UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE
To be published as HC 1611-i

House of COMMONS

Oral EVIDENCE

TAKEN BEFORE the

Transport Committee

Work of the DVLA

Tuesday 22 November 2011

Simon Tse and David Evans

Evidence heard in Public Questions 1 - 75

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Oral Evidence

Taken before the Transport Committee

on Tuesday 22 November 2011

Members present:

Mrs Louise Ellman (Chair)

Steve Baker

Jim Dobbin

Julie Hilling

Kwasi Kwarteng

Mr John Leech

Iain Stewart

Graham Stringer

________________

Examination of Witnesses

Witnesses: Simon Tse, Chief Executive, and David Evans, Corporate Affairs Director, Driver and Vehicle Licensing Agency, gave evidence.

Q1 Chair: Good morning, gentlemen, and welcome to the Transport Select Committee. Could you identify yourselves, please, with your name and organisation for our records?

David Evans: I am David Evans from the DVLA, Swansea.

Simon Tse: Good morning, Madam Chair. I am Simon Tse. I am the Chief Executive of the DVLA.

Q2 Chair: You are seeking £100 million costs savings each year by 2014-15. How are you going to do that?

Simon Tse: It is, Madam Chair and Select Members, by a series of different activities in the organisation. The majority of it is by modernisation of our services. We are taking more of the services that we provide and putting them online as a service. Having said that, it is not just about e-enablement and digital by default. There are lots of other savings as an Agency that we can contribute.

One example is the issuing of tax discs. Historically, the Agency has issued its tax discs to members of the public under first-class postage. In the last 12 months or so we have started carrying out a review of our processes in terms of postage. We noticed that, if we send them second class, it saves the Agency somewhere in the region of £1.5 million a year just by sending them second class. Bear in mind that for those of you that are able to tax online-and 52% or 53% of the population are doing it online-you can tax your vehicle from the 5th of the month when your tax is due at the end of the month. Invariably, a lot of people do tax from the beginning of the month. They do not need the tax disc until the end of the month, so sending it out second class effectively means that we can save the Agency £1.5 million. That is just one example of the sort of savings we can generate.

Another example would be the introduction of what we call "cherished transfers" online. If we look at our cherished transfer product, which is where people can buy personalised registration marks and put them on to vehicles and transfer them, today, that is quite a labour-intensive process, not just for us but for our customers as well. They need to go to one of our local offices to carry out that sort of a transaction. We are looking to work with the industry to make that a facility they can do online rather than having to go to one of our local offices to do so.

With first registrations-i.e. where a dealership or a manufacturer registers a vehicle for the first time in the UK-99% of all vehicles are now done online. The industry is asking us to do the same sort of facility for things like cherished transfers. It is those sorts of things, Madam Chair, that we are looking to develop over the coming years that will deliver the £100 million worth of savings.

Q3 Chair: Is there any scope for selling your services to other organisations?

Simon Tse: Sorry. What do you mean when you say "selling" them to other organisations?

Q4 Chair: Is there any scope for doing that for other people and other organisations buying your services?

Simon Tse: There are ways we are looking at. Whether or not it is selling those services remains to be seen. I know my Minister has given evidence to the Committee, for example, on the insurance industry being able to access our drivers’ database so that, at the point of giving a quotation or taking out an insurance policy, the insurance industry is able to see the driver’s record, how many penalty points, etc., are on that licence and when they were issued, rather than it being down to the individual relaying that information to the insurance bodies themselves. We are working with the insurance industry right now on developing that sort of a facility. It is yet to be determined in terms of the exact costs of that sort of service and when it will be delivered, but we are working with the industry on that.

Q5 Chair: You have outsourced a lot of your spend on a major IT contract. Are you getting good value for money from that?

Simon Tse: Yes. If I look at the amount that the Agency spends in any one year, we spend just over £515 million a year. £160 million of that is on salaries. £356 million of it is on services. That is everything from Royal Mail to the Post Office services that are provided for us throughout the UK, or our IT supplier. We spend £140 million a year with our IT supplier and we have had some great successes through that relationship. EVL, which is the ability to tax online, is just one example in Government and it is led as being one of those predominant services across the UK that is being provided in an excellent fashion. We have had those sorts of successes with our IT supplier.

Are we seeing value for money for that? Yes. Are we driving more efficiencies from our IT supplier? Yes, we are. In the last two years alone-and the contract finishes in 2015-we have delivered £180 million worth of savings to the end of the contract life. I believe we are getting efficiencies and value for money from that contract.

Q6 Graham Stringer: Going back to insurance, what are the main impediments to speeding up the access to insurance companies to your database?

