Public-Private Partnership Key to Realizing Digital Migration in Uganda

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UBC Managing Director Winston David Agaba. FILE PHOTO

By Our Reporter

The Uganda Broadcasting Corporation (UBC) has dismissed as “false” news reports that the corporation’s finances are being mismanaged.

The Managing Director of UBC Mr Winston David Agaba says that there has been a relentless campaign of distortions and half-truths in the media about the financial status of UBC.

One of the infamous accusations, published in both Sunday Vision of January 1, 2017 and February 26, 2017, is that the management of UBC has sold off its television and radio networks to Chinese company Star Times under Public Private Partnership (PPP).

However, the MD states that the PPP is within the law and UBC is following the modus operandi.

 

Read Mr Agaba’s full statement below:

The Sunday Vision story titled “UBC in Shs68B Deal with Chinese Firm,” published on January 1, 2017 carried distorted facts and it was inaccurate.

The one they published this weekend was even worse.

Both stories do not explain the proposal to concession off the management of the national Digital Terrestrial Television (DTT) and Radio Network distribution rights.

The Government decided on the Public-Private Partnership (PPP) because it could not provide the funding for this project.

The Government is, however, committed to implementing the DTT services to ensure a complete switch from analogue to DTT broadcasting systems.

Through the regulator (Uganda Communications Commission) the government funded the initial digital migration comprising of the Head End, Satellite Signal Distribution for 18 digital transmission sites that had analogue infrastructure. The remaining scope of works itemized below, estimated at $ 23million, was outstanding and the Government advised that a partner be procured to fund and operationalize the network.

Scope of Work

  • Supply and installation of two digital transmitters per site in 10 new sites with the required accessories.
  • Equipping of the 17 sites with one additional transmitter using the installed infrastructure under phase 2.
  • Supply and installation of a new head end at Kololo capable of handling 60-75 additional channels.
  • Supply and installation of 4 transmitters at Kololo.
  • Supply and installation of five radio transmitters and accessories for provision of Radio Services for new sites upcountry.

Uganda Broadcasting Corporation (UBC) – as the National Broadcaster – was tasked to handle this transition. UBC therefore formed a subsidiary Company, SIGNET, in order to separate the operations of the national broadcaster from the digital migration project.

Initially UBC (Signet) had anticipated that Government would fully fund the project but this was not possible due to financial constraints.

The Government directed the Ministry of Finance, Planning and Economic Development (MoFPED) to allow UBC solicit for a partner through a PPP arrangement to operate the existing 18 sites and to install the equipment in the 10 new sites in very remote areas.

MoFPED granted a No Objection to UBC Management for the implementation of the PPP model in the delivery of DTT in a letter dated June 11, 2015, REF: FAD 326/430/01.

Subsequently UBC management proceeded to implement the project as a PPP, as opposed to a Public Procurement Contract as had earlier been envisaged.

In the same letter, UBC was discouraged from negotiating a supplier credit financing under the partnership since the Government was not in position to offer a Sovereign guarantee.

The Notice of Invitation of Expression of Interest (EOI) was approved by the UBC Contracts Committee on June 2, 2015, and advertised on Thursday June 4, 2015 in the Daily Monitor newspaper and on Friday June 5, 2015 in the New Vision newspaper.

All EOI received were evaluated against the criteria stated in the EOI notice and four firms were shortlisted for the next phase which involved the issuance of Request for Proposals (RFP).

Three companies responded to the RFP and two passed the preliminary examination stage.

The two firms then had their financial bids opened on December 16, 2015 in the presence of their representatives and later evaluated.

Star Software Technology Co. Ltd was the best evaluated bidder at a total cost of USD 22million.

Star Software Technology Co. Ltd was the only company willing to fund the project 100% using their own funds.

But as negotiations with Star Software Technology Co. Ltd were about to commence, a complaint was forwarded to the Inspector General of Government (IGG) alleging that UBC was in process to illegally awarding the DTT tender to the bidder and this made the IGG halt the procurement process until investigations were concluded.

IGG found that UBC had complied with the relevant laws for choosing a PPP partner and cleared the procurement as per their letter dated 27th July,2016,REF: HQT/19/1/2016.

UBC sent a team to conduct due diligence on Star Software Technology Co. Ltd The team comprised of officials from Ministry of Finance, UCC, UBC and the appointed Transaction Advisor. The team visited Rwanda and Tanzania where the Concessionaire is operating in a similar arrangement and later went to China, at the headquarters of Star Software Technology Co. Ltd.

The modalities of running the DTT network are well articulated in the draft concessional agreement and it addresses any shortcomings that may arise.

The procurement is based on the PPP Act and the terms spelt out in the Request for Proposal (RFP) document.

Negotiations between UBC and Star have been concluded and both parties have agreed to the terms and conditions in the draft concession agreement.

Among key issues agreed upon is the fact that the Concessionaire will finance, rehabilitate, manage, maintain, develop, operate and optimize the DTT and Radio Network for the period of 10 years.

All concession assets will return to UBC after the 10 years.

This has been approved by the UBC board and now what is left is for UBC to submit a detailed report and recommendation of the PPP Procurement Process to MoFPED. We will await the approval of MoFPED, Cabinet and Solicitor General before UBC can sign the contract with Star Software Technology Co. Ltd.

This will guarantee efficient service delivery as far as digital migration is concerned.

We believe that with the Signet–Star Software Technology Company Limited partnership in place, digital migration will be rolled out across the country faster and efficiently.

The focus will be to distribute digital signals countrywide in an efficient manner.

UBC can, therefore, categorically state that the allegations in the Sunday Vision are false.

WINSTON AGABA DAVID

Managing Director – Uganda Broadcasting Corporation (UBC)