The Committee met to hear responses from the Department of Telecommunications and Postal Services (DTPS) to questions posed the previous week on SA Connect’s activities, and for final consideration of the iKamva Bill [B10B -2018].
Members asked about the budget for last mile connectivity, on the total budget until 2020/21, and whether any of this budget included the Western Cape/Gauteng rollouts. They wanted to know about the connections made and timeframes for the completion of the phases. What had informed the budget cuts and to what extent would the cuts affect targets? How were local communities “stakeholders”? Could outside parties become customers of this network? How were the numbers for site installations split between the Universal Service and Access Agency of South Africa (Universal Service and Access Agency of South Africa (USAASAUSAASA) and the State Information Technology Agency (SITA)? Could the core network accommodate only 570 sites? Why were so few Thusong centres being connected? What was the business case presented to the Development Bank of Southern Africa (DBSA)? What progress had been made with infrastructure in rural areas, as this had been a challenge?
When the iKamva e-Skills Institute Bill came up for consideration, the Chairperson said he had been approached by the Chairperson of the Portfolio Committee on Higher Education over their unhappiness that their committee had not been consulted on the bill. He said that it was appropriate for there to have been liaison with that committee, and if time had allowed he would have allowed this process, but the bill was part of a batch of bills that urgently needed to be passed. The Committee then reviewed the clean copy of the bill, which incorporated the many substantial changes it had made when going through it clause by clause the previous week, to confirm that all amendments had been made.
Members asked why the bill was so urgent that good legislative practice could not have been followed. They said the report should include a reference to Rule 288, and asked when the bill would come before the House.
The bill with amendments was adopted under its new amended title, the iKamva Digital Skills Institute Bill [B 10B - 2018].
SA Connect: Report back
The Department of Telecommunications and Postal Services (DTPS)l reported back on written questions raised by the Committee Members during a presentation given the previous week by SA Connect.
Ms M Shinn (DA) asked what the budget was for the last-mile connectivity that would be done by access network providers (ANPs).
Mr Tinyiko Ngobeni, Deputy Director General (DDG): DTPS, said ANPs connected government facilities to the nearest Broadband Infraco (BBI) point of presence. Together with BBI’s core network, ANPs’ access networks (last-mile) created full network connectivity over which the State Information Technology Agency’s (SITA’s) internet services were provided. The Department procured full network connectivity services from BBI, which in turn procured last-mile connectivity from ANPs. The Department thus did not directly deal with ANPs. BBI’s budget for 313 sites over three years, was R90m.
Ms Shinn asked who these ANPs were. How were they chosen? Who managed them?
Mr Ngobeni replied that the list of successful ANPs were:
1. 3H Consulting Services (Pty) Ltd;
2. Altech Radio Holdings (Pty) Ltd;
3. Brightwave Technologies (Pty) Ltd;
4. Galela Telecommunication Holdings (Pty) Ltd;
5. Maredi Telecoms and Broadcasting (Pty) Ltd
6. Mavoni Consortium;
7. Mobile Telephone Network (Pty) Ltd;
8. Safricom North West (Pty) Ltd;
9. Sentech SOC Ltd;
10. Singa Tel (Pty) Ltd;
11. Telkom SA SOC Ltd; and
12. TWK Communications (Pty) Ltd.
For Phase 1, the ANPs were appointed following a competitive tender process. Tender RFP INF/TEN/0219 was advertised on the National Treasury e-tender portal, on the Broadband Infraco website, and in the Sunday Times and City Press.
Sekela Xabiso (Pty) Ltd was appointed to conduct an audit of the SA Connect Phase 1 tender and the evaluation process, to ensure that the evaluation process was compliant with the relevant policies and legislation/regulations prior to the awarding of the contract.
During the implementation phase, the ANPs were managed by the Broadband Infraco Project Management Office. For the operations and maintenance phase of the network, the ANPs would be managed by the Broadband Infraco Network Operations Centre, as well as the operations and maintenance department.
