DA calls on Minister Cwele to come clean on Broadband Infraco
22 April 2015
The DA calls on the Minister of Telecommunications and Postal Services, Siyabonga Cwele, to immediately provide clarity on the future of Broadband Infraco to Parliament, including how this entity will be funded after September 2015.
This follows a presentation to the Portfolio Committee by Broadband Infraco CEO Ms Phuleng Kwele and Chairperson Mr Mandla Ngcobo.
In the presentation of its business plan for the 2015/2016 financial year to the committee, it was revealed that Broadband Infraco only has sufficient funding to carry on trading until the end of August 2015, after which it will have no funds to continue operating.
In the overall budget of the Department, there is no line item for any funds allocated to Broadband Infraco.
It is imperative that the entity has clarity on its funding in order to protect its assets, provide assurance to its customers, and secure its place as a pivotal player in the rollout of broadband connectivity nationwide.
Responding to questions regarding continued funding for the entity or whether current discussion around the rationalization of state-owned companies will have an impact on this state of affairs, the Deputy Minister of Telecommunications and Postal Services, Professor H.B. Mkhize, was unable to provide any specific answers, including whether the entity would be sold or its business merged with another.
With assets valued at approximately R2-billion and a national fibre optic network covering more than 17 000 kilometres, the company remains a critically important component of the government's SA Connect programme.
Additionally, its primary customers, including the SITA (State information Technology Agency) and CellC that depend on this entity for its network operations, and require certainty as to the entity's continued financial solvency.
A Cabinet turf war eight years ago resulted in Broadband Infraco’s activities being hobbled by its licence conditions that prevent it being competitive in the market. This has contributed in large measure to its current financial crisis. Broadband Infraco should not be left to wither and die because of continued Cabinet dithering on its future. It must immediately offer it for sale to the private sector so it can continue operations.
Statement issued by Cameron MacKenzie MP, DA Shadow Deputy Minister of Telecommunications and Postal Services, April 22 2015
