§ 36. Mr. Arthur Lewis
asked the Secretary of State for Industry whether, in view of the size of the profits made by British Telecommunications and its anticipated fun her increase in profits in the year 1982–83 and the need for support of the Government's policy of containing and reducing inflation, he will formulate British Telecommunications' financial objectives so as to prevent the proposed further increase in telephone charges in April 1983.
§ Mr. Butcher
No. I am, however, considering a change to the financial objective for British Telecommunications for the year 1983–84 in order to reflect equally the need to contain prices, to provide for the industry's investment programme and to encourage efficiency.
§ Mr. Butcher
Although the British Telecommunications Act came into force only one year ago, there has been substantial progress towards the liberalisation of telecommunications.
Mercury has been licensed to run a rival network in competition with British Telecom; this is a unique development and service will start early next year.
My right hon. Friend expects to sign the general licence for value added network services as soon as his expert advisory panel on telecommunications liberalisation are satisfied with its terms. The licence will introduce the most liberal arrangements in the world permitting private enterprise to use the British Telecom and Mercury networks to provide a full range of value added network services.
The supply of apparatus for connection to British Telecom's networks is being liberalised over a three-year period. The first five standards were approved on 14 October. The basic arrangements for independent testing and approval are now in place; BABT is now accepting apparatus for testing. The Marking and Advertising Orders which provide for consumer protection will come fully into force on 1 November. Work on writing further standards is progressing well but the programme has never been scheduled to be completed until well into next year.
The steps already taken by the Government enable British firms to enter new markets directly and are giving telecommunications users the advantages of a wider range of choices and the benefits of competitive pricing. BT is no longer the only route to the market. Moreover the new standards procedure means that for the first time both users and manufacturers are able to participate fully in the setting of objective, minimum standards.
Industry is beginning to respond to the challenge of liberalisation and there has been a gratifying response from small firms. We are determined to ensure that the consumer has a wide range of equipment from which to choose. And there is mounting evidence that British Telecom is improving its performance in response to competition.
Although substantial progress has been made, I am exploring actively the scope for speeding up the 137W programme and a growing quantity of apparatus is being given accelerated approval under special interim arrangements.