whatsoever until such tariffs and fees have been lodged in writing with the Postmaster General. Several new tariff plans as well as changes to existing tariff plans, including new services, were submitted by both cellular operators during the 1995/96 financial year, a total of 22 submissions.

During June 1995, one year after the start of competition in the cellular industry, both cellular operators submitted tariff plans in terms of clause 13.5. The effect of this clause is that the licensee has a right to increase its tariffs as long as it is less than the year on year increase in the Consumer Price Index for all goods as published by the Department of Statistics. All the increases in these tariff plans were acceptable and were approved.

On 31 January 1994 the Postmaster General defined principles that will be used to assess whether a tariff plan has been increased. Various assumptions had to be made because of the lack of actual traffic information for the cellular networks. It was intended that the principles would be changed when the cellular operator supplied actual information. This would ensure that the assessment by the Postmaster General would be based as closely as possible on the real situation faced by the customer. During June 1995, both the operators supplied the first actual information (i.e. call distribution, average usage and unitisation) to the Department.

FREQUENCY MANAGEMENT

Mission

The day to day mission of this directorate remains the assignment of frequency spectrum to clients in accordance with approved band planning for the country, as well as the type approval of radio equipment. This is always done from the perspective of maximising the efficient use of the national resource that is the frequency spectrum, while harmonising its use to avoid harmful interference.

Routine activities

Well in excess of 5,000 frequency assignments were processed with close to 80 equipment type approvals being completed in this period. A detailed breakdown of these activities in graphic form follows:

 

Extra-ordinary activities

The year under review proved to be action packed with many activities occurring over and above the routine activities of frequency assignment and equipment type approval. These included:

Project Spektrum

Frequency Management, with support from Frequency Planning, gave assistance in the finalisation of the technical modules of Project Spektrum, the development of an automated spectrum management system covering licensing, billing, coverage predictions and interference analysis amongst others. Additionally a start was made in the data capture process required to update the records on the basis of which this system will operate, with much technical assistance offered to the public in regard to their queries on the data capture forms. Internally steps have now been taken to begin the integration process of the system involving various directorates. It is expected that more comprehensive use of the system by some directorates will be possible will occur in late 1996, possibly utilising specific modules with integrated use of the entire system following over a period of time thereafter.

Project SABRE

Frequency Management played a supportive role to Frequency Planning in a new project known as Project SABRE (South African Band Re-planning Exercise) which entailed a detailed audit of the use of the frequency spectrum between 20 MHz and 3 GHz. The intention of the project is the development of a new nationally agreed band plan for this segment of the spectrum, together with a broad migration plan to achieve it over the next 3-5 years. It is expected that once Frequency Planning completes the revised Band Plan and the high level Migration Strategy that Frequency Management, in conjunction with the licensing related directorates, will play a leading role in the implementation of the revised Band Plan via a Detailed Migration Planning process. The Detailed Migration Planning is only expected to come to the fore during 1997.

Policy matters

Policy, and where necessary notices in the Government Gazette, with regard to the introduction of spread spectrum Local Area Network/Wide Area Network equipment were finalised.

A great deal of input to the new policy with regard to the introduction of digital cordless telephony using the DECT standard was also given by this Directorate. The policy awaits final approval by the Postmaster General.

Large input from this Directorate was also made to the process for the revision of policy with regard to existing MPT 1,327 public trunking in the 254 MHz band.

Technical policy inputs were also offered by this directorate in other arenas such as trunking in general, Private Communication Services (PCS) and Mobile Satellite Services (MSS), all of which are under ongoing discussion within the Department.

Conferences

Staff from this directorate played an important role in meetings at the ITU such as the Conference Preparatory Meeting (CPM) for World Radio Conference 95 (WRC-95), the Radio Assembly, WRC-95 itself and later the first CPM for WRC-97 held early in 1996. These conferences were of great importance to the Department and the country as they provided a point of access for the country to once more begin playing a leading role in the ITU environment. The bridge building within the African Group at WRC-95 was particularly heartening. Within the ITU environment there was participation in an ITU Regional Radiocommunications seminar which facilitated broad contact with various neighbouring countries.

