Oral Answers to Questions — Communications White Paper

– in the House of Commons at 3:31 pm on 12th December 2000.

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Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport 3:31 pm, 12th December 2000

I should like to make a statement on behalf of my right hon. Friend the Secretary of State for Trade and Industry and myself on the communications White Paper "A New Future for Communications", which was published today and produced jointly by our Departments. Copies have been placed in the Library, and the White Paper is also available on the world wide web.

We are living at a time of revolution in the ways in which we communicate. The worlds of telephony, broadcasting, mobile communications and the internet are changing and converging with astonishing speed. Meanwhile, our current regulatory framework was designed for a different age. We need to update the framework of regulation, and put in place a system that recognises the current fast-changing picture and can cope with the inevitability of change in years to come. The White Paper prepares us for that future, and will set up modern regulation for a modern world.

We will be creating a new regulator—an Office of Communications, or Ofcom. The new regulator will cover all communications—telecoms, television and radio. It will help to give the United Kingdom a world lead by creating a new framework for those fast-moving industries. It will simplify and rationalise the regulatory system. It will provide a broadly lighter-touch approach, giving the industry the opportunity to act with responsible freedom. However, it will robustly uphold important standards of quality and protection for citizens.

For citizens and consumers, it is essential that we provide some certainty in what, for many, will be a world of bewildering change. We therefore aim to protect the high quality of broadcasting which we all tend to take for granted. So we are strengthening our commitment to public service broadcasting, to investment in the distinctive voices and needs of the regions, and to the importance of rules such as the watershed, to make sure that parents and citizens can protect children and vulnerable people from unsuitable broadcast material.

The challenge is both to free our industries from outdated rules, helping to promote competition in these markets, and to balance that with a framework which puts the needs of the citizen at its heart. If we are to meet this challenge, we need to think beyond the traditional compartments of broadcasting and telecommunications, of content and carriage.

That is why Ofcom will regulate the broadcasters—both radio and television—and the telecommunications sector; both content and the communications networks that carry services. It will jointly regulate competition policy with the Office of Fair Trading. It will also manage spectrum, thus covering the range of responsibilities at present exercised by the Independent Television Commission, the Radio Authority, Oftel, the Broadcasting Standards Commission and the Radiocommunications Agency.

The White Paper sets out a number of specific proposals, which are encapsulated at the end of the document, and also in a summary leaflet which we are publishing simultaneously. In this brief statement I can do no more than select some of those which I think will be of most concern to the House.

In developing the policies for the White Paper, my right hon. Friend and I set three main objectives: first, to ensure universal access to a choice of diverse services of the highest quality; secondly, to make the United Kingdom home to the most dynamic and competitive communications and media market in the world; and thirdly, to ensure that the interests of citizens and consumers are safeguarded.

Everyone should continue to have easy access to public service television and radio channels, as now, free at the point of delivery. The White Paper therefore sets out our proposals to ensure that television channels currently available free to air are carried on all platforms—satellite and cable, as well as through the television aerial. We intend both a "must carry" obligation on UK-based network providers, and a "must provide" obligation on the public service broadcasters.

Other communications services should be available to all at an affordable price, and we shall build on the universal telephony service obligations and Oftel's work to secure competition, so that people can increasingly benefit from new services, including the internet and higher bandwidth services. The Prime Minister has already made clear our commitment that everyone who wants it should have access to the internet by 2005. We are committed to ensuring that there is no digital divide, and that everyone should benefit from the information opportunities that are opening up.

In a world of increasing choice of channels and other sources of information and entertainment which digital technologies are bringing us, our fundamental belief is that public service broadcasting will become more, not less, important to society. It will be important especially as a forum for informed public democratic debate, to ensure that a plurality of views and perspectives is available; to ensure that high-quality educational material is available to all without extra charge; and to help to drive the transfer from analogue to digital.

We propose a new three-tier approach to the regulation of broadcasting, to provide a more level playing field between different broadcasters depending on the extent of their public service remit.

