Posted: 4 September, 2013 at 2:59 pm

Campaign win as government U-turn on rip-off rate phone lines

Campaign win as government U-turn on rip-off rate phone lines

MP John Healey has won his 18-month campaign to stop the government using rip-off rate phone lines.

At a hearing of the Public Accounts Committee (PAC) in the Commons on Tuesday, Department for Work and Pensions permanent secretary Robert Devereux said they would bring in 0345 numbers where they currently have 0845. This would make calls to DWP free or cheaper for most people, costing no more than a local landline rate instead of up to 41p a minute.

Cabinet Office permanent secretary Richard Heaton said they had begun working with departments and would bring forward a new government approach within a few weeks.

The U-turn is a victory for Mr Healey who has campaigned against the use of 0845 numbers by government departments and GPs.

And it is a humiliating climb-down for Work and Pensions Secretary Iain Duncan Smith who, just a few months ago, dismissed Mr Healey’s arguments and said the costs to customers were “beyond DWP control.” Mr Duncan Smith insisted on pressing ahead with high-cost lines, even making new numbers for Personal Independence Payment and Universal Credit 0845.

Mr Healey’s report, ‘The Telephone Tax’, published in May, revealed nearly two thirds of government services have 0845 phone lines, including Disability Living Allowance, Carers Allowance, Jobcentres, Social Fund (for crisis loans), Pensions Service and the Student Loans Company. His dossier of evidence persuaded the National Audit Office (NAO) to launch an inquiry, which reported in July, and now the PAC hearing.

He said today: “The government has promised an end to high-cost lines that rip off the most vulnerable and poorest in our country. Now no one will pay more than if they were calling a local landline.

“This is a victory for all those who are put off from seeking the help they need and are entitled to because they can’t afford to spend a big chunk of their tight budget making the call. The Government’s widespread use of 0845 numbers is a telephone tax on millions of hard-pressed people who have to use the lines to contact public agencies.”

Much of Mr Healey’s campaigning has focused on the Department for Work and Pensions. His Freedom of Information request in 2012 found more than 80 per cent of their helplines – used by the sick, elderly and vulnerable – were 0845.

Mr Healey added: “I welcome the government’s decision but they should have switched years ago.

“The Cabinet Office has admitted there has been no policy or activity on this for three years, since guidance issued under Labour in 2010.

“Callers will feel aggrieved that the government have ploughed on with this rip-off policy even though they now admit they can make the change to 03 quickly and cheaply.

“While promising a switch to 03 is a positive step I would like the government to go further. I want to see calls to public services made free across the board, or at least for those likely to be under the most pressure.”

The NAO’s report said switching all high-rate lines to 03 would save callers £29m a year and cost government £7m; while a move to 0800 would save callers £46m and cost government £21m.

Mr Devereux told the PAC that DWP pays £80m to BT for its phone system and switching to 03 would cost about £1m which was “neither here nor there.”

Dialling 0845 is particularly expensive from a mobile but a switch to 0345 would save those calling DWP from a mobile £20m a year. People on lower incomes are more likely to rely on their mobiles to make calls.

PAC chair Margaret Hodge described the high cost lines as “a racket” and said it was “shocking” that people had to call 0845 numbers to access crisis loans, victim support and bereavement services.

She told the PAC that Mr Healey had been a “great campaigner” on the issue, and added today: “Well done to John Healey in winning this campaign. It is a brilliant example of what a campaigning MP can do through Parliament to get real change which will make a big difference to the everyday costs for millions of ordinary people.”