THE COMMUNITIES AND LOCAL GOVERNMENT COMMITTEE FOLLOW-UP INTO THE ORDNANCE SURVEY

 

MEMORANDUM BY THE DEPARTMENT FOR COMMUNITIES AND LOCAL GOVERNMENT

 

 

ORDNANCE SURVEY: PUBLIC SERVICE INFORMATION

 

 

INTRODUCTION

 

I.1 This paper sets out the Department for Communities and Local Government's response to follow-up questions from the Communities and Local Government Committee on the Ordnance Survey.

 

I.2 Ordnance Survey is the national mapping agency for Great Britain. It is a Government Department in its own right with Executive Agency status. It gained Trading Fund status in 1999. Its Ministers are the Department's Ministers. The Secretary of State for Communities delegates responsibility for Ordnance Survey to its 'shareholder' Minister, Angela Smith. Baroness Andrews is responsible for the Department's customer relationship with Ordnance Survey. A protocol is in place to ensure separation at both Ministerial and official level in the Department to avoid any conflicts of interest or perceptions of conflicts arising in respect of the Department's relationships with Ordnance Survey.

 

I.3 The Department's 'shareholder' interest in Ordnance Survey is supported by the Shareholder Executive. The Executive is an expert unit based at the Department of Trade and Industry but reporting to the Cabinet Secretary, with a mission to improve fundamentally the government's performance as a shareholder and to provide a source of corporate finance expertise within government.

 

 

Q1 In 2002, the Committee's predecessor, the Transport, Local Government and the Regions Committee, concluded its report on Ordnance Survey: "there is a clear need to define the boundaries of Ordnance Survey public service and national interest work." To what extent has the position changed in the intervening five years?

 

(a) In evidence to the Select Committee's recent enquiry into DCLG's Annual Report, the Department said the ending of NIMSA meant there was "no distinction between public service and commercial activity for Ordnance Survey" (Third report of 2006-07, HC 106; Ev. 105). But OS remains the largest public sector information holder in the UK, providing publicly gathered data under licence to organisations both public and private. How clear are the boundaries between its roles as the holder of base geographical information required by its partners and competitors to make their products commercially viable and as a commercial operator within the same marketplace as those partners and competitors?

 

1.1 Ordnance Survey's public task is set out in Section 1 of the Framework Document published in 2004, which makes it clear that Ordnance Survey is charged with collecting, maintaining and disseminating geographical information. It is important to note that all of Ordnance Survey's operations contribute to commercial revenue generation in some way.

 

1.2 In the light of recent events such as the publication of the Office of Fair Trading's (OFT) study on the commercial use of public information (CUPI) and the ending of NIMSA payments to Ordnance Survey, it was agreed that the definition of the public task should be revised to further clarify its boundaries. This work is ongoing, and we will send the Committee the public task document once it has been finalised and approved by Ministers.

 

 

Q2 In 2002, the Select Committee also identified "a clear need for some form of independent arbitration so that conflicts could be resolved" between OS and its customers. To what extent has that position changed in the intervening five years?

 

2.1 Since 2002, Ordnance Survey was accredited under the Information Fair Trader Scheme (IFTS) operated by the Office of Public Sector Information (OPSI). This ensures that Ordnance Survey operates in an open, transparent and fair way in respect of its trading activities. Anyone dissatisfied with the way Ordnance Survey responds to requests for access to information and data may complain to OPSI. In recent years, OPSI has investigated two complaints against Ordnance Survey and reported accordingly. OPSI found in favour of Ordnance Survey in one case and against on part of the complaint in a second. In the second case, a request by both sides for a review to the Advisory Panel for Public Information (APPSI) found that the case was not covered by the PSI regulations.

 

 

Geographic Panel

 

Q3 What is your assessment of the UK Geographic Panel's operation since its introduction in 2005?

 

3.1 The Panel has provided a useful focus for the strategic development of Geographic Information in the United Kingdom. It has a high calibre senior representation from producers and users of geographic information across the public and private sectors. The Panel communicates openly with interest groups and regularly publishes information on its website.

 

3.2 The Panel's main task has been to drive the development of a Location Strategy for the United Kingdom. Good progress has been made and key stakeholders were involved through a series of events. The Panel is now considering the way forward to maximise synergies with the European INSPIRE directive, which aims to improve access to geographical information. The Panel intends to make recommendations to the Minister, Angela Smith, during 2007.

 

 

Q4 The Select Committee's predecessor, in recommending in 2002 that an advisory panel on geographic information should be created, suggested that it should have at least three members, including the Association for Geographical Information, OS and a private sector representative. Is the current panel's membership sufficiently balanced with three private sector representatives among its 12 members?

 

4.1 The Department considers that the Panel's membership is sufficiently balanced. The composition was considered carefully in the light of the Select Committee's recommendations - the larger membership reflects the need to adequately reflect the diverse nature of the British geographic information industry. The Panel reviews its representation to ensure that it has experience of the current key issues.

 

4.2 Panel members represent a broad view of the geographic information industry. The Department considers that four of the thirteen members have a specific remit to represent the private sector. These are Association for Geographic Information, Association of British Insurers, Royal Institution of Chartered Surveyors and the Demographic User Group. We estimate that between them they represent over 700 private sector companies.

 

 

Q5 In the memorandum to the Committee during its recent inquiry into DCLG's Annual Report 2006, The Government said that the ending of NIMSA means "there is no distinction for OS between public service and commercial activities". If that is the case, should the head of a commercially active organisation continue, ex officio, to be official advisor to Ministers on "all aspects of survey, mapping and geographic information"?

