Departments of Communications & Telecommunications & Postal Services Annual Performance Plans, with Minister & Deputy

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Communications

03 July 2019
Chairperson: Mr H Papo (ANC)
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Meeting Summary

Minister Stella Ndabeni-Abrahams noted the separate Annual Performance Plans presented today by the Departments of Communications and Telecommunications and Postal Services and their entities However, the deadline for the departments’ reconfiguration into a single department in the Sixth Administration is 1 April 2020 and by September 2019 the departments will submit a joint Medium Term Strategic Framework (MTSF) submission to National Treasury. Once the two departments have merged, the Ministry will ensure that department employees are up-skilled and rechanneled and it will avoid by all means necessary to dismiss any of them. The Ministry had decided that it be compulsory for the department and its entities to undergo a skills audit.

To assist the SABC, at a cost of R3.5 million, the Government Technical Advisory Centre (GTAC) which is a technical agency under Treasury, has been appointed to develop a tight turn-around strategy for the SABC. More emphasis would be channelled on ensuring the digital migration project is realised to ensure the sustainability of the SABC.

The Department of Communications shared its MTEF plans which were:
- Improving universal access to broadcasting services and information
- Review broadcasting digital migration delivery model to accelerate release of radio frequency spectrum
- ICT SMME and Enterprise development
- International participation and engagement
- State owned company governance – repurpose SOCs to improve efficiency and service delivery.

The department would ensure compliance with statutory requirements and good governance practices by:
- finalising the reconfiguration of the department to achieve its mandate
- facilitate the implementation of the approved Workplace Skills Plan in line with the reconfigured mandate
- unqualified audit outcome
- 100% compliance with the 30 days invoices paid
- implementation of the procurement plan with focus on enhancing industry transformation and youth economic inclusion
- strategic assessments conducted and risk register updated.

The Department of Telecommunications and Postal Services noted its plans for broadband were:
- monitoring provision of broadband services to 570 connected sites
- coordinating roll-out of broadband services to additional 400 sites.
- maintaining operations of the rapid deployment national co-ordination centre
- monitoring operations of the cyber security hub

As for reconfiguration, both departments have commenced participation in the National Macro Organisation of Government (NMOG) process led by Department of Public Service and Administration (DPSA). Immediate focus would be on development of the macro organisational structure; placement of staff in the new department and creation of a new budget structure. Plans were put in place to commence with joint strategic planning to craft the short to medium term strategy for the merged Department, inclusive of its vision, mission and mandate.

Members asked questions about the licensing spectrum; diagnosis of the challenges at SABC and if they could be resolved; the SABC’s responsiveness to the assistance provided by government; timeframes for amendment of the Broadcasting Act; if ICASA was adequately funded to license the spectrum; if a review of digital terrestrial television (DTT) has been conducted, and if so, what is the outcome and would a review include developments in the sector?

Members were not happy about government’s efforts in rescuing the SABC from its financial woes. Members demanded a clear programme of action to rescue the SABC and clarity on the outcome of the Department’s efforts since February. There was no clear articulation on what has occurred since February until now. Members probed the significance of the 5G conference and how South Africans could utilise its opportunities; the long term plan to ensure the sector was competitive to reduce data charges; how much of the country was currently covered by the DTT signal, and consumer experience of the DTT signal.

The South African Broadcasting Corporation APP was presented. The SABC board chairperson said the Board inherited an organisation that was still in a dire financial state. This was caused by maladministration, non-compliance, poor decision making and collapse in government. The SABC debt stood at R1.9 billion owed to content providers, Sentech and maintenance of the main infrastructure. Despite these challenges, due to the strategy put in place, the SABC has been able to run and the executive managed to deliver on key activities such as the 2019 elections coverage.

The new SABC strategy includes the Public Protector Report remedial actions which are binding on the SABC and must be implemented. Secondly, the strategy speaks to the Parliamentary Ad Hoc Committee Inquiry’s 24 recommendations which the SABC is expected to implement. Thirdly the SIU investigation found 23 disciplinary committee, seven litigation and six criminal matters. The Auditor-General report also helped the Board to understand a number of irregularities that must be corrected. An internal forensic investigation produced about 180 forensic reports that addressed non-compliance at various level of the organisation.

Risks for 2019/20 include:
- Budgeted revenue growth is more than the past three-year average and might not be attainable
- Possible litigation has not been factored, especially from long outstanding creditors
- Contingencies have not been considered in the budget
- Risk of expenses increasing more than the 5% anticipated, increasing net losses further
- Infrastructure has not been maintained and potential breakdowns could create unforeseen expenses
- Declining audience share due to lower investment in content in the past financial years
- Ban of alcohol advertisements and introduction of sugar tax, and
- Lack of capacity to implement Capex plan.

Uncertainties were:
- Approval of government guarantee application
- Implementation of Capex Plan (OTT) will yield savings in signal and distribution costs.
- The new television channels to be created through DTT migration have not been factored in the budget
- Disposal of non-strategic assets
- Quantum and pace of the staff optimisation process
- Revenue from new strategic initiatives has been adequately identified and quantified
- Displacement cost for sport events not yet committed but likely to be broadcast have not yet been factored
- Staff optimisation has not been factored in the base budget due to uncertainties in implementation timing. It is only factored from 20/21.

Members asked for an update on the SABC alleged retrenchments and salaries not being paid as well as when Day Zero was anticipated; how SABC used its radio dominance to support its financial viability; plans to recover lost viewership and more information on the way forward on the rehabilitation process; and for clarity about the plan for reallocation of staff to other areas to generate revenue.

South African Post Office (SAPO) reported that the Universal Service Obligation (USO) subsidy has been reinstated for the public service mandate with R1.5 billion allocated over the medium term and R474 million for 2019/20. Revenues had increased by R1.2 billion due to SASSA – R564 million, DTT – R243 million, Postbank interest – R143 million, Sales Initiatives – R312 million, Tariff – 8% and the retention of customers and volumes. Expenditure increased by 9% due to staff, transport, and IT costs. Cost optimisation would be undertaken to match lower revenues.

ICASA reported that the IMT Spectrum licensing project was initiated in 2016 for 700 MHz, 800 MHz and 2.6 GHz bands but was later interdicted. The process was currently underway for promulgation of a Policy Directive by the Minister and ICASA was working on its state of readiness to commence the licensing process once the Policy Directive was issued.

ICASA noted that the target this year for the Data Services Market Review initiated in 2016/17 in response to “DataMustFall”, was a Findings Document of the market review inquiry. The process would run parallel to the Data Market Inquiry undertaken by the Competition Commission.

