No to increase in telecoms tariffs

Last week, the nation’s telecommunications providers under the auspices of the Association of Licensed Telecommunication Operators of Nigeria (ALTON) forwarded a letter of notification to the Nigerian Communications Commission (NCC) proposing a 40 per cent hike in call and SMS tariffs. Under their proposal, the tariff for calls will increase from N6.4 to N8.95 per […]

Last week, the nation’s telecommunications providers under the auspices of the Association of Licensed Telecommunication Operators of Nigeria (ALTON) forwarded a letter of notification to the Nigerian Communications Commission (NCC) proposing a 40 per cent hike in call and SMS tariffs.

Under their proposal, the tariff for calls will increase from N6.4 to N8.95 per second (N53.7 per minute) while the price cap for SMS will increase from N4 to N5.61. In addition, one Gigabyte of data will cost between N2,800 and N3,200 as against the current price of between N1500 to  N2000.

The telecommunications operators blamed their insistence on the upward review of tariffs on the rising cost of doing business in Nigeria and the fact that they are still under the strain of the 2020 COVID-19 pandemic and the ongoing Russia-Ukraine war.

This, they noted, has resulted in a 35 per cent increase in their operating expenses, especially the cost of diesel, which sells as high as N700 per litre. They also said the introduction of the five per cent excise duty on recharge cards and vouchers by the Nigeria Customs Service has heightened the burden of multiple taxation and levies on the industry.

The union further pointed to the impact of revenue loss by operators as a result of the 71 million subscribers being banned from making calls due to the non-alignment of their National Identification Number (NIN) with their telephone numbers.

In addition, it said Nigeria has one of the lowest calls and data rates in Africa as one Gigabyte costs an average of $50 (N27, 500) in most African countries whereas it costs between N1,500 and N2,000, depending on the operators and the packages. Malawi, Benin, Chad and Namibia have the most elevated prices for mobile data, positioning among the 10 countries with the highest prices for data globally while Sudan has the lowest in Africa with one Gigabyte at a cost of $0.27.

But the National Association of Telecommunications Subscribers (NATCOMS) rose against the planned tariff hike with its President, Deolu Ogunbanjo, insisting that allowing tariff hike would be pushing Nigerians too far as the economic hardship, including steep inflation rise, has shrunk disposable incomes significantly, making the planned tariff hike ill-timed.

The NCC, on its part, in a statement last Friday, shot down the tariff hike request, stating that with its adherence to international best practices and established procedures in its regulatory activities, approval of such request must be guided by regular cost-based and empirical studies to determine the appropriate cost to be adopted.

NCC Director of Public Affairs, Dr. Ikechukwu Adinde, said in line with international best practices and established regulatory procedures, it cannot approve such tariff hike as part of its mandate under provisions of Sections 4, 90 and 92 of the Nigerian Communications Act (NCA) 2003 “Which entrusts the Commission with the protection and promotion of the interests of subscribers against unfair practices including but not limited to; matters relating to tariffs and charges.”

While we acknowledge the constraints by the service providers in doing business at the point in Nigeria, we must state clearly that all sectors of the economy are facing the same thing and citizens have been bearing the brunt. An additional increment to the pockets of Nigerians at this time will increase the financial burden, which they are already carrying. Therefore, we commend the NCC for its prompt response and for declining the request. This shows that it is positively impacting the lives of Nigerians by not sleeping on its regulatory mandate. Other Ministries, Departments and Agencies (MDAs) should always be responsive to the yearning of Nigerians.

We also commend the National Association of Telecommunications Subscribers (NATCOMS) for rising against the planned tariff hike. Indeed, telecommunication companies in Nigeria have in their many years of operations recorded profits and we believe that the current situation should not push them into an immediate call for an increase in tariffs, let alone a 40 per cent increase.

However, the issues raised by the telecommunications providers about the rising cost of doing business in Nigeria, which caused a 35 per cent increase in their operating expenses should not be swept under the carpet. These companies are running a business and are expected to earn enough to cover their expenses and earn profit. The federal government should work more to provide the necessary infrastructure to enhance the business environment.

In addition, the issue of the over 71 million subscribers barred due to non-alignment of telephone numbers with the National Identification Number (NIN) should be resolved quickly as this has affected the financial status of the telecommunications providers too negatively. The federal government should sit with the service providers to address all the concerns so that this request is not repeated in the nearest future. Nigerians cannot bear additional costs, as the burden on them is already too much, therefore, everything possible must be done to avert it.