1. This paper proposes that a Relay Service be established to better meet the telephone communication needs of the hearing impaired and speech impaired members of the disability community. It is proposed that the service be funded by declaring the Relay Service to be a Telecommunications Service Obligation (TSO) under the Telecommunications Act 2001.

Executive Summary

2. This paper addresses the telephone communication needs of severely hearing and speech impaired people, including Deaf¹ people (the affected population). The key points are:

the telephone service communication needs of the affected population are not being met by existing telephone services;
it is recommended that a Relay Service be established to meet their telephone service communication needs and that the network be funded by the telecommunications industry by declaring the service a TSO;
a Relay Service will enable people who have difficulty hearing or speaking on the telephone to communicate using a teletypewriter (TTY) with an intermediary, who in turn speaks to the other person, and to read the incoming reply from the other person on the TTY's display;
the cost of providing a Relay Service is estimated to be about $2 million per annum, possibly rising to $5 million per annum as use increases (excluding the costs of funding the TTYs required to access the Relay service);
the Ministry of Health will fund TTYs for those people who meet current access and eligibility criteria;
further work on TTY access issues in respect of a Relay Service will be undertaken prior to the tendering of the Relay Service;
the disability community considers that requirements should be placed on Government agencies and the telecommunications industry to consult with the disability community on telecommunication issues. However, officials consider that existing consultation requirements are satisfactory.

Background

3. Following the Government's decisions on the Ministerial Inquiry into Telecommunications, the Minister of Communications and the Minister for Disability Issues were requested to report to FIN on implications of access to telecommunications services for people with disabilities in New Zealand, informed by the Human Rights Commission study on a Relay Service, work on the digital divide, and the New Zealand Disability Strategy. [CAB (01) 13/9]

4. The Government's objective for the telecommunications regulatory environment is to ensure the delivery of cost efficient, timely, and innovative telecommunications services on an ongoing, fair and equitable basis to all existing and potential users. The Government's social objective in telecommunications is to ensure delivery of telecommunications services on a "fair and equitable basis" to all existing and potential users. [CAB (00) M 42/4F(1)]

5. The Telecommunications Act 2001 provides for the establishment of TSOs. The purpose of a TSO is to facilitate the supply of certain telecommunications services to groups of end users within New Zealand to whom these telecommunications services may not otherwise be supplied on a commercial basis and/or at an affordable price. The cost of any new TSOs will be borne by telephone service providers, and ultimately reflected in telephone service prices.

Telecommunication Needs of the Disability Community

6. The disability community has expressed a range of concerns over access to and the capability of telecommunications services. The following three issues have been identified by officials as key telecommunication concerns of the disability community:

a Relay Service, which provides conversion between text and voice, is not available for the affected population and they cannot therefore obtain a satisfactory service from currently available telephone services;
an inconsistency between residential telephone service providers in the provision of directory services to vision impaired people. Severely vision impaired Telecom residential customers can access directory assistance for a flat fee of $1.25 per month, while severely vision impaired TelstraClear residential customers cannot.
the lack of a requirement for Government agencies and the telecommunications industry to consult with the disability community before making decisions on telecommunications issues.

The Human Rights Commission

7. The Human Rights Commission (HRC) has considered two long-standing complaints under the Human Rights Act 1993. The complaints alleged that Deaf people are being discriminated against by Telecom because they are denied access to the residential telephone network. The provision of a Relay Service for Deaf people was an issue central to the complaints.

8. As part of its process of considering the complaints, in 2000 the HRC commissioned a study on the provision of telecommunication services for the profoundly Deaf. The study (known as the Fitzgerald report) concluded that a Relay Service was the only solution that could cost-effectively enable Deaf, hearing impaired and speech impaired people to use telephone services to instantaneously communicate with other telephone service users. The HRC also entered into discussions with the telecommunications industry with the objective of obtaining voluntary agreement to introduce a Relay Service. Agreement to such a course of action was not obtained.

9. The HRC has recently reached a final decision on the complaints. Commissioners concluded that there was substance in the complaints, and that Telecom's failure to supply a Relay Service was both directly and indirectly discriminatory. The HRC concluded it was reasonable for Telecom to provide a Relay Service. Because the HRC has been unable to obtain a voluntary agreement to introduce a Relay Service the only option it has available is to enforce its opinion by requesting the Human Rights Review Tribunal to make an order that Telecom provide a Relay Service. The HRC considers that obtaining such an order is likely to be resource-intensive and unlikely to resolve the issue completely or in the near future.

