Big funding boost for Icasa as spectrum auction looms

National treasury has allocated R300-million in additional funding to communications regulator Icasa for the 2022/2023 financial year, documents filed with the national budget tabled in parliament on Wednesday show.

The medium-term expenditure estimate for Icasa jumps from an adjusted appropriation in the 2021/2022 financial year of R508.2-million to R769.4-million in the 2022/2023 period. That’s an increase of more than 50% and comes as the regulator prepares to auction spectrum next month.

“Additional funding of R300-million in 2022/2023 is earmarked for strengthening regulatory capacity and licensing spectrum … specifically wireless broadband services,” treasury said.

The expenditure estimate for the following year then falls back, to R473.9-million in 2023/2024 and R495.2-million in 2024/2025 for an average growth rate from 2021/2022 to 2024/2025 of -0.9%.

State-owned broadcasting signal distributor Sentech, meanwhile, will no longer receive any funding from national treasury for the “dual illumination” of both analogue and digital terrestrial television signals, with government promising the migration to digital TV will be concluded this year.

In the 2021/2022 financial year, Sentech was allocated an adjusted R169.7-million for the migration to digital broadcasts and for dual illumination costs.

Additional funding of R300-million in 2022/2023 is earmarked for strengthening regulatory capacity and licensing spectrum

National treasury said the department of communications & digital technologies will focus mainly on implementing digital migration and spectrum licensing in the medium term.

Other areas of focus for the department include the South Africa Connect project to roll out broadband in rural and underserviced parts of the country and implementing the legislative programme to support the long-delayed policy overhaul for the sector following the publication in 2016 of an ICT policy white paper.

The department has a budget of R7.7-billion over the medium term, of which 72.2%, or R5.4-billion is allocated for transfers to entities for their operations, and for project-specific funding.

“Expenditure is expected to decrease at an average annual rate of 13.3%, from R3.9-billion in 2021/2022 to R2.5-billion in 2024/2025 because of a once-off allocation of R1.1-billion in 2021/22 for the broadcasting digital migration project.”

Salary moderation

The department’s second-largest cost driver is salaries, spending on which is projected to increase at an average annual rate of 1%, from R295.8-million in 2021/2022 to R304.4-million in 2024/2025. The number of personnel is expected to decrease from 379 in 2021/2022 to 376 in 2024/2025, in line with a new organisational structure, which is expected to be finalised in the medium term.

“To fast-track the broadcasting digital migration project, the department has revised its delivery model. All analogue transmitters are expected to have been shut down by the end of 2021/2022. The bulk of funding for this project has been transferred to the Universal Service & Access Fund and the Post Office in previous financial years and has been retained by the entities… As a result, spending in the broadcasting digital migration subprogramme in the ICT Infrastructure Development and Support programme is expected to decrease from R1.3-billion in 2021/2022 to R84.1-million in 2024/2025,” national treasury said.  – © 2022 NewsCentral Media

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