House of Commons - Transport

Select Committee on Transport Ninth Report

3 Driver and Vehicle Operator (DVO) Group

15. Mr Stephen Hickey, Director General of the Driver and Vehicle Operator Group, and the four constituent Agencies' Chief Executives, told us that they believe the Group structure to be beneficial.[19] The purpose of the Group structure and the benefits it is designed to provide - better efficiency, co-operation, sharing of best practices etc. - are not in question.[20] The Committee has found only limited practical examples of these 'benefits' however.

16. We had evidence which questioned whether the Group structure delivered any benefits at all.[21] Mr Stephen Hickey was unable to provide any actual examples of benefits derived from the structure.[22]

17. The Committee is concerned that Mr Hickey was unable to provide, when challenged, concrete examples of how the Driver and Vehicle Operator Group structure has improved the working of the Agencies or the service they deliver to customers. The credibility of the new administration arrangements will depend on producing such evidence quickly.

18. This absence of firm achievements has lead to questions about the Group structure. For example, the Trade Unions made the case to us for eliminating the Group structure entirely and making the individual Agencies divisions of the Department to create a clearer command structure and streamline work processes.[23] In contrast, the Conservative Party's 2005 James Review took the opposite view: that the Agencies should be 'hived off' to save money and provide a better service. The Review argued that this would save £100 million per annum.[24]

19. It is too early for the Government to consider transferring the Group to direct Departmental control or for outright outsourcing, as some have argued. But the time to take stock is approaching rapidly. It is clear that the case made thus far for the Group's existence is more one of hope than reality. In line with the Department's commitment to evidence-based policy, we expect there to be a thorough review of the Group structure before its fifth birthday in 2008. There must be clear evidence then that the new structure has delivered real, practical benefits in terms of integrated working, value for money and service standards. In the absence of such evidence, the Department will have failed and it must then look seriously at creating a more effective structure of accountability for the Group Agencies.

DVO Board

20. The DVO Board's primary role is to support the Director General, Mr Hickey.[25] It does this in several ways, set out in the DVO Group Governance Handbook:

Setting the Group Corporate Governance arrangements;
Setting Group-wide strategies;
Setting Group-wide enabling frameworks;
Setting and monitoring performance against annual corporate planning objectives and targets;
Approving and monitoring delivery of high risk strategic projects;
Approving the annual budget;
Ensuring the appropriate internal control and risk management arrangements are in place;
Monitoring the impact of emerging issues or significant divergences.[26]

21. The DVO Board creates an additional layer of management within the Group structure. This increases costs. If the Board is to prove its worth it should be demonstrating its value in cross-Agency areas such as the setting of co-ordinated, rigorous targets;[27] ensuring timely information technology project implementation;[28] and disseminating best-practice.

22. The DVO Board must prove its worth by enhancing the overall corporate and financial governance of the Agencies. It must create identifiable benefits, and a strategic approach to services, that the separate bodies cannot achieve in isolation. We have seen no evidence yet that the Board has added value in this way. It needs to begin to demonstrate this now.

Value for money

23. The Department explained the benefits of the Group structure to the Committee in qualitative terms but did not provide any evidence that the group actually offered value for money.[29] Mr Hickey admitted that he would not 'want to claim that we provide a direct financial benefit'.[30] The Director General of the Driver and Vehicle Operator Group does not know whether or not the Group structure provides a 'direct financial benefit'. He certainly should be in a position to know, and we are astonished that he does not. It is critical that a value for money assessment of the Driver and Vehicle Operator Group be conducted as soon as is practicable to ensure that benefits are being realised in the most efficient way. We want to see the results of this in the Government's response to this report. Without such an assessment it is difficult for the Department to justify the Group structure.

