Hon members, on Sunday morning the country woke up to the news of the passing on of one of our sons of the soil, television and radio presenter Vuyo Mbuli. On behalf of our Parliament, I want to convey our sincere message of condolence to the family of Mr Mbuli and to the entire staff at the SABC who worked closely with him. Our wish is that his soul will rest in peace. I want to request the House to rise for a moment of silence. May his soul rest in peace!
A moment of silence was observed, all members standing.
Appropriation bill Debate on Vote No 27 - Communications:
Hon Chairperson; hon members of the House; hon Deputy Minister, Ms Stella Ndabeni-Abrahams; chairperson and members of the Portfolio Committee on Communications; chairperson and members of the Select Committee; chairpersons and CEOs of our state-owned enterprises or companies; information and communications technology industry leaders; ladies and gentlemen; my fellow South Africans, good morning to everyone.
It would be remiss of me to begin without paying tribute to a great South African. Let us take once more a moment of silence to honour the memory of the South African Broadcasting Corporation veteran presenter Vuyo Mbuli. There are few South Africans whose lives he has not touched with his positivity, professionalism and passion for his craft. His untimely passing is a reminder that we have many wonderful gems within our state institutions whose presence we take for granted. Let us remember him and many others who make our country the truly great nation it is.
Over 200 years ago the industrial revolution changed the way people lived and worked. Today we find ourselves in the midst of an ICT revolution that is similarly changing the very fabric of our society. The way we work, communicate and live has radically changed in the last two decades. This transformation of our society, our economy and even our political life requires that we rise to these new challenges. I am pleased to say that the Department of Communications is leading the way and is geared for the future. In May it is opportune that we account to our citizens and outline our developmental plans. This is the same month that saw South Africa's first democratic leader and former President Nelson Mandela take office. We wish Tata Madiba well during this time. During the month of May we also acknowledge the role that had been played by the workers in the struggle to achieve a better life for all in our country. I am glad to note that our union representatives have joined us in the gallery this morning.
We celebrated this year's World Telecommunications Day in collaboration with the Department of Transport at a successful event held in Richards Bay on 17 May 2013. This year's theme was: "ICT and improving road safety". My message to you is: "Don't text while driving, and even women must not multitask."
In his state of the nation address President Jacob Zuma stated that:
As South Africans, we should continue to have one primary goal - to make our country a truly great and prosperous nation.
Our vision of building a South Africa in which all South Africans have access to and the skills to use ICT services is essential to achieving this goal of building a prosperous nation. The theme for this year's budget vote is: "Connecting South Africans". In line with this theme, we are focusing on improving the ICT skills base of South Africans, especially of our youth. Yesterday I launched the combined new institution which brings together the Institute for Satellite and Software Applications, the former e-Skills Institute and the National Electronic Media Institute of South Africa, Nemisa, as one body and I am happy with the progress made towards the establishment of this new ICT training institution. Our forward-thinking government policy has created an environment in which both business and people in the ICT sector have been able to thrive. However, the 21st century brings new challenges and we are entrusted with ensuring that our people are able to prosper through ICT in this modern and ever-changing era.
Over the past 19 years this government has worked very hard to reverse the triple challenge of poverty, unemployment and inequality. Today many South Africans have access to postal services within reasonable distances from their homes. In the 12 months to March 2013, the South African Post Office opened 50 new post offices. Most of these offices are in rural areas such as Kayedwa in Bushbuckridge in Mpumalanga, Nywarha in Idutywa in the Eastern Cape, Emoyeni in Dannhauser in KwaZulu-Natal, Spoegsrivier in Kammiesberg in the Northern Cape, Vahlavi in the Greater Giyani region in Limpopo and Ruitersbos in Mossel Bay in the Western Cape.
These new postal branches have been complemented by rolling out mobile branches to ensure that many South Africans have access to these key services. Post offices have become key service delivery centres offering South Africans a convenient place to accept and deliver cash-on-delivery items, a very important service in rural communities where some people shop from catalogues. More than a million South Africans walk through the doors of post offices near where they live to access their social grants.
Post offices now also offer services that enable South Africans to renew their vehicle registrations and pay their municipal accounts and television licences. In the past financial year the SA Post Office was responsible for allocating 1,2 million addresses, mainly to those in rural areas.
After many years of living on the margins of society, over the past four years we have installed 104 low-power transmitters which ensured that 1,5 million more people enjoyed their basic human right of access to information. Of these transmitters, 18 were rolled out in the 2012-13 financial year. The SABC now reaches 94% of all South Africans in the country. [Applause.]
The department's strategic plan prioritises the ICT Policy Review, broadband and digital migration. In line with the National Development Plan, the department has embarked on a process of overhauling existing policies. We convened a successful policy colloquium that led to the establishment of the ICT Policy Review Panel. The composition of the ICT Policy Review Panel reflects the government's mantra of "working together, we can do more".
