MONDAY 1 JULY 2002

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

  100. Can you understand why I am struggling with the numbers because there are substantially more visits than there are unlicensed properties. You are not visiting them not just once a year but two or perhaps three times a year every year. This is not just a one-off process.
  (Mr Smith) It is not necessarily the same houses either.

  101. No, but the figures are not really reducing very substantially either. They are going down but not dramatically down. Of those people we find who have evaded, we are generous, and probably rightly so, enough not to prosecute all those statements taken. Only 100,000 prosecutions are taken; 30,000 or so of those are unsuccessful. Yet there are still 2 million people not paying a licence the following year.
  (Mr Smith) They are potentially different people.

  102. Are they different people?
  (Mr Smith) They can be. That is the point. As I have already mentioned, at least 9% of these people move house and there is about 0.9% household growth, just new houses. With our new model, we are introducing all sorts of premises that previously were not covered. So there is a whole load of new places we are pursuing.

  103. Somehow I feel that this is like one of those reels in a cage where you see a rat which is running round and round. The rat is actually getting something beneficial out of it; it is probably burning off its energy. I am not sure that you are burning off energy in any productive way because we have twice as many visits as are merited by the number of properties, a fraction of those actually in terms of prosecution, but really a steady decline—not a huge decline—and visiting another 3.5 million properties again the following year. I am struggling to think of any other business or commercial operation which is so ineffective in terms of 3.5 million visits to 1.5 million properties resulting in only 100,000 odd successful prosecutions. I do not know whether I judge, at the end of all this questioning, that this is an effectively managed process.
  (Mr Dyke) If you took the position over a decade on the old statistics, evasion has halved while the cost of collection has stayed exactly the same. You could argue the opposite, you could argue that it is a remarkably efficient organisation and the staff have done pretty well. How many students every year leave halls of residence and go into their first flat? None of those has a television licence.

  104. When I was a student, I paid for my licence. The estimate of the continuing reduction has now been upgraded by the same 600,000 properties. What you lose with one hand you lose with the other hand as well. We are going to see the same decline but it will be to a higher base than it was previously because the base is higher now. 600,000 more properties are still going to be uncollected than previously. Is this to be a statistical projection forward of the current trend or is there some scientific management behind this? Are you going to introduce some new system? On what basis have you made this estimate? You are predicting a continuing decline and I got the impression you have simply extrapolated. Some statistician, probably with an `O' level in maths could easily project a continuing decline on the present trend. Is that what you have done?
  (Mr Smith) No, although I will do that and see what it looks like. It is our estimate informed by looking at the tenders that came in for all the people who bid for the contract, informed by a whole range of market research, informed by the calculations that go into the model. It's our estimate of what we think we can get the evasion rate down to, and that is 4%.

  105. I think the BBC is very good value for money. The only grumble I get from my punters is they felt slightly let down by the BBC in so far as when they lost the sports events they said they would rather have paid more on the licence than be forced to pay a lot more for having to use satellite dishes or cable television.
  (Mr Dyke) We have begun to win back some of the sports events that were previously lost. Largely because we decided to divert some of our resources into doing that two years ago.

  106. Value for money, especially on the radio, is unsurpassed. If I were you, I would be very pleased to get the good information out and get Sir John in to audit the books and show what good value you get in this country. When we look at television licences, we have two million properties where they evade licences. One of the first things I did was to check the number of households in the country. We have 24.1 million households as the census of 2001 and we have 23.6 million licences and that is very good but that encompasses business and students. I thought, "There is something wrong here" and I will tell you why. If I was at home and my three children were watching television in the house, in their own room, I would be paying one licence. Is that correct?
  (Mr Dyke) Yes.

  107. They go off to university and take their televisions with them and now I have to pay four licences. Why can I not come to an arrangement to buy a joint licence so they have a copy of my licence that says they are part of a household temporarily using a television away from home? Would this not cut down particularly the number of students and people like that? Is this possible?
  (Mr Dyke) Not within the Act as it exists, no, but if you would like to amend the law I am sure it is possible. Here is one interesting fact I discovered from a person who was writing to me about this. If one of your children took your television set and left you without one, they can use your licence.

  108. If you have two homes and Monday to Thursday you are in London; at weekends you are back at home, you can only watch one television at a time but you would have to buy two licences because it is the receiver and not the person watching it, so you get resistance. Do you have much resistance with regard to people buying two licences for two homes of that nature?
  (Mr Dyke) We get some correspondence about that. I am not sure there is a mass feeling of sympathy in society for them.

  109. There never is but if these people can avoid paying it is not just necessarily the poor that avoid paying the television licence, is it?
  (Mr Dyke) No.

  110. Do you have any statistics as to the ability of the evader to pay the television licence?
  (Mr Smith) It breaks down into socio-economic analysis. A and B socio-economic class evading is about 23% of the total and C1, C2, D and E is about 77%.

  111. You do not categorise it down as a separate category?
  (Mr Smith) The approach of the new contractors is to stratify the data in that degree of detail to work out what anti-evasion measure makes most sense in different types of household.

  112. I would contend that the poorest people in society tend to be the regular weekly payers of their bills and they do not normally fall behind if they can possibly help it.
  (Mr Smith) There is still the licence saving stamp scheme. £174 million-worth of stamps were sold last year.

  113. All these schemes are the same. There is not one government scheme as yet that I am aware of that has worked from day one without falling over because of large numbers. Have you thought about getting a scheme in place where you have more of a regional approach, a local approach, to running your databases?
  (Mr Smith) It needs some degree of coordination because people move house and don't necessarily stay in the same area and the different payment methods are national schemes available across the whole of the UK. You need quite a degree of central coordination. The database itself is best run as a single entity where you have common standards, common policies, common computers and so on. The local anti-evasion activity is best done on a localised basis which is why our contractors have officers around the country rather than all being done in one place.

  114. One of the things we did recently in the last couple of years is, on the road fund licence system, where there were vehicles without a road fund licence, we clamped the car and if they did not pay it we crushed the car. When we did it in one or two parts of London, the local Post Office ran out of forms for the renewal of excise duty. When you go into an area, how many people remember and run down to the Post Office or wherever and start to renew their licence?
  (Ms Patel) The word on the street is that when an inquiry officer is visiting a street we put it in the local paper so people know they are coming and you do get a mass run on the local Post Office. You also get a lot of word of mouth along a street.

  115. Have you ever analysed the blip?
  (Ms Patel) Only on a local level. For example, in Birmingham, when anti-evasion officers were going in to check people watching the World Cup at home, we grew sales in one month by 23%.

  116. I do not know if Birmingham is a good or a bad area but where is the worst area for evasion?
  (Mr Dyke) Belfast. It was not the most popular job being a licence fee collector on the Falls Road.

  117. How many people do pay in Belfast?
  (Mr Dyke) Northern Ireland is now 20% evasion.

  118. 80% pay?
  (Mr Dyke) Yes, which is considerably better than it was five years ago.
  (Mr Smith) It's halved over the same period.
  (Mr Dyke) The peace process clearly helped.

  Mr Jenkins: 80% in that environment is quite good. It is probably the highest payment rate they make anywhere in that area. It is better than other things that they acquire.

   Chairman: It is better than the tax paid on petrol anyway!

  119. They do not pay tax on petrol! Which is the worst area on the mainland?
  (Ms Patel) The highest number of evaders caught are in Glasgow, London, Manchester, Edinburgh and Birmingham, the top five.