The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Utilities Regulation and Competition Authority (URCA) has refuted Cable Bahamas’ concerns over the 13.2 per cent year-over-year increase in its operating budget, denying that this is to finance a ‘ramp up’ in preparation for energy sector regulation.

URCA, unveiling the statement of results for consultation over its draft 2015 annual plan, said the BISX-listed communications provider had suggested that it explain all changes to its budget in future annual plans.

“Cable Bahamas commented that it was very concerned about the significant increase of 13.2 per cent in URCA’s overall operating budget,” the communications regulator said.

“Cable Bahamas further commented that given the current economic state of the country, fiscal measures should be employed by URCA to reduce its overall expenditure.

“With regard to the increase in the budget for rent, Cable Bahamas suggested that URCA consider investing in a building as it would be a more reasonable and appropriate use of public funds compared to expensive annual rental contracts.”

Cable Bahamas questioned whether the budget increase was in preparation for URCA to take over energy sector regulation.

It also called for URCA’s future annual plans to disclose Value-Added Tax (VAT) allocations; explain its budget assumptions; explain annual variances; and include forecasts.

In reply, URCA said the increased budget was largely due to relocation of its offices, plus efforts to increase public awareness of its role and educate stakeholders.

“URCA assures Cable Bahamas that the increase in staff and relocation expenses is not attributable to future regulation of the energy sector,” the regulator added.

“It should be noted that staff costs decreased to 30 per cent of the total operating budget compared to 35 per cent of the operating budget for 2014, notwithstanding an increase in URCA’s staff complement.

“URCA reiterates that the increase in rent and utilities is attributable to URCA’s efforts to secure new premises due to the expiration of URCA’s lease and space limitations for URCA’s current premises.

“Therefore, URCA considered that the new premises must be significantly larger than the current premises in order to accommodate the anticipated increase in staff to carry out its existing regulatory functions. URCA, however, notes that the rental rate per square foot is significantly reduced.”

URCA added that its work would be financed by a separate budget if it ultimately took over energy sector regulation.