OTTAWA and GATINEAU – It’s been nearly two years, a court appeal and many complaints since the original decision, but the CRTC today revealed how the $650 million or so in the so-called deferral accounts will be spent.
The Commission approved several initiatives that will benefit Canadians with disabilities and expand broadband services to rural and remote communities. The major local telephone companies were also directed by the Commission to finalize proposals for the dispersal of the funds in their deferral accounts.
"Today’s decision will not only make telecommunications services more accessible to all Canadians, but also serve to enhance social and economic development in underserved communities," said Len Katz, the CRTC’s vice-chairman of telecommunications in the press release.
The proposals approved by the Commission include initiatives to improve accessibility to telecommunications services for persons with disabilities in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario and Quebec. In developing their proposals, the companies consulted with federal and provincial governments, national and provincial organizations representing persons with disabilities, and researchers in the field.
With this decision, as well as one issued in July 2007, funds will also be used to expand broadband services to more than 350 rural and remote communities in British Columbia, Alberta, Manitoba, Ontario and Quebec.
Then, any funds remaining in the deferral accounts will be rebated to the relevant residential subscribers living in urban areas in these provinces. The commission directed the major local telephone companies to file, by March 25, 2008, proposals outlining how rebates could be most effectively made both in terms of benefits to customers and minimal disruption to companies.
It is estimated that over $650 million has accumulated in the deferral accounts since they were created in 2002. Bell Aliant, Bell Canada, MTS Allstream, SaskTel and TELUS were required to place into their accounts an amount equal to the revenue reductions that would otherwise have resulted from the application of the price cap formula.
In 2002, the Commission set out its price cap framework, which included rules governing the rates charged to residential and business consumers as well as to competitor companies by the major local telephone companies. One of the elements of the price regulation regime was the deferral account.
Price cap regulation places a ceiling on prices a company can charge its customers, explains the Commission’s release. At the same time, in order to avoid an adverse impact on local competition as a result of mandated rate reductions under the price cap framework, the Commission required each major local telephone company to create a deferral account. The companies were requested to place into those accounts amounts equal to the revenue reductions that would otherwise have resulted from an application of the price cap formula.
In 2006, the Commission determined that the funds that had accumulated in the deferral accounts should be used for the expansion of broadband (high-speed Internet) services and for initiatives to improve accessibility to telecommunications services for persons with disabilities. The Commission also concluded that any funds remaining after these initiatives had been approved should be rebated to the companies’ residential local service subscribers in non-high-cost serving areas.
In 2007, the Commission revised its price cap framework and eliminated the deferral account mechanism. As such, no funds will be accumulated in the deferral accounts on a going forward basis.
The Commission has approved several proposals to improve accessibility to telecommunications services for persons with disabilities in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario and Quebec.
The proposals included initiatives to:
* Introduce Internet protocol relay, a text-based tool that would allow persons who are deaf, hard of hearing or have difficulty speaking to communicate through the telephone system with hearing persons through a relay agent;
* Introduce video relay service, a service that would allow a person using sign language and another person using voice to communicate through a relay agent via high-speed Internet and video camera;
* Improve voice activated dialing service;
* Enhance directory assistance;
* Improve access to certain telecommunications services for persons with sight and mobility disabilities;
* Improve accessibility to the websites of some of the major local telephone companies;
* Establish a single point of contact for persons with disabilities to receive customer service tailored to the specific needs of the customer;
* Conduct research into the needs of persons with disabilities during the development process of new products and services; and
* Provide free teletypewriter (TTY) units to all transition houses in Saskatchewan.
The Commission has approved initiatives to expand broadband services to a large number of rural and remote communities, or nearby areas. Click here for that list, and here for the full decision.
