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Business plan consultation 2015/16

09 December 2014, Jo Prowse, Acting Chief Executive
PhonepayPlus Budget

PhonepayPlus’ Business Plan and Budget consultation

Our consultation on PhonepayPlus’ Business Plan and Budget for 2015/16 is published today. It’s packed with detail and as it’s one of PhonepayPlus’ major consultations I’d like to flag up some of its key points for our stakeholders.

You can read the full consultation document here. The consultation deadline is 28 January 2015.

Some of the key points to note from the Business Plan and Budget for 2015/16 are:

- The proposed cost of PRS regulation is estimated at £4,444,075 including VAT

- This is a cash-flat budget and is a real terms decrease of 2.3% compared to 2014/15

- Taking into account RPI, we propose an increase in the registration fee from £150 to £155 plus VAT and retention of the current fee exemption structure in support of market growth and innovation

- The adjusted levy is forecasted to fall into a broad range from approximately 0.45% to 0.65%

As I am sure you are aware the market remains in a period of decline, 14.4% down year on year and with further decline this year to date. That said, longer term prospects remain more positive with tangible growth in operator billing and further potential in other sectors resulting from Ofcom’s NGCS changes and emerging areas such as voice codes. 

As PRS’ regulator PhonepayPlus has a role to play in supporting the market and our aim is to reduce our budget where it can be done without compromising our effectiveness. This is why this year’s proposed budget is cash flat and is in real terms a 2.3% decrease on last year. Since 2010 we have reduced our budget by 25% in real terms.

Section Four of the consultation sets out our work plans. We will continue to take a proportionate approach, listening to and working in collaboration with industry and applying the rules reasonably in order to protect consumers and build confidence in the market.

One other issue to note is the levy rate. It is primarily affected by the expected size of the market and the fines and administrative charges collected in 2014/15 which reduce the amount needed to collect through the levy. This year has seen a reduction on the levels of fines invoiced as a result of PhonepayPlus’ increased focus on resolving complaints informally where appropriate to do so. This, combined with market decline, means the levy rate is expected to increase. 

The adjusted levy is forecast to fall into a range from approximately 0.45% to 0.65%. This banding is deliberately broad at this stage in order to accommodate a number of uncertainties such as market performance and likely fine income levels which will be more fully understood once data is available for the final quarters of the year.

I realise that market changes are posing challenges for providers, and this Budget’s real-terms decrease is proposed with that in mind. 

I am keen to gather feedback from all stakeholders on both the business plan priorities and the resource costs. The consultation document has all the information you need to contribute, but if you need any other information or have any other comments do get in touch. 

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