FREQUENCY PLANNING

Mission

The mission of the Frequency Planning section is to plan the usage of the frequency spectrum in the most efficient and effective manner possible, in order to

encourage the development of the telecommunications industry, and to benefit all South Africans.

Functions of the frequency planning section

• Identify national and international spectrum requirements and use these to develop and maintain the table of allocations for the country
• Perform regular spectrum reviews
• Provide high quality technical support to the department, the industry and neighbouring countries
• Participate in local, regional and international spectrum management fora.
• Provide technical support for, participate in, and implement the decisions of, ITU radio conferences
• Identify and assist in the development of policy regarding spectrum usage
• promote and improve co-operation with neighbouring countries
• keep abreast of emerging technologies and standards.
• Promote standardisation and the adoption of harmonised standards

The section is currently focusing its energies on the Department’s major spectrum replanning project. This project entails a review of the spectrum between 20 MHz and 3 GHz and is known as project SABRE (South African Band Replanning Exercise).

The radio frequency spectrum is national asset and a scarce resource. Today this resource has a far reaching impact on economies, potential manufacturers and users, and is a vital link in the development of telecommunications in a country.

This exercise therefore aims to ensure that the limited spectrum available is utilised in the best possible manner, in the interest of all South Africans, and consistent with international trends.

The project team consists of the Frequency Planning section of the Department, UK based Smith System Engineering, the Mikomtek division of the CSIR, The UK Radio-communications Agency and NERA (National Economics Research Associates).

Project Program

• Phase 1 Current spectrum use - Consultation phase. Information gathered from interviews, questionnaires, Departmental records, responses to calls for comment, monitoring. To be completed by April 1996.
• Phase 2 Requirements capture -Consultation. Spectrum requirements for the future seen from a user perspective. To be completed by April 1996.
• Phase 3 International trends - investigate international trends in technology, standardisation and spectrum management not only in ITU region 1 but also in ITU regions 2 and 3. To be completed by April 1996.
• Phase 4: Band Plan -
• Draft band plan to be produced by May 1996.
• Launch of the draft band plan - June 1996.
• Consultation and feedback on the draft band plan to take place.
• Final band plan to be produced by October 1996.
• Draft migration plan to be produced by the end of October 1996
• Final migration strategy produced by December 1996

• Tender awarded to Smith System Engineering consortium in November 1995.
• Preparatory work began during November and December 1995.
• Project commenced January 1996.
• Project name chosen - SABRE (South African Band Re-planning Exercise)
• >50 Interviews took place with the industry during January and February 1996.
• Questionnaires sent out to > 300 users and organisations.
• Press releases and adverts were placed in the Sunday Times, Rapport, Communications Week, Engineering News and the Government Gazette to inform everyone of Project SABRE, and invite comment.

• The Project SABRE team to visit the regional offices to inform them and users in the area of the project.
• Meetings to take place with neighbouring countries to discuss the project.
• Remainder of project as per project program

• Maintain an ongoing process of spectrum review.
• Publish a spectrum strategy document.
• Harmonise table of allocations for Southern Africa.

Radio has always been synonymous with science and high technology. The growing demand for radiocommunication services, along with the constant search for improved methods of satisfying it, has transformed the management of the radio spectrum into an increasingly complex field, both technically and administratively. As the radio environment becomes more turbulent the Department, in connection with its responsibilities for issuing licenses, must also ensure that stations comply with the relevant provisions of the Radio Regulations as indicated in the terms of the license. Currently this encompasses the mobile or professional radio spectrum and not the Broadcast Spectrum (according to the Radio Act the Department is also responsible for the management of the Broadcast Spectrum). Radio spectrum users and Departmental relations have always been very close; and if ancestry and history do not bestow sisterhood, they are surely first cousins.