We plan to deliver the White Paper on ICT Policy next year. On 25 April 2013 we launched the ICT Policy Framing Paper. In December 2012 we launched the Strategic Integrated Project, SIP, 15, which is focused on increasing access to ICT services through the roll-out of broadband infrastructure and digital terrestrial television, DTT. There has been commendable progress in the work of SIP 15. As Chairperson of SIP 15, I am finalising a project action plan which indicates targets for the connectivity of public facilities such as schools, health centres, government offices, libraries and police stations. Whilst we acknowledge the investment of the private sector, we further urge the sector to continue working with us, within the SIP, in expanding broadband infrastructure throughout the country.
Telkom remains the integral part to the state's broadband ambitions of modernising and investing in its long-distance backbone network. Earlier this month we closed the public consultation phase of the New Broadband Policy. We are preparing to take this policy to Cabinet in June 2013. The finalisation of this policy will pave the way for the Independent Communications Authority of South Africa, Icasa, to license the much sought- after 2.6 gigahertz and 800 megahertz spectrum, including the extended digital dividend. By doing this, we will be increasing network capacity, improving coverage, promoting competition and facilitating black economic empowerment.
Let me remind the house that our Radio Frequency Spectrum Policy, adopted in 2010, encourages the efficient use of spectrum resources by employing technologies that use spectrum more efficiently.
In the course of the year we shall be introducing four legislative amendments. The Independent Communications Authority of South Africa Amendment Bill deals with the definition of broadband and empowers Icasa to enforce compliance and monitor radio frequency spectrum resources and postal regulation.
The Electronic Communications Amendment Bill seeks to enhance competition and private investment in the sector and to ensure that there is effective regulation where market failure is apparent. Regarding postal regulation, we shall conclude the South African Post Office Amendment Bill this year. The Postbank Bill will also be introduced in order to align it to the Banks Act.
With regard to DTT, we are happy to announce that the digital broadcasting network currently reaches more than 80% of the population in South Africa. We have also finalised the subsidy plan for poor households supported by the qualifying criteria. We are ready to implement the set-top box, STB, manufacturing strategy, which requires 30% local content as part of the electronic industry development.
Icasa has finalised the broadcasting regulations. I will shortly be releasing a notice in the Government Gazette setting the performance period for the digital migration switch-on. In June 2013 we shall launch the STB compliance lab in partnership with the Department of Trade and Industry and the SA Bureau of Standards, SABS.
We have taken a decision to review the policy on the set-top box control system as one way of fast-tracking the roll-out of digital terrestrial television to make this system nonmandatory. The DTT transmission network roll-out target of 84% population coverage via terrestrial transmitters will be reached by December 2013. Sensor Technology, Sentech, will also launch a direct-to-home satellite broadcasting service later this year. This service will provide TV and radio coverage to the Square Kilometre Array, SKA, and all other areas where there is no DTT signal. With regard to DTT awareness, we shall intensify the implementation of our communications campaigns to inform and educate the public about the need for DTT.
Regarding cost to communicate, we want to remain firm to our commitment of lowering the cost to communicate in pursuance of affordable prices for mobile, fixed and broadband services. The lowering of the mobile termination rates, MTR, from R1,25 a minute in 2010 to R0,40 from March this year represents a significant milestone in reducing the cost to communicate. [Applause.]
I intend to issue a policy directive to Icasa shortly on the transparent pricing of services such as short message service, SMS, voice, and data, to ensure market pricing transparency for the benefit of our consumers. This policy measure will also ensure that competition is strengthened in the telecommunications market. We want to make sure that we get rid of the anticompetitive behaviour and facilitate sustainable competition.
As part of our efforts to increase competition in the broadcasting area, I intend issuing a policy directive in the second quarter of 2013-14 to Icasa to issue a regulation on market definition for wholesale access to premium TV content in order to address market competition. In the midst of redefining our broadcasting landscape, 2013 marks the 20th anniversary of community broadcasting. The department will embark on numerous activities to celebrate this milestone in bringing services to the people. The hon Deputy Minister will give more details on what we plan to do in order to enhance and strengthen community broadcasting.
Having a stable and capable leadership team that has integrity is crucial in our endeavour to improve the service delivery goals of our department and our portfolio of state-owned companies. A stable leadership is crucial to achieving good corporate governance and accountability. Guided by this desire to improve accountability, we have embarked on a partnership with the Auditor-General to achieve a clean audit by the department and its state-owned companies by 2014. We have appointed critical skills that will improve our ability to deliver quality services to our fellow South Africans in order to strengthen the leadership capacity within the department. Our efforts are evidenced by the halving of the vacancy rate from 24% in 2012 to 12,5% this year.
Regarding state-owned companies, in 2013 we shall transfer R1,5 billion, or 76% of our budget, to them in our portfolio. The social return on the state- owned enterprises, and their investment, has been largely positive. The stability of executive leadership that we introduced in our SOCs has helped to solidify the turnaround of these entities. Our proudest achievement in the oversight of SOCs is being able to ensure greater alignment of SOEs' strategic goals to the department's priorities.