Simon Tse: Mr Stringer, the major implication in there is authentication. I need to make certain that the person or organisation inquiring on our systems has the right to do so. If I go back a few years, we provided, under a pilot, driver licence checking services online and we particularly offered that as a pilot to a number of hire companies across the UK. It is all to do with authentication and me knowing that the person at the end of that connection has the legal gateway to come through and look at those details. It is that level of complexity that meant that, in the pilot that we ran with the hire companies in 2008-09, we had to withdraw the service because we saw the amount of effort that was involved in developing that sort of a system. That being said, we do want to revisit driver licence checking online for the industry. We will also build that as a strategic platform for the insurance industry so that we can ensure that we have authentication there.

Q7 Graham Stringer: You do provide information for parking companies when they are chasing fines, don’t you? How do you authenticate those companies?

Simon Tse: Effectively, it is done on a contract that we have with the parking organisations across the UK. We have a code of practice with the British Parking Association. It is a specific link that we have between those two organisations. I do not know if Mr Evans wants to add to that.

David Evans: It is about release of driver information to the insurance industry which is personal information. For the parking companies what we are releasing is information about who is the vehicle keeper. There is a different legal gateway. The legal gateway used to provide information-

Q8 Graham Stringer: It is still personal information, isn’t it?

David Evans: Not who keeps a vehicle, no; not who is liable for it. That is the first point of contact.

Q9 Graham Stringer: Can you explain that to me? If you know that I am responsible for my vehicle, I consider that to be personal information. Why don’t you?

David Evans: It is not disclosing anything that could not be discerned from you by walking past your house where the vehicle was on a drive. The access to the drivers’ database that Mr Tse was talking about, where the authentication is important, is to find out how many penalty points are current on your licence or whether there are any restrictions to the kind of vehicle you may drive because of any conditions you have. That would be information that the customer would offer under consent for us to confirm that that is what the database records. For vehicles, we use the "reasonable cause" legal gateway, where, if there is an allegation that some damage or harm has been done through the use of a vehicle, the only information the person who alleges the harm has is the vehicle registration number, then we will give them the details of the keeper from whom they can start to make inquiries about who was the operator of the vehicle at the time this harm was done. It is a point of first contact but it does not establish liability at that point.

Q10 Graham Stringer: You say you do it through the trade association of these parking companies. Not to put too fine a point on it, some of these parking companies are pretty close to the edge of illegality. I do not want to cast aspersions on all of them, but some of them are pretty dodgy characters who run these companies. How do you decide to which companies to release that information?

David Evans: If they are in the private parking field, the companies must be members of the accredited trade association, which is the British Parking Association’s approved operator scheme. That is the only approved operator scheme we have in the parking sector.

Q11 Graham Stringer: But so long as they join that organisation you will hand over the information as to who is the keeper.

David Evans: That allows them to make the request. We then have a series of information available on the website that is published, that we have agreed with the Information Commissioner, about the conditions that must pertain if we are to release a vehicle. They must give us the registration mark, details of the vehicle and they must say when the alleged offence took place. There is a series of information that they must have to be able to make the inquiry of us. If we are convinced by the details of the request and we know they are members of the approved operator scheme, then we can release the data to them and they are able to then inquire who the operator of the vehicle was when the offence took place.

Q12 Graham Stringer: How much do you charge them for that service?

David Evans: £2.50 per inquiry, which is put in place to try and recover the costs of the administration. We are not passing that back to the ordinary driving licence holder or vehicle keeper who pays their tax.

Q13 Graham Stringer: Do you think you could make a profit out of it?

David Evans: We don’t make any profit out of it.

Q14 Graham Stringer: Do you think you could? Would it be a way of making savings?

Simon Tse: The way that we gear that part of the business is to cover our costs. If I look at how much revenue we take-and this is the whole release of data and not just the parking industry-it is £9 million a year. Out of the £690 million in revenue terms from fees, etc., which we take in any one year, £9 million of it is from the sale of data. By far the biggest part of our data goes to the public sector. If I look at the volume of data that we release in any one year, 21 million pieces of data are released. 16.7 million of that is to the public sector and 4.4 million is given to the private sector itself. Of that, it is only 1.2 million that is given to private parking companies through the trade association.

Q15 Chair: How many requests from private parking companies do you turn down?

David Evans: On paper, each one has to stand on its own and meet the criteria. We have to know the vehicle that is being talked about and what the occasion was-

Q16 Chair: Yes, but how many don’t meet the criteria?

David Evans: I could not give you a precise percentage.

Simon Tse: I could give you some details in relation to the number of reviews that we carry out. For example, we do just under 300 audits every year in relation to those companies to which we provide data to make certain that they are using that data in an appropriate manner. Over the last 12 months we have suspended six organisations to which we have provided data. Of those six, five are public sector organisations. That is not to say that they have been inappropriately accessing the database; it is more about their audit regime and their keeping records of why it was that they inquired on a particular vehicle at any time.

Q17 Graham Stringer: Can I return to the point? I still do not understand the principle behind why charging these parking companies cannot be a profit centre. You have given the figures. That is fair enough and I accept those figures. What is the principle that says you cannot make a profit out of this? I don’t understand that.

