DWP agencies such as JobCentre Plus and the Pension Disability & Carers Service use non-geographic telephone numbers to provide a better service to callers making enquiries about their benefits and other services.
All of these are currently "Business Rate" 0845 numbers, which are charged to callers at premium rates (see below). Normally this premium is used to provide a subsidy to the organisation using the number.
In a written answer on 25 January Chris Grayling, Minister of State at DWP, confirms that there are "no savings from the use of non-geographical telephone numbers".
There is therefore no good reason why the DWP could not migrate immediately to the use of "Geographic Rate" non-geographic 03 numbers, which impose no "Service Charge" on callers. This could be done most readily by initially offering the equivalent 0345 number for every 0845 number as an alternative. This would avoid the need to change existing publicity - callers could simply be invited to substitute a "3" for the first "8" in the number to save money on their call.
If there are no savings from use of 0845 numbers, then clearly it would not cost the DWP any more to use 03 numbers. (That is the only logical meaning that can be applied to the statement from Mr Grayling! - if one assumes that it is accurate and truthful)
If the DWP honours its promise to always call back to those who pay more to call a 0845 number, then it is likely that the 0845 numbers actually end up costing the DWP and the taxpayer (as well as the service user) more, rather than simply offering no saving.
The DWP gave up a revenue share benefit of £500,000 per annum in 2008 (see this written answer), but did so without changing its numbers, so this was of no benefit to callers.
The long overdue switch to 03 numbers must be implemented immediately.
The following table shows what it costs users of common telephone services to make average duration calls of 4 minutes to DWP agencies on 0845 numbers. Typical call durations (charges are generally rounded up to the next minute) are given in this written answer. The rates used are from current published tariffs, based on information assembled by Ofcom.
4 minute call cost
Assuming compliance with the terms of the call plan (penalty charges are otherwise incurred on 01/02/03 calls)
Assuming a package that allows for landline calls (penalty charges are otherwise incurred on 01/02/03 calls)
01/02/03 call rates are commonly lower where a top-up package is acquired
The DWP telephone service providers receive a benefit of around 8p per 4 minute call to a 0845 number. Normally this would be used to offset the cost of the facilities provided, however Mr Grayling is adamant that no such saving is being made.
The higher premiums charged to callers are explained by the administrative cost of passing on this charge and competition to offer the best rates for normal geographic calls.
The DWP is to be commended for its decision to pay for calls from mobile phones, as well as landlines, to its 0800 numbers, which are used for initial claims. It is quite extraordinary that such an exceptional move was not matched by the much simpler, and apparently cost free, action of adopting 03 numbers for enquiries.
It may however be noted from the table that paying to receive calls by using 0800 numbers, as against using 03 numbers, is only generally of benefit to those with PAYG mobiles. For landlines and contract mobile phones, it is only those with who rarely make calls to Geographic Rate numbers who pay call charges for them. The DWP could have probably saved the taxpayer an enormous sum by adopting 03 numbers throughout and making arrangements to pay only for PAYG calls from mobiles. The only callers who would have been disadvantaged by such an arrangement would have been those who incur penalty charges for calling outside the terms of their contract.