Functionality Required to Meet the Communication Needs of the Affected Population

10. This section assesses the telephone service communication needs of the affected population who cannot use the standard telephone and assesses options for meeting these needs.

11. The number of people who cannot use the standard telephone is difficult to assess. The Fitzgerald Report suggests the number may be anywhere from 14,000 to 70,000. However, Ministry of Health (MOH) officials estimate the number of people in the affected population who cannot use standard telephone services to be around 7000.²

12. The affected population requires telephone services that provide the capability of instant response communication with any other telephone service user in the world. To communicate instantly with any other telephone service user, a severely hearing or speech impaired person needs an intermediary to provide conversion between text and voice. This intermediary could be either a person (relay operator, in the case of a Relay Service) or, potentially, new technologies including computer software applications.

13. The essential telephone service capabilities are:

for a hearing impaired person with unintelligible speech to transmit their communication to an intermediary by a text telephone, and read the incoming text message reply on the text telephone's display; or
alternatively, for a hearing impaired person with intelligible speech to speak (after the call has been established) to the other person, with an intermediary converting the other person's speech to text, which is then read from the text telephone's display; or
alternatively, for a speech impaired person to transmit their communication to an intermediary by a text telephone, and listen directly to the other person (after the call has been established); and
for any non-impaired person at the other end of the telephone to communicate with an intermediary by voice.

Options to Meet the Telephone Communication Needs of the Affected Population

14. The three available options are: retain the status quo; new technologies; provide a Relay Service for the affected population. Any viable options will need to have the capacity to provide instant response communication with all telephone service users (as defined in paragraphs 12 and 13).

The Status Quo

15. The telecommunications services currently available to the affected population comprise: fax communication; mobile phones providing short text communication; and dial-up Internet services providing email and chat room communication.

16. Vodafone advocates the use of text capable mobile phones as a solution to the telephone communication needs of the affected population. Text capable mobile phones, fax, email, and chat room communication do provide additional communication options for the affected population. However, they all have some significant limitations in meeting the required functionality, for example, a significant number of people do not have ready access to text capable mobile phones or email facilities. Accordingly, these services do not provide the capabilities (as defined in paragraphs 12 and 13) required to meet the telephone service needs of the affected population.

New Technologies

17. Voice recognition systems, advanced mobile phones and a number of new technologies such as video conferencing are becoming available that may provide a cheaper and more efficient way of facilitating communications for the affected population. While these technologies are likely to offer improved communications capabilities to the disability community in the future, they are presently not widely available and so cannot provide the functionality required by the affected population (as defined in paragraphs 12 and 13).

The Relay Service

18. A Relay Service enables standard voice telephone users to communicate with people who have difficulty hearing or speaking on the telephone. A Relay Service will meet the essential telephone service capabilities required because a relay provides the required functionality (as defined in paragraphs 12 and 13).

19. A Relay Service will need to provide a 24 hour, 7 day a week service, in order to match the functionality of the standard residential telephone service. There should be no charge for residential users using the service to make local calls. A long distance call charge should apply in respect of national and international calls.

Cost Benefit Analysis of a Relay Service

The Operational Cost of a Relay Service

20. The cost of a Relay Service is dependent on the size of the population accessing the service and the rate at which that population takes up the service. Based on the experience of OECD countries that provide a Relay Service, officials estimate that the annual operating cost of an established Relay Service in New Zealand is likely to lie in the range of $2 to $5 million. Taking into account initial start up costs such as publicity, training and the fact that uptake of the service by potential users will be gradual (because users will need time to become aware of the service and acquire the equipment necessary to access the relay service) it is estimated that the service may cost about $2 million to provide in its first full year of operation. As uptake and usage rises, the cost could increase to $5 million p.a. These estimates assume that Relay Service telephone call usage will be similar to that in other OECD countries. However, it is possible that usage in New Zealand could exceed international trends.

