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OFT says more competition for public sector information would generate £1 billion extra annually

While everyone’s been focussing on the Gowers report (into copyright), the Office of Fair Trading – with perhaps questionable timing – has just published its own report into the commercial use of public sector information.

And it thinks there should be more, and that there should be less competition from the public sector information holders (PSIHs).

The key comment comes from John Fingleton, OFT Chief Executive, who said:

‘This is ground-breaking work for the OFT, looking at hidden markets in the economy. These monopoly public sector bodies cost the UK economy £500 million in lost opportunities. Our recommendations will help to make this valuable public asset more easily available for commercial uses which will benefit the economy and consumers.’

£500 million? The taxes on that would easily cover the £50 million in private sector funds that the Ordnance Survey needs, wouldn’t it?

Here’s the press release text:

“The OFT’s market study into the Commercial Use of Public Information (CUPI) is published today, and has found that more competition in public sector information could benefit the UK economy around £1billion a year.

Download a copy of the report (PDF, 707KB).

Examples of public sector information include weather observations collected by the Met Office, records held by The National Archives used by the public to trace their family history, and mapping data collated by Ordnance Survey. The underlying raw information is vital for businesses wanting to make value-added products and services such as in-car satellite navigation systems.

Public sector information holders (PSIHs) are usually the only source for much of this raw data, and although some make this available to businesses for free, others charge. A number of PSIHs also compete with businesses in turning the raw information into value-added products and services. This means PSIHs may have reason to restrict access to information provided solely by themselves.

The study found that raw information is not as easily available as it should be, licensing arrangements are restrictive, prices are not always linked to costs and PSIHs may be charging higher prices to competing businesses and giving them less attractive terms than their own value-added operations.

The report has also found that much of the legislation and guidance which aims to ensure access to information is provided on an equal basis, lacks clarity and is inadequately monitored. As a result the full benefits of public sector information are not being realised.

The OFT concludes that PSIHs should :

  • make as much public sector information available as possible for commercial use/re-use
  • ensure that businesses have access to public sector information at the earliest point that it is useful to them
  • provide access to information where the PSIH is the only supplier on an equal basis to all businesses and the PSIH itself
  • use proportionate cost-related pricing and to account separately for their monopoly activities and their value-added activities so that PSIHs can demonstrate that they are providing and pricing information fairly and in a non-discriminatory manner, and
  • enable the regulator (Office of Public Sector Information) to monitor PSIHs better, with improved enforcement and complaints procedures.

    Implementing these recommendations could double the value of public sector information to the UK economy to £1billion a year, and benefit consumers by providing a wider range of competitively priced goods and services.

    2 Responses to “OFT says more competition for public sector information would generate £1 billion extra annually”

    1. Kilian Says:

      I find the result of the market study very disappointing. “encouraging the PSIH to be more open and accountable” is very little given that the guidelines are already there and are often being breached: The Treasury Fees and Charges Guide already states that the PSIH must distinguish between statutory and non-statutory products. Looking at Companies House’ accounts, this does not happen. Competition law is very clear, but the clauses used by the Ordinance Survey are so restrictive, any private company would be dragged to court immediately over this. The Re-use of PSI Regulations say that the own re-use must be under the same conditions internally as externally, but most PSIHs surveyed seemed to be very lax on supplying all data (like meta-data). These are considerable breaches by the public sector, and I have hoped for recommendations that go further than simply “encouraging” the PSIHs.

      The OFT decided to allow the public sector to provide data as their own re-use cheaper than market rate, thereby encouraging a “natural monopoly” for certain data. Since the OFT recommended charging production costs only (which is against the recommendations of the Fees and Charges Guide), some competitors will not be able to compete downstream. The OFT went a dangerous route with that, because the recommendations are not coupled with an effective supervision process. This means, the OFT effectively noticed bad breaches of the rules, but failed to do anything relevant against it. I am very disappointed.

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