The mobile telephone operators, under the aegis of Association of Licensed Telecommunication Operators of Nigeria (ALTON), had in a letter to Nigerian Communication Commission (NCC) proposed a 40 per cent tariff hike. According to them, the increase in tariff has become necessary as a result of the 2020 recession, the Russia/Ukraine war, high cost of energy, poor ease of doing business, and inflation, which has raised operating expenses by over 35 per cent.
The telecoms operators expressed worry over multiple taxes and levies imposed on them by the three tiers of government and harassment by government agencies. They also decried the high cost of Right of Way (RoW), which is the major cause of poor network services across the country. As a result of rising operational costs and other exigencies, the mobile telephone operators say it has become expedient for the sector to undergo “cost adjustments through the intervention of the NCC in order to minimise the impact of the challenging economic issues.”
Inasmuch as we understand the plights of telecommunications operators, we believe that the plan to raise the price of calls, short message (SMS) and data by 40 per cent at this point in time is insensitive and unacceptable. If the proposed price hike is approved by the NCC, the price floor of calls will rise to N8.85k per minute from its present price of N6.4, while that of SMS will increase to N5.61 from the current N4, excluding 7.5 per cent VAT. Any tariff increase now will amount to additional burden to many Nigerians already saddled with hike in electricity tariff, Value Added Tax (VAT) as well as sundry bank charges.
Considering the plight of many Nigerians, we urge the telecoms operators to shelve their plan to increase the price of their services until when the economy improves. The NCC should intervene and ensure that the price hike is postponed. No doubt, the prevailing harsh economic condition in the country has impacted negatively on almost all business operations. The disposable income of most Nigerians has been at its worst level in so many years. With these in mind, the best thing the operators should do now is to jettison any plan to raise tariff.
The recent barring of about 71 million lines of subscribers by their various network providers at the instance of the NCC and the Minister of Communications, Isah Pantami, for not meeting the deadline for SIM-NIN linkage must have adversely affected the operators. The money lost as a result of the barred lines cannot be recovered through the planned price hike. Instead, the telecoms operators can still dialogue with the government and the NCC on the need to extend the deadline for SIM-NIN registration.
It is instructive that the NCC has assured subscribers that there should be no tariff hike by any of the mobile providers without its approval. This may have also doused tension following threat by subscribers, under the aegis of National Association of Telecommunication Subscribers, to mobilise its members against the planned tariff increase. According to NCC, any cost determination should be the outcome of transparent studies, and should enhance healthy competition among operators and provide wider choice for subscribers, as well as ensure sustainability of the sector. However, the NCC points out that while there could be justifiable reasons for the operators to demand a raise in tariff, the operators are not allowed, either individually or collectively, to increase tariff without its approval. The current plight of Nigerians must be put into consideration before any tariff hike can be contemplated. Any increase in tariff now will hamper social communication. For the past 22 years that GSM began operation in the country, it has impacted positively on other sectors and the operators have gained enormously. Within this period, the telecom sector has emerged as the healthiest sector in the economy. Agreed that it needs to make profits, it should not be at the expense of the subscribers. While not ruling out any modest price hike in future, let the operators strive so much to improve their services. Many telecoms subscribers are still grappling with call dropping, inaudible calls, SMS not delivered but paid for, among other challenges. At the same time, we implore the government to review the tax system in such a way that it will not negatively affect business operations.