In the first tier, all broadcasters will be subject to basic rules on minimum content standards, impartiality in news, provisions on the protection of minors and access for people with disabilities. We will require Ofcom to give due weight to the need for improvements in such access for people with disabilities. We also intend that Ofcom should act as a final backstop one-stop shop for complaints for all broadcasters.

The second and third tiers will apply to public service broadcasters. In the second, regulated by Ofcom, those obligations that are readily measurable will be included: independent and original programme production quotas; requirements for regional productions and programming; and the availability of news and current affairs in peak time. We shall amend the BBC's agreement to include such a formal requirement for the first time.

In the third tier—where the general public service provision of high-quality varied schedules will rest—we propose to rely primarily on transparent self-regulation, but with backstop powers in place in the event of failure. Each broadcaster within this tier will be required to make a statement of programme policy updated each year, and to report on subsequent success. Each broadcaster will of course have a distinctive remit, and the backstop power will rest with Ofcom in the case of the commercial broadcasters, and with the Secretary of State and Parliament in relation to the BBC.

We place particular emphasis on the regional dimension of public service broadcasting. There is a further aspect to that, of which hon. Members are aware and which they have raised with me on a number of occasions, concerning anomalies in regional coverage whereby, for technical reasons, some parts of the community do not receive the relevant regional programmes. We therefore propose to work with broadcasters and with local communities and their Members of Parliament to find new ways of resolving such difficulties with the advent of digital technology.

An important part of the public service mix is, of course, Channel 4 and we have rejected suggestions that it should be privatised. Channel 4 is a highly distinctive and successful service, much valued by viewers. The present structure of a statutory corporation works well. We will therefore maintain Channel 4 as a public sector broadcaster and ensure that it continues to be distinctive and innovative, providing both complementarity and competition to the BBC and ITV.

In the commercial sector, our view is that increased competition allows us to depend more on Competition Act 1998 powers rather than those specific to the sector, in order to secure diversity of ownership and competition in the relevant markets, such as advertising. We propose to replace the rule preventing anyone from holding two or more licences which attract 15 per cent. or more of the total TV audience share, and we propose to revoke the rule prohibiting single ownership of the two London ITV licences. We will consider changes to the points system for regulating radio ownership. We will also seek to boost the role of local community broadcasting in the digital environment, exploring the suggestion of an access fund for community radio, under the aegis of Ofcom.

We believe that sector-specific rules to promote competition will still be needed in the communications field, but we will make sure that the stronger sectoral rules will be applicable only to companies having significant market power, with lighter-touch regulation for most companies.

Ofcom's powers must enable it to address new competition challenges as these emerge from advancing technology and changing business models. For example, the increasing need to rely on electronic programme guides leads to a new risk that they might be used to limit competition and consumer choice. Ofcom's powers to promote competition and protect consumers will therefore apply to access to EPGs and similar new systems. And we shall take specific powers to ensure that public service channels to which access is essential for full social inclusion can benefit from "due prominence" on all relevant EPGs. Services which we require to be universally available must also be readily accessible.

Communications depend either on wires or on the use of the electromagnetic spectrum. The spectrum is an essential resource which must be managed in the public interest and in innovative ways that meet the needs of developing technologies. Because of the central importance of spectrum management to the development and success of the UK's communications industries, we shall bring within Ofcom the responsibility for spectrum management.

Ofcom will have a principal duty to protect the interests of consumers. There will be a new consumer panel to advise the regulator, able to research consumer views and concerns about service delivery and to represent those concerns to Ofcom and others. It will be independently appointed, decide its own research objectives and publish its findings and advice.

Ofcom will have a crucial role in ensuring that our interests as citizens are properly respected by the world of communications. It will maintain content standards in the broadcast media and ensure that the risk of harm, especially to the vulnerable and to children, is minimised in all electronic media. Ofcom will therefore be responsible for maintaining arrangements such as the watershed on free-to-air channels and for promoting better understanding of media messages and the use of new mechanisms such as rating and filtering systems that can assist the safe use of the internet.

