Cellular Companies Urge not to Pay USF and R&D Fund

Development projects by USF, worth more than Rs. 15 billion, came to a halt about nine months ago, resulting in non-utilization of Universal Service Fund (USF), reported ‘Dawn’.

As a result, telecommunication companies have threatened to stop making mandatory contributions in the form of access promotion charges to the USF which has now swelled to over Rs. 35 billion.

At least four leading companies are on record as having asked the government to stop collecting USF contributions for subsidizing telecom access in less developed areas under international obligations that envisage providing telecom and IT facilities to all citizens as a basic right.

“We propose that the further collection of USF and R&D contribution may kindly be capped till the current funds are efficiently consumed,” said a joint letter sent to the ministry of information technology and telecom by the four companies Mobilink, Telenor, Warid and China Mobile.

Dawn further reports that the USF has not awarded any contract for the launch of rural telecom services, broadband access, laying of optic fibre cables and multi-purpose community telecentres in more than 6,000 villages since March this year.

Similar projects in about 3,000 villages could not be completed or put into operation because the USF board of directors has failed to hold its meeting since March. In many cases, the bidding process has been completed but contracts could not be signed because of a legal authorization that the board of directors have to issue.

Interestingly, the USF has not been able to get its annual budget approved either by the government or its board of directors and has exhausted its reserve money while paying the staff salaries. The employees are unlikely to get salaries next month.

The USF is run on an ad hoc basis by a chief executive officer whose contract expired a few months ago. Its sister organization the IT Research and Development is without a head for almost a year.


  • Cellular companies should pay these USF and R&D. After all they are earning lots.