Trading funds

24. Three members of the Driver and Vehicle Operator Group - the Driver and Vehicle Licensing Agency, the Driving Standards Agency and the Vehicle and Operator Services Agency - are now Trading Funds.[31] Trading Funds generate their income primarily from fees and charges and have extra freedoms and financial flexibility as a result of their status.[32] Trading Funds also have a duty to at least break even year-on-year. We received evidence questioning whether this need to cover costs might compromise the levels of service offered to customers.[33]

25. Given the functions of the Driver and Vehicle Licensing Agency, the Driving Standards Agency and the Vehicle and Operator Services Agency, Trading Fund status is appropriate. It is very important however that the financial requirements of this status should not compromise service standards. Such compromise undermines the rationale of these Agencies. It is difficult to gauge if this is happening when targets are changed frequently, are not co-ordinated across Agencies, and often do not reflect service levels at the front-end. It is vital that the impact on service levels of the shift to Trading Fund status can be measured effectively over the long term.

Position of the Vehicle Certification Agency

26. The Vehicle Certification Agency provides type approval testing and certification for vehicles, their systems and components. The Department admits that the work of the Vehicle Certification Agency 'does not overlap with the work of other Agencies.[34] The Chief Executive, Mr Markwick, insisted that the Agency is 'comfortable being a member of DVO' and that it 'deliver[s] good value to DVO and get[s] good value from DVO for us'.[35] Mr Hickey said that 'the alternative of having them entirely separate would be a loss'.[36]

27. It is not clear to us what justification there is for the Vehicle Certification Agency's inclusion in the Driver and Vehicle Operator Group. The justification offered by the Chief Executive for its inclusion in the Group was cursory. We would like the Group to offer a more detailed rationale for its inclusion when the Government responds to this report.

28. The Agency is heavily reliant on a small customer base and lower than expected business in recent years has lead to the Agency running a deficit. The Agency plans to make a surplus in 2006/07, based on an expected income increase to be delivered by business growth in China and India.[37] The Agency's plans for growth in the short term are ambitious and depend on meeting vigorous growth targets. The Committee will be questioning the Secretary of State on the Agency's progress when we look at the 2006 Departmental Annual Report.

29. We were surprised that the Agency, despite being run on a fully commercial basis, is still an Executive Agency rather than a Trading Fund. The Department told us that it had considered this option but that: 'HM Treasury advises against small Trading Funds that might lack the range or scale of income necessary to insulate against an unexpected drop in demand for one product or service'.[38] The Agency is a small organisation and is currently in deficit due to a drop in demand from some major customers. The decision not to move to Trading Fund status therefore seems reasonable. Should the Agency expand its business in the future however, its status should be reconsidered.

Administration and staffing

Changes in working practices and staff morale

30. In the Committee's report on the Department for Transport's 2005 Annual Report,[39] we emphasised our concern that the Department should minimise staff concerns about changes to working practices in its Agencies arising from the Shared Services agenda and the introduction of 'self-serving'.[40] We asked for the measures taken to ameliorate staff concerns to be itemised in the Government's reply to the report.[41] We take this opportunity to repeat that it is vital that the Department recognises the legitimate and enduring concerns of staff groups about the continuing inconsistencies in working conditions and challenges of new ways of working and has a programme in place to ameliorate them.

31. The Trade Unions have criticised the Driver and Vehicle Operator Group for having separate terms and conditions, line management chains, internal objectives, information technology systems and pay arrangements in each of its constituent Agencies.[42] Mr Hickey told us that this was 'deliberate' and that 'At the moment our judgment is that that is okay. It is not a serious obstacle to delivering what we have to deliver'.[43]

32. The Committee asked the Department for supplementary information on one particular aspect of this: the lack of shared information technology across the Group.[44] The Department told us that this is 'a legacy issue' but that, with the Department due to renew its office systems, the Group would be 'pushing for commonality with one of our Agencies, and ideally a common provision of the service. As each Agency's office systems come up for refresh they will be required to move to the standard adopted by the Department'.[45]

33. The Committee is pleased that the Driver and Vehicle Operator Group has accepted that all of its Agencies should be on a single 'information technology platform', and that office systems should be common across the whole Department and its Agencies. But it has taken far too long to arrive at this common sense conclusion. This issue must not be 'parked'. The replacement and integration of systems should be completed without delay. The Department must tell us what its timetable is for this work.

