Layout image
Layout image
Layout image Layout image Layout image Layout image Layout image Layout image Layout image Layout image
Layout image Layout image Layout image Layout image
Draft Oftel Management Plan 2002/3 - 19 December 2001 Layout image
Layout image Layout image Layout image Layout image
Layout image Layout image Layout image Layout image Layout image Layout image
Layout image Layout image Layout image

Contents download as a pdf


Chapter 1 Strategy update

Chapter 2 Strategy development

Chapter 3 Proposed projects and programmes 2002/3

Chapter 4 Oftel's proposed budget 2002/3

Chapter 5 Consultation process and questions

Annex 1 Oftel decisions – monitoring log for 2001

Annex 2 Impact of the EU Directives including Market Reviews

Annex 3 Non-market reviews timetable

Annex 4 Market research plans for 2002/3

  Foreword from the Director General of Telecommunications

This draft Management Plan for 2002/3 updates Oftel’s strategy to meet its objectives. It sets out Oftel's projects, programmes and budget for 2002/3. We are seeking views by 31 January 2002.

The plan is set against a background of change in demand for more sophisticated services such as broadband though basic telephony remains of fundamental importance. There have been major changes over the last year as a result of competition and because of the financial environment. Major change in 2002 will come from the new European framework, and related new UK legislation.

Oftel wants to receive views on its proposed work from all those with a stake in the UK electronic communications market – consumer groups, telecoms operators, service providers, other regulators and Government. We would also welcome views from other European regulatory authorities.

The draft plan includes:

  • lessons drawn from the experience of the past two years;
  • initiatives to promote competitive broadband markets and steps to prepare for OFCOM;
  • work needed to start implementation of the new European Directives in 2002; and
  • the appropriate focus of regulatory resources.

Oftel looks forward to hearing your views. These will be important to ensure that we tackle the important issues over the year ahead.

David Edmonds

Director General of Telecommunications


Chapter 1 Strategy update


1.1 Oftel's aim to obtain the best deal for consumers in quality, choice and value for money is achieved primarily through promoting effectively competitive electronic communications markets. We intervene to protect consumers where competition is insufficiently established or where there are special features of networks that require intervention.

1.2 Our objectives are:

  • effective competition – benefiting consumers;
  • well informed consumers;
  • adequately protected consumers; and
  • prevention of anti-competitive practice.

1.3 Since January 2000, Oftel has adopted a 'competition plus' approach to achieve these objectives.

1.4 The 2002/3 draft plan takes account of experience, and looks ahead to the European framework and OFCOM.

Strategy achievements

1.5 Some telecoms markets are becoming increasingly competitive though effective competition has yet to be achieved in others. The pace of change of technology and consumers’ demands means constant need for investment in new networks and services. Regulatory action needs to be focused on its objectives and should not undermine investment and innovation. We should pursue the minimum regulation necessary to achieve the best deal for the consumer. Additional and existing regulation should be reviewed and justified.

1.6 We do this by:

  • reviews of market segments to assess the degree of effective competition, and what level and type of regulation is appropriate;
  • explicit assessments of the advantages and disadvantages of policy options;
  • performance measures which focus on the extent of effective competition in markets within our scope; and
  • transparent and robust decision making, with high quality evidence.

1.7 Regular market reviews to ensure appropriate regulation is reflected in the EU Framework Directive which will come into force in 2002.

1.8 In terms of performance measurement Oftel has:

  • set service delivery agreement targets, agreed with the Treasury and published in November 2000. These are summarised in table 1 below, and performance against these targets will be published in Oftel's 2001 Annual Report;
  • prepared a monitoring log of key decisions taken (see Appendix 1 for log for April-Nov 2001); and
  • developed international benchmarking of prices paid for baskets of telecoms services in different countries (reports published six-monthly).

Table 1 – Service Delivery agreement targets


Effective competition benefiting consumers objective

Increase the extent to which the market is effectively competitive or effective competition is in prospect

Well informed consumers objective


  • the awareness amongst consumers of the choices available to them
  • the availability of useful information on price and quality comparisons provided by the industry/private sector initiatives
  • the proportion of consumers making well informed choices

Adequately protected consumers objective

All consumers protected by:

  • effective competition or regulation where competition is not effective
  • ensuring access to basic telecoms services at affordable prices on reasonable request

Prevention of anti competitive practice objective

encourage and secure a reduction in significant anti-competitive practice by taking effective action


spending on Oftel will deliver value for money

Lessons learnt

1.9 We have learned:

  • as competition has intensified, and technology has increased opportunities for new services, there has been increased demand for regulatory action. For example, rival operators have requested Oftel to enable access, at regulated prices, to BT's networks. This goes beyond traditional PSTN interconnection to requests for access to, and interconnection with, eg ATM/IP networks as well;
  • increased demand for faster decision making at the same time as demands for 'due process' to be maintained from other players;
  • the difficulty of measuring the effectiveness of competition in different market segments, against a background of rapid change;
  • many stakeholders are opposed to lightening or lifting regulation;
  • self and co-regulation may be complex to implement; and
  • use of Competition Act powers can be expanded to deal with anti-competitive practice.

External developments impacting on strategy

1.10 There have been some major changes in the external environment:

  • large reductions in share prices, lower debt ratings, and market sentiment have reduced availability of funds for investment particularly for newer entrants which has impacted on the development of competition;
  • increasing focus on, and demands for broadband services;
  • a new EU framework will provide the basis of most of Oftel’s regulatory powers and functions from 2002 onwards, working closely with other European regulators on its implementation; and
  • the Communications White Paper set out proposals for new converged regulation and the creation of OFCOM as the converged regulator.

1.11 Oftel’s strategy has been robust in the face of those changes; but we now need to update it. Strategy issues in relation to the new EU framework, broadband and OFCOM are considered in Chapter 2.

Improving the applicability of strategy principles

1.12 Oftel has identified regulatory principles to provide clarity and predictability. There need to be updated (see Table 2 below).

Table 2: Improving applicability of strategy principles

Summary of original principle

Improvement in applicability

(i) minimum regulation necessary

  • need to do an appraisal of options including, as appropriate, cost benefit analysis/regulatory impact assessment (CBA/RIA) on key decisions (tailored to Oftel role)

Effective competition – benefiting consumers

  1. promote sustainable competition

  • ensure consideration of structural as well as behavioural options for promoting competition – where appropriate
  • be aware of and address pressures for more regulation even where there is more competition
  1. cease to promote where effective competition
  • tailor review and monitoring process and frequency to market circumstances within EU guidelines

Well informed consumers

(iv) Encourage consumer awareness and

  1. industry to meet consumer needs


  • Encourage codes of practice to enable reliance on standard consumer legislation
  • Encourage 3rd party providers of information through appropriate use and endorsement of accreditation schemes

Adequately protected consumers

  1. Minimise distortion from intervention

  • use non-market review guidelines* to ensure consistent, relevant approach
  1. Control prices only where competition not effective
  • Link price control to state of competition more explicitly
  1. Don't let intervention undermine incentives to innovate
  • monitor effect of intervention on innovation and extent of consumer detriment (using a standard methodology* for assessing consumer detriment where appropriate
  • ensure forthcoming Access and Interconnection guidelines address this issue
  1. Encourage self/co regulation
  • focus on areas where sufficient common interest (typically consumer information and protection) and look at different ways of pursuing co-regulation appropriate to circumstances, sometimes in conjunction with formal regulation

Prevention of anti competitive practice

  1. Rely on competition legislation

  • use competition legislation wherever possible for tackling anti-competitive behaviour

*due to be published January-March 2002 (see below).

Improving strategy implementation processes

1.13 Three key processes also need to be updated. These are set out in below.

1.14 First, in assessing policy options, Oftel will have an approach that meets Government's Regulatory Impact Assessment (RIA) and consumer groups' Customer Impact Assessment (CIA) requirements while recognising that we are an independent sectoral regulator with EU Directive requirements, and specific statutory duties.

1.15 Second, market analyses (incorporating existing effective competition review) will:

  • incorporate lessons learnt
  • meet the requirements of new EU legislation
  • reconcile competition cases and market analyses timetables.

1.16 Third, Oftel will develop a non-market reviews (NMRs) methodology to

  • better identify consumer interest criteria which can trigger regulatory involvement, and the principles which should shape proportionate intervention. These will include areas such as USO, data protection, ombudsman scheme, numbering. (see appendix 3)


Chapter 2

Strategy development


2.1 Oftel's needs to ensure its direction is clear when addressing new challenges. Key among these will be:

  • aligning Oftel's strategy with EU Directives;
  • broadband regulatory strategy; and
  • looking ahead to OFCOM.

Aligning Oftel's strategy with new EU Directives

2.2 The strategy needs to align with the framework in the five new EU Directives on regulation of electronic communications (Framework, Access and Interconnection, Authorisation, Universal Service and Communications Data Protection Directives) (see Appendix 2).

2.3 The Directives take effect early in 2002 and there is 15 months in which to transpose the directives into national law. Oftel will work with other regulators and the Commission to ensure consistency. There will be changes needed in our internal processes. Market analyses will be obligatory before regulatory rules are imposed under the new Directives, and our programme of analyses begins in 2002/3.

2.4 There are two related projects in relation to the EU Directives: to oversee the implementation programme of work; and to co-ordinate the market analyses.

2.5 The Framework Directive sets three objectives for regulatory authorities:

  • promoting competition in networks and services;
  • contributing to the development of the internal market; and
  • promoting the interests of European Citizens.

2.6 For 2002/3, these objectives will be our guiding objectives, with the existing objectives being used at the operational level.

Table 3 – Alignment of Oftel objectives with overall EU objectives

Overall high level
EU objectives

Lower level
Oftel operational

1. Promoting competition in networks and services

2. Contribute to the development of the internal market

3. Promoting the interests of European citizens

A. Effective competition benefiting consumers



B. Well informed consumers




C. Adequate protection of consumers



D. Prevention of anti competitive practice



2.7 Oftel currently supports the internal market by, for example, tackling barriers to entry. We will work most closely with NRAs and the Commission to ensure consistent application.

Broadband regulatory strategy

2.8 Our strategy needs to be able to provide a coherent basis for new areas of work. A key issue remains appropriate regulation of broadband networks and services to meet emerging consumer demands, and a number of Oftel's

projects and programmes for 2002/3 will relate to this as described in chapter 3. A fuller description of Oftel’s regulatory strategy for broadband can be found on Oftel’s website.

2.9 Oftel’s aim is to enable consumers’ demands for broadband to be met. Large businesses, SMEs and residential consumers all have different needs. Different supply routes and technologies are likely to be needed. Regulation sets the framework. The outcomes will be determined by the actions of commercial firms meeting the demands of their customers.

2.10 Our focus is to meet demands through effective competition at all levels in the provision of broadband services: in infrastructure (ie in access, the middle mile and backbone networks) and in services provided over networks.

2.11 It is vital in developing markets which require large investment that effective competition is promoted through appropriate regulation ie the minimum regulation required to deliver outputs. We must balance incentives to invest and innovate with prevention of excessive pricing.

2.12 For broadband, we will use the generic rules to assess the case for appropriate regulatory action:

  1. appropriate market definition in accordance with competition law. Market definitions need to be consistent across all cases dealing with broadband, and reviewed from time to time in the light of market developments;
  2. market power – analysing who has market power in the defined market(s), and only taking formal regulatory action if the operator has market power. Again, regular reviews are necessary;
  3. regulation should only be applied to the extent necessary to deliver effective competition; and
  4. appropriate terms and conditions – regulation should be proportionate to the problem identified so that terms and conditions, including wholesale prices, are set to encourage sustainable competition.

2.13 Oftel has:

  • intervened to impose appropriate terms and conditions in areas such as local loop unbundling, wholesale DSL and partial private circuits where market power exists with the extent of regulation imposed tailored to the state of the market; and
  • not intervened in other areas such as cable modems, 3G, broadband fixed wireless access where operators do not have market power.

