Madam Speaker,
Deputy President,
Honourable members,
Distinguished guests.
Colleagues and comrades
I have the privilege and pleasure to rise for the first time in this house to support an Appropriation Bill introduced by the Minister of Finance for the purpose of appropriating funds for the 2000/01 financial year for the Department of Communications.
As we present budgets for the second term of our democracy, I have, by happy coincidence, been placed in the sector in which I had a baptism of fire in 1993, as the chairperson of the SABC board. But you are all witness to the fact that we have survived. Transformation and freeing the airwaves was tackled head on. It was tough. No one had promised us that it was going to be easy.
Today, Madame Speaker, I can only echo the words of the President when he proudly said that, "We are on course; - Steadily, the dark clouds of despair are lifting, giving way to our season of hope."
Building on the foundations which have been laid, and, despite some setbacks that may have caused delays or problems in meeting services as outlined in our mandates and targets, we have achieved much, with very little, in record time.
Vision for the Future
The communications portfolio which covers broadcasting, postal and telecommunications services, is building on the foundation that has been laid and will in time make possible access and participation of every South African in the reshaping of our nation through information and communications technologies and knowledge economy.
Our intention is to improve the life of all our people and make South Africa's future generations a knowledge based society. This will be achieved by establishing a networked information community empowering people to participate in the new economy to change the way people work, live and play and make South Africa globally competitive.
The Challenge
Madame Speaker, this sector is the driver of economic growth today contributing significantly to GDP. Within the context of a policy framework that demands increasing competition, shifting expenditure to infrastructure, mobilising investment and reducing state debt, we have had to explore a wide range of options in corporatisation and privatisation as we restructure state assets. We had to be cautious not to substitute Public Monopoly for Private Monopoly. The imperatives imposed by these contradictory challenges require that we make hard choices and act responsibly. We have to balance delivery of services to ordinary people and to business.
In addition, the Department had to rise to the challenges set out in the national priorities outlined by the President in his speech on the 25th June 1999. These priorities include Integrated Sustainable Rural Development, HIV/AIDS campaign, African Renaissance Project and bringing development and access to government to the majority of the people.
Elimination of subsidy
I am happy to say that Government's policy of reducing state debt and belt tightening and of a better and quality performance of portfolio organisations together with restructuring and privatisation in others has significantly reduced the budget by forty percent to R466, 948 million from the previous financial year.
Postal Services
The Post Office is an institution familiar to most of our people though its accessibility was governed by apartheid planning. Access to its services however is a basic right. Much has been done over the last five years to improve access to a reliable and affordable postal service for the majority of our people, especially those in disadvantaged and rural communities. To ensure this, we are implementing the Postal Services Act of 1998. We appointed the Postal Regulator. One of the key functions of the regulator will be to issue licences to postal service providers. The licence to the South African Post Office Limited has amongst others the following obligations:
· Increasing the number of postal outlets from the current 2 400 to 3 206 by 2003 to both rural and urban areas.
· Roll out of 4 million addresses by 2003. This will increase address points from 8 million to 12 million.
· Setting clear and better customer care targets,
· Improvement in the delivery standards of on-time delivery of basic post from 92% to 96% by 2003.
· Universal access to Internet, e-mail addresses through Public Information Terminals (PIT).
To meet these national obligations as well as challenges of globalisation, a strategic management partner has been engaged and thirty one projects have been attached to their contract. This partner is a joint venture between New Zealand Post and Royal Mail of the UK. Further projects include the building of an international hub in Johannesburg and the establishment of e-commerce related business by the Post Office. The development of the Post Office into a world class company, able to deliver efficient and effective service to its customers and the people of South Africa, has started and is well on course.
Financial performance of the last three financial years has seen a reduction in subsidy from a high of R700 million in 1996/97 to R283 million in 1999/2000 and total elimination of subsidy in the 2000/2001 financial year.
