ARCHIVED - Telecom - Commission Letter - 8638-C12-46/01 - BMT - Bad Debt Repayment Plan
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LetterOttawa, 7 May 2003 File number: 8638-C12-46/01 By email
To: Bill Management Tools and Access to Telephone Service Re: Bad Debt Repayment PlanDear Members, On 13 August 2002 Aliant Telecom Inc. (Aliant), MTS Communications Inc. (MTS), TELUS Communications Inc. (TCI) and Bell Canada (Bell) (collectively the ILECs) were requested to submit their comments on l'Union des Consommateurs, the Public Interest Advocacy Centre and the National Anti-Poverty Association (the Consumer Groups) proposal for a Bad Debt Repayment Plan (BDRP) pilot project. This proposal had been sent to Bill Management Tools (BMT) and Access to Telephone Service Committee (BMT Committee) members on 29 May 2002. On 27 August 2002 the Commission received comments from Aliant, MTS, TCI. Bell filed its comments on 28 August 2002. On 10 September 2002 the Consumer Groups filed their reply comments. On 20 March 2003 the Consumer Groups filed further information related to an Hydro-Québec plan that is similar to a BDRP. I note that there is little support from the ILECs in favour of the pilot project. However Bell did indicate that it would be prepared to implement a trial BRDP. Bell stated a number of conditions to its participation, among which was a request for recovery of incremental costs and increased business risks associated with the project through the deferral account established in Regulatory Framework for the Second Price Cap Period, Telecom Decision CRTC 2002-34, 30 May 2002. Given that this request falls clearly outside the activities of the BMT Committee, Commission staff will bring the request and the related issues to the Commission for determination. However, to allow the Commission to make a determination, the record needs to be more fully developed. The questions below are therefore addressed to Aliant, MTS, TCI, Bell, Saskatchewan Telecommunications (Sasktel) and the Consumer groups. Responses to the following questions are to be filed to the Commission and served to all BMT Committee members by 6 June 2003. A. Aliant, Bell MTS, and TCI1. For years 2000, 2001 and 2002, provide the number of residential subscribers that have been disconnected of primary exchange services in your territory because of non payment. 2. Assume that bad debtrefers to a written off final account that has been referred to a collection agency for collection. For years 2000, 2001 and 2002, provide separately the number of residential subscribers that have been re-connected either after having fully repaid their bad debt or under a payment plan. Should you not track such reconnection, provide estimates, with the rationale, including an evaluation of their accuracy. 3. Assume that a residential subscriber's primary exchange service is disconnected with an outstanding account balance of $90 in tariffed services and $250 in non-tariffed services, and that this customer has the highest level of credit risk. Provide all the payment arrangements options and possible schedules for repayment that your company offers and that this customer could obtain in order to be reconnected to primary exchange service. Please explain. Compare these payment arrangements with Sasktel BDRP tariff item 170.10, with regards to its payment schedule, the amount for each payment and other related conditions. 4. What would be the delay (express in days), if any, between that customer's disconnection and the transfer of the customer's account to a collection agency? 5. Assume that bad debtrefers to a written off final account that has been referred to a Collection Agency for collection. Separately, for years 2000, 2001 and 2002, provide the average amount of bad debt for residential subscribers. Differentiate between debt incurred for tariffed services and debt incurred for non-tariffed services. Should you not keep records of such amounts, provide estimates, with the rationale, including an evaluation of their accuracy. B. Additional questions to Bell1. In comments filed 27 August 2002, Bell mentioned an increased business risk should the company implement a BDRP pilot project. Provide all cost estimates relating to this increased business risk that Bell would want to draw down from the deferral account and identify the major cost assumptions to derive these estimates. 2. In comments filed 27 August 2002, Bell mentioned incremental costs that would be incurred should the company undertake a trial BDRP. Provide all cost estimates relating to those incremental costs that Bell would want to draw down from the deferral account and identify the major cost assumptions to derive these estimates. 3. Should the BDRP become a permanent tariffed offering under the terms and conditions contained in Sasktel, Tariff Item 170.10, would the costs incurred by Bell and provided in the above questions B.1 and B2. be different. Explain all differences. C. Questions to Sasktel1. For years 2000, 2001 and 2002, provide separately the number of residential subscribers that were reconnected under Sasktel BDRP, Tariff Item 170.10. 2. Assume that a residential subscriber's primary exchange service is disconnected on 1 November 2002 with an outstanding account balance of $90 in tariffed services and $250 in non-tariffed services. What is the earliest possible date at which he can be reconnected for primary exchange services under SaskTel BDRP? Identify and explain all steps of the reconnection process, from the date of disconnection to the earliest possible date of reconnection. 3. What is the delay (in days), if any, between a residential subscriber disconnection from primary exchange service and the transfer of the customer's account to a collection agency? 4. Separately, for years 2000, 2001 and 2002, provide the average amount of bad debt for residential subscribers. Differentiate between debt incurred for tariffed services and debt incurred for non-tariffed services. Should you not keep records of such amounts, provide estimates, with the rationale, including an evaluation of their accuracy 5. Provide the total number of residential customers who have been reconnected under the BDRP since it was implemented. i) Of this total number, provide the number of residential customers who have fully repaid their debt and the number of those who defaulted. ii) Also, for those who defaulted, provide an estimate of the amount (in percentage and on average) of their bad debt that was repaid when they defaulted? Should you not maintain such records, provide estimates, with the rationale, including an evaluation of their accuracy. 6. Does Sasktel consider the BRDP to be a successful program? Explain. 7. Identify the major difficulties or problems, if any, that Sasktel has encountered with the program? Separate the implementation phase and the regular administration of the program. 8. Identify all means used by SaskTel to inform its customers of the existence of the BDRP? 9. What were the main reasons for which Sasktel has implemented a BDRP? D. National Anti Poverty Organisation, the Public Interest Advocay Centre, l'Union des Consommateurs (the Consumer Groups)1. What are the telecommunications policy objectives to which a pilot BDRP project would contribute to? Explain. BMT Committee members can comment on the answers to these questions by 20 June 2003. Please ensure that where a document is to be filed or served by a specific date, the document is actually received, not merely sent, by that date. Yours sincerely, original signed by
Philippe Tousignant
Follow-up CRTC Order 2000-393, BMT Committee
List of members of the Committee
Union des Consommateurs
Aliant Telecom Inc.
Bell Canada
Bell Canada
Bell Canada
Bell Canada
BC Public Interest Advocacy Centre
MTS Communications Inc.
Public Interest Advocacy Centre
National Anti-Poverty Organisation
Ontario Telecommunications Association
Sasktel
Télébec ltée and et Northern Telephone Limited
TELUS
TELUS-Québec
Northwestel Inc.
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