We have carried out extensive consultation in preparing for the White Paper. In response to our request for views in February, we received some 160 replies. We have heard many views in person and we are very grateful to all who have contributed, including the group of experts who provided some clear thinking in the crucial early stages of preparation. I pay special tribute to the boards and staff of the current regulators, who have worked in an open and constructive way to help us to develop the policies that we are announcing today.

Broadcasting and telecommunications affect all of us every day. We have set out in the White Paper our proposals for a new framework for regulation, which we believe will preserve the best of the past and prepare the UK to take advantage of the new technologies of today and of tomorrow. Alongside our firm policy proposals are some on which we invite further views. I look forward to hearing the views of hon. Members, and I commend the White Paper to the House.

Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey

I thank the Secretary of State for his statement and for the advance notice he provided—albeit somewhat truncated by a fire alarm and evacuation in his Department; I hope that all is now well. In fact, we have had more advance notice than usual, as much of the statement seems to have appeared in the Financial Times this morning.

In other respects, the White Paper has been slow in coming. A pledge to reform the regulation of media and broadcasting was contained in the Labour party manifesto for the current Parliament; it is another pledge that will not be kept. Will the Secretary of State confirm that the planned legislative changes that he has announced today stand no chance of taking effect until 2002 at the earliest? The media and communications industries are moving fast; the Government are moving painfully slowly. Industry often complains that the Government try to do too much, but here we have an unusual example of the Government getting in the way by doing too little.

Progress toward today's announcement has been helped neither by an undignified turf war between the Department for Culture, Media and Sport and the Department of Trade and Industry nor by the confusion and incompetence that is the hallmark of Labour in office. The House will recall how those two Departments have been falling each over—[HON. MEMBERS: "Each over?"]—falling over each other like characters in a comic sketch for the past two years. In March 1998, the DTI published its utilities regulation Green Paper; in July 1999, both Departments published a convergence Green Paper. In November 1999, the DTI announced a Utilities Bill, which included proposals for the communications industry and, in January this year, received its Second Reading—[HON. MEMBERS: "Ah."] My hon. Friends remember it well. In February, the Government announced a forthcoming communications White Paper—which is, presumably, what we have today. However, in March, the communications part of the Utilities Bill was unceremoniously dumped.

I had always thought of the Secretary of State for Culture, Media and Sport as having the last word in dither and incompetence, but I now realise that I have led a rather sheltered life all these years. In this case at least, the right hon. Gentleman has nothing on the Secretary of State for Trade and Industry, which is probably why the former has come to the House to make today's statement.

The technical and regulatory aspects of media and communications are often regarded as subjects fit only for anoraks, but they are vital, dynamic, growing industries—powerhouses of new employment and investment with the capacity to enhance or to damage the quality of all our lives. There is an urgent need to update the regulatory framework to reflect the dramatic changes, such as the development of the internet, that have occurred since the Broadcasting Act 1996 was passed. What the Government have announced today, after all the consultation and debate, takes us a little further forward, but not far enough.

This is a White Paper with a heavy hint of green about it. It is very general indeed, and it has one major failing. The Secretary of State referred several times in his statement to public service broadcasting, but he has failed to define it. Until we define what public sector broadcasting means in the digital age, we shall continue to fail the industry.

Conservative Members support in principle—and, indeed, have argued for—a new single regulatory body capable of taking a balanced view across converging media. It is essential, however, that the new body has a clear and unequivocal remit with stated priorities. A tension exists between competition and content issues. How does the Secretary of State intend that tension to be addressed within the new regulatory body? Whether the system will work at all will depend on getting that right.

We welcome the proposal for a new consumer panel, but will that have muscle or will it be another focus group? Will the new regulator be a panel or a person? Who will pay for the new regulatory body? To what will Ofcom be accountable—the Department for Culture, Media and Sport or the Department of Trade and Industry? Who will make appointments to it and what sanctions will it have? Will there be financial sanctions, and will those apply to the BBC?

Given the pace of change in the industry, the only way to avoid having to come back to the cumbersome process of legislation will be to ensure that the new regulator has sufficient flexibility to meet changing needs. How does the Secretary of State intend to deal with that? How will the new regulator be affected by any finalised EU directives on telecoms? In the week that the Prime Minister has spent so many late nights in Nice, the Secretary of State seems to have forgotten all about the EU.

