Examination of Witnesses (Questions 60-79)
DEPARTMENT FOR
CULTURE, MEDIA
AND SPORT,
DIGITAL SWITCHOVER
HELP SCHEME
& DEPARTMENT FOR
BUSINESS, ENTERPRISE
AND REGULATORY
REFORM
MONDAY 10 MARCH
2008
Q60 Mr Bacon: There must be a lot
of people who will be interested in the answer to this question,
who will be saying to you over the next three or four years, "Mr
White, do you realise that if you act in a certain way or do certain
things or do not do certain things, you could have £250 million
sitting there"; have they started coming to you yet?
Mr White: The useful thing is
that I am protected by the policy of the scheme, so my role is
to deliver the policy of the scheme. So the type of set-top box
that we implement, which could be a cost driver, is set by what
is called the core receiver requirements, which is set by Government
policy. Who I can help is set by the policy. So actually my job
is to deliver within those criteria. There are processes in place
that involve Government and others if the scheme is changed in
any way, but actually that is not for me to consider whether the
scheme is to be changed, that is more of a policy issue.
Q61 Mr Bacon: Are you on some sort
of bonus arrangement? Does your contract of employment give you
a bonus?
Mr White: It does.
Q62 Mr Bacon: How are you incentivised,
the number of people you help?
Mr White: More customer satisfaction,
so I say the premise of the scheme, from where I sit—
Q63 Mr Bacon: Not more customers,
more customer satisfaction?
Mr White: The premise of the scheme
is to make sure that we reach all of those who are eligible and
engage with as many of those as we can. I am entitled to write
to them three times, but there will be some of the eligible people
who still will not respond to that, that we will need to use the
third sector to get to, so I will be judged on that. I will also
be judged on customer satisfaction, so if people we have communicated
with, they say they want help, if we then give them help, I will
be judged on how well we have helped them, not on take-up.
Mr Bacon: I must say I still regard it
as amazing that we are spending all this public money to encourage
people to watch more television, but that is another matter, a
policy matter, not for me. I would like to ask Mr Stephens --
I was going to call you Sir Jonathan, but you are not yet. I am
sure that will be corrected in time.
Chairman: As long as you do the Olympics
properly.
Q64 Mr Bacon: I was going to say,
Chairman, regardless of whether you do the Olympics properly.
I am sure it will go very smoothly if we just wait long
enough. I would like to ask you about Winter Hill and the delays.
I think this was referred to earlier. In paragraph 2.16, it says
that Winter Hill, which is in the Granada region, and serves 3
million households, "there is no contingency and work is
currently significantly behind schedule. Action to recover this
lost time could draw resources from other sites and potentially
affect the completion of switchover in some other regions."
What are you going to do about this? Are you going to affect the
timetable elsewhere, are you going to affect the timetable there?
It goes on to say that options include the use of a reserve transmitter
at Winter Hill. Is that as powerful as the existing one?
Mr Stephens: I will pass this
over to Sir Brian, if I may.
Q65 Mr Bacon: Welcome, Sir Brian,
to your 25th hearing, I do not think anyone has mentioned that
yet.
Sir Brian Bender: That is very
kind of you.
Q66 Mr Bacon: We forgot to bring
the cake, but we will get one eventually.
Sir Brian Bender: Perhaps afterwards.
As I said in response to an earlier question, we may use a reserve
antenna. The other thing that is being done in this area is more
working hours to make up for the contingency, but at present,
those who assess the risk have concluded that it is on time. The
contingency has been used up, it has been mitigated in the way
I have described, but present consideration by those who reach
these judgments is there is no reason to change the schedule,
and that means no knock-on effect elsewhere, or in its own area.
Q67 Mr Bacon: And the level of service
will be the same?
Sir Brian Bender: I believe that
to be the case.
Q68 Mr Bacon: I would like to ask
about Ofcom. This is probably for you, Mr Stephens?
Mr Stephens: Ofcom is a joint
responsibility of the two Departments.
Q69 Mr Bacon: I am always suspicious
where there is lots of joint responsibility. I remember a hearing
on the Northern Ireland Office, one of those Northern Irish Departments
in Belfast, and the first thing the Permanent Secretary said was,
"I would like you to know, Chairman, that I am not responsible
for 98% of the spending here", which led you to question
why that particular Permanent Secretary was in front of us, but
she seemed to have more responsibility than anyone else. My question
really is about who is accountable for all this if it goes wrong?
