Communications minister Solly Malatsi.
South Africans from far and wide have engaged with the draft policy direction that seeks to review the role of equity equivalent investment programmes (EEIPs) in the ICT sector, with the official public consultation process garnering more than 19 000 submissions.
This was revealed by the minister on Friday, delivering his department’s budget vote speech in Parliament.
The Department of Communications and Digital Technologies (DCDT) and other state departments have been tabling their budget votesfor the 2025/2026 financial year, detailing departmental performance and spending priorities, among others.
Over the medium-term expenditure framework (MTEF), the DCDT has been allocated a total of R7.8 billion. Of this, R5.4 billion – or 69.1% – is allocated to transfers to entities and project-specific funding.
Providing some insight on efforts to align policy to attract investment, the minister referenced the EEIP policy direction, saying it is to provide clarity and certainty to investors.
“While analysis is ongoing, the initial view shows strong support,” said the minister about the public feedback. “Public participation is essential to our democracy, and the volume of submissions reflects how seriously South Africans engage in policy processes. I thank everyone who contributed, including political parties in this house. All your inputs will inform the final policy direction.”
In May, Malatsi gazetted a draft policy direction on the role of EEIPs in the ICT sector as a mechanism to accelerate broadband access.
South Africa’s current Electronic Communications Act mandates that foreign telecoms companies must allocate 30% local equity to historically disadvantaged individuals to gain a licence.
This has seen companies like Elon Musk’s Starlink failing to obtain an operating licence in the country, as they have not complied with this requirement.
Malatsi’s draft policy direction proposes allowing EEIPs as an alternative – meeting transformation obligations through skills development, SMME support and shared infrastructure investment rather than direct shareholding.
Since its publication, it has been widely debated, drawing criticism and support across the board, including from political parties, ICT pundits, industry bodies and several ministers within the Government of National Unity.
During his speech, the minister highlighted some of the achievements and efforts since taking office at the DCDT and noted that while progress has been made, it is not fast or expansive enough.
As a result, the department has identified priority programmes over the MTEF.
Top of the agenda is a comprehensive review of the legislation governing the ICT sector, said Malatsi, which the Parliamentary Portfolio Committee on Communications and Digital Technologies and various industry members have also called for.
“Thirty years into our democracy, the legislation in our portfolio has not kept up with the evolution of the sector. It is for this reason that I am today announcing a legislative and policy colloquium. This process will bring together all stakeholders – government, business, civil society, academia – to determine the exact steps needed to ensure that our legislation is fit-for-purpose and future-oriented.
“I want to emphasise that this will be an intensive process that will lead to action from the department within months, not years. We will move with speed and urgency and drive this collective agenda for change and progress as a matter of priority.”
“We will also continue to pursue meaningful connectivity – that is, connectivity that is affordable, reliable and fast enough for modern applications. Through the Cost to Communicate Programme of action, ICASA’s [Independent Communications Authority of South Africa’s] updated regulations, improving access to smart devices and further connecting more underserved communities via SA Connect, we are actively expanding Internet access to minimise the digital divide.”
The minister also announced an initiative aimed at expanding access to smart devices.
According to him, the DCDT will facilitate a process between government, original equipment manufacturers (OEMs) and the private sector to provide access to free smart devices to learners, students, and township entrepreneurs.
“We are thus calling on the private sector to pledge funds for this initiative, and on OEMs to make devices available at a discounted price, so that we can reach as many beneficiaries as possible. Through these pledges, the private sector will procure devices directly from manufacturers, which will then be distributed directly to beneficiaries.
“Government will only facilitate this process, rather than being involved with procurement or distribution, so that we can reach our beneficiaries with efficiency and cost-effectiveness.”
Turning to governance and performance of his department and its entities, Malatsi noted it has been a standing area of concern within the portfolio.
Measures to increase accountability in the portfolio, he said, include a monthly governance cycle where entities report directly to him, rather than relying solely on quarterly reports, issuing an instruction to the department to do monthly expenditure reviews to identify areas for cost-savings and to enforce financial discipline, continuing the work on the merger of Sentech and Broadband Infraco for improved expenditure efficiencies, as well as redesigning the State IT Agency’s business model.
“The work ahead demands a new standard and this portfolio must be defined by performance, accountability, and impact, not by excuses or complacency. South Africa has a long way to go for us to achieve our goals of universal connectivity and empowering all our citizens with the skills and resources to use that connectivity productively.
“Making progress will require that we, as a department and entities reporting to the department, approach every day with an unwavering commitment to serving our people. Making progress will require that we work closely with all stakeholders in society to ensure that we grow our sector to the benefit of all South Africans.”
