Minister on Department of Communications Strategic Plan 2011-2014

Meeting report

The Minister of Communications, Mr Roy Padayachie, addressed the meeting, explaining his vision for the development of the field of communications in South Africa between now and 2020. He situated this vision and anticipated growth within the broader developmental processes underway in South Africa, as well as global trends and events. A lot of thinking went into deciding on an approach towards the challenge of developing and steering the complex ICT Sector over the next few years. The context was important, because government would be investing in a very important project over the next few years. There was the need to develop a governmental system that was performance based and outcomes driven. This system would make it possible for the performance of office bearers and civil servants at all levels of government to be measured by the results they produced for the people. There was a need to stick to the truth, which was that government’s priority was to serve the people and to implement their mandates. It was an important principle which had to guide all the activities of government departments and it had to be the yardstick by which to measure success. This meeting was one of many events that would assist the Department to measure whether it was on the right track. Underlying all that was said was the acceptance of another important principle. This principle was that all government officials and civil servants needed to recognize the fact that they were accountable for their actions and deeds, to their colleagues, the relevant government structures and above all, they were accountable to the people.

The year 2011 was very important, because government at the local sphere had to account to the people in terms of what it had achieved during the last term. In May, all parties would go back to the people to get a mandate to restructure local government. It would bring into focus the need to continually renew the mandate from the people. The moment and the period during which this meeting was taking place, was important, because it took place in the buildup to the May elections. It was in that spirit, embodying of all those principles and giving recognition to all those values that the DoC was addressing the Committee.

The Minister was accompanied by the DoC team, which was rejuvenated. It had new inspiration and a mission with respect to service to the people. It had the desire to re-establish this department, ministry and sector as a place of pride within the government’s work. He was pleased that Mr Raymond Reddy, head of the Ministerial Office was present as was Dr Sharon Horton, his Executive Personal Assistant, Tiyani Rikhotso, the Ministerial Spokesperson, the Acting DG, Dr Harold Wesso as well as his team consisting of Deputy Directors and technical staff. The fact that all key personnel from the Ministry and DoC were in attendance, demonstrated how important the Ministry and Department considered the meeting. The presentation would show how much thought and effort went into the development of the Strategic Plan.

He wanted to focus on two things, which would serve as a backdrop to what the DoC would present. The first were strategic alignments which dealt with the definition of governmental priorities. It drove the entire programme of government. Government had decided what the outcomes where in terms of which it wanted to measure itself in a performance monitoring and management system. In relation to those outcomes, all Ministers had to sign a performance agreement with the President. In the performance agreement, all the outcomes were determined for which the Minister would be held directly accountable. The outcomes were driven by the relevant outputs. These outputs were specific targets, which had been determined for those outcomes. It was from these targets that the Department derived its strategic goals. In this sequence of events, the Strategic Plan occupied a very important position. The Strategic Plan over the medium term was the compass that guided the work. It defined the activities that the Department had to undertake in order to deliver the desired outcomes.

Certain tasks carried more weight than others. For this reason the Ministry and Department had determined six priority areas, or flagship programmes. These programmes would determine how the Ministry and Department would set the platform for the development of the ICT sector over the next few years.
The second conundrum was the dilemma of how it was possible to do this within the context of a five-year term of government, and how one did it without a conception of how the ICT sector was supposed to develop over the medium to long-term. The Ministry and the Department had to have a clear vision of what it wanted the ICT sector to be 20 years from now. South Korea was the No 1 ICT country in the world after 15 years of focused planning and development. This was possible with a clear vision. A country had to know where it was going. In government there was no consistent long-term benchmarking date. After consultation, the Ministry and Department decided that, for the ICT sector, the benchmark year would be 2020.

Towards this goal of 2020, there was a roadmap that mapped out developmental landmarks that the country had to achieve by certain dates, which it acquired from the international protocols for this process. There were some statistics that related to broadcasting digital migration (BDM) that targeted the year 2013. Then there was 2014 by which time South Africa would be expected to subscribe to some global commitment on Millennium Development Goals (MDG) and in the South African setting, in terms of World Summit on the Information Society (WSIS) there were certain international acceptances that South Africa had to achieve by 2015. Taking into account all these and other aspects, the Ministry and Department had decided on 2020.

The Department would give insight into the thinking that went into the planning for the creation of the platform to launch the sector into this medium to long-term vision. The details of this medium to long-term vision have not been developed. It would be developed collectively by all stakeholders. The idea was being introduced so that it could become part of the active thinking and discussion processes and agendas of stakeholders, including the Committee.

Director General's briefing
Dr Harold Wesso, DoC Acting Director General, DoC, introduced his team: Ms Rosey Sekese, DDG: ICT Infrastructure Development, Mr Gift Buthelezi, DDG: ICT International Affairs and Trade, Mr Norman Munzhelele, Acting DDG: ICT Policy, Mr Themba Phiri, Acting DDG: Presidential National Commission on Information Society and Development, Mr Sam Vilakazi, Acting DDG: Finance and ICT Enterprise Development, Mr Farhad Osman, Chief Director: Strategic Planning and Monitoring, Ms Pearl Seopela, Chief Director: Media and Communications.

