Ordnance Survey (Hansard, 22 July 1981)

§ Mr. Heseltine

My aim is to see the Ordnance Survey flourish as an efficient and cost-effective organisation, and to minimise its call on public funds while maintaining the quality of its work, which is widely acclaimed.

The proposals which follow are made against the background of the report of the Ordnance Survey review committee—the Serpell committee—and I am much indebted to it and to all those who contributed to its work.

The previous Government assumed that OS would remain a Government Department, so the Serpell committee report considers no other structural possibilities. My own view is that we should consider the long-term future of the survey against the full range of possible structures, whether inside the Civil Service or wholly or partially outside it, paying particular attention to its relationships with Government and to ways of involving the private sector in its activities. These possibilities are still being studied and I will in due course announce my conclusions, which will be the subject of consultation with all those concerned. In the meantime, the first step must be to give OS the chance to operate effectively as a free-standing trading organisation, whose performance can be judged in a commercial framework. I therefore propose, with the agreement of my right hon. and learned Friend the Chancellor of the Exchequer, that a trading fund should be set up for OS with a published trading account. An order to put this into effect will be presented to Parliament as soon as practicable. Under the trading fund, the cost of all that work which Government commission from OS in the national interest and which is not chargeable to individual users—public or private—would be financed by way of a contract between OS and the Department of the Environment, instead of by the OS Vote Account as at present. As a basis for the contract OS will prepare, for my approval, a programme specifying in detail the work to be undertaken and the non-Government revenue which it expects to receive. I shall expect the programme prepared by OS to have regard to the recommendations of the Ordnance Survey review committee.

The trading fund proposals will not affect OS' primary function as a national mapping agency, or the Director-General OS' continuing responsibility for advising me on all matters relating to topographic surveying and mapping in Great Britain.

Pending parliamentary approval to the trading fund, I have given the Survey a new financial and operating remit for the immediate term, to replace the present revenue-expenditure objectives which were set in 1977. OS will seek to achieve the following targets: 128W

(a) to increase from 25 per cent. to 30 per cent. the proportion of costs recovered on large-scale information and on the 1:25,000 series;
(b) to obtain maximum net revenue and at least full cost^* recovery, on the small-scale map and survey information;

and will apply the following rules:—

(c) repayment services to Government Departments to be charged, as now, at full cost;
(d) quotations for other repayment services to be made at a commercial rate and, in any case, at no less than full cost;
(e) charges made to the private sector for the use of archival information should be no different front the charge that is attributable internally by OS for its own use in relevant activities. OS will be encouraged within the above criteria and for purposes requiring the use of its topographical archive, to engage in joint ventures with the private sector on terms approved by me.

Note^*—The definition of "full cost" conforms to Treasury guidance to Departments for the purpose of trading within and outside the public sector. Full costs include direct costs plus an allocated share of overheads which include not only the cash cost borne on departmental vote but also the cost borne elsewhere or notional costs such as superannuation contributions, insurance and interest on capital.

Apart from the issues discussed above, the Serpell committee's recommendations dealt with certain particular issues on which decisions need not await consideration of the detailed programme referred to above:—

(a) The committee recommended measures for keeping the OS up-to-date in rapidly advancing technical fields. I accept that this is desirable and will expect proposals for continuing the initial phase of the digital data base development strategy recommended by the committee to be carefully and sympathetically considered for inclusion in the first negotiated OS programme. But the pace of innovation must be tempered by the available resources;
(b) the committee recommended that responsibility for the national non-intensive record of archaeological sites should be transferred to the three Royal Commissions on historical monuments for England, Scotland and Wales, which have offered to take on the task. The Government accept this recommendation in principle and, subject to a satisfactory solution to the administrative problems involved, including the transfer of staff. Together with my right hon. Friends the Secretaries of State for Scotland and for Wales and with my right hon. Friend the Prime Minister's approval, I shall, therefore, be pursuing ways and means of achieving a satisfactory transfer. There will of course be discussions with the three Royal Commissions and the trade unions concerned;
(c) the committee recommended an early review of the arrangements for managing the Joint Survey Service† with the technical and professional career structures involved, taking into account of the place of military officers in the OS. This will be set in hand, in collaboration with the responsible Ministers, as soon as possible.

Note†—The Joint Survey Service is a body of civilian surveyors set up in 1968, mainly of officers with overseas experience, administered jointly by Ordnance Survey, the Directorate of Overseas Surveys and the Directorate of Military Survey.