Role segregation

34. There are doubts amongst users and customers that a real separation exists within Agencies between enforcement and administration roles.[46] It is presently the case that the same companies or individuals can be customers to one part of an Agency and potential offenders to another part. One example mentioned to the Committee is that of the Driver and Vehicle Licensing Agency administering the transfer, retention and sale of registration marks and at the same time selling registration marks. The Retail Motor Industry Federation told us that:

When questioned about this particular matter, the Department insisted that 'there is no conflict whatsoever'.[48]

35. Mr Hickey told us that the Group's Agencies 'clearly have to do both' enforcement and administration. He did admit that the focus was on enforcement 'because we are at the end of the day heavily into enforcement. That is ultimately why we exist. We are there to regulate certain things and to make sure that certain things happen'.[49]

36. The Committee has not seen any clear evidence that either administration or enforcement divisions are compromised by being operated by the same Agency. We would advise Agencies to keep a sharp eye on this matter however. Customer confidence must not be compromised by the Agencies' failure to keep a proper check on their dual roles.

Injuries to Driving Standards Agency staff

37. During the 2005 calendar year, the Driving Standards Agency told us that it recorded 858 accidents involving Agency staff during driving tests; 90 non-test accidents; 386 near-misses on tests; 33 physical assaults; and 348 verbal assaults.[50] When long term absences due to accidents on the job are factored out of the absence rate, the average absence per full time equivalent (FTE) employee falls from 13.1 to 11.79.[51]

38. The Committee was reassured by the evident concern of Miss Thew, the Agency's Chief Executive, about this high injury rate and her commitment to tackle this problem quickly.[52]

39. In 2005 there were 858 accidents during driving tests; 90 non-test accidents; 386 near-misses on tests; 33 physical assaults; and 348 verbal assaults. This high number of accidents and assaults suffered by driving examiners is alarming. The Driving Standards Agency must address this as a matter of urgency. We wish to be updated by the Agency on its progress in one year's time.

Efficiency

40. Efficiency is a Department-wide concern. The Department's Efficiency Technical Note contains efficiency programmes related to all Driver and Vehicle Operator Group bodies.[53] It is important however that the efficiency programme does not simply become a collection of disjointed projects owned by the individual Agencies without lessons being shared across the whole Group.

41. There is some evidence of attempts by the Driver and Vehicle Operator Group to make savings where possible. Further scope for savings are sure to follow where all bodies within the Group regularly benchmark costs against each other. We seek the Department's reassurance that such benchmarking is taking place as a matter of course.

42. The Committee is concerned that efficiency savings should be robust. For example, the Department told us that over the six years to the end of the 2004/05 financial year the Driver and Vehicle Licensing Agency delivered efficiency gains of 21.5%.[54] In evidence, Mr Bennett, the Chief Executive of the Agency, told us that he anticipates a further 20 per cent cut to 2008/09.[55] This is a very significant saving. It implies that there was a great deal of 'pork' in the Agency 'barrel' in 1998/99 when these savings were initiated, and that there remains plenty yet to be done.

43. The Committee is encouraged by the 20 per cent efficiency savings made by the Driver and Vehicle Licensing Agency in 2004/05 and further 20 per cent planned savings. We expect to see the other Driver and Vehicle Operator Group Agencies set similarly ambitious efficiency targets.

44. The Group also has a commitment to meeting the Government's 2008 efficiency targets. These are: an increase in Vehicle Excise Duty (VED) revenue by £70 million; efficiency and effectiveness improvements of £75 million; and a headcount reduction of 500, to come specifically from the Driver and Vehicle Licensing Agency.[56] The Driver and Vehicle Licensing Agency appears to be on the way to meeting its Gershon Review headcount reduction target on time. The Agency is aware that this must not compromise service standards. It remains to be seen whether this will be the case. We shall keep a close eye on any evidence of slipping standards.

Corporate documents

45. It is clear to us that savings could be made on published corporate documents. The table below shows the amounts that the Driver and Vehicle Operator Group, other than Vehicle Certification Agency,[57] spent on publishing corporate documents in 2004/05.[58] The costs for Vehicle and Operator Services Agency (VOSA) are significantly higher than those of the other Agencies, and we had no evidence of a justification for this. We are pleased to note that the Driver and Vehicle Licensing Agency will be significantly reducing its costs by bringing production of these documents in-house; resulting in a saving of over 40 per cent. VOSA needs to follow suit.

