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Output Expense > Policy Advice > Communications

This output expense provides policy advice on information technology, electronic commerce, the Government's broadband strategy, telecommunications, postal services and the management of radio spectrum.

Quantity, Quality, Timeliness and Cost

Work Programme

All policy advice projects were delivered in accordance with the terms of the work programme as agreed with the Minister. Changes to deadlines were negotiated with the Minister.

The following outputs were included in this output expense for 2005/06.

Information Technology Policy

This output involves policy advice on information technology and electronic commerce, including international technical developments and regulatory frameworks relevant to electronic commerce, and the Government's broadband and industry development strategies. In 2005/06 the output included the following.

Developing and implementing a Digital Strategy for New Zealand covering the major areas of transforming government, digital divide, business growth, security, infrastructure and content.

The Digital Strategy is a whole-of-government initiative, involving many government departments, and led by the Ministry of Economic Development. The Digital Strategy, which was launched in June 2005, is now bedding in and has moved from being a policy document to a core implementation phase. A governance structure has been put in place to oversee implementation. In regard to the three major grant schemes funded through the Digital Strategy (Broadband Challenge, Community Partnership Fund and Probe extension) all three have commenced, criteria have been developed for the allocation of the funding and evaluation programmes have been put in place.

Supporting the passage of the Unsolicited Electronic Messages Bill through Parliament.

The Unsolicited Electronic Messages Bill was drafted and introduced and is currently with the Commerce Select Committee. It is due for report back in August/September 2006.

Telecommunications and Postal Policy Advice

This output involves policy advice on services and activities under the Telecommunications Act 2001 and on the letter post market. The output includes the development of regulations where required and representing New Zealand's interests at international for a relating to telecommunications and postal services. In 2005/06 the output included the following.

Providing policy advice on any required amendments to the Telecommunications Act 2001 arising from the implementation review of the Act, and supporting the passage of a consequential Telecommunications Amendment Bill through Parliament.

Following a discussion document seeking comment upon streamlining of the telecommunications regulatory regime, Cabinet papers and drafting instructions were prepared to develop an amendment Bill. Following the general election in November 2005, the Minister directed that a further major stocktake of the sector take place to ascertain whether New Zealand was keeping pace with other OECD countries in the deployment of broadband and how adjustment of the regulatory environment might best support the New Zealand economic transformation agenda.

As a likely outcome of the stocktake review was the need for additional legislative and regulatory changes, the stocktake was undertaken in parallel with the review of the Act. The stocktake was completed in late April 2006 and policy papers tabled with Cabinet on 3 May 2006. The papers recommended further major reform of the sector including introduction of local loop unbundling, unconstrained bitstream service, naked DSL service, a number of future reviews into aspects of the sector, and additional legislative changes over and above those recommended in the Act review. The new Bill was introduced on 26 June 2006 and had its first reading on 29 June 2006.

Providing policy advice and implementing any regulated service arising from further Commerce Commission determinations under the Telecommunications Act 2001.

Advice was provided on the Commerce Commission's initial recommendations on mobile termination. The Commission subsequently reconsidered its recommendations and reported again on 21 April 2006. Further advice is now being provided.

A benchmarking report was completed and published, measuring and comparing the performance of New Zealand's ICT sector with other OECD countries.

Providing advice on Telecommunications Service Obligation (TSO) competition.

Work on the TSO was incorporated into the regulatory stocktake discussed above.

Radio Spectrum Policy Advice

This output involves policy advice on the management and allocation of the radio spectrum. In 2005/06 the output included the following.

Finalising offers for the renewal of AM/FM broadcasting spectrum rights and providing advice on arrangements for the renewal of cellular spectrum rights.

The renewal offers associated with AM/FM broadcast licences have been delayed until after the Communications Bill is passed later in 2006. A Cabinet paper and discussion paper on arrangements for the renewal of cellular rights was provided in early July 2006.

Improving access to the radio spectrum by providing advice on competition issues and arranging new allocations of spectrum, with an emphasis on enabling new technologies and services for the benefit of the consumers.

Broadcasting

Advice was provided on frequency availability and further allocations in the FM broadcast band, including opportunities for greater participation from local and community stations. Advice was also provided on planning for the introduction of new digital television and radio broadcasting technologies.

New Technologies

Advice was provided on spectrum for new broadband wireless access technologies and services, including future spectrum allocation opportunities, and the allocation of Crown-retained spectrum at 3.5 GHZ. Initial licensing arrangements were established for ultra wideband technologies, including vehicular anti-collision systems.

Spectrum Allocation Policy and Regulatory Frameworks

Advice was provided on radio spectrum related competition issues, auction design considerations and the new "managed park" approach to allocating spectrum. The Communications Bill (including amendments to the Telecommunications and Radio Communications Acts) has progressed to Select Committee stage. The Bill addresses urgent matters relating to the renewal of spectrum rights.