Regarding the SABC, the public broadcaster has accelerated the repayment of its government-guaranteed loan while continuing to bring events of national importance to the homes of all South Africans. The SABC plans to pay the outstanding balance of R222 million within four months. The SABC can immediately migrate the three existing channels to the DTT platform and launch additional channels in due course. We are concerned about governance arrangements at the SABC. In this regard I will be consulting with the Portfolio Committee on Communications to explore an urgent review and amendments to the Broadcasting Act.
I am happy to report to this House that Sentech is in a healthy state, not only in terms of service delivery imperatives, but also financially. This can be attributed to the turnaround efforts that we have put in place since 2009.
The Universal Service and Access Agency of South Africa, Usaasa, is back on its feet following a series of governance challenges that led to the appointment of a new board. We have brought about stability at the agency and it is now focused on delivering on its mandate. In the previous financial year, Usaasa connected 55 ICT centres and revamped another 80 centres.
The illegal strike at the SAPO disrupted the lives of many South Africans. Many did not receive their letters and parcels for a long time. Others could not access their municipal bills, invoices and educational material. We take this opportunity unreservedly to apologise to all South Africans. Let me hasten to assure South Africans that we have learnt valuable lessons from this unfortunate experience. We are putting systems in place to ensure that we never go down this road again.
Over the course of the year, the South African Post Office finalised the installation of the coupon distribution system that will ensure that deserving South Africans receive the state-sponsored set-top boxes. This financial year the South African Post Office has also committed itself to building 20 new branches, 25 retail postal agencies and deploying five mobile post offices to serve rural and remote locations.
We are closely monitoring Icasa to ensure that it is able to perform its key role as a regulator. Part of this exercise will include strengthening governance measures and making sure that the regulator is able to efficiently collect and account for revenues that are due to it.
Regarding job creation, we continue to monitor sector-wide job creation in line with the National Development Plan. The ICT sector has created more than 37 000 jobs since 2010. It also contributes an estimated 8% to the national economy.
The international branch of the department continues to be the primary vehicle through which we pursue government's priority of contributing to a better South Africa and a better and safer Africa in a better world. Our leadership role has been well recognised internationally. For the first time South Africa was elected to the Council of Administration of the Universal Postal Union, UPU, and now chairs its Future Strategy Committee. [Applause.] We were also re-elected to the Postal Operations Council that deals with the operational, economic and commercial aspects of the postal business.
South Africa also made an important contribution to the Addressing the World ministerial debate. This led to Ministers adopting the White Paper in support of the UPU's global declaration to prioritise the development of addressing infrastructure. South Africa has contributed significantly to the work of the Universal Postal Union on the development of national address systems. Our use, as South Africa, of the Global Positioning System, GPS, to allocate addresses to people in rural and undeveloped areas proved critical to this.
The department is fully focused on consolidating the transformation of the ICT sector while extending ICT services to all South Africans. We rely on the hard work of the department's executive leadership and the entire team of the Department of Communications to deliver on our mandate.
I want to convey my thanks to the Deputy Minister. My heartfelt appreciation goes to you, my sister; thanks for your support throughout the year. [Applause.] To the chairperson and members of the Portfolio Committee on Communications, thank you for your guidance and input. [Applause.] To the chairpersons and CEOs of the public entities reporting to the department and leaders of the ICT industry who have once again demonstrated their patriotism by tirelessly working with us, I thank you profusely for your time and efforts. [Applause.]
Allow me to thank Team Department of Communications for the work they have done. As I encourage you to pat yourselves on the back, be reminded that our task is not complete yet. We need to achieve the goals and targets that we set for ourselves, some of which were outlined in this speech. I invite hon members to approve Budget Vote No 27 of the Department of Communications. I thank you, Chair. [Applause.]
Chairperson, I would like to rise on a point of order. During the speech of the Minister of Communications, one of the members in the opposition benches was using his cellphone, and I think he wanted to take photographs. I would like it to be checked, because it is against the Rules of the National Assembly for members to use their cellphones to take photographs in the House. Thank you.
Hon member, can you indicate which member you are referring to?
Chairperson, I just want to place on record that it was not the IFP. [Laughter.] [Applause.]
Chairperson, it's certainly the member over there, who is standing now.
Chairperson, I would gladly delete the photographs if it would make the member happy. But it really does promote the career of the Minister if she is photographed. [Laughter.] [Applause.]
Hon member, photographs are not allowed in the House. [Interjections.] The Whip of the party is attending to the matter. [Interjections.] Yes, no more photographs. Thank you very much for that.
Hon Chairperson; hon Minister, Dina Pule; hon Deputy Minister, hon Stella Ndabeni-Abrahams; hon members; distinguished guests; ladies and gentlemen, the ANC-led government has implemented quite a number of strategies and tactics to address various shortages of skills. These include, amongst others, the Joint Initiative on Priority Skills Acquisition, Jipsa; Technology and Human Resources for Industry Programme, Thrip; the Sector Education and Training Authority, Seta; and the Innovation Fund.