The presentation contained 70 slides. Dr Wesso presented slides one to forty-seven. There were two annexures. Annexure A was a summary of the Strategic Plan. To contextualize the Strategic Plan, he needed to position it in terms of the national developmental plans for the country as well as international best practice. All the slides showed how the DoC was working towards alignment with other processes in Government. Mr Phiri would follow and talk about the newly developed South African e-barometer index. Government had produced an index to indicate whether its performance was improving or declining. Mr Vilakazi would present the financial information.

The Mandate of the DoC was to create a vibrant ICT sector that ensured that all south Africans had access to affordable and accessable ICT services in order to advance socio-economic development goals. Its Mission was to build an inclusive information society through a sustainable world class information and communication technologies environment. The Vision was for South Africa to be a global leader in the development and use of ICTs for socio-economic development.

Slide five referred to employment trends and how these had evolved since the 1800s to the present, comparing the fields of agriculture, services, manufacturing and informatics. Agriculture employed 80% of people in 1800 and only 10% at present. Manufacturing was also on the decline due to automation. Services and informatics were on the rise. The present world was an e-World. People referred to e-Health, e-Business, e-Government and e-Commerce. Some countries had moved beyond the e-world. South Korea was not talking about e-Korea anymore, it was u-Korea. Ubiquitous Korea. That was where the world was heading and that was where South Africa had to go as well. This was why the Minister was clear in stating the mission of the DoC was to prepare South Africa in terms of ICT for the world of 2020.

The building of the knowledge economy required more than just the provision of ICT infrastructure. It needed the services to support it. It also required institutions to develop it. Many institutions were still geared to serve industrial age economic activity. It had to re-orientate and re-design itself in order to be functional in, and advance the knowledge economy. Ultimately, the ICT sector had to serve people. It had to serve society, both in its urban and rural domains and everything in-between. Society depended on government institutions to get to the services, built on ICT infrastructure. The DoC was about socio-economic development, which was about people.

The 2009 report from the International Telecommunication Union (ITU), the leading United Nations agency for information and communication technology issues, indicated that to facilitate the building of the inclusive information society, there were three aspects to focus on. Firstly, the ICT infrastructure had to exist and people had to have access to it, creating ICT readiness. This accounted for 40% of the success. Secondly, people had to have the skills to use the ICT equipment and infrastructure, which accounted for 20% of the success. Thirdly, there had to be intensive usage of the skills and infrastructure, which accounted for the remaining 40% of the success. The DoC normally focused on infrastructure, which only accounted for 40% of the issue, ignoring skills and usage which accounted for 60%. It had to have this holistic view if it wanted to successfully build the inclusive information society.

What the DoC also had to understand, was that it was living in the world of Web 2.0 through the internet. This world consisted of Google, Yahoo, Mixit, YouTube, Twitter, Facebook, MySpace and other social media applications. If the DoC was only going to focus on the telecoms side of things, it was going to lose the battle to build the inclusive information society. This was why 2020 was so important. The DoC had to pose the question: “What was 2020 going to be like in terms of technology?” It had to actively build a regulatory environment for 2020. The DoC was trying to position the Department, not only in terms of the short term future, but also in terms of 2020. It was a bigger challenge, but the DoC dared to think that far in order to provide for the people.

This explained the context pertaining to ICT, that the DoC was finding itself in. The Medium Term Strategy comprised of eight Strategic Goals, supported by 17 Strategic Objectives. These Strategic Goals and Objectives had to be realized through the achievement of numerous three year targets which in turn contributed towards the twelve Government Outcomes. The three-year targets were allocated across the six Programmes of the DoC and in certain instances the achievement of these targets required close collaboration with the department’s entities, partners in the private sector and civil society organizations.

The Department’s 2011-2014 Strategic Plan was in line with the Medium Term Strategic Framework (MTSF) of Government that was informed by the electoral mandate period (2009-2014). It supported the following Government Outcomes stemming from the MTSF, and was confident that it could contribute towards them. These outcomes were: Improved quality basic education, long and healthy life for all South Africans, safe, decent employment through inclusive economic growth, a skilled and capable workforce to support an inclusive growth path, an efficient, competitive and responsive economic infrastructure network, vibrant, equitable, sustainable rural communities contributing towards food security for all, responsive, accountable, effective and efficient Local Government system, environmental assets and natural resources that were well protected and continuously enhanced, to create a better South Africa, a better Africa and a better world as well as an efficient, effective and development oriented public service and an empowered fair and inclusive citizenship.

In Developing and deciding upon its six Flagship Programmes, the DoC had to align itself with the twelve desired outcomes of the MTSF, the Millenium Development Goals, the World Summit on the Information Society and the New Growth Path.

In addition, it had to take into account and align to the President’s 11 November G20 statement, Estimates on National Expenditure (ENE) for 2011, the January 2011 Lekgotla, the State of the Nation Address (SONA) of February 2011 as well as the Minister’s priorities. The DoC had to do all this while coping with resource constraints and organizational challenges. All these factors influenced the eight cross cutting goals and 16 objectives. Underlying all these competing factors was the urgent priority of job creation, which had to happen regardless.