Cost

(Figures are GST exclusive)

Sources of Revenue Other

Major Budget Variances

The Supplementary Estimates changes reflected a transfer from Vote: Energy to meet pressures due to the telecommunications stocktake and judicial reviews ($450,000) and a transfer from the multi-year appropriation Digital Strategy - High Speed Connectivity for Growth to support administration of the Digital Strategy contestable funds ($100,000), partially offset by a transfer to Vote: Community and Voluntary Sector reflecting a transfer of responsibility for the administration of the Digital Strategy - ICT Capability, Skills and Content Development programme to the Department of Internal Affairs (-$104,000).

The variance between 2005/06 and 2004/05 for actual expenses is mainly due to the administration of the contestable funds relating to the Digital Strategy, the telecommunications stocktake and judicial reviews.

Output Expense > Management and Enforcement of the Radiocommunications Act 1989

Description

This output expense provides services in relation to the management of the Radiocommunications Act 1989 by establishing technical arrangements for the allocation of radio spectrum, including international coordination and representation, issuing licences, providing licence registration services and access to the information held on the register of radio frequencies, assisting with the resolution of radio spectrum interference complaints, ensuring compliance with and enforcement of the statutory responsibilities of all spectrum users, and management of radio spectrum sales.

Quantity, Quality, Timeliness and Cost

(Performance standards and forecast volumes are in brackets where applicable.)

Quantity

Numbers actioned:

• 3,011 (3,000) new radio licence applications;
• 356 (250) new spectrum licences;
• 2,364 (4,000) modifications to radio licences;
• 1,432 (800) instrument registrations; and
• 908 (1,100) interference investigations.

Volumes are demand driven. While the numbers forecast for spectrum licences and instruments registered were based on historical trends, it is difficult to predict how many applications will be received in any one year because applications for new services are dependent on technology trends, equipment and spectrum availability. Attributable to higher than expected volumes in 2005/06 of new spectrum licences and instrument registrations is the rollout of 3G cellular networks by both Telecom and Vodafone, and the downward trend in interference investigations is due to consumers moving from terrestrial to satellite based television services that are less prone to interference.

Audits conducted:

• 267 (250) Electro Magnetic Compatibility (EMC) supplier compliance folder audits. (All suppliers using the C tick label are required to maintain a compliance folder for each product supplied. This folder contains specified documents demonstrating the product's compliance with applicable standards and is subject to audit);
• 445 (400) EMC product audits;
• 2,562 (1,500) licence audits, including new licence audits and cancelled licences; and
• 67 (60) site audits.

The higher than forecast number of licence audits resulted from the compliance programme initially focusing on large telecommunication sites that involve a greater number of licences.

Quality

All (all) licences were issued and compliance audits made in accordance with established ISO 9001 processes and ISO certification was retained following quality audits.

Timeliness

98% (95%) of correctly completed spectrum licence instruments were receipted and acknowledged within two (two) clear business days of receipt.

98% (95%) of all correctly completed radio and spectrum licence applications were receipted and acknowledged within two clear business days of receipt.

Documented interference complaints were responded to and remedial action commenced as follows:

• for public safety services, within two hours of being lodged in 100% (95%) of cases;
• for commercial radiocommunications, within one working day of being lodged in 99% (95%) of cases; and
• for radio and television broadcasting, within two working days of being lodged in 100% (90%) of cases.

Radio Spectrum Planning

This output involves advice on technical arrangements for the allocation of radio spectrum. In 2005/06, the output included the following.

Representing New Zealand's radiocommunications interests at the International Telecommunications Union (ITU) and other international fora.

The Ministry participated in ITU, Asia Pacific Telecommunity, and Institute of Electrical and Electronic Engineers fora on methods to improve the international radio spectrum regulatory framework and new technologies such as ultra-wideband devices and 4G mobile. The Ministry also convened meetings of the Radio Sector industry group in July 2005, November 2005 and March 2006 to discuss and develop New Zealand's position on international spectrum issues.

Working with Australia to develop a strategy for an Asia-Pacific multi-lateral harmonisation agreement concerning Electro Magnetic Compatibility (EMC) and radiocommunications standards.

This item was removed from the 2005/06 work programme as resources were required to be diverted to other higher priority items. APEC is also conducting a review of the effectiveness of mutual recognition agreements and it would have been premature to form any conclusions prior to the completion of that review.

Conducting sales of radio spectrum rights as directed by the Government.

Renewal of AM/FM licences: Technical planning was largely completed, however final offers have been delayed until after the Communications Bill has been passed.

Renewal of UHF TV licences: Responses to offers were received and certification and settlement of licences will be completed in 2006/07.

Allocation of Crown retained 3.5 GHz Broadband Wireless Access (BWA) spectrum: The allocation round was completed in June 2006 with settlement to be completed early in the 2006/07 year.

Provision of engineering planning advice to support the development of radio spectrum policy advice and the management and enforcement of the Radiocommunications Act 1989.

Advice was provided on a range of issues, including ultra-wideband technology, digital radio broadcasting, spectrum for future broadcasting studio-to-transmitter linking technologies and services, digital television and spectrum for Broadband Wireless Access.

Cost

(Figures are GST exclusive)

Sources of Revenue Other

Major Budget Variances

The Supplementary Estimates change reflected a transfer from Vote: Energy to meet pressures related to the renewal of rights to AM/FM broadcasting licences and costs associated with the 3.5 GHz spectrum allocation project ($125,000).