• Judgment Reserved on Porn Channels

    The Western Cape High Court has reserved judgment on whether the decision to licence three porn pay channels should be reviewed.

    The Justice Alliance of South Africa (JASA), Cause for Justice, and Doctors for Life argue on why the Independent Communications Authority of South Africa (ICASA) erred in licencing the channels.

    Digital Media (operating as Top TV and later StarSat) was granted three licences in April to broadcast Playboy TV, Desire TV, and Brazzers, subject to conditions.

    To read an article titled, “Judgment reserved on porn channels,” click here.

    IOL News
  • ICASA Reviews Proposed New Call Termination Rates

    The Independent Communications Authority of South Africa (ICASA) says it has started the process of reviewing its proposed new call termination rates.
    ICASA spokesperson, Paseka Malekathe, says in order to do the process in a transparent and fair manner, questionnaires will be sent to every licensee to seek information for the review.
    ICASA, which was given six months by the court to amend its regulations, has given the licensees are required to submit responses to ICASA by 13 June 2014.
    To read the article titled, “ICASA reviews proposed new call termination rates,” click here.

    SABC News
  • USAASA Calls for Cheaper Data Costs

    The Universal Services and Access Agency of South Africa (USAASA) says mobile services are meaningless if they are not affordable.

    USAASA spokesperson, Khulekani Ntshangase, points out that, "To attain the goals of universal access and service to ICT [information and communication technology], the country needs to ensure that prices should be affordable."

    Ntshangase’s comment follows the ruling by the outh Gauteng High Court in Johannesburg that the Independent Communications Authority of South Africa's proposed new call termination rates were invalid and unlawful.

    To read the article titled, “Call for cheaper data costs,” click here.

    Fin 24
  • ICASA’s Possible U-turn on Call Rates

    South Africa's telecoms regulator, the Independent Communications Authority of South Africa (ICASA) says it may reconsider planned cuts for 2015 and 2016 in the amount mobile operators charge each other to use their networks.

    ICASA spokesperson, Paseka Maleka, points out that, "In this case, we may review 2015 and 2016 mainly in trying to avert a very lengthy legal challenge.”

    Maleka’s comments come after mobile operators MTN and Vodacom have asked the South Gauteng High Court to halt plans by ICASA to halve the fees operators charge competitors to carry calls on their networks.

    To read the article titled, “ICASA may make U-turn on call rates,” click here.

    Fin 24
  • Zambian Govt Blamed Over NGO Registration

    The Zambia Council for Social Development (ZSCD) has charged that government is wasting time by once again extending the registration for non-governmental organisations (NGOs) in the country.

    Government has again extended the registration period for NGOs by sixty days effective 4th February to 5 May 2014.

    ZCSD executive secretary, Lewis Mwape, points out that mainstream NGOs in the country will never register under the NGO Act and that government’s extension of the deadline is a sheer waste of time.

    To read the article titled, “Government wasting time extending the registration for NGOs-ZSCD,” click here

    Lusaka Times
  • Zambia Speaks Out on NGO Act

    The Zambian Ministry of Community Development Mother and Child Health says it is still awaiting correspondence from the Ministry of Justice on the implementation of the Non-Governmental Organisation Act of 2009.

    The ministry’s deputy Minister, Jean Kapata, says the response from the Ministry of Justice would determine the fate of all non-governmental organisations (NGOs) that have rejected to register under the Act.

    Kapata says the registration has since closed, adding that the NGOs that are not yet registered will have themselves to blame if deregistered.

    To read the article titled, “Response from Ministry of Justice would determine fate of all NGOs that have refused to register-Kapata,” click here.

    Lusaka Times
  • Ban on NGOs in Zim Lifted

    A ban on aid bodies in Zimbabwe’s Masvingo province has been lifted, and government is appealing to non-governmental organisations (NGOs) to resume operations there.

    Former provincial governor, Titus Maluleke, ordered the discontinuation of 29 NGOs, which provided food to desperate families in Masvingo, accusing them of engaging in political activity.

    However, Minister of Provincial Affairs, Kudakwashe Bhasikiti, has announced the cancellation of the ban, arguing that the government cannot feed all the starving people in the province on its own.

    To read the article titled, “Masvingo welcomes back NGOs,” click here.

    Mail and Guardian
  • ICASA Plans to Cut Call Rates

    The Independent Communications Authority of South Africa (ICASA) proposed a cut of up to 75 percent over the next three years in the fees mobile phone companies can charge competitors to use their network.

    ICASA has released its draft call termination regulations, significantly reducing the cellphone rates of some networks.

    In addition, ICASA introduced an asymmetric rates system for smaller operators with a market share of less than 20 percent, which is aimed at promoting investment, encouraging competition and fostering small, medium and micro enterprises.

    To read the article titled ‘Icasa proposes slashing call rates’, click here.