Is it the BBC? Is it you, Mr White?
Mr Stephens: Ministers have set
the timetable, they have set the objective, which is switchover
in 2012, with no loss of service, with all those who want help
who are eligible receiving help. That in turn has been reflected
in obligations on the broadcasters for which their various regulators
are responsible. Digital UK, which has been created by the broadcasters
at the initiative of the Government, is responsible for overall
management of the programme.
Q70 Mr Bacon: It says in paragraph
2.12 that Ofcom has recourse to statutory sanctions which it can
use if licence holders do not meet their switchover obligations.
What are these statutory sanctions?
Mr Stephens: They are the full
range, including fines and ultimately action on withdrawing the
licence.
Q71 Mr Bacon: When it says licence
holders, it does not mean holders of television licences, you
are not planning to fine --
Mr Stephens: It means broadcasters.
Q72 Mr Bacon: Just to be clear about
that. I would just like to ask Mr White one other question about
the impact of reducing services for infrastructure upgrades. What
will be the impact on viewers of switching off existing services
or reducing power to allow for infrastructure upgrades?
Mr White: Again, this is not my
direct area of responsibility, but I understand that there are
limited effects to consumers as they go through. There are a few
minor ones in certain areas.
Q73 Mr Bacon: Whose area of responsibility
is it?
Mr White: The controller of distribution.
Chairman: Thank you very much. Geraldine
Smith?
Q74 Geraldine Smith: Thank you, I
think a lot of the ground that I want to cover has probably already
been covered, but sometimes I find it difficult listening to answers
from Permanent Secretaries, I do not feel sometimes that I have
had a clear answer, so maybe if I could ask one or two questions
again, just so it is clear in my mind. My own area, the switchover
will be in the Granada area October to December 2009, so retailers
can sell analogue sets right up to October 2009.
Sir Brian Bender: Well, they can,
but I repeat some of the points I was making earlier. First of
all, the market is moving so that retailers—some of them
have just stepped out of it, Currys have said recently they will
only sell digital; and secondly, the use of the digital tick symbol
for consumers is a thing they should follow, and retailers are
being further trained, but it is not banned.
Q75 Geraldine Smith: There may well
be analogue television sets left around at that time in my area,
so people will be able to buy them right up to the time, the day
before the switchover takes place, and they will be buying a TV
set that they are going to have to buy something else in order
to make it work, right up until the day before.
Sir Brian Bender: Either the Government
bans it, and as I said, in response to earlier questions, that
is a decision Ministers decided they would not take; or we need
to make sure that the retailers have the right information. In
this particular case, as you say, if they do buy an analogue set,
and that will become increasingly difficult, but if they do, then
they would need to spend another £20-£30 on a set-top
box to make it work.
Q76 Geraldine Smith: You said they
made a decision after a consultation; who did they consult with?
Sir Brian Bender: I can provide
a note, but I cannot answer that question. It was a full public
consultation some years ago.
Q77 Geraldine Smith: Full public.
You can provide the detail to me of how that consultation was
carried out?
Sir Brian Bender: Yes.[2]
Q78 Geraldine Smith: I think some of
us are left wondering why it has all been left to the BBC, the
help scheme. It does not really hit you as the sort of thing the
BBC would normally be getting involved in, helping old-age pensioners
that may be on benefits with the digital switchover, and indeed
the only thing the BBC have done is handed that out to eaga, to
another company to do, so why could not the Government do that
directly? Earlier in your answer, you said it was because the
BBC were very experienced in procurement and everything; is the
Government not? Is your Department not?
Mr Stephens: We do not deliver
services directly as a Department in any of our areas, so we do
not have the direct experience of managing directly ourselves
procurement of this sort of size and scale, so we would have had
needed to bring that expertise in at inevitably extra cost.
Q79 Geraldine Smith: Have you not
created another layer, going through the BBC?
Mr Stephens: No, we have used
an existing delivery mechanism rather than create a new one, and
actually the evidence is that the independent observer involved
in the procurement process said that the BBC conducted it in an
absolutely exemplary way, it was a model of its kind for public
sector procurement.
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