Technology is a moving aspect of innovation and it brings a lot of opportunities, especially when tapped in the minds of young people. The ANC 53rd conference re-affirmed the fact that there is a widespread agreement on the importance of information and communications technology, ICT, in building equitable prosperity and a global competitive economy.
However, the effective use of this technology requires building new capacities and skills, referred to here as e-skills, not only in short supply all over the developing world, but also of particular concern in South Africa. The conference acknowledged that South Africa has characteristics of both an advanced and a developing economy. It has access to technology, sophisticated institutions, including research entities and universities, and a strong private sector and fiscal resources.
Locally, e-skills are seen as vital in addressing poverty, achieving sustainable livelihoods, assisting the fight against crime, building cohesive communities and international co-operation, and building a developmental state. This general lack of e-skills is seen by the Department of Communications as a serious impediment to the nation in meeting its commitment to the Millennium Development Goals, the World Summit on Information Society Goals, the New Partnership for Africa's Development, and the South African Medium-Term Strategic Framework.
It is against this background that the ANC's 53rd national conference resolved to promote and support the development of new ICT research and development plans and strengthen existing strategies and policies to foster robust, well co-ordinated institutional arrangements that need the development of indigenous world class technology innovation in ICT through a directed national ICT research development and innovation programme. It is exciting to note that the department has identified e-skills development and ICT research as one of its top key priorities. As far as e-skills are concerned, let me quote from the department's strategic plan for 2013 to 2018:
In order to address the current e-Skills gaps in the country in the short term, the department will prioritise the establishment of a single integrated entity for e-Skills through the collaboration of e-Skills Institute, the National Electronic Media Institute of South Africa, Nemisa, and the Information Systems Security Association, Issa. Over the short to medium term, the newly established single integrated entity for e-Skills will focus on the development of the national e-Skills plan and will implement a range of e-Skills initiatives aimed at increasing the e- Skills capacity across government, business, education, civil society and organised labour.
This is in essence giving effect to the ANC's policy resolution that government must introduce a comprehensive e-skills development plan that will include incentives for mobile industry co-operation for the benefit of the young people. The ANC acknowledges the roll-out of the skills for the school connectivity project. This programme gives the kids tools to enhance their natural brightness through information technology.
With regard to ICT research, I quote:
Programme 3 of the department, Policy, Research and Capacity Development, will have a specific research focus which will entail the development and implementation of a focused research programme, aimed at supporting priority policies. Attention will be given WSIS thematic areas aligned to government priorities, publishing of revised e-Barometer indicators, as well as ITU-D guidelines on Green ICTs.
Good corporate governance remains a very critical area, which continuously requires attention in order to ensure that the department and its entities conduct business in compliance with the various legislative prescripts and regulations.
The key areas at the centre of governance include, but are not limited to, the following: leadership, that means fully constituted votes and executive management; compliance with the Public Finance Management Act and other relevant legislative prescripts; effective governance structures, that is audit and risk committees' management; effective internal controls; and organisational policies.
In the past two years the Department of Communications and its entities have performed as follows: The department received an unqualified audit report; the South African Broadcasting Corporation, SABC, obtained a qualified audit report; Nemisa obtained an unqualified audit report; Sentech obtained an unqualified audit report; Icasa obtained a qualified audit report; the SA Post Office, Sapo, received an unqualified audit report; and the .za domain received an unqualified audit report. [Applause.]
Key issues that have recurred and led to qualifications and emphasis on matters across the portfolio are mainly: a high vacancy rate at the leadership level; inadequacy of proper procedures and systems; noncompliance; irregular, fruitless and wasteful expenditure; weak internal controls; management not doing adequate first level of assurance; and weak internal audit units.
As the Minister has said, the SABC has had its ups and downs, as we are all well aware that we currently have an interim board. [Interjections.] However, let me take this opportunity to commend the members of staff in the organisation at large. Under these difficult circumstances they remained committed to maintaining the public broadcaster's status as a broadcaster of choice.
We note the following progress, for instance. There were fires at the studios that caused major disruptions to operations, but scheduling managed to avoid programme disruptions. During Madiba Month a number of activities were managed and executed; Heritage Month activities were successfully executed; impairments have been managed downwards and the current forecast is R5 million; content policy has been incorporated into the broader SABC procurement policy; and the digital terrestrial television, the DTT, business plan is complete and ready for submission.
I now come to governance matters. According to the ICT Africa analysis studies conducted by Dr Alison Gilward and various literature reviews, the South African telecoms sector has been in flux over the last decade from a policy and regulatory perspective. Suboptimal outcomes after the first phase of reform saw partial privatisation of the incumbent and the entry of a third mobile operator.
Historically, the focus by government on the high cost of communications has failed to acknowledge this as an outcome of its policies, instead highlighting the excesses of network operators and the need to bring political and moral pressure to bear on them. What the sector performance review does is to reveal the links between policy, regulation and market outcomes.