The Cost and Availability of Teletypewriters

21. Users of a relay service will require a teletypewriter (TTY). Standard TTY units typically retail for about $900.

22. The capital cost of a TTY is substantial and could be a barrier to uptake of the Relay Service. However, as demand for access to the Relay Service grows there are expected to be commercial incentives to provide TTYs on a rental basis. To assist in ensuring that a TTY rental option for accessing a Relay Service is made available officials will report back to the Minister of Communications and Minister for Disability Issues on TTY access issues by 30 September 2002.

23. The MOH funds Environmental Support Services (ESS), i.e. equipment, housing modifications, vehicle grants and vehicle modifications, for people who have disabilities. Under existing ESS criteria a TTY could be provided where it is needed to maintain a person in full-time study, training or employment. All applications accepted under the ESS criteria are subject to funding availability. The MOH estimates that demand from people meeting existing MOH eligibility criteria for TTYs (to access a Relay Service) could increase to approximately 700 units over an initial five-year uptake period (at a cost of between $500,000 and $1 million). The Ministry of Health expects to absorb this extra cost.

24. It is possible that a TTY rental option would increase demand for Disability Allowance from Vote: Work and Income, and incur costs to Votes: Veterans Affairs. An assessment of any such impact will form part of the report back on TTY access issues.

Assessment of the Costs and Benefits of a Relay Service

25. The benefits of a relay service include:

the affected population will be able to communicate by telephone with other members of the community. This will enable significantly greater participation in the community, including in the workforce, and benefit the whole community;³
it would address the telephone service related human rights issues for the affected population; and
it is consistent with implementation of government policy for telecommunications services and the objectives of the New Zealand Disability Strategy.

26. The Costs are:

provision of a Relay Service is likely to cost $2 million per annum, possibly rising to $5 million per annum over time (excluding the costs of TTYs);
the cost to users of purchasing or renting a TTY;
the cost to government agencies of funding the purchase or rental of TTYs. These costs are estimated to be between $500,000 and $1 million over the initial five-year uptake period for the Ministry of Health, excluding possible costs to Vote: Work and Income and Votes: Veterans Affairs (which will be assessed and reported on by 30 September 2002); and
a possible disincentive for the users of the Relay Service to use future alternative communication systems. This risk can be managed by use of a tender specification that is technologically neutral, that specifies an initial supply term of 3-5 years, and by incorporating a review of the best means of achieving the required functionality when calling for tenders in advance of the expiry of an existing Relay Service TSO contract.

Conclusions and Recommendation on the Provision of a Relay Service

27. The introduction of a relay service would overcome the barriers that the affected population face in accessing standard telephone services, and would support the Government's objective of providing telecommunication services on a "fair and equitable basis" to all existing and potential users. Officials consider that there are likely to be considerable benefits to the disability community and the community at large from the Relay Service and that the costs of providing the service are modest by comparison.

28. The Minister of Communications and the Minister for Disability Issues therefore recommend that the Government move to ensure that a Relay Service is introduced.

Provision of a Relay Service

29. Three potential mechanisms could be used to fund a Relay Service. They are: rely on the Human Rights Review Tribunal proceedings; government funding; use the TSO funding mechanism in the Telecommunications Act 2001.

30. Reliance on the Human Rights Review Tribunal's proceedings is not favoured as it is not certain that this mechanism will provide funding for a Relay Service in a timely manner. While the telecommunications industry has indicated in consultation that their preferred option is for Government funding to cover the cost of the Relay Service, the Minister of Communications and the Minister for Disability Issues recommend the use of the TSO mechanism. A Relay Service meets the purpose of the TSO mechanism, which is to provide services to groups of end users where those services may not otherwise be provided on a commercial basis or at an affordable price. Use of the TSO mechanism to fund a Relay Service is also consistent with the Government's decision to fund (via the TSO mechanism) the net cost to Telecom of complying with the Kiwi Share Obligations.

Funding by TSO and Implementation of a Relay Service

31. Under this option the Minister would declare the provision of a Relay Service to be a TSO under the provision of the Telecommunications Act 2001. This would provide the necessary funding for the services.