Preparing the necessary human resources for the new tasks is urgent. Exploratory talks with a Canadian institution are underway but we look not only to so-called international best practice but examine whether such best practice is relevant to us. Postbank Restructuring
In the restructuring project of government, the Postbank is being transformed towards providing financial services to the unbanked masses of our country, especially those in rural areas. The Postbank whose major funds are from the poorer majority of our country has not been able to use these resources to improve life and conditions of the rural poor and small and medium enterprises. Restructuring of the Postbank will be done in such a way that the benefits which emanate from it, include new products and credit offerings. It must also improve relations and co-ordination with other government institutions to achieve government objectives. These objectives are the integrated sustainable rural development, urban renewal, and the development of the SMME sector.
The second phase of the restructuring will involve the acquisition of a strategic equity partner and further capitalisation of the bank.
Diversification
The Post Office is investigating the viability of acquiring the productive assets of Fast Forward to further add value to the courier business of the company.
The Post Office will also explore offering consulting services in the SADC region and the Continent.
These restructuring efforts will attract foreign direct investment which will stimulate economic growth.
The Post Office has also begun the application of procurement policy to accommodate SMME's. A number of awards are in the adjudication stage for the maintenance of corporate and regional contracts and sub-contracting at the international mail centre. Expansion to other areas remains an imperative.
Technological changes and advances in types of communication such as e-mail are placing an increasing pressure on traditional forms of communication. To continue to survive in the information age, the South African Post Office is looking at innovative ways to protect its core business and enhance the types of services it provides to its customers. New product developments are being investigated by the Post Office to secure its place in the global information society. Direct mail opportunities in South Africa remains under-explored as do the additional services around mail correspondence in the hybrid mail areas. The South African Post Office is developing electronic commerce initiatives and has plans to give all citizens of South Africa access to free e-mail services.
BROADCASTING SERVICES
The ANC-led government has since 1994 consistently sought to among other things:
· Build a non-racial and integrated single country
· Consolidate our democracy and extend participation by people.
No other sector is poised to contribute to this better than the broadcasting sector. This sector reaches the marginalised and those not empowered - women, youth, disabled, illiterate, rural and landless as well as traditional leaders who play an important role in shaping the development ideology and the knowledge base of those in these areas.
In pursuance of these goals broadcasting can and does make a major contribution to creating a better life for so many of our under-serviced communities. Consequently, based on the broadcasting policy and the Broadcasting Act of 1999 focus has been placed on:
Universal service access
Roll out of community radio station infrastructure;
Promoting local content;
Making Parliament accessible;
Making education accessible;
Meeting the challenges of technological change and globalisation.
Therefore, expanding and upgrading of the infrastructure of the SABC in order for radio and TV under the national broadcaster to reach more people and to achieve our goal of freeing the airwaves to allow access to diversity of views devoid of State propoganda is still being pursued.
Roll-out of community radio stations is determined by the four year licensing process of the IBA. More than 80 community stations have been licenced since 1995. The first four of these stations have already been launched in Botshabelo, Ficksburg, Senekal and QwaQwa, all in the Free State, were successfully launched on the same day in January this year via satellite. By the end of this financial year thirty six (36) community radio stations will have been installed in nine Provinces. My Ministry is contributing by providing infrastructure in needy areas. R6,5 million has been allocated for this programme in the 2000/01 financial year. Priority will be given to the three provinces viz.; Northern Province, Kwazulu-Natal and Eastern Cape which have been identified for the first phase of integrated sustainable rural development.
Not only is this sector important in providing communities with mechanisms to discuss developmental and education issues relevant to them but offers an opportunity of reflecting themselves and connecting with the broader South Africa. To sustain community radio stations the department is establishing production hubs in provinces for programmes that cater for the disadvantaged and marginalised, especially children and people with disabilities. R19,4 million has been budgeted for this programme.