2.14 The future course of consumer demand for broadband is unclear. Technologies to deliver broadband services are still developing. The future development of the broadband market(s) is uncertain. In such circumstances the regulator needs to be especially sensitive to the impact of intervention on market developments and investment. Our strategy provides a framework to ensure that the impact of regulatory decisions is taken fully into account. This applies equally to our work to prevent anti-competitive behaviour. This will ensure a coherent and predictable approach to regulatory action.

2.15 Oftel will also work with Government departments, to help increase consumer awareness of broadband services. We will work with the Small Business Task Force to provide information; publish bi-monthly briefings on availability and take-up of broadband.

2.16 The regulatory framework should be coherent and predictable. We will continue to monitor availability of broadband services. We will contribute delivering the recommendations of the Broadband Stakeholders Group.

2.17 We will support this work with an extensive programme of data gathering and market analysis.

Looking ahead to OFCOM: key policy issues

2.18 In 2002/3 we will contribute to developing thinking for OFCOM. The combined regulator will enable ‘joined up’ decision making. For example in spectrum trading or in the issue of access to networks for service providers, in particular the interaction between competitive converging markets and requirements for specific types of content to be available to all.

2.19 We shall develop ever closer joint working with our fellow regulators to help develop a consistent, consumer-focused basis for regulation under OFCOM.


Chapter 3

Proposed projects and programmes for 2002/03


3.1 The projects and programmes for 2002/03 are described in this chapter. Table 4 lists the projects and programmes by quarter (beginning April-June).

3.2 Any organisation or consumer who wants to discuss a project or programmes should contact the named project or programme manager directly. This applies to

  • suggestions as to the appropriate evidence base including market research;
  • discussions of policy options; and
  • suggestions on ways of conducting the project.

3.3 There are several projects looking at Broadband issues. The relevant projects have been identified below. They are:

  • broadband regulatory strategy (A2);
  • Partial Private Circuits (A7);
  • access to broadband services (A9);
  • wholesale market for umetered Internet access (via FRIACO) (A10); and
  • Internet and e-commerce (A15).

Stages of work

3.4 The planned work against objectives and type of activity reflects our focus in each subject area in 200/03. Projects and programmes will contain elements that relate to other objectives and activities.

3.5 Projects are likely to have the sequence of review – implementation – monitoring. The timescale will depend on the scale and complexity of the issue.

3.6 Oftel is committed to monitoring and evaluating its policies to see whether they are achieving the policy objective initially set. This will be on the basis of both pro-active monitoring and response to specific complaints.

3.7 The review cycle for market segments fits with this approach, and the timetable for specific reviews is being revised as part of the work in implementing the new EU framework .

3.8 Where a review, concludes no specific regulatory intervention is necessary, then the cycle of review – implementation – monitoring will end.

Stakeholder involvement

3.9 The scope for stakeholder involvement will vary by subject area. Stakeholders can participate by providing evidence of competition, and comment on which forms of regulatory intervention may be appropriate. For implementation activities, stakeholders may comment on operational details of how a policy is to work in practice. For monitoring activities, stakeholders may be involved eg as an end user in assessing comparative information produced by telcos. For all three stages of review, implementation and monitoring, Oftel will continue to ensure that progress towards the deadlines and outcomes set is maintained at an acceptable pace.

3.10 For the projects and programmes set out in Table 4 below, stakeholders are invited in to indicate where they would like to be involved.

Advisory Committees on Telecommunications and consumer experts

3.11 The Telecommunications Act 1984 establishes a number of committees (the ACTs) to give advice to the Director General, to represent the interests of consumers, and to give emphasis to especially those with least power. The Acts feed in suggestions to Oftel project managers to help Oftel focus on consumer concerns.

3.12 The ACTs respond to Oftel consultations, hold public meetings, meet the Director General and his senior staff, host seminars, participate in Oftel/industry working groups, liaise with other consumer organisations, and publish their views via an independent web site ( They are supported by secretariats in Cardiff, Belfast and Edinburgh, and a small unit within Oftel (see project C8).

3.13 The ACTs are independent of Oftel. Their annual objectives and work plans are therefore not incorporated in Oftel’s Management Plan but are consulted on and published separately. For information please contact the ACT Secretariat on:

e-mail: tel: 020 7634 5301.

Table 4: Proposed projects and programmes for 2002/03 – summary table

EU objectives: 1. Promoting competition, 2. Contribute to internal market development, 3. Promoting interests of citizens

EU objectives 1, 2 and 3 drive lower level Oftel operational objectives as follows:

1, 2

1, 2

2, 3

1, 2

1, 2, 3

A. Effective competition

B. Well informed consumers

C. Adequately protected consumers

D. Prevention of anti competitive practice*

E. Overall framework of regulation


A1) EU Market reviews programme A2) Broadband regulatory strategy A3) Competition in mobile markets A4) Access to radio spectrum A5) Competition in broadcasting markets A6) Licence condition review programme A7) Partial Private Circuits



C1) Retail price control C2) Consumer codes of practice C3) Mobile termination charges


D1) Developments in Competition Policy D2) Financial Information Systems


E1) Communications Bill E2) General Conditions of Entitlement E3) Research into consumer views E4) Industry data collection


A8) Numbering programme A9) Access to broadband services A10) Wholesale market for unmetered Internet access (via FRIACO) A11) Directory Inquiries Implementation A12) Carrier pre-selection


B1) Raising customer awareness B2) Informing consumers and their advisers   B3) Comparable Performance Indicators


  C4) Universal service obligation C5) Consumer representations C6) Metering and billing approval scheme C7) Essential Requirements C8) Supporting the Advisory Committees on Telecoms C9) Telecoms Ombudsman scheme


D3 Compliance Casework D4) International Controls D5) Interconnection D6) Retail pricing issues    


E5) Developing international relations E6) Stakeholder relationships E7) Implementation of the new EU Directives E8) Oftel Strategy implementation E9) Preparing for OFCOM E10) Better information on companies and markets E11) Telecommunications Code & licensing E12) Regulation and corporate structure


A13) Number portability A14) Network interoperability A15) Internet and e-Commerce


B4) Tariff transparency


C10) Input to other consumer protection legislation C11) Data protection in telecoms C12) Calling line identification


D7) Competition Act Strategy D8) Compliance Monitoring Unit D9) Compliance casework quality assurance


Business support

F1) Human resources

F2) Learning and development programme

F3) Budget management programme

F4) Knowledge management (internal communications)

F5) Electronic records management system

F6) IS and IT

F7) Communicating Oftel's work to external audiences

F8) Research and information

List of proposed projects and programmes for 2002/03

Effective competition – benefiting consumers


A1 EU market review programme Please see amendment below

Programme Manager:

Elaine Axby (tel: 020 7634 8915, e-mail:

Project Manager (strategy and markets):

Nic Green (tel: 020 7634 8891, e-mail:

Project Managers for each individual review to be determined – see also E7

Objective: To ensure that Oftel plays its full part, achieves the right competitive environment for the development of broadband services; and to ensure that the effective competition reviews required by new EU Directives are carried to meet Oftel’s objectives and timetable.

  • Finalise and publish Oftel’s market analysis review guidelines, once final EU Commission guidelines are available (Q1); and
  • monitor and co-ordinate the markets to be reviewed against a prioritised list (Q1 to Q4)

Please note amendment 30 Jan 2002

Objective: To ensure that the effective competition reviews required when new EU Directives come into force are carried out in a timely and efficient manner. Provide on-going assistance to project managers to ensure that Oftel strategy is applied consistently across reviews and that individual reviews are carried out in an efficient manner, identifying synergies across reviews as appropriate

· work with project managers to identify resources and develop realistic workplans for the reviews
· ensure individual project managers are fully briefed on the approach and strategy
· track progress on individual reviews and work with project managers to resolve resource conflicts and gain benefit from synergies across projects
· work with project managers both formally and informally to ensure that strategy is applied consistently.

A2 Broadband regulatory strategy (see also projects A7, A9, A10, A15)

Programme Director: Jim Niblett (tel: 020 7634 8780 e-mail:

Programme Manager:

Ilsa Godlovitch (tel: 020 7634 8721, e-mail:

Other contacts:

Trevor Wood (tel: 020 7634 8854, e-mail:

Neil Buckley (tel:020 7634, e-mail:

Objective: to develop and communicate Oftel’s strategy for the promotion of competition in broadband access and services; and to ensure a joined-up approach across Oftel to broadband investigations and policy development.

  • Ensure implementation of relevant recommendations from Broadband Stakeholder Group (Q1-Q3);
  • monitor market and regulatory developments in the UK and elsewhere and assess their regulatory and compliance implications (Q1-Q4); and
  • maintain contact with relevant devolved administrations and government departments in relation to their plans for roll-out of Internet access (Q1- Q4).

A3 Competition in mobile markets

Programme Manager:

Elaine Axby (tel: 020 7634 8915, e-mail:

Other contacts: TBA

Objective: To ensure effective progress towards the development of competition in mobile markets.

  • Continue implementation of measures emerging from Oftel’s review of mobile market published in September 2001;
  • monitor market developments, including pricing and profitability and the development of third party access to networks for new services on 2G and 3G networks;
  • continue to work with stakeholders to improve quality of information available to consumers and to reduce barriers to switching; and
  • review mobile market competitiveness, including calls to mobile phones in line with new EU Directives.

A4 Access to the radio spectrum

Project Manager:

Roberto Ercole (tel: 020 7634 8905, e-mail:

Other contact: Helen Hicks (tel: 020 7634 5316, e-mail:

Objective: To work with the Radiocommunications Agency (RA) and the Department of Trade and Industry (DTI) policies to ensure that spectrum allocation policy and spectrum pricing promotes the efficient use of the radio spectrum; and to ensure spectrum is used to promote competition in the telecommunications market.

  • Contribute to wider debate on the future of sprectrum management in the UK, in particular in relation to Government decisions in relation to the Cave Review of Spectrum policy, implementation of those decisions and the development of spectrum policy and legislation through the Communications Bill;
  • participate with RA in consultation over the use of 40 GHz for potential broadband wireless services; and
  • contribute to RA consultation and implementation on spectrum trading in the UK.

A5 Competition in broadcasting markets

Project Manager:

Ian Moss (tel: 020 7634 8861, e-mail:

Other contacts:

Jim Niblett (tel: 020 7634 8780, e-mail:

Robert MacDougall (tel: 020 7634 8726 e-mail:, Anil Patel (tel: 020 7634 8928, e-mail

Objective: To develop a policy framework for the promotion of competition in broadcasting markets and to promote understanding of Oftel’s regulatory role eg in regard to conditional access and access control, Electronic Programme Guides (EPGs) and terrestrial transmission. This project will have close links with the ITC and the OFT on the areas of overlapping responsibilities.

  • Take necessary implementation and/or monitoring action in the light of the conclusions Oftel reaches in relation to its current review of conditional access charging regime, due to report by March 2002 (Q1-4);
  • conduct a market review into Access Control (Q2 to Q4); and
  • conduct a review of price controls in Terrestrial Transmission for NTL (Q1 to Q4).

A6 Licence review programme

Project Manager:

Michael Richardson (tel:020 7634 8916, e-mail

Other contacts:

Alan Bell (tel: 020 7634 8931, e-mail:

John Kemp (tel: 020 7634 8855, e-mail:

Objective: To maintain an overview of the need for, and effectiveness of, licence conditions and other regulatory obligations. While the focus is directed mainly at BT’s obligations, the project may also have implications for the regulation of other operators of fixed networks.

  • Co-ordinate the planning and conduct of specific market reviews, including reviews of services which BT is obliged to provide under condition 43 of its licence, to ensure that best use is made of available resources;
  • ensure that Oftel reviews the continued need for Orders and Directions and develops processes for reviewing the appropriateness of any further orders;
  • review the scope for removing inappropriate regulation during the period leading to the replacement of existing licence conditions by general authorisations; and
  • co-ordinate the receipt of deregulatory requests from BT and, potentially, other operators of fixed networks.

A 7 Partial Private Circuits

Project Manager: Maeve Gallagher: tel 020 7634 8777, e-mail

Other contact:

David Black (tel: 020 7634 8822, e-mail:

Objective: To protect business consumers where there is a lack of effective competition in a key segment of the leased lines market.