South Africa has had no major policy review of telecommunications since the 1990s, when it embarked on a major consultative process that resulted in a White Paper on Telecommunications and the subsequent Telecommunications Act. This resulted in the partial privatisation of the incumbent, Telkom, in 1997, and the introduction of a third mobile operator after a protracted and highly contested licence processing in 2002.
Therefore, the Minister of Communications must be complimented on the appointment of the ICT review panel. The appointment of the ICT review panel is the beginning of a brand-new future. The key issues that will be looked into will range from constitutional rights to institutional rearrangement. We commend you, Minister, for this initiative. [Applause.]
I now turn to competition. Despite the attempt at creating a horizontal licensing market framework without a fundamental shift in policy, the market remains structured around vertically integrated incumbent operators, with effective duopolies in both the fixed and mobile markets, and despite the entrance of a very marginal third mobile operator in 2002.
Policy and regulation influence the nature of competition and the ability of companies to compete. Minister, it is commendable that you are issuing a policy directive instructing Icasa to take action on this matter. We cannot afford any market failure in this country. We cannot allow the failure experienced by the underserved areas licensees to happen again. I am quoting our former President Nelson Mandela, when he said "never again".
The regulatory framework is currently uncertain in a number of respects. Many of the regulations and other secondary legislation required to fulfil the implementation of the Electronic Communications Act are still pending or not yet proposed. In line with the provisions of the Act, Icasa has instituted a number of processes that have either stalled or not reached conclusion within the statutory period prescribed due to complexity, contradictions with the law or the absence of technical or administrative capabilities. We urge Icasa to take action and move forward. This cannot be allowed. The ANC is not happy about the delays.
South African consumers have long been subjected to some of the highest mobile interconnection rates in the world. Despite having already been in the business for over a decade, with the entry of the third mobile competitor in sight the incumbent mobile operators increased their asymmetrical mobile termination rates from 20 cents to R1,25, an increase of over 500%, while the fixed termination rate was set at 27 cents. This must change. Both the Minister and the ANC have spoken about this. We cannot allow high costs to hamstring communications in this country. [Applause.]
As a result of the parliamentary portfolio committee's intervention to bring down the costs of interconnections, Icasa laid out a schedule to issue interconnection regulations by June through the Electronic Communications Act, chapter 10, "market definitions" and the dominance assessment process. Its failure to issue any regulations in over 18 months and the continued reduction of qualified competition staff suggests that this is going to be a tough deadline to meet.
Recommendations for resolving the key issues in order to foster competition are as follows: We need to develop a common vision for the sector through the development of a clear policy framework to promote competition in the market; and we need to develop co-ordination of state enterprises and the targeted universal service strategy to deal not only with the gaps in the market, but also to demand side stimulation of the market that is in line with the ANC's Mangaung resolution.
We need to create a strong and autonomous institutional arrangement with adequate resources and capacity that will enable the effective regulation of dominant players in the market and anticompetitive behaviour; we need to streamline a policy and regulatory processes to prevent regulatory bottlenecks and to attract internal investors; we have to examine the equitability of licence costs and their rights; we should complete the competitive entry regulation such as carrier pre-select, essential facilities regulation and local loop unbundling; and we need to revise wholesale regulations, including clarifying interconnect glide path regulations.
We in the ANC, the majority party in this House, regard communications as a strategic tool to speed up service delivery.
It is our considered view that the Department of Communications needs a management that is prudent and understands good corporate governance for it to fully achieve its mandate. The successful implementation of all these will result in the department meeting its objectives. The ANC supports this Budget Vote. Thank you. [Applause.]
Chairperson, hon colleagues, if the Department of Communications was closed down, would South Africa's information and communications technology sector miss it? [Interjections.] What difference would its disappearance make to the way South Africa functions? These questions were asked of the department's leadership during the Communications portfolio committee's recent interactions with it. The questions went unanswered.
One of the tragedies of South Africa's fledgling democracy is that it has been so thoroughly undermined by government departments that are critical to the liberation of our people. Education and Communications are two of these. The Department of Communications has, during the past 20 years, failed to grasp that its core role should be to develop policy and regulate an information and communications ecosystem. This ecosystem would enable citizens to use technology to overcome generations of oppression and disadvantage so they can prosper.
The department has taken a few tentative steps to liberalise the market and bring in competition. The half-hearted liberalisation of fixed-line infrastructure through the privatisation of Telkom was a start, but then government hobbled this by holding the majority of its shares. The folly of this was proved last year when the hon Minister pulled the plug on Telkom's turnaround deal with the Korea Telecom Corporation. This was then compounded by her nave interference in the company's annual general meeting, a move that jeopardised its corporate governance. It has yet to recover and produce a coherent strategy that is better than the one the Minister destroyed.
Government must sell its stake in Telkom. Telkom must become a willing collaborator in a wholesale infrastructure consortium that forms the backbone of a ubiquitous, high-speed, affordable, robust communications ecosystem.