32. Implementation of a Relay Service could be carried out by the following process:

consider and report to Ministers on TTY access issues in respect of a Relay service by 30 September 2002;
develop a detailed Relay Service description in consultation with representatives of the disability community and other interested parties, by 30 October 2002;
complete any outstanding consultation with affected parties as required by the TSO provisions of the Telecommunications Act 2001, by 30 October 2002;
call competitive tenders for the provision of a Relay Service and contract with the successful tenderer (with funding by way of a TSO)⁴ and;
declare the provision of a Relay Service to be a TSO under the Telecommunications Act 2001.⁵

Cost Recovery

33. It is likely that telecommunications service providers will recover their costs of providing a Relay Service across all their telephone services. Telecom will be able to recover a portion of its contribution to the cost of a Relay Service TSO from residential telephone service users. It is estimated that the price of residential telephone service may increase by between $1 to $3 per annum.

34. The Telecommunications Act 2001 prohibits the service providers who fund TSOs from identifying particular TSOs when billing a customer. Customer bills may only state the aggregate cost of all TSOs, without a breakdown of the costs of individual TSOs.

Requirement for Consultation on Telecommunication Service Issues with the Disability Community

35. The Telecommunications Act 2001 establishes:

a Telecommunications Commissioner in the Commerce Commission with powers to resolve disputes between telecommunications industry service providers over access to regulated key services, including the approval of industry codes in respect to such services; and
a statutorily recognised telecommunications industry Forum with the ability to forward codes which have the support of 75% of eligible persons, to the Telecommunications Commissioner for approval.

36. The New Zealand Disability Strategy promotes consultation with the disability community. The disability community considers it should be involved in all discussions undertaken in the telecommunications industry. Submissions by advocacy groups representing the disability community consider that:

the Government should be required to formally consult people with disabilities when establishing a TSO; and
the Telecommunications Commissioner and the telecommunications industry Forum should be required to consult people with disabilities on any telecommunications issues.

Discussion

37. The Telecommunications Act 2001 requires the Minister of Communications to consult with interested parties before declaring a TSO, including any affected members of the disability community. Officials note that in practice the Telecommunications Commissioner will consult people with disabilities where they are likely to have a material interest, before making any decisions. Many of the issues the Forum is likely to consider will raise few, if any, disability issues. Therefore, officials consider that in addition to existing requirements and practices, a further requirement to consult is not necessary.

Directory Assistance

38. There is an inconsistency between telecommunications service providers in the provision of directory services to vision impaired residential telephone service customers. Vision impaired residential service Telecom customers are able to access directory assistance for a flat fee of $1.25, while vision impaired TelstraClear customers pay 50 cents for each national directory assistance call and $1.50 for each international directory assistance call. Advocacy groups for vision-impaired people consider that this inconsistency limits their choice in choosing a telecommunications service provider.

39. MED officials are working with TelstraClear to address this issue.

Consultation on TSO

40. The Telecommunications Act 2001 prescribes that the Minister must consult liable persons and any persons the Minister considers appropriate before recommending an instrument be declared a TSO. Some consultation has been carried out with the telecommunications industry and the disability community. Further consultation to meet the requirements of the Act will be carried out in conjunction with the development of a Relay Service specification, prior to declaring the provision of a Relay Service to be a TSO.

Consultation

41. This paper has been jointly prepared by the Ministry of Economic Development and the Ministry of Health. The Ministries of Justice; Social Development, including the Senior Citizens Unit; Agriculture and Forestry; Veterans Affairs; Te Puni Kokiri, and The Treasury have been consulted on this paper.

Fiscal Implications

42. There are no fiscal implications for Vote Communications. There are fiscal implications for the Ministry of Health under current equipment eligibility criteria: it is expected the costs will be between $500,000 and $1 million over the initial five year uptake period. The risk can be managed by monitoring applications for TTYs as a result of setting up the relay service, as well as incorporating this issue into a planned review in the 2002/2003 year. There may be fiscal implications for Vote: Work and Income for the provision of Disability Allowance to those who rent TTYs, and for Votes: Veterans Affairs. Any such fiscal implications for will be included in the report back on TTY access issues.

Human Rights Implications and Disability Issues

43. The proposals in this paper support the human rights of severely hearing and speech impaired people, including Deaf people, in New Zealand. Provision of a Relay Service potentially raises issues regarding the Human Rights Act (HRA) 1993 and the Human Rights Amendment Act 2001⁶ in respect to the Relay Service and equipment (TTYs).

44. Officials consider that the proposals in this paper relating to the provision of a Relay Service will not raise discrimination concerns under the New Zealand Bill of Rights Act.

