DoC Budget Presentation to Portfolio Committee on Communications Dr. A.A Ngcaba DG Communications 22 October 2002

Outline Introduction 2001/02 Review Policy priorities Strategic alignment to national objectives MTEF Budget Challenges Closure

2001/02 Review Achievements Outline Introduction 2001/02 Review Policy priorities Strategic alignment to national objectives MTEF Budget Challenges Closure

2001/02 Review Achievements Policy and legislation Telecommunications amendment Act – Dec 2001 E-Bill Cabinet approved that: - SABC be governed by charter to be monitored by regulator - SABC be restructured into a PBC and CBC - SABC become a limited liability company owned 100% by Government Establishment of a Postal Regulator

2001/02 Review (continued) Service delivery Developing programming for - women - people living with disabilities - people living with HIV/AIDS 100 PIT’s rolled out 7 citizen’s post offices officially launched 9 community radio production hubs launched Appointment of mystery shopper – to monitor adherence to standards by SAPO

2001/02 Review (Continued) Others Human Resources development Establishment of Digital and production advisory body Initiating and coordinating a national KM debate Promoting awareness of KM in all government tiers Human Resources development 51 % employees women (40% ex PDI) 26 woman graduates in networking engineering 13 woman graduates in masters in software engineering 14 graduates in Masters in engineering

Policy priorities Outline Introduction 2001/02 Review 2002/03 Budget process Policy priorities Strategic alignment to national objectives MTEF Budget Challenges Closure

Policy Priorities Telecommunications Broadcasting Policy developments have budgetary implications Policy Priorities Telecommunications Electronic commerce and transactions Bill Broadcasting Broadcasting amendment Act

E-Bill Predictable legal and regulatory environment pre-requisite for e-commerce Connectivity and access to internet infrastructure and services Secure financial environment - cryptography E-Awareness across economy Digital skills or e-literacy Support for SMME’s National E-Strategy Domain naming Authority

Amendment to Broadcasting Act Restructuring of SABC - PBS and CBS Progam content development Repositioning Channel Africa Corporitisation BOP ICASA – regulatory framework for developing local content ICASA – regulatory framework for licensing pay television services

Amendment to Postal Services Act Positioning SAPO as a bank of choice for the unbankable Universal service access Rollout of postal infrastructure Restructure Post Bank Citizens Post Offices – affordable access to digital services

Strategic alignment to National objectives Outline Introduction 2001/02 Review Policy priorities Strategic alignment to national objectives MTEF Budget Challenges Closure

Strategic alignment to National (Objectives) Contributing to economic growth and foreign direct investments SMME, BEE, Gender and empowerment of people living with disabilities Universal Service and access Infrastructure rollout Research and development Human resources dev. Contributions to - Social sector and service delivery - Contributing to ISDRS - ISDP & Urban renewal

Economic Growth & Foreing Direct investments Repositioning Sentech – launching of International Gateway Telkom listing on JSE – 8 – 14 billion raising capital SNO – Investment of $200 million per year for five years Restructuring Post Bank – infrastructure to service rural communities Regional broadcasting services E-Bill – projected increase in business conducted over the internet B2B estimate at R3,2 billion in 1999 to R207 billion in 2005. B2C estimate at 2,6 billion in 1999 to 34 billion in 2005

SMME’S, BEE’S (including gender and people living with disabilities) ICT Business incubations project Strategy for DOC & Portfolio organizations Under-serviced area licenses Licensing of regional broadcasting services SNO – 19% earmarked for BEE Restructuring Post Bank – community based savings schemes

Universal Service and Access Regionalisation of SABC – increase coverage and extend services to regions Establishing policies on programming content Channel Africa/BOP restructuring SAPO increase in retail outlets Post bank – banking services to the poor Telecoms infrastructure – to areas where tele-density is less than 5% Roll out of e-mail address

Infrastructure roll out Space applications systems Increase in postal retail outlets Licenses for SNO Regional broadcasting services Telecoms infrastructure – license obligations of Cell C Licensing of 8 operators to provide telecoms services in under-serviced areas Licensing of Sentech for the International Gateway Analogue to digital broadcasting ICT university – capital requirements

Research and Development Space applications systems Software development at ISSA in SA languages – Tsonga, Venda, Ndebele etc,. Next generations systems Object orientated systems Embedded systems Proprietary systems Websites development – Mbambatha rebellion, June 16, Sharpville 21, etc.

Human Resource Development Establishment ICT University Develop e-learning centre for research and content development - DOE Establish edunet – e-learning to upgrade teachers Learnership programmes with ISETT SETA – incubators and ISSA R90 million over 3 years Skills development – multi media broadcasting at NEMISA

Social sector and service delivery Moral renewal: Content development and programme production – fostering community responsibility for fighting crime Moral renewal: Internet – policies aimed at addressing pronography, child abuse, etc on internet Moral regeneration summit: SABC and community radio participation Broadcasting educational content on SABC Telecentres, rollout of broadcasting services, e-learning centre, MPCC’s, etc

Justice crime prevention & Security Sector 112 Emergency center Interception and monitoring bill – justice E-Bill (cyber inspectors) Strategy to combat crime esp, drug trafficking

ISDP AND URBAN RENEWAL PLAN Roll out of ICT infrastructure in nodal points Development of digital educational content Extending addresses to under serviced areas

MTEF BUDGET Outline Introduction 2001/02 Review 2002/03 Budget process Policy priorities Strategic alignment to national objectives MTEF Budget Challenges Closure

4. Funding requirements 2002/03 2003/04 2004/05 Options Total Baseline allocations 443,220 m 464,736 m 492,620 m 740,472 m 996,231 m 1 013,156 m 1 183,692 m 1 460,967 m 1 505,776

Funding per program Program 2001/02 R’ m 2002/03 Administration 63,296 63,708 Telecoms Policy 135,844 117,190 Postal Services 645,362 344,502 Broadcasting 299,055 292,959 Auxiliary Services 5,753 5,092 TOTAL 1 149, 310 823, 451

Transfer Payments Transfers 2002/03 R’ m 2003/04 R’ m 2004/05 R’ m Infrastructure (MPCC’s, PITs ) 10,000 10,480 Training (SETA, UOS) 10,050 2,104 2,350 Emergency Call Centres 20,000

Transfer cont’ Transfers 2002/03 R’ m 2003/04 R’ m 2004/05 R’ m USA 10,711 11,211 11,884 USF 23,679 24,745 26,230 SAPOS 300,000 Broadcasting (Program content Children, youth, aids, women, disability) 29,000 31,500 33,390

Transfers cont’ 2002/03 R, m 2003/04 R, m 2004/05 R’ m SABC – PBS 42,930 44,717 47,400 SABC – TBVC - Channel Africa 26,450 26,288 27,865 Community Radio 8,500 9,000 9,540

Transfers cont 2002/03 2003/04 2004/05 ICASA 111,190 116,376 123,359 NEMISA 13,203 13,753 14,578 Sentech 54,000 -

BUDGET SHORTFALL DESCRIPTION REQUIRED APPROVED VARIANCE E-business 30,669 10,000 (20,669) ICASA 52,647 (42,647) Broadcasting 120,000 - (120,000) Other 18,186 (18,186) TOTAL 221,502 20,000 (201,502)

Challenges Outline Introduction 2001/02 Review 2002/03 Budget process Policy priorities Strategic alignment to national objectives MTEF Budget Challenges Closure

Challenges Limited financial resources Splitting assets of SAPO- post bank and post office Issues to be resolved Repositioning - Rightsizing - IT outsourcing - Pricing - Relocating - Streamline operations - Sale of business Limited skills

Thank you