The National Association of Telecoms Subscribers (NATCOMS) has announced plans to sue the Nigerian Communications Commission (NCC) over the recently approved 50 percent tariff hike.
On January 20, the NCC approved the request by telecommunications companies (telcos) to increase tariffs. The adjustment followed concerns raised by the Association of Licensed Telecommunications Operators of Nigeria (ALTON) and the Association of Telecommunications Companies of Nigeria (ATCON), which had called on the NCC to review call tariffs upwards.
Karl Toriola, the chief executive officer (CEO) of MTN Nigeria, revealed that telcos had initially requested a 100 percent increase in tariffs. However, the NCC capped the increase at 50 percent, half of what the telcos had demanded.
‘50% Tariff Increase Not Acceptable’
In reaction to the development, Deolu Ogunbanjo, president of NATCOMS, criticised the NCC for failing to involve subscribers in the decision-making process.
Ogunbanjo explained that NATCOMS understood the challenges faced by the telecommunications industry and had proposed a 5 percent to 10 percent marginal increase in tariffs as a more reasonable solution. He described the approved 50 percent hike as unacceptable.
“This will affect everyone from the biggest industry to the smallest company, such as the Point of Service (POS) operators,” Ogunbanjo said. “It will increase operational costs.”
He further stated that economic experts had analysed the telecom sector and concluded that it was in critical condition, requiring urgent attention.
“We now depend on telecoms for our meetings, for the banks, everybody depends on it even the education sector, yes, a lot of things depend on it,” he said. “So, that is why we painfully agreed that, look, a moderate or marginal five percent to 10 percent increase will be fine.
“You know, we do not mind an increase if it is to salvage the industry that is helping us, that means so much to us and that is also contributing double-digit to Nigeria’s gross domestic product (GDP).
“So, we appreciate that. It’s painful, but we agreed. We said, okay, we will not mind if it is just a five percent to 10 percent increase.”
Ogunbanjo suggested that instead of implementing a steep tariff hike, telecom operators should explore alternative financing options, such as raising funds through the Nigerian Exchange.
“The industry operators can opt for an Initial Public Offer (IPO) for Nigerians to buy shares in their companies as a way of raising funds,” Ogunbanjo added.
“However, a situation where a whole 50 percent is granted for tariff hike is not cheap and it is a no! no! from us subscribers. I mean, for what we are already going through, no for us, we will challenge this in court.”
On January 16, Bosun Tijani, the Minister of Communications, Innovation, and Digital Economy, stated that any hike in telecom tariffs would not exceed 60 percent.