Simon Tse: Certainly in relation to the insurance industry access to the database, the product name is IIADD: insurance industry access to the driver database. IIADD as a product would be potentially the first one that takes us into a profit-making centre on that particular type of product. It is a discussion that is taking place now from a policy perspective. That decision has not yet been made, but it is now being looked at.

Q18 Mr Leech: Following on from Mr Stringer’s question, given the sort of money that these private organisations and some public local authority parking people, whoever it might be, are making, do you not think that, at a time when you are being expected to make savings, this would be an opportunity to recoup some of those savings and take a slice of the very large profit being made out of people parking illegally?

Simon Tse: Mr Leech, it is not how the product or the service has been configured. If that is something that the Committee would like us to take on board and consider, it would be a policy decision. It would need ministerial support but it is something that we could take away and look at.

Q19 Chair: Is that something that you could decide on your own, or do you need ministerial support?

Simon Tse: No, it is not. It is a policy decision and that would come out of the Department for Transport and a ministerial decision.

Q20 Mr Leech: Has there been no discussion between yourselves and Ministers about how you might be able to generate additional income?

Simon Tse: In relation to the insurance industry access to the database, yes, those discussions are taking place, but no decision has been made at this moment in time.

David Evans: On a wider scale, we are looking across Government about what is the value of data held by the public sector, and to whom and under what conditions it should be released and at what price. Our former Secretary of State was particularly interested in that and some work is under way to look at the pricing of data under data release. If I sat here and said that we sold data at a considerable profit, and hence had a motivation to release data to parking companies, the risk is that that would be likely to draw some adverse commentary.

Q21 Chair: You are telling us then that this whole area and the possibility of making a profit from it is under discussion, but there are no conclusions. You are having discussions with the Minister.

David Evans: It is under consideration.

Simon Tse: It is under review. There are other parts of our business that we are looking at as well, to be frank with you, in relation to potential profits for Government and more surpluses. For example, there is the sale of registration marks. Historically, the Agency has sold what we call personalised registration numbers. After we take our operating costs out of that, historically, we have delivered something in the region of £65.5 million to the Treasury for the sales of those number plates. Generally speaking, we sell £80 million worth of number plates a year. Over the last year and a half we have seen that number declining. Is that as a result of the state of the economy? Is it that the market is starting to dry up in relation to unique numbers? There may be a whole series of those sorts of things, but we have seen that the £80 million a year we take in that particular area has dropped to something of the order of £72 million, which is what we are forecasting this year.

We are considering how we go about addressing that fall in revenue. For example, we stopped all forms of advertising in and around personalised registrations. Has that contributed to the reduction in the sales or is it the state of the economy? Is it something that we, as Government, should be doing, or do I look to the private sector to drive sales on behalf of Government? Those are all things that we are considering as an Agency at the moment. A year ago, if you were buying a personalised registration number, the way that you would do that was to view them online but you had to buy them over the telephone. A year ago we launched the ability to buy those number plates over the web. Within the first week of putting it on the web, we found that 74% of our sales were being done over the web. That resulted in us terminating a contract-we were at contract renewal-with an external provider, because it was one of those elements that were outsourced, and it saved us £1 million a year by putting the ability to sell those number plates on the web.

As an organisation, we are looking at how we can develop that business even further. We are working with the industry, not just in terms of them selling the number plates on our behalf, because there is already a very large market out there for that, but we are also considering the release-and you may have seen it in our business plan-of previously issued marks. In the very early days of registration numbers being issued, some of those numbers were quite attractive in terms of things like ABC 1, for example. Where we, as an Agency, can categorically state that the vehicle that that number plate was on was destroyed or scrapped, and we have certifications to prove that, we are looking to release those number plates into the market. Something like ABC 1 has a higher value than some of the numbers that we now have left in stock. Those sorts of things are being considered at this moment in time.

Q22 Iain Stewart: Your business plan sets out a strategic business objective to seek costs savings by transferring as many transactions as possible online, and that is a laudable objective. Can you give me an assurance that for people who either do not have access to the web or for some reason do not wish to make such transactions online, there will still be an extensive network of outlets where they can do the transactions by paper?

Simon Tse: We are looking at a number of things in that arena. There are things like digitally assisted services. It is how those people who are not connected to the internet and don’t want to be connected to the internet, for whatever reason that may be, can go to a location and be assisted in doing that service digitally. Does that mean to say that that needs to be my network or other networks? That is all under consideration at this moment in time.

Q23 Iain Stewart: Specifically at the moment many people, if they are renewing their VED, would go to the post office with their insurance documents and everything. Do you envisage continuing using the post office as one of the outlets where you can do these transactions?

Simon Tse: The existing contract that I have with the Post Office expires in 2013. We are looking to go to the market in the not-too-distant future to look at how face-to-face services can be provided across the UK. That will be an open market situation that we are considering.

