Eastern Cape and Sita reach deal on broadband project

The State Information Technology Agency (Sita) and the Eastern Cape provincial government have reached a settlement in the Bhisho High Court over a multi-million rand broadband project, the City Press reports.

This project aims to connect provincial departments in the Eastern Cape with Wi-Fi through the provision of wide-area networks.

The two entities were previously at an impasse regarding the rollout of the project, with the provincial government wanting to base the rollout on an existing project and Sita labeling the practice “illegal”.

Sita accused the Eastern Cape of not following an open bidding process for the project and sought a review of the application in court.

The parties reached a settlement earlier this month, with the court ruling that any additional work related to broadband services for the Eastern Cape government would be provided by Sita through an open tender process.

It added that if any of the parties commit a breach of the agreement and fail to remedy the transgression within seven days, the other party will be entitled to approach the court for an order.

The High Court in Bhisho had previously ruled in favour of Sita in the dispute over the rollout of broadband.

Using its existing Master Service Agreement with Telkom, Sita suggested that the Eastern Cape upgrade 160 provincial government sites that were already connected.

Liquid Telecom, which provides broadband to the Western Cape, was able to offer much better pricing, however, and the province sought to use its services instead.

Eager to roll out

Eastern Cape Premier Phumulo Masualle said he was pleased with the new settlement, though.

He said he was happy no corruption was found related to the broadband project, but added that the provincial government was still under scrutiny from the Auditor-General regarding the possibility of irregular expenditure.

Sita CEO Stumo Mohapi said he was relieved about the matter, and that work would soon begin.

The project will see 7,000 sites across the province connected by broadband, with work on 4,300 of these sites being subject to an open tender.

“The Eastern Cape provincial government and Sita will sign a 10-year broadband contract,” Mohapi said.

“We have accepted we would have to deliver value for money as was the case in the Western Cape.”

“We are also doing due diligence, which will inform what the value of the project will be in the next 10 years,” he added.

Fees and infrastructure

The Eastern Cape previously stated that the average monthly costs for each site would be as follows:

  • R26,000 to Sita as a port charge.
  • R7,000 to Telkom for line rental.

These fees would be for contended 10Mbps lines from Telkom, and the total price for 400 sites over a five-year contract would reach R885 million.

Liquid Telecom offered much better pricing – 71% cheaper than Sita – in addition to uncontended 10Mbps connections.

Following this court settlement, Liquid Telecom will complete the work it has already begun on the government sites.

Now read: How the DA will make Internet access cheaper

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Eastern Cape and Sita reach deal on broadband project