According to the Bluepeter study of 2004, the following technologies would be crucial to the ICT sector in South Africa towards 2015: Mobile technologies and devices, wireless network technologies, human language technologies, open source software, telemedicine, geomatics, manufacturing technologies (robotics and artificial intelligence), Grid computing, and Radio Frequency identification. The truth was that those technologies were already in common use in 2011 in South Africa. The country had developed beyond what was predicted in 2004. Cloud-computing and social media was in common use in South Africa today. This indicated the speed with which things developed in the ICT sector and this had to indicate the possibilities of what it could be like in 2020. The DoC and its state owned entities (SOEs) had to proactively respond to the ICT challenges of 2020.

The following have been identified as Ministerial Flagship Programmes:
1.   Job Creation - to establish an ICT Industry Wide Working Group on job creation whose purpose would be to facilitate the identification of priority areas for job creation.
2.   E-Skills - through the e-Skills Institute, massify the e-skilling of our nation for a rightful place in the Information Society and Knowledge-based Economy, ensuring (i) that citizens improve their quality of life through the use of ICTs, and (ii) that employment ready students were “delivered”.
3.   Broadband - plan to improve broadband penetration to match those of our comparative countries such as India, Brazil and Chile. Develop an Integrated Broadband Plan that would facilitate capital investment, innovation and rural access. Plans for connecting schools, health and government centres would not only improve service delivery, but also improve uptake and usage of broadband by government and individuals.
4.   Digital Terrestrial Television (DTT) - South Africa had formally adopted DVB-T2 as the preferred standard for the migration of analogue to digital broadcasting. In implementing the Digital Migration Policy in South Africa, the programme would focus on finalising the set-top box manufacturing strategy, scheme of ownership support for poor households, and the local and digital content development strategy.
5.   Postbank – The Postbank Act was signed late last year. Work would begin to fast-track the roll-out of the Post Bank centres or outlets throughout the country.
6.   Rural Connectivity - ICT Rural Development Strategy which would be implemented through various key programmes during the financial year 2011/12.

Broadband was a key area on which the development of the ICT sector depended. It was defined as telecommunication in which high-speed internet connection was available enabling data transmission with a wide band of frequencies and capable of achieving data transfer rates of at least 256 Kbps. Its penetration had to be increased. A Broadband Strategy and Implementation Plan had to be developed. Broadband legislation had to be included in the Electronic Communications Act Amendment Bill and introduced in Parliament. Broadband guidelines for Provinces and Municipalities had to be finalized.

With the increase in Broadband penetration, the capacities of network providers, content providers and service providers would increase, with a resulting increase of service delivery capacity for government, the health, education, business and entertainment sectors.

- The DoC had to develop borrowing, investment and lending policies for the Postbank.
- For Digital Terrestrial Television (DTT), the DoC had to accelerate the implementation of the Broadcasting Digital Migration Policy in totality. It had to ensure the availability of affordable set-top boxes (STB) and the roll-out of the scheme for ownership support for the STBs. It had to educate the consumers and generally oversee the process, aiming to cover 80% of the population.
- Regarding e-Skills, there would be aggressive e-Skills training programmes, public awareness campaigns and the ICT career expo would be expanded. Four more tertiary institutions would be built, which would provide ICT training. There were international e-Skills programmes that South Africa would participate in. Programmes targeting 1100 youth and unemployed graduates would be initiated. E-Skilling did not mean mere IT teaching. IT teaching concerned only the device and the technology. E-Skilling meant focusing on technology, business and people collectively.
- Concerning rural connectivity, the DoC had to adopt and implement the ICT Rural Development strategy, operationalise the SMME e-commerce portal, establish 400 Digital Hubs in rural areas, and facilitate the rollout of low power transmitters to cover 5 million inhabitants.
- The DoC aimed to create 151 050 jobs in the areas of broadband infrastructure and services, DDT infrastructure, the creative industries like animation, SMME and capacity building, the manufacturing of electronics, the regulatory environment and the postal sector.

There was a slide to show a breakdown of the areas in which the 151 050 jobs would be created over a planned three years. Some of these job creation programmes had been budgeted for at this stage and others not.

Other strategic priorities for the DoC
▪ Policy and Regulatory Reform included developing an integrated ICT Policy Framework, implementing the provisions of the South African Post Office Bill, amending the Electronic Communications Act, amending the Independent Communications Authority of South Africa Act (ICASA) and implementing the ICASA Performance Management System.
▪ Spectrum management was the second other strategic priority. The National Radio Frequency Spectrum Plan had to be validated from 20GHz to 100GHz.The DoC also had to facilitate the efficient utilization of the Radio Frequency spectrum.
▪ The Cyber Security Policy had to be finalized and implemented.
▪ The SOEs had to be stabilized and aligned with Government priorities.
▪ The DoC had to align its ICT strategy with internationally accepted green standards and principles.
▪ The DoC had the task of reducing the cost and improving the quality, availability and usage of ICTs.
▪ Health centers and schools had to be digitally connected to the world.
▪ The ICT sector was an area in which many SMMEs could develop and this would be stimulated by means of government supported and steered programmes.
▪ ICT played a major role in international relations and trade. South Africa could contribute towards ICT infrastructure development in Africa. There was the possibility of partnering with other countries in the execution of some of these programmes. The DoC would work towards increasing bilateral agreements with countries in the North and other countries in the South.