Members asked if the introduction of new technologies at SAPO would impact on jobs and requested an update on former ICASA council chairperson, Rubben Mohlaloga.

Broandband Infraco, SITA, USAASA, USAF, .ZADNA, NEMISA, and NEMISA also presented their annual performance plans but due to time constraints, no engagement from Members took place. However, the Chairperson indicated that the entities would be invited to come to Parliament again for more fruitful engagement.
 

Meeting report

The Chairperson acknowledged the presence of the Minister and Deputy Minister. Due to time constraints, he appealed to Members to keep questions and engagement brief so that all entities present would have the opportunity to present. He assured Members that entities would be invited again for much more detailed engagements.

Minister of Communications & Digital Technologies remarks
Minister Stella Ndabeni-Abrahams noted that the President had merged the Department of Communications and Telecommunications and introduced the ‘digital technologies’ component to it. Many people have been asking why the Department was still referring to itself as the ‘former Department of Communications and Telecommunications and Postal Services’. This was because when the merge started, Treasury processes had already started and departments had to submit their APPs to Treasury in April.

The process employed to bring the two departments together is called the National Macro Organisation of Government led by the Presidency and DPSA. The two departments participate in its National Steering Committee and have been engaging to ensure that the process occurs smoothly; work streams and committees such as finance, human resources, infrastructure, legal and communications were established so as officials are transferred to the new department, everybody is well looked after.

Key to the process is the structure of the reconfiguration of the two departments. The new department has a key mandate as besides the digital technologies mandate, it must lead the Fourth Industrial Revolution which changes the mandate of the past for the Department of Communications. The 1 April 2020 is the set deadline for the two departments to have merged and in September 2019 the departments will ensure that the MTSF and submissions to Treasury are done jointly. The process started in November 2018 when the President first mentioned the merger. Ever since the Ministries have ensured that when the EXCOs of the two departments meet, they meet jointly to ensure that executives from the two departments understand what is happening in each other’s department.

When the moratorium was introduced, the Ministry realised that once the departments have been merged there must be one chief financial officer and other key officials for the merged departments but now there are twins. The strategies in place would ensure that personnel would be rechanneled, up-skilled to keep aloof from dismissals or retrenchments. The Ministry also decided that it would ensure that it becomes compulsory for all entities and the department to undergo a skills audit process. The nation has not yet been addressed on the new department’s future plan because the Ministry wants to ensure that it understands the capabilities within the department before undertaking that exercise.

For the purpose of today’s meeting, the APPs will be different; the DoC will present its APP separately as well as the DTPS due to priority projects that each department plans to undertake during the financial year.

As for the SABC, a team will be looking into its failures and successes to best ensure that the ultimate goal to assist the SABC to turnaround is achieved. In 2011, a bailout was given to the SABC but a turnaround strategy was not implemented. The Ministry has provided support to the SABC by appointing Government Technical Advisory Centre (GTAC), an agency of National Treasury, to help the SABC develop a turnaround strategy.

Five Members resigned from the SABC Board due to the burning issue of Section 189 retrenchments and the turnaround strategy that had been presented to Parliament in 2018. Prior to that the Standing Committee on Public Accounts (SCOPA) had raised concerns about it. The newly appointed SABC Board Members have ensured that the SABC continues to operate. At the time the SABC Board presented the turnaround strategy to the Ministry, the Board said that one of the key items that contribute towards the SABC challenges was an over-bloated personnel. Subsequently discussions took place and the shareholder was required to go to Treasury and plead the SABC’s case. There were disagreements between the Board and the shareholder and board resignations emanated as a result. However, the board members who resigned were actually in support of the shareholder even though it was widely sensationalised and reported that the shareholder wanted to micro-manage the SABC or the Board.

A budget of R3.5 million has been set aside to assist the SABC with the turnaround strategy because the previous turnaround strategy was turned down by Treasury as in fact it was not good enough as it did not meet the bailout funding requirements.

There was a rumour that government ignored trying to assist the SABC because the SABC made an application way back for the bailout. Even though that is partly true, the SABC withdrew that application and the then Board decided to pursue funding elsewhere. Upon realising that it was difficult to acquire private funding, SABC was forced to come back to Parliament. Most people when they report about this matter claim that all ANC Ministers that have been deployed to this portfolio ignored the SABC. The Minister clarified that this was false and all the ministers have given account. When the SABC decided to withdraw the application, there was nothing the shareholder could have done if the entity withdrew its application.

Treasury as well as the Ministry raised concerns about the turnaround strategy. The Ministry decided to act and sought external support to assist SABC and develop a responsive turnaround strategy to ensure that in the next three to five years the SABC does not come back and ask for a bailout. This is taxpayers’ money – we do know that government has specific processes for a bailout application, and those processes must be adhered to and not be undermined due to pressures. Government has agreed that SABC must be bailed out in the interest of the public – not the shareholder, board members or executive – to ensure that its mandate is realised. The Minister of Finance has since issued a directive to his Director-General to work together with the Department of Communications and everybody from SABC as we have been doing. We have delegated people from the Department to ensure that they interact with the people from the SABC to achieve all the conditions that must be met to fund the SABC. There is a meeting scheduled for Thursday for the DGs to meet.

On the digital migration project, we have experienced a lot of changes and challenges. Everybody talks about the cost to communicate, the need to make sure that data costs fall. We believe that the sustainability of the SABC relies on digital migration. Statistics show that YouTube is the biggest driver of news followed by people. The Ministry plans on making interventions but Minister Ndabeni-Abrahams said she would not reveal the interventions as she did not want to spoil her budget speech.

Ms P Van Damme (DA) requested for an opportunity to ask the Minister questions before getting into the APP because the Minister had made a political presentation.

The Chairperson advised that the Minister would be asked questions later.

Department of Communications (DoC) 2019/20 Annual Performance Plan
Dr Mashilo Boloka, Acting DoC Director-General, highlighted the MTEF plans which were:
- Improving universal access to broadcasting services and information
- Review broadcasting digital migration delivery model to accelerate release of radio frequency spectrum
- ICT SMME and Enterprise development
- International participation and engagement
- State owned company governance – repurpose SOCs to improve efficiency and service delivery.

The Department would ensure compliance with statutory requirements and good governance practices by:
- finalising the reconfiguration of the department to achieve its mandate
- facilitate the implementation of the approved Workplace Skills Plan in line with the reconfigured mandate
- unqualified audit outcome
- 100% compliance with the 30 days invoices paid
- implementation of the procurement plan with focus on enhancing industry transformation and youth economic inclusion
- strategic assessments conducted and risk register updated.

