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Annual Report and Accounts 1999-2000Accounts and Financial Information |
History and background
The Radiocommunications Agency is responsible for most non-military radio matters in the UK. It was established as an Executive Agency of the Department of Trade and Industry (DTI) in April 1990. The Agency is funded through the DTI Vote (Class IX Vote 1). HM Treasury's latest Accounts Direction dated 29 June 1999, under the provisions of Section 5 of the 1921 Exchequer and Audit Departments Act requires the Agency to comply with the accounting principles and disclosure requirements of the edition of the Resource Accounting Manual which is in force for the financial year for which the accounts are prepared. These accounts have been audited by the Comptroller and Auditor General.
Results and appropriations
The surplus for the year amounted to £28.1M (1998/99: £13.7M). Details of the amount surrendered to the DTI and other movements on the General Fund are shown in note 12.
The Agency achieved its key financial target for the year, as stated in note 3. Performance against other measures is listed on pages 20 and 21 of the Annual Report.
Review of activities
The activities of the Agency and the development of its business are reviewed in the preceding pages.
The Agency's income rose again in 1999/2000 as a result of charging for licences on the basis of spectrum management considerations, rather than matching income to costs. The new basis is designed to promote optimal use of the radio spectrum. The Agency does not retain the cash value of its surpluses.
The first auction of spectrum licences was in progress at the year end. The deposits of the thirteen bidders for the five Third Generation Mobile Services licences are shown in the balance sheet. The auction concluded in April 2000, with bids totalling £22,477,400,000. The licences are for a period of 20 years. The income will be shown in the accounts for 2000/01 and subsequent years. The licence proceeds will be remitted to HM Treasury as soon as they are received. See note 17 for more information.
The joint venture company, Radio Spectrum International Consulting Ltd known as RSI, traded profitably in its business of providing the resources required to meet the Agency's IT needs. RSI is also trying to build on the Agency's international connections by providing consultancy services to overseas administrations. See note 9 for details. The Agency's share of RSI's dividend for the year ended 31 December 1999 was £240,600.
During the year the Agency implemented a new electronic licensing system. The accounting system project was concluded with the introduction of a sales ledger which is linked to the licensing system. These systems will improve the Agency's efficiency in handling income and debtors in due course.
The Agency's headquarters returned to South Quay, Docklands in August 1999, marking the end of three and a half years exile in temporary accommodation following the destruction of the South Quay offices by an IRA bomb in February 1996. The return also sees the conclusion of the accounting arrangements which were required to reflect the costs of the disaster, and their funding by the DTI and the Agency.
There are no other special factors that affect these accounts.
Fixed assets
The changes in fixed assets are detailed in note 8 to the accounts.
The Agency continues to invest heavily in IT to improve its business efficiency.
Research and development
The Agency's programme of research and development covers a wide area of activity and responsibility within the Agency. It is focussed on the fundamentals of radio propagation and support for the Agency's standardisation and specification programme. Research is intended both to extend the usable spectrum, as new technologies develop, and to make greater use of existing spectrum through sharing and more efficient modulation/coding techniques.
Future developments
The new spectrum pricing powers granted by the Wireless Telegraphy Act 1998 will be implemented over a number of years. The Agency's licence income will rise in relation to expenditure as the programme introduces spectrum pricing based charges to all business sectors. Further auctions will be used for new regional or national services where appropriate, subject to decisions by Ministers.
The Agency is considering the effects of the introduction of the euro. Resources would have to be spent on publicity and staff training, but the costs would not be significant in terms of the overall budgets. The current accounting system is designed to handle the euro with minimal modification.
Management Board
The Chief Executive is responsible for the day-to-day running of the Agency. He is assisted by the Agency's Management Board, which comprises the Chief Executive and Directors. Their names and photographs are shown in the Annual Report, and their remuneration is disclosed in note 4.
Steering Board
The Agency's effectiveness and efficiency in performing its functions are monitored by the Steering Board, whose members are appointed by the Minister. The membership of the Agency's Steering Board since 1 April 1999 has been as follows:
Chairman:
Mr Jonathan Spencer
Director General, Industry, DTI
(appointed 16 February 2000)
Mr Alastair Macdonald CB
Director General, Industry, DTI
(resigned 16 February 2000)
Members:
Ms Jane Tozer
Managing Director, JET Consulting
(appointed 22 November 1999)
Mr Bill Dennay
Consultant, Quantel
Mr David Edmonds
Director General, Office of Telecommunications (OFTEL)
Mr Rob Meakin
Director, GEC Group
Mr David Hendon
Chief Executive,
Radiocommunications Agency
Mr William Macintyre CB
Director, Communications and Information Industries Directorate, DTI
Mr Hugh Savill
Director, Resource Management, DTI
(appointed 16 February 2000)
Mr Jonathan Phillips
Director, Finance and Resource Management, DTI
(resigned 16 February 2000)
Members of the Steering Board who are not civil servants are offered fees of £4,000 per annum, and reimbursement of reasonable travelling expenses. Members who are civil servants do not receive fees.
Supplier payment policy
In line with the CBI code and the Government's commitment on prompt payment of bills, the Agency aims to pay valid invoices within 30 days of receipt or as agreed with suppliers. In 1999/2000, this was achieved for 100% of invoices.
Disabled persons
The Agency's policy is to promote equal opportunity for all, regardless of disability, subject only to capability and suitability for the post in question. Wherever possible, staff who become disabled during employment are provided with an alternative post which makes use of their expertise, should this be necessary.
Equal Opportunities
The Agency is committed to the principle of equality of opportunity. Being fair to people is at the heart of that commitment. The aim is to ensure that all employees and job applicants are treated equally regardless of their gender, marital status, race, colour, ethnic or national origin, nationality, sexuality, disability, age, religion, employment status or trade union activities. Our policy is in line with the DTI policy and builds on the statutory obligations of employers under the Sex Discrimination Act 1975 and the Race Relations Act 1976 and the Disability Discrimination Act 1995. The Agency has a programme of action to implement this policy.
Employee involvement
The Agency encourages teamwork and communication between staff at all levels in the organisation. Business and other issues which may be of interest or concern are brought to the attention of staff at various levels in a variety of ways.
There is a continuing dialogue, both formal and informal, with trade union representatives.
The Agency achieved Investors in People accreditation in March 1999, and was successful in its application for re-accreditation this year.
David Hendon,
Chief Executive
3 July 2000
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