The Universal Service Fund is a pool of money contributed to by all licensed operators – mobile operators, Internet Access Providers, and the fixed line operator – and part of its purpose is to fund the rollout of passive telecoms infrastructure in underserved areas in the country. Operators contribute 2% of their annual gross turnover to the fund. Recent reports suggest that POTRAZ has collected as much as US $41.3 Million USF cash since 2009 when the country dollarized.
According to the report today, of the 11 sites that have been installed, only 2 are currently “on air” while rest are awaiting “completion of microwave transmission installations”.
If you are wondering how on earth the organisation has only managed to install 2 operational base station sites with the fund, you’re not alone. There’s been so much concern about the fund to the extent Econet, the largest telecoms firm in the country and no doubt the largest contributor to the fund, questioned the fund’s relevance, complained that no meaningful development had come from the fund and called for it to be scrapped.
While Econet clearly has a commercial agenda to keep as much of the money they make as they can, POTRAZ really has been slow to implemented the USF fund as it should. Even sadder is POTRAZ proud proclamation that it will take another 2 years just to install 43 sites.
Surprisingly, POTRAZ says the 2 years tortoise pace to install 43 towers is due to them not having enough money for base stations. “Construction of towers at the 43 sites is likely to span over two years since the USF cannot fund all of them in one year, given that the USF is also funding other projects such as the Schools Connectivity project and some deserving postal projects,” POTRAZ Deputy Director General, Alfred Marisa, is quoted in the article.
It would be great if POTRAZ disclosed just how much its Postal licensees contribute to the USF to make this allocation of money to postal projects justifiable. And the Schools Connectivity project, what exactly is this project about? It would also help us understand them better if they explained what happened to the 8 sites they promised they’d complete by end of 2011. Are these part of the 11 we’re talking about now, most of which haven’t completed? If that’s so, what says the 2 year time period promised us now for the 43 sites will be stuck to?
POTRAZ already has a USF projects page on their website, which so far they keep empty. It would help if they posted all such information there as they clearly intended to, so we all know what we’re paying for. Otherwise, yes, just scrap it!
17 comments
Mari yadyiwa
kiki I agree
Complacency! There’s no excuse. I would not be surprised if they diverted the funds to other POTRAZ activities. Put more pressure on them please, Econet.
thanks for the follow up, TechZim
Loving the blogging going on here and the apparent investigative work 🙂
Can you just estimate the cost of one base station so that this charade is obvious. leasing a site (most are in the no man’s land) = $0 annual, the masts = $1000 (http://www.alibaba.com/product-gs/526128208/steel_antenna_towers.html, the microwave repeaters and antennas $1000 (http://shenglu.en.alibaba.com/product/613379908-213300018/14_4_to_15_35_GHz_parabolic_antenna_Microwave_Radio_Relay_Communication.html . 100k should be enough for each base station. kikikiki
could it be that most of the moolah goes to salaries & benefits of execs? >>Mari yausina kushandira inonetsa kushandisa zvinemusoro.
Seriously sub-lease a company like Econet to spend the USF for what it is intended for and charge a management fee, that was the job gets done and POTRAZ still manage to keep the lights on…
But hey what do I know???
Good solution,though i seriously doubt POTRAZ or the other operators would be willing to do that!
I agree to do something efficiently doesn’t seem to be a top priority for most places this side of the world.
Potraz is one of the least transparent state-owned parastatals in Zimbabwe. I have never seen even a single annual report from them published anywhere.
As a state-owned business they must lead by example. They must come out in the open and tell Zimbabweans what they used that money for. They do not operate a mobile network, and yet they have constructed only 11 base stations with 8 times the money Masiyiwa started Econet and almsot twise the amount of money the government of Zimbabwe used to start Netone.
Without transparency it is left to people’s imagination what happened to the money.
Did the Potraz execustives blow the money on the beaches of Cape Town and Durban, entertaining beautiful women, sipping whiskey and puffing Cuban cigars?
Or did they, perhaps, loan sister parastatal Netone some millions?
At what cost were those base stations built?
How much have they spent on the Schools Connectivity programme?
They must come out in the open and as a state-owned company must be at the front when we speak of transparency in the communications industry.
I know everything that Econet does because the publish results and i know what they are doing.
Potraz must be made to account for such dire results and I strongly recommend that the Anti-Corruption Commission swiftly move in.
How do Zimbabweans even know that they are not the ones funding Julius Malema?
I have no kind words for POTRAZ because of gross incompetence. Yes, we
pay for their offices, the furniture, the air conditions, the refreshments,
luxury cars, and yes, the foreign trips, the many seminars, and the lucrative
salaries yet it is difficult to see where they add value but put stumbling
blocks like banning blackberry. When it comes to trivial issues such as
investigating Pastor Makandiwa’s messaging system, ndipo pavanomera manhenga.
You have former PTC people who are used to sloppiness and with no work target and you also have other politically appointed Deputy Directors who are clueless about Telecoms regulations
masquerading as Engineers. I think the organization needs a shakeup from the
top to bottom.
POINTS OF INFORMATION:
1. USF contributions are NOT from licensed operators. USF accummulates a levy on subscribers, collected via the tariff, and due from operators. Initially, operators were allowed use of the funds until end of year but during hyperinflation, this was changed. When you understand whose money it is, then you see more clearly the operators’ role (as collectors) and the POTRAZ role (as Trustees). See the enabling Act.
2. While decision makers responded to hyperinflation, policymakers have NOT responded to myriad of changes in the sector. The enabling Act of 2000 is still as is, with the USF administration and objectives as conceived during the drafting of the Act, say 1999. We are running on thoughts that are 13 years old. If we say the technology year is 6 months (in reality its less) then the technology is 26 years old. What do I mean, universal service in 2012 cannot be the same as it was in 1999,
3. The Minister of Finance has taken over the $40m balance still being referred to as USF. It gone! Money that subscribers put together and entrust to POTRAZ in search of universal access was taken over by Government. Finance say it is under utilised and they are directing it to “national projects”; as if universal access is not a national project, as if money that I as a subscriber have entrusted to a state institution becomes part of the fiscus.
SUGGESTED ALTERNATIVE
Abolish the USF altogether. Subscribers are getting enough of a raw deal without being squeezed of so much money that operators, the regulator and the state then connive to abuse. It is a travesty of justice. If one day subscribers organise themselves, they can pool resources and do a USF of their own. Judging by today’s practices, the subscriber managed USF will inevitably be abused as well. Collecting lots of money and putting it under the care of one body is a recipe for corruption. A 2% reduction in tariffs is welcome.
Potraz must at least tell the nation that fact rather than keep quiet. They must be accountable. Proof that they are the least transparent.
I see someone already implying that the money was perhaps given to Netone…..how pathetic when in fact NeTONE IS IN THE papers talking about lack of funds from the shareholder.If the mpney was misused it was misused only by Potraz.That money should have constructed at least 200 base stations.Netone does not come into the picture at all.It has not had any financial injection except the $45 million loan from Chinese bank only
[…] 2012, Potraz had only managed to install 11 base stations amid reports that the regulator had collected $43 million for the USF since dollarisation in 2009. Back […]
[…] of the projects carried out using the fund in the past have been documented by POTRAZ and by some indications plans are in place to continue with the exercise of the USF […]