Arrangements from 1997
10.1 Oftel is nearing the end of this phase of consultation on the concept of Universal Service in telecommunications. It has defined the level of service which it believes should be available to all and has looked at the extent to which market forces and regulation have achieved that level. The conclusions have been positive.
10.2 Oftel has made a number of specific proposals for improving what is already a high level of universal service provision and is now seeking comments on them before coming forward with specific measures later in 1997.
10.3 Oftel has evaluated the overall net cost of universal service to BT as the current universal service provider, an has concluded that, on the evidence currently available, an overall net cost is not proven, and that there is not a reasonable justification at present for setting up universal service funding arrangements.
10.4 Separately, Oftel will work with DSS on establishing a mechanism for ensuring that the telecommunications industry meets its obligations under the Disability Discrimination Act.
Monitoring and Review
10.5 Oftel intends to monitor the delivery of universal service in the UK. In particular Oftel will look to ensure that data is collected and published on:
10.6 Oftel recognises that the telecoms market is fast moving and that universal service arrangements will need to be kept under review. Oftel therefore intends to carry out a full review in 1999 which would cover:
10.7 This review would feed into both the ongoing review of universal service arrangements at European level and the review of BT s price control arrangements in the UK from 2001. As a result of the review, Oftel would consider what arrangements may be necessary to modify the universal service level and/or share the net costs of providing universal service fairly and proportionately across the industry.
10.8 In reviewing the level of universal service, the following factors would be considered:
10.9 In determining whether or not universal service was incurring an undue financial burden on the provider, Oftel would review the net universal service costs in the light of market conditions and technological developments, and also have regard to overall market shares.
10.10 Oftel believes that the level of universal service described in Chapter 2 is reasonable, fosters overall economic efficiency and is line with the developing EC framework. However, at some future time it might be necessary to make material changes to the universal service arrangements, either as to the level of universal service or to the funding mechanism. In that event, the Director General would wish to confirm that the relevant Secretaries of State were content with any revision of the universal service arrangements.
Consultation responses
10.11 Oftel looks forward to responses to this Consultation Document
and is confident that the results will enable positive and forward
looking changes to be made to the universal service regime later
this year.