UTL: Finance Minister, PS Muhakanizi says the new move is to drive internet price cuts in the country
Kampala, Uganda | ISAAC KHISA | Uganda government’s new plan to procure all mobile and fixed telephony communication services as well as internet from Uganda Telecom Limited (UTL) at a lower price is to trigger a price cut of these services, according to the Permanent Secretary in the Ministry of Finance, Planning and Economic Development, Keith Muhakanizi.
Muhakanizi, who is now embroiled in a battle with the Ministry of Information, Communication and Technology and National Guidance over a directive for the government entities to use only UTL services, told The Independent in an interview, that the decision is intended to ensure that the price of telecommunication services especially internet reflects that of its neighbouring countries – Kenya, Tanzania and Rwanda.
“What I am fighting is for the government to buy internet services at a lower price and also ensure that the service providers (in this country) brings down the price of internet,” he said, “I will fight this war and I will win.”
He said internet service providers in Uganda are currently charging clients as high as US$300 per megabit per second per month yet their counterparts in the region are charging below US100 per megabit per second per month.
“I think there’s something wrong (in this country) and that is the war aim fighting,” he added, “If NITA wants us to buy their internet, let them lower their prices and there will be no need for us to go to UTL.”
At the moment, the Ugandan government buys its internet services through the National Information Technology Authority (NITA) at US$190 per megabit per second per month, according to the Authority’s Executive Director, James Saaka.
He, however, said they are ready to hold talks with the finance ministry on how to lower their price of internet and possibly partner with UTL.
Muhakanizi says UTL has agreed to connect all the ministries departments and agencies at US$100 per megabit per second per month.
In a letter dated Sept. 14, Muhakanizi directed all Government Ministries, Departments and Agencies (MDAs) to procure mobile phone services including internet from UTL.
He also instructed all government entities that still owe UTL money to clear the outstanding amounts immediately, failure of which they will not receive funds for the second quarter of FY 2017/18 until the payments are made.
The new move, he says, aims to help revamp the struggling telecom firm but also provide internet service to government and the general public at a lower price. It is also hoped that this will drive a surge in the country’s internet penetration.
Muhakanizi could not state the amount of money that the government spends annually on the telecom services including internet.
But this development has not gone well with Frank Tumwebaze, the minister for ICT and National Guidance.
In a letter dated Sep.19 to Ruhakana Rugunda, the prime minister, Tumwebaze says the new directive does not usurp the mandate of his ministry which is in charge of implementing the broadband strategy among other aspects of ICT development in addition to reversing the cabinet decision made in 2012 recommending the use of the National Backbone Infrastructure (NBI) for all government internet under the management of the NITA-U.