Ms Shinn asked if the third party router for the aggregation network was chosen and if so, how and at what capital and operating cost for the medium term expenditure framework (MTEF).
Mr Ngobeni replied that currently BBI used existing infrastructure for the aggregation sites. However, for future expansion, it intended to use carrier class devices that could do a VLAN translation (merge all different sites into one service, thus saving on management resources). Such devices would also have high density ports (optical and electrical, 1G, 10G mixture), with dual power. The cost of these devices would be confirmed only once Broadband Infraco had issued an enquiry to the market and received responses with prices. Normal procurement processes would be followed for the upgrade.
The Department of Telecommunications and Postal Services (DTPS) would pay for services.
Ms Shinn asked how local communities were “stakeholders” in these municipal networks.
Mr Ngobeni replied that local communities would have ready access to these networks since the services would have been extended to these sites.
ANPs had been contracted to use local community services by Broadband Infraco. An audit would be done to check to what extent this was happening.
Ms Shinn asked if outside parties, such as small, medium and micro enterprises (SMMEs) in these communities would be able to become customers of this network. If so, how and at what cost?
Mr Ngobeni replied that BBI’s network was operated on an open-access basis, and so did ANPs, meaning that the networks were open to all licensed service providers, including local SMMEs. The cost to use these networks would be market related.
Ms Shinn asked if the national government network would be open to Internet Service Providers (ISPs) outside government on which they could run their own businesses.
Mr Ngobeni replied that it was possible, dependent on the case (terrain, distance, etc.). Some investment to extend the connection may be required.
ISPs that had been enabled could provide services to end customers.
Ms Stella Ndabeni-Abrahams, Deputy Minister: DTPS, said ‘community’ referred to the people in the area where the router was situated so that people could, for example, download a document they needed.
Ms Shinn asked if the private sector, in the form of small businesses, could use it for its business purposes.
The Deputy Minister replied that small businesses had access to it only insofar it provided training on how to do something. When the service was used for the purposes of running the small business, then the business had to pay for that service.
Ms Shinn asked what the total approved budget allocation from 2017 until 2020/21 was. Was it R750.9 m? How much of it had been approved by Treasury? Had Treasury put conditions on the deliverables before the next year’s tranche of money was released? Did any of this budget include the Western Cape/Gauteng rollouts? If so, how much per province?
Mr Ngobeni confirmed the budget figure was correct. The approved baseline allocation for 2017/18 to 2020/21 was R750.9m, inclusive of an approved R110m rollover. Submission of quarterly progress reports, showing planned vs achieved connectivity and the amount spent, was a Treasury requirement to ensure the continued baseline allocation for Phase 1.
The Phase 1 rollout excluded the Gauteng and Western Cape provinces. The two provinces would be included in the Phase 2 rollout to cover any gaps that may exist in those provinces.
Ms Shinn asked how the numbers for site installations had been split between the Universal Service and Access Agency of South Africa (USAASA) and the State Information Technology Agency (SITA)? What contribution had BBI made to these installations so far?
Mr Ngobeni replied that under the SA Connect Phase 1 rollout, the two entities mandated to carry out the broadband rollout were BBI and SITA. In this financial year, two government orders had been issued to BBI to install network connectivity to 915 sites (313 + 602 sites). Four government orders had been issued in this financial year to SITA to upgrade internet services to 257 sites (63 + 194 sites) and to activate internet services to 915 sites (313 + 602 sites), where BBI installed network connectivity. BBI had to date installed network connectivity to 312 sites.
Ms Shinn asked if the core network could accommodate only 570 sites. By the end of the year, would 882 sites be up and running (63+507+312). Could this be explained?
Mr Ngobeni replied that SITA’s core network had been optimised to accommodate the initial internet services to 570 sites (63 + 194 + 313 sites). The core network capacity had also been increased to accommodate internet services to an additional 602 sites. In total, the core network would accommodate 1 172 sites (570 + 602 sites).
