NCC reacts to telecom operator’s proposed 40% tariff hike

The Nigerian Communications Commission (NCC) has said the proposal of telecom operators for a 40 per cent end user tariff on services is not realistic this year.

The operators, acting under the aegis of the Association of Licensed Telecommunication Operators of Nigeria (ALTON), in a letter to the NCC, had proposed a 40 per cent increase in the cost of calls, short messages service (SMS) and data as a result of the rising cost of running a business.

Based on their proposal, the price floor of calls will increase from N6.4 to N8.95 while the price cap of SMS will increase from N4 to N5.61.

Consistent with Section 108 of the Nigerian Communications Act 2003 (NCA 2003), the NCC is responsible for the approval of tariffs and other charges for the provision of service by licensed telecom service providers.

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The Chief Executive Officer, NCC, Prof Garba Umar Danbatta, who said the Commission was in receipt of the request explained that no action would be carried out on it this year because funds are not available to undertake cost-based study, which will determine the suitability or otherwise of any hike in tariff.

“The proposal is under consideration by the Commission and there is a need to do a cost-based study on the market segments. There is, however, no provision for doing this in the 2022 budget,” Danbatta wrote in an e-mail.

“With respect to voice and SMS cost, ALTON respectfully requests the commission to consider a mark-up approach to address the upward price adjustment desirable for the industry. We have enclosed herein and marked ‘Annexure 1’our proposal in that regard.