Conclusions and recommendations
1. Take-up of digital television has exceeded
the Departments' expectations and, so far, the switchover timetable
is on track. The programme
has benefited from strong working relationships between Government
and those in the broadcasting industry responsible for its implementation.
However, the programme still has four more years left to run.
There are still 3.75 million households which do not have digital
television and 26 million unconverted analogue television sets.
These sets will not be able to display broadcast television after
switchover if they have not been converted to receive digital
signals.
2. The Government's decision to use licence
fee money to pay for the digital switchover removed over £800
million from Parliament's regular processes governing the allocation
and use of public money. The effect has
been to weaken public accountability as the Comptroller and Auditor
General can only report on the BBC's use of the sums ring-fenced
in the licence fee settlement at the invitation of the BBC Trust.
3. In passing responsibility for procuring
and delivering the help scheme and information campaign to the
BBC, the Departments did not take adequate safeguards to secure
value for money. Using the licence fee
and partnerships with the BBC and industry to deliver switchover
makes sense, given the Departments' limited delivery capacity
and experience. However, in doing so they did not:
- specify the outcomes they required;
- ensure that the targets set by the BBC and Digital
UK were aligned with those outcomes; or
- build in adequate customer protection to prevent
the potential mis-selling of analogue televisions in the run up
to switchover.
Passing responsibility to delivery partners without
adequate accountability or clarity of purpose puts value for money
at risk. The Departments should clarify the outcomes they require
to deliver their policy objectives and should seek assurances
from the BBC that public money for the help scheme and information
campaign will only be spent to deliver these outcomes.
4. Take up of the help scheme in Copeland,
the first area to switch to digital, suggests that demand for
the scheme will be much lower than the Departments' forecasts,
which look increasingly out of date.
The Departments should review whether the scheme is reaching enough
people and achieving its objectives, based on what happens in
the Border region, which will be the first full region to switch.
In the light of this review, they should amend the design of the
scheme and the funds available as necessary before proceeding
with switchover in the Granada region from October 2009.
5. The only evidence of help scheme take-up
available to the Departments is from Copeland in Cumbria. If this
level of take-up is repeated elsewhere, there would be a surplus
of £250 million in licence fee funds ring-fenced for the
help scheme. The Departments have not
identified what they will do in the event of a substantial funding
surplus, or in the less likely event of a deficit. To promote
effective accountability and stewardship of public funds, they
should decide, before the implementation of switchover in Granada,
how any surplus will be spent or deficit funded.
6. The Departments have not defined success
measures for the help scheme. The BBC
subsidiary company, DSHS Limited, set up to administer the help
scheme, is incentivised to maximise customer satisfaction, but
that measure alone will not provide assurance of value for money.
The scheme needs to strike the right balance between supporting
vulnerable consumers and spending public money only where it is
needed. The Departments should clarify the outcomes they wish
to achieve from the scheme and should seek assurance from the
BBC that it is taking action to deliver these outcomes.
7. The Departments' reliance on voluntary
labelling and the work of Digital UK to protect consumers from
potential miss-selling of analogue televisions in the run-up to
switchover has, so far, not worked. The
'Digital Tick' was introduced nearly four years ago, but only
half the staff in the two thirds of stores which use the Digital
Tick logo understand what it means. Given reliance on the logo
to protect consumers, the Departments should set out how, by the
end of 2008, they will try to secure take-up of the logo by at
least 90% of retailers (by sales), and at least 90% understanding
of the Digital Tick among staff selling television equipment in
retail stores. This should substantially reduce the risk that
consumers will unwittingly purchase televisions with built-in
obsolescence.
8. The help scheme provides assistance to
eligible people who wish to convert their second sets to digital,
even though the Departments have not identified second set conversion
as one of their objectives. For some older
people and some people with disabilities it is important to be
able to watch television in more than one room of the house, and
Digital UK has set targets for the rates of second set conversion
it is seeking to achieve. The Departments should estimate the
likely costs and benefits of helping eligible people to convert
their second sets. They should then clarify the scheme's objectives
and priorities in respect of primary and secondary set conversion,
and should work with the BBC and Digital UK to deliver the desired
outcomes.
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