Clause 256 - OFCOM reports on the fulfilment of
Communications Bill
4:45 pm
Mr Nick Harvey (North Devon, Liberal Democrat)
I beg to move amendment No.464, in
clause 256, page 223, line 17, leave out 'five', and insert 'three'.
The subject of the amendment was discussed at considerable length by the Joint Committee of the two Houses that scrutinised the draft Bill before the summer recess. The point is very important. I find it surprising that at a time when the Government are proposing to allow non-European ownership of Channel Five and Channel 3 and are engineering something of a revolution in our ownership rules, they should be relaxing their original intention with respect to the reports that Ofcom will produce on public service television.
It seems to me vital to the future of public service television that any failures by broadcasters to fulfil their remits should be dealt with swiftly and effectively. I fear that the current regime has sometimes allowed broadcasters to creep away from some of their commitments. If the general objective of the Bill is to bring into being a newer, lighter-touch system, there is a danger of even further weakening.
The draft Bill provided for a three-year interval between reports. The ITC, one of the existing
regulators, told the Joint Committee that even that was too long, given the speed of developments in the television market, and argued for an annual report as a vital lever to allow it to correct broadcasters' behaviour. The Joint Committee, in weighing up the arguments, came to the view that there should be a two-year interval. Indeed, I think that an amendment has been tabled suggesting that.
I have heard no argument from the Government to justify their frankly baffling decision not to shrink the interval so that there would be an annual report as suggested by the ITC, or a two-yearly report as suggested by the Joint Committee, but instead to relax and row back to a five-yearly report. That will seriously weaken Ofcom's ability to enforce public service remits and hold broadcasters to account.
Dr Nick Palmer (Broxtowe, Labour)
Just to clarify matters, I understand that if it wished to, Ofcom could report every year, but the requirement is that it should do so no less frequently than every five years. Is the hon. Gentleman sure that forcing it to report if it did not want to do so would produce a useful result?
Mr Nick Harvey (North Devon, Liberal Democrat)
I take the hon. Gentleman's point, but repeat that the existing regulator advocated that the reports should be annual. As a Committee, we thought that that was perhaps going too far. However, as time goes on, the reports will inevitably settle into a cycle or pattern. The possibility of making ad hoc reports is certainly helpful, but the fact is that the industry will fall into a regular cycle of reports. I reiterate that we are envisaging circumstances in which new owners from, America, will arrive on the scene. It would be useful to be certain that the reports will be produced more regularly than at the five-yearly intervals that would be possible under the Bill.
Mr Andrew Lansley (South Cambridgeshire, Conservative)
As the hon. Member for North Devon said, there was considerable discussion of this matter in the Joint Committee. I have seen it as one of my tasks to try to bring before the Committee some of the issues that were dealt with there, although it is better that the hon. Member for North Devon has done so on this occasion, because on this matter he is more in sympathy with the majority view on the Joint Committee than I was.
It is worth putting on the record at this point that the Government, in their response to the Joint Committee, went some way to meeting that Committee's objectives. For example, clause 256 contains some changes related to the scope of the review, including the recommendations on the cost of financing public service broadcasting, which are more specific in the clause than they were previously.
The structure in the draft Bill that the Joint Committee examined has changed in comparison with the Bill that we are considering now. It gives us more of a hierarchy of review and reporting. For example, clause 344 deals with the annual report, which is factual and statistical. Ofcom could use the annual report to signal the extent to which there was any move away from compliance with the existing structure of public service remits. Used appropriately, it could give rise to proper expectations in the industry about the likelihood of Ofcom initiating a review
under clause 256 earlier than in five years' time. As the hon. Member for Broxtowe (Dr. Palmer) rightly said, that review need not be as far off as in five years' time.