 

5.1 Ordnance Survey is the national mapping agency for Great Britain. As such, its Director-General and Chief Executive has long been official advisor to Ministers, and the Department considers this to be entirely appropriate. Advice requested and provided is focused on survey, mapping and geographic information (GI), and primarily advice on short-term issues. However, Government may at any time request advice on particular issues from other interested parties.

 

5.2 The response that with the ending of the National Interest Mapping Services Agreement (NIMSA) there is no distinction between public service and commercial activity for Ordnance Survey, was to make the point that Ordnance Survey's activities are now directed towards providing data and services to public and private sector organisations and individuals under licence. The public sector makes extensive use of Ordnance Survey data.

 

 

National Interest Mapping Services Agreement (NIMSA)

 

Q6 What impact will the ending of NIMSA have on OS' own structures, financing, turnover and dividend?

 

6.1 NIMSA, established as a seven-year agreement in 1999 when Ordnance Survey became a Trading Fund, has contributed to the costs of an agreed list of mapping activities required in the national interest, which would not otherwise have been provided if the decision were made on a purely commercial basis.

 

6.2 A large proportion of NIMSA funded a single major programme - Positional Accuracy Improvement (PAI) - that resulted in an improved standard of absolute accuracy of mapping data for rural areas. This programme was successfully completed in 2006, coincident with the end of NIMSA. Much of the remainder of NIMSA supported a cyclical programme of data maintenance and capture for rural areas.

 

6.3 The annual value of NIMSA reduced over the period of the agreement. In 2006-07 it amounted to 0.96m, less than 1% of Ordnance Survey's annual turnover. The impact of the ending of NIMSA has been factored into Ordnance Survey's Corporate Plan. In accordance with Treasury guidelines, and as specified in the Ordnance Survey Framework Document, the Plan is not published.

 

6.4 With the ending of NIMSA, Ordnance Survey has reviewed its planned activity, particularly on cyclical data revision. This review has also considered opportunities presented by advances in technology, changes in approach and methodologies, and the relative priorities of different geographies.

 

6.5 Ordnance Survey now believes that it will be able to continue to provide a comparable level of support to mapping rural geography as achieved under NIMSA by adopting a new approach as outlined below (see answer to Q7). It estimates that this will lead to additional annual costs for Ordnance Survey of up to 1million.

 

 

Q7 What impact will the ending of NIMSA have on rural mapping?

 

7.1 Ordnance Survey has reviewed its rural revision policy in the light of the altered funding arrangements, evolving customer needs, and opportunities presented by new processes and technology which have improved Ordnance Survey's capability and efficiency in maintaining its databases. A new approach is close to being finalised which it believes will maintain the currency and content of the rural geography within Ordnance Survey's products, at some additional cost but not one that is disproportionate to the benefit that will be gained by the nation.

 

7.2 Under the new policy all primary features, such as residential, industrial or transport infrastructure developments, will continue to be surveyed within six months of completion. A varying two to ten-year national programme of cyclic rural revision will maintain all secondary features. All areas of Great Britain will be revised in a more integrated programme. The most populated or most rapidly changing areas will be revised more frequently than previously, with the most remote areas still being revised at least once every ten years. Revision intervals may vary according to patterns of known change and customer need.

 

7.3 As noted above (see answer to Q6) the major Positional Accuracy Improvement Programme was complete when NIMSA ended.

 

 

Q8 Will the procurement of necessary services be more expensive for local authorities now that OS is not providing them under NIMSA?

 

8.1 The cost of Ordnance Survey products was not directly affected by the existence of the NIMSA. NIMSA funding enabled investment in maintaining the consistency of currency, content and specification of the mapping to agreed levels, which would not otherwise have been provided if the decision was made on a purely commercial basis. All users benefited from these investments in the products.

 

8.2 Ordnance Survey assumes that, as in the case of the current Mapping Services Agreement (MSA), local government will invite bids for the provision of mapping information and services under a competitive tender. It is reasonable to assume that Ordnance Survey would be a bidder in such a tender process in the normal course of events. The current MSA does not expire until 31 March 2009. Until an Invitation to Tender is issued, with specifications for data and services, it would be premature (and potentially anti-competitive) to comment on likely pricing implications for Ordnance Survey.

 

 

Competition

 

Q9 Some OS competitors allege it is able to use its position as public sector information holder to compete unfairly, either by imposing over-stringent and costly licence conditions or by developing products of its own in direct competition with theirs but without the associated information licensing costs. There are further complaints that OS is an effective monopoly, preventing fair and transparent competition in the geographical information market. What is your view of these suggestions?

 

9.1 Collecting, maintaining and disseminating the data that goes into Ordnance Survey's databases is a costly undertaking. Ordnance Survey was granted Trading Fund status in order that the cost of doing so was placed upon users of the data rather than on taxpayers. The OFT CUPI study highlighted ways in which public sector information holders generally could provide easier and earlier access to data to re-users of such data in order to benefit the UK economy. Ordnance Survey and the Department have taken the CUPI study recommendations very seriously, and Ordnance Survey continues to engage with OFT to develop an acceptable solution to the concerns raised, including working to resolve some differences about the factual basis of some specific findings. It was agreed that the definition of Ordnance Survey's public task should be revised to further clarify its boundaries (see answer to Q1). Ordnance Survey is of course also subject to competition law in the same way as any other business trading within the UK.

 

9.2 Ordnance Survey actively encourages the use of its data by third parties - "Licensed Partners" - to produce products or services that it does not produce itself. It has created a series of "Specific Use Contracts" that set out the terms and conditions on which it would licence the use of its data for different types of end use. Amongst other benefits, this enables data to be priced according to the market perception of value for each end use. The Department and Ordnance Survey believe that these should be as straightforward as possible, and Ordnance Survey is currently considering how best to reduce their complexity.