Regulatory Authority Financial Statements Tabled

Minister of Home Affairs Walter Roban tabled the annual financial statements of the Regulatory Authority for Fiscal Years 2014-2015, 2015-2016, and 2016-2017. in the House of Assembly today.

“The Regulatory Authority [RA] is a self-funding body, responsible for the implementation of policy through the application of the relevant legislation, and although it is independent, it must account for its activities and expenditures in annual reports,” the Minister said.

The documents follows below:

• Regulatory Authority Activities & Audited Financials April 2014 – March 2015 here [PDF]

• Regulatory Authority Activities & Audited Financials April 2015 – March 2016 here [PDF]

• Regulatory Authority Activities & Audited Financials April 2016 – March 2017 here [PDF]

The Minister’s full statement follows below:

Mr. Speaker, as the Order Paper indicates, I have tabled the annual financial statements of the Regulatory Authority for Fiscal Years 2014-2015, 2015-2016, and 2016-2017.

Mr. Speaker, the Regulatory Authority [RA] is a self-funding body, responsible for the implementation of policy through the application of the relevant legislation, and although it is independent, it must account for its activities and expenditures in annual reports. According to Section 47[2] of the Regulatory Authority Act 2011, the audited annual financial statements must be laid before both Houses of Legislature, and so in order to be compliant with the law, I present these documents here today. These reports have all been audited by the Office of the Auditor General, also as required by the Regulatory Authority Act 2011.

Mr. Speaker, I wish to take this opportunity to point out some of the Authority’s achievements year by year. In order to give some context, from its inception in January 2013 until October 2016, the RA was responsible for the regulation of the electronic communications sector. In October 2016, the Regulatory Authority was given the additional mandate of the regulation of electricity, since which time the RA has been a dual-sector regulator.

Mr. Speaker, in Fiscal Year 2014-15, the RA implemented the Model Access and Interconnect Agreement, which effectively applied ex-ante remedies to those who were deemed to have significant market power and resolved conflicts between providers on matters of interconnection and network access to create a more competitive environment. That year also saw the administrative process of consultation that led to the adoption of Adjudication Rules, which are the established procedures the RA follows in its decision-making process. There were also various cost reductions applied as in the case of the Local Access Charge and the BTC MAIA Discount Order.

Mr. Speaker, among the highlights of fiscal year 2015-2016 was the freeing up of the 700 mega-hertz spectrum, which allowed that band to be used for the mobile communications subsector. This paved the way for the introduction of the high demand spectrum, otherwise known as ‘4G’, providing better service to customers. There were also concentration reviews undertaken in the electronic communications sector that were necessitated by various mergers and acquisitions, among which was the Digicel/BTC concentration. Other activities of the RA in that fiscal year included improvements to its Information Technology network and information management system, vital for ensuring that security and effective management of information were maintained and enhanced.

Mr. Speaker, fiscal year 2016-2017 saw the acquisition of an overdraft facility to assist the RA with the funding needed to take on the regulation of the electricity sector, as noted previously. This involved significant preparation and the engagement of consultants to ensure that the RA was sufficiently prepared for this expanded mandate. Additional staff were hired, including subject matter experts and legal counsel, ensuring that capacity would be built to handle this increase in responsibility.

Mr. Speaker, the RA conducts all its activities under the watchful eye of the public, a public that demands quality of services from its utilities and that requires constant vigilance from its regulator. In these early formative years of the Authority, it should be expected that there is a great need for external consultants, which have typically used a good portion of the Authority’s working capital. It is also expected that, over time, the RA will rely less and less on these external services as they build capacity and experience within. All the details of the activities of the RA, from 2014 to 2017, are found in these audited reports.

Mr. Speaker, I would be remiss if I did not note another important function of the RA, which is collecting revenue on behalf of Government paid by the various carriers into Government Authorization Fees. The RA collects these fees and passes them through to Government, amounting to over thirty-six and a half million dollars during these three years of annual reports alone.

Mr. Speaker, the RA has done and continues to do vital work for the people of Bermuda, and we look forward to tabling the 2017-2018 report once complete and audited.

Thank you, Mr. Speaker.

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