Dr Wesso said that the change in the nature of communication and business due to the evolution of ICTs presented an opportunity that the country could use to create jobs, and it had to make use of the opportunity.

The DoC had developed an instrument to measure its own performance and progress. It was called the E-Barometer and Dr Wesso handed over to Mr Phiri to present on it.

The e-Barometer Index – Mr Themba Phiri, PNC on ISAD
The e-Barometer was informed by measurements for indicators for the Millenium Development Goals, as well as the World Summit on Information Society Action line. This index consisted of 35 indexes, which together formed the barometer index. The main focus was on six sectors; the ICT sector, government, education, individuals, households and community. The DoC had to understand how ICT penetration was shaping in society. This was important in terms of the vision for 2020 referred to earlier. The output had to be a measure called the compound annual growth rate. That rate would indicate how many households had access to internet, radio or mobile services. According to slide 39, the compound annual growth rate had been increasing, but not always at the same tempo. The growth between 2000 and 2006 had been 3.01% and had slowed down between 2006 and 2009 to 1.29%. The presence of tele-centres would be important, because it would give the population access to digital services. The growth rate of 1.29% was weak, compared to emerging economies like India and Brazil. To inform 2020, one had to understand what had been the key drivers and meeting people’s needs. This would then be the areas to focus on, on the road towards 2020.

Financials 
Mr Sam Vilakazi, Acting DG: Finance and ICT Enterprise Development said the Medium Term Expenditure Framework (MTEF) baseline allocation was R1,889,112 billion for 2011/12, from which R440 000 was deducted for once-off items (Sentech: Dual Illumination, USAASA/USAF: STB Subsidy and Broadband ICT-Universal Access), leaving R1,449,112 billion to be spent on programmes. This was an 11.6% decrease in terms of the allocation for the previous financial year (FY) when the allocation was R2.1 billion

The baseline allocation was R1,721,705 billion for 2012/13, from which R380 000 was deducted for once-off items, leaving R1,341,705 billion to be spent on programmes. This was an 8.9% decrease in terms of the allocation for the previous FY.

The baseline allocation was R1,851,681 billion for 2013/14, from which R440 000 was deducted for once-off items, leaving R1,411,681 billion to be spent on programmes. This was a 7.5% increase in terms of the allocation for the previous FY.

There was a table and a pie chart to explain the breakdown of how this money would be allocated to the different programs. The bulk would go to the SOEs in the form of transfers. The next biggest expense was infrastructure development operations. Administration was the third biggest expense, followed by ICT Policy Development operations, followed by ICT International Affairs and Trade and the Presidential National Commission.

Of the SOEs, ICASA was allocated, on average, the largest amount, followed by the Universal Service and Access Fund, followed by Sentech. The South African Post Office subsidy stood at R180 442 for 2011/12, R51 964 for 2012/13 for and R 54 822 for 2013/14. The reason for the drop was that this subsidy would be phased out in the near future.

Dr Wesso concluded by saying that the DoC believed that it had a strategy that was implementable, focused and aligned to key government programmes and policy and strategy positions. The Department was ready to tackle the new financial year with energy to ensure that it delivered on the strategy presented here.

Discussion
The Chairperson said that he had a challenge to see the connection between the presentation just delivered and the Strategic Plan publication that the DoC had submitted to Parliament beforehand.

Dr Wesso replied that he thought that the Minister would contribute to the response, although he could not instruct the Minister. The idea was to not present the Strategic Plan item by item, but only highlight the focus areas. The whole presentation was based on the Strategic Plan; nothing new had been added.

Ms T Ndabeni (ANC) welcomed the presentation from the DoC, but said that she shared the concern of the Chairperson. She was confused about the presentation. It did not correspond with the Strategic Plan submitted. She did not get the analysis of the industry as it was currently and the challenges it faced. What did the Department have to do in order to address those? Was there a need for a policy review or the introduction of new policies? If there was, it had to be captured in this document.

Dr Wesso said that all items presented were in the Strategic Plan. The presentation just grouped the elements. In the presentation from page 25 onwards, was a summary of what was in the strategic documents in terms of government outcomes, strategic objectives and targets. What was presented was in the original document.

Mr N vd Berg (DA) said that it was very clear what was said. The DoC had set many goals and it had mechanisms to measure its progress as it embarked on these developmental processes. He had heard in Parliament that the DoC under-spent a lot of its budget over the past year. It only spent 40%. That was very low. When one thought of the very important developmental stage that the country was in and role that the DoC had to play, it did not make sense.

Mr Vilakazi replied that it was not correct to say that the DoC only spent 40% of its budget. Actually it was 78%. The Departmental Bid Adjudication Committee had in the current quarter processed a number of requests from units. Most of the remaining requests would be processed within the following two weeks before the end of the financial year.

Ms N Magazi (ANC) wanted to caution the DoC officials in terms of what was said. The Department spent 40% according to statements from Treasury. Mr Vilakazi said it was 78%. Why were these programs not funded earlier in the financial year? Why did they wait until the end of the financial year? The Committee went according to written statements that it received from Treasury, not verbal statements by officials.