	Corporate/ Business Plan	Annual Report (& Accounts)	Total
DVO Central	£4,000	£5,760	£9,760
DSA	£5,020	£4,950	£9,570
DVLA¹	£5,475	£11,380	£16,855
VOSA	£18,304	£16,208	£34,512
¹ From 2005/06 documents will be produced in-house at a total cost of £9,420

The Vehicle and Operator Services Agency's costs for producing corporate documents are too high. They must be reduced.

Prepayment to the Post office

46. Under the terms of its contract with the Post Office,[59] the Driver and Vehicle Licensing Agency makes advance payments twice a year. The prepayment for the period from 1 April 2005 to 30 September 2005 was £23 million.[60] It is generally accepted best practice in Government that services should not be paid for in advance unless there is a sound value for money argument in favour of doing so. We were not given any such justification in this case. The Driver and Vehicle Licensing Agency should have conducted a value for money assessment for the prepayments it makes to the Post Office. If it has not done so, it must do so now, and must also provide a copy of this assessment to the Committee. If no such assessment has been made, the Department needs to explain why in its response to this report.

Targets and performance

Consistency and toughness of targets

47. We had difficulty understanding some of the targets provided by the Driver and Vehicle Operator Group.

48. Many of the targets set for individual Agencies are insufficiently challenging:[61]

The Driving Standards Agency has had a driver candidate satisfaction target since 2002/03 that has never been increased above 90%; a further target of 90% of calls to booking offices being answered by a human voice in less than 20 seconds after routing by the call handling system has actually decreased from a 91% target in 2002/03.
The Driving Standards Agency's achievement against targets for practical test waiting times rose from 7.8 weeks for car drivers in 2002/03 to 8.4 weeks in 2004/05; the target for vocational drivers rose from an average 3.2 weeks in 2002/03 to 4.1 weeks in 2004/05. There was also a dramatic fall in the number of practical car test appointments to be available in 99% of permanent driving test centres within 9 weeks - from an 89% achievement rate in 2002/03 to a paltry 63% in 2004/05.
In 2002/03 the Driving Standards Agency achieved a driving instructor practical test waiting time of 5.3 weeks; by 2004/05 this had risen to 7 weeks; in terms of answering correspondence the target for answering 97% of letters and emails within 10 working days fell from a 98% achievement rate in 2002/03 to 94% in 2004/05; and the 2002/03 target of 100% of undisputed and settled invoices to be paid within 30 days of receipt was reduced to a 98% target in 2004/05. Miss Thew admitted in evidence that 'we are falling short on the delivery and achievement of some of our ... target areas'.[62]
The Driver and Vehicle Licensing Agency has low customer service targets and its performance has fallen against them. In 2002/03 91% of calls routed out of the automated system were answered within 30 seconds against a target of 82%; by 2004/05 achievement against the same target had fallen to 82.7%; the percentage of emails answered within three working days fell from 97.3% in 2002/03 to 86.6% in 2004/05, against a target of 95%.
Customer service targets are also low at the Vehicle and Operator Services Agency; and although the Agency tends to exceed those targets, it is not by a sufficient margin to instil real confidence. The customer satisfaction target for operator licensing is 78%; the Agency achieved 83% in 2004/05; the target for operator testing was a lowly 73%, it achieved 79%. The target for MOT customers was set at 93%. This target was not achieved in 2004/05, when satisfaction was 81%.

The overall picture of efficiency in the Driver and Vehicle Operator Group is one of declining achievements. Mr Hickey and his team need to get a grip on the problem and reverse it. We expect to see a plan for achieving this set out in the Government's response.

49. We are unhappy about the validity of the Department's statistics. For example, Mr Bennett, of the Driver and Vehicle Licensing Agency, cited completely different figures for customer service and satisfaction.[63] The Driver and Vehicle Licensing Agency gave the Committee three sets of figures for its customer service targets (two in writing, one in oral evidence). This is unacceptable. The Agency must clarify its figures and publish one full set in the public domain. The Committee does not expect to see further examples of this problem.

