90. I have no problem whatsoever with the idea of the police having the most up-to-date and relevant equipment available to them at reasonable cost. I can remember three years ago the Deputy Director of the FBI complaining that the international drug cartels and the international crime operators had better technology even than he had available to him at that stage. More and more of the crime that matters to the public is nationally and internationally based. So we have to look at a wider perspective than just the Bobby on the beat and the local burglar. I start off supportive of the general proposition, particularly as we previously went through the situation where the Met decided to computerise and forgot to arrange for each division's computers to talk to the next division's computers. I can understand the need for interoperability. What I do find difficult to understand, reading the report, is why this project is based on 19 years. Why 19 years, why not 20 years, why not 15 years or indeed with the rapid rate of change in technology, why not fewer than 10 years?
(Mr Webb) The project is actually based on 15 years but the 19 years allows for the two-year run-in and the two-year run-out. The service is being provided to each of the forces for a block 15 years. We went for 15 years because having examined the other options that seemed reasonable. Included in the project cost is an allowance for technology upgrades during that period, but the rationale of going for the version of technology we went for, was the fact that we understood a pretty stable development path, enhancement path as far as that was concerned. To address one of the issues you raised about security, the system itself comes as standard with encryption. Therefore all radios provide a level of encryption. It is a very good level of encryption and has already in service identified the fact that it has been recognised by the criminal fraternity that the messages are now encrypted.
91. Looking as a layman at the incredible rate of change just in our mobile phones over the last five years, the rate of technological change in this area seems to be accelerating if anything. What is the nature of the guarantee you have on technological upgrade? What is your criterion going to be as to whether you are getting the most up-to-date equipment? Who judges under the contract?
(Mr Webb) The contract is run and monitored by PITO, in fact we are constantly examining what is being used by forces and what technology is available. We would have to work closely with both the Police Service and the supplier of the service to ensure that we were getting up-to-date technology. With all of these areas, obviously we would want to ensure that there was going to be some business benefit in terms of introducing new technology. What we do not want to do is to be in a situation where we are just introducing the technology for its own sake. We would be examining that constantly throughout that 15-year period.
92. It is a very unforeseeable area, is it not? The risk cost of technological progression must be very considerable.
(Mr Webb) They are and in fact that is always the case in terms of watching what is happening with technology and ensuring that you maintain to current standards and to current developments in technology in the domestic sector. We would have to monitor that constantly and ensure that there was an upgrade path.
93. Looking over a 15-year period and looking at the rate of change and looking at the risk element in that, how are you able to come to the conclusion that the rate of return is 17%?
(Mr Webb) In that 17% a fair degree of risk was built in. Bear in mind that it is the responsibility of O2 to deliver the technology upgrade, therefore recognising that was part of the risk they built into that assessment.
94. Looking at page 12 and the services it says Menu Exclusive Services "The guaranteed handheld coverage . . . will meet only some of the force's need for this service To meet its requirements for guaranteed handheld coverage, the force will purchase this additional coverage directly from O2". What protection do they have, since they are a captive market, that the prices they will be charged for the extra facility will be reasonable and competitive?
(Mr Webb) Those charges are guaranteed within the contract.
95. They are guaranteed within the contract indefinitely, right through the life of the contract?
(Mr Webb) Yes.
96. Does the same apply in the diagram below which says some forces require to operate inside buildings and again they can purchase guaranteed in- building penetration of Airwave from O2?
(Mr Webb) That is right.
97. That is also covered.
(Mr Webb) That is right.
98. We are not in a situation where we could be held over a barrel by O2.
(Mr Webb) No. We are providing a general service here but it was recognised that in a number of areas police forces may wish, where they operate in large shopping centres or in airports or underground areas, to have additional coverage and that was provided for them.
99. What is built into the contract to ensure not only that those costs are fair in relation to the cost which goes on Airwave, but also are value for money in terms of what in this evolving technology and evolving market could be available to carry out these add-on functions from other suppliers. Is there any protection about the marketplace developing and O2 not developing as fast as these suppliers?
(Mr Webb) The current programme is one of extending the Airwave coverage into these areas, assuming that is what the police force wants, to have a level of coverage within buildings with their existing hand-held radio equipment, therefore the assumption is that they would want to use the same technology everywhere. They would not wish a terminal for one requirement and a totally different one if they are going into a building. They would want to use the same terminal for everything.
100. How are we protected against a lower cost competitor appearing who can provide these extra facilities at a considerably lower cost?
(Mr Webb) If any new technology or new suppliers came onto the market we would always be constantly examining the arrival of those and benchmarking against them compared with our own costs.
101. How is that protected in the contract? How is that allowed for in the contract?
(Mr Webb) There is a benchmarking provision in the contract which allows our staff to address these issues with O2 and if we believe they are no longer competitive, it is something which O2 would have to review.
102. Are there penalties in place if they fail to review, or do you have freedom in so far as the options are compatible technologically to go and use an alternative supplier if O2 were not able to compete?
(Mr Webb) No, not within the current contract.
103. So there is no real incentive on them.
(Mr Webb) There is in the sense that, if they were proving to be uncompetitive in that area, we have the ability to apply some pressure to ensure that they bring their prices into line. Bear in mind that we are actually paying them for the core charge.
104. What pressure can you bring in reality? They have the contract. We have been through this with the Passport Office and a contract was drawn up with them and their supplier left them with absolutely no legal armoury at all and no real penalty clauses. All they got back was one fifth of the total loss because of computer failure and that was given a couple of weeks before a hearing before this Committee and was done as a concession. It was not done as a legal requirement. How watertight do you think your contract is?