From the above the increased demands by our society on the radio frequency spectrum and the likelihood/possibility of unacceptable interference suffered by some receivers can be seen. To satisfy the ever increasing needs it is thus of paramount importance to control interference among stations and by reduction of the spectrum wasted due to interference.

New equipment, whether imported or locally manufactured, is generally designed to strict specifications for radio interference limits. Improper - i.e. non-approved - equipment is attempted to be prevented from being taken in use by visiting dealers and controlling the sales thereof. Today, the primary limiting factor in the availability and clarity of most radio systems is interference that reduces the effective sensitivity of equipment. The radio user normally experiences his system through his equipment - which in most cases appears to him as a black box with special functions. He or she is ultimately interested in the setting up of a connection with the implicit expectation that the connection will remain undisturbed up to the end of the connection. The real problem lies in many cases with existing equipment, much of it of considerable age and inferior modifications, which does not comply with the requirements. Elimination of interference produced by such equipment, as a result of poor system planning, poor engineering practice and poor maintenance can only be achieved by investigation and measurement in all cases of reported interference. The sources of man made noise and spectrum pollution are virtually unlimited - incidental radiation from electrical devices of all sorts and complex intermodulation products and spurious transmissions from radio communication system are but a few. In practice interference comes in all degrees, from barely perceptible to catastrophic. Emphasis throughout is on reducing all forms of interference to the minimum possible levels and to maximise spectrum usage by so doing.

Complaints are received daily and direct at the MIS (regional office) and a radio inspector investigates. This phase of implementation of spectrum management provides a very important and necessary public service to users. Additional effort is put into improving the utilisation of the radio spectrum as well as locating sources of interference and ensuring corrective action. Inspectors sometimes have to appear in court to carry out functions and to defend the Department’s interests. Such a case recently was thrown out of court three times but determined officials had it re-opened as many times and at the third hearing succeeded in getting a conviction. In addition coastal MIS inspectors perform compulsory examinations of ship stations and other systems are inspected on a spot-check basis as a preventive measure. MIS Radio Surveyors often have to board ships, far off the South African shore, to conduct surveys of radio station equipment relevant to safety and distress. It costs a lot of money these days for a ship to come into the harbour for a survey and consequently MIS officials are often ferried or flown out to these vessels to conduct surveys, sometimes under very dangerous conditions. These and other inspections aid the Department in maintaining an accurate inventory of the types of installation and equipment used at each location. Invaluable feedback from the enforcement section is also provided to the spectrum planning function to assist insight into the adequacy of current equipment standards, the effectiveness of interference prediction models and current frequency assignment procedures.

The year under review proved to be action packed with many activities over and above daily regional tasks. With the implementation of self developed databases the MIS has achieved outstanding results, especially in the collection of outstanding license fees and sealing of apparatus. This was achieved by a combined effort of all staff, technical, administrative and management.

1,406 interference complaints
10,853 sealing files
786 RT examinations
199 marine surveys

ENGINEERING SUPPORT

The WAN Network of the Department

The Department of Posts and Telecommunications became the first Telkom corporate client to make use of a new networking service called Frame Relay. This milestone of the monitoring project was reached approximately in August 1995. Simply put, Frame Relay is a Wide Area Networking (WAN) service supplied by Telkom and can accommodate data speeds of up to 2 Mbt/s with redundant circuitry providing alternate routing to the different Regional offices should a direct link fail. The benefit of the service is that it is now not necessary to use leased lines or dial up modems to connect to other offices in the network.

Although the network originally made provision only for the Radio Monitoring sites, it now incorporates all the Local Area Networks in the Department. Essentially all regions now have access to e-mail, the Spektrum database and the file servers at Head Office. The Department currently uses 64 Kbt/s entries to the Frame Relay network.

Commissioning of the monitoring system

In December 1995, Radio Monitoring finally commissioned the Radio Monitoring Frequency Management System (RMFMS). Rhode and Schwartz, winners of the tender, provided two engineers for this purpose. The RMFMS presently consists of 13 equipment sites including 6 manned sites. The system is designed in such a way that any manned site can control any other site remotely for monitoring purposes. After commissioning the system was fully operational with the exception of the database, the audio system and mapping system. The audio system is locally supplied and required completion of the software development, while the other two systems require work to be completed by Departmental staff. To provide the database with usable data will be a considerable and drawn out process.

