By Technology Times Reporters
Lagos. August 12, 2012: Funds in the kitty of Universal Service Provision Fund (USPF) aimed to foster penetration of ICT access and services into underserved areas across Nigeria will be disbursed with principles of equity in mind, Secretary of USPF, Abdullahi Maikano, has assured a stakeholder forum reviewing its impending plans for the next five years.
Maikano assured a stakeholder forum held Thursday in Lagos to review the Universal Service Provision Fund Draft Strategic Management Plan (2013-2017) promising that its activities will follow statutory guidelines and be insulated from political influence.
The forum attracted attendees across the telecoms ecosystem in Nigeria to review industry stakeholders’ responses to the impending five-year plan of USPF.
The current practice of subsidy payment structures of 15%-35%-40%-10% will be maintained under its planned SMP Maikano says noting that the activities of USPF are governed by the Public Procurement Act and other public financial regulations and guidelines that guide its current policy on disbursements of subsidies to beneficiaries adding that, “the current practice is in line with these rules.”
He was reacting to comments received by USPF that the current subsidy payment structures be reviewed to 50%-40%-10% because of high cost of infrastructure rollout by operators.
According to him, the development of the proposed SMP started with an impact assessment of past USPF projects and performance that later formed the basis of the new draft plan.
He also says that the USPF Board notes suggestion that the Fund should consider the nature of operations and ability of project implementers to sustain services delivered with the subsidy funding.
USPF will still intervene to ensure voice coverage to underserved areas due to market inefficiency Maikano says, reacting to comments market forces may not speedily achieve this for unserved areas.
That is based on views that USPF efforts at providing incentives to promote voice coverage these areas will be undermined as it is assumed that operators will further extend coverage for voice service in the next few years as more urban markets get saturated.
Under the plan, the Fund will still continue to focus its efforts on areas that have been ascertained to be within the true access gap following suggestion that it should consider providing funding for ICT infrastructure development in urban and semi-urban areas adjoining or surrounding USPF rural target areas.
According to the USPF Secretary, it will forward comments by stakeholders on issue of multiple taxation to the Nigerian Communications Commission (NCC), the telecoms sector regulator, which he says “is doing a lot in this area” following request for its intervention.
Stakeholders reckon that USPF should, apart from the subsidies granted, explore ways of subsidizing or waiving taxation for projects implemented under the USPF funds because of high costs associated with deployments in rural areas due to insecurity, distance, power supply and multiple taxes imposed by government agencies that undermine roll-out in those areas by operators.
“It is our opinion that although an integrated national fibre optic backbone does not currently exist within the country, there are significant fibre network deployment across the country that can be leveraged on to extend data services to underserved/unserved areas”, according to USPF in reaction to view that the SMP refers to a “National Fibre Optic Backbone” that does not currently exist in Nigeria.
Under the new plan, the draft SMP provides for subsidy clusters to be identified by June 2013 and “subsidies will be determined by competition and will be available at the beginning of the budget year in 2013″, he adds while reacting to the issue of time allotted for quantifying subsidies.
The Fund says it received comments that, “The SMP 2013-2017 provides for completion of the process of quantification of maximum allowable subsidies for identified clusters by the end of 2013.This process seems unduly long and it is recommended that this process be completed by the first quarter of 2013 to ensure subsidies are available by June 2013.”
USPF also says it is running a pilot in a few locations across the country noting that lessons learnt from the trial run will be used to design a sustainable framework for future fibre deployment on a larger scale across Nigeria.
Satekholders had recommended that the Fund should “consider the implementation of a pilot project which provides coordinated broadband backbone, access, and connectivity to select underserved locations, as a trial initiative and to provide a real-world “laboratory” for USPF to test the options and requirements for these types of projects.”
It was also recommended that the Fund should drive more aggressive targets with its Schools Access Project (SAP), for instance, by aiming to equip all schools (both primary and secondary) with ICT tools and connectivity by 2017.
Maikano responds that in the outgoing SMP, “we implemented a total of 766 SAP projects. Thus, aiming to implement in 2,000 schools in the draft SMP represents a 160% increase in the achievements of the last SMP.”
“USP funds are also not unlimited and there are other target areas for the USPF”, Maikano says adding that, “we will continue to guarantee value for money for all USPF projects.”