Johannesburg - The Department of Telecommunications and Postal Services (DTPS) has been dealt another blow following the resignation of its deputy director-general for state-owned enterprises oversight and ICT enterprise development, Sibongile Makopi.
Makopi resigned earlier this month, throwing the department into further crisis as it prepares to roll out broadband and set-top boxes for almost 5 million poor households in the country. His resignation brings to four the number of deputy directors-general who have left the department in the past five months alone.
In August, Minister Siyabonga Cwele put director-general Rosey Sekese on special leave after she failed to provide reasons why she should not be suspended pending an investigation into her running of the department.
The department is headed by the Cwele’s special adviser Joe Mjwara and a single deputy director general.
The paralysis in the department has raised concerns on its ability to roll out the two key programmes, which are lagging behind global standards.
A senior government official told Business Report that the instability was costing the economy as the rolling out of broadband held back the country’s economic growth prospects and made internet connection in the country expensive.
Instability
“We can’t be expected to compete on the world ICT stage when we have so much instability in such a crucial department,” said the official, who spoke on condition of anonymity. “Unless the department is stabilised there would be ripple effects on other government departments because they are supposed to be on top of the game when it came to internet access.”
Cwele’s spokesman Siya Qoza this week confirmed Makopi’s resignation. Qoza said Cwele was still waiting for the outcome of the Public Service Commission inquiry into Sekese and the general problems facing the department.
“The minister has accepted the resignation of deputy director-general Makopi who will be leaving the department next month,” Qoza said.
“However, the minister has already approved the process to fill the vacancy.”
Last week, Makopi told the standing committee on post and telecoms that the state-owned fibre-optic infrastructure company, Broadband Infraco (BBI), needed a bailout to continue its operations.
Makopi said BBI required an urgent cash injection of R243 million. It also wants a further R932m in funding until 2019. The government holds 74 percent of BBI and has already injected R1.8 billion into the enterprise, which it expects to compete as a commercial entity.
Undercapitalised
But the Treasury claims that BBI only made a profit of R22.56m in its first year of operations, followed by losses.
“We note that BBI has been undercapitalised,” said Sibongile Makopi, who is the department of telecoms’ deputy director-general for state-owned companies oversight.
“We note that BBI has sustained in its history persistent losses and has an obsolete network infrastructure.”
BBI has made submissions to government every year since 2012 in terms of the medium-term expenditure framework for funding of R3.4bn, R2.59bn, R170m and R528m, DTPS documents show. This excludes its current funding request.
Cwele also told the committee that the boards of the SA Post Office and BBI had not been able to sign off on their companies’ audited annual financial statements because in both cases the external auditors had “concerns” about the going concern status of the companies as a result of financial challenges.
A member of the ANC’s national executive committee said the government needed to stabilise the department before it collapsed.
The member said there was unhappiness within the party that the infighting and the exodus of key personnel would affect the poor in particular as the roll-out of set-top boxes was targeted at them.
BUSINESS REPORT