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One of Ofcom's roles is to manage the radio spectrum so as to ensure that it is used in the most efficient and effective way for the benefit of the UK. Our statutory duties with regard to our spectrum functions are set out in the Wireless Telegraphy Act 2006 (WT Act) and the Communications Act 2003. These include having regard for availability and demand for spectrum, its efficient and economic use, and a number of other duties.

The WT Act empowers us, amongst other things, to authorise the use of the radio spectrum and set fees for the licences we issue. This income from licence fees is passed onto the Government via DCMS who deduct the grant payment made to Ofcom for Spectrum Management and pass the remainder to the appropriate Consolidated Funds. Ofcom is granted funds to cover our spectrum management operating costs in the form of grant-in-aid from the Department for Digital, Culture, Media and Sport (DCMS).

In 2011-12, we developed a cost allocation methodology to refine our understanding of our spectrum management costs.  We consulted on this methodology in 2013/14 which puts in place a robust and transparent process that attributes both direct and indirect Spectrum Management costs (e.g. spectrum policy, licensing, interference and enforcement, international representation and coordination, and overheads including ICT and property), as published in Ofcom's Annual Report, across all spectrum licence classes.

Spectrum management costs attributable to spectrum licence classes, and the licence fees collected in years where we have carried out a cost allocation exercise are published below.