Department of Telecommunications and Postal Services (DTPS) 2019/20 APP
Mr Robert Nkuna, DTPS Director-General, reported that for Broadband, the Department will focus on:
- Monitoring provision of broadband services to 570 connected sites
- Coordinating roll-out of broadband services to additional 400 sites.
- Maintaining operations of the Rapid Deployment National Co-ordination Centre
- Monitoring operations of the Cyber security Hub

The Department will prioritise the following policies and legislation:
- Digital Development Fund (DDF) Bill
- Big Data and Cloud Policy
- Review of Integrated ICT Policy White Paper
- Development and submission of State IT Company Bill to Cabinet for approval for re-purposing of SITA
- Development and submission of State ICT infrastructure Company Bill to Cabinet for approval
- Develop draft WRC-19 Outcomes Report to inform review of National Radio Frequency Plan (NRFP).

As for the reconfiguration of the two departments, both departments have commenced participation in the National Macro Organisation of Government (NMOG) process led by DPSA. Immediate focus would be on; development of the Macro Organisational Structure; placement of staff in the new department and creation of a new budget structure. Plans were in place to commence with joint strategic planning to craft the short to medium term strategy for the merged department, inclusive of its vision, mission and mandate.

Minister’s Remarks
The Minister shared that currently a broadband plan is being rolled out to the country by the DTPS. The Post Office is the centre of the distribution of the social grants but people have complained about their grants and there were challenges linked to that. The President mentioned in his SONA response that government has covered a lot of ground in that respect. We are working closely with the entities under the DTPS to ensure that all key government priorities are well looked after as well complying with good governance.

As the Ministry is working on the development of the shareholder compact, the teams would ensure that an analysis of the entities in relation to state capture and corruption were completed and the ethics and the integrity of the people employed in those entities aligned to the broader framework and priorities of government.

To contribute towards growth of the economy, SMMEs would be put in the centre. An ICT and SMME (Small Micro Medium Enterprises) Strategy will soon be produced and implemented.

As we talk about technologies, everybody thinks about it at a consumption level but we are looking at refocusing technology by prioritising local technologies that are produced in the country.

She pleaded with Members to start making use of local domains instead of international domains. The department needs to be reprioritised to boost local technologies and content.

Discussion
Ms N Kubheka (ANC) asked what government’s thinking is on the objectives of the licensing of radio frequency spectrum. On SABC, what is the diagnosis of the current challenges and are the challenges resolvable?

Mr L Molala (ANC) asked what is being done in terms of policy and financial instruments to assist the SABC and if any progress could be reported to the Committee. He asked about the SABC’s responsiveness to the assistance provided by government. When would the Broadcasting Act be amended to strengthen the SABC? It was mentioned before that it would be amended – is that process still going to happen? How confident is the Minister that the spectrum will be licensed without delay after issuing the policy directive? Is ICASA adequately funded to license that spectrum?

Ms P Van Damme (DA) was pleased to hear that the departments would be focusing on the digitisation of communications. However, there should not be over-regulation but a steady focus on SMMEs and job creation in the sector while ensuring job sustainability. She said that state employees being be provided with digital skills, was move in a positive direction.

On the ICT state company, Members do not want a Bill that will centralise the control of the sector. She would much rather prefer something that lays the ground for companies to develop and survive. Government should make the conditions for companies to develop and survive much easier.

With regards to the SABC, she was concerned about the acrimonious relationship between the Minister and the SABC – there is always friction between the SABC and the Minister. It is important for all parties to be mature and do their jobs. It is incorrect for the Minister to come to Parliament and lay down a back story about the SABC. Members have been in Parliament dealing with the SABC. There was no point in the Minister raising what the Board Members who resigned had said. It is incorrect to say that they agreed with her – there is no record of that. And there is a court ruling that describes the Minister’s role.

The matter of the SABC pursuing private funding from the banks was resolved in February. Since then government has done nothing to assist the SABC. She cautioned the Minister to refrain from misleading Members. So what has been done from February until now? What has the government and Treasury done so far for the SABC and when will there be an outcome? The public has been told about the infamous coming of Day Zero but when is there going to be an outcome about a financial resolution? She was not interested in the fights the Minister has with the SABC but in when the crisis would be resolved.

On the Broadcasting Amendment Bill, the Bill came to Parliament but it was withdrawn and the Department said that it would go back to the drawing board. She asked what the new bill is going to contain because the last one was classified as unconstitutional. Members do not want to hear about the Broadcasting Act yet, and it might not be approved.

On DTT, the department has been talking about this for a really long time; in the meantime technology has moved on. A thorough review needs to be conducted, before further implementation, on all the technical advances that have happened, because technology has advanced since DTT was first mentioned. In addition, there is never enough money allocated to that process. She asked if a review has been conducted, and if so, what is the outcome of that review and would it include developments that have occurred in the sector?

What is the deadline for the reconfiguration of the departments?

Mr W Madisha (COPE) said that the merger was indeed important and these two departments should not have been separated to begin with. A clear programme of action on the reconfiguration of the departments has not been presented. What is the programme of action that will be followed for reconfiguration?

On the SABC matter, he hoped that the Minister will take a stern approach in ensuring that the SABC challenges were dealt with before the SABC collapses.

Mr T Gumbu (ANC) said that the Director-General of Telecommunications and Postal Services mentioned the World Radio Conference and the Frequency Spectrum; he asked about the significance of the conference on 5G technology and how South Africans could utilise the opportunities.

Ms A Mthembu (ANC) asked about the long term plan to ensure that the sector was competitive in a way that reduces data charges. Data charges are very high in South Africa. Secondly, how much of the country is currently covered by the DTT signal, are any communities receiving DTT signal and what are consumers’ experiences with the DTT signal?

Deputy Minister Pinky Kekana responded that with the existence of the two departments, the regulatory policies would require concurrence and buy-in from both departments. This may have informed the President’s decision to merge the departments. When the departments were brought together, it was realised that the policy directives and frameworks were more inward looking instead of outward looking. Thus the Ministry was now looking at a broader, outward spectrum in order to create legislation that will respond to the broader spectrum of the country. The President appointed the Fourth Industrial Revolution Commission which will play an important role by identifying gaps in the sector and the state-of-readiness of the country in relation to skills and other important factors. The Commission will also assist in ensuring that the country is not only consuming but also supplying and manufacturing.

