Select Committee on Transport, Local Government and the Regions Minutes of Evidence


Examination of Witnesses (Questions 60-79)

MS VANESSA LAWRENCE, MR DAVID WILLEY AND MR STEVE ERSKINE

TUESDAY 15 JANUARY 2002

Mrs Dunwoody

  60. Is there evidence to make sure those prices are clearly and easily available to everybody?
  (Ms Lawrence) Yes.

  61. So if I came on to your website I would find that if I were trying to organise a local leaflet?
  (Ms Lawrence) I would think so, yes. You mentioned about small groups who perhaps want to do sketch maps. We were doing a little calculation yesterday. Let us say you have got an A5 booklet which you are going to sell but which you are only selling for three or four pounds. It is just a contribution. You have 15 sketches within it and it is A5. We worked out that you would be paying to that 15p per copy, so it is a very small amount. We have worked over the last 15 months to make sure that that is accessible to people.

Chairman

  62. You just use the 1925 map which is out of copyright.
  (Ms Lawrence) Mr Bennett, there are lots of ways around it, I am sure.

Mrs Ellman

  63. Would you welcome HMSO as your regulatory body?
  (Ms Lawrence) We are in a very interesting position regarding regulation. We obviously wish to continue to make sure we are very open about what we do. We are happy if more and more people want to get to know what we do. There has been a lot of discussion in the industry about whether there should be a regulator, whether HMSO is the right regulator, and certainly we have watched this debate with interest. Currently HMSO plays a very important part with us and we are very happy with our working relationship with them.

  64. What is your view on regulation?
  (Ms Lawrence) My personal view on regulation? Having worked overseas in America I have looked carefully at regulation. I believe light touch regulation is fine.

Chairman

  65. You mean a regulator who does not cause you any problems?
  (Ms Lawrence) No. May I draw your attention to the fact that in America they have had regulators for, say, 25 years in the utility sector. They have worked quite well with them in collaboration with people understanding the business challenges as well as understanding the regulatory needs.

Mrs Dunwoody

  66. We are not talking about California Energy here, are we?
  (Ms Lawrence) No, we are not, Mrs Dunwoody. There are many other regulators and many other utilities besides California.

  67. I just want to be clear.
  (Ms Lawrence) I could not comment on that. Light touch regulation certainly seems to have made sure that the business is able to go about its duty but still bears representation through the regulator. However, in other countries you can see cases where the regulator is practically running the business.

Mrs Ellman

  68. What would you see as appropriate for Ordnance Survey here in this country now?
  (Ms Lawrence) Our current relationship is that HMSO acts in that way with us at the moment. Very much a light touch regulation is what I think is appropriate here. We are also small enough for people to come and talk to us at any time.

  69. Do you not feel it needs a firmer touch of regulation given the very powerful position you are in as monopoly supplier for the central information, the setter of prices? You are in a very powerful position.
  (Ms Lawrence) Perhaps I could first suggest, Mrs Ellman, that we are not actually a monopoly. At large scale increasingly and also at smaller scale for a long time we face competition. The only monopoly area is the work we do in the uneconomic areas that we have talked about which are covered by NIMSA. That is the nearest thing to a monopoly. As we are facing increasing competition every six months I think stronger regulation would be very inappropriate for the whole of the community. We have to be agile enough to be able to move to ensure that our own business is not eroded together with that of our partners. As soon as it does start to be eroded and as market share is taken by overseas organisations it certainly could be very damaging to this country's relations in the industry.

  70. Where do you feel that the organisations or individuals who have concerns about Ordnance Survey's activities should go to have their concerns heard? That could be companies who think that you are anti-competitive or recipients of your services who think that they are being charged too much? Where can they go if there is not a regulator?
  (Ms Lawrence) They go to HMSO at the moment.
  (Mr Willey) HMSO already does regulate the ability to license and onward sell our information. There is a strong element of working within their regulatory framework. The other regulatory framework which certainly does focus our minds very much is competition law. Clearly we have to abide by competition law both at European and at UK level. We are running a monopoly supplier where there is no money to be made but nevertheless we recognise that we do have a strong position on geographic information in the market. As such we have to be mindful of competition regulation which means you cannot overprice or underprice. You have to get the pricing about right. You cannot just ride roughshod over anything you want to do. You have to stay within that broad framework of competition legislation which concentrates our minds very much.

