Clause 8. — (Newspaper Mergers.)

Orders of the Day — Monopolies and Mergers Bill – in the House of Commons at 12:00 am on 2nd August 1965.

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Lords Amendment No. 11: In page 15, line 28, leave out "relevant circulation" and insert: circulation per day of publication".

Photo of Mr George Darling Mr George Darling , Sheffield, Hillsborough

I beg to move, That this House doth agree with the Lords in the said Amendment.

I think it would be convenient to discuss at the same time Amendment No. 16, because Amendment No. 11 is a paving Amendment.

Photo of Sir John Hall Sir John Hall , Wycombe

May I ask the Minister also to take Lords Amendment No. 12?

Photo of Mr George Darling Mr George Darling , Sheffield, Hillsborough

It was proposed to take Amendment No. 12 with Amendment No. 13. If it suits the convenience of the House they can be taken together. I will discuss Amendment No. 16 first, because this is the major Amendment. It is a clarifying Amendment, intended to remove any misunderstanding as to the basis on which newspaper circulations are to be calculated in connection with newspaper mergers. The earlier wording in the Bill had been criticised as being unclear.

Lords Amendment No. 16 spells out in more detail how the appropriate circulation level is to be determined. It means, for example, that in the case of a paper which comes out twice weekly—say, on a Tuesday and a Friday—the average circulation would be computed by taking into account all the copies published during the relevant period of six months. We would not take an average just for the Tuesday issue and then a different average for the Friday issue. The Amendment does not change the effect of the Clause in any way, but it makes it clear beyond doubt exactly what the effect is intended to be. I therefore commend it to the House. Lords Amendment No. 11 is the paving Amendment to this one.

Lords Amendment No. 12 is a drafting Amendment which is made necessary if we agree to Lords Amendment No. 13. This is an attempt, quite successfully, to meet the concern expressed in Committee, both in this House and in another place, that there should not be unnecessary investigations by the Monopolies Commission of acquisition of small newspapers. It has been suggested that this might have the effect of discouraging desirable transactions. The Amendment would, therefore, permit the Board of Trade to consent to the transfer of a newspaper with a circulation at or below 25,000 copies without reference to the Monopolies Commission.

The level has been set at 25,000 copies in the light of all our available statistics about local newspaper circulations. By a further Lords Amendment, if I may mention it also—No. 14, Clause 8, page 16, line 2—there would be power to vary the figure should experience suggest that this would be desirable.

Photo of Mr William Van Straubenzee Mr William Van Straubenzee , Wokingham

The Minister of State will remember that I take a rather particularly paternal, and legitimately paternal, interest in the Amendment. I am, therefore, directing my attention to Lords Amendment No. 13. While I take the point that by Lords Amendment No. 14 the figure which the hon. Gentleman has selected can subsequently, if necessary, be varied, I do not think that he has argued the case for exempting all circulations of 25,000 and under with the persuasiveness which he usually used when we discussed this matter both in Committee upstairs and on the Floor of the House.

The Minister of State appears to be saying that if a newspaper with a circulation of 25,000 or less is taken over, although it creates a monopoly situation, it creates only a small monopoly situation. For my part, particularly concerning local newspapers, it may be a little sin, but it still remains a sin.

Surely, the phenomena that we are seeing in the country and which gave rise to the Government accepting the Amendment in the first place is the buying up by substantial groups, and by one substantial group in particular, of a fairly large number of local newspapers with very small circulations. The acquisition of one certain local newspaper well-known to me would slip through the net entirely under the Amendment which we are being invited to accept, and yet it is part of a deliberate—I use the word without criticism—buying-up process of local newspapers in one area.

That is a situation which this House, having taken the plunge of principle, should go on to correct. I am very sorry that it was Members of another place from my party who pressed the Government in this regard. I disagreed fundamentally with them. I am also sorry that the Government are asking us to accept the Lords Amendment. However, having said that, I accept the practicability of this matter.

I personally believe, if I may make a prophecy, that the Government or their successors will find it necessary to vary this figure by the power which in a moment, I trust, they will possess, because I am quite certain that this is a tendency which it is against the interests of the nation should go on unchecked.

