Examination of Witnesses (Questions 180
MONDAY 22 APRIL 2002
180. I want to pick up the point about the extent
to which this is over-engineered and gold-plated. I understand
about having coverage and I understand the point about having
encryption. What I am not certain about is the value which was
added for the additional costs of some of the extra features.
The gain that has been mentioned to us fairly consistently, and
in paragraph 13 of the summary for example, is avoiding police
officers having to go back to the station and all the rest of
it. Surely they do not need the capacity to roam throughout the
whole United Kingdom in order to be able to contact their headquarters.
Very low-tech provision, indeed a secure land line almost could
enable them to contact the station rather than having to travel
back in again. May I just clarify a point on roaming? How many
officers normally operate outwith their own force areas as a percentage?
(Mr Gieve) I do not have that.
181. Could you get that, please?
(Mr Gieve) Yes. I might be able to. I shall look for
182. How many times as a percentage of calls
does one headquarters at the moment have to contact another headquarters
on an urgent issue which has to go across a force boundary?
(Mr Gieve) I do not have a figure as a percentage
of all the calls made. I imagine that the bulk of all calls are
local but it is a regular business that police headquarters will
be dealing with.
183. How regular?
(Mr Gieve) I do not know. If you take for example
the National Crime Squad, counter-terrorist operations, these
are all nationwide operations and they all require this.
184. I understand that. I just do not have a
feel from this what the additional cost is of having a roaming
ability as compared to the number of officers who would actually
use it. You have indicated nothing that would give me any idea
as to what that would be.
(Mr Gieve) I shall come back as well as I can. Just
to get the figures clear, the £1.47 billion is the cost over
20 years of supplying a radio system and any radio system would
cost quite a lot.
185. I only have a limited amount of time, so
I do not want you to go back and tell me all the things I know
already. One of the gains from the system was intended to be interoperability
which we are now not going to have. Was interoperability between
all the different emergency services really priced in at all in
(Mr Gieve) We are going to have interoperability across
the Police Service.
186. Across the emergency services.
(Mr Gieve) As far as the Fire Service is concerned,
which was originally in, they withdrew before we got to the costing.
187. Was an estimate made of how much would
be gained by the police in having interoperability with the Fire
(Mr Gieve) In terms of putting a price on it?
(Mr Gieve) No; I do not think so.
189. It just seemed like a good idea. If this
was one of the main gains, I would have thought there was some
sort of value attached to it, but no. We recognised early on that
police authorities know their area, know the value of particular
provisions. According to the summary in paragraph 13, "During
the procurement, many police authorities considered that Airwave
was prohibitively expensive". Presumably then they were regarding
it as over-engineered for their needs.
(Mr Gieve) For their local needs.
190. What other needs are there?
(Mr Gieve) They are part of a national Police Service,
so it is quite possible that the sum of the local needs will not
add up to a coherent and satisfactory total picture, which is
why the Government have powers and are taking more powers to set
a national policing plan, precisely to make sure that we do get
a coherent picture.
191. Did you identify a value as being above
and beyond the local advantages, which presumably the local authorities
or the local police boards were pricing and saying this was too
expensive? You identified a value from having this roaming ability
and interoperability and all the rest of it. Can you tell me how
much that was?
(Mr Gieve) The figure in the report is £300 million,
although that was not hugely well supported. That was the cost
difference between having Airwave and an estimated cost of having
a set of local procurements.
192. With respect, that was not what I asked
you. What I was asking was what the value to you was. You paid
out £500 million to police authorities to enable them to
buy this scheme which they thought was too expensive. Presumably
then it must have been worth more than £500 million to you
to pay £500 million out. Therefore you must have had some
calculation that led you to believe that it was worth more than
£500 million because presumably otherwise you would not have
done it. What was the figure?
(Mr Gieve) Those are two separate questions. In terms
of value for money for the country, the figure is £300 million
or thereabouts, which is what it would cost to do this system
rather than that system. The question for us on the £500
million was within our total budget, some of which might have
been going to the police anyway, we found £500 million and
channelled it through this means. That was worth doing as a means
of getting them to apply a system which was worth having.
193. So you do not have an answer to the points
I was raising. You can understand why I am a bit anxious when
almost everybody else who looked at this scheme did not think
it was value for money. None of the local police forces thought
it was value for money, the Fire Service did not think it was
value for money and the jury is out to some extent on the Ambulance
Service. On reflection, do you not think that perhaps it has been
(Mr Gieve) I do not accept the first premise that
no-one thought this was value for money except the Home Office.
Is that your starting point?
194. Not all that far away from that.
(Mr Gieve) Before we announced the £500 million
I gather 39 of the police forces in England and Wales out of 43
had indicated they would proceed with Airwave. The specification
you are talking about and saying is gold-plated is one drawn up
by the police authorities. We had a major consultation.
195. If it was drawn up by the police authorities,
why did many police authorities consider that Airwave was prohibitively
(Mr Gieve) Partly because they probably thought they
were in a negotiation with us for funds.
196. So they were misleading us all really.
(Mr Gieve) No, I do not think so. They thought that
if they had to use their money they would prefer or might be forced
to do with less functionality.
197. Yes; absolutely. If they were using their
money, they would have preferred to make do with less.
(Mr Gieve) Yes.
198. But if they were spending your money, they
would take these extra features. There is an issue here in terms
of the local police authorities believing that some of the add-ons
were not value for money, basically.
(Mr Gieve) There was also, no doubt wrapped up in
that, the question of whether they thought it would work, because
this is an unproven technology. They were taking a risk on this
199. Mr Parris, the 17% profit. Anxieties have
been expressed here as to whether or not the add-ons will give
you much more. Are you prepared to open your books to the Home
Office to let them see how much profit you are making as the contract
(Mr Parris) The 17% figure you quote and which is
in the report has been acknowledged as an estimate of our return
from this contract in isolation. What we made clear at the time
and we still stand by, is that we would not have done this project
in isolation for the police at that return. We have taken this
project on, on the basis that it would give us an opportunity
to be able to market it to the Fire Service, the Ambulance Service
and such like.
9 Ev 24-25. Back