The retreat from 'customer service'

50. We have concerns about the focus of the Driver and Vehicle Operator Group's targets. From 'outputs', i.e. 'providing effective measurement of day to day customer service standards', targets have become 'high priority objectives for the year in question, including milestones where appropriate'.[64] This is a significant and unwelcome retreat from customer-focused targets to internal, inward-looking objectives.

51. We asked Mr Hickey to explain the rationale for this change. He told us that 'in the past the targets were expressed very much in terms of simply the day-to-day service delivery, which matters of course as important, but they were not capturing some of the major change programmes that the Agencies are having to manage through'.[65] We consider this to be akin to waffle. Despite Mr Hickey's insistence that 'day-to-day service' is 'absolutely vital and number one',[66] this is simply not reflected in the change of emphasis inherent in the move away from performance targets. Arbitrary, internal targets alone are not a satisfactory way to measure performance. The present, low level targets should be internal key performance indicators (KPIs), not Business Plan targets.

52. It is clear to this Committee that the Agencies' focus on their customers has been downgraded. This is clear to customers too. In recent Group surveys, almost one third of customers were dissatisfied with the Group's Agencies. One of the main causes of dissatisfaction was poor quality of service, particularly the difficulty of finding someone over the telephone to help when problems arise.[67]

53. The Driver and Vehicle Operator Group has moved away from tough, precise public service to woolly, internal milestones. This is a retrograde step which makes measuring the Group's success much more difficult and which will sap public confidence. The Department needs to think again about this approach.

54. It is also unacceptable that there are so many different 'measures' of success for the Agencies. There must be one, clear, consistent measure of customer service standards and customer satisfaction, subscribed to by all Agencies and by the Group as a whole. The target must be sufficiently challenging and performance against it should be measured and published annually by the Department.

Under-performance

55. Under-performance by individual Agencies is dealt with on a quarterly basis, when Agencies provide an account of their performance to their Advisory Boards.[68] 'Significant' issues or concerns are escalated to the Departmental Board and Ministers.[69] The Committee requested supplementary evidence from the Department to explain how this process works. The Department told us that 'it is for the [DVO Group Director General - Mr Hickey] and the relevant Chief Executive to judge whether an issue is 'significant'. Factors would include both the inherent importance of the issue … and its public profile'.[70] The Department provided only two recent examples where this procedure was triggered: when the Driving Standards Agency encountered industrial action in early 2004, and when difficulties occurred with MOT computerisation.[71]

56. It is not clear to the Committee, despite the evidence we have received, whether the process of managing under-performance is actually effective, or just window-dressing. In particular, we have concerns that it is the Group Director General and the relevant Agency Chief Executive themselves who decide what constitutes a 'significant' matter for 'escalation' to Ministers. This is very poor administrative practice. We expect the Department to advance evidence of much more robust arrangements for identifying under-performance and for tackling it.

Information Technology

57. Cost overruns, mismanagement of projects, disruption across the Group and knock-on effects are all in evidence across a variety of information technology projects. Our predecessor Committee has warned these Agencies about this before.[72]

Level of take-up

58. We question whether the Agencies' great focus on information technology solutions is entirely appropriate. The Department told us that information technology plays a 'central' role in the Group's customer service strategy.[73] It is worth reminding ourselves that, despite great benefits, there are limits to the usefulness of information technology.

59. For example, 63 per cent of UK adults only have access to the internet.[74] It is also widely known that there are areas where internet access is very low and that there is a real danger of information technology exclusion.[75] We therefore wonder how much scope there is for higher take up for projects such as online driving test booking and tax disc renewal:

42 per cent of practical driving tests and 52 per cent of theory tests are currently booked online;[76]
the operator self-service system operated by the Vehicle and Operator Services Agency has a 57 per cent take-up rate;[77] and
52 per cent of private motorists are 'likely' to use a website with information and services for motorists; 46 per cent are likely to renew their vehicle tax disc online.[78]

60. These figures cause us to question the evident belief of the Agencies that there is considerable scope for expansion of Internet-provided services. Money might be better spent improving telephone response times and the quality of the human response for the (majority of) customers who either do not have access to or choose not to use the Internet.