(Mr Gieve) It is not completely exclusive. If Airwave falls down or cannot produce a good enough service, the police authorities can buy another one. There is that fallback position. Obviously Airwave have invested very, very heavily in this technology and we believe it is going to produce an exceptional service. We have not given away our rights ever to use anyone else.
105. We can see all the advantages of interoperability and I am the last to knock them, but the opposite side of the coin is that if someone did find a way of jamming the system, they could do so throughout the country or anywhere in the country, could they not, because of the single operating system? What assurance do you have that current encryption will continue to be adequate against the attacks from organised well financed criminals?
(Mr Asque) On encryption, the basic system which is being provided has a level of encryption which will mean that the casual listener cannot listen to the system which is in itself a big step forward from the current systems where people can directly listen to them. That is one aspect. Also, for certain specialist users who require an additional level of encryption that can also be provided on an end-to-end basis. So there is more than one level of encryption, depending on the type of user. That can be developed as scenarios develop over the years. This is a bearer and you can change parameters over time to provide different facilities. Encryption is something which can be developed to meet any threat which may come along. It is flexible enough.
(Mr Parris) We are required to ensure that our security and our encryption are accredited by the CESG which is the Government's approved body in this regard. We have an obligation to meet their stringent levels of security and encryption.
106. Mr Gieve, this is specifically to you because of Home Office responsibilities in relation to terrorism. You did say that since 11 September you have become increasingly conscious of a need for interoperability between the emergency services, but the fact is that your department, like your counterparts in the United States and probably in the other Western countries, has been conscious of the risk of biological and of chemical attack for some years. Why is it only after 11 September, which was an attack of neither form, that you became so
conscious of the need for interoperability between the services, whereas it is quite clear from this report that no priority has so far been given to it?
(Mr Gieve) On 11 September, you are quite right that we have known there was a risk of major terrorist attack for some time, but this was the first one of that scale or of that nature in America or indeed elsewhere in the Western world. Yes, we have thought it right to take time off after that and think whether this means that the previous requirement which we had set out for a degree of interoperability between the Fire Service and so on is right or whether we want more. That is what we are doing. It may be we could have set different criteria a few years back than we did; absolutely. But life goes on and you have to review constantly in the light of experience whether your past judgements were right and that is what we are doing now.7
107. Way before 11 September, the Secretary of State was saying that there was a danger not just of a single but multiple terrorist attacks using sophisticated modes of attack. We were aware of that as well, so why is interoperability between the services only now emerging as a priority?
(Mr Gieve) It is not emerging as a new issue.
108. But it was not provided for in this.
(Mr Gieve) We have been aware of this issue and
in most emergencies the emergency services have to communicate with each other. Something like the King's Cross fire was an example which brought that home because the communications did not work well under that. We had a report which set down conditions which we are trying to meet. It is not a brand new subject, but nonetheless experience in New York and the scale of that disaster has caused us to look again at it. You say that this has not ensured it. I take it what you mean is that we could have locked the Fire Service in to the same national procurement as we launched for the police. I do not think we could. It is a local service where we pay no specific grants for technology to the fire authorities.
109. You could have done with the Ambulance Service.
(Mr Gieve) We could have done for the ambulances but we could not for fire. Secondly, we had to take a judgement at the time whether we should insist that only one procurement was done for all emergency services and Ministers back in the mid-1990s took the view that they were not so confident that that was the only solution that they should do so. We are looking at that again. I do not think we are likely to conclude that everyone must take Airwave. We may conclude that whoever does provide some technology for the ambulances and fire has to make it meet interoperability requirements.
110. The feature of 11 September in a way was that it was simpler in one respect in that it was a focused mass attack. You as a department, like your counterparts have been preparing for years for types of attack which are spread inevitably with bacteriological or chemical weapons. Therefore the problems of confusion in the emergency service would actually have been greater if an attack of that sort had taken place, yet you still do not seem to have addressed it and not even at this stage do you seem to be very seriously addressing it.
(Mr Gieve) We are seriously addressing it and we have before. You are absolutely right, we do contingency exercises in government involving all the emergency services on a range of scenarios and we set up contingency planning arrangements to deal with a wide range of emergencies and terrorist attacks of different sorts. I was engaged in one just a month ago. We do take this very seriously and we do set up command arrangements which allow us to coordinate the various services concerned. That is going on. We take it very seriously and we did not start on 11 September. Even there we do have to review whether the experience of something as big as 11 September has caused us to revise our earlier opinions and in some respects I am sure it will, because it was a very big and unexpected event. In terms of this contract, saying that you need to have co-ordination of the emergency services and indeed the army and other things as well in emergencies is not the same as saying we have to insist that every fire authority buys the same radio system as every police authority. That was a decision that we were taking in 1996.
111. Or the ambulances.
(Mr Gieve) Or the ambulances. It is not the same. To say we have to co-ordinate the Ambulance Service, the Police Service and the Fire Service does not lead automatically to the view that all the ambulances and the police and the fire should all operate off exactly the same technology. That is an option and we started with the option that we do fire and police together; in fact in the end we have done police. That is still a massive contract and a massive risk because we still do not have Airwave to the police. People have talked about the degree of risk in this contract. There is still risk. PITO and O2 have it working in five forces, but we still have not shown that it can work as expected in major metropolitan areas. We think we are going to do that over the next two years. There are still risks involved and all of that is part of the decision-making on how many eggs to put in the basket. I am aware that on the one hand I am being accused of putting in too many by getting all the police force into the contract. What you are saying is that we do not have enough because we should have foreseen terrorist attacks and put fire and ambulance in. It is a subtler judgement than all or nothing. It was a reasonable judgement in 1996 not to put fire in, but we are reviewing again, as we shall continue to do, what degree of interoperability is genuinely required.
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