Politician Vasudeva Nanayakkara, who drew attention as a public activist as the successful petitioner in the Lanka Marine Services Ltd., (LMSL), is now threatening to take up another public interest issue in court – failure of the Telecommunications Regulatory Commission's (TRC) to comply with a Supreme Court (SC) order of May 7, 2007 to draw up a new tariff structure.
In a letter dated October 10, 2008 to TRC Director General Priyantha Kariyapperuma – copied to The Sunday Times - Mr. Nanayakkara states that 'OPA's experts in their presentation to the TRC, around March 2008, explained and established that the TRC's tariff proposal recommended to the SC is flawed mathematically and technically and that it is in violation of the provisions in the Sri Lanka.
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| Vasudeva Nanayakkara |
Telecommunications Act No. 25 of 1991 amended by Act No. 27 of 1996 on protection of public interest.'
The letter went on to state that the tariff proposal specifically violates the Telecommunications Act in terms of non compliance of the Supreme Court order dated May 7, 2007 by the TRC's proposal given to the SC in terms of the said order that the new tariff should yield a reduction of 20-25% (to any user billed as per pre-Nov 2007 tariff based on unit metering and charging). The letter also states that the TRC failed to report the key facts presented by the late Mr. Peter Jayasekera, a consumer rights activist, during the negotiations ordered by the SC that justifies the necessity to reduce the call charge at least by 25%.
In particular, Mr. Nanayakkara writes that the TRC did not put up to the SC that the per-line operating costs of the SLT since its privatization in 1998 has been declining at around 15% per annum. The TRC also provided disinformation to the SC, to conceal the urgent need arising from above, to update the outdated X factor of price cap CPI – X. The X factor is not a one-time set value. Its regular revision is an essential requirement that underpins its core aim which is to sustain market competitiveness in the fact of advancing technology and declining costs, the letter said.
Further, Mr. Nanayakkara said the TRC also did not inform the SC of the abrupt suspension of this licence condition in 1997, on the unjust insistence of Nippon Telephone and Telegraph (NTT), at the time it entered into a joint agreement with SLT, which stalled reduction of tariffs. The TRC also did inform the SC that it failed to revise X in 2002 when the suspension was terminated in 2002 and the Government took measures to revamp the market competitiveness.
Mr. Nanayakkara states that to conceal the distortions the TRC refrains from estimating the reduction for usage in the range 499 to 799 or more metered units as required in the SC order. The methodology of TRC's proposal due to reasons aforementioned is flawed fundamentally, mathematically and technically. The letter states that this flawed methodology resulted in the tariffs of most call types defined by local and long distance, recommended to the SC, by the TRC to be priced nearly 30% above the corresponding pre-Nov 2007 tariff. Therefore, the bill reduction of most users with varying usages and mix of call types will not comply with the SC order.
The TRC in presenting the flawed information to the SC abused the trust placed in the regulator by the public as the apex statutory body of the telecom sector and thereby wrongly represented facts which lead the SC to agree with TRC's recommendation. The TRC despite the assurance given to the said experts in March 2008 that it would rectify the flaws on the understanding that the experts would not divulge the facts to the public has not yet rectified the flaw or provided the information requested in OPA's letter of December 31, 2007. Mr. Nanayakkara writes that the request of the regulator not to divulge facts to the public is another instance of violation of the cardinal regulatory requirement of transparency. In this instance, the regulator should have announced the flaws to the public.
Mr. Nanayakkara states that in terms of the provisions of the aforesaid Telecom Act, he requests that the TRC announces to the public through all the print and electronic media all the flaws in the tariff proposal put up to the SC by the TRC, the corrected tariff conforming to the SC order to reduce the bill of any user by 20 – 25% with respect to the pre-November 2007 tariff and the date by which the corrected tariff will come to force and the procedure for refunding the excess charged.
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