The department lacks the appropriate skills to be the custodian of the ICT environment that sparks opportunities for economic growth and global competitiveness. Who can take seriously the strategists who place broadband as their top priority of the year and then ranked the availability of the radio spectrum at number 8? You cannot have the one without the other. This indicates a serious lack of appropriate skills and understanding at the very top of the department.
Its finances have been a mess for years and it fails to achieve most of its targets. The programmes and entities it oversees also fail to meet their targets. Few deadlines are ever met. A few pointers from Parliament's research unit for the Finance and Public Accounts Cluster that landed on our desks last week state this, and I quote:
Over the five-year period until the fiscal year 2011, the Department of Communications and the Department of Public Works were two of the lowest- spending departments. The worst perpetrators of fiscal dumping include the Department of International Relations and Co-operation and the Department of Communications. The Department of Communications emerged as the worst-spending department, at only 66,8%.
This negligence to do the job properly starts at the top. The hon Minister neglects her obligations in respect of parliamentary oversight. At the end of last year, she left 28 parliamentary questions unanswered - the second highest tally of all the Ministries, and so far this year's performance does not look much better.
Now, there are those who will say the hon Minister has been in this post for only one and a half years and that she needs to be given time to turn around the damage of her predecessors. Perhaps that is true, but let us look at what the Minister has achieved so far.
She initiated an ICT policy review process that was long overdue. However, it took a year to be assembled and, with acknowledgement to the panel that met for the first time at the end of January, produced its policy framing paper for comment. I am concerned that, instead of instigating a positive disruption that would release creativity about the ICT ecosystem, the panel is split into conventional silos that could steer them in a direction that serves political rather than national needs. The department has rushed out six new pieces of legislation, four of which the Minister mentioned. Of particular concern is the Independent Communications Authority of South Africa Amendment Bill that emasculates this Chapter 9 regulator by vesting much of its powers in a proposed Spectrum Management Agency. This promises to be another bureaucracy for cronies in search of inflated salaries and tenders to manipulate.
Do the hard stuff, hon Minister. Fix Icasa. Give it the money and skilled resources it needs to do its job properly, and resolve the policy development conflicts. Put nontechnical legislative changes on hold until the policy review is completed.
Then there is the ICT indaba, famous for all the wrong reasons. The outcome of this indaba is one of my many unanswered parliamentary questions loitering in the Minister's in-tray. In March I asked for details on the progress of the task team formed to implement the indaba's resolutions. The Minister is silent only on these matters of substance.
Next, there is the matter of the Minister's unlawful action to unilaterally switch the responsibility for the set-top box control system from free-to- air broadcasters to Sentech, clearing the way for the Minister's preferred supplier, Nagravision, to implement the control system. E.tv's rightful legal challenge took eight months and stalled the digital migration process. Now the hon Minister bewails e.tv's legal challenge as the cause of the delay in rolling out digital terrestrial television, DTT. How delusional is this? You may believe your spin, hon Minister, but the rest of the nation does not. You cannot duck your negative impact on this process.
Another question not yet answered by the Minister is this: What was the legal cost to defend itself against e.tv? The portfolio committee was told by Sentech and departmental officials that the legal bill for this ministerial whim is about R1,4 million. Sentech's bill alone was R798 000 and the department's is R579 000, and rising. Why is the Minister too embarrassed to answer the question herself?
This brings us to the SABC, whose legacy of inappropriate and possibly illegal appointments to executive management will cripple this organisation for many more years to come. One of the reasons the ANC deployees on the previous board were told to resign may well be because they were far too diligent in evaluating the bids for the set-top box access control system.
At one of her last meetings with the previous board, the Minister instructed it to accept the Nagravision bid. Why? Is it because Nagravision and its local agent, African Union Communications, submitted a bid that was R47 million more expensive than the two other bids on the table? Who, Minister, stand to profit from your influence? [Interjections.] By the way, whatever happened to broadband, local loop unbundling and spectrum allocation? These are the critical issues that South Africa needs unlocked so it can become a globally competitive economic powerhouse - and the department shows no urgency in driving them. National Treasury has put a hold on funding broadband until the department comes up with a coherent, acceptable policy and plan to implement it. Another draft broadband policy was recently put out for public comment - but it was a lukewarm effort, and is overshadowed by the National Development Plan's chapter on ICT which, incidentally, had little input from the department.
This brings me to the issue of the allocation of much sought-after spectrum. An audit of what spectrum is available and is being used has been done and is being kept under wraps. Why? There must be transparency on what is a national resource so we can see what is being used and how much is available before it is priced and released to the market. If there is secrecy, we stand a real risk of paying too much for access to a resource that may not be scarce at all. With regard to local loop unbundling, which would bring down the cost of fixed-line access and increase demand for fixed broadband services, there are regulations being drafted for comment, but again, urgency is lacking, and the deadline for these is set for next March.
While all this prevarication is going on, South Africa is slipping further and further down the rankings of ICT-empowered nations. In 2003 the World Economic Forum's Networked Readiness Index ranked South Africa at 37. Now, we are down at 72.
