17 May 2012

Kenya: Telecom Players to Start Paying Development Levy

THE ministry of Information and Communication has said it in the final stage of establishing the Universal Service Fund, the kitty where all players in communication sector will be obligated to contribute part of their revenue. Minister Samuel Poghisio said the fund will be gazetted in two weeks time when all the administrative functions are in place.

All Communication Commission of Kenya licensees- mobile operators,broadcasters, ISPs, postal/courier service providers- will be required to pay 0.5 per cent of their annual turnover to the USF. The money is meant to go towards promoting access to telecommunications services throughout the country especially to neglected and low income areas. "We are at a very advanced stage right now, within the next two weeks its possible that we should have registered or gazzetted the board that will run it," said Poghisio.

The establishment of the USF has been delayed by three years, having been provided for in the The Kenya Communications (Amendment) act of 2009. Among the factors that led to the delays were some opposition from telecom licensees over how much should be levied. Originally it was proposed 1per cent of their revenues which was strongly objected to.

Safaricom will be the biggest contributor to the fund. For instance if the fund was in effect, it would have contributed up to Sh535 million from its Sh107 billion revenue. The company's CEO Bob Collymore welcomed the move saying the levy amount had been done with transparency. The minister however said they are yet to fill three slots in the seven-member board of the Universal Service Advisory Council (USAC), the key decision making body of the Fund. "The board is very crucial, we are waiting to get the right qualifications,we have already appointed 4 , we need three more and we are about to finish soon," Poghisio said yesterday.

On Wednesday,CCK acting director general, Francis Wangusi had revealed that the ministry was facing a shortage of applicants where less that 10 people had applied for the seven positions. He said it was likely to re-advertise. Poghisio was speaking on the sidelines of an event to mark the World Telecommunications and information society day.

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