Department and NEMISA Strategic Plans and Budget: briefings

Meeting report

COMMUNICATIONS PORTFOLIO COMMITTEE
12 April 2005
DEPARTMENT AND NEMISA STRATEGIC PLANS AND BUDGET: BRIEFINGS

Chairperson

Strategic Plan 2005 - 2008 Department of Communications and Presidential National Commission on Information Society and Development (PNC on ISAD): PowerPoint Presentation
Communications Department: Strategic Plan 2005-2008
National Electronic Media Institute of SA Strategic Plan: PowerPoint Presentation
Final version of ICT Charter
Department Annual Report 2003/04 available on DOC website

ICT website: http://www.ictcharter.org.za

SUMMARY
The Department's briefing focused on the provision of the universal access to telecommunication services to all South Africans irrespective of where they lived. The Department had been looking at ways of lowering the price of telephony in South Africa. Challenges faced by the Department included commercialisation of the Post Bank and lowering input costs to attract investments such as call centres to the country. Members concerns included liberalisation of telecommunications and the lowering of telephony costs, accountability of State Owned Entities, the increase in the money utilised for personnel and the accessibility of telecommunication services in rural areas.

The National Electronic Media Institute of SA briefing on its strategic plan highlighted its goal to train more individuals for the broadcasting industry, utilise the learnership programme and generate new revenue streams for the organisation. Challenges included reinvestment in technology so as to be the training leader in the industry. Members asked why the number of trainees had not been increasing and were concerned about the huge sums that were spent on consultant fees.

MINUTES

Department briefing
Ms Lyndall Shope-Mafole, Director-General, outlined the Department's 2005 - 2008 Strategic Plan which focused on the key contributions it could bring to meeting the national strategic objectives, lowering the cost of telecommunications and reducing the cost of doing business in South Africa. Challenges facing the Department were the digitisation of the electronic communications network. The department had been striving to commercialise the Post Bank so that it could be the bank of choice for most South Africans and to reposition the Post Office to be accessible to most South Africans. The convergence of technologies would enable more operators to enter telecommunications such as the use of Voice over Internet Protocol. She explained that the mandate of the Presidential National Commission on Information Society and Development (PNC on ISAD) was to facilitate the development of an inclusive information society in South Africa and the rest of Africa. Its strategy involved improving the capacity of e-Governance, implementation of the e-Education policy especially in the field of Maths and Science and improving connectivity of health care centres.

National Electronic Media Institute of SA briefing
Mr S Molema, Executive Director, briefed the Committee on its strategic plan which included training more individuals for the broadcasting industry and generating new revenue streams for the organisation. It showed how its budget had been spent in 2003/04 and how its previous revenue streams had decreased. Key milestones had been the delivery of the Television Production Learnership and the launch of the Language and Heritage Portal. The institute was able to air radio documentaries on 13 stations and had provided trained TshiVenda and XiTsonga newsreaders for the SABC. Challenges facing the Institute included increasing the number of learners per year, finding other means of generating revenue, securing jobs for graduates after completion of training, building management capacity to move the organisation forward and reinvestment in facilities so as to be the training leader in the industry.

Discussion
Ms L Yengeni (ANC) asked how the requested extra R35 million for personnel was going to be used.

Mr Harry Mathabathe, Chief Financial Officer: Department of Communications, replied that personnel costs had been R66 million in the last financial year but there were still many vacant posts which had to be filled.

The Director-General replied that the new posts were a result of new units that had been established within the Department such as the unit which dealt with broadband and new technologies and another which dealt with International Affairs, Intergovernmental Relations and Africa in particular. Previously that directorate had dealt only with legislation and administration.

Mr P Mulder asked why the South African Post Office wanted an increase in its budget.

The DG replied that the Post Office had to open more outlets and employ more personnel to ensure access for all citizens.

Mr M Mohlaloga (ANC) asked where would the two regional television stations be situated. He wanted to know about the nature of problems at Sentech. What plans the Department had in place to lower the cost of telephony in South Africa and how was that linked to the unbundling of the Local Loop? He asked about the progress on the launch of a national youth radio station and what progress had been made in the liberalisation of telecommunications in South Africa.

Mr Joe Mjwara (Deputy Director-General, Policy Development) replied that the location of the regional television stations would be determined by availability of infrastructure and services such as production houses. The South African Broadcasting Corporation would make the final decision on where such stations would be situated

He agreed that there were problems at Sentech; for instance, the Chief Financial Officer had been suspended. The reasons for the suspension were not made public due to internal processes being followed at Sentech. The Sentech board had been changed only because their term of office had come to an end.

Ms Lyndall Shope-Mafole explained that there were areas of the local loop which could be unbundled while others required huge investments. The Department still has to work out a policy decision on the issue. She added that some countries that had liberalised their telecommunications had found that it had not resulted in lower telephony costs but that some countries that had not liberalised had lower telephony costs.

Mr Mjwara said that the tariff reduction programme would be reviewed as a means of lowering the cost of telephony. The SABC was mandated to take up the matter of a national youth radio station.

Mr P Pongwana (Deputy Director-General: Innovative Applications and Research) noted that people should look at what had happened since 1994 when they were talking about lowering the cost of telephony. The Department had to look at lowering this either at the retail level or the wholesale level. When British Authorities had unbundled the local loop, new operators had invested huge sums of money and only one of them survived. It took Britain eight years to unbundle the local loop. Unbundling the local loop does not always result in lower costs.

