Hon Minister, hon Chairperson and hon members, the Select Committee on Public Enterprises wishes to express its elation at the tabling of the Broadband Infraco Bill.
The Bill allows for the full services network assets of Eskom and Transnet, comprising the national fibre optic network, to be consolidated into a single public entity called Infraco. This intervention has become necessary because telecommunications costs in South Africa are exorbitant in comparison with other countries. These high costs reduce our competitiveness on an economic level and also retard the pace at which the quality of life of our citizens is improved through the deprivation of access to modern communications technology.
When the Department of Public Enterprises conducted investigations into the country's high broadband costs, these studies revealed that the largest connectivity costs are attributable to national broadband connectivity and international connectivity. It is in this area that Infraco will intervene.
By increasing South Africa's broadband capacity and reducing costs at wholesale level, it is expected that South Africa's telephony costs will reduce by 65% within the first year of operation and by 95% after five years of operation. It is the anticipation of this massive cost reduction that informs the elation of the select committee around this Bill.
The economic spin-offs that we envisage are enormous. The services industry is currently experiencing the greatest rate of growth. Business process outsourcing, in particular, has been identified as a priority growth sector for South Africa. ICT is very important for attracting investment, stimulating growth and creating jobs in the services industry and its reduction is therefore welcomed.
For now we welcome the department's decision not to sell the full service network to Neotel. We look forward to Infraco playing a fundamental role in placing South Africa in the top echelons of a knowledge economy and accordingly support the adoption of its establishing legislation. As the select committee we also agreed on this - that we support this Bill and we urge this august House to support the Bill. We wish you all well, the department and the Minister. Thank you. [Applause.]
Debate concluded.
Bill, subject to proposed amendments, agreed to in accordance with section 75 of the Constitution.