The Chairperson told the DoC officials that Members had access to the financial records submitted to Treasury so the officials had to link the submission to Treasury and the current situation on spending and not just deny the figure that was submitted to Treasury.

Mr Vilakazi explained that he got the 78% from the DoC books as it was the on the day before the meeting. There would always be a gap between what was reported to Treasury and the reality at any point after that. Treasury received reports on a monthly basis and after that the spending continued with the result that the information submitted to Treasury was actually outdated.

Dr Wesso reiterated that the 40% was not an incorrect figure, it was true for that particular time, but the expenditure had changed since then and 78% was the new figure, as Mr Vilakazi had said.

Ms Magazi said that the presentation was good, but it fell short in explaining enough about the implementation of the strategy? In some areas it did, in others it did not. She could point out the areas.

Ms A Ndlazi (ANC) asked on e-Skills, whether the approach was still positive, and whether civil society organizations would receive funding when spreading the BEE owned consumer and education awareness campaign strategy.

Ms W Newhoudt-Druchen (ANC) expressed her appreciation for the presentation. On slide 25 she could not see where schools gave computer skills to Grade R learners. What did the DoC do to make sure that children were taught ICT skills, even in poor schools?

Dr Wesso replied that indeed it was very important to teach ICT skills at school level. The DoC had discussions with the Departments of Basic Education and Higher Education and Training. One of the problems that education experienced in the country was the articulation between different levels of education. This was being addressed. The DoC was working towards a situation where children would start at the pre-primary level with ICT education.

Ms Ndlazi’s question was rephrased: Was Civil Society Organizations part of the Strategic Plan of the DoC?
Dr Wesso replied that the skilling of the people had to be massified. The DoC had a collaborative model using schools, universities and NGOs to achieve this, as was the case in India. The modules had to be developed by the institutions themselves and they had to do the quality control for it. So, yes, NGOs would be included.

Ms Newhoudt-Druchen said that on slide 27 it said: Establish 400 digital hubs. Had these been established already or was it still in planning phase? Was this in addition to the Thusong Hubs?

Mr Phiri replied, regarding future projections for the ICT field, that statistics predicted that the potential growth of the telecoms market was R251 billion by 2015. Currently it was standing at R131 billion. The DoC understood that the key driver for this market currently was mobile ICT services and the future would be broadband. The internet service provider market would be key to the expansion of ICT services into the future. It was important to provide access to digital services at a low cost. Infrastructure had to be rolled out to rural areas to make sure that people were connected to the network. This was a way of shaping people’s participation in the ICT industry. When talking about universal service and access, one was referring to a people-centred process, or how people interacted with the market. The growth of the market would not automatically achieve those key policy outlines. People had to be consciously included in the process.

Ms Magazi said regarding Tele-centres that by now the DoC should have reported how many Tele-centres they had. She knew that the Tele-centres were being implemented jointly with the Thusong Centres.

Dr Wesso replied that the DoC had information available on the rollout of Tele-centres thus far. It made mistakes and learnt not only from its own mistakes, but also from international experiences in this field. In rolling out the new centres, those learners who were still without access would be accommodated.

Ms Newhoudt-Druchen said that on slide 30 it said a total of 151 050 jobs would be created. Were they already created or were they going to be created? Would people with disabilities be eligible for these jobs?

Ms Newhoudt-Druchen said that for the 2011/12 FY, there were six items without budget. Why?

Mr Phiri replied regarding the 151 050 jobs, that those were Job Projections. Regarding the 400 Digital Hubs, he wanted to add to what he said previously about the measurement of growth. What the DoC heard in the past three to four years was there was a slow construction process of Tele-centres, multipurpose centres and cyber labs. These centres gave people access to several digital services. Some centres had been launched in Inanda, KZN. These were projected for the medium to long-term.

Mr Phiri replied regarding job creation, that the DoC was dealing with the conundrum regarding financing. The President had just introduced job creation as a priority in the SONA, but the Departmental budget had been determined before that. In areas where the report indicated that it did not have a budget, it would approach the Jobs Fund. The report mentioned those areas as being known to be critical to job creation and where there were budgets available, these had been allocated.

Ms Newhoudt-Druchen referred to slide 32, and asked how far had the Cyber Security Policy been developed? Would it be completed soon? When would it be implemented?

Ms Sekese replied that the aim was to have improved cyber security in 2011/12. Cyber security did not only involve the DoC but also the Police, Department of Justice and the National Intelligence Agency. There were a number of departments contributing. The DoC was responsible for policy and certain elements of implementation.

Ms Ndabeni referred to page nine of the Strategic Plan. She wanted clarity on the organizational structure, the staffing situation and the organogram.

The Chairperson asked what the current HR situation was like in the DoC. Normally HR was the key to the strategic plan implementation, because the bulk of the budget went into HR. The Committee would approve the budget in terms of the HR plan. It would be difficult to approve a budget without a clear picture of the HR needs and the plans to fill posts.

Dr Wesso replied on the inclusion of the HR plan in the Strategic Plan, that the DoC was still finalising its new institutional arrangements. It would be finalised over the next few days.

