Posted: 18 July, 2013 at 3:29 pm

John welcomes watchdog call for government to stop using high cost phone lines

John welcomes watchdog call for government to stop using high cost phone lines

The government should stop using rip-off rate numbers for phone lines used by vulnerable people, the national spending watchdog has found.

The National Audit Office (NAO) report published today found half of the government’s most expensive phone lines serve those on low incomes, the elderly and disabled.

The NAO inquiry was launched in response to MP John Healey’s direct request as part of his 18-month long campaign against the use of 084 numbers, prompted by a complaint from a constituent.

Last year the Labour MP found 87 per cent of the Department for Work and Pensions’ (DWP) phone lines are 0845, costing up to 41p per minute.

Earlier this year Mr Healey published a report, ‘The Telephone Tax’, revealing for the first time the scale of use of rip-off rate numbers across government. Nearly two thirds of department and agency phone lines are high cost, and the Department for Transport made £2.5m from phone calls since 2010.

Today’s report by the NAO reveals the DWP received 100 million calls last year – 70 million to 0845 lines. The benefit enquiry line was busiest and calls lasted nearly 10 minutes on average. So each call could add £4 to the phone bill of people on very tight budgets.

The inquiry concluded changing high cost numbers to Freephone or 03 would save callers more than the cost to the government. Switching to free numbers – as Mr Healey has called for – would save the public £46m compared to the cost to government of £21m. Ministers have previously said the cost to DWP would be £12m.

Mr Healey said: “This report shows the wide extent of unfair phone charges and how the government is making the poorest people pay most to access essential public services.

“For the year-and-a-half I have been campaigning on this the government have shown no understanding of the problems they are causing people on low incomes, the elderly, the disabled. Meanwhile dozens of people have contacted me to say they’ve been left with sky high bills and real financial difficulties.

“They have no choice but to make these calls – to get information and help, change details, make claims – but to do so they are being charged rip-off rates by the government, who are supposed to be helping them.

“It is a scandal and, as the NAO has said, it simply has to end. Making calls to DWP free would cost £12m. That’s a tiny fraction – 0.007 per cent – of the DWP’s £167 billion budget.”

The NAO recommended:

• Departments should stop using higher rate numbers for services that support vulnerable households.

• Departments should improve access to low cost alternatives, such as call back.

• The Cabinet Office and departments should establish clearer policies about charging for telephone calls.

• Departments should know how much telephone companies are making from high cost lines and be open about any benefits they receive.

The report found:

• The Government uses higher rate numbers “extensively” – a third of central government lines. John’s wider analysis of government departments and agencies found they were used in two in three cases.

• Last year central government handled 208 million phone calls, most (63 per cent) to higher rate lines.

• People spent £56m on calling high-cost lines.

• Callers spent 880 million minutes on higher rate calls, including 402 million minutes on hold. This wait cost them £26m.

• Half of all higher rate lines (59 out of 120) serve vulnerable groups, including several benefit lines and the Redundancy Payments Service Helpline. This goes against 2010 Cabinet Office guidance, which states it is “not appropriate” to use higher rate numbers when dealing with people on low incomes or vulnerable groups.

• Departments do not receive a ‘revenue share’ income from using higher rate numbers but many receive a reduction in the cost of other services instead.

• Departments do not know what profit telephone companies make from 084 calls to their numbers, which is also against Cabinet Office guidance.

• Switching from higher rate numbers to 03 would save callers £29m a year and cost government £7m, while changing to Freephone would save callers £46m and cost government £21m.

• Callers do not get a better service from higher rate numbers and many are put off using them altogether.

• The Department for Work and Pensions spends over £150m a year on its telephone contract and says it negotiated a £2m reduction as a result of giving up revenues.

Amyas Morse, head of the National Audit Office, said today:

“Callers do not receive a better service from higher rate numbers and many callers are put off calling government phone numbers altogether. The most vulnerable callers, such as low-income households, face some of the highest charges.

“Each department needs to take a clear approach to using higher rate numbers and protecting vulnerable callers, and improve their understanding of how to get the best value from telephone services for both callers and taxpayers.”