Monitoring mobiles

The original requirement of the Radio Monitoring Frequency Management System (RMFMS), called for two mobile vehicles. These vehicles were scheduled for commissioning after the close of the financial year. The mobiles are literally mobile offices on wheels and include the same database, audio and mapping systems as supplied at the manned sites. Furthermore the mobiles have an extended frequency coverage range utilising wider band receivers. The mobiles are totally self sufficient, having an on board diesel generator, back up DC power supplies and air conditioning. It is planned to base one mobile in the north of the country (Johannesburg) and one in the south (Cape Town).

South African Band Re-planning Exercise (Project SABRE)

Monitoring had some input to the above project. The project team requested that occupancy measurements be taken in various centres in the frequency range 20 to 1000 MHz. This was completed over a two week period and the results passed on to the project. The information supplied was compared to existing licence records and formed the basis for the new draft band plan.

Computer support

During the year the post of Manager : Computer Support, was filled and the development of the Computer Support Division could proceed. Proactive planning, realignment of objectives and restructuring commenced. The division was actively involved in the implementation of a sophisticated data capturing system for application and issuing of radio licenses. During the year a Wide Area Network, utilising Frame Relay technology from Telkom, was commissioned. This development established instant computer communication between Head Office, the regional offices and Bureau Beta where mainframe facilities are available. The division is also responsible for project "Spektrum", which is a frequency management and administration system. The administration sub-system was commissioned at the beginning of the year and the technical modules were accepted at the end of the financial year.  

PRIVATE RADIOCOMMUNICATION

In order to modernise and streamline licensing procedures, the new computerised system, named Spektrum, was taken into use and certain types of licences have already been transferred to the database of this system. It is anticipated that overall switch-over will be effected by the end of 1996. This exercise is, however, dependent on the prompt return of the data information forms which were posted to 62,851 existing private radio-communication licensees, of which approximately 10,500 have thus far been returned. Spektrum will, contrary to the existing computerised system which can only be used for the issue of licences, also assign frequencies. The information to be furnished by the licensees is therefore of utmost importance to ensure the completeness and correctness of the client’s details to be transferred to the Spektrum System.

The total number of radio stations licensed and certificates issued compared with that of the previous year are detailed in the table below and reflects an increase of 3.328% against that of the 1994/95 financial year.

  INTERNATIONAL RELATIONS

As a consequence of South Africa’s re-admission as a member of the Universal Postal Union (UPU) and to full participation in activities of the International Telecommunication Union (ITU) late in 1994, attendance of meetings and conferences of these Unions gained momentum during the year under review. Participation in such meetings and conferences could however only be structured on a limited scale due to inadequate human resources. Thus the full benefits of re-admittance to these communication agencies of the United Nations, whose fora adopt decisions and formulate strategies concerning the development of communications for the benefit of all its members, could not be reaped for South Africa and its peoples.

On invitation by the Secretary General of the ITU, members of the Department participated in a Committee which was established to review the rights and obligations of the Union’s membership and to make recommendations concerning wider participation by telecommunication entities in the Union’s activities. The Committee’s recommendations will be considered by the Council of the ITU in order to determine whether amendments would be necessary to the Constitution and Convention of the ITU. Final proposals in this regard will be considered by the ITU’s next Plenipotentiary Conference during 1998.

On its re-admission, South Africa was also elected as a member of the Council of the ITU and of the Council of Administration of the UPU and meetings of these organs of the two Unions were also attended during June and October 1995, respectively. Both Councils are responsible for the functioning of the Unions in the four years between meetings of their highest decision-making organs, namely Plenipotentiary Conference in the case of the ITU and Congress in the case of the UPU. Consequently, their agendas include items on a wide variety of subjects such as personnel matters, the consideration and approval of their biennial budgets - a budgetary method generally followed by United Nations agencies -, developmental assistance in the field of communications to least developed and developing countries and to countries with special problems, agendas and duration of future conferences and meetings, progress measurements of the strategic plans adopted by both Unions during 1994 and other aspects related to the smooth functioning of their respective Secretariats which are situated in Bern (UPU) and Geneva (ITU).