Mr van den Berg asked about the flagship programmes that were driving the developmental process on the way to 2020, where the country was at the moment and what it had to do to get there. This was more a political question for the Minister, but Dr Wesso could also explain.

The Chairperson said that ordinary South Africans had to be able to understand the Strategic Plan. There was a challenge in that the document did not clearly spell out where the industry was currently, where exactly it wanted to be in 2020 and the detail of the plan to get there. He asked whether the DoC had a clearly developed detailed vision for 2020, or whether it was still in the developmental phase.

Dr Wesso replied on the 2020 vision and the flagship programmes, saying the research had been done for the e-Barometer. This would give the DoC a foundation and an understanding of where it was currently, and where it had to increase its input. The DoC knew where it was, was measuring its progress itself, and knew where it was moving to. Up to this point it was dependent on international studies and rankings, but it was able to do that for itself now.

Mr Munzhelele said that the DoC had a clear understanding of how the sector had performed over the last 15 to 16 years. Mobile penetration was more than 100%. At this stage it was about consolidation in that field. The question became: How would the DoC construct the policy environment in order to respond to that consolidation in the future? It was a known fact that more than 90% of South Africans had access to TV and more than 80% to radio. How were those gaps to be filled? There was competition in the market for that. There were 3000 post offices in the RSA. The target was one post office for every 10 000 people, as agreed within the Universal Postal Union. Currently the ratio was one post office for every 18 000 people. The aim was to have a post office within 5km of the home of every South African. Internet and broadband penetration was 2%. For a country like South Africa with ambitions as set out in the New Growth Path for job creation and building the Knowledge Economy, 2% was not enough. The Broadband Policy would explain what needed to be done in that field.

Mr Munzhelele said that there was a challenge in South Africa around ICT statistics. There was no authoritative voice on ICT statistics, like the DTI was the authoritative voice on trade statistics. Currently, the statistics that one would get depended on to whom you talked. The DoC had to position and capacitate itself in order to become the authoritative voice on ICT statistics.

From a policy point of view, having looked at the quantitative statistics, there were challenges pertaining to convergence. There was the Electronic Communications Act (ECA) which would have to make sure that there was a policy framework to shape its future. There was the ECT Act which pointed at the e-component which was a critical component for integration between broadcasting and telecoms. Secondly, there was no coherent ICT policy in South Africa. There were bits and pieces which posed a challenge. Provinces and municipalities initiated ICT projects, but there was no coherent strategy or coordination amongst projects. Other government departments and levels of government initiated projects, without the DoC being involved. Hence, there was a need for the coherent vision that the Minister spoke about. Thirdly, the postal sector was in the process of being modernized. It was moving away from the bricks and mortar situation to the increasing use of electronics to provide services. This had to be factored in as and when South Africa was redesigning and modernizing its postal service and enlarging its footprint.

Mr Munzhelele said that DDT posed a major challenge to the broadcasting sector in the sense that it opened up the frequency spectrum, which then allowed many more players to play in the space, which in turn generated a need for new content and applications. The regulation of content would also have to be re-invented. The policy environment needed to respond to these challenges.

It was a challenge to increasing investment in infrastructure such as broadband infrastructure as well as social infrastructure. Government had to realize that ICT infrastructure was as crucial and basic as roads and water infrastructure and there was the need to roll it out alongside infrastructure like roads and water. The DoC saw the 2020 vision as the vehicle that would begin to make it possible for the country to approach ICT infrastructure development like the basic development that it had become.

The Chairperson said that Mr Munzhelele did not help in explaining the 2020 vision. When one talked about 2015 MDGs, he understood to what the country had committed itself. He asked what the broadband penetration would be in 2020 and he demanded an answer. He demanded clear measurable predictions in order to know what to measure the achievements of the department against in order to hold it accountable. It would not help the future Committee if there was not a clear measurable vision for 2020.

The Chairperson said that when talking about investment and innovation in the ICT sector, the DoC had to know from where the investment would come. Would it come from government, or the private sector? If from one, or the other, or both, how much would it receive from government and how much from the private sector? The Committee assumed that the DoC had entered into broad consultation with the industry in order to know how much investment to expect. He understood that it was a work in progress and that the details had to be filled in. He emphasised measurability, because when the Committee was being briefed about its role, it was told that everything that it did, had to be measurable.

Dr Wesso said that the 2020 vision was a work in progress. The DoC was starting to deal with the matter. It would do baseline studies to determine the current situation and quantify it. E-Barometer was being designed to do that. It was a work in progress as the Minister indicated in his input.

Ms Ndabeni asked what the nature of the relationship was between Broadband Infraco, the Department of Public Enterprises and the DoC. How would it assist the country in achieving its ICT development goals?

Ms Sekese replied that Infraco had an ECMS license which meant that it could only provide wholesale broadband. The relationship that the DoC had with Infraco was via DPE, and emanated from the infrastructure cluster’s work. Infraco’s target was increasing the points of presence or the wholesale coverage, so that whoever wanted to subscribe in terms of wholesale broadband, would be able to access it. She was unable to provide numbers for that target. There was an ICT work team that the DoC chaired where DPE and National Treasury participated. The DoC was feeding into the workstream, the target that Infraco was committed to, regarding the coverage of wholesale broadband.