61. We also wonder about the Group's motivation for introducing so many information technology solutions. The Department for Transport's Efficiency Technical Note states that:

62. We are concerned that the Driver and Vehicle Operator Group and its constituent Agencies seem to be highly focused on the cost savings available through the introduction of information technology-based solutions at the expense of customer service. The Agencies gave us no evidence that their Internet-based operations have the potential to grow beyond current levels. They were not able to demonstrate that there is any real demand for this costly expansion from customers.

63. We do recognise that in the modern world the Internet is a vital tool for speeding up and simplifying transactions. We are not arguing for a return to a system of customer service that avoids information technology solutions. We do however expect the Agencies to make a solid demand case for future information technology projects; and to recognise the vital importance of driving up the effectiveness of human responses to customers. These projects are uniformly costly and complex undertakings and should not be begun without determining what will bring the most benefit to the greatest number of people.

Automatic test booking system and MOT computerisation

64. The Vehicle and Operator Services Agency's automatic test booking system was set up initially as an internal Agency system for electronically testing and billing vehicle operators. The Agency then put the system on the Internet to allow any operator or individual to book a test online.[80] We received evidence that the Agency was alerted to problems with the new system but failed to act on such warnings, leaving some companies 'in an uncertain position regarding their accounts for almost three months'.[81]

65. When asked to address these concerns, Mr Tetlow responded that the Agency was still working on ironing out the problems with the system.[82]

66. MOT computerisation involves providing all of the Vehicle and Operator Services Agency's 18,500 MOT Testing Stations with PCs, monitors and printers. These are connected to a central database of vehicle information, test results and details of authorised examiners and testers. Access to the system is for authorised users via electronic smart cards and a password. Mr Tetlow claimed that the main benefits of computerisation are better service for the motorist and improved monitoring of the MOT system.[83] By 14 December 2005 over a third of private car testing stations (4,917 of 13,292) remained to be computerised.[84]

67. The Agency explained that technical problems with the system experienced since it went live in April 2005 have been rare and have largely affected only a small number of test centres.[85] This was contradicted however by evidence to the Committee that the system had not been working well and that the introduction of computerisation was 'beset by problems'.[86]

68. Mr Tetlow's supplementary evidence on this matter dismissed the picture of despair painted by other witnesses. He said that the problems during implementation did not constitute a 'whole systems failure' and that 'Garages and MOT customers were able to carry on delivering and receiving the MOT service and the computerised system was virtually fully restored within 4 working days'.[87] He said that press coverage had created a 'negative impression' of the implementation and that articles stating that 'millions' of garages were unable to test were 'inaccurate'.[88]

69. Both automatic test booking and MOT computerisation were affected by delays and implementation problems. It is unacceptable that initial confusion resulted in uncertainties over billing which lasted three weeks. The Vehicle and Operator Services Agency Chief Executive, Mr Tetlow, reassured the Committee that these problems were dealt with and that restoring a full customer service as soon as practicable was the priority. Information technology projects are too often beset by difficulties of this kind. It is critical that the lessons learned by the Agency from the introduction of these projects are shared by the whole Driver and Vehicle Operator Group so that there is no repetition of this qualified failure.

Protection of data on the driver register

70. Through the Driver and Vehicle Licensing Agency's databases 97.4% of vehicle keepers are able to be traced.[89] The Department told us that this data enabled the Agency 'to contribute to improving road safety, reducing vehicle crime and the efficient collection of Vehicle Excise Duty (VED) on behalf of HM Treasury'.[90] We recognise the importance of the data held on the Driver and Vehicle Licensing Agency's driver and vehicle registers. It is therefore vital that it should be safe from disclosure to unscrupulous third parties.