A vibrant broadcasting industry can stimulate economic growth. The regulatory environment that must exist to allow this growth should give certainty, consistency and confidence to the industry. The recent experience with the telecommunications regulator has dented confidence. However, the convergence of the broadcasting, information and telecommunications technologies has forced government to focus on an appropriate regulatory regime and structure.
The merging of the IBA and SATRA is a step in the right direction. The policy, regulatory and operational aspects needs fine-tuning. Hence the integration of the legislation to remove contradictions and facilitate rigorous application of laws is an urgent matter. The merging of the authorities will ensure rationalisation and reduce costs. The parliamentary process that establishes the new regulator needs to ensure a quality of leadership that can give confidence to a rather shaken industry.
The processes for the establishment of two new bodies has started. The one is for a Digital Advisory Council to advise the Minister on technical and economic implications of digitisation. The other is the South African Broadcast Production Advisory Body to advise the Minister on how the development, production and display of local radio and television content can be supported. The budget for this is R1 million.
Two feasibility studies are underway. One into the establishment of a Parliamentary TV Channel. The other into the establishment of a Dedicated Education TV Channel. The budget for both studies is R1 million.
There is a great need for integrated training in broadcasting skills which also caters for transformation. Government has been a catalyst in establishing the National Electronic Media Institute of S.A. to undertake training in the broadcasting and multi-media fields. R12 million has been budgeted for this purpose.
Sentech our signal distributor was converted into a public company with the State as the sole shareholder. This restructuring was taken a step further through a strategic and resource review which is aimed at introducing a strategic equity partner in the near future.
While being involved in the extension of signals to our unserved communities, Sentech is aggressively pursuing clients in other parts of Africa using the opportunity for maintenance of and running infrastructure in Swaziland, Ghana and Kenya.
TELECOMMUNICATIONS
The importance of this sector to economic growth is well established. South Africa ranks 23rd in telecommunications development and 17th in Internet in the World.
The sector is the fastest growing sector here and in the world. It has already transformed financial services and fueled globalisation. However, there is inherent contradictions of the so-called digital divide of the haves and the have nots. The challenge for us is how to effectively bridge the divide - first, the divide in access to services, secondly, the divide in the ownership and thirdly, the divide in knowledge. To transform this key sector of the economy, we need to ensure benefits to large numbers of our people as well as change the racial ownership patterns in both the publicly listed and privately held companies.
To effect the first we accept that it is the states role to create equality.
Today, about 200 villages have access to telephones within a reasonable distance for the first time. The point was driven home when I was stuck with two punctures at night in a village without cellular coverage between Viggiesville and Mnqanduli in the Eastern Cape in January. Less than 50 meters away was a public phone which allowed me access to family, hospital and the police.
Telkom has met and exceeded its roll-out targets - over 1.6 million lines, an impressive 175 458 lines more than the cumulative target. Approximately 14 000 lines have been installed since 1998 to priority customers such as schools, clinics and hospitals.
Telecentre infrastructure rollout is underway but we are reviewing the concept as well as the role of the Universal Service Agency to take account of the integrated rural development strategy and urban renewal. Now that Internet is part of our daily lives, the centres take on a community focus and become the development and business node of rural and urban communities. The recently launched telecentres in Villiers in the Free State and Schweizer Reneke in the North West, the latter for disabled women, speaks to the ability of government to empower and of communities to rise to the challenges of our times.
To effect the second bridge we are transforming the way business is done. Telkom is promoting black economic empowerment through purchasing of services and equipment. More than 371 black suppliers and 351 SMME's and 20 large black suppliers are doing business with Telkom to the value of more than four billion in just under three years. In divesting 10% of Telkom equity government has allowed 3% to black empowerment consortia across all nine provinces.
From the lessons we learned, in restructuring the broadcasting sector, we shall ensure careful shareholder agreements to avoid fronting or "rent-a-black" syndrome. The challenge is immediate in the evaluation of the third cellular licence.
To effect the third, investment in our people is imperative. The role of education from early age to adulthood, as well as innovative training practices in the high tech environment, research and development is a priority. This is reflected in the budgets of all the portfolio organisations.