Mr van den Berg asked for insight into the situation that occurred in 2010 when the SABC had to be bailed out from going insolvent to the tune of R1 billion.

Mr Vilakazi replied about the transfers to the SABC, saying that these were for specific service delivery projects and that they were ring-fenced. The budget the SABC required was substantial compared to what the department gave. For the SABC to be sustainable it had to generate its own revenue.

Ms Magazi also noted that there was no signature on the Strategic Plan, not by the Minister, Deputy Minister or Acting Director General. She wanted to know whether this was normal procedure.

Mr Osman replied that sending electronic signatures to external printers was a security risk the Department did not want to take, so there were no signatures. This did not imply that they did not approve of the contents of the documents. Other departments were following a similar approach.

Ms Ndabeni asked why official documents submitted to Parliament had not been signed by the leadership of the department and the Minister.

Mr Osman said that the documents were tabled in Parliament through a letter by the Minister to the Speaker of Parliament. The tabled letter was signed by Minister. In the Regulations for the contents of the Strategic Plan, it was not indicated anywhere that the plan had to be signed by the Minister in order to be valid.

The Chairperson said that the Committee needed a signed statement. The reasons advanced in the meeting for the Strategic Plan to be unsigned, was not acceptable. The covering letter had to be signed. It had to be signed until Parliament indicated otherwise.

Mr Osman said that there were various schools of thought when it came to performance measures and indicators. When it came to the alignment of plans, how would you measure progress made in terms of the target. One would look at the degree of alignment.

Dr Wesso said that there were 12 desired government outcomes. The DoC was contributing towards five of them. The degree of success it had in achieving the outcome could be used as a performance measure.

Ms Ndabeni referred to p25 of the Strategic Plan. Column 3 from the left was the performance measure and stated the level of alignment and implementation of the plans. She felt that it was not specific enough to be useful in terms of oversight. She could not use it to determine to what extent the target had been achieved.

Ms Magazi referred to p21 of the Strategic Plan and looked at the headings: ‘Strategic Goal’, ‘Key Outcomes’ and ‘Key Outputs’. She needed clarity and more understanding. The ‘Key Outcome’ was to increase broadband penetration, accessibility and affordability. The Key Output was 10% broadband household penetration. Underneath it said ‘Broadband Legislation’. She asked whether ‘Broadband Legislation’ would not be better situated on top.

Mr Osman said that he was not sure, but the first column was the long-term outcomes, which were increased broad band penetration, accessibility and affordability. The first target was broadband penetration itself; the second output would be the finalized broadband legislation and a third output would be provincial and municipal broadband guidelines. The outcome was the long-term goal stemming from all these interventions. He said that not much had to be read in the order in which the information was presented, because the processes ran concurrently.

Ms Magazi asked whether the Department had any plan about small SMEs programmes for broadband rollout. If there was a plan, what was it?

Ms Magazi asked (still referring to p21) what baseline was used to determine the broadband penetration. It said 4% for 2011/12, 7% for 2012/13 and 10% for 2013/14.

The Chairperson asked, when the DoC referred to broadband penetration, did it refer to broadband penetration in general? It could become a problem if it was too general. There might come a time when a breakdown would be necessary. Did it refer to mobile or fixed line, or a combination of the two?

Ms Sekese replied that the baseline the DoC used at the time when finalizing the policy was 2%. It only included fixed line, ADSL and 3G. It did not count mobile devices. The DoC undertook a study and would appoint a service provider who would assist the DoC in coming up with a more quantifiable baseline. It was in the final stages of appointing the service provider. This survey would give the broad picture of access to broadband including mobile devices. Tele-centres were another avenue through which to access broadband. A method would have to be developed to compile statistics for these centres so that the number of people accessing broadband could be counted more accurately. When Mr Phiri was talking about the e-Barometer, he talked about Tele-centres. The statistics for access to broadband should not be limited to people who access it through a PC in a home. People accessing broad band through using Tele-centres and internet cafes also had to be counted. Once the study was concluded and the true state of affairs was known about broadband penetration, it would be possible to set realistic targets. ICT in education was a critical element to grow broadband penetration. As explained, there were processes underway to determine the actual baseline situation, so that the DoC could then move from there to set realistic targets, to grow broadband penetration in South Africa.

The Chairperson said he agreed with the DoC when it said that these processes could run concurrently. Broadband penetration had been happening anyway without policy decisions. He understood the difficulties that the DoC experienced in getting detailed information on broadband penetration, but he insisted that it was crucial for them to get detailed information that contained a breakdown of the different modes through which people accessed broadband. Once it could be more defined, then if there were problems with any particular mode, it could be identified and rectified. However, if broadband statistics were lumped together, it would be impossible to identify problem areas. It would also be impossible to measure progress accurately. The Director General needed to look into and focus on this aspect.

Dr Wesso replied that broadband penetration was a difficult issue. The DoC was using methodologies of developed countries in terms of access to ADSL, but South Africa was a developing country where the patterns and methods through which people accessed broadband was different. There were Thusong Centres, Tele-centres and internet cafes. Families pooled together to buy a computer. Up till now the DoC used the easy way to measure penetration, but it clearly needed to develop a customized model to measure in this environment.