The Department, in co-operation with Telkom SA Ltd, hosted a radiocommunication seminar during September 1995 which was organised by the ITU for English speaking countries in Africa. The seminar lasted a week and was well attended by radiocommunication experts from other countries and from within South Africa. On this occasion an agenda item of the ITU’s World Radiocommunication Conference which was held in Geneva, Switzerland during October of that year, was co-ordinated among members of the Southern African Transport and Communications Commission (SATCC).

The Department, as the South African communications sub-sector co-ordinator for SATCC, participated in co-operation with various communication stakeholders, in protocol development workshops of the Commission and in SATCC Co-ordinating meetings which were held during the year under review.

The Radiocommunication Sector, one of the three sectors of the International Telecommunication Union (ITU), annually holds regional seminars on frequency management to assist Administrations to keep abreast of frequency management, associated regulatory issues and technological developments in radiocommunication. In co-operation with the ITU the Department decided to host such a seminar for some of the countries in the African Regions from 4 to 8 September 1995. The St. George’s Hotel in Midrand was chosen as the venue. This Seminar was intended to mark the re-admission of this Administration to the organisation and to promote and consolidate regional co-operation.

The main objectives of the Seminar were to discuss, amongst other things.

• Frequency management in both the telecommunication and broadcasting bands
• Regulatory and procedural matters
• Preparation for the World Radiocommunication Conference (WRC-95)

The Seminar was instrumental in bringing about a better understanding of the need for regional co-operation and was acclaimed as a success by all who attended. It also served as a means to formulating a regional standpoint for the World Radiocommunication Conference.

International Telecommunications Satellite Organization (INTELSAT)

A Departmental delegation attended the Twentieth Assembly of Parties of INTELSAT held in Copenhagen from 29 August to 1 September 1995. At this meeting the Assembly, the highest governing body of the Organisation, amongst others, decided to give the highest priority to the study of a commercial subsidiary option as a possible new long-term structure for INTELSAT. The new structure is necessary in order to adopt the Organisation to a more competitive market environment. A working party was established to undertake the study and South African representatives, in close collaboration with representatives from other African countries, have participated actively in the work of the working party.

International Mobile Satellite Organization (INMARSAT)

The Eleventh Inmarsat Assembly was held in London from 27 February to 1 March 1996 and was attended by a Departmental delegation. One of the more important decisions taken at this meeting was that there is an urgent need to introduce changes to the Organisation’s structure in order for it to remain commercially viable in a very competitive market. A special working group is undertaking a study and will make recommendations on a suitable new structure for the Organisation, which is planned for implementation in 1997.

REPORT OF THE STAFF MANAGEMENT BOARD

The Staff Management Board reports as follows on matters it dealt with during the period 1 April 1995 to 31 March 1996:

Constitution of the Board

The Board was constituted as follows during the year under review:

Chairperson : Adv P.J.T. Oosthuizen (Postmaster General)

Vice Chairperson : Mr J.H. van Loggerenberg (Senior General Manager)

Members : Messrs

• P.N. Lochner (General Manager)
• D.J.J. de Jongh (Senior Manager)
• J.C. Klok (Senior Manager)

Adv. Oosthuizen’s contract as Postmaster General expired on 31 August 1995. Awaiting the appointment of a new Postmaster General, Mr Van Loggerenberg acted as Postmaster General and Chairperson of the Board.