  • Consider position after responses to current consultation (Q1);
  • address issues arising from direction(s) (Q1); and
  • take the appropriate action through issuing a statement. (Q2)

(see also projects A2, A9, A10, A15).


A8 Numbering programme

Programme Manager:

Ray Thornton (tel: 020 7634 8704, e-mail:

Project Managers:

Numbering allocations:

Nicholas Good (tel: 020 7634 5333, e-mail:

Numbering administration:

Alan Pridmore (tel: 020 7634 8910, e-mail:

Premium rate services:

Warwick Izzard (tel: 020 7634 8981, e-mail

Objective: To enable consumers to benefit from competition and new services by ensuring the provision of adequate numbers and numbering ranges. To promote customer choice in numbers through pre-allocation portability and other methods and the introduction of individual number allocations. To promote the efficient management of numbers by operators through number charging to allocate numbers to telecom companies within 28 days in accordance with agreed policy (Q1-Q4).

  • Implementation of web-based approach to processing numbering applications;
  • complete review of corporate numbering with the aim of determining demand for corporate numbers; (Q1-Q2);
  • input on to industry work on Pre-Allocation Portability and/or to legislative changes for introducing number charging (Q1-Q4);
  • appraise possible implementation methods for charging, including those for developing a selection process for identifying coveted numbers and for auctioning highly coveted numbers (Q1-Q4);
  • maintaining and developing industry and consumer input into numbering policy via the Numbering Forum and other mechanisms (Q1-Q4);
  • to monitor developments in PRS market in particular Higher Rate PRS and Pay-for-Product, monitor any trial re-introduction of Chatlines (Q1-Q4).

A9 Access to broadband services (including local loop unbundling)

(see also projects A2, A7, A10 & A15)

Programme Manager:

Jim Niblett: (tel: 020 7634 8780, e-mail:

Other contacts:

LLU: Trevor Wood (tel: 020 7634 8850, e-mail:

LLU: John Russell (tel: 020 7634 8830, e-mail:

ADSL: Alistair Bridge (tel: 020 7634 8782, e-mail:

ADSL: Naaz Rashid (tel: 020 7634 8849, e-mail:

Objective: Ensure a coherent regulatory approach to the achievement of effective competition in broadband services. To ensure local loop unbundling (LLU) is implemented in accordance with the EC Regulation on LLU and BT’s licence. To ensure BT rolls out its own Digital Subscriber Line (DSL) products in accordance with its legal obligations.

  • To monitor BT’s own ADSL rollout to ensure BT is fully compliant with its legal obligations (Q1 and Q4);
  • to ensure that BT’s Operational Support System is used efficiently to order all LLU services (Q1); and
  • to consider the prospects for effective competition in very high bandwidth services and formulate appropriate regulatory solutions. (Q2)

A10 Wholesale market for unmetered Internet access – Flat Rate Internet Access Call Origination (FRIACO)

(see also projects A2, A7, A9 & A15)

Project Manager:

John Kemp (tel: 020 7634 8885, e-mail:

Other contacts:

Brian Malone (tel: 020 7634 8925, e-mail:

Geoff Brighton (tel: 020 7634 5349, e-mail:

Justin Moore (tel: 020 7634 8859, e-mail:

Objective: To ensure that BT complies with Oftel’s Directions in relation to FRIACO at BT’s local and regional exchanges, and to ensure that future arrangements for Internet traffic are robust and avoid congestion problems, including by facilitating progress on Internet Protocol (IP) interconnection for calls to Internet services. Key aspects:

  • Oftel to ensure arrangements are developed so BT can supply FRIACO to other operators without requiring rearrangement of other operators' traffic using enforcement action if necessary including resolution of pricing, ordering, delivery, ‘stranded assets’ and ‘overflow’ issues (Q1-Q3); and
  • IP interconnection – Oftel to facilitate agreement for IP interconnection between operators and BT (on a formal basis if necessary) (Q1-Q2).

A11 Directory enquiries implementation

Project Manager:

Caroline Wallace (tel: 020 7634 8917, e-mail:

Other contact:

Alex Campbell (tel: 020 7634 8970, e-mail:

Objective: To assist the Industry in the implementation of the new arrangements for Directory Enquiries as set out in Oftel’s September 2001 Statement.

  • To ensure that the Working Group addresses and resolves key issues relating to the new DQ arrangements (eg timetable for implementation, billing arrangements, number allocation processes, informing consumers) (Q1-Q4);
  • where necessary and possible, to use Oftel’s powers to resolve any outstanding issues (Q1-Q4);
  • to ensure that Oftel issues DQ numbers in accordance with the agreed processes (Q1-Q2); and
  • to ensure successful launch of new DQ arrangements within industry-agreed time scales (Q4)

A12 Carrier pre-selection (CPS)

Project Manager:

Caroline Wallace (tel: 020 7634 8917 e-mail:

Other contact:

Alex Campbell (tel: 020 7634 8970, e-mail:

Objective: To ensure that policy and compliance issues arising from the implementation of permanent CPS are resolved.

  • To facilitate Industry agreement and implementation of improvements to inter-operator CPS processes (Q1-Q4);
  • review charges previously determined if necessary, in the light of process changes, industry data or changes in market conditions (Q1-Q4);
  • resolve (through Compliance Directorate) consumer and operator disputes arising from permanent CPS (Q1-Q4); and
  • to ensure the views of consumer representatives are taken into account within the CPS Industry Groups (Q1-Q4).


A13 Number portability

Project Manager:

Warwick Izzard (tel: 020 7634 8981, e-mail

Other contact:

Steve Burniston (tel: 020 7634 5361, e-mail

Objective: To promote effective and sustainable competition in the fixed and mobile markets by ensuring that customers can retain their number(s) (if they wish to do so) when switching between providers of fixed or mobile services.

  • Monitor consumer experiences of number portability through periodic research. (Q1- Q4) – results published twice yearly as part of quarterly market research programme;
  • to monitor technical developments in the routing of calls to ported numbers and consider related matters such as economic signals (Q1-Q4); and
  • develop/implement European legislation concerning number portability within the context of the Communications Bill (Q1-Q4).

A14 Network interoperability programme

Project Manager:

Bill Hawkins(tel: 020 7634 8807, e-mail:
Other contact:

Roy Davies (tel: 020 7634 8906, e-mail:

Objective: To ensure that interoperability is effectively managed at network and customer interfaces, on the basis of co-regulation with the industry through the Network Interoperability Consultative Committee (NICC). To support the harmonisation of UK interface and interconnection standards. To support the work of various focus groups including the Operators Policy Forum.

  • To provide support and regulatory advice to the industry to ensure the satisfactory resolution of interoperability issues (Q1-Q4);
  • to hold quarterly meetings with the NICC and to ensure that their work programme outputs are consistent with Oftel’s policy framework and strategy (Q1-Q4); and
  • to support on request from other Government departments the Government Telephone Priority Service initiative which ensures priority is given to the emergency services in case of network problems (Q1-Q4).

A15 Internet and e-commerce

(see also projects A2, A7, A9, A10)

Programme Manager:

Elaine Axby (tel: 020 7634 8915, e-mail:

Project Managers:

Lucy Rhodes (tel: 020 7634 8836, e-mail:

Justin Moore (tel: 020 7634 8859, e-mail:

Objective: To ensure that the UK regulatory framework is appropriate to encourage the development of the Internet, thereby helping the UK become a world leader in e-commerce.

  • Continue to monitor developments in Internet and e-commerce adoption and usage to ensure that the regulatory regime remains appropriate (Q1-Q4);
  • contribute as appropriate to the development and implementation of Government’s Internet and e-commerce strategy and to action by national, regional and local authorities in relation to Internet access (Q1-Q4);
  • review emerging services such as enhanced multi-media services, messaging and voice over IP to assess their impact on the market and whether they necessitate any changes to the regulatory regime (Q1); and
  • assess the need for improved consumer information on access to the Internet and e-commerce and propose self and co-regulatory actions as appropriate (Q1).

Well informed consumers


B1 Raising Consumer Awareness

Programme Manager:

Chris Rowsell (tel: 020 7634 8890, e-mail:

Other contacts:

Chris Smithers (tel: 020 7634 8876, e-mail:

Objective: To co-ordinate and optimise Oftel’s work in areas of consumer information including direct Oftel outputs and the encouragement of information from other sources.

  • To monitor the impact of existing consumer information initiatives to ensure that consumer demands for information are being met (Q1);
  • to identify the information consumers need by researching their awareness of their rights and opportunities (Q3-4);
  • to co-ordinate and optimise existing consumer information outputs to ensure their maximum effectiveness. To encourage the production – by Oftel or the industry – of consumer information if research identifies demand (Q1-4); and
  • to continue media initiatives to raise consumers’ awareness of rights and opportunities (Q1-4).

B2 Informing consumers and their advisers

Project Manager:

Ritu Manhas (tel: 020 7634 5309, e-mail:

Other contacts:

Chris Smithers (tel: 020 7634 8876, e-mail:

Objective: To improve the handling of consumer complaints and inquiries by providing consumers and advisory bodies such as Citizens Advice Bureaux, Trading Standards offices and charity organisations with accurate, timely information.

  • Continue to feed into the DTI initiative on Consumer Support Networks;
  • ensure relevance and timely updating of Oftel’s consumer guides, and continue to identify telecoms issues where new consumer guides would be useful (Q1); and
  • monitor accreditation scheme for websites providing tariff information for residential consumers (Q1).

B3 Comparable Performance Indicators (CPIs)

Programme Manager:

Chris Rowsell (tel: 020 7634 8890, e-mail:

Other contacts:

Chris Smithers (tel: 020 7634 8876, e-mail:

Objective: To help customers to make well-informed buying decisions by ensuring the availability of information on the quality of service of fixed and mobile telephony companies. To improve the availability, visibility and accessibility of this information by working with the industry and consumer groups on a self-regulatory basis.

  • To support the industry in its assessment of customer demands for information and its presentation. To encourage the establishment of an interactive website for the fixed CPI initiative. (Q1-2);
  • encourage the regular publication of comparable mobile quality of service surveys. Encourage the expansion of these surveys to cover issues such as mobile text messages and customer service (Q1 and Q3); and
  • to increase customers’ awareness of both the fixed and mobile quality of service information (Q1 and Q3).


B4 Tariff Transparency

Programme Manager:

Chris Rowsell (tel: 020 7634 8890, e-mail:

Other contacts:

Chris Smithers (tel: 020 7634 8876, e-mail:

Objective: To ensure customers have access to clear information on tariffs via a range of services, such as price comparison websites. To ensure that providers of price comparison services are able to access the necessary information.

  • To raise awareness of the availability of price comparison services and increase consumer confidence in such services (Q1-4);
  • encourage the development by commercial third parties of telecoms price comparison services by encouraging access to the relevant tariff information (Q1-4); and
  • to review the future requirements for itemised billing in the light of developments such as unmetered services and to produce guidelines for the industry (Q1).

Adequately protected consumers


C1 Retail price control

Project Manager:

Peter Culham (tel: 020 7634 8935, e-mail:

Other contact:

Alan Pridmore (tel: 020 7634 8910, e-mail:

Objective: To protect consumers where competition is not yet effective or in prospect through the implementation, where appropriate, of revised price controls for retail services from 2003, ensuring consistency with outcomes of the price control market review.

  • Publish Statement setting out conclusions (Q1);
  • make licence modifications if appropriate (Q2); and
  • ensure implementation of other policy conclusions from Statement as appropriate (Q2-3).

C2 Consumer Codes of Practice

Programme Manager:

Chris Rowsell (tel: 020 7634 8890, e-mail:

Other contacts:

Chris Smithers (tel: 020 7634 8876, e-mail:

Objective: To ensure the production of consumer codes of practice on service delivery issues in line with the government’s proposals in the White Paper on Communications.

  • Through discussion with consumer groups and the industry to establish the areas in which codes of practice are needed. (Q1);
  • to facilitate the production of the codes on a self- or co-regulatory basis by encouraging industry and consumer working groups. (Q1-3); and
  • to establish a procedure for approving the codes and monitoring their implementation (Q4).