71. The Agency may provide the names and addresses of car drivers, but only in certain circumstances. Regulation 27 of the Road Vehicles (Registration and Licensing) Regulations 2002[91] requires the Secretary of State to provide, free of charge, information from the register to the police and to local authorities for use in connection with an offence.[92] Information must also be made available, for a fee, to 'any person who can show to the satisfaction of the Secretary of State that he has reasonable cause for wanting the particulars to be made available to him'. 'Reasonable cause' is not defined in the legislation.[93]

72. The Transport Minister announced in December 2005 that this disclosure policy would be reviewed early in 2006. This followed a media campaign which highlighted incidents of unscrupulous companies and individuals gaining access to the register under the 'reasonable cause' definition and misusing the data.[94] Mr Bennett, the Agency Chief Executive, welcomed the review and admitted that 'It is really important to examine what does "reasonable cause" mean for a given circumstance',[95] and that 'whenever "reasonable cause" comes in, there is a risk that you will get unscrupulous people trying to get a name and address'.[96] We agree.

73. The Committee welcomes the Department's review of the data release policy for the Driver and Vehicle Licensing Agency databases. It is vital that this data is not released to companies or individuals who might misuse it. Public confidence in the disclosure policy has been lost; it must be restored. We recommend that 'reasonable cause', the presently undefined standard for disclosing drivers' names and addresses to third parties, be legally defined, and we invite the Government to set out a preferred definition when it replies to this report.

Vehicle and Operator Services Agency

74. The Vehicle and Operator Services Agency performs an important function: it polices the roadworthiness of passenger and commercial vehicles on the road network. This work is being compromised by a lack of confidence in three particular areas: test centre relocation, roadside vehicle checks, and the points system for vehicle examiners.

Test centre locations

75. The Agency's test centre locations are based on a model of the road network of the 1960s, not the twenty-first century.[97] In January 2006 the industry press suggested that test centres are generally 'in congested built up areas, a long way from motorway junctions or the majority of haulage depots. Some parts of the country have too many stations, others too few'.[98] Mr Tetlow broadly agreed with this assessment.[99] The Agency is currently carrying out a survey to determine from where vehicles travel to testing stations.

76. Mr Tetlow stated that test centre locations were under review and that there would be relocations.[100] It is not clear whether this will involve an open consultation with affected workers, or indeed what the timetable is for this review. The Trade Unions have expressed concerns that as a 'value for money' review, the focus may be too much on cutting costs and not on finding the best solution for customers and operators. They are also concerned that it could lead to longer travel times to test centres, adding to emissions levels.[101]

77. The test centres of the Vehicle and Operator Services Agency are not ideally located. This is acknowledged by the Agency. It is critical that the Agency's review of test centre locations goes ahead promptly and that the locations chosen for new sites have a good fit with twenty-first century road patterns. We are alarmed by the lack of precise information about the timing and scope of the review. Nor was it clear that there will be an open consultation so that those affected have a chance to make their views known. The Vehicle and Operator Services Agency must rectify this immediately by setting out a clear timetable, the parameters of the review, and by making a commitment to consult the industry.

Roadside checks

78. Roadside vehicle checks are an important tool for identifying substandard vehicles and ensuring they do not travel on the road. It is clear that a great deal of traffic travels through United Kingdom ports on its way to and from mainland Europe and beyond. It is therefore sensible that roadside checks are focused on the main thoroughfares to and from our larger ports.

79. The Committee is concerned however that a large number of checks could unfairly affect the business of individual ports. In particular, the Port of Holyhead was brought to our attention.[102] Holyhead is only the twenty-fourth largest port in the country by tonnage traffic. It is therefore reasonable to expect that there are roadside checks of a similar or greater number around larger ports such as Grimsby & Immingham; Tees & Hartlepool; London; Milford Haven and Southampton.[103] Mr Tetlow responded that complaints by ports operators 'ring true', but that it is right to target areas where the Agency expects to catch significant numbers of offenders.[104]

80. The Agency is right to target roadside checks at areas where there are suspected high levels of offenders. We had evidence however that an individual port may have been singled out for a greater number of checks than other ports of equal or greater size. This seems inequitable. We want the Agency to explain in detail its rationale for checks, and to be assured that operations are targeted proportionately with the number of vehicles transitting them.