Ms Shinn asked if Phase 1 rollouts were for a total 6 135 sites. How many of these sites had been/were being implemented by the Western Cape and Gauteng governments? From which budgets were these two provinces being funded?
Mr Ngobeni replied that the Phase 1 rollout excluded Gauteng and Western Cape provinces. The two provinces would be included in the Phase 2 rollout. The roll-out for the two provinces was from their provincial budgets which had been re-prioritised to focus on broadband roll-out.
The Department included the Gauteng and Western Cape provinces’ programmes when reporting because they contributed to SA Connect’s target of connecting government facilities at prescribed speeds and quality, as outlined in the policy.
Ms Shinn asked how much had been spent on upgrading the 63 sites of Phase 1A. How much was spent on the 312 new sites?
Mr Ngobeni replied that for the current financial year, R6.8m had been committed to upgrading 63 sites, while R53m was committed to network and service connectivity for 313 sites.
To date, SITA’s invoice value was R2.3m and BBI payments were R4.9m. SITA invoice verification was under way, with a site audit being conducted in parallel before payment was made. The BBI site handover was also under way before additional payment could be processed.
Ms Shinn asked why so few Thusong centres were being connected. Was this all there was in these districts?
Mr Ngobeni replied that there were more Thusong centres in these districts, but the site selection was constrained by considering those sites that were close to existing BBI infrastructure to minimise costs and increase the chance of completion within the remaining short period until the end of the financial year.
Ms Shinn asked what the estimated cost to the DTPS and its entities was of implementing Phase 1 to completion in 2022.
Mr Ngobeni replied that Phase 1 was being implemented in line with the MTEF base allocations. The base allocations to 2021/22 were R945.4m (inclusive of a R110 million rollover).
Ms Shinn asked what the business case presented to the DBSA had been? How much money was needed to connect all 35 211 sites in Phase 2? What was the timeframe for completion?
Mr Ngobeni replied that the Department had signed a memorandum of understanding (MoU) with the Development Bank of Southern Africa (DBSA) to conduct a feasibility study to determine a cost-effective and efficient roll-out of broadband for Phase 2, including determining the total cost of rolling out connectivity to 35 211 sites. The DBSA estimates that the study will be concluded in the 2019/20 financial year.
Ms Shinn asked what the estimated support cost of Phase 1 was. Who would bear the cost of keeping the network active?
Mr Ngobeni replied that the Department procured services from BBI and SITA. The service costs were inclusive of support costs. The costs to operate and maintain the networks were borne by BBI and SITA.
Broadband Infraco would be responsible to maintain the core network and the ANPs to maintain the last mile network. For example, Broadband Infraco’s internal estimated support cost over the 10-year project period was R148.1m.
Ms Shinn asked what steps were being taken to ensure that the departments, such as Health, Education and Home Affairs, were budgeting for and developing applications to make efficient use of the network.
Mr Ngobeni replied that discussion with Department of Health confirmed that once the SA Connect project provided broadband connectivity to health institutions, it wouldl utilise this connectivity to rollout information communication technology (ICT) applications which they had already piloted, to support the NHI initiatives.
The Department of Education had plans to roll out the electronic Learner Management Solution (e-LMS) which had been developed as part of World Cup 2010 legacy project. This e-learning platform would enable learners and educators to use ICT applications for teaching and learning in the classroom. The Department had also confirmed that the Department of Basic Education (national, provincial and district) would take care of end user devices.
For Home Affairs, the increased broadband speeds would enable the roll-out of Smart ID cards and associated capability.
Ms D Tsotetsi (ANC) asked what progress was being made with infrastructure in rural areas, as this had been a challenge
Mr Ngobeni replied that the majority of sites being connected were in rural areas. The current rollout scale was, however, still significantly small to achieve the desired impact.
