Examination of Witnesses (Questions 60
- 79)
TUESDAY 15 JANUARY 2002
MS VANESSA
LAWRENCE, MR
DAVID WILLEY
AND MR
STEVE ERSKINE
Mrs Dunwoody
60. Is there evidence to make sure those prices
are clearly and easily available to everybody?
(Ms Lawrence) Yes.
61. So if I came on to your website I would
find that if I were trying to organise a local leaflet?
(Ms Lawrence) I would think so, yes. You mentioned
about small groups who perhaps want to do sketch maps. We were
doing a little calculation yesterday. Let us say you have got
an A5 booklet which you are going to sell but which you are only
selling for three or four pounds. It is just a contribution. You
have 15 sketches within it and it is A5. We worked out that you
would be paying to that 15p per copy, so it is a very small amount.
We have worked over the last 15 months to make sure that that
is accessible to people.
Chairman
62. You just use the 1925 map which is out of
copyright.
(Ms Lawrence) Mr Bennett, there are lots of ways around
it, I am sure.
Mrs Ellman
63. Would you welcome HMSO as your regulatory
body?
(Ms Lawrence) We are in a very interesting position
regarding regulation. We obviously wish to continue to make sure
we are very open about what we do. We are happy if more and more
people want to get to know what we do. There has been a lot of
discussion in the industry about whether there should be a regulator,
whether HMSO is the right regulator, and certainly we have watched
this debate with interest. Currently HMSO plays a very important
part with us and we are very happy with our working relationship
with them.
64. What is your view on regulation?
(Ms Lawrence) My personal view on regulation? Having
worked overseas in America I have looked carefully at regulation.
I believe light touch regulation is fine.
Chairman
65. You mean a regulator who does not cause
you any problems?
(Ms Lawrence) No. May I draw your attention to the
fact that in America they have had regulators for, say, 25 years
in the utility sector. They have worked quite well with them in
collaboration with people understanding the business challenges
as well as understanding the regulatory needs.
Mrs Dunwoody
66. We are not talking about California Energy
here, are we?
(Ms Lawrence) No, we are not, Mrs Dunwoody. There
are many other regulators and many other utilities besides California.
67. I just want to be clear.
(Ms Lawrence) I could not comment on that. Light touch
regulation certainly seems to have made sure that the business
is able to go about its duty but still bears representation through
the regulator. However, in other countries you can see cases where
the regulator is practically running the business.
Mrs Ellman
68. What would you see as appropriate for Ordnance
Survey here in this country now?
(Ms Lawrence) Our current relationship is that HMSO
acts in that way with us at the moment. Very much a light touch
regulation is what I think is appropriate here. We are also small
enough for people to come and talk to us at any time.
69. Do you not feel it needs a firmer touch
of regulation given the very powerful position you are in as monopoly
supplier for the central information, the setter of prices? You
are in a very powerful position.
(Ms Lawrence) Perhaps I could first suggest, Mrs Ellman,
that we are not actually a monopoly. At large scale increasingly
and also at smaller scale for a long time we face competition.
The only monopoly area is the work we do in the uneconomic areas
that we have talked about which are covered by NIMSA. That is
the nearest thing to a monopoly. As we are facing increasing competition
every six months I think stronger regulation would be very inappropriate
for the whole of the community. We have to be agile enough to
be able to move to ensure that our own business is not eroded
together with that of our partners. As soon as it does start to
be eroded and as market share is taken by overseas organisations
it certainly could be very damaging to this country's relations
in the industry.
70. Where do you feel that the organisations
or individuals who have concerns about Ordnance Survey's activities
should go to have their concerns heard? That could be companies
who think that you are anti-competitive or recipients of your
services who think that they are being charged too much? Where
can they go if there is not a regulator?
(Ms Lawrence) They go to HMSO at the moment.