    Fin 24
  • SA Electricity Industry and the UK, NZ, Chile and Brazil

    The challenge for all electricity sectors is to ensure an adequate supply of electricity at an affordable price. All countries have their own challenges, degrees of private sector involvement and of political intervention, but nowhere in the world is the system as archaic as in South Africa (SA).

    In this country we have Eskom, a government-owned, vertically integrated monopoly still in control of the whole process of producing and distributing electricity, except for the 50 percent or so of distribution carried out by local authorities. We do not know the real price of our electricity because the real price could only become apparent if our electricity were traded, like any other commodity, in a market where prices are determined by supply and demand.

    In the United Kingdom (UK), privatisation of the electricity sector proved hugely profitable for government. Profitable, not only from the sales revenue, higher taxes on industry profits and dividend income but also because the government was relieved of the financial responsibility of trying to prop up a failing electricity sector. Governments elsewhere, and particularly in SA, seem strangely reluctant to exploit such revenue-raising opportunities.

    In a snapshot of the UK electricity sector, the following is evident. While the sector has been completely privatised, it is heavily regulated and subject to political interference, interference from green pressure groups, and the European Union bureaucracy. There are numerous taxes, green levies, renewable energy subsidies, and the bizarre wind farm constraint payments. Wind farms, subsidised to generate electricity, are paid constraint payments, which amounted to £30 million last year, to shut down in stormy weather for fear of destabilising the grid.

    The National Grid desperately needs to upgrade and modernise to allow for the levels of renewable energy committed to by the UK government, but it cannot afford to do so because its profit margins are tightly regulated by the Office of Gas and Electricity Markets (OFGEM).

    Consumer prices in the UK are not transparent. Although there is a bilateral trading market, confidential bilateral contracts remain the dominant market mechanism. Competition in generation and retail has increased substantially, but there is still a large degree of vertical integration with the ‘big six’ energy companies in the UK owning three quarters of generation capacity. Initially, the liberalisation of the energy sector was very successful and there were significant price decreases, but the sector now faces enormous challenges due to political intervention and excessive government control.

    In New Zealand, the electricity sector is not completely privatised but consists of a combination of State and private entities competing with each other. Regulation in the industry is light-handed and flexible. There are minimal barriers to entry for small businesses, and market participants and all consumers have a large degree of choice. There is free trade in electricity and participants can choose to either purchase on the spot market, or use bilateral contracts and all prices, contracts and investment costs are transparent. Companies are carrying the cost of upgrading. The cost of modernising, as can be seen in the rollout of smart meters, is being absorbed by the distribution companies. Effective retail competition exists with up to nine suppliers to choose from in some areas, and the switching process takes a mere 24 hours. Other incentives are also offered to consumers who use electricity efficiently.

    To effectively coordinate outages in transmission and generation, the government uses sophisticated methods such as procuring ancillary services through contracts with electricity generators, retailers and distributors. Government participation and facilitation, rather than intervention and regulation is evident.

    In Chile, despite difficult odds, endeavours to create competition in the electricity sector, particularly in generation, have been largely successful. There is a vast grid relative to a low population density. Chile has very little natural energy resources which makes it heavily reliant on the importation of fossil fuels. Disruptive and damaging earthquakes also pose a problem to the viability of investing in nuclear energy production.

    Although the sector is completely privatised, it is heavily controlled by the government. Two markets exist alongside one another, a free market for large industrial consumers and a regulated market for households and commercial operators. There is no retail market so captive household consumers lack choice and while free customers and distributors may purchase electricity on a spot market, spot prices are capped.

    The Chilean government, however, has been proactive in addressing security of electricity supply. It has identified the need to move away from reliance on hydropower and is exploring new sources of fossil fuels to support thermal electricity production. An important element of the success of the electricity reform has been the institutional bias to protect the property rights of original owners of capital in the electricity sector yet limit their ability to exploit market power by encouraging competition. For most developing countries the opposite bias prevails where the tendencies to renege on regulatory contracts with initial private property holders have led to failed reforms.

    Chile’s neighbour, Brazil, faces somewhat greater challenges due to its institutional design. The sector there faces rapidly growing demand as it is estimated that an additional 3 000 - 5 000MW of generation capacity is needed annually.

    Most of the distribution networks are privatised, but there is no retail competition and distributors compete with each other for concessions. Household consumers have no choice. The sector is heavily regulated and controlled by government.

    In normal rainfall years, hydro, which is government owned, meets 100 percent of demand. Under drought conditions, Brazil faces huge supply issues. There is an institutional preference to dispatch hydro first, and Petrobas, a government controlled entity, regulates the supply and price of gas. This puts thermal production at a disadvantage and makes it uncompetitive to operate at present. Government controls the electricity supply by imposing rationing and rolling blackouts. The tax component of the consumer bill, slightly reduced recently because of upcoming elections, at the start of the year, accounted for 45 percent. Electricity theft through illegal hook-ups is as much as 20 percent in some areas.

    A free market for large industrial consumers exists and there is private participation and competition in new generation capacity. The free market, which accounts for 30 percent of consumption, is growing fast and it is estimated that it will account for 50 percent in the very near future.