Ms Nkuna (ANC) commended the department on the launch of TshiVenda and XiTsonga news bulletins but said that more needed to be done to give minority languages an equal footing with other languages. She asked why there were few South African animation programmes on television since it was such a useful educational tool.

Mr S Molema (Executive Director, Nemisa) explained that Nemisa's role was to ensure that South Africa had a pool of skilled personnel from which broadcasters could draw. The SABC and other broadcasters had a duty to ensure that the use of Xitsonga and TshiVenda were used increasingly. Animation in South Africa was embedded within the advertising industry. The MAPP SETA (Media Advertising, Publishing, Packaging Sector Education and Training Authority) had set up standards for animation training and they would then assess people on the basis of recognition of prior learning.

Mr Mjwara replied that few people were formally qualified in animation but a national organisation of animators would be launched soon to cater for the needs of this emerging profession. An exhibition of work created by animators would be held thereafter and a competition would be held to select those who can create animated South African stories.

Ms D Smuts (DA) asked how the Department would monitor the Information Communication Technology Charter. What had the Department done to ensure that government television programmes such as those that showed economic opportunities were shown on SABC television stations? What had happened to the free SIM cards that were promised to indigent people by the cell phone operators. She pointed out that government had a stake in Telkom and in the Second National Operator through Transtel and Eskom. How would the Department reconcile the Government's relationships with the two competing players?

Mr Mjwara replied that the Department respected the independence of the SABC in and could not dictate which programmes to play and when. Five million SIM cards would be issued and there were only 250 000 cell phones available. The problem was how to distribute the cell phones. If, for instance, they were to be given to rural people, would they have access to a mobile network or not? Mobile operators, the Independent Communications Authority of South Africa (ICASA), the Department and the Universal Service Agency (USA) were going to work on an implementation plan. The ICT Charter had been initiated by a working group and then a steering committee had been elected. The steering committee met every Wednesday to sort out problematic issues such as the role of Black Economic Empowerment and foreign-owned Multinationals. The Charter would be made available to the public for comment and the final version would be used as a scorecard for monitoring purposes.

The DG commented that South Africa was a developing country which could not afford to let State Owned Enterprises (SOEs) operate as they wished. It was the duty of the State to ensure that entities such as Eskom fulfil their mandates hence government-owned shares in those entities.

Mr R Pieterse (ANC) asked what the Department had done to increase the footprint of all television stations to all regions. What measures were taken by the Department to increase the capacity and services of the South African Post Office in rural areas? He referred to the dysfunctional Public Internet Terminals (PIT) in the Postal Agencies and Post Offices. Why did South Africa experience skills shortage while Nemisa was meant to address that?

Mr Mjwara replied that digitisation of radio and television would increase the footprint of both mediums significantly providing nearly 100% coverage.

Ms Ntombela Nzimande, Deputy Director-General: Strategic Policy Coordination, Integration and International Affairs, replied that the fact that some PITs were not working had to do with shifting the mindset of Post Office workers. The postal workers were trained to sell stamps and post letters and parcels, the introduction of new technology was not accompanied with comprehensive training.

The Chairperson commented that most Post Offices around the country had no email, Internet or fax facilities while the rest of the world was living in the information age. He urged the Department to upgrade so as to meet present day needs other than letter posting.

Mr Kholwane (ANC) asked if it was possible to increase tele-density within a period of eight months. Would the increase in personnel result in less money spent on consultants, or would the Department continue to rely on consultants? He enquired about the type of oversight role exercised by the Department to ensure that SOEs fulfilled their mandate.

Ms G Grabe, Chief Operations Officer, replied that money spent on consultant fees had been dropping and that money would be used to fill the vacant posts. SOEs were required to submit Quarterly Reports to the Department for oversight purposes.

Mr P Pongwana replied that South Africa had more than 20% ‘teledensity’, but the majority of people used cell phones because it was cheaper.

Ms L Yengeni (ANC) reiterated the question on how the Department performed its oversight role to ensure that SOEs were accountable. Were there any monitoring systems in place and how did they work?

Mrs Ntombela Nzimande replied that the Department met with the SOEs bi-monthly for oversight purposes and to sort out problems that hindered service delivery.

Ms Grabe replied that the Department had Monitoring and Evaluation Systems that would show where the blockages and bottlenecks were, and then sort them out.

Mr Khumalo (ANC) asked why the Minister appointed the boards of SOEs while they reported to the Department. He asked what the Department done to ensure that township Post Offices were upgraded to be on par with their suburban counterparts, rather than to commercialise and expect the Budget to increase. He asked Nemisa why the number of people trained had not increased.

Ms Ntombela Nzimande replied that after the presidential State of the Nation Address each year, the Minister meets with SOEs for oversight and to align the SOEs programmes with the State of the Nation Address.

Mr Molema explained that Nemisa had been training people in electronic media in order to work or run their own businesses. Other companies outside the broadcasting industry recruited some of the people who had been trained.

Mr S Haasbroek (DA) commended the Department on the work they had done to the Post Offices in both urban and rural areas in KwaZulu Natal. He said that the good working relationship between the Post Office and local governments was a good model which be could replicated in other provinces.

The meeting was adjourned.