C3 Mobile termination charges

Project Manager:

Vince Affleck (tel:020 7634 8819, e-mail:

Other contact

Selena Bevis (tel:020 7634 8844, e-mail:

Objective : To protect consumers through the implementation of regulatory controls on the charges for terminating calls on mobile networks.

  • To place the necessary evidence before the Competition Commission in relation to the inquiry referred by Oftel into mobile termination charges (Q1);
  • to implement the findings of the Competition Commission as appropriate (Q2 and ongoing); and
  • to ensure compliance with obligations which are imposed for mobile termination charges (Q1-4).


C4 Universal service obligation (USO)

Project Manager:

Alan Pridmore (tel: 020 7634 8910, e-mail:

Other contact:

Rosalind Stevens-Strohmann (tel: 020 7634 8743, e-mail:

Public payphones:

Nigel Humberston (tel: 020 7634 8824, e-mail:

Objective: To ensure all consumers have access to those telecoms services which are: used by the majority and which are essential to full social and economic inclusion; made available to everybody upon reasonable request in an appropriate fashion and at an affordable price.

  • Monitor effectiveness of BT's USO Schemes especially monitoring the impact of In contact Plus and ensuring BT take any necessary action to ensure its success (Q 1-4);
  • review costs/benefits as appropriate in the light of conclusions from Retail Market Review (Q2-4);
  • review, and consult on as appropriate, USO policy in the light of European Directive on Universal Service and User Rights (Q1-3);
  • public payphones: to implement the proposals in the consultation following publication of the Statement and monitor public payphone operator compliance with the Disability Regulations (Q1-Q4); and
  • to commission further consumer research into patterns of payphone usage (Q2-Q3).

C5 Consumer Representations

Project Manager:

Bernice Head (tel: 020 7634 8710, e-mail:

Other contacts:

Alistair Cox (tel: 020 7634 8733, e-mail:

Michelle Champion (tel: 020 7634 8712, e-mail: michelle.champion@oftel


Objective: To deal effectively with consumer complaints and to encourage the industry to deal satisfactorily with consumer complaints in the first instance.

  • Encourage the removal by telecoms companies of the root causes of frequently experienced consumer problems (Q1-Q4);
  • to develop the Oftel Internet site to give information useful to consumers to allow them to be more effective purchasers. Ensure that frequently asked questions are fully updated so the site can be promoted as the first step for complaints. (Q1-Q4);
  • publish summaries of complaints received every six months (Q1 and Q3); and
  • conduct a consumer satisfaction survey on the handling of complaints (Q3).

C6 Metering and billing approval scheme

Project Manager:

Bill Hawkins (tel: 020 7634 8807, e-mail:
Other contact:

Roy Davies (tel: 020 7634 8906, e-mail:

Objective: To enhance consumer confidence in the accuracy of telephone bills and to give wider consumer protection by an effective Oftel Metering and Billing Systems Approval Scheme. This scheme has been extended to all significant operators, made available to major service providers and broadened in scope to include all material elements of bills as appropriate.

  • Systematically roll out the scheme to operators and service providers (Q1-Q4);
  • monitor the work of the appointed Approval Bodies, establish Approval Body Forum and hold quarterly meetings to review and moderate activities (Q1-Q4);
  • publish scheme information as required (Q1-Q4); and
  • hold an annual Forum for all parties to review experience (Q4).

C7 Essential requirements

Project Manager:

Caroline Wallace (tel: 020 7634 8917, e-mail:

Other contact:

Keith Bowman (tel: 020 7634 5348, e-mail:

Objective: To strengthen the Director General’s ability to meet his obligations in respect of continuation of supply by completing the publication of (a) guidelines on network security and integrity and (b) criteria for restriction of access to the network on the basis of network security and integrity.

  • To consider comments received in response to Oftel’s 2001 Consultation on Guidelines on the Essential Requirements for Network Security and Integrity, and on Criteria for Restriction of Access to the Network (Q1); and
  • to publish a statement on Oftel’s conclusions in the light of the above consultation, and to thereby formally adopt Guidelines on the Essential Requirements for Network Security and Integrity and Criteria for Restriction of Access to the Network (Q1).

C8 Supporting the Advisory Committees on Telecommunications

Project Manager:

Terry Walker (tel:020 7634 8774, e-mail:

Other contacts:

David Edwards: (tel:020 7634 8773,

Flora Pieris: (tel:020 7634 5301, e-mail:

Objective: To assist the Director General in his duty to promote the consumer interest, by ensuring that the Advisory Committees on Telecommunications (ACTs) are able to provide him with informed advice in accordance with their statutory duty.

  • Ensure efficient administrative support for the committees, co-ordination of work programmes, and effective communications between the committees and Oftel (Q1-Q4);
  • ensure the committees give high quality advice to Oftel by providing them with effective advice, briefings, and training (Q1-Q4);
  • ensure the committees' advice reflects consumer interests by commissioning consumer research, managing the ACT web site and publications, and ensuring the committees consult and liaise with other consumer organisations (Q1-Q4); and
  • provide the Director General with annual reports on ACTs' activities (Q4).

C9 Implementation of Independent Telecommunications Ombudsman Scheme

Project Manager:

Rosalind Stevens-Strohmann (tel: 020 7634 8743, e-mail:

Other contacts:

Chris Rowsell (tel: 020 7634 8890, e-mail:;

Chris Handley (tel: 020 7634 8863, e-mail

Objective: To ensure that the UK complies with obligations under the RVTD and future European legislation on dispute resolution, in particular by continuing to provide assistance to the Implementation Working Group. The aim is to ensure the successful implementation of an independent industry-funded Ombudsman scheme, free of charge to consumers, which satisfies the criteria of independence, effectiveness, fairness, and public accountability.

  • Ombudsman appoints staff; finalises Terms of Reference and Memoranda of Understanding with relevant organisations (Q1);
  • Ombudsman premises, fixtures and fittings in place and staff training completed (Q1);
  • launch of Scheme (Q1);
  • liaison with independent industry Ombudsman as appropriate (Q2-Q4); and
  • continue to work with the DTI on development of appropriate legislation in the Communications Bill (Q1-4).


C10 Input to other consumer protection legislation


NI Equality scheme:

Nigel Humberston (tel:020 7634 8824, e-mail:

Welsh language scheme:

Terry Walker (tel:020 7634 8774, e-mail:

Objective: To ensure Oftel meets its statutory obligations in relation to non telecoms specific legislation concerning consumer protection. Specifically to ensure that Oftel’s Equality Scheme is approved by the Northern Ireland Equality Commission and that Oftel meets its statutory obligations under the Welsh language scheme.

  • Consult on screening processes and consider responses for Northern Ireland equality scheme (Q1-Q2);
  • monitor ongoing compliance with requirements (Q2-Q4) & submit annual equality report to the NI Equality Commission (Q4); and
  • to ensure effective implementation and monitoring of the Welsh Language Scheme (Q1 to Q4) & to produce a year-end report on the implementation of the Scheme (Q4).

C11 Data protection in telecoms

Project Manager:

Nigel Humberston (tel:020 7634 8824, e-mail:

Other contacts:

Frank Phillips (tel: 020 7634 8871, e-mail:

Objective: To ensure compliance with the requirements of relevant data protection legislation and to input in to the EC review of the Communications Data Protection Directive. To consider with the Information Commissioner the wider implications of the revised Directive on broadcasting.

  • Ongoing monitoring of the performance of the Telephone and Fax Preference services. (Q1-Q4);
  • ongoing Provision of technical advice to Information Commissioner. (Q1-Q4); and
  • input into implementation of revised Communications Data Protection Directive including preparation for any structural changes required to current regime. (Q1-Q4).

C12 Calling line identification

Project Manager:

Frank Phillips (tel: 020 7634 8871, e-mail:

Other contact:

Philip Cobb (tel: 020 7634 8913, e-mail:

Objective: To develop and maintain regulatory arrangements for CLI services across differing technologies that (i) achieve a balance between the benefits they offer to business and residential users and the protection of those users’ privacy rights; and (ii) are sufficiently flexible not to stifle the service’s continuing commercial development.

  • Adoption of generic Code of Practice and development of technology-specific annexes to the Code (Q1);
  • revisit regulatory arrangements to take account of revised EU framework (eg erosion of boundary between network operators and service providers, new (CDPD) Communication Data Protection Directive legislation) (Q2-3); and
  • consider the possibility of developing a consistent policy on the treatment of CLI information for calls that break out of the public network in the course of their transmission before being delivered (Q1-2).

Prevention of anti competitive practice


D1 Developments in competition policy programme

Programme Manager:

John Kemp (tel: 020 7634 8885, e-mail:

Other contacts:

Alistair Bridge (tel: 020 7634 8782, e-mail:

David Blocksidge (tel: 020 7634 8995, e-mail: david

Objective: To achieve more effective prevention of anti-competitive practices by ensuring that Oftel contributes effectively to the development and implementation of competition policy in the UK and EC.

  • Consider any policy issues arising from the operation of the Competition Act (Q1-Q4);
  • contribute to the objectives of the Concurrency Working Party, a body consisting of representatives of the OFT and the regulators with concurrent powers under the Competition Act (Q1-Q4); and
  • contribute to the implementation of the EC Directives in line with Competition rules (Q3-Q4).

D2 Financial information systems programme

Project Manager:

Gavin Greenfield (tel: 020 7634 8734, e-mail:

Other contact:

Dave Robinson (tel: 020 7634 8933, e-mail:

Objective: To ensure that Oftel has access to relevant, accurate and timely financial and other information from operators designated as having significant market power, market influence or equivalent, to deal effectively with competition and regulatory issues.

  • Propose and implement changes to regulatory financial reporting arrangements necessary to comply with regulatory obligations eg local loop unbundling, partial private circuits, carrier pre-selection (Q1-Q4);
  • monitor and evaluate compliance with regulatory financial reporting requirements as set out in operators’ licences (Q1-Q4);
  • assess and examine the processes, systems and procedures used by operators in preparing and delivering financial information requested by Oftel as part of regulatory requirements or competition investigations (Q1-Q4);
  • promote and review developments and enhancements to the accounting methodologies used by operators in the above context (Q1- Q4); and
  • review regulatory accounting regime in light of new EC Directives (Q1-Q3).


D3 Compliance Casework Programme

Programme Manager:

John Kemp (tel: 020 7634 8885, e-mail:

Other contacts:

Maeve Gallagher (tel: 020 7634 8777, e-mail:

Tim Cross (tel: 020 7634 5359, e-mail:

Alistair Bridge (tel:020 7634 8782, e-mail:

Mergers programme:

Michael Knowles (tel: 020 7634 8706, e-mail:

Objective: To prevent anti-competitive practice. To manage casework and to resolve all cases in the minimum possible time. To use the Competition Act wherever appropriate. Cases include: investigation of complaints and own initiative investigations under the Telecommunications Act, Competition Act, and other UK and EU legislation under which the Director General has powers and duties. The programme includes complaints concerning the Internet, broadband, and unfair contract terms; also interconnection disputes and determinations. Mergers programme: Identify significant competition and regulatory issues arising from possible mergers and joint ventures in telecoms and related sectors, and provide timely advice to the competent authorities (OFT, DTI) accordingly.

  • To improve performance against casework processing targets, via quality monitoring of case progress and handling (Q1 –Q4);
  • to reduce the number of complaints being pursued as a licence breach by considering them under the Competition Act where appropriate (Q1-Q4);
  • to provide advice to OFT on request within the framework prescribed by the Fair Trading Act 1973 and the European Merger Control Regulation (ECMR) respectively (Q1-Q4); and
  • develop process for meeting the new 4 month deadline coming from the Directives for completion of cases (Q1-Q4).

D4 International controls

Programme Manager :

Vince Affleck (tel :020 7634 8819, e-mail:

Other contact : tba

Objective: To enable the full benefit of market forces for the benefit of consumers by withdrawing from detailed regulation as the international market becomes progressively competitive.