Q24 Iain Stewart: When would you expect to make a decision?

Simon Tse: Realistically, that decision has to be made by 2012 on the basis that, if, for any reason, the Post Office were not successful in winning that particular contract-and there may be a series of contracts within that yet to be defined-effectively, there would be a transition period of 12 months during that profile.

Q25 Iain Stewart: I have one further question on the online side of things and it is a slightly broader question. With more and more transactions being done electronically, you will be storing an enormous amount of data electronically. How are you protecting that data against either accidental loss or fraudulent, criminal cyber attacks?

Simon Tse: We invest heavily in that regard. If I look at the things that we have been doing over the last 12 months-and it is not just the last 12 months either-a large proportion of the amount of money I have spent with IBM, our current provider, is in making certain that the systems and the processes I have are secure. Rather than it just being one firewall and it is this big and that high, it is about compartmentalising and departmentalising all of the bits of information that we own. Gone are the days when you build the firewall as high and as wide as you can, because we recognise that somebody will eventually get through that. It is about limiting the amount of data they are able to get to in any one particular area. A significant amount of my IT spend is on our infrastructure programme within the Agency.

Q26 Iain Stewart: Have you had any attacks from criminal gangs trying to access it?

Simon Tse: Mr Stewart, we get attacked frequently. We have health monitor checks that are being carried out all of the time that sit in the background on our systems. But it is fair to say that we are a target, as are most large data houses in Government. We are constantly under attack, but we do the very best we possibly can to minimise the risks associated with such an attack.

Q27 Iain Stewart: Have you had any significant loss of data as a result of an attack?

Simon Tse: No.

Q28 Steve Baker: You have mentioned that most of your release of data is to the public sector. Is that in relation to ANPR or something else?

Simon Tse: It is effectively where the local authority has seen a particular vehicle, whether it is parked illegally, fly tipping or blocking a particular highway access. It is all those sorts of aspects. In terms of the 16.7 million bits of information that we give to the public sector, 1.3 million of it is about drivers and wanting to understand who the driver of a particular vehicle was. 15.4 million bits of data are about a vehicle and who the keeper of that vehicle is.

Q29 Jim Dobbin: You mentioned health in one of your responses. Everybody around this table would have to declare an interest in this. With regard to eyesight in particular, if you have to drive for a living, you have to have your eyesight tested on a regular basis. Do you think that should apply to all drivers?

Simon Tse: The current test that my colleagues in DSA use is effectively the 20 and 20.5 metre test in terms of scanning and looking at a particular number plate. The evidence that we have seen through that and the medical panels-the formal vision panel that we have of eminent physicians-suggests that that screening is still a sufficient enough test on eyesight.

David Evans: I would add that at every renewal of your licence you are asked to make a declaration as to whether you have any impediments to your vision. You are required to declare whether you do or you don’t. If you have certain conditions, we may choose to investigate those as we receive the application. If there is a question of diabetes, we might be interested in your eyesight and linking them up. We have medical specialists who are able to take a holistic view of a person’s health, looking at their age and the progression of any conditions they have. We test and investigate as necessary to try and make sure that we do identify that people are safe to drive.

Q30 Jim Dobbin: On the issue of diabetes, there is an EU Directive on that. Don’t you feel that here in the United Kingdom we are much harder on diabetic drivers?

David Evans: We have been successful over the years in not having a lot of road incidents involving diabetic drivers. We work with stakeholders who represent diabetics to ensure that those people who are safe to be on the road and have a licence are able to hold their licence, but those who are not should surrender it or have it revoked following investigation and an understanding of their condition.

Q31 Jim Dobbin: Are you saying, on the two issues that have been raised, that there is not the need for more frequent eye tests?

David Evans: One advantage of the screening test that we use of reading the number plate is that it is very much a test of the moment. You could replicate it today when you leave this building. A policeman who stops a driver can carry it out at the side of the road. A doctor or health worker working with you could suggest that you take it. It is quite simple and easy to do. If people do test themselves regularly against it, they will maintain an awareness of what the standard of their vision is. If there is any issue, they can go to the optician, get it tested and corrected, if necessary. It can be as simple as changing new lenses for your spectacles to bring your vision back into the standard. If you cannot meet the standard with corrected eyesight, then you should tell us and we will investigate why. All your driving licences should contain a code on the back that shows if you have declared you need eye correction or vision correction in order to drive safely. At any time if you are stopped by a policeman and he looks at the back of your licence, he will know whether you should be wearing spectacles or lenses or not.

Q32 Graham Stringer: What evidence do you have of how many licences you issue to people who should not have them and whose eyesight is impaired?

Simon Tse: I do not believe I have that-not specific to vision. I can relay information to you with regard to health in general, if that would be helpful.

Q33 Graham Stringer: The question I am really getting at is that you say the system works, but I had a horrific case in my constituency where half a family was wiped out by a 90-year-old driver who did not even know he had killed three people until the car was stopped. He had been issued by you with a driving licence on self-certification. There must be more than just that one case. What evidence base do you have for continuing with that self-certification policy?