Ms Tsotetsi asked what had informed the budget cuts. Was it a decision from Treasury, or had there been negotiations with the Department? To what extent would the budget cuts affect the targets.
Mr Ngobeni replied that the Department did not have an input on the budget cuts. The Department was informed once a decision had been taken by Cabinet. The budget cuts affected all, if not most, government departments which were running a major project. According to Treasury, the budget cuts were informed by national priorities.
The budget cuts affected the SA Connect targets significantly. For example, the number of sites to be connected in 2018/19 had had to be drastically reduced as there was only R9.7m available.
Ms Tsotetsi asked if all facilities which were tested had been activated.
Mr Ngobeni replied that sites being installed with infrastructure by BBI’s partners were the ones being tested to ensure compliance with SA Connect’s network requirements before services were activated by SITA, due to the funding for services becoming available in late August 2018.
Ms Tsotetsi asked if there were mechanisms in place to mitigate the risks effectively
Mr Ngobeni replied that operationally, there were governance frameworks to address strategic, operational, and technical risks. Financially, however, the risk mitigation was limited.
Ms Tsotetsi said election campaigns were always threatened by protests which were sometimes violent and caused damage to public property. In light of this information, how realistic were the Department’s time frames.
Mr Ngobeni replied that service delivery protests had the potential to impact the project. So far, the Department was fortunate that the protests that had been encountered had not impacted the project. The plans had actored in some of the major issues, such as third party approval of high sites, equipment delivery delays, etc. The Department and the entities, however, had been working hard and gone through a detailed process to shorten some of the timelines in order to complete the work. Therefore, if there were prolonged service delivery protests or there was damage to important equipment during the protests, the timelines would definitely be affected.
Ms Tsotetsi asked if further cuts in the budget were anticipated.
Mr Ngobeni replied that the Department did not anticipate further budget cuts, but a budget cut might have a serious impact on the roll-out of broadband. The positive progress and impact should also encourage National Treasury not to cut the budget. There was general agreement that ICT and broadband roll-out, in particular, was crucial for economic growth, including the Fourth Industrial revolution.
The Chairperson wanted a live demonstration on monitoring connectivity.
A live demonstration of how monitoring could be done, then ensued.
Ms Shinn asked that the installation at Thusong centres be fast tracked. She asked how secure Wi-Fi password protection was, because if the Department of Home Affairs bandwidth, for example, was used up by free Wi-Fi, then it would not be able to do its work.
Mr C Mackenzie (DA) asked if USAASA sites could be monitored.
The Deputy Minister said that it was not possible for the Home Affairs bandwidth to be used up, because the free Wi-Fi would be via a guest services account.
Mr Gift Zowa, Chief Technical Officer: BBI, said there were full controls over passwords, and a full capability to monitor connections.
The Chairperson said the Department’s presentations had to clarify between connections and activations because for the Committee, a connection was assumed to be an active connection.
iKamva e-Skills Institute Bill
The Chairperson said he had been approached by the Chairperson of the Portfolio Committee on Higher Education over their unhappiness that their committee had not been consulted on the bill. He said that it was appropriate for there to have been liaison with that committee and if time had allowed, he would have allowed this process, but the bill was part of a batch of bills that urgently needed to be passed. He acknowledged that Ms Killian had called for such consultation with the committee.
Ms J Kilian (ANC) said that when an institution was created, it was important that it complied with the Education ministry. Why was the bill so urgent that good legislative practice could not be followed?
Ms Shinn said the bill was four years in the making and had been before the Committee since May.
The Chairperson acknowledged it would have been appropriate, and said Ms Kilian had done her part in ensuring that gaps were covered. The bill would proceed, and he would have to take responsibility for any faults.
The Committee then reviewed the clean copy of the bill which incorporated the many substantial changes it had made when going through it clause by clause the previous week, to confirm that all the amendments had been made.