  • Monitor accounting rate developments to put pressure on international operators and overseas administrations to reduce accounting rates to cost (Q1-Q4);
  • monitor developments in international markets and to seek to reduce obstacles to market entry and facilitate competition (Q1-Q4); and
  • represent UK interests in ITU Study Group 3 and other international fora as appropriate. (Q1-4).

D5 Interconnection

Programme Manager:

Vince Affleck (tel: 020 7634 8819, e-mail:

Other contact:

Andrew Walker (tel: 020 7634 8909, e-mail:

Objective: To ensure that effective network competition is supported by the effective operation of the UK interconnection regime.

  • Monitor compliance by operators with Significant Market Power (SMP) under the Interconnection Directive with their SMP obligations (Q1-Q4);
  • deal with requests to resolve interconnection disputes in light of enhanced timetable published by Oftel in November 2001 (Q1-Q4);
  • revise procedures to cope with shorter EC timescale for dispute resolution under the proposed Framework Directive (Q1-Q2); and
  • maintaining the Annex II list of telcos entitled to cost based interconnection (Q1-Q4).

D6 Retail pricing issues

Programme Manager:

Andrew Walker (tel: 020 7634 8909, e-mail:

Other contact:

Keith Loader (tel: 020 7634 8793, e-mail:

Objective: To analyse competition effects of BT’s pricing proposals (including requests for reduced price publication notification periods and below cost pricing)

  • To assess affinity deals and new service trials against licence conditions and Oftel guidelines (Q1-Q4); and
  • to scrutinise PTO retail price change notifications and identify changes to be investigated by Oftel (Q1-Q4).


D7 Competition Act strategy project

Project Manager:

Alistair Bridge (tel: 020 7634 8782, e-mail:

Other contact:

Trevor Wood (tel: 020 7634 8850, e-mail:

Objective: To achieve effective competition and more effective prevention of anti-competitive practices by implementing Oftel’s Competition Act strategy ie where Oftel is likely to use the Competition Act as opposed to relying on licence conditions.

  • Monitor case procedures to ensure they are in accordance with the Competition Act Strategy and produce a report (Q2); and
  • ensure any additional training is available for case officers to fully comply with the strategy (Q2).

NOTE: This project should end after Q2 as the work will then be incorporated into the Casework Management programme and the Quality Assurance programme.

D8 Compliance Monitoring Unit programme

Programme Manager:

Andrew Walker (tel: 020 7634 8909, e-mail:

Other contact:

Keith Loader (tel :020 7634 8793, e-mail:

Objective: To ensure that compliance issues (such as casework in compliance phase, obligations under licences etc) are effectively co-ordinated and to identify suitable issues for future self and co-regulation.

  • To assess the information received in support of casework in the compliance phase and recommend actions to conclude cases where appropriate (Q1-Q4);
  • to recommend areas currently being monitored for self-regulation by the industry (Q1-Q4); and
  • to operate and develop the system for monitoring public network’s performance with regard to outages and continuity of 999 service (Q1-Q4).

D9 Compliance casework quality assurance programme

Programme Manager:

Mohinder Mahi (tel. 020 7634 8872, e-mail:

Other contact:

Peter Silverman (tel. 020 7634 8737, e-mail:

Objective: To develop and operate a robust framework which enables compliance and competition casework to be conducted in an open, transparent and consistent manner.

  • Operate an output based Casework Quality Monitoring System (Q1 – Q4);
  • identify and introduce best practice and lessons drawn from the quality assurance assessments within the Compliance Directorate (Q1 – Q4); and
  • continue process of making the Competition Bulletins ‘user friendly’ for external stakeholders (Q1-4).

Overall framework of regulation


E1 Communications Bill

Project Manager:

Neil Buckley (tel: 020 7634 5356, e-mail:

Other contact:

Ian Moss (tel: 020 7634 8861, e-mail:

Objective: To enable the development of a competitive market for converging services with appropriate consumer protection by working with Government and other stakeholders to update and reform the Telecommunications Act 1984 and the Broadcasting Acts.

  • Working with the Government on the strategic framework for OFCOM, OFCOM’s Consumer Panel, the objectives for legislative reform, ensuring consistency with Oftel’s Strategy and the new EU Directives on electronic communications (Q1); and
  • contribute to the development of the Communications Bill (Q1-Q4).

E2 General conditions of entitlement

Project Manager:

Lucy Byers (tel: 020 7634 8892, e-mail:

Other contact:

Neil Buckley (tel: 020 7634 5356, e-mail:

Objective: To draft a set of general conditions of entitlement, as part of the new Directive implementation process. Such conditions will apply to those who provide electronic communications networks and/or electronic communications services. The conditions will apply under the general authorisation that will be introduced by the Communications Bill or Statutory Instruments implementing the new draft Directives. The general rules will implement the requirements of the new draft Directives as well as the Communications Bill (if appropriate).

  • Drafting an initial set of general conditions consistent with Oftels’ Strategy and the new EU Directives (Q1);
  • holding discussions on the draft conditions with DTI and other interested stakeholders including consumer representatives and telecoms companies (Q2-Q3, dependent upon overall timing of implementation); and
  • amending the conditions as necessary in order to prepare a final draft set of conditions to be consulted upon in conjunction with either the Communications Bill or Statuary Instruments (Q2-Q4, dependent upon overall timing of implementation).

E3 Research into consumer views

Project Manager:

Karen Metcalfe (tel: 020 7634 8918, e-mail:

Other contact:

Lisa Etwell (tel: 020 7634 8741, e-mail:

Objective: To support policy development, implementation, and compliance actions, by providing regular and comprehensive information on residential and business consumer behaviour, opinion, and use of telecoms.

  • Conduct continuous quarterly-rolling omnibus survey (carried out by an external agency and analysed by Oftel) amongst UK residential and business consumers on their use and opinion of fixed and mobile telecoms services, Internet, digital TV, and other topics as required for Oftel work (Q1, Q2, Q3, Q4);
  • conduct and develop more targeted and intensive ad hoc research in key areas as required by Oftel programmes and projects (Q1 to Q4);
  • conduct continuous six-monthly survey examining consumers' use of, and attitudes to, Internet and broadband services in the UK compared with consumers abroad (Q2 and Q4);
  • conduct continuous six-monthly customer satisfaction survey, amongst consumers who have contacted Oftel's Consumer Representation Section, examining their opinion of the service and assistance they received (Q1 and Q3);
  • liase regularly with other OFCOM regulators on joint research projects (Q1 to Q4); and
  • consider and examine relevant research from other sources and where necessary reconcile any differences with Oftel research (ongoing).

(see appendix 4 for details of market research programme)

E4 Industry data collection programme

Project Manager:

Kenny Osborne (tel: 020 7634 8973, e-mail:

Other contacts:

Nick Collins (tel: 020 7634 8851, e-mail:

Robert Turner (tel: 020 7634 8778, e-mail:

Objective: To ensure that Oftel has sufficient information from the telecoms industry to allow evidence-based policy development by managing the collection and publication of accurate information from telecoms operators and service providers on an agreed range of services.

  • Review collection and publication procedures in light of consultation proposals to be published in January 2002;
  • extend data collection to reflect developments in broadband;
  • ensure the consistent collection, analysis and publication of data from industry particularly to inform programme of EC reviews. (Q1-Q4); and
  • consider how data collection and publication be managed in more competitive markets to ensure the appropriate balance between the need to minimise the burden on industry and the need to continually monitor progress towards effective competition (Q3-Q4).


E5 Developing international relations

Project Managers:


Heather Clayton (tel: 020 7634 8979, e-mail:

Beyond Europe:

John Bean (tel: 020 7634 8821, e-mail:

Other contacts:

Rachel Coldeboeuf (tel: 020 7634 5306, e-mail:

Joanna Wifalk (tel: 020 7634 8808, e-mail:

Objective: To improve customer outcomes in the UK by identifying and applying best regulatory practice from elsewhere in the world. To maintain Oftel's international reputation by promoting and explaining the work of Oftel internationally including transferring Oftel's experience of evolving regulation where appropriate.


  • Develop relations with other European administrations and the European Commission (Q1 to Q4);
  • monitor Oftel’s compliance with European legislation, and liaise with the Commission in compiling yearly reports on Oftel’s progress in promoting competition in the UK telecoms market (Q1 to Q4); and
  • ensure the active participation of Oftel in:
    • the Independent Regulators Group (IRG) which comprises independent national regulatory authorities (NRAs) and which aims to facilitate the exchange of information and best practice between NRAs facing similar regulatory problems and issues; and
    • groups set up to contribute to the harmonisation of the application of the regulatory framework in preparation for the introduction of the new EU Directives. (Q1 – Q4).

Beyond Europe

  • Provide relevant input into UK’s position for the next round of WTO and GATS negotiations where these affect the telecoms sector (Q1-Q4);
  • maintain and enhance awareness within Oftel and key stakeholders of the international agenda, and continue to improve Oftel’s effectiveness in influencing this agenda (Q1-Q4); and
  • ensure efficient organisation of, and briefing for, inward visits from selected influential regulators and government representatives and for outward visits by senior Oftel staff (Q1- Q4).

E6 Stakeholder relationships

Programme Manager:

Michael Richardson (tel: 020 7634 8916, e-mail:

Project Managers:

Large Business User Panel

Alan Pridmore: (tel: 020 7634 8910, e-mail:

Small Business Task Force

Geoff Delamere: (tel: 020 7634 8745, e-mail:

Objective: To ensure that Oftel makes full use of the knowledge and experience which stakeholders can bring to Oftel’s decision making, and to ensure that stakeholder and Oftel resources are used efficiently and effectively.

  • Assess progress in implementing the new approach to public consultation which was outlined in Oftel’s August 2001 statement (Q1);
  • ensure that the Oftel Forum contributes strongly to the evolution of regulatory policy. Review the achievements of the forum in Q1;
  • review Oftel’s consultation processes to ensure compliance and compatibility with new European Directives, including publication of Guidelines on Oftel’s use of consultation (as required by the directives) (Q2);
  • hold quarterly meetings of the Large Business User Panel, publicise outcomes through website and ensure views are fed back into Oftel policy development (Q1-Q4);
  • implement any changes as a result of a review of the Large Business User Panel held in 2001/2 (Q1);
  • hold half yearly meetings of the Small BusinessTask Force (Q3-Q4) and encourage TelecomsAdvice website; to secure longer term funding from interested stakeholder parties (Q1-Q4); and assess its benefits in relation to its costs (Q1-Q2); and
  • continue to hold meeting of Operators Policy Forum as appropriate. (quarterly).

E7 Implementation of the new EU Directives

Project Manager:

Heather Clayton (tel: 020 7634 8979, e-mail:

Other contact:

Jim Niblett (tel: 020 7634 8780, e-mail:

Objective: To ensure that Oftel implements the new EU Directives in a timely and efficient manner. Market reviews are covered separately in A1.

  • Ensure that Oftel's work programme is sufficient to implement the new Directives in a timely and efficient manner (Q1);
  • ensure consistency of policy decisions between work areas and, where relevant, with Commission guidelines and other NRAs (Q1 – Q4);
  • identify where Oftel is at risk of not meeting its objective of timely implementation and work with project and programme managers to resolve problems (Q1-Q4); and
  • implementation of the New EU Directives within Oftel (beyond Q4) (see appendix 2 for details).

E8 Oftel Strategy implementation

Programme Manager:

Geoff Delamere (tel: 020 7634 8745, e-mail:

Project Managers:

Strategy Implementation/Self & co-regulation

Nic Green (tel: 020 7634 8891, e-mail:

Management Plan

John Wimmer (tel: 020 7634 8742, e-mail:;

Performance Measurement

Sarah Evans (tel: 020 7634 5320, e-mail:

Consumer detriment

Kenny Osborne (tel: 020 7634 8973, e-mail:

Objective: To review key strategic challenges for OFCOM and future Oftel strategy in order to promote opportunities for convergence and to minimise the market distortions arising from regulation.