David Evans: The evidence base we have is that every driver who has a licence has declared under law that they have adequate vision. If we have not required them to take a vision test, I have no further evidence than that. If I have required them to take a visual examination, I have a measurement of their acuity, their visual fields and their perception of depth that we are able to analyse. If somebody denies us the opportunity to investigate them by making a false declaration, I would not have any evidence on which to stop them or call their licence in unless they were stopped by the police or were subject to a third-party notification by their doctor, a member of the family or a member of the public that they believe this person-

Q34 Graham Stringer: Do you not think you should do some research in that area so that you do know how many licences you are issuing to people who clearly can’t see where they are going?

David Evans: It is difficult to get the information without requiring everybody to go and take the test.

Q35 Graham Stringer: You could do research on a sample basis in the way that research is normally done, couldn’t you?

David Evans: We can take that to the Secretary of State’s honorary medical panel on vision.

Q36 Chair: Have you identified this as a problem area?

David Evans: We do not have any evidence that there is a particular problem with driving where people cannot see. There are individual cases that occur where problems are found. We have a system of third-party notifications by family members, doctors and others who have observed somebody. We find we receive thousands of these a year, where we will start an investigation, as long as we are content that it is not a malicious notification.

Simon Tse: If I can give you some idea of the scale in that whole medical arena, Mr Stringer, so that you can get an appreciation for it, in any one year we get 711,000 declarations coming to the Agency. That is where an individual has declared some kind of medical condition, not just in regard to vision. 128,000 of those are what we call simple cases, where our team can review them and a decision is made based on the evidence that the individual has provided. There are 583,000 that are more complex. That means we need to investigate further and we will engage with the individual’s GP or consultant, or even our own GPs that we have contracts with throughout the UK, and they will get an assessment. So there are 711,000 new cases a year coming through.

In terms of revocations-where we have seen something within that where we feel we need to revoke the licence-there are 64,000. We revoke less than 10% of what we review. As my colleague said, in terms of third-party notifications, last year there were 10,000. Specifically in relation to the police and GPs, we had 2,000 incidences where the police or a GP gave a referral to us. In that particular area, for police and GPs, we have a specialist service where we will turn a decision around for them within 24 hours.

Q37 Mr Leech: How confident are you that the renewal of the vehicle licence is user-friendly enough for people to recognise that they need to check something like eyesight? When I renew my tax disc each year, I was not even aware until you mentioned it that there was some declaration which suggested that you may have to say you had a problem with your eyesight.

David Evans: Apologies if I have been unclear. We ask you when you renew your driving licence, not your vehicle licence. Every 10 years that you have to renew your photograph on your licence, or if you change address and have submitted details to us, there is a question on whether there are any problems with your vision.

Simon Tse: Mr Leech, specifically on the vision part of this, we do information leaflets that go out with most of our transactions. We have a cycle on the motoring franchise of Directgov, whereby the vision aspect comes up at least once a week during a month period. We are raising that all the time. Can we do more? Yes, I have no doubt we can. I know my colleague Mr Evans is working with industry now in terms of how we can raise even more awareness through the UK in terms of vision conditions.

Q38 Mr Leech: What happens to people who are still driving with paper licences who do not have to renew their licences every 10 years? They are not getting anything to remind them.

Simon Tse: No; they are not. Effectively, we do work on the web and with opticians throughout the UK. We are providing information to them so that they can relay that to their patients. Of the 44 million drivers in the UK, there are still 11 million that are on the paper licence.

Q39 Mr Leech: Those 11 million people may go 50 years until they reach 70, when they have to renew their licence.

Simon Tse: Unless they have gone to an optician, been advised by the optician and then it was a declaration that they need to make.

Q40 Kwasi Kwarteng: Do you think that is a satisfactory state of affairs, following my colleague’s point? You seem pretty relaxed about the fact that there might be people who have severe problems with eyesight driving around the roads. We have heard one story from Mr Stringer’s constituency which is quite alarming, but you seem pretty relaxed about it.

Simon Tse: Mr Kwarteng, we take medical issues extremely seriously as an Agency. I would not say I am relaxed about it. What we are saying is that we do not have enough evidence in front of us to suggest that. I do understand completely that there are individual cases. We are not seeing the volume of issues that are there, but it is something we can look at further in terms of investigating research and so on.

David Evans: If I may add, we react to every case that comes to us. We have to make a decision based on the information we have and the notification as to whether we call somebody in and require them to go for quite a detailed eye examination. If we do require this, we have a team of medical professionals who will study the evidence that comes back from this and make a decision about whether they are content that this person meets the legal standard for driving or not. If they don’t, we will revoke them.

Q41 Kwasi Kwarteng: The concern from the Committee that I have caught in the last five minutes is that perhaps you could be more proactive in that. Yes, it is all very well to react to stuff that is coming through your door, but to do a study surely is not that difficult.

