I shall take up that point in a few minutes.
Notwithstanding the anxieties about the industry, which have been expressed today and in the past, closures of national daily or Sunday newspapers have taken place at intervals over the years. There were many take-overs before we had the argument about whether The Times should or should not be taken over. There has been increasing competition, particularly from television, and competition not only in the dissemination of news but also in advertising. This also has been with us for a number of years.
Because of the long-standing concern, we have had a succession of reports. There was the Royal Commission of 1949, the Royal Commission of 1961–62, and now the E.I.U. Report. One hardly doubts that if we do nothing about the situation now we shall have a further report or Commission of some sort in a few more years. It is useful, therefore, to look back at some of the observations made by the two Royal Commissions.
Going back to 1949, the Royal Commission said:
We should deplore any tendency on the part of the larger chains of newspapers to expand",
and in the same Report we read:
Any further decrease in the number of national newspapers would be a matter for anxiety.
Those were opinions expressed nearly 20 years ago. Turning to the more recent Royal Commission of 1961–62, we were then told:
It would be better if there were more choice",
Concentration of ownership carries with it the potential danger that variety of opinion may be stifled ".
Yet no action of real significance has been taken by successive Governments. We see no real change at all.
I do not believe that the reason for inaction is disinterest or a failure to realise that a problem exists. The underlying factor is the difficulty and complexity of the problem itself. Obviously, there is no easy quick solution, and anyone who suggests that there is does no service to the cause of a free Press in this country, and he deludes those who work in the industry in whatever capacity.
We have a unique state of affairs in Britain today. We have more newspaper readers compared with total population than any other country. Readership of our national newspapers per 1,000 of popular on is the highest in the world. Together with that, we have a large overall population—50 million or so. This is a very densely populated country with, in spite of the many comments we make in the House, generally very good communications.
All this has meant that in Britain, and in Britain alone as compared with the rest of the world, it has been possible for a highly centralised national Press to be developed, centred on the capital city. Over the years, there has been increasing concentration on London, with newspapers being edited and printed in London and despatched overnight all over the country. Some editions are produced in Manchester and Scotland, of course, but the great emphasis has been on London editorial production and London printing. This emphasis on the capital has been far greater than it has been in any other country.
One consequence of this development has been the production of mass circulation newspapers. The circulation figures of our national daily papers are far in excess of the figures of comparable newspapers anywhere else in the world. It is because of that unusual situation that that very strange economic structure has arisen in the industry over the years. The difficulties of the British national Press are therefore unique. They are difficulties which cannot be shown to exist in other countries to anything like the same extent.
It is in this situation that we find today about half of our national daily papers making a loss; and very much the same sort of situation is found in the Sunday newspapers, of which perhaps just under half are making a loss. Those newspapers are making losses despite what would be considered mass circulations in world, Western European and American terms. Papers like the Sun or the Sunday Telegraph would be regarded as having mass circulations in France, West Germany, Italy, any other European country, or in America. Yet they are almost below the starvation level here.
It is an extraordinary situation that daily newspapers with these mass circulations are being threatened with closures and are making considerable losses at the moment. The E.I.U. Report forecast that in the next five years we would lose four national newspapers—two popular dailies and one quality daily, and one quality Sunday.
One of the most disturbing things about the Report was the way in which all the emphasis was on the possible closures. I could not see a word about new newspapers. Yet, why should we be concerned with the purely restrictive side of things in the industry? I do not wish to get involved in extreme political viewpoints, but it disturbs me that it seems impossible today for anybody to start a new paper in this country. Efforts were made to do so on the extreme Right and extreme Left of the political spectrum, and although the sort of newspapers that might have been produced would not have been to my taste, I regret that it was apparently not possible for anyone to succeed.
We must consider how the situation has arisen and why. I hope that I have outlined why the industry is very different from any other. The British national newspaper industry is not only different from the newspaper industry in other parts of the world, but is very different from other industries in this country. One talks of success and failure and those words have been used in today's debate. But the criteria of success and failure in the industry are so totally different from what they are in every other industry in the country that I find it difficult to use the words. Indeed, some of the most successful newspapers to my mind are among those whose chances of survival seem most remote.
I now wish to turn to the economic side, because it is there, and particularly in the distortion of income in the industry, that many of the problems arise. The problem is not to such a great extent, as one hon. Member tried to suggest, a failure to produce a product of adequate quality. It is not a failure to sell newspapers or even to take into account the changing demands of the community and the consumer. Other factors which are often beyond the control of those who guide the destinies of particular newspapers result in failure. I am concerned about this because selling newspapers is not the same as selling detergents. Producing newspapers is not like producing motorcars. The industry is different and the Government have a duty to deal with it in a way different from that in which they deal with other industries facing similar problems.