On the SABC diagnostic report, the previous Board went through the challenges of the SABC including the Special Investigating Unit investigation to look into what went wrong at the SABC. Hence, the turnaround strategy exercise was undertaken under then-Minister Nomvula Mokonyane. When the new Minister came in, the Ministry reviewed the strategy. The engagement with banks and other stakeholders is ongoing and it is led by the Minister of Finance.

On DTT, government took long to implement the DTT programme. The department went to the Free State to look into whether migration had taken place. It looked at different areas and found challenges. The Ministry will review those challenges and come up with solutions because the DTT programme is needed in some areas. The Department also found that the installers of DTT signal were not based in the Free State but in Pretoria which becomes problematic when wanting to address the installation challenges.

Minister Ndabeni-Abrahams responded on the spectrum licensing process, saying that a policy directive would be issued within a month and address the imbalances as well as transformation and contribute to the reduction of the cost to communicate in the form of data charges.

As for the SABC challenges, the Ministry cannot say for now if money will be transferred to the SABC account. She could not pre-empt how the upcoming meeting with the Director-General of Finance would turn out. The department and the shareholder are also working very well with the current SABC Board – correspondence and communication is constant. In addition, the SABC is responsive to the Ministry’s efforts to turn it around. She meant it when she said the ANC government has been prioritising the SABC; if one looks at the resolutions taken by the ANC, one would find that the ANC has been consistent in assisting the SABC in order to fulfil its mandate.

The regulations and frameworks that have been put in place do obliterate some of the progress that could be made to steer the SABC swiftly towards a sustainable direction. However, be as it may, those regulations and frameworks must be adhered to. The Ministry went further to source external assistance to ensure that the SABC was assisted. The government guarantee application was made by the SABC but later withdrawn and so the process was halted.

Whether the Board Members and the shareholder like each other or not is irrelevant. There is no space to be fond of each other but rather the commitment to address the challenges of the SABC. The SABC is responsive to the assistance that it receives from the Ministry.

As outlined in the presentation, it is indeed true that we will be tabling the Broadcasting Amendment Bill to Parliament, not the Act but the Bill which has components that will ease the SABC of certain burdens. The intention behind the amendments will be aired to Parliament. In 2020/21 the Department would monitor its implementation. It is the Ministry that introduces legislation to Parliament, and it would never encroach on Parliament’s role. However, the Ministry would need Parliament’s support on this. A presentation on the Amendment Bill will be made to Parliament at a later stage.

The Ministry is confident in terms of the release of the policy directive on the licensing spectrum. We are currently engaging with the Regulator. The process is not only between the shareholder and the Regulator but it involves other stakeholders. ICASA is adequately funded and a sum of R10 million has been transferred beside the annual allocation it receives from the Department.


In building the digital society, the Department through NEMISA partners with different institutions across the country. In the Western Cape it works with University of Western Cape, in Eastern Cape with the Walter Sisulu University and other institutions in other provinces. A programme has been launched on this at the University of KwaZulu Natal and a study commissioned to look at the skills gap in digital skills.

The court ruling on the SABC in relation to the shareholder will be brought and circulated to the Committee, so that Members can understand that it does not only refer to the role of the shareholder in the SABC but on employment. There is no court ruling that can say the shareholder must stay away from the SABC and still pump money into it. It is not the shareholder’s money but taxpayers’ money.

The deadline for the reconfiguration is 1 April 2020. Strategies have been set up looking into the human resources and finances component. A skills audit was also conducted to ensure that the department places capable and competent personnel in key positions.

On the opportunities of 5G technology, personnel would be empowered and up-skilled and employment created through innovation hubs as the President mentioned; the only challenge is the lack of coordination. This is something that will be looked into by the Department. This will be made possible through Parliament via legislation in an agile manner and understanding the current terrain.

The Deputy Minister had already highlighted the DTT challenges and she echoed the same sentiments. When the programme was rolled out initially, the plan was to obtain service providers at a national level not at the local level so it was easier for households to access service providers for servicing the set-top boxes.

Ms Van Damme interjected and said some Committee Members have been in the Committee much longer than the current Minister has served in her portfolio, and Members have seen a revolving door of ministers. She asked the Minister to keep aloof from misleading Members. In November the Minister said that she will stop engaging with SABC and she would “stop working with the SABC”, but if that is not the case anymore, she congratulated the Minister on that.

She said, “If you are going to come here and talk about “ANC this, ANC that” – you are not the government of the ANC but the government of the people. In this Committee we do not speak about politics, we understand that we are here to hold you accountable, that is how we worked as a Committee in the last Parliament. We know you are the ruling party, we do not need to be reminded of that.”

The presentation on page 15 speaks to Broadcasting Amendment Act; you were able to give an overview about the ICT Company Bill. We would like an overview about the Broadcasting Amendment Bill. If we are going to debate next week, you cannot say to us that we should wait for your budget speech; we are here to get information from you. So what will be in the Broadcasting Amendment Bill? Members want an overview of what the Bill would contain.

The SIU and SCOPA report was a Parliamentary Inquiry which was instituted by Parliament and government cannot credit itself for that work and the Minister must not boast about that because the ANC led government let SABC rot. It was the ANC government that allowed that to happen, and it was her (Van Damme) that pushed for that Parliamentary Inquiry – the Minister should not try and spin things.

On the funding, what does it mean ‘process of funding’? These are empty words and it’s been months; Members need a more detailed report on the funding analysis of the SABC. Members conduct oversight over the Ministry, not the other way round and when Members request information the Minister must provide it in a detailed manner. The Minister should also stop using an attacking tone. The public has been enquiring and the SABC staff members are depressed as they do not know if their salaries would be paid at the end of the month. These are people’s lives we are talking about.

She asked the Chairperson to protect Members from the Minister’s tone.

The Chairperson advised that if Ms Van Damme wishes to be addressed in a particular manner, she must be prepared to do the same. It is important that from both sides there is amicable engagement and a proper tone in addressing each other.

Ms Van Damme indicated that in the previous Committee, Members worked very well and in unison, and the former Chairperson protected Members from the condescending tones of officials and he would called it to order immediately. She appealed to the Chairperson not to allow officials or the Minister to play politics. If the Chairperson picked up that the Minister’s tone was wrong, he should have called the Minister to order immediately and not wait for her to respond.

The Chairperson interjected and asked Ms Van Damme not to teach him how to chair the meeting. It is important that Ms Van Damme respects other people if she wants to be respected. It is important not to be abrasive, from both sides, and we need to respect each other. There are a lot of Members who have extensive experience in the legislative sector, so Ms Van Damme should keep aloof from being patronising and undermine others.