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

I should like to say a word in support of my hon. Friend the Member for Wokingham (Mr. van Straubenzee). When we were in Committee on the Bill I drew attention to the possible desirability of a merger of small newspapers which were serving the same area, but none of which had the necessary viability to serve its readers properly, and I suggested that there were plenty of cases in which small newspapers might join together, with no question of a take-over by a major group. When the President of the Board of Trade undertook that this matter would be reconsidered I asked that nothing should be done to prejudice mergers in such cases.

This Lords Amendment appears to go rather wider than that, and it appears that it will be possible for consent to be given for small papers to be taken over, even though they are to be taken over by large ones, so making the whole process considerably wider than I, at any rate, then envisaged. I should have thought that there was everything to be said for scrutinising very carefully taking over even a very small paper if it is to go into one of the big groups. The only mergers to which I think it would be right to give consent without asking for a report would be of two or three small papers, where they decide to come together to pool their resources to provide more viability. If I have understood this Lords Amendment correctly it does not do that: it exempts from the requirement of a reference to the Monopolies Commission a take-over of a small newspaper, whose circulation is under 25,000 a day, by a large chain. I may be wrong. I may have completely misunderstood. The Minister of State is nodding his head indicating I have, in which case perhaps I had better sit down.

Photo of Mr George Darling Mr George Darling , Sheffield, Hillsborough

With permission, I would point out that newspapers with a circulation of less than 25,000 are not automatically exempted. What the Lords Amendment does is to permit the Board of Trade, where in the opinion of the Board the circumstances are such that permission ought to be given, after a thorough examination of the facts, to permit the transfer to go ahead without reference to the Monopolies Commission. In other circumstances, the Board could refuse consent, in which case it would go to the Monopolies Commission.

Question put and agreed to.

Subsequent Lords Amendments agreed to.

Lords Amendment No. 14: In page 16, line 2, at end insert: ( ) The Board of Trade may by order made by statutory instrument provide that any amount of circulation specified in subsection (1) above shall be varied, or, where a previous order has been made under this subsection, further varied, by such amount as may be speciefid in the order; and a statutory instrument containing an order under this subsection shall be subject to annulment in pursuance of a resolution of either House of Parliament.

Photo of Mr George Darling Mr George Darling , Sheffield, Hillsborough

I beg to move, That this House doth agree with the Lords in the said Amendment.

This Lords Amendment would permit the Board of Trade by order to do two things: first of all, to vary the figure in Clause 8(1) which shows the level at which the total circulation of a newspaper or of a newspaper proprietor or group reaches a point where further acquisitions are to require consent—the figure stands in the Bill at 500,000 copies per day of publication; secondly, to vary the figure in subsection (1) showing the level of circulation of small newspapers—such as we have just been discussing—at or below which the Board of Trade may give consent to transfers without a reference to the Commission. The figure may be varied, but until it is, as the hon. Gentleman has just said, and as I said in moving the original Amendment, it stands at 25,000 copies.

10.45 p.m.

The Amendment reflects a suggestion made by the Opposition in another place, and the Government believe that it introduces a desirable element of flexibility into the Bill. As the House knows, in dealing with newspaper mergers we are entering into a completely new field. The figures in the Bill represent the best judgment that can be made in the light of the information available to us, but it may be that experience will suggest that some variation is desirable. This Amendment will give us the flexibility which I think the House will agree is necessary.

Photo of Sir Harmar Nicholls Sir Harmar Nicholls , Peterborough

Before the new figure is put in, will it have to be passed by this House in some form?

Photo of Sir Harmar Nicholls Sir Harmar Nicholls , Peterborough

And it will be the negative procedure?

Question put and agreed to.

Lords Amendment No. 15: In page 16, line 18, after "months" insert of the matter being referred".

Photo of Mr Douglas Jay Mr Douglas Jay , Battersea North

I beg to move, That this House doth agree with the Lords in the said Amendment.

This Amendment clarifies the word "months" which appears in line 18 on page 16. It makes it plain that the three months referred to in line 18 are the three months which have already appeared in line 8 that is to say, within three months of the matter being referred to the Commission, and are not a reference to the further time, not exceeding three months, which appears in line 10 which the Board of Trade may in addition allow. We are making it clear that the subsection does not empower the Board of Trade to extend the period of investigation so that the total period could exceed six months.

Question put and agreed to.

Subsequent Lords Amendment agreed to.