    Where electricity sectors have been liberalised and competition introduced, prices have declined significantly. It is only where governments interfere for political reasons, and impose excessive regulation and taxes, that this trend reverses.

    - Lisa Harraway is a researcher with the Free Market Foundation. This article first appeared on the Free Market Foundation website.
    Lisa Harraway
  • Towards a New NPO Act

    The fifth draft of the Draft NPO Policy Framework on the Amendments of the Nonprofit Organisations Act 71 of 1997 was issued to nonprofit organisations (NPOs) ahead of a consultative meeting in Johannesburg at the end of March 2014. The Nonprofit Organisations Directorate has clearly taken pains to address the concerns of civil society with this version of the framework, which recognises the valuable contribution and role of NPOs in building South Africa’s economy.

    The Framework proposes an NPO Directorate as a specialised direct public service that is ‘a focussed and fully ring-fenced entity’ but still reports to the responsible Minister (in this case, the Minister for Social Development). Amendments to the Act will aspire ‘to promote transparency and accountability within the NPO sector without placing onerous requirements on organisations’. The business case for changes to the structure of the Directorate will be developed through a feasibility study, although it is not clear whether the study will be by internal or independent researchers.

    Recognition ValueThis fifth version of the framework is more inclusive than previous versions, recognising the important role of civil society in the development of the country. It explicitly makes the point that NPOs are not only delivering social services but contributing to economic growth and stability. The framework says: “It is not the aim of government to simply write unreasonably stringent measures that will hamper the growth of the NPO sector.”

    One of the striking things about the framework is the acknowledgement of how little is known about the real size, employment conditions, salaries and income levels of the NPO sector in South Africa. While the Directorate is able to cite a growth in registrations of more than 11 percent per annum, it acknowledges that the majority of registered organisations are still non-compliant and that some 80 percent of registered organisations are voluntary associations.

    One of the proposals in the framework is for the Directorate to conduct research on the ‘income levels and contribution to the South African economy’ of NPOs and make this available to the public. This should be welcomed and encouraged – the more we understand about the South African NPO sector, the better we will be able to lobby for, and jointly create, enabling policies and practices.

    Reducing the BurdenA key component of the framework is the recognition of the burden of multiple registrations and compliance mechanisms on NPOs and, particularly, that smaller organisations are often unable to meet the minimum requirements. GreaterGood welcomes the proposal to simplify the registration processes and the assertion that Trusts, Voluntary Associations and Nonprofit Companies should be subjected to the same registration and compliance requirements.

    We also welcome the move towards electronic registration and faster turnaround times, working with a network of partners offering registration services in areas where Internet penetration is not as good. However, we would like to urge the Directorate to investigate the use of cellphone and USSD solutions which have been very successful at connecting isolated communities with services in similar economies like Kenya and Nigeria.

    Size Is Not EverythingAnother proposal to be welcomed is the ‘risk-based approach for monitoring compliance’ and the recognition that, because of the diversity of the sector, the current ‘one size fits all’ approach is not appropriate. However, we would caution against the assumption that the size of an organisation is the key factor in the assessment of risk. According to the framework, “The larger the size and the higher the income levels of the organisation… the more vulnerable and at risk the organisations can be.” Over the last 10 years that GreaterGood and GreaterCapital has assessed organisations and conducted project risk ratings, we have found that size and income levels are not necessarily associated with greater risk. There are many factors at play and a solid, evidence-based risk assessment tool should be developed to address this.

    Self-RegulationThe proposals in this version of the framework cover the concept of self-regulation by the sector in some detail. This is a long way from the first few versions which created anxiety in the sector in terms of enforcement. The fifth version explicitly states: “the intention is not to create a body that will continually interfere in the affairs of organisations.” While we welcome the softer approach, GreaterGood does have concerns about what evidence there is of the efficacy of self-regulation. There are a number of good governance initiatives in existence already and disagreement within the sector about which is the most appropriate. We believe there is a need for an independent, unified compliance framework based on accurate information about size, income and expenditure practices and salary benchmarks in the NPO sector.

    While self-regulation is given recognition in the framework, an NPO Tribunal and appeal mechanism is still proposed to provide a dispute resolution process outside of the costly and time consuming court process. While this could be of great benefit to the sector, our concern is the make-up of the tribunal and the perception of its impartiality. Furthermore, we are not sure that the ‘blacklisting’ of organisations (which is still proposed) is useful. While we of course acknowledge that fraud and mismanagement must be exposed, the potential for hasty, unfair and prejudicial ‘blacklistings’ – outside of a judicial process – means that the process would have to be very carefully detailed and followed.

    GreaterGood and GreaterCapital welcomes the open and consultative nature of the process for developing this framework and believes that, by working collectively, the resultant changes to the NPO Act will be able to meet the needs of our growing and changing sector.

    - Sophie Hobbs is the head of strategic communication at GreaterGood and GreaterCapital. This article first appeared in the Greater Impact, 8 April 2014.  
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