Opposition parties reject establishment of another state-owned company

CAPE TOWN - Opposition parties have rejected the launch of another state-owned company that will consolidate and control all digital assets across the state. 

The Communications and Digital Technologies Committee received a briefing on the consolidation of fibre networks from all State-Owned Enterprises (SOEs) to form the South African State Digital Infrastructure Company. 

But the move has been criticised by some parties who say there’s no need for another state company that will be poorly managed and drain the fiscus. 

The committee heard on Tuesday how the new state-owned entity would be a merger of state telecoms company  Broadband Infraco (BBI)  and government-owned signal distributor Sentech. 

READ: Bill seeking to incorporate all SOEs into 1 holding company open for public participation

The company would have control of all fibre networks and digital infrastructure, including those owned by other SOEs that aren't in the Information and Communication Technology (ICT) sector, like Transnet and Eskom. 

"There is a very clear proposal or recommendation and therefore adopted position of the country, that we should look at streamlining the digital assets of the country in a wholesale provider of broadband connectivity," said committee chairperson, Khusela Diko.

But the official opposition MK Party’s Colleen Makhubele said she doesn’t understand the business case for the new entity. 
  
"Is it just not another financial burden for taxpayers? Why do we keep creating state-owned entities when we fail to manage the current ones?" 
  
BBI CEO, Gift Zowa said there is a need for the state company to go to areas where the major networks refuse to go, such as rural and remote areas, to give the poor greater connectivity.