On 13 December 2011, Mike Penning, Parliamentary Under-Secretary of State for Transport, with responsibility for DVLA services in GB, announced in the House of Commons, public consultation on a document titled “Transforming DVLA Services”.

The document contained five options for the future delivery of vehicle licensing services:

• Option 1- Do Nothing.
  • Option 2 – Channel shift of transactions and services and closure of all network offices at the same time.
  • Option 3 – Phased channel shift of transactions and services with two stage closure of the network, reducing from the existing 39 offices to 16 by autumn 2013 And closure of all offices by March 2015.
  • Option 4 – Phased channel shift of transactions and services followed by phased closure of all offices.
  • Option 5 – Phased channel shift of transactions and services, maintain a network of smaller offices co-located (where possible) in alternative government estates property.

Notwithstanding the fact the document was issued for consultation, the Under Secretary of State announced – “As a result of these proposals I expect the DVLA to centralise services at its Swansea offices and to deliver those services electronically and in partnership with others.  To this end, the DVLA will withdraw from its network of expensive, regionally located offices by the end of 2013.”

Impact in Northern Ireland

These proposals will have a direct impact on Northern Ireland.  This is because the Driver and Vehicle Agency (DVA), an agency within the Department of the Environment, is responsible for the delivery of vehicle licensing services to this region on behalf of DVLA.  This work is undertaken under the terms of an agency agreement, with DVLA providing the funding and policy direction.

This funding by DVLA has provided for 323 posts in total, to be engaged in licensing services in Northern Ireland.  Of these staff, 263 are engaged whole time in vehicle licensing, with 60 posts engaged in support functions, funded in part by DVA.

Location of posts

The location of local licensing offices is as follows:

• Coleraine – 259 posts.
• Belfast – 23.5 posts.
• Ballymena – 8 posts.
• Omagh – 6 posts.
• Londonderry – 6 posts.
• Enniskillen – 5 posts.
• Armagh – 9.5 posts.
• Downpatrick – 7 posts.

Future provision of service

The favoured proposal is that the work undertaken in local offices in GB and under a service level agreement in Northern Ireland, will be replaced by the renewal of tax discs by both online and telephone services.  It is also proposed that some of the work will be transferred to the Post Office.  This will be facilitated by the enhancement of the GB IT system and the integration of the two currently separate IT systems in place, with the migration of the NI vehicle information to the GB database.

DVLA has a network of 39 local offices in GB, 10 of which also accommodate enforcement operations.  The offices provide over-the -counter registration and licensing services and the processing of Vehicle Excise Duty (VED) enforcement work.

The Under Secretary of State has determined that, “subject to consultation”, Option 4 is the preferred option.  Under this option, the closure of offices and centralisation of services at DVLA’s Swansea Headquarters, would begin after all transactions and services have been migrated.  The estimated timescale for this in GB is June – October 2013.

An Excepted Matter

Vehicle Licensing and the collection of duty is not a transferred matter and there is therefore no legal authority for the NI Assembly to consider providing funding for the retention of service within DVA.

This proposal to close the offices is therefore a political matter which will be decided in GB, albeit with some consideration of the economic impact and following completion of an Equality Impact Assessment.

Concerns on service delivery and impact on local economy

The Public and Commercial Services Union (PCS), which represents the greatest number of staff within DVLA and NIPSA which represents the staff within DVA have common concerns on the consequences of these proposals on the future delivery of service and the adverse impact on the local and wider economy.  Some of these concerns are outlined below -

• Job Losses – the proposals will mean 1,200 job losses in GB, with a consequent loss of 323 lobs in N Ireland.

•  Reduced service levels are inevitable for the public and the motor trade, with the loss of expert, over the counter advice and assistance from highly trained and experienced staff.

•  In a survey of the motor trade in GB, PCS have established that they have significant concerns around such issues as speed of delivery of services and the loss of the collection service provided to car dealers.  The motor trade also expressed concern about the abandonment of  the facility to process “cherished transfers” over the counter in GB –a service still provided in NI and much valued.