Ms Van Damme said that the Minister misled the Committee and the public about the SABC judgment. Members have read the judgment, so it is also patronising for her to say that she will give Members the judgement. She wanted to put it up front that she would not be policed about what questions she wants to ask, and her tone. If it makes people uncomfortable, that is their issue. She will be respectful and the public does not expect Members to be monotone in holding the Executive accountable. If there is a problem, she will speak how she feels so that the problem should be addressed.

She read a passage from the SABC judgment relating to the shareholder’s role:

“The Minister as the representative of the shareholder, not of the Board, does not have the right to act on behalf of the SABC or manage its affairs. The ultimate decision-making power is that of the Board not of the Minister as the shareholder. The Minister is accordingly precluded from exercising any powers by which she may control the Directors in how they control the affairs of the SABC.”

The judgment did not relate only to employment but to the relationship between the Board and the Minister. Therefore, the Minister should not mislead Parliament.

The Minister apologised if she came across in any way condescending to the Members or if her tone was inappropriate. As for misleading Parliament as Ms Van Damme alluded, every time judges issue judgements, there is context to the judgement and when people read the judgment they should not only extract the passages that suit them.

In response to claims that she would “stop working with the SABC”, she said that she will not be the shareholder that asks for money if she does not know what the money will be used for. If Members feel that is un-ministerial and disrespectful, she might as well step down because she must take full responsibility on how the money will be utilised. As a matter of information, she never stopped engaging with the SABC. The DDG would speak to the funding process.

Ms Van Damme interjected and said that if the Minister was going to be allowed to use such a tone, it must not be one-sided. She would not mind robust engagement. If the Chairperson will police tone, he must do so on both sides.

The Chairperson did not issue a ruling on the matter but allowed the Minister to continue responding.

The Minister once again apologised if she offended Ms Van Damme by her tone. She did not intend to do so.

The Chairperson said that he would not police Members about their tone. However, he appealed that Members and the officials respected one another when addressing each other.

The Minister replied about the “Broadcasting Amendment Act” that, as outlined in the presentation, this is a strategic goal – something that the Department will be working towards. It did not mean it was already approved.

The Chairperson asked if the Amendment Bill would take into account some of the concerns that the Committee had raised in the previous Parliament.

The Minister said that the Bill would take into account all the concerns raised by the previous Committee. In addition, in her budget speech, she would unpack in more detail some of the aspects of the Amendment Bill.

The Deputy Minister said the Broadcasting Amendment Act would look into issues around governance and the sector in its totality.

Mr Nkuna responded that the merger announcement was made in November 2018, and the officials already knew that there would be a process that will be regulated and legislated on how the merger would take place. That process is run by the Presidency and DPSA – the process would be proclaimed by the President. We started our own internal process as the departments by working together notwithstanding the fact that there will be a regulated and legislated process. That process will outline all the details which all merged departments will be subjected to. We are following the DPSA process and in September 2019 we must submit the joint MTSF and APPs.

South African Broadcasting Corporation on its 2019/20 APP
Mr Bongumusa Makhathini, SABC Board Chairperson, stated that the Board inherited an organisation that was still is in a dire financial state. This was caused by a number of issues such as maladministration, non-compliance, poor decision making and collapse in governance. The SABC debt stands at R1.9 billion owed to content providers, Sentech and maintenance of the main infrastructure. Despite these challenges, due to the strategy put in place, the organisation has been able to run and the executive managed to deliver on key activities such as the elections where the SABC delivered one of the best election coverage in history. We continue to deliver on our mandate.

The strategy is underpinned by three main things such as legacy and governance which talks to the oversight role that the Committee plays. There was a Public Protector Report that came up with a number of remedial actions which are binding on the SABC and must be implemented. Secondly, it speaks to the Parliamentary Ad Hoc Committee that came up with 24 recommendations which the SABC is expected to implement. The last one speaks to the SIU investigation which came up with 38 matters and about 23 of those matters relate to DC, seven are litigation and 6 are criminal matters.

There was also an AGSA (Auditor-General of South Africa) report which helped the Board understand a number of irregularities that we are expected to implement. Lastly, it talks to the internal forensic which produced about 180 forensic reports and those reports speak to things that have gone wrong relating to non-compliance in various levels of the organisation. So the theme of the strategy stems from these components. People were being disciplined, some resigning and being to account.

The second main theme speaks to a number of regulations and policies that have made it impossible for the SABC to be financially viable such as acquisition of sports rights, “must carry” regulations and TV licenses. For over a decade TV licenses have not been reviewed. South Africans pay about R1 a day for 18 radio stations and five TV channels. The SABC is not properly funded to deliver on the mandate. There are also other internal elements that talk to the constraints in the PFMA (Public Finance Management Act) which make it harder for the SABC to be fast in responding to the requests and what is required by the clients. The SABC is competing with people who are not constrained – it takes longer for the SABC to respond to what is required by the clients. The regulations and policies have external elements where Parliament, ICASA and the Ministry can assist in to deal with these challenges.

The third theme speaks to commercial and operational elements which includes driving the revenues up. Secondly, we are looking at cost containment and internal inefficiencies. It has taken longer to receive the financial assistance that the SABC applied for.

Mr Madoda Mxakwe, SABC CEO, presented the APP noting SABC’s bouquet of services includes 18 radio stations, five television channels as well as a digital media offering. A 19th radio station, Channel Africa, is managed by the SABC on behalf of the Department of International Relations and Cooperation. To many who have limited access to information technology and other more advanced media platforms, radio remains a critical source of information, current affairs and entertainment. SABC Radio commands a healthy 72.1% share of radio listening in South Africa. This translates to 28.2 million adults who choose SABC radio stations as their source of news and information every week.

Ms Yolande Van Biljon, SABC Chief Financial Officer, presented the financial information indicating some of the risks for this financial year:
- Budgeted revenue growth is more than the past three-year average and might not be attainable
- Possible litigation has not been factored, especially from long outstanding creditors
- Contingencies have not been considered in the budget
- Risk of expenses increasing more than the 5% anticipated, increasing net losses further
- Infrastructure has not been maintained and potential breakdowns could create unforeseen expenses
- Declining audience share due to lower investment in content in the past financial years
- Ban of alcohol advertisements and introduction of sugar tax, and
- Lack of capacity to implement Capex plan.