  • To promote the application of Oftel’s strategy by sharing previous experience and advising on interpretation of strategy guidelines re option appraisal, market and non market review processes (Q1-Q4);
  • to establish a methodology for measuring consumer detriment to help assess the extent to which regulation is needed to deliver benefits to different customer segments (Q1-Q2);
  • to produce 2003/4 Management plan consultation and statement (Q3-Q4);
  • to assess Oftel’s performance and development in the communications market through measures such as Service Delivery Agreements (Q1 as part of Annual Report) and international benchmarking (Q1 and Q3) and through a monitoring log of Oftel decisions (Q3 and Q4); and
  • implement self and co-regulation mechanisms agreed with stakeholders (Q1-Q2).

E9 Preparing for OFCOM

Project Manager:

Ian Forsyth (tel: 020 7634 8776 e-mail:

Senior Project Manager:

Keith Long (tel: 020 7634 8811 e-mail:

Objective: To support the development of the new Office for Communications and ensure a smooth transition for Oftel responsibilities into the new organisation (this project deals primarily with the managerial implications of the new regime. Legislative aspects are being handled through project E1).

  • Ensure effective communication with all Oftel’s stakeholders including the ACTs on the development of OFCOM (Q1-4);
  • work with other regulators and Government on implementation of a transition plan that supports OFCOM’s creation in relation to OFCOM’s structure, culture, strategy and systems (Q1-4); and
  • work with other regulators, Government and the OFCOM Board to support the effective establishment of OFCOM in relation to corporate governance, funding regime and staff transfer (Q2-4) .

E10 Better information on companies and markets

Project Manager:

Justin Silvertown: (tel: 020 7634 8748, e-mail:

Other contacts:

Jennifer Genevieve (tel: 020 7634 8728, e-mail:

Robert Turner (tel: 020 7634 8778, e-mail:

Objectives: Ensuring that Oftel policy is informed by up to date market information by monitoring developments in telecoms companies and related markets, analysing their impact on Oftel’s work, disseminating these findings across Oftel.

  • Weekly and monthly commentaries on 'current telecoms issues' for Oftel staff (Q1-Q4);

  • presentations to Oftel – on key selected issues (Q1-Q4);

  • input to project teams, eg on EU Market Analyses (Q1-Q4);

  • development of key databases – Telco capital expenditure (Q3-Q4); and

  • ad hoc briefings for the Director General and Oftel directors (Q1 to Q4).

E11 Telecommunications Code and licensing

Project Manager:

Peter Davies (tel: 020 7634 8923, e-mail:

Other contacts:

Neil Paterson (tel: 020 7634 8732, e-mail:

Objective: To resolve satisfactorily the long standing problem of Funds for Liabilities, and to develop Oftel’s thinking on how OFCOM will grant rights for those involved in electronic communications who wish to make use of the new Electronic Communications Code.

  • Devise a regime for ensuring that operators have sufficient funds to meet their Telecommunications Code liabilities. Agree procedure with DTI, operators and highway authorities, possible amendments to Schedule 4 of all licences with Code Powers (Q2);
  • produce and obtain agreement for a new OFCOM policy for granting rights under the Code, including the establishment of any independent machinery for the awarding of consideration payable to landowners – subject to Parliamentary timetable (Q4);
  • licence modifications (DTI) following statement at end of 2001/2. Scheme in place (Q3);
  • make satisfactory arrangements for the transition of existing code users to any new licenceless regime which emerges following the adoption and implementation of the proposed EU legislation;
  • new Electronic Communications Code. Timetable determined by Parliamentary timetable (Q4); and
  • ad hoc work on issues arising from the current licensing regime (Q1-Q4).

E12 Regulation and corporate structure

Project Manager:

Neil Buckley (tel: 020 7634 5356, e-mail:

Other contacts:

Tim Cross (tel: 020 7634 8798, e-mail:

Objective: To ensure a rapid and proportionate response by Oftel to any proposals for corporate restructuring that could impact upon UK consumers, including proposals to purchase BT’s network or part of its network. The aim is to ensure that regulation following a major corporate restructuring is appropriate to enable achievement of Oftel’s key objectives and to enable the Director General to fulfil his legal duties.

  • To discuss with BT and AT&T, plus relevant stakeholders, any regulatory changes that are needed due to the ending of the Concert joint venture;
  • continue discussions with BT concerning the regulatory implications of line of business separation of BT Retail and BT Wholesale; and
  • ensure Oftel is able to respond promptly and effectively to plans for major corporate restructuring by any major UK operator including any proposals to purchase BT’s network or part of its network.

Internal business support projects and programmes

F1: Human Resources

Programme Manager:

Ros Badger (tel: 020 7634 8783, e-mail:

Other contact:

Gill Loader (tel: 020 7634 8789, e-mail:

Objective: To ensure that Oftel implements effective strategies, policies and procedures for the recruitment, retention, recognition and reward of Oftel staff.

The new system of performance and reward is aligned with both Oftel's business needs and its employee's aspirations and aims to maintain continuity and quality of staff in the lead up to OFCOM and beyond.

  • Introduce revised performance management system in the light of the new performance and reward arrangements. Including identifying training and development needs (Q1);
  • to continue to run recruitment programme minimising delays and matching best practice elsewhere (Q1-4);
  • to develop our procedures for monitoring and promoting our equal opportunities and diversity policy (Q3);
  • actively promote and monitor a reduction on sick absence in accordance with our target to reduce average number of days lost by sickness to 4.2 days per staff per year by 2003 (end Q4); and
  • evaluation and fit of performance and reward scheme with emerging HR priorities for OFCOM (Q4).

F2 Learning and development programme

Programme Manager:

Carol Coyne (tel: 020 7634 8997, e-mail:

Objective: To ensure that Oftel can meet its business objectives by providing high quality training accessible to every member of Oftel staff.

  • Design, deliver, evaluate events which meet individual and business needs using the best practice methods in the Investors in People (IiP) standard (Q1-Q4);
  • support the communication and implementation of the new EU Directives (Q1);
  • with other OFCOM organisations, plan and implement joint learning/development/training initiatives which strengthen the links between each organisation (Q1-Q2);
  • With other OFCOM organisations, respond to individual, team and organisational needs as they emerge to support the smooth transition into OFCOM (Q3-Q4); and
  • Expand the range of computer based training and distance learning materials available to supplement existing off-the-job training (Q1-Q2).

F3 Budget management programme

Programme Manager:

Paul Heseltine (tel: 020 7634 8791, e-mail:

Objective: To provide an effective finance and accounting service to the department.

  • Consult stakeholders to prepare a 2003-04 budget for inclusion into the 2003-04 Management Plan (Q3-Q4);
  • prepare Oftel’s annual accounts for NAO audit and publication (Q1-Q3); and
  • develop, with future OFCOM partners, proposals for harmonising finance policies and procedures (Q1-Q4).

F4 Knowledge management (internal communications)

Project Manager:

Laura Dawson (tel: 020 7634 8950, e-mail:

Other contacts:

Anne Cameron (tel: 020 7634 8958: e-mail: )

Objective: To capture, retain, map and distribute Oftel’s knowledge effectively. To manage Oftel’s knowledge assets ensuring continuity.

  • Development of clear internal communications policies and procedures (Q1-2);
  • development and implementation of Post Project Reviews to identify areas for continuous improvement in Oftel (Q2); and
  • to facilitate process improvements initiated by staff groups in away days & other themes (Q1-Q4).

F5 Electronic Records Management System (ERMS)

Project Manager:

Laura Dawson (tel: 020 7634 8950, e-mail:

Other contacts:

Rachel Reeve (tel: 020 7634 8762: e-mail:

Objective: To develop, design and implement an electronic records management system which will support not only Oftel’s obligations under the Public Records Act, but also Oftel’s knowledge management needs, provision of information to the public and to industry, ensuring a good fit with future OFCOM plans and meeting our obligations under the Freedom of Information Act.

  • Integrate Numbering, Casework and Directories systems into the ERMS (Q1/2);
  • provide web publishing and content management from system (Q2/3); and
  • ensure continued liaison and compatibility with external stakeholders and partners (ongoing).

F6 IS & IT

Project Manager:

Hari Bains (tel: 020 7634 8796, e-mail:

Objective: To provide efficient and effective Information Systems which support Oftel's business needs and meet the wider objectives of the Modernising Government (Information Age Government) programme.

  • Re-design the network architecture and upgrade services to improve performance of the system and deliver efficient and uninterrupted network services (Q1 – Q4);
  • implementation of the plans for BS7799 to ensure that Oftel information system assets are adequately protected and their integrity and availability maintained. (Q1 – Q4); and
  • implement web access to the Number allocation database providing customers with the facility to apply for blocks of numbers on-line (Q1 – Q3).

F7 Communicating Oftel’s work to external audiences

Programme Manager:

Duncan Stroud (tel: 020 7634 8750, e-mail:

Other contacts:

Rachel Millns (tel: 020 7634 8752, e-mail:

Objective: To ensure that Oftel’s work is communicated quickly and clearly to external audiences including the public, industry and media.

  • Maximise opportunities to promote Oftel’s work through the media in order reach key stakeholder audiences. Promoting Oftel’s work with the other communications regulators to create OFCOM will be an important part of this work (to Q4);
  • publicise and promote Oftel’s work to stakeholders through non-media channels including the quarterly magazine Oftel News, Oftel’s website, conference speaking engagements and publications such as consumer guides, Guide to Oftel and Oftel’s annual report (to Q4); and
  • support Oftel projects and programmes such as the Small Business Task Force, raising consumer awareness and Informing consumers and their advisors where communications is an important aspects of these projects. This also includes supporting work to share information across Oftel. (to Q4).

F8 Research and Information Unit

Programme Manager:

Anne Cameron (tel: 020 7634 8958, e-mail:

Other contacts:

Laura Dawson (tel: 020 7634 8958, e-mail:

Nigel Humberston (tel: 020 7634 8824, e-mail:

  • The new Intranet catalogue is available to all within Oftel. This allows searching for topics, titles and authors. It also displays location or holders of the source. Develop an information review to locate holders of journals, documents, papers etc and encourage inclusion in the catalogue. This will help identify and locate information sources in Oftel and avoid any duplication (Q1-Q2);
  • ensure policies and procedures are in place for handling enquiries under FOI including review of the publication scheme and FOI complaints handling (Q3); and
  • deliver the licences part of the public register electronically to stakeholders (Q3 / Q4).


Chapter 4

Budget for 2002/3

4.1 Oftel is directly funded by money voted by Parliament but, in common with many other regulatory bodies, most of the costs of the office are recovered through fees charged to holders of licences. The Director General of Telecommunications is the Accounting Officer for Oftel.

4.2 In December 1999 HM Treasury introduced measures to develop a more flexible funding regime for statutory utility regulators in the UK.

4.3 Oftel played an active part in an external efficiency review beginning in the end of 2000, to assess its effectiveness against comparator organisations including UK and overseas regulators. In July 2001 the consultancy firm WS Atkins delivered its report.

4.4 The new regime provides for licence holders, consumer committees and other interested parties to feed in any practical suggestions they may have for efficiency improvements as well as comments on Oftel’s expenditure plans. In response, Oftel implemented an Action Plan to take forward the key actions. The major action points included a commitment to:

  • provide detailed resource bids for 2002/03 in including estimates of staff resources and consultancy support required for each project/programme;
  • carry out post-implementation value for money reviews of major consultancy projects costing more than £250,000 (no action likely to be required in the medium term as current contracts are below this threshold);
  • identify projects/programmes costing over £250,000;
  • produce a cost benefit analysis on all major policy proposals that will lead to additional regulation or to the continuation of existing regulation (to be reflected in consultation documents or other published outputs);
  • continue to look for savings particularly in consultancy costs; and
  • publish a breakdown of policy and support activities.

4.5 Oftel has incorporated these proposals. Our consultation process has also involved, as recommended by Atkins, early notice of key issues to stakeholders through a meeting of the Oftel Forum and Advisory Committees conference in November. A more detailed update of progress against Oftel’s action plan will be included in Oftel’s 2001 Annual Report to be published in the Spring. The Annual Report will also be the main vehicle for reporting Oftel’s performance against its Service Delivery Agreement (SDA) targets. The following tables provide an outline of Oftel’s budgetary commitments for the year 2001-2 and its proposals for 2002-3.