We welcome the proposal to bring the activities of the BBC into the new regulatory framework, but will the Secretary of State confirm, as his statement implied, that, as regards complaints about political bias, the BBC will cease to act as judge and jury in its own case?

What powers will Ofcom have to ensure fair competition between the BBC and other broadcasters, and, just as important, between other internet publishers? Does the Secretary of State recognise the need to prevent the BBC from using the licence fee to crowd out commercial competition? Will that issue be dealt with by Ofcom under the Competition Acts or is new legislation envisaged?

Will Ofcom take on responsibility for ensuring wider industry access to local telephone lines? What measures does the White Paper contain to ensure that we do not continue to fall behind Germany and other major economies in developing internet access? What will the White Paper do to encourage the take-up of digital television?

I note that the Secretary of State has paved the way for the creation of a single ITV, but his statement is particularly vague about the reform of radio. Many people in the radio industry will be extremely disappointed that, after so long, they are going to have only further delay and consultation.

I particularly welcome measures in the White Paper aimed at reinforcing the watershed and the protection of children from inappropriate material.

The Government have completely ducked any specific reform of the cross-media ownership rules. The Secretary of State will be aware that there is a powerful case for change here. Has his timidity on that point anything to do with the fact that there is a general election on the way—an election that the Government do not deserve to win?

We welcome the general thrust of today's statement, but we do not trust the Government's meddling instincts. Where there is a need to be radical, the Government have been timid. The vital need to balance the interests of commerce and culture will not be met by a Government who understand neither.

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

I note that the hon. Gentleman was, as one might put it, "falling each over" his vocabulary while he made that contribution. I might well describe his contribution as an infrastructure lacking content: perhaps we should send in Ofcom to regulate the Tory Front Bench. The hon. Gentleman came up with the old chestnut about there supposedly being a turf war between two Departments. That is a gross slur on the good and constructive work that the DTI and the DCMS have done together on producing the White Paper. The team has worked extremely well together and the White Paper has been agreed at every stage, both between the two Departments and across government.

The hon. Gentleman eventually got round to some specific questions. He said that nowhere in the White Paper was public service broadcasting defined. I suggest that he reads pages 48 to 51, where it is comprehensively defined. He asked whether the consumer panel would have muscle. I suggest to him that the White Paper's proposals to establish an independently appointed panel which can publish research and has a statutory right to put its views clearly and publicly to Ofcom are, indeed, proposals for a body with muscle. He asked whether the regulator would be a panel or a person. If he reads the document, he will discover that it will be a board, not a single person, and that it will have an independent chairman. He also asked to whom Ofcom would be accountable. It will be jointly accountable to me and my right hon. Friend the Secretary of State for Trade and Industry.

The hon. Gentleman asked about the role of the BBC. As chapter 5 of the White Paper spells out, the BBC governors will retain a specific role for upholding the remit of the BBC, just as the board of Channel 4 will have a role for upholding the remit of Channel 4, and the managers of ITV will likewise have a role for ITV. However, there will be a role for Ofcom in ensuring that the general economic and competition provisions that apply to all broadcasters apply also to the BBC. It will also have a role in ensuring that the measurable, quantifiable aspects of public service broadcasting—aspects such as independent production quotas and ensuring news and current affairs in peak time, and that regional targets are met—are regulated across the broadcasting landscape, including the BBC.

The hon. Gentleman asked whether the proposals mean that we are moving towards a single ITV. The sector-specific provisions that currently prevent such a move from occurring—the 15 per cent. rule and the two London licences rule—are due to be lifted. However, any proposal to move towards a single ITV would have to be subject to competition law, competition policy and, ultimately, to the decisions of the competition authorities. The hon. Gentleman asked about the future of radio. We spell out in the White Paper the way in which we want to move away from the current radio points system for the calculation of ownership requirements, and make it very clear that we want to do that.