Uncertainties were:
- Approval of government guarantee application
- Implementation of Capex Plan Over The Top (OTT) will yield savings in signal and distribution costs.
- The new television channels to be created through DTT migration have not been factored in the budget
- Disposal of non-strategic assets
- Quantum and pace of the staff optimisation process
- Revenue from new strategic initiatives has been adequately identified and quantified
- Displacement cost for sport events not yet committed but likely to be broadcast have not yet been factored
- Staff optimisation has not been factored in the base budget due to uncertainties in implementation timing. It is only factored from 20/21.

Over the years the growth in personnel costs has trended with the growth in advertising revenue. The same relationship can be noticed with content amortisation, albeit slightly subdued. This erodes any upturn in future performance as this trend is forecast to continue without staff optimisation.

She also commented on the impact of the proposed legislative changes that assuming a R4,3 billion loan (government guarantee), repaid by 2026/27 financial year (with a three year repayment relief moratorium); equity would strengthen exponentially, positive solvency and current ratio by 2021/22 financial year, legislative changes (must carry re-imbursement, zero rated TV licence fee, reduction in signal & distribution costs) and Without the legislation changes, the entity will make a cumulative net loss of R1,5 billion over the three budget period, compared to a cumulative loss of R141 millions.

Net losses attributes were driven by:
- Sport rights budgeted at R404 million whilst sport sponsorship revenue is budgeted at R66 million and estimated classic advertising of R100 million – loss of R238 million
- R25 million for elections broadcasting
- Negative ROI (return on investment) on entertainment content R50 million
- Marketing cost increase of R110 million (> 200%) to 3% of Revenue.
- SIU budget of R10m
- Other operational expenses increase by R98 million - maintenance and repairs driven
- Finance cost on long term loan

Discussion
Ms Van Damme said that the current Board and management were not responsible for the dire financial position of the SABC. They are good people and should be thanked for staying at the SABC. Gratitude must go to the four Board members who stayed when the board did not quorate. She was pleased to see the improvements that have taken place. She would like to see more investment in local content but she demonstrated some leniency due to the fact that the funding was not yet at the optimum level.

She suggested that perhaps Members should be provided with the business model so that they are privy to it. As for the retrenchment, she would like an update on that and salaries not being paid – these affect lives, it is not just about numbers. She asked for an update about when Day Zero is anticipated to come.

The country cannot afford a bailout at the moment and right now the SABC would rather be trusted with a guarantee. The Board and management need to earn the trust through a guarantee.

Ms Kubheka said that having 73% dominance on the radio side makes SABC a monopoly, so how does it utilise its dominance in that space to support its financial viability. What are the plans to cover lost viewership? How is SABC planning to enhance the quality of programming to grow African languages?

Ms Z Majozi (IFP) said on the APP, will the Members get a comprehensive report on the rehabilitation process. This is at the high level and there was no adequate explanation about rehabilitation.

Mr Madisha said that he was still confused about the state of the SABC. He was still clueless about the SABC’s state of readiness and indicated that there is a contradiction in what was presented.

As for the reallocation of staff to other areas to generate revenue, can the delegation explain this? The CFO said that government contributions were slow but the SABC is said to be growing. He asked the delegation to explain comprehensively where the problems are.

Mr Molala said that SABC sits with a R1.9 billion debt; but when one listened to the presentation, only positive things were said. Firstly, in one presentation there was information about commercial part of the SABC which was said to be confidential. Hopefully, Members would be furnished with this information. It would be in the public interest to know.

On the three pillars presented by the Board Chairman, he was interested in the first one which talks to the legacy and governance. There were also a number of reports that the Chairman mentioned – what was the level of damage in terms of human capital and how many people were implicated and charged? There are so many reports relating to the SABC and Members would appreciate a more detailed analysis on what has transpired since the issuing of those reports.

Ms Mthembu asked what can be done by the SABC to identify opportunities for growth while it was waiting for financial assistance from government.

SABC Board Chairperson, Mr Makhathini, responded that indeed there is a crisis at the SABC but the reason it does not seem quite conspicuous in the financial information is because of the competent staff that have ensured that for the past 12 months the SABC has been flowing. Secondly, the expenditure on a monthly basis far exceeds the revenue but management has tried to manage the expenditure.

The biggest issue is that the funding model does not speak to the business model. Owing to the unfunded mandate, it is putting a lot of strain on the profit and loss (P&L). In the next three years the SABC will spend R6.8 billion and in the past three years it has spent about R4.8 billion.

The lack of investment in local content poses a threat. Clients and agencies highlighted this during a meeting that took place yesterday. We have 19 radio stations and five TV channels but the content on those platforms is not interesting enough to gain eyeballs and consequently increased revenue from advertising.

The other concern that the Board is looking into are the legacy challenges and it is important for Members to note that the SABC was not profitable in the past ten years, and the only years it was profitable was 2012 and 2013 when it was not investing in local content. Substantial investment in local content is required to generate revenue. The Board is currently addressing the legacy matter of irregular appointments and engaging with the relevant stakeholders.

Salaries are a big issue and we have prioritised it has a line item, but by so doing it takes away from investing in local content and we cannot pay our suppliers. Not all is well, but the reason we have kept it going is due to the competent staff.

Ms Van Biljon said that the three-month projections do not indicate that the SABC would not be able to pay salaries, but we are unable to invest in content, marketing and carry out critical maintenance and repairs on infrastructure. The success of the funding intervention is a key component of the corporate plan. Without the R3.2 billion, we cannot execute any of the numbers in the plan.

On the rehabilitation and renewal, the team will come back to Parliament and brief Members in detail on the rehabilitation process.

On the government grants, the grants are for specific programmes such as education, Channel Africa and production programmes. It is an engagement between the SABC and the Department where specific items are identified and we secure funding for those items.

Mr Craig Van Rooyen, SABC Chief Operating Officer, replied about generating revenue from other areas, that about 48% of SABC revenue goes towards salaries and the world benchmark sits at around 23% on percentage of revenue. To break even in that area, we either push up the revenue or reduce the staff.

So repurposing the staff in certain areas of the business includes training them on 4IR and digital. We are focusing on creating value for paying one’s TV licence and most people do not pay their TV licence because they feel like they do not receive value but we are building digital applications behind the wall such as gaining access to digital news, podcasts and music on the day. If you put in your TV licence number, people would gain access to all the digital aspects of SABC. This is where we will be repurposing people.

On radio, there is a specific focus on increasing revenue under the current operations strategy. This strategy will robustly focus on creating new opportunities for events for radio stations. New packages are being created in conjunction with commercial enterprise partners. We are also closing the huge cross-functional gaps within the SABC to increase revenue but we are finding that the behaviour of people listening to radio is moving online. We have plans in place and some of them require investment.