Mr A.A. Ngcaba was appointed as Postmaster General on 8 January 1996 and took over as Chairperson of the Board with effect from that date. The Board was reconstituted as follows:

Chairperson : Mr. A. A. Ngcaba (Postmaster General)

Vice Chairperson : Mr J.H. van Loggerenberg (Senior General Manager)

Members : Messrs

• P.N. Lochner (General Manager)
• J.C. Klok (General Manager)
• C.D. van der Hoven (General Manager)

Of the 39 case files referred to the Board during the period under review, 15 were subject to approval by the Minister. Two special Board meetings were held during this period. Most of the cases considered by the Board dealt with the acquisition of personnel and recommendations pertaining to service conditions.

Merit Assessment

The Central Merit Committee as constituted by the Board met on 19 September 1995 to consider candidates’ claims to promotion.

Motorcar Scheme for Senior Officers

The Board has authorised, subject to the Ministers approval, that the existing Motorcar Scheme for Senior Officers be replaced by a Motorcar Allowance Scheme for Senior Officers in line with that applicable in the Public Service.

HUMAN RESOURCES

Personnel

Telecommunications has become a very important part of South Africa’s society. Ways and means towards closing the gulf between developed and disadvantaged areas with regard to access to facilities and services, have been the focal point for some time. Technological advancement, the rapid integration of computer technology and a concomitant demand for more sophisticated services by users, require a constant alertness and commitment to meet the challenges over the broad spectrum.

Meeting the diverse demands in the human resource discipline has been debated in many forums and is still considered as one of the more complex issues in the South African context. The involvement of the entire sector in a co-ordinated and committed manner to ensure that South Africa becomes the so-called new hub in the Southern Hemisphere, needs to be propagated in a meaningful manner. This in mind, restructuring of the existing mechanisms of the Department into dynamic entities is no doubt a step in the right direction and should be welcomed as an incentive worthy of support. Experience has shown that a suitably equipped personnel corps is essential to serve as the driving force to develop an equitable resource strategy and in particular ensure that training, skills development, research, etc. are effective. In the absence thereof other efforts will be of little relevance.

With a staff component comprising some 280 officials towards the end of the year under review, the commitment, financially and otherwise, in meeting the demands in a new telecommunications environment, needs no further elucidation. This can be better understood if cognisance is taken of the fact that, apart from policy issues, certain essential telecommunications functions such as Consumer Protection, Satellite Communication, Technical Standards and Industry Relations virtually have to emerge from the surface. As referred to previously, training, development and related uplifted programmes will have to feature strongly as a sure means of reaching our objectives. For this reason much effort has been directed towards at least establishing a basic understanding of communications through various methods of instruction where the need existed. These actions need to be intensified, but the machinery is in motion and the longer term investment will not go unrecorded.

Training and development

Global review

During the year the emphasis was primarily placed on the training needs of the technical staff, which culminated in the formulation of two courses for this group. Firstly an accredited three-year post matric qualification, similar to a training programme provided by City and Guilds of London, was developed. The course will be presented during the ensuing year, subsequent to it having been screened by the to be formed National Qualifications Framework. The other programme comprises a radio course modelled in line with the Amateur Radio League Programme, which has been designed to provide a non-qualified technical personnel with basic information in the radio field.

A training needs analysis for the entire Department was completed and the information processed. The following courses has been developed:

• Principles of Supervision
• Team Building and Situational Leadership
• Communication
• Presentation Skills
• Time Management
• Middle Management
• Literacy/Writing Skills
• Enhanced Language Skills
• Mentor-Protégé Programme
• Project Management

In-service training has met expectations and has created an awareness of its significance. The importance of quality time spent to establish a structured and methodical means of developing subordinates has been widely promoted. These incentives will continue.

The way forward

An understanding of the working and interdependence of the various departmental structures has been promoted where such a need existed. This exercise was amplified by focusing attention on the importance of the individual and his/her role in the organisation. This laid a sound basis for the official to grasp the responsibility individually and collectively towards meeting the many new demands in a re-engineered telecommunications environment. 

COMMUNICATION SERVICES

Mission

The aim of Communication Services is to promote the image of the Department, cultivate sound relations and improve the manner in which information is disseminated, both within the Department as well as to the general public.