The GSM Association, a body that represents mobile telephony operators worldwide, has opened its Africa office in Nairobi, because that has become the African hub of mobile communications. This is a pity, because our mobile application developers keep winning international accolades. Of 30 top brilliant African technology start-ups, as determined last year by Ventureburn, 13 were from South Africa - the highest number from any nation. Many of these are based in Cape Town, which is rapidly becoming the location of choice for high-powered creative talent. They are coming to this city and the Western Cape because, where it governs, the DA delivers on technology's opportunities for interactive service delivery for all the people who want to live and work here. [Interjections.]
By 2020 every resident of Cape Town will have access to broadband infrastructure in excess of 100MB per second. [Interjections.] This critical nervous system will turn Cape Town into an opportunity city, a city that attracts investors and innovators to establish growing, globally competitive enterprises that work and offer work opportunities to small, medium and micro enterprises, SMMEs, and individuals with a passion to excel and contribute to our nation's growth. [Interjections.] A globally competitive infrastructure is what the rest of South Africa can expect from the DA when it wins the national government in 2019. That is six years away. [Applause.]
So, will we miss the Department of Communications if it is closed down? I think the nation would prosper without it.
HON MEMBERS: Hear, hear! [Applause.]
Chairperson, compared to service delivery departments the R2 billion budget allocated to the Department of Communications seems to be very small. Yet through its strategic partnership with the private sector and state-owned enterprises, SOEs, it could direct the investment of billions of rands more in information and communications technology, ICT, infrastructure and services to the people through timeous and correct policy interventions and incentives.
Technical industry jargon and political jargon should not be allowed to obscure the fact that there is a very simple matter before us today. It is about our people and giving them access - wherever they live - equal access to the knowledge economy and to job opportunities. That is essentially what communications is about. The roll-out of broadband to schools and communities in informal and rural areas, coupled with intensive ICT skills development, has become a national priority. Indeed, ICT is the highway to development and prosperity. It is the ultimate key to empowering the disadvantaged people residing in remote areas. Without that our people will remain marginalised for generations to come.
The National Development Plan is setting a goal of 100% access to reliable broadband by 2020. Today, there are only about 13% of South Africans who have access to broadband. This calls for drastic intervention by government, including the provision of electricity to schools to bridge the gap.
Communication is about much more than controlling the news and spinning the President and Ministers out of trouble. It is not to appoint three Ministers in four years that the President is giving us an understanding that he understands the key role of this portfolio in a developmental state, even though the National Planning Commission recognises its strategic role to leverage job creation and the knowledge economy.
The fact is, unfortunately, that the Department of Communication has become the single largest stumbling block in the delay in the roll-out of cheaper and faster broadband in South Africa. It has effectively imploded. It is tied up in legal battles, turnover of disciplinary committees and internal strife. In fact, the Minister is at war with her own director-general. Apart from policy revision workshops, colloquiums, indabas and other talk- shops, as well as participation in international conferences, it has no measurable output. We now hear about Bills coming in the very last term of this Parliament. Its impact as an enabler of Telkom's roll-out is zero. In fact, the industry has to either fight it or work around it to roll out infrastructure, to offer services and to introduce the latest technologies in our country. Similarly state-owned entities, those reporting to this department, are mostly in shambles as a result of the Minister's political meddling in their functions.
The constitutionally enshrined Independent Communications Authority of South Africa, Icasa, is a weak lapdog of the Minister. Instead of optimising and managing spectrum and licensing fees effectively and independently, it fumbles and is embroiled in protracted legal action. These inefficiencies present the best excuse for the Minister to usurp its functions. Read the newspapers. Icasa should free up spectrum for broadband roll-out, but it is paralysed by the Minister's failure to conclude the spectrum policy.
The South African Broadcasting Corporation, SABC, has its third board of directors in as many years. Why? It is because of the political meddling and the remote control of news content from Luthuli House.
The Minister promised a forensic investigation into the serious corporate governance failures under the Ngubane board, but nothing is forthcoming. The turnaround strategy has failed. We wish the interim board all the best. Staff morale remains low. The top structure continues to consume the largest slice of the salary cake. Professional news reporters carry ANC membership cards for protection against witch-hunts and unfair disciplinary hearings. Ask them; that is a fact. Staff salaries are adjusted at the whim of the acting chief operating officer.
It seems that the Guptas did not only invade our air space, they will soon also control sections of our cyber space through the launch of their 24- hour news channel, courtesy of the SABC, who has given them free airtime to air The New Age, breakfast sessions and propaganda hours given to the Ministers and the ANC government. This is not a public broadcaster.
The Minister staged a crippling upset at Telkom. My colleague referred to that. There is an undisputable direct correlation between affordable telecoms and economic and job growth, also between ICT skills and economic activity. My colleague referred to the World Economic Forum's Global Information Technology Report of 2013, which does not give us a good picture of where we have gone; we have slipped down the ladder.