In all those respects, the White Paper is very clear. I hope that when the hon. Gentleman has more time to consider the detail—obviously, he has had the White Paper for less time than I have—he will find that his concerns are readily addressed. The key message from the White Paper is that it is about giving responsible freedom to the broadcasters. Yes, it will be a greater freedom than many of them have had until now, but it comes with the expectation that they will exercise it responsibly and that measures will be in place to ensure that they do so.

Several hon. Members:


Photo of Michael Martin Michael Martin Speaker of the House of Commons

Order. We are about to have a major debate that is time limited, so I must appeal for short questions, as well as short answers.

Photo of Mr John Maxton Mr John Maxton Labour, Glasgow Cathcart

I welcome the White Paper from the Department for Culture, Media and Sport and the Department of Trade and Industry, and I look forward to debating it in a little more detail in the Select Committee on Culture, Media and Sport. However, I should like some clarification. First, will my right hon. Friend give a total assurance that the BBC's ability to be the highest-quality broadcaster in the world, as well as one of its most innovative, will not be affected by the proposals? Secondly, will he ensure that that ability extends to the very good website that the BBC operates, and which it will develop in the coming years? Nothing must be done to prevent the BBC from using that to give people throughout the world the quality that the corporation can offer.

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

The quality of BBC programming and production values will be enhanced by our proposals in the statement. That will, of course, apply to the excellent BBC online service, as it will do to BBC television programme making.

Photo of Norman Baker Norman Baker Shadow Spokesperson (Business, Enterprise and Regulatory Reform), Shadow Spokesperson (Culture, Media and Sport)

I welcome what is overwhelmingly a sensible and robust set of proposals—I felt that the Conservative response was a little churlish—and it would be difficult for me to do otherwise, because the proposals echo many recently published Lib-Dem proposals; perhaps it is comforting that, in the digital era, we still have repeats.

I turn to a repeat of a less welcome nature. The right hon. Gentleman will be aware that the White Paper's proposals were trailed significantly in the press today and at the weekend. What briefing took place of journalists for last Sunday's newspapers?

How will the relationship between Ofcom and the Competition Commission work to prevent duplication? Will the right hon. Gentleman give an assurance that the probable formation of one ITV will not in any way reduce regional programming and regional production? Will his commitment to ensure that ITV is available on satellite television extend only to that one ITV—in other words, London—or will all ITV regional companies be accessible on satellite?

Will the right hon. Gentleman comment on the future of BBC World, which he did not mention in his statement? In the digital era, it is surely a little odd for the Foreign Office to maintain that it should support the BBC World Service—radio services involve technology from a bygone era and, although radio is still important, it is only one medium—while there are no proposals to ensure that BBC World is similarly supported.

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

In relation to briefings of the press, I gave an interview to The Daily Telegraph for its Saturday edition and to the Financial Times for this morning's edition. I spoke only in the most general terms about the principles lying behind all that we are seeking to do. Other briefings, I have to confess, I know nothing about.

The hon. Gentleman asked about Ofcom and the Competition Commission. They will work together to regulate the media from the point of view of competition policy. Ofcom will clearly have a role in closely advising the Office of Fair Trading in its approach to these matters.

On any move towards a single ITV and its impact on regional production, we set out in chapter 4 of the White Paper some very tough provisions on the need to maintain regional strength. For example, one provision states that if a regional licence changes hands at any stage, Ofcom will assess the regional proposals that are being made and enhance regional requirements at that point. If ownership changes, regional requirements will be strengthened, rather than diminished, in the process.

The hon. Gentleman asked about the accessibility of ITV companies on satellite. The answer is that, so far as possible, we would want to ensure that the relevant regional programme was available to the relevant region. That is the principle that we want to set in place, although it may of course be necessary to sort out some technical issues to achieve it.

On the World Service, radio may be an old technology, but it is a very popular, versatile and high-quality technology. It offers ready access to virtually all communities across the world, and the World Service does an excellent job in using that medium to make impartial news and current affairs information available to the world.

Photo of Tom Levitt Tom Levitt Labour, High Peak

My right hon. Friend mentioned the need to allow disabled people access to broadcasting services. He will be aware that about 1,000 people in every constituency rely to a greater or lesser extent on subtitling. What measures will he introduce to ensure far greater availability of subtitling outside the traditional analogue channels than there is now?