Ms Magazi asked about the broad band policy that was published in 2009. She did not know how far the Department was with it.

Ms Sekese said that the policy was approved by Cabinet in March 2010. One of the key issues regarding implementation was the establishment of the Broadband Inter-Governmental Committee, because one of the weaknesses South Africa had as a country, was uncoordinated approaches. The function of this committee would be to coordinate the rollout of broadband across the three spheres of government in order to make optimal use of its resources.

Ms Ndabeni referred to p48 in the Strategic Plan. She asked why a shredder would cost R6 000 in one case and R17 000 in another. She asked why two fax machines were costed at R14 400, while it would cost roughly R5 500 a piece currently. She asked from where the 70% increase for fax machines came.

Dr Wesso replied that these figures were estimates to make sure that the DoC could afford the equipment it needed. The price could depend on the quality and the volume of the shredder. In one case a small shredder could be needed because it dealt with less paper and in another case a bigger one could be needed.

Mr Vilakazi replied that government departments were obliged to procure these items through SEDA clients through transversal contracts, even though it could pay a lot less at a normal commercial outlet for the item.

Ms Magazi asked whether it was standard practice to put details of the items needed such as bar fridges and printers in the Strategic Plan document. The Strategic Plan document was a high level document where the content of plans for the Departments was captured. The details could be put into an annexure.

Dr Wesso replied that it was a matter of interpretation. The regulation stated one had to include details of proposed acquisition of movable assets and financial assets and transfers. It was done as it was done in the past. The degree of detail was a question of interpretation.

The Chairperson said that the DoC had to continue providing this information, although perhaps in an annexure, because the Members would demand it, if it was not available.

Mr van den Berg said regarding the task of oversight, that sometimes the Committee read about events happening in the DoC, in the newspapers, without having been notified beforehand. He asked that the Committee be put on the Department mailing lists, so that it could be kept abreast of all developments within the Department on a daily basis. Then he could read it first hand, and not an interpretation.

Ms Ndabeni referred to p48-50 of the Strategic Plan. She noted that four notebooks for the Office of the Deputy Minister cost R102 000, thus roughly more than R25 000 apiece, while a notebook and printer for Executive support were priced at R22 000. There were other references to notebooks all costed differently. Why?

Mr Vilakazi replied that the machines were different, that was why they were priced differently.

Ms Ndabeni wanted to know why the make and specifications of computers were not standardized.

Dr Wesso replied that the DoC would consider these factors when buying the computers. Currently his office had decided to standardize on Dell. An official would have to motivate if he/she wanted another brand, but it still had to go through SEDA. The amounts were estimates, not money spent, and decisions still had to be made about procuring these items.

Ms Magazi remarked that she did not want to see sensitive documents end up on Wikileaks.

Ms Ndabeni said that the computers had to be checked out by the Security Branch to make sure that they were not security risks.

The Chairperson agreed that that was the intelligence part of her work.

Conclusion
The Chairperson said that the HR strategy and its implementation were very important. The Committee had to know who was going to implement the strategy.

The Chairperson said that the industry was fluid. What special initiatives did the DoC have to attract, recruit, develop and retain talent? This would include a succession plan for the DoC. Staff were key to the success of an organization. Many officials in the DoC were in acting capacities and he understood why it had to be the case at some point, but it had to be resolved. To the Director General, he said that he appreciated the fast tracked facts about the analysis of the industry. How was the DoC analyzing the ICT situation and monitoring developments? The DoC was the leading department when it came to ICT and how did it plan to fulfill that role.

The Strategic Plan had to spell out what the contribution of the DoC would be to the GDP when everything that was in the planning stages now, had been put in place. It had to be able to state how it would contribute in terms of job creation, penetration rates, retail processes, investment and innovation. Their strategy had to be seen against the background of the bigger challenges that the country was facing. The Chairperson had the opportunity to read the report of Canada’s Federal Communications Commission. They accepted lots of risk. Risk had not been mentioned in the Strategic Plan. How would one mitigate risk? How would one absorb shocks? This was part of the broader understanding of the market.

He raised the issue of investment. How much from government and how much from the private sector? Was the Department planning smart subsidies? When discussing broadband, he expected the DoC to break it down into the different streams: Broadband fixed line, Broadband wireless, Broadband LTE etc, Broadband 3G. The DoC needed to quantify penetration. The Committee also had to understand it properly. When speaking about progress, it had to speak with authority. Most issues were clear. He could see that there was work being done in the DoC. There were issues in the Strategic Plan that were very important, for example community TV and radio stations that were not mentioned in the presentation. There was a programme moving forward. AR did not reflect exactly what the DoC did, because it used a template from Treasury. The Committee needed to engage the DoC so that the report made sense.

Regarding the issues raised by Ms Ndabeni about procurement through SEDA clients, and whether it was value for money, the Committee and DoC had to engage the Department of Public Service and Administration.

He advised Dr Wesso to put details about the equipment, separate in an annexure and not in the report.
To the Minister, he said that he and the Committee were pleased about the progress and leadership provided to the DoC.

The meeting was adjourned.