Humble beginnings at Houwteq have paid dividends in that young people from disadvantaged communities - 60% of whom are female - are now being trained as software engineers and in remote sensing and satellite technologies. Over a hundred have already been absorbed in the economy. The first cohort of students studying remote sensing at Arianne Space Institute in Toulouse France, will soon return to teach at Houwteq.
Telkom alone has set a target of R1,3 billion for knowledge development over a five year period. We will accelerate the development of Web Internet Laboratories in Schools.
Public Emergency
The increase in the budget over the medium term period is mainly for the expenditure on emergency communication. The aim is to create emergency services with a three digit phone number that can be used anywhere, anytime in the country. The study has been completed and will be presented to Cabinet. An initial R7 million has been budgeted for establishment of the Emergency Services Fund.
Other Key Activities
The key activities for the future are the listing of Telkom in 2001, the feasibility study of a domestic satellite, development of electronic commerce and the regulatory regime to govern Internet economy demands well thought out policy and legislation. A Green Paper will be ready soon. To further liberalise the sector, the department is preparing to license a second national operator as a means of introducing competition. Other outputs for the year 2000/01 are the development of spectrum pricing policy, numbering plan, government call centres and a new regulatory framework.
THE GENDER AUDIT
A year ago the Department of Communications' Gender Desk commissioned an audit to determine the level of gender transformation in the portfolio organisations (Telkom, Sentech, SABC, Post Office, SATRA) following the conference "Technology for Women in Business" held in 1998.
This audit could be used to play a central role in the implementation of the national gender programme and determine the priorities of orrganisations as well as examine their practices against which changes can be measured over time.
Across all organisations racial equality is progressing much more rapidly than gender equality. There is a lack of support systems for women in management and a severe shortage of women trained in this area. There is also a belief that no women are skilled in technical jobs. Therefore, the challenge is to find ways to change this culture or mindset.
AFRICAN RENAISSANCE
The promotion of the African Renaissance and the African Century as well as the development of South-South relations is a government priority. This sector is key to the realisation of this noble goal. Each of the portfolio organisations - SABC, SA Post Office, Telkom and Sentech have pursued this goal cognisant of the fact that their own growth and success is inextricably linked to that of the continent.
In cultural and media services, SABC' Africa Channel television is breaking new ground in the development of African perspectives in information and entertainment, in particular in news and current affairs and in the campaign against HIV/AIDS. A process of commercialising Channel Africa Radio and extending its services and programming has started. The station will be restructured and turned into a viable commercial enterprise. R28 million has been budgeted for this purpose.
We confirm that our commitment to the African Connection is beginning to bear fruit. A secretariat has been set up at DBSA and funding of the projects has begun by the World Bank and other institutions under the leadership of South Africa as chair of the Ministerial Oversight Committee. My Ministry has assembled ten African experts and intellectuals in the communications sector to work with us in driving the African Connection Project. Six key African telecommunication projects have been prioritised viz. tele-medicine; tele-health; tele-education; tele-agriculture; infrastructure development; telecentres/Internet access; centres of excellence.
The development of a coordinated policy and regulatory framework at the continental level in the broadcasting, postal and telecoms sectors would make possible the economy of scale to transform the continent into an active and vibrant market. These are pursued through the continental Pan African Postal Union (PAPU), African Telecommunications Union (ATU) and the Telecommunications Regulatory Authorities of Southern Africa (TRASA).
Honourable members, I ask you to help us further along our road by voting to approve this budget, and as we emerge from an intellectual based economy to an information based economy, from traditional ways of doing business to the world of E-commerce. Again, as we move from traditional literacy to digital literacy, we need as South Africans in the age of the Internet economy to be dot.com and dot.za or else we are dot.dead.
In conclusion, I wish to thank the D.G. and the department, all portfolio organisations, and not forgetting my family.
Thank you