Points system for Vehicle Examiners

81. The Committee received evidence that the 'points system' used to measure the performance of vehicle examiners provides perverse incentives for examiners to focus on operators rather than drivers.[105] One witness told us that examiners are 'given a target to meet over a certain period, be it a fail or pass rate, and bonus payments are given regarding their performance. This can lead to all sorts of malpractice'.[106]

82. We are concerned that when asked about this particular problem, Mr Tetlow was not able to provide a defence of the system other to say that operators who were fined and complained 'would say that, wouldn't they' and that the Agency itself 'did not devise the points system'.[107] This is not acceptable.

83. Mr Tetlow made little effort to defend the points system for vehicle examiners. He also failed to convince the Committee that the complaints procedure for operators against vehicle examiners is sufficiently independent or free from implicit intimidation by examiners. One of the Agency's most important functions is ensuring that vehicles are safe when on the road. The way in which vehicle examiners are rewarded for how they perform should be open and transparent. The Agency should look again at how the vital function of vehicle inspection is linked to the system of reward for vehicle examiners. We expect the Agency to explain how it will do this when the Government replies to this report.

Younger drivers

84. Despite the recommendation of our predecessor Committee seven years ago,[108] the Government has not since taken the opportunity to improve after-test monitoring for younger drivers. This is unacceptable.

85. While the overall number of deaths on British roads fell by eight per cent in 2004, fatalities among 16 to 19 year old drivers or passengers rose by 12 per cent over the same period.[109] Our predecessor Committee's 1999 report quoted stark figures for the number of accidents involving younger drivers:

The 17-24 age group holds only 11 per cent of licences, but they are involved in a quarter of accidents annually in which someone is killed or seriously injured;
Drivers aged between 16 and 19 have 16 accidents per thousand licence holders, compared to just six per thousand licences for drivers aged over 25 years;
Male drivers aged between 17 and 20 are ten times more likely to die in a collision than for men aged between 35 and 54;
Very newly qualified drivers are at particularly high risk, with one in five new drivers involved in a collision in their first year of driving.[110]

86. Since then very little has changed and the Government has declined to act. The Parliamentary Advisory Council on Transport Safety (PACTS) helped draft an amendment to the Road Safety Bill, currently before the House, requiring a strengthening of the current probationary period for newly qualified drivers, who are also, by and large, younger drivers.[111] In responding to this New Clause, the Road Safety Minister, Dr Stephen Ladyman, insisted that:

112

Miss Thew, Chief Executive of the Driving Standards Agency, emphasised the need to prepare young people before they take their test of their responsibilities once they are a car driver and to increase their road safety awareness.[113] There is little evidence yet that these programmes are having any impact, though studies are being undertaken.[114]

87. The accident rates for younger drivers are appallingly high, and rose by 12 per cent in 2004. It is important that the studies that the Driving Standards Agency is undertaking to look at the efficacy of programmes such as Arrive Alive and Pass Plus that help educate younger, newly qualified drivers are properly considered by the Department. If these studies demonstrate material benefit from such programmes, the Department must act quickly to make them mandatory for all young people preparing to learn how to drive.

88. In the meantime, the Committee does not see why a strengthening of the existing probationary period for young, newly qualified drivers should not be implemented. We do not agree that such a strengthening would be 'draconian', as described by Dr Stephen Ladyman MP, Minister of State for Transport, during the Committee stage of the Road Safety Bill. We recommend that the Government seek powers in the Bill to vary the measures for the probationary period. It should then consult fully on changes to those measures and introduce them by Statutory Instrument later this year.

19 Q2 Back

20 Ev 19 states: 'DVO Group was established [in] its current form in 2003 with the aim of promoting closer collaboration between its constituent Agencies and of bringing them closer to the Department'; The DVO Group Governance Handbook (October 2005) states that 'By forming the DVO Group, we've provided end-to-end accountability and clear leadership' Back

21 See Ev 169 Back

22 Q2 Back

23 Ev 121 Back

24 Conservative Party, The James Review of Taxpayer Value, 2005, pp147-148 Back

25 A chart showing how the DVO Board fits into the Group governance structure is available in the Annex to this report Back

26 The DVO Group Governance Handbook, October 2005, para 44 Back

27 see para 65+, below Back

28 see para 75+, below Back

29 The Group's financial objectives are summarised in the Handbook, paras 33-41 Back

30 Q118 Back