On losses to TV viewership, most losses relate to content over prime time. This is where our competitors such as eTV and DStv make most of their money and they are spending on content and if they have more compelling content, the viewers will move away. Currently, the SABC enjoys the top three programmes in the country under the conditions it operates but it is not sustainable to maintain those top three audiences which include Muvhango, Skeem Saam and Uzalo.

On enhancing quality for the African market on African stations, the SABC caters for all South African languages including the Khoi-San language. We are moving our associated websites into the vernacular and people can start accessing and enjoying the benefits of the online podcasts.

On radio stations, we are focusing on brand association – if you lose the brand, you lose the audience. We have learned a lot and received feedback on linear radio stations as well as TV through social media and we take that information and do something about it.

From a cost perspective, there is a focus on the cost of certain content such as sport content and to ensure that we are transparent on the content we buy. Lastly, on commercial growth opportunities and confidentiality, we will always be confidential because our funding comes from a competitive environment which is DStv and eTV. If a lot of those trade secrets are out in the open, the competitors may pursue strategies that may be counter-intuitive to us.

Mr Mxakwe provided a quick update on the funding for the SABC saying that whenever an application is made for a guarantee it is usually expected to be premised on a credible plan. Therefore, government would need to be persuaded by the turnaround strategic plan. The Board had concerns about the SABC plan; we need to come up with a strategy that speaks to all the issues at SABC. We need a strategy that will outline how technology has impacted on the business which means that the strategy must also speak to future advancements in technology. In that way we will be creating a new business model.

The Broadcasting Act touches on the distinction between the public and the commercial mandate of the SABC and it continues to say that the SABC shall account for these differently and the commercial mandate will subsidise the public mandate. The preliminary information at hand is that that subsidisation has not occurred; in fact it may be happening the other way round. In relooking at the business model, we need to refine the public mandate and how it is funded. Therefore, a new organisational structure may need to be formulated. This is where the employment of GTAC came in and that plan should be ready by September. This means we might have a unique guarantee application.

South African Post Office (SAPO) 2019/20 APP
Mr Mark Barnes, SAPO CEO, noted some key catalytic initiatives and projects relating to the Fourth Industrial Revolution:
- SAPO Pay Platform – Launch the electronic payment and digital money platform
- SAPO Mobile App – Launch the Mobile App to give customers greater access to digital channels
- Upgrade the IT Network – Implement the upgrade of the IT Network infrastructure to increase stability and improve customer service turnaround times
- Motor Vehicle Licence (MVL) App – For faster turnaround times on licence renewals
- e-Mall – Launch of the e-Mall platform for e-Commerce trading by SMMEs
- Sign MOU for eCom@Africa, and
- Postbank Corporatisation – Transfer of assets to Postbank subsidiary. Fast-track the banking licence application with the Reserve Bank.

On financial performance, the USO subsidy has been reinstated for the public service mandate with R1.5 billion allocated over the medium term and R474 million allocated for 2019/20. As a quarterly report, revenues increased by R1.2 billion (SASSA – R564 million, DTT – R243 million, Postbank interest – R143 million, Sales Initiatives – R312 million, Tariff – 8%); retention of customers and volumes. Expenditure increased by 9% due to staff, transport, and IT. Cost optimisation would be undertaken to match lower revenues. In terms of capital and funding, the following were reported:
- Capital Budget of R826 million in 2019/20 for investment in IT and property infrastructure
- MTEF submissions from SAPO: continuous funding for the universal service mandate, borrowing limit for unsecured, project specific funding for capital projects and entering an era of PPPs
- Capital Project funding of R1 billion for 2020/21 will be funded from SAPO own reserves and supplemented with borrowings (project based borrowing)
- The financial turnaround is premised on capital expenditure in the growth of the business, staff rationalisation (part of cost containment) and rebalancing of the branch network.

Discussion
Ms Van Damme said that her preconceived perception of the Post Office is the more traditional form of communication. It was refreshing to hear the state entity looking into new opportunities, such as the renewal of licence applications being done online. She wished the Post Office best of luck. Members felt that the Post Office was moving towards a positive and innovative direction.

Ms Kubheka asked if the Post Office planned on bringing in new talent into the organisation that will assist in moving towards the Fourth Industrial Revolution.

Mr Molala expressed some satisfaction with the new technologies that the Post Office will bring on board. He said that most of the people that make use of Post Office may not necessarily be technology savvy, so how does the Post Office plan to maintain a balance to ensure that those people are also catered for?

The Chairperson indicated that a change in the culture of an organisation requires a partnership buy-in.

Mr Barnes replied that the change in technology does not necessarily translate to the reduction of personnel. There are places in India where people have stokvels and transfer money via cellphones. For the most part technology almost favours the rural spaces because it provides connectivity that would otherwise not be there. Technology will not necessarily negatively affect employment.  

ICASA 2019/20 APP
Dr Keabetswe Modimoeng, Acting ICASA Council Chairperson, reported that the IMT Spectrum licensing project was initiated in 2016 for 700 MHz, 800 MHz and 2.6 GHz bands but was later interdicted. The process was currently underway for promulgation of a Policy Directive by the Minister and ICASA was working on its state of readiness to commence the licensing process once the Policy Directive was issued.

As for the Data Services Market Review, a multi-year project initiated in 2016/17 in response to “DataMustFall”, the target this year was a Findings Document of the market review inquiry. The process would run parallel to the Data Market Inquiry undertaken by the Competition Commission

ICASA’s 2019 Elections Report will be published during Quarter 3 on monitoring of elections broadcasting, political advertisements and equitable treatment of political parties by broadcasting licensees.  

On budget reductions, ICASA’s request to retain its 2017/18 R10.2 million cash surplus was declined by National Treasury and it was transferred back to the National Revenue Fund before 31 November 2018. On 13 December 2018, ICASA received a revised Mid-Term Expenditure Framework (MTEF) budget allocations letter which stipulated that its budget allocation was reduced by R26.67 million (R8.596 million in 2019/20, R8,888 million in 2020/21, and R9,186 million in 2021/22) over the MTEF period. This decision means that ICASA is facing serious financial constraints. The budget reduction left it with a huge budget deficit which will have a negative impact on implementation of Annual Performance Plan and Strategy targets.