Countrywide broadband access, digital migration and cheaper rates to communicate have been identified by the DOC as their strategic goals, but what have they done? By their own assessment they have failed dismally in the previous financial year. What will make this year different? Key interventions need to be followed now.
First of all, spectrum policy should be finalised by no later than October this year, and Icasa must move swiftly to release spectrum. Secondly, government must take urgent steps to ensure that South Africa's digital migration takes place, and it must be done before June 2015, which is the international deadline. There is no excuse for not adhering to that deadline. Thirdly, government should stop acting as a referee and player in the ICT industry. It should get out of telecoms - in more ways than one. It should sell its shares in Telkom and other SOEs. It cannot direct ICT policy that dictates to Icasa, yet through Telkom and Sentech, and Broadband Infraco, compete directly in the ICT space.
It appears that political and commercial interests of the ANC government direct the Minister's meddling in the affairs of Telkom, Sentech, Icasa and the SABC. The digital terrestrial television, DTT, roll-out and set-top box manufacturing delay is a direct result of this political meddling and the interests of cronies and those politically connected business people.
Cope suggests that the Minister cannot drive the important processes that this department should drive at present. We would like to recommend that the Minister resign with immediate effect and the entire department be placed under the administration of the National Treasury. [Interjections.] [Time expired] [Applause.]
Order, members! Hon member, please take your seat. Hon members, please let us not make a lot of noise. Let us allow the proceedings to proceed without, or at least with fewer, disturbances. I hope that we will be together on this one.
Hon Chairperson, hon Minister, Members of Parliament and guests, my Chief Whip, hon J H van der Merwe, has asked that I tell you, hon Minister, that you look very smart today.
During this year's state of the nation address President Zuma made a fleeting reference to our ICT sector. He mentioned fibre optic cables and the plan to achieve full broadband by 2020. But that was all. Gone was the kind of bold statement our President made in 2009, when he promised that government would reduce the cost of communications.
This new-found reticence is not surprising. This department has become, as one newspaper recently put it, "a poisoned chalice". The department is now under scrutiny by Parliament and others. Serious damage is being done by the persistent allegations of corruption, nepotism and cadre deployment, which allegedly saw politically connected individuals land jobs within the Department of Communications' entities.
The now infamous ICT Indaba, which cost the Department of Communication just over R100 million, has left us with more questions than answers. To put this in context, with R100 million we could have provided some 1 000 schools with the necessary equipment for at least 20 computer laboratories. That would have been a fitting use for taxpayers' money. Instead, R100 million was spent on an indaba looking at ways to develop the ICT sector.
With this noble goal the IFP has no qualms. But did the indaba amount to anything more than an expensive talk-shop, aimed at benefiting a few politically connected individuals? We might never know. It is the IFP's view that nothing less than a full commission of inquiry will help us get to the bottom of these alleged scandals. South Africans deserve answers.
Instability remains the Department of Communications' Achilles' heel. We have had five Ministers in five years. This has stalled progress on critical projects such as DTT and the broadcasting and ICT review process. With each change of Minister, there seems to have been insignificant cognisance of the need for stability in the Ministry. Instability within the department has permeated all its entities. We have seen the decline of the SABC and Telkom. The SA Post Office, as the Minister has mentioned, has been crippled by strikes. While the SABC remains in the intensive care unit, it is unclear why the cash-strapped broadcaster continues to provide free airtime worth millions of rands to the Gupta-owned The New Age newspaper. The taxpayer already funds such a service in the form of the Government Communication and Information System, GCIS. Surely, if our public broadcaster has to double up on this service, it should be to the benefit of all South Africans, showcasing all views and all political parties. This arrangement cannot be to the benefit of a few. Tomorrow this House will debate Guptagate, but Guptagate is much wider than just Waterkloof Air Force Base. It extends to other institutions and entities.
The IFP agrees that steering the SABC back to health is our priority. We need to restore the credibility of the SABC. For that to happen, cadre deployment must stop. Let me pause here, though, and pay tribute, as the hon Muthambi has done, to all the dedicated staff, especially the journalists, who work under extremely difficult circumstances, yet keep the lights in the SABC running as well as quality news programmes on our TVs. They are doing a remarkable job. Let me also take this opportunity to pay tribute on behalf of the IFP to the SABC icon, Mr Vuyo Mbuli. We mourn the loss of a great journalist and a great South African.
The challenges that I have highlighted are by no means all the challenges facing this department. But they are critical challenges. In the face of all this, the department's rhetoric is unchanged. It remains confident that nothing will stop it from ensuring that all South Africans have access to world-class ICT services. How much of this has materialised? The stark reality is that to date not a lot has been done to deliver on these promises.
The IFP is astonished that the President can still speak so confidently about meeting the target of 100% broadband when this department has yet to deliver on their current targets. When one considers that an increase in broadband penetration is linked to an increase in the gross domestic product, GDP, it is astonishing that we are not putting more effort into reaching these targets now. A failure to do so will not only jeopardise South Africa's economic growth, but also the National Development Plan,