Chairman

  71. The litigation with the AA did take up quite a lot of money, did it not?
  (Mr Willey) Certainly the AA case was a big case for us. It was a case where we believed that the AA, since the early 1990s and even before, despite their best endeavours to set out to produce their own database, had nevertheless been using our material. We took out legal action in 1996. It was no light decision; it was a very decision that we took and it was going right through to conclusion in March last year, and it was fortunate that we were able to resolve that out of court before it went to court. The size of the settlement was a fair reflection on ten years of them using Crown Copyright material in their information.

  72. Would it not have been better to have had a regulator to deal with that?
  (Ms Lawrence) From my point of view, having joined the business only a few months before, David and I worked with Centrica to sort out this historical issue. I think it actually came down to a pure commercial issue rather than one of regulation. The biggest benefit for everybody was the fact that certainly by this settlement and the amount that was paid it was then fair for all the other licensees of this information who had been in the same market, of which there were some direct competitors to the AA in that market who were full licensees of ours for that time period.

  73. How far do the Government or some Government Departments ignore you?
  (Ms Lawrence) I very much hope that nobody ignores us, but we are extremely keen for more of central government to use our data. We believe that much of central government, certainly until say 12 months ago, had not a full understanding of the benefits of using geographic information. At board level and at senior manager level we have been working with many organisations across central government to get them to understand how they could use geographic information to better undertake their work. There are currently 40 central government organisations who are licensees of our information, some covered by central government service level agreement, some by individual contracts. We are very keen, and we also have the support of other government organisations, to try and implement a pan-Government service level agreement so that any of the organisations listed (and apparently we are looking at the list within the Civil Service handbook) would be able to use our information for internal business use. We believe that the spread of geographic information across government will lead to greater joining up of government. Currently this is under discussion and we have had some very helpful discussions with DTLR and the Office of the E-envoy, regarding making sure that it gets centrally funded because what we are planning is to make sure that along with the data we would also supply some experts who would be happy to go and help new organisations who perhaps do not have GI experts within their organisation to understand the benefits and of course will also stimulate the private sector to be able to work with them. We only supply data; we do not provide software and hardware.

  Chairman: Is this an argument with the Treasury that they should give you a bit more money, or is it an argument with the Department of Transport, Local Government and the Regions?

Mrs Dunwoody

  74. Or, even better, is it with the Cabinet Office?
  (Ms Lawrence) I would suggest it is not an argument with anyone.

  75. So you are losing?
  (Ms Lawrence) No, I hope I am not losing. What we are doing at the moment is about finding out who can help centrally fund it. There are many of those 40 organisations who obviously currently have set aside within their own budgets for Ordnance Survey mapping but it is about making sure that everybody will have access to that mapping. I am not quite sure which government department we are looking for to fund this.

Chairman

  76. How much money are you short of?
  (Ms Lawrence) Over a three year period we believe, because obviously as adoption goes up there will be greater usage, that the figure we are looking at would be £27 million. That would be the figure in year three but in year one it would be about £18 million.

  77. So what are these departments paying individually now?
  (Mr Willey) Across the 40 departments in the last financial year it was not far short of £18 million for all products and services for modern surveying.

  78. So it is £18 million and then you are talking about these figures on top of the £18 million?
  (Ms Lawrence) No, no, instead of the £18 million. It would move up to £27 million in year three. We could certainly send you a note.

Mrs Dunwoody

  79. But it would be a much wider circulation?
  (Ms Lawrence) Yes.


 
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