David Evans: If somebody has poor eyesight, they get it attended to; they will get spectacles. There is access for people to go to an optician and get spectacles at low or no cost. Wearing spectacles is not something you only do for driving. Our system is based on the fact that people will manage their life, or how they work, how they run the house and how they can live, with correct vision.

Q42 Kwasi Kwarteng: If I were running an organisation like yours, I would be quite curious to know how safe the system was. I would be quite curious to know whether there were lots of people out there or not. There might not be any or there might be a very small number, but what surprises me is that you do not seem to be that motivated to find out.

David Evans: We have a record on every driver’s details of whether they require spectacles or eye correction. That is printed on their driving licence. It would be on the back of your driving licence.

Simon Tse: We do take advice from the honorary medical panels that we have, one of which is specifically on vision. But I do take the points that the Committee are raising.

Q43 Kwasi Kwarteng: You think that in this area you have it under control.

David Evans: We have a balance. To move from where we are, there are four million driving licence applications and renewals each year. If people were required to do an eye test or an examination, it would be £20 a head for each one of those. That would be an £80 million cost that would have to be borne by the motorist or by the state if they were for elderly, young drivers or people on benefit. There is a very serious cost impact, whereas we have the screening test where people can go out and read the number plate or see if they have difficulty reading the number plate of a car in the street. We have a screening test of the moment and then behind that, if you have a problem or you have poor eyesight, you are required to tell us and, if necessary, we will investigate it.

Q44 Chair: Are you saying that in general you are satisfied with the system?

David Evans: Yes.

Q45 Chair: I think that is what Mr Kwarteng is really asking you. In general are you satisfied?

David Evans: Yes.

Q46 Steve Baker: In all of this are you not just critically dependent upon people taking their personal responsibility seriously?

Simon Tse: Yes, we are. I was not being glib, but, yes, we are. The way the law is laid in the UK, it is about self-declaration. It is about the individual taking responsibility and advising, although we do have other vehicles such as GPs, opticians and so on advising us, even down to family members, who can advise us that they have concerns about an individual. We do get those coming through every year.

Q47 Steve Baker: I have two follow-up questions. Do you feel that your relationship with the Driving Standards Agency is adequate in relation to this question of personal responsibility when driving?

Simon Tse: Yes, I do. It is a sister agency. We work closely with each other on a number of aspects, even down to things like driver qualification cards where we work jointly to deliver that particular service to the UK. I produce the driver qualification cards on behalf of DSA, in terms of printing those physical cards. Yes, we do work closely with each other.

Q48 Steve Baker: I know we all take extremely seriously the consequences of irresponsible behaviour on the roads, but it seems to me that there is also a potential for these horrific consequences if people do not pre-emptively take responsibility. Are you satisfied that the penalties are adequate for not acting responsibly well in advance by, for example, having a sight test, or would you want them to be greater?

Simon Tse: I believe they are at this moment in time, but that is a matter for the judiciary rather than for me. I just record the information that is given to me. I believe I am content with what I am seeing at this moment in time.

Q49 Chair: There are 30,000 number plate providers. Is that making it more difficult to deal with fraud like cloning?

Simon Tse: First of all, there is an approved number plate scheme that runs across the UK. If I look at what we are doing at the moment, we are reviewing through the central department how that approved number plate supplier scheme works. There is a register of them. As a matter of course we work with the police and the Driving Standards Agency in terms of looking at fraud and how that can be overcome. We are working with the industry with regard to that. We may look to take that even further in the coming months and years, where our attention is drawn more to the raw material manufacturers of plates themselves so that we can make certain that whoever they are supplying the materials to are then providing those number plates in a correct manner and not taking it down to the fraud aspect.

Q50 Chair: Can you give us any idea of when you are likely to reach any conclusions on any changes?

Simon Tse: No, not at the moment. We are literally carrying out that review, but I will write to the Committee once we have the findings.

David Evans: Discussions are under way already through our industry liaison group. We have the manufacturers of the raw materials represented there. We are actively talking to them about how we can work closer with them to choke down the improper supply of raw materials that could then be used to manufacture false plates.

Chair: We would be interested to know more about what you are doing.

Q51 Julie Hilling: I want to ask about drivers driving with more than 12 penalty points on their licence. First, do you know how many people have more than 12 points and how many people have more than 20 points that are currently driving?

Simon Tse: If I take it in terms of court notifications, first of all, in any one year we get 762,000 notifications from the courts. That is all notifications that are coming through to us. In relation to those that are over 12 points, Mr Evans can help you.

David Evans: The latest figures we have were published in response to a Freedom of Information request. That identified that there were about 10,500 drivers who had more than 12 points but who were not at that time disqualified. They had the potential to be driving with more than 12 points. I am afraid I do not remember how many had more than 20 points.