The income of the newspaper industry is dangerously distorted by over-dependence on advertising revenue. We have heard how the quality newspapers derive more than 70 per cent. of their income from advertising revenue, and even the "populars" derive about 40 per cent., a fantastically high proportion which makes the newspapers exceedingly vulnerable to any change in advertising expenditure for any reason. The question of an economic crisis has been mentioned. The slightest suggestion of economic crisis will mean a catastrophic drop in advertising revenue for newspapers on the breadline, because when there is a cut in advertising expenditure it is not spread evenly through the newspaper world; it affects the less successful, smaller circulation newspapers. It is not the giants which feel the squeeze when there is economic crisis, but newspapers on the borderline.
The effect of commercial television is felt in the same way. I was concerned that the Leader of the Opposition spoke so glowingly about local commercial radio, because I doubt whether many people in the industry would welcome it. The inordinate effect of very small changes in advertising expenditure underlines the vulnerability of the industry.
The other side of the coin is that too little of a newspaper's income comes from the consumer. It is not popular or desirable these days to talk about raising prices, but I must be blunt about the amount we pay for newspapers. What we pay for a daily newspaper makes it the best buy in the world. At the moment, 4d. is the price of a newspaper with a very large number of pages giving wide political, social and other coverage. In Western Europe, America, or any other comparable country, one finds that the consumer must pay a great deal more.
I do not want to bore the House by quoting a large number of examples, but I have been unable to find any newspaper that is "national" in our sense that does not charge at least 50 per cent. more than our cheaper newspapers. We shall have to prepare ourselves to pay more for our newspapers. It is right and proper that we should do so in the future.
We should also consider whether the price structure, the cost we must pay as consumers, is too rigid. I know that there are differences between newspapers costing 4d., 5d. and 6d., but generally we pay 4d. for a daily paper and 6d. for a Sunday paper. I am not convinced that that is necessarily right and proper, and that there should not be a greater variation in the amounts we pay for our papers. That is done without question with magazines, but the difficulty at the moment is that no newspaper dares change the amount it charges the consumer, because it fears that a drop in circulation will result in a catastrophic drop in advertising revenue, which could be the end of the newspaper.
That is an unfortunate and difficult dilemma, but Government action of the right sort could do something to solve it. If the industry felt that there was some sort of lifeline, some sort of net, so that a paper which had the courage to charge more to the consumer could do it without sealing its own death warrant, a bit more economic sense would be introduced into that part of the newspaper world. The danger of circulation loss resulting from the price going up is somewhat exaggerated. Small increases in the cost of newspapers would be accepted when the consumer felt that they were worth while and produced a better product.
A great deal as been said in the debate understandably about the cost of production. The emphasis has been laid time and time again on the E.I.U. Report's comments on poor management and out-dated union practices. I do not want to go into them in great detail, but I believe that there is a tendency to overemphasise those problems.
I was interested to see that the Report said that:
Restrictive practices are not as bad as is generally believed.
and that they
do not materially affect final success or failure.
That is not to say that there should not be a change in many of the practices seen in the newspaper world. Management could certainly improve to a considerable extent, and on the trade union side it
is necessary to solve the problems of over-manning, of the difficulties of people in getting into the industry, and of adapting to the modern techniques which will come in more and more rapidly in the years ahead.
In addition, the relationship between management and trade unionists is not in the main as happy or satisfactory as it should be. When talking about that relationship, let us not talk just about the two sides. There is a third side—the journalist. One sometimes tends to forget that side of the industry, particularly in times of crisis like this. Very often it is the journalist, rather than the management or the trade union side, on whom most of the pressures are exerted when newspapers face economic storms.
It tends to be the journalists who are given the sack at the drop of a hat and, indeed, the higher up the scale the greater seems to be the risk. Some of the posts seem to change as rapidly as football league matches. That part of the industry is perhaps more vulnerable than any other. The journalists often have to work long hours and perhaps they have not the protection that the managements or the trade unions enjoy.
The question is what action, if any, can the Government take? I am not prepared to accept—and it would be wrong to do so—the present situation. We cannot just go on as we have done over the last 15 or 20 years. I am certain that, if action is not taken in the reasonably near future, it will be forced upon us in the more distant future. If we are to take action, we should think now about what it should be and start to take it as soon as possible.
Obviously, we should encourage the industry itself—the more we can do that the better—to put its own house in order. One feature of the Report is that it came about as a result of the initiative of the industry, including both sides. That is a good sign that augurs well for the future. But even when many of the things it says are wrong are put right, we shall face the same sort of problems as today. We have to look to more positive measures.
The difficulty is to find something acceptable and compatible with a free Press. All sorts of things have been suggested, including various forms of taxa- tion and restrictive measures, and a legal limit on advertising. I doubt whether this would work, or help the sort of newspapers that a great number of us in this House would like. Another suggestion is for some sort of differential taxation on advertising or on advertising over a certain limit. This would involve such a vast bureaucratic machinery that it would not be reasonable.
The question of Government advertising has also been raised. I cannot regard, and it would be wrong for the Government to regard, Government advertising as a means of giving hidden subsidies, but I ask the Government to look at their advertising policy because I am not certain that the commercial criteria by which they determine which newspapers to use are always right. They could spread much of their advertising more widely while still considering the purely commercial criteria.