Mr Shaun van Breda, State Legal Adviser, took the Committee through the Bill, page by page, indicating the changes that had been made.
Mr Van Breda said that “section 6(8)” was changed to “section 6(7)” under definition 1, with reference to the clause [ "chairperson" means the chairperson of the Board appointed in terms of section 6(8)].
He said that where it said, “Higher Education and Training Act”, the words “and Training” had been removed. This also occurred in Clause 4(2)
Ms Kilian said there were references to the National Qualifications Framwork (NQF) Act, so should other acts also be mentioned?
Mr Van Breda said the acts were adequately covered.
Mr Van Breda said that in Clause 4(2), “Qualification” was changed to “Qualifications,” and the words “and Training” had been removed from “Higher Education and Training Act”.
Ms Kilian said that in Clause 4(2)(a), all the legislation was listed in the definitions, but the Skills Development Act (SDA) was left out of the definitions.
The Chairperson said that it was because the SDA was mentioned only once.
Mr Van Breda said “policy directives” had been changed to “policy directions” in clause 4(4).
The wording in Clause 5(2)(g) had been adjusted to read “the treatment of unspent and surplus funds and the recovery of damages and losses.”
Ms Kilian asked if in Clause 5(2), the word “institute” should not be replaced by the word “system.”
Mr Van Breda said the word should be “institute.”
In Clause 5(4). the word “Qualification” now reads “Qualifications.”
Mr Van Breda said that in clause 7(3)(a), “subsection (1)” now reads “subsection (4).”
Mr Van Breda said that in 10(1)(a), “section 9(2) and (3)” now read “section 9(2) or (3).”
Mr Van Breda said that in Clause 11(8), subsection 4 had been excluded because it could not be contravened.
Mr Van Breda said that in clause 13(2)(b)(iii), it should read “members on a committee” and not “members of a committee.”
Clause 13(6) had been redrafted, and now read: “A committee, with due regard to financial prudence, may meet….”
Mr Van Breda said Clause 14(2) now read “….must elect a non-executive member from amongst themselves to preside at such a meeting.”
In Clause 14(8), “via an Electronic Communication facility” now read “via Electronic Communication.”
This now read “ …to the Board, for the Board’s consideration, which are consistent with the objects of this Act.”
On 23(8), the clause now read “. officer of NEMISA, excluding persons acting in such positions, immediately…”
In the Memorandum of the bill, South Africa’s ranking in Clause 1.2 had been updated to reflect the 2016 ranking of 65th position.
In Clause 1.6, the final name for the entity was agreed upon to be the Ikamva Digital Skills Institute, and reference to “e-skills” had been changed to “digital skills.”
Mr Van Breda said the that the duplicated word “relevant” in Clause 3.3 of the Clause by Clause Analysis would be removed.
He said there were now paragraphs inserted in Clause 5 to cater for the Regulatory Impact Assessment (RIA).
Clause 6 now read: “The Department and the State Law Advisers are of the opinion that the provisions of the bill are not unconstitutional.”
Ms Kilian said the report should include a reference to Rule 288.
The Chairperson put the Committee report forward for adoption with amendments. The Committee report on the bill was adopted with amendments. The DA reserved its position on the bill till further discussion with its caucus.
Ms Shinn asked when the bill would come before the House.
The Chairperson said it would be by 30 November, because it also needed to go before the National Council of Provinces (NCOP). The Committee had to date received one submission on the Electronic Communications Act (ECA) bill.
The bill with amendments was adopted. The Committee report stated that having considered the
subject of the iKamva National e-Skills Institute Bill [B 10 – 2018] (National Assembly – sec 75), referred to it and classified by the Joint Tagging Mechanism as a section 75 Bill, reports in terms of National Assembly Rule 288 that it has agreed to the Bill, as redrafted, with a new amended title, namely the iKamva Digital Skills Institute Bill [B 10B - 2018].
The meeting was adjourned.
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