GRA looks up to ICH policy to boost revenue as oil profits dip

As stakeholders in the economy continue to ponder the expected negative effect of the short fall in crude oil revenue, there might be light at the end of the tunnel as the soon to be launched Interconnect Clearinghouse (ICH) policy is set to help boost the revenue accruing to the Government from telecommunications services.

The ICH is set to be operational from May 2015.

It will be fitted with inter-carrier switching, billing, and settlement infrastructure, as well as revenue assurance, and anti fraud (Simboxing) mechanisms on all network traffic monitoring platforms.

According to Adom News sources, the revenue boost to the Ghana Revenue Authority (GRA) and, by extension, the state from the ICH will result from a number of ways: eliminate revenue diversion by blocking simboxing, ensure proper monitoring of all on-net and off-net traffic, prevention of capital flight and also ensure a more robust telecom industry.

Kill Simboxing

Simboxing has resulted in significant loss of revenue to the Government in the past, and continues to deny government money, as revenue accruing to the Government from international traffic is diverted and passed through as local traffic resulting in lower payments to the Government.

The solution to be implemented by the ICH, according to sources, will ensure active detection and elimination of Simbox activity, unlike the current situation where detection is done after the occurrence of Simboxing and therefore not preventable.

Real time monitoring

The infrastructure to be deployed by ICH will ensure that there's accurate record of all off-net (interconnect traffic), and that will enable the actual volume of traffic passed between the operators to be properly reported to the Government by an independent body, unlike the current situation where the Government depends on the telecom operators to declare the volume of traffic and the revenue accruing to the government by themselves.

The interconnect switch will generate independent call detail records (CDRs) for all interconnect traffic that passes through it, while interfaces will be created with the telecom operators to properly monitor their on-net traffic in real time as well.

"On a daily basis, the total traffic passed and the revenue due to all parties will be uploaded into the online portal where all stakeholders, including the GRA, will be able to review and update their records," the source said.

Prevention of capital flight

All operators in Ghana currently depend on international clearing houses for the settlement of all roaming and international traffic, and this has led to significant foreign payments being made to international clearinghouses such as Syniverse, Starhome Mach, TNS and Comfone. This is a typical situation of capital flight from Ghana.

With the launching of the Ghanaian clearinghouse, this service will now be performed locally in Ghana. This will prevent capital flight; create local employment; and lead to development of local ICT expertise. The NCA has in the past said it would even enable telcos cut down on their roaming cost and therefore reduce roaming tariffs for customers.

?Robust telecom industry

Proponents of the ICH insist it will lead to a more robust and reliable interconnect regime in Ghana. This will result in higher quality of service and call completion rate to the subscribers.

They argue that, contrary to criticisms, ICH will lead to higher revenue regenerated by the telcos at a lower operating expense, and ultimately result in higher income to the GRA in the form of taxes and levy.

Critics

Meanwhile, critics have raised questions about ICH eavesdropping on people's private calls, and intercepting private messages, but Adom News gathered the proposed ICH will not have the ability to eavesdrop.

There have also been questions about why the need for ICH when the telcos have a working interconnect arrangement among themselves.

Indeed, interconnect clearinghouse expert Martin Browne wrote in an article that "the interconnect clearinghouse is most appropriate where a country or geographical area is in the process of deregulating and operators have not yet invested too heavily in individual interconnect solutions."

The telcos insist they have invested heavily into interconnect systems based on the NCA's own insistence, so they do not see why NCA now wants to make their heavy investment redundant and compel them to connect to a new ICH.

But the proponents of ICH insist the current arrangement does not allow the state to do real time monitoring for revenue assurance for the state.

Again, there have been issues about ICH impacting negatively on quality of service, but the NCA has said the ICH would be required to meet the same quality of service standards as the telcos, so no room for the ICH to fail on service quality.

The issue about ICH leading to higher cost of telecom call was also answered by the NCA. The regulator said they are footing the bill for the setting up and operations of the ICH, so it will not cost telcos and their customers anything.

But the telcos insist that switching to the ICH system means they have to lay off workers who work on their interconnect platforms and also find money to defray the investment made into their individual interconnect systems. That, according to them, would be passed on to the consumer to pay.

Meanwhile, some individuals have sued the NCA, telcos and the selected ICH operator, Afriwave Telecom Ghana Limited. The court is being asked to determine the legality and relevance of the ICH.