45. Ministry of Health officials note that current arrangements determining eligibility for ESS, including TTYs, may raise the risk of a claim of discrimination under the New Zealand Bill of Rights Act. These arrangements target assistance according to employment status. These risks are best addressed through a MOH review of ESS planned for 2002/2003 and could also be considered within the proposed work to be led by the Ministry of Social Development on the development of a framework for equitable and coherent services and support for people with disabilities.

Legislative Implications

46. There are no legislative implications.

Regulatory Impact and Compliance Cost Statement

47. The attached RIS complies with the requirements. The proposal's compliance cost is the time taken by each liable operator to pay for the levy to fund the Relay Service, and is considered to be minimal. Consequently, a BCCS has not been prepared.

Publicity

48. It is recommended that the Minister of Communications and the Minister for Disability Issues make a joint press release (officials will prepare a draft media statement).

Recommendations

49. It is recommended that the Committee

agree that a Relay Service for severely hearing and speech impaired people, including Deaf people, be established as a Telecommunications Service Obligation (TSO) under the Telecommunications Act 2001;
direct the Ministry of Economic Development, the Ministry of Health, and the Ministry of Social Development to report to the Minister of Communications and the Minister for Disability Issues on teletypewriter (TTY) access issues in respect of a Relay Service by 30 September 2002;
direct the Ministry of Economic Development; the Ministry of Health and the Ministry of Social Development, to develop a detailed Relay Service description in consultation with representatives of the disability community and industry and report to the Minister of Communications and the Minister for Disability Issues by 30 October 2002;
note that the cost of the Relay Service is likely to be $2 million per annum initially, possibly rising to $5 million per annum as use increases;
note that the establishment of a Relay Service could require additional expenditure from the Ministry of Health's disability support service budget of between $500,000 and $1 million for the provision of TTYs over the initial five-year uptake period;
note that the establishment of a Relay Service could require additional expenditure from the Ministry of Social Development in respect of Disability Allowance, and from Votes: Veterans Affairs. This issue will be clarified in the report back on TTY access issues;
note that further consultation with the telecommunications industry and representatives of the disability community will be carried out to meet the requirements of the Telecommunications Act 2001 by 30 October 2002;
direct the Ministry of Economic Development to call competitive tenders for the provision of a Relay Service and finalise an agreement for the supply of the service;
note that the tender specification will be technologically neutral; it will specify an initial supply term of 3-5 years; and there will be a review of the best means of achieving the required functionality when calling for tenders in advance of the expiry of an existing Relay Service TSO contract.
note that to implement a Relay Service the Minister of Communications will be required to declare the agreement to provide a Relay Service to be a TSO;
note that the price of residential telephone services which is capped under the Kiwi Share Obligation (KSO) may rise by between $1 and $3 per annum as a consequence of the introduction of the Relay Service as a TSO;
note that existing consultation requirements provide a satisfactory process for the disability community to voice its concerns about telecommunications issues;
note that officials from the Ministry of Economic Development are working with TelstraClear to resolve an inconsistency between telecommunications service providers in relation to the price of directory services to vision impaired residential telephone service customers.

¹The use of a capital D for Deaf denotes a group of people who consider themselves a distinct cultural and linguistic minority.

²This estimate is based on the number of hearing-impaired people with such a severe loss that they would qualify for access to the Relay service, rather than the total hearing impaired population. An allowance based on international patterns has been included for the likely uptake by severely speech-impaired people.

³Relay Services have proven to be an effective method of meeting the telephone service communication needs of Deaf and speech impaired people internationally. Eighteen countries including the United States, the United Kingdom, Australia, and Brazil operate Relay Services.

⁴It is estimated that the tender process culminating in the declaration of a Relay service as a TSO may take about four months to complete.

⁵It is likely to take about three months for the Relay Service to become operational following establishment of a supply contract and subsequent declaration as a TSO.

⁶The Human Rights Amendment Act 2001 requires that Government activities including legislation, policy and practices comply with the New Zealand Bill of Rights Act. Section 19 of the New Zealand Bill of Rights Act states that everyone has a right to freedom from discrimination.

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Printed: 25/11/2009

Access to Telecommunications for People with Disabilities

Contents

Proposal