MONDAY 1 JULY 2002

MS SUE STREET, MR GREG DYKE, MR JOHN SMITH AND MS ZARIN PATEL

  80. You do have a robust prosecution policy?
  (Mr Smith) We have visited 4,200 dealers. When we visit, our aim is to check what records there are and, in so far as they are selling sets, that they are notifying us of that. That is what we do.

  81. Presumably it is an easy system, that every television that is sold could have a form inside and all they have to do is send that back?
  (Mr Smith) There is a form and it has to be filled in and it has to be sent by the dealer. You would expect the occasional hiccup. Occasionally you get the form and when it arrives it says, "Sold to Mr M Mouse".

  82. I return to the earlier question about flats, that the non-change of addresses was a waste of resources. I return to what the Chairman was talking about on page 31 at 17. Let us look at this page. Although I can understand that you do have difficulties, it looks as though a very wasteful exercise takes place. At the end of the day, the number of evaders that was caught was 12.3% of the visits made. The statistics show that no contact was reported with the person on the database; something like 57% of the occupiers were not at home or did not answer the door; 20% of the properties were vacant; 2% of the properties did not exist; 0.6% the householder had moved or gone away. It goes on to say that 3% the enquiry officers confirmed that, as claimed, there was no set at the property, so that was a waste of time as well. Then 1.5% of householders claimed to have no set and the enquiry officer was unable to confirm that. Something like 80% of the visits were basically a waste of time. That seems to me to be very wasteful. There must be some better way of doing it.
  (Mr Smith) The point about the deterrent I made at the start is so important for us. I cannot repeat all of that unless you want me to do so. It is so important for us to have the visible deterrent effect on the ground with people going around knocking on doors. It is amazing what a difference it makes. Having done it myself, I know that is the case. The other couple of things are that 460,000 people were caught last year by our enquiry officers. By the way, that is an update of the figures we sent to the Committee. 460,000—that's over 1000 people every single day of the week are getting caught by that operation. Bear in mind, as Mr Dyke said earlier, that we cannot turn the signal off in the way that some of the utility companies can. We cannot do that. We do not have that many levers to pull but one of them is going out visiting on the doorstep.

  83. How effective is the van? Presumably the van is more effective than somebody trailing the streets. If a van comes down the street, surely that is going to be more effective?
  (Mr Smith) It is fantastically effective.

  84. Why is that?
  (Mr Smith) It is all about a mixture of different things that make it absolutely clear that lots of things are going on to catch people. For example, if there were only the vans, if you lived in a street and never saw one, you might start to think: oh, well, I am never going to see one, so I am not going to worry about it. But when there are vans, posters, the person knocking on the door and things coming through the door, your neighbours, et cetera, all those things go together to build a picture of you not wanting to be caught. I think the report refers to our own market research about how people feel in terms of the likelihood of getting caught and 82% of people feel quite uncomfortable about the idea that they are going to be caught by this operation. That is really important.

  85. Finally, the statistics show something like 32% of people who are prosecuted then do not get a licence. They then get a statement of prosecution again. We had something like this last week when we were talking about people not paying their fines in magistrates' courts. It seemed to me that you might just as well not pay your fine because nobody is going to do anything about it. What do you do about it? If somebody has been fined for not having a television licence, and then does not get another one, what do you do?
  (Mr Smith) We have a 100% follow-up policy for people who then do not pay, having been convicted. We will continue to re-prosecute until such time as they pay.

  86. Are they fined exactly the same amount again?
  (Mr Smith) We cannot set the level of the fine, of course.

  87. What is it?
  (Mr Smith) I think I am right that our experience is that magistrates tend to take a dimmer view of people who are up before the court twice than of people who are only up once. We do not set that level. That is a matter for the magistrates' court.

  88. I am a great admirer of the BBC, although I think there might be other ways of funding it which would be more cost-effective. I accept there are risks involved in that as well. I am not necessarily a fan of the way in which this process is managed. I would like to ask some questions to see whether I understand how it is managed. The first thing is that the figures are difficult to get a grip on because, for example, you give the number of evaders identified as a number but then you give the overall estimate as a percentage. My first question is: what is your estimate of the number of evaders in the country? We have this percentage figure which has changed today, has it not?
  (Mr Smith) The figure is 2 million, and that is not just households; it includes business premises. On the model, the critical difference between the old and the new model is that the new model reflects all sorts of premises that require a licence, which traditionally would not have had one.

  89. The way I see it is that you were working previously on a figure of 5.2% and it is up to 7.8%, so there is a 50% increase on the original estimate— 2.6 %.
  (Mr Smith) It is probably important to be absolutely pedantic about this: the evasion rate under the old model at the end of the last financial year, which is March 2001, was 5.2%. Using exactly the same methodology, at the end of this financial year, March 2002, it would be somewhere between 4 and 4.5%.

