Govt to get extra funds for rural phone coverage
Leony Aurora, The Jakarta Post, Jakarta
President Susilo Bambang Yudhoyono has signed a regulation obliging telephone operators to contribute 0.75 percent of annual gross revenues for the state's rural telephone program, as agreed upon by all stakeholders.
The non-tax regulation is expected to raise more than Rp 400 billion (US$41.23 million) this year, a nine-fold increase above the government's annual allocation for the Universal Service Obligation (USO) over the past two years, to make sure that more villagers in remote areas have access to telephones.
Bloomberg news agency reported on Thursday quoting Minister of Communications and Information Sofyan Djalil as saying that the decree had been signed by the President, and his ministry would send invoices to phone companies within weeks.
"The invoices will be for the January-July 2005 period, then we will issue another invoice in September and December," Sofyan said.
The Indonesian Association of Cellular Telephone Operators' (ATSI) secretary general Rudiantara said that the contribution had been agreed upon with the government.
"We will wait for the minister's decree to resolve the technicalities regarding the payment," he told The Jakarta Post.
It was still unclear, for example, if the fee would be calculated based on audited or preliminary figures, he said.
Funds to be gathered by the implementation of the new regulation will be quite significant. ATSI has estimated that combined revenues of cellular operators this year were expected to reach Rp 30 trillion, 25 percent higher than some Rp 24 trillion booked last year.
In 2004, state telephone firm PT Telkom recorded gross sales of Rp 33.95 trillion while the country's second largest telecommunications company PT Indosat booked revenues of Rp 10.55 trillion. Both companies have cellular units in addition to their fixed line and international phone call services.
Indosat's president director Hasnul Suhaimi said that his firm might be interested in partaking in tenders to supply telephone facilities in remote areas.
"We hope to be able to take part in the USO program," said Hasnul, adding that Indosat had not yet considered which technology to use for the program.
As many islands cannot be reached by fixed cables, the USO program uses satellite-based and very small aperture terminal (VSAT) technology. The government provided Rp 45 billion in 2003 to cover more than 3,000 villages, while last year, 2,600 more villages got one telephone each.
The implementation of the program has been widely criticized for its inability to provide supporting services and maintain the installed facilities. Vouchers to buy phone credits and service centers are largely unavailable in the remote areas.
Indonesia has one of the lowest telephone coverage rates in Asia. Last year's figures showed that only about nine million of the country's 238 million people have access to fixed-line phones -- one reason for the booming cellular businesses -- and more than 40,000 villages do not yet benefit from telephone services.