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

Such matters will rest in tier 1 of the three-tier regulation system for broadcasting, which will apply to all broadcasters. We shall look to Ofcom to ensure that subtitling is enhanced beyond what is available at the moment.

Photo of Ian Taylor Ian Taylor Conservative, Esher and Walton

The Secretary of State has given birth to a White Paper after a long pregnancy, which began during the previous Government when I was a Minister. I remember very well many of the better bits of what he has announced. I commiserate with the Secretary of State for Trade and Industry, who should have made this statement. I hope that he has not lost control of the matters that we gained for the DTI and Oftel, such as the electronic programme guide and the technology under the Broadcasting Act 1996, when a Bill, because it is crucial that those matters are in the hands of the DTI if the commercial and creative industries are to be best promoted.

Will the Secretary of State please make it clear what is intended for digital television, because that is the unspoken part. The right hon. Gentleman is so passive about this issue. Surely it is no good waiting for 95 per cent. coverage if what is needed is a public-private sector partnership to get the thing going. In a multi-digital channel age, it is not enough to announce the semi-continuation of the BBC and the statutory position of Channel 4. Public service broadcasting now covers a multiplicity of channels and various means of delivery, and we must completely redefine how public service broadcasting can best be achieved, rather than continually backing just the BBC.

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

First, may I say what a great pleasure it is to see the hon. Gentleman in his place.

The DTI and DCMS are at one on the need to ensure that responsibility for access to the new media—especially issues such as the electronic programme guide and access for programme makers to satellite and cable channels—comes under the framework that we are establishing.

On digital switch-over, we are right to say that we do not want to switch off the analogue signal until we are absolutely certain that everyone who can receive the analogue signal at the moment will be able to receive digital signals in the future. It would be folly for any Government or any party to suggest that they wanted to do otherwise. That and the test of affordability are the two fundamental tests that we have put in place. We have set a target timetable of 2006-10, and we believe that that can be achieved, but those tests must be met.

Photo of Ann Clwyd Ann Clwyd Labour, Cynon Valley

As my right hon. Friend knows, the Independent Television Commission has the power to monitor the commitments made by franchise holders on the delivery of programmes. What in the White Paper will ensure that franchise holders of lucrative contracts deliver the programmes that they promised to deliver when they were awarded the franchises?

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

We propose a stronger process to ensure that that happens. ITV franchise holders will be expected to issue a statement every year of their programming, scheduling and public service priorities. They will have to be tested against that statement during the year, and Ofcom will be expected to analyse how they have performed against that statement before they make the next one.

Photo of Mr Peter Brooke Mr Peter Brooke Chair, Northern Ireland Affairs Committee, Chair, Northern Ireland Affairs Committee

Given that the same sure management hands have presided over the finances of the dome, the letting of the new lottery contract and Oftel's control of prostitutes' cards in telephone boxes, and given the analogous delays in the development of the Financial Services Authority, what is the latest possible date for the commencement of the powers that the Secretary of State envisages?

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

First, let me say that we do not intend to put the New Millennium Experience Company in charge of Ofcom.

As for timing, it is proposed that we should seek to legislate to implement the White Paper at an early stage in a new Parliament—provided, of course, that we succeed in persuading the electorate to give us their trust.

Photo of Frank Doran Frank Doran Labour, Aberdeen Central

I welcome my right hon. Friend's statement and, in particular, his robust comments about preserving regional identity. He did, however, mention a fairly significant change in the way in which the system would be regulated. He talked of a lighter touch and of transparent self-regulation. Will he say a little more about how that is likely to operate in practice?

Will the existing licence conditions of Channel 3 companies continue in force? There is also the question of regional regulation. Does my right hon. Friend anticipate that Ofcom will have regional offices? Will it have a Scottish office, for example, and will it have a Scottish board member?

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

The maintenance of regional strength will be a matter for the second, not the third, tier of regulation. It will not be a matter for self-regulation; it will be regulated directly by Ofcom. Commitments will be expected, and commitments will be held to.

