[governance] Pakistan Universal Service Fund in Jeopardy

[Fouad Bajwa]

 A wave of shock and protest has hit the Pakistani ICT and Internet
Communities and Industry as well as all other related sectors over the
federal govt's interest in reallocating the USF for funding programs
other than what the USF was originally created for and has the mandate
to do.

Move to use Rs45 bn of telecom companies for Benazir Income Support
Programme (BISP).
Source: DAILY NEWS PAKISTAN
Abrar Mustafa
Monday, July 25, 2011
http://www.thenews.com.pk/TodaysPrintDetail.aspx?ID=7644&Cat=13&dt=7/25/2011
ISLAMABAD: A wave of apprehensions has taken over the telecom sector
amid reports that Telecom Act 1996 was being amended, raising doubts
that funds of telecom sector organisations will be spent for Benazir
Income Support Programme (BISP).

The Finance Ministry has decided to transfer funds of telecom
companies amounting to over Rs45 billion to the accounts of the
federal government.

Sources disclosed the Finance Ministry has informed the Ministry of
Information Technology and Telecom that it was going to amend Article
33 E(1)(A) of the Telecom (Reorganization) Act 1996, which reads:
“Universal Services Fund and Research and Development Fund accounts
shall be deposited in the Public Accounts of the Federation which will
be operated in accordance with the procedure prescribed for the
federal government”.

The Ministry of Information Technology and Telecom has started
consultations with the relevant quarters for the amendment.

The Universal Services Funds (USF) and Research and Development (R&D)
Fund operate in the shape of two companies under the Ministry of
Information Technology and Telecom. All revenue accrued from mobile
phones and other telecom organizations go to these companies that are
administered jointly by directors of the companies and government
officials.

Any expenditure or investment from funds accumulated in the USF and
R&D Funds is sanctioned by a high-powered three-member committee,
which comprises of federal secretaries of finance and two other
ministries. The funds of USF are used for provision of telephone and
Internet services to the backward and under developed areas of the
country whereas scholarships are being given to more than 10,000
students.

Moreover research is being made in the field of information
technology. Accounts of both the organizations are subject to internal
and external arrangements. Attempts were made to take hold of these
funds when Sardar Latif Khosa was an adviser to the prime minister.
However that could not materialise in the presence of rules and
regulations. After that efforts were made to change the board of
directors and get a CEO of choice appointed. However, the telecom
sector had opposed the move tooth and nail, and the matter was taken
to a court of law. Sardar Latif Khosa had to lose his powers as well
as job.

There are strong reservations about the reported move to amend the
Telecom Act. The move to transfer funds of telecom companies to the
federal government would deprive telecom sector of the funds so vital
for their development and other programmes. It is said that telecom
sector gives billions of rupees to the government in the shape of
taxes and excise duties; therefore, it would be out of question to
give these companies under the control of federal government.

Telecom sector is of the opinion that these funds are generated by
them and are voluntarily given to government. They threatened that if
the proposed amendment is not withdrawn, the move would be strongly
resisted on every front.

Responsible officials of the Ministry of Information Technology and
Telecom confided that discussion is being held with companies and
telecom organizations and a suitable reply to the Ministry of Finance
would be sent after that.


-- 
Regards.
--------------------------
Fouad
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