As the Joint Committee said, the review under clause 256 must be seen as a major event. I was struck by the undesirability—as it was put by one of the members of the Joint Committee—of major events in the broadcasting market happening too frequently, especially for public service channels. There should be something of a build-up to major events. A balance must be struck between how frequently the market changes, so that a major event is a proper way of responding to inevitable and sometimes substantial and rapid changes. How desirable would it be for there to be frequent occasions on which public service broadcasting feels that it has been thrown up in the air and is about to fall down again in some different distribution?
From that point of view, if Ofcom is as good a regulator as we hope and need it to be, it should have the flexibility to move sooner or later. Rapid changes might be undesirable. It might be better for Ofcom to use the powers that it has to inhibit or approve changes in statements of programme policy under subsequent clauses, or to use its annual reports to indicate that something is going wrong in which it may want to intervene on a more substantive basis.
The regulator has three mechanisms, and can use them to send signals to the market of the extent to which the market needs correction of a modest and incremental sort, or to state that the market moving towards the point at which a review of a more substantial kind is required. Such a review would reach into the remits of the channels themselves, and might arise from changes in ownership as well as changes in the marketplace, as opposed to changes that might occur as a result of the statements of programme policy.
I am not here to thank the Government for the way in which they responded to the Joint Committee, but it seems to me that there is now some scope for flexibility so that the regulator can behave in a reasonable fashion.
Dr Kim Howells (Parliamentary Under-Secretary, Department for Culture, Media & Sport; Pontypridd, Labour)
I shall be brief. The Committee may recall that when the draft Bill was published, it provided for Ofcom's reports on the public service broadcasting sector to appear every three years. However, as the hon. Member for South Cambridgeshire said, the Joint Committee suggested that a three-year interval is too long and the report should be published every two years.
Although we felt unable to accept the Joint Committee's recommendation as it stood, it prompted a discussion within the Department and we had another look at Ofcom's reviewing and reporting functions. The outcome of that reconsideration is embodied in the Bill. We propose two distinct Ofcom review and reporting cycles. The first involves an annual factual statistical report by Ofcom covering all radio and television services in the United Kingdom. Provision for that is set out in clause 344. Separately from that, clause 256 requires Ofcom to review and report no less frequently—as my hon.
Friend the Member for Broxtowe reminded us—than every five years on public service television broadcasting, including the BBC.
The hon. Member for South Cambridgeshire could have made the point—actually, he may have made it, but not as bluntly—that one great problem in this country is that we are always reviewing things. I sometimes wonder how we ever get any work done. It is important to retain some flexibility, but, clearly, setting the interval for Ofcom's reports on the public service broadcasting sector is a matter of judgment and there is no obvious right answer. Our view is that five years strikes a sensible balance because Ofcom will also be under a separate obligation to examine all broadcasting services every 12 months. Taken as a whole, the approach set out in clause 256 is consistent with the objective of establishing a regime that is generally self-regulatory, but includes provision for effective intervention by Ofcom when necessary to maintain quality.
The clause requires Ofcom to undertake the public service broadcasting review and reporting function at intervals of no more than five years, which means that Ofcom will be able to produce reports more frequently if necessary. In any case, we have made it clear that we expect Ofcom to examine the position of licensed broadcasters on an informal basis in the light of their
own annual reports. Ofcom will be able to initiate enforcement action at any time should any licensed broadcaster fail to fulfil its individual public service remit or to make an adequate contribution to the general public service remit.
In the light of my comments, I hope that the Committee will agree that our approach on Ofcom reviews and reports in the Bill is the right one, and that the hon. Member for North Devon will withdraw the amendment.
Mr Nick Harvey (North Devon, Liberal Democrat)
It has been useful to hear the Government's explanation. I found the Minister's comments semi-persuasive in that the arrangements in the Bill as drafted are flexible. However, I fear that, in practice, such recommendations tend to represent floors rather than ceilings. If something has to be done not more than every five years, it will be done every five years. On the basis of the Minister's explanation, however, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Further consideration adjourned.—[Mr. Jim Murphy.]
Adjourned accordingly at three minutes past Five o'clock till Tuesday 21 January at five minutes to Nine o'clock.