Q52 Julie Hilling: Could you let the Committee know how many have more than 20?

David Evans: Yes.

Q53 Julie Hilling: The magistrates seem to be saying that people are only allowed one plea of special hardship. They seem to be saying that it is the DVLA’s fault that so many people are driving with more points because they should have had their licence withdrawn. Would you accept responsibility for that? Why are there so many people who are driving at a point when most of us would think they should have been banned?

Simon Tse: The courts have access to our systems. At the point of sentencing they are able to see, through our systems, how many points are on a licence at any one time. In relation to your question of whether I accept responsibility in terms of the magistrates blaming us, no, I do not. It is a matter for the courts to do the revocation, as in the disqualification. It is my role to revoke the licence, but it is their role to make the disqualification. It is a matter for the courts. I merely record the information that the courts give us.

Q54 Julie Hilling: If the court gave somebody three points or six points which took them over the top, what happens? There seems to be something wrong with what is happening.

Simon Tse: If I go back to that number of 762,000 in a year, it is suggested to us that 19,000 of those are over 12 points, and the court has not taken action. What happens is that we write to the individual court to advise them that this particular case was over 12 and ask them if they meant to apply hardship conditions to that particular case. It is then up to the courts to decide whether or not they want to call that individual back in and change the sentence in terms of what has been given. That being said, that can be done in England and Wales, but that does not apply in Scotland. They are not able to call the individual back in Scotland due to Scottish law.

Q55 Julie Hilling: Is there an issue then? Most of us think that you get to 12 points and you are automatically banned.

Simon Tse: It is not an automatic ban. It is down to the court to determine whether or not they want to disqualify that particular individual. As I said earlier, from the evidence that we are seeing, there are 19,000 of those in any one particular year. Then we do write to the courts and advise them that, for whatever that reason is, they did not ban that individual. We are working with the Courts Service and with the police. Our Minister has asked for a root and branch review of how it is that we and the Courts Service work with each other. As part of that review, communication has come up as one of the main points, which is why we now write on all of those instances where they are over 12 to make certain that the courts have carried out the correct action.

Q56 Julie Hilling: Do you know how many of those 19,000 are then disqualified?

Simon Tse: I do not have that information.

David Evans: If I could come in there, the Magistrates’ Association recently published some information where they reported that about 11% of the drivers who stood before them with 12 points or more were not disqualified because of the exceptional hardship provisions. I have no reason to dispute that figure.

Q57 Julie Hilling: Do you think it is acceptable that so many people are driving with so many points on their licences?

Simon Tse: That is a matter for the courts and not for me. I merely record the information that the courts give.

Q58 Graham Stringer: Are there circumstances where it is not a court decision, where people can drive with more than 12 points on their licence?

Simon Tse: No. It is the court that makes that decision.

Q59 Graham Stringer: What I was thinking about is, if people acquire nine points in Northern Ireland and six points here, are they legally allowed to carry on driving without the court making an exemption for them on hardship grounds?

David Evans: That is moving us into the recognition of offences. We do not recognise all points as equal. If we took other member states’ drivers, it is certainly possible that a driver could be disqualified in this country for an offence, and when they leave the country to return home their licence is returned to them because they have not been disqualified in their home country. There are some oddities with driving in countries other than where your nationality is.

Graham Stringer: That is interesting.

Q60 Chair: Have you identified areas where you would like change in passing on information here to drivers’ records elsewhere?

David Evans: It is not a priority of our Ministers to exchange data between member states cross-border about offences. It has not been a priority so far.

Q61 Chair: But would it be a priority of the Agency?

David Evans: If it was a priority of the Agency, we would have to go to Ministers to seek their view on it.

Q62 Chair: Have you done that?

David Evans: Recently our Ministers chose not to opt in to a cross-border system.

Q63 Chair: But had you requested them to opt in?

David Evans: The request did not come from DVLA. It was not specifically one of our areas of competence but it was about cross-border information, and the UK opted not to join in.

Q64 Chair: But were there requests for the UK to opt in?

Simon Tse: Not that I can recall.

David Evans: Not from us.

Q65 Mr Leech: I have a point of clarification. You said in an earlier answer that, if someone goes over the 12 points, you write to the court to tell them that they have gone over the 12 points. By that, were you suggesting that there are occasions when the courts are not aware that the person who has come before them has ended up with over 12 points because of the penalty that has been imposed?

Simon Tse: We have seen some evidence of that. That is why we now write to the courts, to make certain that they did mean to apply hardship in that particular case. There is an onus on the courts themselves, as there is for the police forces, to make certain that the information that they are putting before the bench is sufficient so that the bench can make an informed decision.

Q66 Mr Leech: What sort of numbers are we talking about where courts do not realise that someone should be losing their licence under the totting-up process?

Simon Tse: Mr Leech, I do not have that information. As I said earlier, where we have seen that it was over 12 and they have not taken a decision to disqualify that individual, it is 19,000 across the UK in any one year.

