By Vivienne Russell
10 November 2010
The telecommunications watchdog has saved £23m over the last five years, government auditors have found.
But in a report published today, the National Audit Office said that although Ofcom was doing more with less, it was not possible to conclude whether it provided value for money.
‘This is because with its complex remit across the telecommunications sector, it needs a better articulation of the intended outcomes of its activities and how its work achieves these outcomes,’ the NAO said.
An analysis by the auditors found many improvements in the communications market. For example, there is better choice and quality and prices have fallen. But it identified three areas where Ofcom could do more: mobile phone service agreements; telephone landlines; and internet service providers.
Most of Ofcom’s stakeholders were satisfied that the watchdog consulted well, but 44% said it did not then act speedily.
The frequency of appeals against Ofcom’s regulatory decisions were another cause for concern, costing the watchdog more than £1m a year since 2007/08.
NAO head Amyas Morse said: ‘Ofcom has reduced its overall expenditure each year since its creation and we have seen many positive indicators in communications markets. In order to demonstrate that it is delivering value for money, however, Ofcom should demonstrate sharper objectives and metrics to better link its costs with the outcome it achieves.’
An Ofcom spokesman said: 'Ofcom is pleased with the NAO’s conclusion that it has delivered more for less and that consumers are benefiting through lower prices, increased choice and quality. As the NAO notes, Ofcom is 27% cheaper in real terms than its predecessors. Ofcom has recently set out a plan to deliver an additional 28.2% savings, meaning that overall savings will exceed 50%, delivering substantial savings for taxpayers.
'Ofcom has maintained a rigorous grip on costs resulting in six consecutive years of real terms budget reductions. Ofcom’s budget and performance measures are contained in its annual reports, which are approved by the NAO and we take great care to publish and report on a full range of outcomes which matter to consumers and we are confident that our work has delivered clear benefits across the communications sector.'