Table 5 – Summary of expenditure and outturns





Initial budget

Revised budget

Planned expenditure

Expenditure type (£)

Administration Costs (AC's)









Rent (Ludgate Hill / Shoe Lane)




Training (PRTU)












Other AC's




Total AC's





Twinning with Poland












Total Programme




Notional Costs [depreciation] *





Furniture/Office Equipment








Total Capital








4.6 In addition there will be costs associated with preparatory work for OFCOM. These costs have not been included in Oftel’s budget for 2002-3 estimated costs, as funding from Government sources is being sought.

OFCOM – Consultancy




* Notional costs are included this year reflecting Oftel’s move from cash accounting to resource accounting.

4.7 These costs can be split by Directorate as follows:

Table 6 – Planned expenditure by Directorate for 2002/3

Regulatory Policy


Business Support & Top Management Team


Revised budget 2001-2







Bid 2002-3







4.8 This indicates a reduction in the proportion of costs on Business Support or Management Team between 2001/2 & 2002/3.

Budget by main category of plan

4.9 The following tables provide an approximate breakdown and costings of main resources (salaries, consultancy) of Oftel’s external facing work programme (ie all work described in chapter 3 excluding Internal projects/programmes ie projects F1-F8) calculated through the grouping of projects/programmes in relation to Oftel’s high level objectives and by type of activity as set out in Chapter 3, for the years 2001-2, and the proposed work programme for 2002-3.

Table 7 – Budget 2001/2 – Strategy by Objective


Effective competition

Well informed consumers

Adequately protected consumers

Prevention of anti-competition practice

Overall framework






























Table 8 – Budget 2002/3 – Strategy by Objective


Effective competition

Well informed consumers

Adequately protected consumers

Prevention of anti-competition practice

Overall framework






























Variance between 2001-2 & 2002-3 £1.5m approximately 16%

Table 8A

Approximate salary increase


Approximate consultancy increase


Total increase


Less Twinning with Poland project (not in 2002-3)


Less other reductions




The following gives more detail as to the major factors impacting on Oftel’s budgetary increase.

Main explanatory factors in 2002-3 budget increase

Recruiting and retaining staff

4.10 This was a major issue last year following the loss of some 47 per cent of staff at middle and senior management levels in 1999 and the continued high staff turnover last year averaging some 27 per cent. Although staff turnover is forecast to be down to a still high 16 per cent this year, retention remains a major issue for Oftel in the run up to the creation of OFCOM planned for 2003. The risk of a return to unacceptably high turnover rates is likely to increase in the year 2002-3 as we work towards transition to the new body. Given the short remaining life of Oftel, recruitment is also expected to become increasingly difficult. This high staff turnover has presented significant risks to Oftel in two major respects. Firstly the loss of trained, experienced and telecoms knowledgeable staff, has the potential to impact on Oftel’s operational effectiveness. Secondly, the financial costs entailed through having to recruit and train new staff members.

4.11 In response to the high turnover of staff, and a recommendation in the Performance and Innovation Units report e-commerce@its best.UK. In 2001-2 Oftel launched a review of its broad banded pay structure and performance management system. One key driver for this was to ensure that Oftel has effective strategies to ensure the recruitment and retention of staff in the lead up to OFCOM. The result of an external consultants report was the introduction of a new performance and reward system based on career ladders that would see market related salaries paid to individuals, whose skills are marketable to regulated companies, the City and consultancy practices.

4.12 The result has been an increase in pay across Oftel, reflecting new recruits paid at higher salaries than their predecessors and entailing a subsequent salary catch up for staff in post. This was agreed by Treasury/Cabinet Office and was supported by the recommendations of the External Efficiency Review carried out by WS Atkins. The full financial year effect of these changes represents the single biggest increase to Oftel’s work programme budget from 2001-2. The full effect of the programme will achieved in 2002/3.

4.13 As can be seen from tables 5 & 8A above, planned expenditure on the paybill for 2002-03 is considerably higher than current year budgets. There are a number of important reasons for this. Higher spend planned for 2002-03 is in part accounted for by the fact that the total number of staff is expected to be close to full complement at the beginning of the year whereas in 2001-02 staff numbers were some 10 per cent below complement and recruitment only picked up slowly. More recently, the recruitment of replacements for leavers has only been achieved through offering rates of pay closer to external comparators and the mix of staff has had to be changed to bring in the specialists required to meet the expanding workload and new challenges. The higher starting salaries required to attract scarce skills and experience has therefore introduced higher ongoing costs to the paybill – the full impact of which will be felt in 2002-03. Additionally the introduction of Oftel’s new performance and reward system has provided staff with improved and more visible opportunities for progression and promotion. This has enabled Oftel to bring on talent more rapidly.


4.14 The other major factor in Oftel’s budgetary increase in 2002/3 is an increase in Oftel’s projects and requiring consultancy, brought about by changing market conditions or other external factors. The single major area where Oftel’s consultancy bid has increased is for EU Market Reviews reflected in project A1and a range of projects under the effective competition objective. The implementation of the new EU Framework Directives will mean that Oftel will be required to carry out market analyses across a range of market segments, this will require a substantial increase of Oftel’s resources in this area (some £500,000) and will represent a fundamental review of telecoms regulation in the UK.

4.15 Other areas impacting on Oftel’s resource requirements include:

  • work associated with the Mobile Termination Charges reference to the Competition Commission; and
  • an increasing need for legal assistance as Oftel is required to determine service levels to be inserted into contracts (interconnection disputes etc) and as appeals arise following some high profile Competition Act decisions.

4.16 Increases by category of work ie implementation, review, monitoring.

Table 9 – Main causes

Increases in budget


Increase in review costs:


The major increases relate to consultancy of 500K for the EU Market Review project and the moving of Oftel’s Market Research project (£450K) from Implementation to Review & Mobile Termination Charges referral to the Competition Commission

4.17 Changes on the previous year can also be considered in relation to cost increases/decreases by objectives.

Table 10 – Cost increases/decreases

A. Effective competition: £1.9m

EU Market Reviews

B. Well informed consumers: £0.6m (decrease)

Transfer of Market research project to Column E. Overall framework of regulation

E. Overall framework of regulation: £0.4m increase

4.18 The following table identifies projects/programmes definitely costing more than 250K. The figures include approximate manpower & consultancy costs.

Table 11

Projects/programmes costing over £250k

E6 Oftel strategy implementation

C3 Mobile termination charges

A7 Numbering programme

E2 Research into consumer views

D3 Compliance casework programme

A8 Access to broadband services over the local loop

C5 Consumer representations

A1 EU Market reviews

Licence Renewal Fees

4.19 Under the EC Authorisation and Licensing of Telecommunications Directive (97/13/EC), the cost of certain areas of Oftel’s activities cannot be recovered from licence fees. Based on Oftel’s current expenditure plans for 2002-03, some £0.8 million will be sought from Government sources to meet such costs.


Chapter 5

Consultation process and questions

5.1 This chapter sets out:

  • consultation questions;
  • how to respond to the consultation; and
  • who is being consulted.

Consultation questions

5.2 Consultees are asked to respond to the following questions:

Q1 Do you agree with the actions being taken to update Oftel's strategy (paragraphs 1.12 onwards in Chapter 1) in response to the experience of the past two years? What other responses would be appropriate?

Q2 Do you see the strategy for broadband services set out in Chapter 2 as being consistent with Oftel's overall strategy?

Q3 Do you think Oftel's proposed work plan for 2002/3, as set out in Chapter 3, covers the key areas that need to be addressed?

Q4 If not, what areas do you consider should have greater priority?

Q5 Do you think that the new analysis of Oftel's budget (set out in chapter 4) (by objective and by stage of regulatory process ie review/implementation/monitoring) is helpful?

Q6 Do you have any comments on where resources are focused or where efficiency improvements could be made?

How to make comments on the questions raised in this consultation document

5.3 Oftel is publishing this consultation document so that interested parties may comment on the issues which it addresses. The closing date for submitting comments is 31 January 2002.

5.4 Where possible, comments, and comments on comments, should be made in writing and sent by e-mail to However, copies may also be posted or faxed to the address below. If any interested parties are unable to respond in one of these ways, they should discuss alternatives with the Oftel manager named below:

John Wimmer
50 Ludgate Hill
London EC4M 7JJ

tel: 020 7634 8742
fax: 020 7634 8757


Further copies of this document

5.5 This document can be viewed in the publications section of Oftel’s website at

5.6 Alternative formats such as large print, Braille, disc and audio cassette can be made available on request. Please contact Oftel’s Research and Information Unit by phoning 020 7634 8761 or by sending an e-mail to

Publication of comments made by stakeholders

5.7 On this occasion, Oftel is not programming a formal period during which interested parties may comment on the responses made by others. Nevertheless, in the interests of transparency, all non confidential comments and comments-on-comments, will be published. Respondents should separate out any confidential material into a confidential annex which is clearly identified as containing confidential material. Oftel will take steps to protect the confidentiality of all such material from the moment that it is received at Oftel’s offices. However, in the interests of transparency, respondents should avoid applying confidential markings wherever possible.

5.8 Non-confidential responses can be viewed on Oftel’s website in the publications section under ‘Responses to Oftel consultations’. They can also be viewed at Oftel’s Research and Information Unit. Appointments must be made in advance by phoning 020 7634 8761 or sending an e-mail to

e-mail notifications

5.9 Oftel has a free e-mail based mailing list to help people stay informed about the work that Oftel is doing. Each time an Oftel document is published and placed on Oftel’s website at, subscribers to the list receive an e-mail alert. To register, please go to the ‘What’s New’ section of the website and access the electronic form.

Consultation criteria

5.10 Oftel considers that this document meets the Cabinet Office code of practice on written consultation documents except for the period of consultation which is explained below. The code is reproduced below for convenience. If you have any comments or complaints about this consultation process please contact:

Robert Jex
Oftel Co-ordinator for the Code of Practice
50 Ludgate Hill
London EC4M 7JJ

tel: 020 7634 5350
fax: 020 7634 8943


1. Timing of consultation should be built into the planning process for a policy (including legislation) or service from the start, so that it has the best prospect of improving the proposals concerned, and so that sufficient time is left for it at each stage.

2. It should be clear who is being consulted, about what questions, in what timescale and for what purpose.

3. A consultation document should be as simple and concise as possible. It should include a summary, in two main pages at most, of the main questions its seeks views on. It should make it as easy as possible for readers to respond, make contact or complain.

4. Documents should be made widely available, with the fullest use of electronic means (though not to the exclusion of others), and effectively drawn to the attention of all interested groups and individuals.

5. Sufficient time should be allowed for considered responses from all groups with an interest. Twelve weeks should be the standard minimum period for consultation (see note below for why a shorter period has been chosen for this consultation).

6. Responses should be carefully and open-mindedly analysed, and the results made widely available, with an account of the views expressed, and reasons for decisions finally taken.

7. Departments should monitor and evaluate consultations, designating a consultation co-ordinator who will ensure that all lessons are disseminated.

The formal consultation period for this document is 6 weeks. The shorter consultation period is justified on the following grounds:

  • Treasury requirement for consultation plan by end of January 2002 in order
  • to agree budget bid;
  • fast moving nature of the industry means that earlier consultation would give less chance to reflect up to date position and less time to assess current year progress and developments;
  • annual nature of consultation means it is more predictable for stakeholders; and
  • Oftel Forum meeting 2 November gave stakeholders opportunity to give initial views on priorities for 2002/3 and to start considering their priorities for 2002/3.