Q67 Mr Leech: But would you have any record of these numbers?

Simon Tse: No; I do not believe I have.

Q68 Mr Leech: I assume that, when you write back to the courts and remind them that they perhaps might want to recall somebody to ban them, you would then be informed that someone has been returned to court and banned.

David Evans: Not necessarily, no.

Q69 Chair: You say you are not told.

David Evans: We may hear nothing from them.

Q70 Chair: What would happen? You might inform the court and then you would not necessarily get a response.

Simon Tse: That is correct, yes.

David Evans: If the person was up in court again, then their record would show the number of points that they had, which, in that circumstance, would be above 12 when they had stood in front of the magistrate. If they have pleaded exceptional hardship once and they clearly have more than 12 points, then the magistrates would expect not to hear such a plea or to accept it again and to disqualify, if that was their decision.

Q71 Chair: But, from where the Agency is, you would pass the information on?

Simon Tse: Yes, we would.

Q72 Chair: Even though you would not necessarily know what has happened after that.

Simon Tse: That is correct.

David Evans: We try as belt and braces, yes.

Q73 Chair: I want to ask you about staff satisfaction. On the Civil Service People Survey, the ratings in terms of your Agency appear to be below the civil service average, particularly in relation to satisfaction with the categories "My work" and "Learning and development". Does that cause you any concern?

Simon Tse: If I look at us as an overall Agency, first of all, in terms of engagement, which is the primary score there, this year we came out at 55%. That is a one percentage point increase in terms of overall engagement. In terms of those people contributing to the survey itself, we had a 4% increase in that to 66%.

There are three areas in particular to do with engagement. There is "Leadership and managing change", "My work" and "My line manager". In "Leadership and managing change", that is at 37%. There is still more work that the managers across our organisation need to do in terms of making certain that, when we do change across the Agency, our staff understand why it is that we are doing that level of change.

In relation to "My workspace", 61% was the overall rating in that area. In terms of "My manager", and "Am I confident in the way that my manager interacts with me? Are they setting the right set of goals", etc., that was 68% for us as an Agency.

It is interesting when you start to look at the numbers. You have mentioned "Learning and development", and that was a four percentage point fall for us this year. But the highest score that I have as an Agency is 88%, in that "I have the skills to do the job that I am being asked to do." It is in the space for us whereby somebody wants to progress their career in our organisation or elsewhere that we need to do more work in terms of learning and development.

We have launched a number of schemes in the last 18 months from first line manager talent pools to administrative officers and a talent pool for them where we are developing those individuals. I do recognise, Madam Chair, that there is more work to be done with regard to learning and development for my staff in the Agency.

Q74 Chair: Can you tell us what you are doing to recover more of the money owed through vehicle excise duty? The National Audit Office said that you should be doing more to chase up debt.

Simon Tse: If I look at evasion in the UK, it is monitored through an annual survey, which is independent. Bear in mind that in any one year we collect £5.8 billion of vehicle excise duty on behalf of the Treasury. I have the second lowest recorded evasion rate in the UK at 0.9%. That means, effectively, that I am not collecting about £50 million worth of vehicle excise duty. That is the second lowest score that the Agency has ever had. For us it is not necessarily about enforcement; it is about compliance. Our whole system is geared toward making it easier for our customers to comply rather than not comply. We have talked about things like being able to go to the post office or being able to do the service online and how easy that transaction is. It is those sorts of things that we are doing on the evasion rates.

David Evans: If I might add, there is one further specific measure that probably addresses the NAO’s concerns directly. By the middle of next year we will have brought forward the date at which we pass on the non-payment to debt collectors from two months after the vehicle has become unlicensed to one month. We found that, if they move while the trail is still warm, they have better collection rates. That is addressing the money that is owing and getting on to it quicker. We expect to see that paying dividends.

Q75 Chair: You have changed from being a trading fund to an Executive Agency. How has that affected your work?

Simon Tse: It has not. Regarding the change in trading fund status, if I go back a number of years, the Agency was set up as an Executive Agency and a trading fund. It was an anomaly in Government inasmuch as we were unique and that we were a trading fund but we were not given full corporate body status. Under the work that was carried out last year by the Treasury in what was called the "clear line of sight", we were at that point in time the only Agency in the UK that did not have full corporate body status but yet was a trading fund. To enable us to comply with the "clear line of sight" work that the Treasury had done, the decision was made between Treasury, the central Department and ourselves that the right thing to do was to revoke our trading fund status, which was done on 1 April this year.

From a business operational perspective, there is no change whatsoever. It is more about an accounting practice. 95% or 97% of my annual return will be exactly the same as it is today, other than the way that the numbers are presented for about 3% of it. At a practical level, Madam Chair, there is no change in the way that the trading fund status was revoked from us as an organisation.

Chair: Thank you very much for coming. Those are all our questions.

Prepared 25th November 2011