In conclusion, Dr Modimoeng said that as a risk factor the funding model of ICASA is not optimal. As a result it is not able to effectively execute its mandate due to lack of resources (systems and people). As a regulator of the ICT sector, it is critical that ICASA be adequately resourced to keep abreast of technological developments. On policy, the delays in finalisation of the Policy Directive on the High Demand Spectrum may hamper its efforts to initiate and finalise the spectrum licensing process. It is of critical importance that policy is future proof, and will withstand the ever changing landscape of a technologically driven industry. Therefore, it should provide overall guidance rather than detailed instructions.

Discussion
Ms Mthembu asked why the funds were taken back by National Treasury.

An ICASA official explained that the funds were surrendered to Treasury because the procurement policies were not finalised by ICASA on time and the balance at the end of the financial year was required to be returned to Treasury.

Ms Van Damme said that it is in the public domain that ICASA says that it is waiting upon the issuance of the policy directive to commence spectrum licensing. She asked for a specific timeline for when the licensing would be finalised.

Mr Modimoeng replied that by law ICASA is required to receive the policy directive from government and it must be considered before proceeding with the licensing. In terms of timelines, the bulk of that response is based on what will be contained in the policy directive. If whatever is contained in the policy directive is such that it requires the licensing of new entrants, we need to follow a very detailed licensing process which could take months. The sooner the policy is finalised, the better because it would help ICASA to embark on the licensing process as soon as possible and the release of spectrum would be somewhere in the third quarter of 2020. Hopefully, the process will not be litigated as well.

Mr Molala suggested that in the future engagements with the entities the Committee discuss more the funding model of the entities because it appears to be a common challenge with the entities.

Ms Van Damme asked for an update on the Rubben Mohlaloga’s matter.

Mr Modimoeng replied that on the last day of the Fifth Parliament, the resolution was taken to remove Mr Mohlaloga. He is no longer serving on the Council of ICASA.

Sentech Annual Performance Plan
Mr Itumeleng Segaloe, Sentech Chief Strategic Officer, reported that Sentech’s focus would include:
- Growing the broadband business from R9 to R40 million revenue in 2019/20 and to R250 million by 2021
- Accelerate Sentech’s business mergers and acquisition strategy execution
- Continue and increase prospecting on the Pan African market for new business which started this year with one customer, Botswana BOFINET
- Inculcate a culture of innovation by introducing an innovation challenge; develop drone technology monitoring for remote transmission sites; encourage staff to work on their ideas and provide them time to implement lean start-up methodology and champion 4IR through initiatives that Sentech will start this year.

Films and Publications Board (FPB) 2019/20 APP
Dr Maria Motebang, FPB Acting CEO, highlighted that its target for its safety and security strategic objective included the FPB Amendment Bill which covers the criminalisation of “non-consensual image sharing” (revenge pornography). The Bill awaits the President’s assent. The Bill also makes provision for an enforcement function to strengthen the regulatory ‘teeth’ of the FPB. As a target, 100% of child sexual abuse material cases referred to the FPB must be responded to within 10 working days. FPB had committed to spend 40% of all procurement on South African youth over the MTEF 2019-2022.

.ZADNA 2019/20 Annual Performance Plan
Mr Vika Mpisane, .ZADNA CEO, reported that under Programme One, the registration event seeks to stimulate the number of new domain names above the average annual growth of 54 000 new registrations per annum. This will be done through events intended to promote .ZA registrations. The events will likely be held in collaboration with some of the South African registrars and/or resellers.

Under Programme Two, .ZADNA and the Department are conducting the Registrar-Reseller Development Training programme. The programme is intended to increase participation of startups and Black-owned enterprises in the provision of internet services, especially in the domain name registration value chain. So far three out of 12 registrar reseller trainings have been completed.

For Programme Three, so far two out of nine Internet Governance engagements have been completed.

USAASA (Universal Service and Access Agency of South Africa) APP
Mr Sipho Mngqibisa, Acting USAASA CEO, In terms of programme one which focuses on optimally functioning and mandate delivery; under compliance, sound financial management and internal controls, 100% of valid invoices were paid within 30 days from date of receipt.

On programme two, under improved quality of reported APP performance; USAASA maintained zero material findings in terms of financial performance.

USAF (Universal Service and Access Fund) Annual Performance Plan
USAF noted past achievements before its APP briefing. It achieved 66.67% of its target to increase access to digital broadcasting services via installing set top boxes to qualifying needy households. For the roll-out programme to provide access to connectivity of electronic communication, 70% of its target was achieved.

Broadband Infranco
Mr Andrew Matseke, Broadband Infraco CEO, outlined the organisation’s alignment with national outcomes, shareholder and State of the Nation Address priorities, its strategic goals and quarterly targets for 2019/20.

SITA
Mr Ntutule Tshenye, Acting CEO, said SITA has implemented the e-Government Portal that serves as a single point of entry to government’s electronic services and over 10 000 people are registered on the portal. To date SITA has implemented more than 100 eServices in the value chains of government enterprise productivity and government business solutions, demonstrating clear socio-economic value to the citizens. Digital transformation trends that SITA will explore to improve public service and enable citizen convenience include: automation, connectivity and mobility, internet of things, data collection and analytics, security and protection; and digital government platforms.

NEMISA Annual Performance Plan 2019/20

Mr Phuti Phukubje, NEMISA Acting CEO, spoke on the organisational environment stating that NEMISA, in collaboration with government, education, business and civil society, is delivering e-astuteness to ensure that South Africa improves its e-readiness rankings and progressively develops a vibrant Digital Society and Economy. The Institute has demonstrated its ability to implement a national digital skills agenda through its globally recognised decentralised model of Co-Labs.

There are currently eight provincial digital skills CoLabs situated at Public Higher Education Institutions.

Each CoLab delivers against a national thematic area to support national programmes and policies and is responsible for:

a) Focused implementation of the digital skills programme whilst also ensuring theoretical underpinning and soundness of initiatives;

b) Interpretation of the national digital skills agenda into provincial agendas;

c) Strengthening and/or establishing new relationships for collaboration on provincial level;

d) Providing feedback in terms of provincial considerations (objective, needs, challenges, and achievements).

He further noted that rapid advancements in technology heralded the Fourth Industrial Revolution (4IR). Society is on the brink of a technological revolution that will alter the way people live, work and relate to one another. South Africa has a shortage of digital skills capacity and this limits the socio-economic development and competitiveness of the economy. This shows that South Africa is still not ready (e-ready) for full inclusion into the emerging Digital Economy and Information Society.

The Chairperson thanked everyone and assured them that more fruitful engagement with the entities would be scheduled for a later date. Due to time constraints, the Committee could not entertain or rather engage with all the entities today. However, the Committee appreciated the presentations.

The meeting was adjourned.

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