(Mr Willey) HMSO already does regulate the ability
to license and onward sell our information. There is a strong
element of working within their regulatory framework. The other
regulatory framework which certainly does focus our minds very
much is competition law. Clearly we have to abide by competition
law both at European and at UK level. We are running a monopoly
supplier where there is no money to be made but nevertheless we
recognise that we do have a strong position on geographic information
in the market. As such we have to be mindful of competition regulation
which means you cannot overprice or underprice. You have to get
the pricing about right. You cannot just ride roughshod over anything
you want to do. You have to stay within that broad framework of
competition legislation which concentrates our minds very much.
Chairman
71. The litigation with the AA did take up quite
a lot of money, did it not?
(Mr Willey) Certainly the AA case was a big case for
us. It was a case where we believed that the AA, since the early
1990s and even before, despite their best endeavours to set out
to produce their own database, had nevertheless been using our
material. We took out legal action in 1996. It was no light decision;
it was a very decision that we took and it was going right through
to conclusion in March last year, and it was fortunate that we
were able to resolve that out of court before it went to court.
The size of the settlement was a fair reflection on ten years
of them using Crown Copyright material in their information.
72. Would it not have been better to have had
a regulator to deal with that?
(Ms Lawrence) From my point of view, having joined
the business only a few months before, David and I worked with
Centrica to sort out this historical issue. I think it actually
came down to a pure commercial issue rather than one of regulation.
The biggest benefit for everybody was the fact that certainly
by this settlement and the amount that was paid it was then fair
for all the other licensees of this information who had been in
the same market, of which there were some direct competitors to
the AA in that market who were full licensees of ours for that
time period.
73. How far do the Government or some Government
Departments ignore you?
(Ms Lawrence) I very much hope that nobody ignores
us, but we are extremely keen for more of central government to
use our data. We believe that much of central government, certainly
until say 12 months ago, had not a full understanding of the benefits
of using geographic information. At board level and at senior
manager level we have been working with many organisations across
central government to get them to understand how they could use
geographic information to better undertake their work. There are
currently 40 central government organisations who are licensees
of our information, some covered by central government service
level agreement, some by individual contracts. We are very keen,
and we also have the support of other government organisations,
to try and implement a pan-Government service level agreement
so that any of the organisations listed (and apparently we are
looking at the list within the Civil Service handbook) would be
able to use our information for internal business use. We believe
that the spread of geographic information across government will
lead to greater joining up of government. Currently this is under
discussion and we have had some very helpful discussions with
DTLR and the Office of the E-envoy, regarding making sure that
it gets centrally funded because what we are planning is to make
sure that along with the data we would also supply some experts
who would be happy to go and help new organisations who perhaps
do not have GI experts within their organisation to understand
the benefits and of course will also stimulate the private sector
to be able to work with them. We only supply data; we do not provide
software and hardware.
Chairman: Is this an argument with the Treasury
that they should give you a bit more money, or is it an argument
with the Department of Transport, Local Government and the Regions?
Mrs Dunwoody
74. Or, even better, is it with the Cabinet
Office?
(Ms Lawrence) I would suggest it is not an argument
with anyone.
75. So you are losing?
(Ms Lawrence) No, I hope I am not losing. What we
are doing at the moment is about finding out who can help centrally
fund it. There are many of those 40 organisations who obviously
currently have set aside within their own budgets for Ordnance
Survey mapping but it is about making sure that everybody will
have access to that mapping. I am not quite sure which government
department we are looking for to fund this.
Chairman
76. How much money are you short of?
(Ms Lawrence) Over a three year period we believe,
because obviously as adoption goes up there will be greater usage,
that the figure we are looking at would be £27 million. That
would be the figure in year three but in year one it would be
about £18 million.
77. So what are these departments paying individually
now?
(Mr Willey) Across the 40 departments in the last
financial year it was not far short of £18 million for all
products and services for modern surveying.
78. So it is £18 million and then you are
talking about these figures on top of the £18 million?
(Ms Lawrence) No, no, instead of the £18 million.
It would move up to £27 million in year three. We could certainly
send you a note.
Mrs Dunwoody
79. But it would be a much wider circulation?
(Ms Lawrence) Yes.
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