Annual Plan 2014/15
Ofcom's Annual Plan sets out our 2014/15 work programme
1.1 This Annual Plan sets out Ofcom's strategic purposes, its priorities and work programme for the 12 months from 1 April 2014 to 31 March 2015.
1.2 Our plan has been further developed following consultation with stakeholders. We have responded in detail to the points raised in Annex 1 of this statement and amended the Draft text where necessary. Alongside the Annual Plan we have also published a table on our website that sets out our programme of work for the forthcoming year.
Our strategic purposes have not changed since 2013/14, although we have re-balanced the focus of our work, as reflected in our 2014/15 priorities
1.3 Ofcom's principal duties are to further the interests of citizens in relation to communications matters and to further the interests of consumers in relevant markets, where appropriate, by promoting competition.
1.4 In post, our primary duty is to secure the provision of a universal postal service. Where we are carrying out our functions in relation to postal services, we are required to give priority to this primary duty if it appears to us that it conflicts with our principal duties.
1.5 In 2013, we defined an overarching strategy, set out below, which we believe best delivers consumer and citizen benefits in the light of these duties.
We will work for consumers and citizens by promoting effective competition, informed choice and the opportunity to participate in a wide range of communications services, including post. We will secure the optimal use of spectrum, through market mechanisms where possible and regulatory action where necessary. We will provide proportionate protection for consumers and help maintain audiences' confidence in broadcast content. We will contribute to public policy defined by Parliament, including high quality public service broadcasting and plurality of media ownership.
To achieve these aims, we will be consultative, transparent and proportionate. We will be informed through high quality research and information, which we will share widely. We will be mindful of the diversity of the UK and its nations. We will aim to be innovative, responsive and effective in everything we do.
1.6 This strategy continues to be relevant. Further details, including the strategic purposes and strategic approaches that support it are found in Ofcom's 2013/14 Annual Plan.
1.7 In addition to this strategy statement, Ofcom's regulatory principles continue to remain relevant in describing our approach to regulation. They include:
- operating with a bias against intervention, but with a willingness to intervene firmly, promptly and effectively where required;
- striving to ensure that our interventions will be evidence-based, proportionate, consistent, accountable and transparent in both deliberation and outcome; and
- seeking the least intrusive regulatory mechanisms to achieve our policy objectives.
1.8 We first developed our strategic purposes in 2011 and reviewed them in 2013 to reflect our strategy and frame our programme of work over the coming years. These purposes remain unchanged for 2014/15.
Figure 1: Strategic purposes
1.9 Ofcom's work programme for 2014/15 is underpinned by these strategic purposes and informed by:
- last year's priorities and our progress in delivering them;
- wider market developments, including the changing consumer use of communications services;
- legislative changes to our duties; and
- areas where Ofcom provides technical and industry expertise and advice to government.
We have delivered a number of our 2013/14 priorities, and have made significant progress with many others
1.10 There are a number of priorities that featured in the Annual Plan 2013/14 which we have already delivered:
- Timely spectrum clearance in the 800MHz and 2.6GHz bands, to enable new awards while mitigating coexistence issues: clearance of the 800MHz and 2.6GHz bands was completed successfully in July, and in October 2013 respectively. This allowed all four MNOs to launch 4G mobile services by the start of 2014 while ensuring no significant detriment to DTT services.
- Work in collaboration with government and industry to promote the widespread availability of superfast broadband: availability of fixed superfast broadband is on track to reach 95% of premises, as a result of both commercial investment and public funding. In mobile, there are positive prospects for 98% indoor coverage as a result of O2's 4G coverage obligation.
- Develop approaches to future content regulation: we have contributed to the government's work in relation to the reform of content regulation through the Communications Review process. This includes areas such as EPG regulation reform, R18 content and approaches to keeping audiences safe online, particularly children. We have also worked with other regulators to establish ParentPort, and have reviewed, and where appropriate amended, the rules relating to audience protection.
- Re-licensing of Channels 3, 4 & 5: revised content obligations for the Channel 3 and Channel 5 licences were set out in July 2013. We have now concluded the re-licensing of these channels, and Channel 4.
1.11 There are several areas where we have made significant progress, but where the final outcome will be delivered beyond 2013/14:
- Effective competition and investment in broadband: our review of the markets for fixed voice and broadband connections and local access will be key to ensuring competition and investment. We published our consultation proposals in July 2013 and our final conclusions are due to be published in mid-2014.
- Develop and implement policies that will improve the ease of switching between communications providers: we have published a policy statement requiring a move to harmonised gaining-provider-led (GPL) switching on the Openreach copper network. We will work towards implementation in 2014/15.
- Potential change of use of the 700MHz band: we are preparing our consultation on a cost-benefit-analysis of a potential change of use of the 700MHz band and associated implementation issues. We will continue to work with government on this issue.