  90. You are anticipating a line of questioning which I am not going to pursue. I am trying to say that management depends on management information. Frequently in this Committee we discover that management information systems are not as strong as they ought to be and it is very frustrating for management as well as for this Committee and others. It seemed to me that the estimate of the number of people evading is increased by 50% and 5.2% is 7.8%.
  (Mr Smith) I think you are comparing two different years.

  91. No, percentages are percentages. I think our methodology has changed and you go from 5.2% to a more accurate estimate of 7.8%, unless I am misunderstanding.
  (Mr Smith) The absolutely latest figure of May 2002 on the new model is 7.8%, that is correct. But the difference between the two models is not that more people are evading but that more premises are now included in the calculation.

  92. I understand but they were evading previously. I think I have established the point, Chairman, even if Mr Smith does not acknowledge the point I am making, that you were estimating round about 1.3 million of properties were unlicensed through evasion. Now you have got a more accurate estimate, it is 600,000 or 700,000 more properties than previously. That does not mean that there has been a change in the number of criminals or that you are less effective; it simply means that you have a more accurate estimate. There is one thread of questions which I wanted to follow, with which we have struggled with everybody so far, so let us hope we can try to understand each other better. Perhaps I need to brush up my communications skills. You have 3.5 million visits a year. Until just today you were working on 1.4 million properties not paying their licence fees, and now it is 2 million, but even that is substantially less than 3.5 million visits a year. Why are there so many visits when there are only 2 million unlicensed properties, even by today's upgraded estimate? What are all these people doing? Why are we visiting almost every property twice?
  (Mr Smith) Some properties do get visited more than once, no doubt about that.[3]

  93. It is a mathematical fact, is it not, that every single property which is evading has been visited twice, according to these figures? It is a mathematical fact.
  (Mr Smith) I cannot argue with that.

  Jon Trickett: Why—
  (Mr Smith) As I say, because some people do need visiting more than once a year. Do not forget there is household churn of about 9% a year. It is important because people do not write to us and tell us.

  94. You mean they move house?
  (Mr Smith) Yes, or buildings which were not flats are turned into flats and we are not necessary notified of that. The base from which we are calculating the evasion rate gets bigger each year as well.

  95. I still think it is a remarkable fact that there are so many visits relative to the number of properties. Remember you were thinking that there were only 1.4 million unlicensed at the time you were making 3.5 million visits. In management terms, that strikes me as somewhat curious, even though people are moving all the time, and I accept that. Normally you catch people by writing to them when they move.
  (Mr Smith) We do write.

  96. Let us just look at the distribution of the evaders. Not only do we know that if you add stratification, that is reflected to some extent in non-evaders. Also, there is the vast geographical differences between their areas. How do you manage your people who are chasing these evaders? Do we have more evaders per head of population in Scotland or in Northern Ireland?
  (Ms Patel) Because of the security situation in Northern Ireland, we have always had consistently higher evasion, even though we have brought that down over the last ten years. The security situation there makes a difference. In Scotland, we do have a higher proportion of evaders but the prosecution process is different as well there.

  97. I am going to ask you about that in a minute. The question I asked you was: do we have more people per head of population in Scotland chasing evasion than we do in England?
  (Ms Patel) We have more enquiry officers working in Northern Ireland and in Scotland over the last few years because we are trying to tackle evasion in those areas. I do not have that particular statistic to hand. We could pass that to you later.[4]

  98. The answer is yes, but you do not know what the figures are off the top of your head . I do not expect you to know that. I have a final set of questions. Boiling down these 3.5 million visits a year chasing what was estimated to be 1.5 million unlicensed properties, we are told in the paper that 300,000 odd properties were identified; you now say it is 460,000. But only 100,000 odd—it was 50% and it is now quite a lot less than 50%—actually result in prosecutions and of those prosecutions, a substantial number, about a quarter, are not even successful. What is happening in relation to all this, so that I can try to understand whether or not you have actually analysed this and tackled it as a management issue?
  (Mr Smith) To make sure we are clear on the figures, 459,000 people were caught and of those who are caught 72% then end up buying a licence. So we are dealing with the 28% who don't.

  99. Would you say that every single person who does not pay up is then prosecuted?
  (Mr Smith) We will take a prosecution statement immediately for the people who have been caught. If they then buy a licence, we will not go to court. Mostly we are interested in them buying a licence, not to get people into court. If they buy a licence, that is the end of it. For the people who do not buy a licence, we then end up taking them to court and we prosecuted 135,000 people in the year just ended. As I have already said, if they then still do not buy a television licence, we will re-prosecute until they do.

4   Note by witness: Yes. TV Licensing has nearly twice as many enquiry officers per potentially licensable place in Scotland and Northern Ireland, than in England and Wales. Back