Ofcom Annual Report
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The Office of Communications Annual Report and Accounts for the period 1 April 2011 to 31 March 2012 Session 2011/2012 HC 237 Ordered by the House of Commons to be printed 10 July 2012 ISBN: 9780102979084 CORRECTION Correction made to page 118 In the ‘Category A’ table in the ‘Total on issue as at 31 March 12’ column: - the figure for ‘CB, Amateur and Maritime’ should be 196,257 (not 15,887) - the figure for ‘Total for Category A’ should be 212,144 (not 31,744) Correction made to page 120 In the ‘Total Number of Licences – All Categories’ line at the foot of the page: - the figure for ‘Total on Issue as at 31 March 12’ should be 294,688 (not 114,318) November 2012 LONDON: THE STATIONERY OFFICE This is the ofcom annual report Annual Report 2011 /12 The Office of Communications Annual Report and Accounts For the period 1 April 2011 to 31 March 2012 The Office of Communications Annual Report and Accounts For the period 1 April 2011 to 31 March 2012 Report and Accounts presented to Parliament pursuant to Paragraphs 11 and 12 of Schedule 1 of the Office of Communications Act 2002. Ordered by the House of Commons to be printed 10 July 2012. HC 237 LONDON: THE STATIONERY OFFICE £29.75 © Ofcom Copyright (2012) The text of this document (this excludes, where present, the Royal Arms and all departmental and agency logos) may be reproduced free of charge in any format or medium providing that it is reproduced accurately and not in a misleading context. The material must be acknowledged as Ofcom copyright and the document title specified. Where third party material has been identified, permission from the respective copyright holder must be sought. Any enquiries regarding this publication should be sent to us at [email protected] This publication is available for download at www.official-documents.gov.uk. This document is also available from our website at www.ofcom.org.uk ISBN: 9780102979084 Printed in the UK for The Stationery Office Limited on behalf of the Controller of Her Majesty’s Stationery Office ID: 2495460 07/12 Printed on paper containing 75% recycled fibre content minimum Contents Section A Section D 5 Who we are and what we do 70 Operating and financial review 6 Chairman’s message 75 Certificate and report of the Comptroller and Auditor General 8 Chief Executive’s report to the Houses of Parliament 76 Statement of income and expenditure Section B 11 An overview of the markets 77 Statement of financial position we regulate 78 Statement of changes in equity 12 Progress on delivering against 79 Statement of cash flows our annual plan priorities 80 Notes to the accounts 27 Our ongoing responsibilities and the resources we manage Annex 36 How we manage risks and challenges 107 Regulatory Statements 38 How we work and who we work with 112 Broadcasting complaints, 44 Our employees cases and sanctions 46 Corporate responsibility 115 Statistical data 47 Sustainability report 116 Investigations programme 117 Spectrum engineering and enforcement – key Section C performance indicators 49 Governance statement 118 Spectrum licensing 50 The Ofcom Board 121 Sustainability Report 65 Statement of responsibilities 66 Remuneration report 123 Glossary of terms 2011/12 “We make sure that people in the UK get the best from their communications services.” 4 | Ofcom Annual Report & Accounts 2011/12 Who we are and what we do The Office of Communications (Ofcom) is the UK’s independent communications regulator. We regulate the TV and competition. This underpins much of • people who watch television and radio sectors, fixed-line what we do. The Postal Services Act listen to the radio are protected 2011 says that Ofcom must secure the from harmful or offensive material. telecoms and mobiles, provision of a universal postal service. We handle complaints about the airwaves over which television and radio broadcasting We are involved in advising on wireless devices operate and assess each complaint against and setting some of the more the Broadcasting Code or other and, since 1 October 2011, technical aspects of regulation, relevant codes or licence conditions; postal services. as well as implementing and enforcing communications law, • people are protected from being competition and consumer law. treated unfairly in television and We ensure that people in the UK get radio programmes, and from having the best from their communications Ofcom is funded by fees from industry their privacy invaded; services and are protected from for regulating broadcasting and • the radio spectrum (the airwaves scams and sharp practices, while communications networks, and grant- used by everyone from taxi firms allowing competition to thrive. in-aid from the UK Government for and boat owners, to mobile-phone undertaking concurrent competition Established under the Office of companies and broadcasters) is used