Activities

During the period 1 April 1995 to 31 August 1995, the Senior Manager: Communication Services was attached to the Parliamentary Office in Cape Town where she acted as Public Relations Officer for the Postmaster General and the Department. She returned to Pretoria in September 1995, where a small section was started with two staff members. A monthly internal staff newsletter was introduced, and arrangements were made, in collaboration with the National Telecommunications Policy Project and the Ministry, for the National Colloquium on Telecommunications Policy which was held from 20 to 23 November 1995.

At the insistence of this section, management sanctioned the introduction of an Achiever of the Month Award during November 1995. The award takes the form of peer group recognition of excellence, and is intended to give recognition to employees whose exemplary conduct or achievements contribute to improving communication within the Department, promoting the esprit de corps and enhancing the quality of service rendered to the general public.

The regional offices were visited during November and December 1995, and the opportunity was also utilised to distribute promotional material regarding the Green Paper on Telecommunications Policy to non-governmental and non-profitable organisations. Preparations were made for the introduction of a departmental library, but due to financial constraints, these plans had to be shelved until the following financial year. Preparatory meetings for the Information Society and Development (ISAD) Conference, a major international event which was planned for May 1996, were also attended. The activities of the section for the reporting year ended with the launch of the White Paper on Telecommunications Policy in Cape Town on 15 March 1996.

FINANCIAL STATEMENTS

1. Accounting policy

1.1 Accounting basis

The transfer of the running of the telecommunications service and the postal service to the public successor companies Telkom SA Ltd and SA Post Office Ltd with effect from 1 October 1991, reduced the functions of the Department of Posts and Telecommunications to regulatory governmental functions for which provision is made in the Radio Act, 1952 (Act No. 3 of 1952), and the Post Office Act, 1958 (Act No. 44 of 1958). The financial statements have been drawn up in terms of the provisions of the Post Office Act, 1958, according to the historical cost basis and conforms with the basis for the period 1 April 1994 to 31 March 1995. In terms of the provisions of section 12G(3) of the Post Office Act, 1958 (Act No. 44 of 1958) the following expenditure in connection with orders to which the Department is committed and which was incurred, was, as far as possible, booked against voted funds for the 1995/96 financial year :

1. Orders in respect of operating and capital expenditure which were placed before the close of business on 31 March and in respect of which the Department is obliged to perform but for which the goods or services have not yet been received/delivered;
2. Ordered goods received and services rendered for which payment had not been made at the close of the financial year; and
3. Advance payments on a percentage basis according to contract in respect of commitments entered into prior to 31 March for which equipment must be manufactured and delivery and final payment be made upon completion after the close of the financial year.

The accounting policy has been consistently applied in all material respects.

1.2 Income acknowledgement in general

As opposed to the Department’s financial year private radio communication licence fees are levied for a calendar year. The acknowledgement of this income takes place without taking into account the accrual basis and includes all amounts levied during the financial year irrespective of the licence year to which it applies. All other income is brought to account on the cash basis.

1.3 Fixed assets and depreciation

Fixed assets are stated at cost price less accumulated depreciation and are depreciated according to the straight-line method over their estimated useful lives from the financial year that follows the date of commissioning.

Furniture is regarded as operating costs and written off against income in the year of purchase.

1.4 Investments

Investments in shares are shown at the valuation of the shares as at the date of issue.

Telkom SA Ltd and SA Post Office Ltd have, in terms of the provisions of sections 3(4)(a) and 5(1) of the Post Office Act, 1958, each issued to the State 3,899,222,728 and 200,939,821 ordinary shares respectively with a par value of one rand each which have been accounted for under Investments and Loans (See note 5). The shares issued to the State represent the net asset value of the relative enterprises as determined at 30 September 1991 by the then Minister of Transport and of Posts and Telecommunications with the consent of the Minister of Finance.

No provision for tax has been made as the Department is exempted from income tax.

Pension benefits are provided by membership of the Government Service Pension Fund (GSPF). The GSPF is materially underfunded. It is expected that the State will assume responsibility for the underfunded portion of the fund.