•  There were also fears over the security of documents which will have to be posted under these proposals and the loss of local knowledge of experienced staff, who have been cited for their excellent customer care.

•  On an annual basis, the DVA (NI) registers 117,000 new vehicles, issues 1.4m vehicles licences, 229,000 driver licences, 4,000 taxi licences, 550 road freight operator licences, 6,800 road freight vehicle licences, 2,500 bus licences and 200 bus operator licences.  It does this with a customer satisfaction rating currently at 98%.  This customer satisfaction rating is certain to be compromised by these proposals.

•  It is highly doubtful that the current comprehensive service can be replicated by transactions conducted via the internet or at post offices.

•  The loss of the in-house expertise built up within the ranks of the DVLA and DVA public counter staff and back room staff will inevitably lead to a transfer of cost to business.  The motor trade, who rely heavily and beneficially on the current services provided, will have to engage their own clerical staff with sufficient knowledge of the licensing system to replace the service currently provided to them.

•  The accuracy of the vehicles database is ensured to some extent by enforcement via local licensing offices, which collect unpaid Vehicle Excise Duty and arrears of duty, issue penalties for late payment and exercise powers to impose a penalty for failure to give notification of a change in registered owner.  This database is relied upon to ensure compliance with the new policy on “continuous registration” and “continuous insurance” which obliges owners to declare that their vehicle is off the road or incur a penalty if it is detected in use.  Local offices are pro-active in tackling and deterring car crime, for example by noting counterfeit and stolen documents and engaging the police at short notice. The accuracy of the data base is likely to be compromised by centralisation.

•  The vehicles data base contains sensitive information, including addresses, dates of birth, registration plate numbers and credit card details.   Despite the sensitivity of this sort of information, it has been revealed that the IT company IBM has “off-shored” this information in its contract to run the London congestion charge for Transport for London.  This precedent, could pave the way for the Privatisation of licensing services with a clear threat that the vehicles database for the whole of the UK could be similarly off-shored.

•  The loss of over the counter services will have an adverse impact on, amongst others, the elderly, the traveller community, British Forces serving overseas, people who do not have English as a first language and others who rely on a face to face contact.

•  The vehicle licensing service provided by DVLA in GB operated under a trading fund until recently.  Under this regime it was able to retain much of its income from services to fund its administration and various development projects.  It had in fact built up a surplus of £120 million which was subsequently clawed back by central government, who then ordered a further £100 million in savings.  This was not an economic imperative, but rather political decision which has given rise to these proposals.

•  PCS has established that an increase in evasion of duty by a mere one half of one percent would outweigh the predicted savings under this proposal.  There is a reasonable concern that centralisation will have this impact on revenue. The loss of so many jobs to the economy and the transfer of additional cost to business at this time, is simply reckless.

•  Economists engaged by DVA have established that the impact on the local economy will be significant.  They noted that the claimant rate for Coleraine, at 5.4% is considerably higher than the UK average claimant rate of 3.9%.  Indeed all of the council areas in which the DVA has local offices have a higher level of claimants than the UK average.  In their view it was highly unlikely the private sector “would have the capacity to absorb all of those who would be directly or indirectly affected by the net loss of jobs as a result of centralising licensing services”.

•  The loss of jobs would not just affect the public sector.  The “Multiplier Effect” means that there will be knock-on effects on the private sector and a loss of demand in the local economy will mean a loss of jobs there too.  The economists concluded -

“It will not only affect the public sector, it could also have an impact on the private sector, given the multiplier effects. This is likely to be severely damaging to businesses in NI, particularly given the current economic landscape. Given how relatively weak the local labour market is, the timing of this proposal could not be worse and will be extremely damaging to the NI economy.”

 Michael Robinson

Assistant Departmental Secretary

18 June 2012