This extended briefing addresses confusion and uncertainty at the DWP. It also pre-announces the launch of a specific campaign to restore equity to the cost of accessing public services, which is adapted to the demands of the present financial situation. (See My Proposal.)
Following its recent excellent action in making 0800 numbers free to call from mobiles, it is most disappointing to find the DWP agencies still unable to resolve the situation with their expensive 0845 numbers, by recognising that they must switch to 03xx numbers. Calls to 03xx numbers are charged at the same rate as calls to geographic numbers.
A written ministerial answer provided to Caroline Lucas MP fudges the issue with misleading and false information. I am amazed that the DWP still either does not understand the truth of the situation, or deliberately seeks to mislead.
In response to this written answer, I have provided a full briefing to Dr Lucas, Mr Webb and Mr Singh, which is published at this link.
I have also added an annotation to the published record.
Answering the "impossible" question
I provide answers to what is said to be an "impossible" question - "what does it cost claimants to call 0845 numbers used by the DWP?"
£ On average they pay £1.24 per call. For a 03xx (or geographic) number, this would be £0.51, less than half the cost.
(Details of the basis for this calculation of a weighted average cost based on the likely usage of particular tariffs are given in my full briefing.)
It is straightforward to provide figures taken directly from published tariffs, using the DWP assumption of an average call being of 10 minutes. The cost of calling a 0845 number is compared with that for a 03xx (or geographic) number.
£ If calling from a public payphone - £2.40 (vs. £0.60) £ From a typical PAYG mobile - £4.15 (vs. £1.65) £ From a typical contract mobile with inclusive landline calls - £2.00 (vs. 0) £ Those who are at home all day with a Virgin Media landline - £1.12 (vs. 0)
These same figures obviously apply to a 10-minute call to NHS Direct, HMRC enquiry lines or any other 0845 number.
What the DWP (and other public bodies) must now do
"Virtual telephony networks", such as those used by DWP, can be accessed using 03xx or 08xx numbers.
With 0845 numbers, surcharges are levied on callers because part of the call price is used to subsidise the cost of the "virtual telephone network", through "revenue sharing" between the originating and terminating telephone companies. When calling a 0845 number, you are not only paying whilst you wait to be answered by an agent you are also paying extra for the provision of the facilities that route your call, allow you to queue and provide management information.
With a 03xx number, callers pay no more than they would to call an ordinary "geographic" number (01/02). This is by regulation, which applies to all companies providing landlines, mobiles and payphones, including the terms of unlimited packages and bundles. Revenue sharing is prohibited on 03xx numbers.
There is currently no regulation on the extent of the premium charge that may be levied for calling a 0845 number. The examples given above are typical, however there are over 200 registered providers of telephone service in the UK and each of them has many different tariffs. They all incur greater costs in originating calls to 0845 and other revenue sharing numbers.
All public service providers that require the facilities available with “non-geographic” numbers must switch to 03xx numbers.
These provide equity and an assurance that callers are paying no more than the cost of an ordinary call, whatever that may be. Most importantly, with a 03 number it can be stated that the recipient is not benefitting in any way from any surcharge.
(If choosing to retain 0845 numbers public bodies must acknowledge and justify the imposition of service charges, at levels outside their control, on callers.)
BT Landlines - the exception
BT alone is subject to legacy regulation of its charges for landline calls to 0845 (and other "NTS") numbers; it is prevented from making any money on originating these calls. This unique special status and the consequent perverse low charges mean that BT should never be used as an example of the cost of calling 0845 numbers.
The level of BT's charges for geographic calls (including that for 03xx numbers) is not regulated. As these calls are included in unlimited Call Plans, its standard charge is zero. The penalty charge which BT imposes for making these calls outside the terms of a Call Plan continues to increase at an annual rate of 30% with the latest announced revisions.
Contrary to what is implied in the written answer, BT only originates 42.2% of residential landline calls, 31.4% of residential calls from either mobiles or landlines.
28% of socio-economic group DE households do not have a landline from any provider.
It can no longer be assumed that telephone calls from BT are the "norm" and that other rates can be disregarded.
Fair and equitable charges for accessing public services
Whilst some private companies are happy to receive money from customers who call them on revenue sharing numbers, I have always argued that it is not acceptable for public service users to have to meet the costs of a public body as they use its services. With some exceptions, I see it as generally acceptable for service users to themselves incur the expense (if any) of a normal call using their chosen telephone service provider, rather than having this expense reimbursed by the taxpayer.
For this reason it is vital that public bodies currently using 0845 numbers move over to 03xx numbers as quickly as possible.
To avoid the cost and disruption involved with a complete number change, there is a simple solution.
The 0345 equivalent of every 0845 number is reserved for use as a replacement or alternative. This feature could be used to enable equity to be re-established without the disruption and expense of lots of individual number changes.
The 0345 alternative for every 0845 number used by a public body should be immediately switched on.
Every public body that accepts the principle of equity and wishes to cease charging for access to its services could make a simple arrangement with its existing telephone service provider and issue a simple statement:
"All telephone services can be accessed by replacing the 0845 code with 0345 and dialling the remaining digits as stated".
This statement (perhaps better worded) must be made widely, however I do not see it as being essential that every number be printed twice wherever it appears. No existing publication would need to be changed. It would be for those of us who believe in equity to play a part in helping to spread the word.
There are three public bodies which are major users of 0845 numbers. They have all been thinking about this for a long time:
· The DWP and its agencies. To its credit, DWP has already dealt with the problem of 0800 calls from mobiles. It now needs to finish the job by dealing with its 0845 numbers.
· HMRC. Under attack for its problem with miscoding, HMRC angers people further by inviting enquiries about this to be made by calling one of its many 0845 numbers. The general issue of its use of 0845 numbers is already under formal review. Other users of 0845 and 0844 numbers are however representing the public interest in this exercise.
· The NHS. Directions to NHS bodies and changes to the GP contract require cessation of the use of expensive telephone numbers by 19 December 2010 and 31 March 2011 respectively. Most of those with 0845 and 0844 numbers have not yet changed and will now need to move swiftly to comply with these requirements. (The equivalent 0344 alternative is available for GPs and hospitals that use the even more expensive 0844 numbers.)
Although the benefit of subsidy towards the cost of advanced telephony would be lost - quite rightly as this is totally improper - those who make this move would find that they save themselves money overall. They all currently have a policy of calling back to those who cannot afford (or do not wish to incur) the premium charge which most callers suffer on 0845 numbers.
The level of the subsidy received (around 2p per call minute) is not only far less than the surcharge incurred by callers, it is also modest when compared to the cost of making a return call. By avoiding unnecessary callbacks, which are also very inconvenient and far more costly in agents' time, those who adopt this approach will save money, rather than incurring additional cost.
Fully planned rationalisation and changes of number is what should be done. In the current financial environment however, this will perhaps have to be deferred, as it can be a very costly exercise.
With household and public sector budgets under pressure and the vital need to ensure that the impact of cutbacks is distributed fairly - now must be the time to follow this simple and cost saving solution to a longstanding problem.