regulation and managing the radio Communications Act 2002, Ofcom in the most effective way; and spectrum. We work independently, operates under a number of Acts of free from political influence. • the provision of a universal Parliament and regulations, including postal service is financially the Communications Act 2003, the sustainable and efficient. Wireless Telegraphy Act 2006 and the What we do Broadcasting Acts 1990 and 1996. Our main legal duties This legislation sets out what Ofcom are to ensure that: What we do not do should do and how we should do Ofcom has powers to enforce • the UK has a wide range of it. More recent legislation includes consumer law on behalf of consumers electronic communications services, the Digital Economy Act 2010 and generally. Ofcom does not have the including high-speed services, such the Postal Services Act 2011. power to resolve individual consumer as broadband; complaints about telecommunications The Communications Act 2003 • there is a wide range of high- services, unlike TV and radio, but says that Ofcom’s principal duty is quality television and radio we provide advice to individual to further the interests of citizens programmes, appealing to a complainants and refer them to the in relation to communications range of tastes and interests; two Alternative Dispute Resolution matters and to further the interests (ADR) schemes that we have approved. • television and radio services of consumers in relevant markets, There is also an ADR scheme for are provided by a range of where appropriate by promoting post that we have approved. different organisations; | 5 SECTION A CHAIRMAN’S MESSAGE Chairman’s message Colette Bowe The communications And with new powers from Parliament that our third round of community sector is more important in the past year, we are starting to radio licensing got under way in to the UK than ever. I see clear up the confusion so many the past year, commencing in Wales people face about call charges to and the West of England. We have this in the detailed market certain number ranges, starting moved ahead with the licensing of information Ofcom collects with proposals for making 0800 new local TV stations, including for and publishes, and I see it numbers free to call from mobiles. Belfast, Swansea, Edinburgh, Cardiff in the everyday consumer Ed describes some of these steps and Glasgow. In May we published experiences of services that, in more detail in his report. our report to the Secretary of State on the future licensing of channels in some cases, did not exist Communications services UK-wide three and five – the final decision for even a few years ago. which is likely to have a bearing on the As communications services become provision, in particular, of television more central to people’s lives and news in the devolved nations. This growing importance and this work, so do the benefits of their pace of change place a particular widespread availability, including in The UK Government’s decision to responsibility on Ofcom to ensure Scotland, Wales and Northern Ireland. provide £150m to extend 2G voice that consumers continue to get a fair The devolved administrations in mobile coverage to areas where it is deal wherever they are in the UK. Edinburgh, Cardiff and Belfast are all currently poor or non-existent is also a Over the past year, we have made taking steps to improve their nations’ significant step. The expected increase good progress. We have banned competitiveness and connectivity in the number of base stations has contracts that automatically renew, and I am keen that Ofcom continues in turn helped to make it possible helped push down charges that to work productively with them, the for us to propose a higher coverage customers face when leaving Scottish Parliament, the National obligation on one of the licences a contract early, and published Assembly for Wales, the Northern providing the next generation of authoritative new information on Ireland Assembly – and, of course, high-speed 4G mobile broadband, complaints levels and broadband the UK Parliament and Government. when we begin the auction process later this year. Even allowing for the speeds. We have come down harder Late last year Ofcom began a greater proportion of rural areas on rule-breaking practices that significant new project to understand in Scotland, Wales and Northern cause harm and distress, cutting the and explain in detail why some Ireland, there is the potential for number of silent and abandoned communications services are not 4G coverage to reach 95 per cent calls and reducing by nearly a third available as widely as others, and of all households in each of these the complaints made to us about the public interventions that seek to nations. Until now, much of the focus mis-selling of landline services. secure greater coverage than would has been on competing industry be commercially viable.