- Release of 2.3GHz and 3.4GHz bands to meet spectrum demand: following the Ministry of Defence's announcement that Ofcom would manage this award, we have progressed with our preparations to consult on the award of this spectrum.
- Secure the provision of the universal postal service: we continue to monitor market developments and Royal Mail's performance, following privatisation, to ensure that our regulatory objectives are met. We have extended regulatory protection to all UK delivery points and we have begun to review the two industry codes of practice.
- Implement reform of non-geographic numbering to ensure price transparency: we have recently published our final statement on non-geographic numbering and will now move ahead to implement the recommendations.
- Protect consumers in a range of priority areas, including silent calls and mid-contract price increases: we continue to identify areas of consumer harm through our monitoring and enforcement programmes, and by using data from our contact centre.
Our work programme for 2014/15
1.12 The work we undertake each year falls into three categories: (i) priorities, (ii) major work areas and (iii) programmatic activity. Each is discussed in turn in the main sections of this document (sections 3, 4, and 5).
1.13 Our priorities for 2014/15 are set out in Figure 2 under their respective strategic purpose.
1.14 We will assess the successful delivery of these priorities against the outcomes we are seeking to secure for citizens and consumers. To do this, we have identified interim and final outcomes for each priority and we will measure our progress towards delivering these outcomes in our 2014/15 Annual Report.
Figure 2: Annual Plan 2014/15 priorities
1.15 In addition to these priorities we have a number of major work areas as set out in Figure 3. These are additional specific areas of work for Ofcom to deliver in the forthcoming year. Details of our major work areas can be found in Section 4 - Major work areas for 2014/15.
Figure 3: Annual plan 2014/15 major work areas
1.16 Alongside our priorities and major work areas, we will also continue to deliver important programmatic services to stakeholders, citizens and consumers as set out in Figure 4. This represents Ofcom's 'business as usual work' that helps deliver our strategic purposes. Details of this programmatic work can be found in Section 5 - Programmatic work and services to stakeholders.
Figure 4: Ofcom's ongoing programmatic work
Our priorities and major work areas for 2014/15 can be summarised into seven themes
1.17 These themes either draw directly on one of the strategic purposes (set out in Figure 1) or are cross-cutting across our strategic purposes:
- promote effective competition and informed choice - this is an important element of Ofcom's strategy to deliver competitive markets, we will deliver by, for example, providing information to people in those service areas that lack transparency;
- secure optimal use of spectrum - as in 2013/14, spectrum issues make up a significant part of our 2014/15 work programme, covering, for example, a programme of potential future spectrum release including 2.3GHz, 3.4GHz and 700MHz bands;
- maintain audience confidence in broadcast content - Ofcom will continue to make an important contribution to the government's priority of improving outcomes for audiences and online consumers. This includes work on child protection online, and contributing to a common media standards framework;
- availability - ensuring the availability of communications services, and in particular fixed and mobile broadband and superfast broadband, continues to be an important part of Ofcom's work programme. A combination of commercial investment, spectrum release, regulatory policy and government intervention is helping to deliver widespread availability of these services. These remain significant areas of activity for Ofcom, mainly in supporting further commercial investment and public sector intervention;
- quality of service - quality of communications services matters as much as availability, and is increasingly important for consumers. In mobile we will conduct work on the provision of consumer information regarding the quality of experience and broadband speeds. We will also continue our work in the area of traffic management and will also continue to monitor the quality of postal services;
- cost and value - we have seen broadly positive outcomes for communications services in this area. Our work will continue to target issues including the affordability of core services and the adoption and use of services by disabled consumers. We published our most recent work on affordability, and more generally on the cost and value of communications services, in the Consumer Experience report in January 2014; and
- adoption - in this area, commercial provision, supported by policy, continues to deliver positive outcomes. Take-up of services continues to rise, with services such as broadband and mobile broadband now enjoying widespread adoption and use by consumers.
1.18 We will also remain responsive to new issues, emerging concerns that affect consumers across the UK, and new government requests. We will focus on those areas where we can make the most difference.
1.19 In addition to responding to requests from the government, and helping it to implement its policies in respect of communications matters, we will aid devolved administrations in the UK nations, to ensure that consumer and citizen benefits are available across and within all the nations of the UK. Details of our work in this area are set out in section 5.
1.20 We have also identified areas of potential future relevance to Ofcom. These include possible future priorities for the organisation, and emerging issues on which Ofcom may be required to have a view in the foreseeable future. Both are areas over which Ofcom will continue to maintain a watching brief, but where it is too early to undertake work in the financial year 2014/15. Details can be found in section 7.
Ofcom budget for 2014/15
1.21 Ofcom has set a budget for 2014/15 at £117m, with no increase on the 2013/14 budget and representing a 2.6% real term reduction. In setting the budget at this level, we will have delivered a 28.6% real term budgetary reduction compared to 2010/11, exceeding our original commitment to deliver total savings of 28.2% by 2014/15.