As we spelled out specifically in the White Paper, we will ensure that the needs and interests of viewers in Scotland, Wales and Northern Ireland, and in the regions of England, are taken fully into account by Ofcom. That will undoubtedly mean its having a regional presence.

Photo of Mr Dafydd Wigley Mr Dafydd Wigley Plaid Cymru, Caernarfon

Will the legislation be flexible enough to enable a Welsh broadcasting regulatory authority to be established? If not, how will the specific interests of Wales—particularly with regard to S4C—be taken on board? Will Ofcom have an office in Wales? Will the Secretary of State guarantee the operating freedom of S4C? Will he assure us that it will not be compromised by bureaucracy and that it will continue to be adequately funded?

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

We do not intend to make any change in the format of S4C, its statutory responsibilities or its funding system. We want membership of the consumers' panel to be drawn from all parts of the United Kingdom, and to include specific representation from Wales. As I said to my hon. Friend the Member for Aberdeen, Central (Mr. Doran), we intend to ensure that Ofcom takes particular account of the views, needs and wishes of people in both Scotland and Wales. Ofcom will undoubtedly have a place in the nations and regions of the United Kingdom.

Photo of Andrew Miller Andrew Miller Labour, Ellesmere Port and Neston

I welcome the unity of purpose between my right hon. Friends the Secretaries of State for Trade and Industry and for Culture, Media and Sport. Notwithstanding what was said by the hon. Member for Esher and Walton (Mr. Taylor), it contrasts starkly with what occurred under the last Administration. In April 1996, the right hon. Member for South-West Surrey (Mrs. Bottomley) said that we should not set in place a regulatory system for a fully integrated media market that does not yet exist.—[Official Report, 16 April 1996; Vol. 275, c. 543.] In fact, it clearly did exist.

May I ask my right hon. Friend what the relationship will be between Ofcom and the other regulatory bodies in relation to dominant players, especially when one of those dominant players is a large newspaper owner? Why should newspapers not be included in Ofcom's remit? May I also ask what relationship my right hon. Friend expects to develop between spectrum allocation under Ofcom, and the role of the Ministry of Defence? In peacetime, one would expect Ofcom to play a significant part.

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

The Ministry of Defence has its allocated spectrum. It would not be sensible to seek to take back some of that allocation on a purely temporary basis and yield it up at a time of conflict; such a system would be a nonsense. We have no intention of removing the MOD's responsibility in relation to its portion of spectrum.

The regulation of competition affairs in respect of newspapers will be governed by the pretty tough competition rules introduced by the Competition Act 1998. The role of Ofcom will be as adviser to the OFT and to the competition authorities. There is no proposal that competition policy should be relaxed in any way.

Photo of Roger Gale Roger Gale Conservative, North Thanet

My hon. Friend the Member for Esher and Walton (Mr. Taylor) indicated that many of us on the Conservative Benches have been promoting the cause of a communications development commission for a long time. When I came here this afternoon, I confidently expected the White Paper to be the realisation of those dreams. The long-overdue White Paper is in fact timid and narrow. It deals with nothing like all the subjects that should be covered by a proper communications White Paper, such as electronic press, e-commerce and all sorts of other issues.

The Secretary of State said that the White Paper provided a new framework of proposals for regulation. It is regulation, regulation, regulation. The word "development" is not mentioned once.

My hon. Friend the Member for East Surrey (Mr. Ainsworth) asked the Secretary of State—he did not reply; perhaps he would like to now—who Ofcom would be answerable to and what independent powers it would have. Is it independent or is it a Ministry of truth?

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

The hon. Gentleman clearly has not read chapter 3, where we set out in some detail our approach to e-commerce and to the development of the internet. I hope that, as he is reading it now, he will see that that is indeed the case. He obviously was not listening when I answered the hon. Member for East Surrey (Mr. Ainsworth) precisely. Ofcom will be answerable jointly to the Secretary of State for Culture, Media and Sport and to the Secretary of State for Trade and Industry.