The following organisations are being consulted:

  • Advertising Standards Authority (ASA);
  • Age Concern England;
  • American Express Services Europe Ltd;
  • Antelope;
  • AUCS Communications Services (UK) Ltd/Infonet-Europe;
  • Band-X;
  • BBC;
  • Broadcasting Standards Commission;
  • Broadsystem Ventures Limited;
  • BSkyB;
  • BT;
  • BT Cellnet;
  • Cable & Wireless Communications Ltd;
  • Carlton;
  • Cellcom;
  • Centre for Utility Consumer Law;
  • Centrica;
  • Cix-Compulink;
  • COLT;
  • Commerce Groups – CBI, Chambers of Commerce;
  • Communications for Business (CfB) Advisory Committee;
  • Communications Managers Association;
  • Competition Commission;
  • Concert;
  • Consignia;
  • Consumer Communications for England (CCE);
  • Consumers' Association;
  • Deaf Broadcasting Council;
  • Department of Trade and Industry;
  • DIEL (the Advisory Committee on Telecommunications for Disabled and Elderly Users);
  • ECTRA;
  • Ednet;
  • Energis;
  • Equant (Global One Communications);
  • Eurobell;
  • European Commission;
  • Eversheds;
  • Federation of Communication Services Ltd;
  • Federation of Small Businesses;
  • Forum for Private Business;
  • Freephone User Group (FUG);
  • Genesis Communications;
  • Global Crossing;
  • Granada;
  • GTS (Esprit Telecom);
  • Helplines;
  • Hutchison 3G;
  • Independent Committee for the Supervision of Telephone Information Services (ICSTIS);
  • Independent Television Commission (ITC);
  • ITV Network Centre;
  • Internet Society;
  • Internet Watch Foundation;
  • Interoute Telecommunications;
  • ISPA;
  • KDD Europe Ltd;
  • Kingston Communications;
  • Let-it-bee-thus;
  • LINX;
  • London Business School Centre for Marketing;
  • Marconi;
  • Mencap;
  • NACAB;
  • National Audit Office;
  • National Consumer Council;
  • National Regulatory Authorities for electronic communciations services for EU Member states;
  • NEA;
  • NIACT;
  • Nominet UK;
  • Nortel;
  • NTL;
  • Office of Fair Trading;
  • Oftel Large Business User Panel;
  • One2One;
  • 186k;
  • OneTel;
  • Opal;
  • Orange;
  • Other government departments – DTI, DCMS, DfEE, Home Office, Cabinet Office;
  • Parliamentary Committees and devolved administrations – TISC, PAC, PITCOM, House of Lords Science and Technology Committee, Welsh Assembly, Scottish Parliament, Northern Ireland Assembly;
  • Powergen;
  • Primus Telecommunications;
  • Project Telecom;
  • Public Utilities Access Forum (PUAF);
  • Radio Authority;
  • Radiocommunications Agency;
  • Rocom Network Services Ltd;
  • Royal National Institute for the Blind;
  • RSL Com UK Ltd;
  • Scottish Advisory Committee on Telecommunications;
  • Service Provider Interest Group (SPIG);
  • Servista;
  • Six Continents;
  • Spitfire Technology Group;
  • Swiftcall;
  • Tele2;
  • Telecoms Users Association;
  • Teleglobe;
  • Telewest;
  • Telia;
  • Telstra;
  • Thus;
  • TIA;
  • Tiscali/World Online;
  • Trading Standards Offices (via LACOTS);
  • Utility regulators – OFGEM, OFWAT, ORR;
  • Vanco;
  • VarTec Telecom (UK) Ltd;
  • Ventelo;
  • Virgin;
  • Vodafone UK Limited;
  • Welsh Advisory Committee on Telecommunications (WACT);
  • Working Group on Hearing Impaired;
  • World Trade Organisation (WTO);
  • Worldcom Ltd; and
  • Your Communications.


Annex 1

Summary of Oftel regulatory decisions

April – Nov 2001 (excluding cases)

Formal regulation

Removal of regulation

Local loop unbundling – Wholesale price setting and measures to enable competitors to get adequate access to BT's exchanges

Mobile market – lift requirement on Vodafone and Cellnet to supply air time to independent service providers

BT Licence conditions – Oftel revoked Caller Display order

Unmetered internet access – BT charges set by Oftel for competitors to purchase unmetered input for internet access products

Directory enquiries – change to '192' code to enable other operators to provide DQ service on a competitive basis

Retail price control fixed link – price control extended for 1 year (to July 2002)

Forebear from adding further regulation

Cable – no requirement on cable companies to provide open access to their networks

USO – no increase in USO baseline/ current basis of USO extended

Self/Co statement – no requirement for set up of formal umbrella body of stakeholders to manage self/co regulation initiatives

Price of calls to mobile – wholesale price controls on call termination

Extension of definition of controlled Premium Rate Services

Banning on revenue sharing on 070 numbers


Self Regulation

  • Stakeholder consultation – widened range of consultation techniques

Telecoms Ombudsman – industry developing funded scheme (with Oftel support of process)

  • Sim locking and number portability research – test of telco compliance with licence condition

Quality of service – indicators published 6 monthly by industry funded 3rd party

  • Call success rates – test of mobile networks

Price comparisons – phonebills website updated

  • Spectrum trading – Oftel response to Cave review supporting widespread spectrum trading

TelecomsAdvice website – website upgraded to better meet small business needs

  • Consumer leaflets published by Oftel

  • Guidelines to help operators meet licence conditions re info for disabled consumers


Annex 2

Impact of the EU Directives

The new EU Directives are currently under negotiation. The final text should be agreed late in 2001 or early in 2002. The Directives will enter into force when they are published in the Official Journal of the European Communities. From entry into force, Member States and National Regulatory Authorities (NRAs) have 15 months in which to transpose the Directives into national law and bring all processes and procedures in line with the new Directives.

The purpose of the new Directives is to establish a harmonised framework for regulation across Europe and establish a set of procedures to ensure the harmonised application of the regulatory framework throughout the Community.

There are five directives:

Framework Directive (FD)

As the name implies, this Directive sets the overall framework, including objectives and principles which Oftel must take into account when making regulatory decisions. In addition, the framework directive sets out the principle that, in most cases, market reviews must be carried out before regulation is imposed and that regulation is only to be imposed where the market is not effectively competitive. Significant Market Power has been newly defined so that it is equivalent to the competition law concept of dominance.

Other provisions in the FD include the obligations on NRAs to consult with the Commission and other NRAs before taking decisions and procedures to ensure the harmonisation of regulation across Europe.

Authorisation Directive (AD)

This Directive requires the abolition of the existing licensing regime. The providers of electronic communications networks and services will no longer be required to obtain explicit approval before they can offer services. Where NRAs require it, operators may be required to submit a notification of their intention to offer networks and services.

The AD sets out a maximum list of obligations that can apply to all providers of networks and services. These 'general conditions' will replace existing licence conditions.

Access and Interconnection Directive (AID)

This Directive deals with wholesale relationships between providers of networks and services and associated facilities. The AID places general obligations on operators to negotiate interconnection.

This Directive also sets out the responsibilities of NRAs and the limits of their discretion in imposing obligations related to access or interconnection. For the most part, such obligations can be imposed only on those found to have SMP in the relevant wholesale market.

Universal Service Directive (USD)

The USD sets out a procedure for designating providers of universal service and a minimum set of services that these operators must provide.

In addition to dealing with universal service, the USD details specific obligations that may be imposed on particular providers that are found to have SMP in retail markets, much as the AID does for wholesale markets. Also included in the USD are provisions covering consumers’ contracts with telecoms providers, number portability and procedures for providing consumers with an out of court dispute resolution process.

Data Protection Directive (DPD)

This directive aims to ensure protection of users’ right to privacy in the processing of telecommunications data. The DPD is lagging behind the other directives in the negotiation process and the final text will be agreed later than the other four Directives.

Impact on Oftel’s workplan

During the transitional period (from entry into force until transposition of the directives into national law) Oftel must:

  • work with the DTI to transpose the Directives;
  • carry out market reviews; and
  • adjust all its processes and procedures to be in line with the new Directives including the introduction of particular procedures to meet Oftel’s obligation to contribute to the harmonised application of the new framework across Europe.

work to implement directives

On the day after the Directives enter into national law:

  • all individual licences will be revoked and the new authorisation regime will apply;
  • all regulatory actions will be carried out under the new Directives;
  • Oftel will publish its determinations of SMP and specific obligations on SMP operators; and
  • Oftel will publish designations of Universal Service Operators, details of universal service obligations and specific interconnection and access obligations.

The Market Reviews

As noted above, the new framework will oblige Oftel to review markets, prepare SMP designations and review all regulatory measures currently in place in all telecommunications markets ready for when the Directives enter into national law.

Oftel envisages at this stage that the process by which market reviews are carried out will be similar to that for Oftel’s current programme of effective competition reviews. The process will be updated by:

  • reviewing experience to date on effective competition reviews – this is currently being done and will be continued in Q4 2001/02; and
  • taking into account any guidelines issued by the Commission.

The markets to be reviewed and the order in which they are reviewed will be defined by a number of factors including:

  • Oftel and stakeholder priorities, particularly related to when previous reviews have been carried out;
  • the Commission’s recommendation on market definitions; and
  • the need to co-ordinate and discuss decisions with the Commission and other NRAs.

The current indications from the commission are that regulatory authorities will not see any indication of Commission defined markets until the directives come into force. However, Oftel envisages reviews being carried out in at least the following broad sectors which will cover voice and data, and both retail and wholesale markets, where appropriate:

  • mobile – including calls to mobile;
  • fixed PSTN; and
  • leased lines.

In addition, the Directives require the obligations that the Directives will automatically impose on providers of conditional access in the broadcasting market to be reviewed. It is also envisaged that some form of 'broadband' market review, including local loop unbundling and wholesale DSL provision will be needed. Oftel is currently undertaking a review of all obligations under the current directives so that it can ensure that they are reviewed in the appropriate market review.

It is useful to indicate the current position in terms of market reviews being conducted by Oftel as these reviews will have an influence on the timing and scope of EU market reviews to be conducted by Oftel.


  • market review undertaken in 2001/2 – statement issued in September 2001; and
  • charges on calls to mobile also reviewed in 2001/2 and statement issued in September 2001.

Fixed PSTN

  • review of retail price controls on BT currently underway, due to complete summer 2002.

Leased lines

  • current review of partial private circuits is underway – due to publish consultation document in 2001/2.

Dial-up Internet access

  • consultation document published July 2001 – statement due in first quarter of 2002.

Conditional access

  • consultation document published in October 2000.

Oftel intends to inform and informally consult with stakeholders on the EU market review process in Q4 2001/02 (ie January – March 2002). Scope for formal consultation will be limited by the constraints imposed by the EU timetable and the scope and timing of any mandatory requirements made by the Commission on Oftel.


Annex 3

Non-market reviews – indicative timetable

Review timings will depend on implementation of EU Directives and when policy areas were last reviewed, for example:

  • Calling Line Identification: early to mid 2003, implementation of Data Protection Directive;
  • Data Protection – Q1-2002 implementation of new EU Directives – Q1-2003 appropriate time to review Oftel’s on-going involvement;
  • Payphones Policy: Statement April 2002;
  • Premium Rate services: Statement July 2001;
  • Universal Services: Statement August 2001 – Implementation of USO Directive early mid 2003;
  • Numbering: Q1 each year annual numbering audit; and
  • Ombudsman Scheme: July – December 2003 Appropriate time for review.


Annex 4

Market research plans for 2002/03

Quarterly UK surveys

Continuation of existing quarterly UK research programme amongst residential consumers and small and medium businesses. This provides trend information on awareness, use, satisfaction, and interest in new and existing products and services in the fixed and mobile telecoms, Internet, and digital TV markets. It also provides more ad hoc measurement of specific issues – examples during 2001/02 included equipment rental, awareness and use of personal and corporate numbering, satisfaction with telecoms complaints, and interest in broadband.

Ad hoc research

Continue and develop ad hoc research programme amongst residential and business consumers, both in the UK and abroad as required. Examples from 2001/02 include use of mobiles in the UK vs abroad; testing broadband Internet; mystery shopping in the mobile market examining advice given on switching; the importance of brand image in fixed telecoms; consumers use of digital TV; assessing Oftel’s consumer guides.

International research comparisons

Continue and develop the six-monthly international research comparisons amongst residential and business consumers in the UK, France, Germany, Sweden, and the US states of California and Ohio. These examine awareness, use, and opinion of fixed telecoms, Internet, and broadband services.




Layout image
Layout image Layout image
Layout image Layout image Layout image
Layout image Layout image