Photo of Linda Gilroy Linda Gilroy Labour/Co-operative, Plymouth, Sutton

I welcome the White Paper, but is my right hon. Friend is aware that equipment that could legally describe itself as digital is being sold for as much as £2,000? What consideration has he given to some kitemark, or perhaps to bringing, through early regulation, the signal transparency to consumers that what they are buying will be able to receive the new digital communications?

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

My hon. Friend makes an important point. Many advertisements for televisions and for other equipment label them as digital in some shape or another although they do not receive digital television signals. We want to ensure that there is greater clarity for the consumer and that the consumer can have greater trust in the claims by manufacturers and retailers. I am in discussion with the Secretary of State for Trade and Industry to find out what steps we can take to tackle that problem.

Photo of Vincent Cable Vincent Cable Shadow Spokesperson (Trade and Industry), Liberal Democrat Spokesperson (Trade and Industry)

Can the Minister explain how cross-border regulation will develop as in paragraph 8.3, bearing in mind not only that many companies in satellite television, internet service provision and the rest are global rather than British, but that the Government agreed in Nice that the French should continue their national veto blocking international progress in that key area?

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

Basic requirements are already in place that have been agreed through the European Union. They include the television without frontiers directive and apply across the board to any Europe-based broadcaster or provider. The provisions that will apply specifically to Britain will apply to any broadcaster that is based in the United Kingdom.

Photo of Paul Goggins Paul Goggins Labour, Wythenshawe and Sale East

My right hon. Friend will be aware that, yesterday, the Secretary of State for International Development published a White Paper about the impact of globalisation on developing countries. Is he aware that the number of factual programmes about developing countries broadcast by the four main channels has fallen by 50 per cent. in the past 10 years? What action does he propose to take to increase substantially the amount of coverage?

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

It will not be for me or for government to dictate to broadcasters the precise nature of scheduling or programme content. However, what we can do, and what we do in the White Paper, is to make it very clear that, in our view, public service broadcasters—and that means not only the BBC but ITV, Channel 4 and Channel 5—must be in the business of providing high-quality, varied, mixed and challenging programme schedules. They should not be going simply for the lowest common denominator of popular entertainment. Although that must of course be part of what they provide, it must not be the sole content. That principle, which is what public service broadcasting is all about, is fundamentally enshrined in the White Paper. It will be up to the BBC governors, the boards of the other public service broadcasters and Ofcom to ensure that that occurs.

Photo of Mr Ian Bruce Mr Ian Bruce Conservative, South Dorset

On behalf of the European informatics market group and the all-party parliamentary and industry information society group, of which I am chairman, I thank both the Secretary of State for Culture, Media and Sport and the Secretary of State for Trade and Industry for their officials' co-operation with the groups. I hope that that co-operation will continue. However, I have yet to meet an official or a regulator—and I think that I have spoken to most of them—who believes that Ofcom should report to two Departments. Could both Secretaries of State please resolve the matter once and for all? The move will not be successful unless it involves only one Department.

I hope that the Secretary of State for Culture, Media and Sport will also commit himself at least to introducing a draft Bill on the matter in this Session. Clearly, all three main parties agree on what has to be done. If we at least had a draft Bill, when the Conservatives come to power, most of the work would be done and we could move quickly to implementing the provisions.

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

I certainly assure the hon. Gentleman that co-operation with EURIM will continue. I also tell him that co-operation between the two Departments has been extremely good and has produced a very constructive White Paper. I see no reason why that co-operation should not continue. As for the hon. Gentleman's final point, I certainly hope that we shall be legislating much sooner than the Conservatives ever getting back into power—a remote prospect indeed.

Photo of Derek Wyatt Derek Wyatt Labour, Sittingbourne and Sheppey

I would support a communications Department as a part of the proposals. If we have Ofcom, we will need only one communications Department. I hope that such provision would be included in a draft Bill.

There seems to be some confusion about one matter. If we are to have digital television internet access by 2005, but switch-over will not occur until 2006 or 2010, we will have to find a way of giving away digital boxes, perhaps by using a private finance initiative. We have to find some way of overcoming the digital divide. If we do not do so—and the White Paper does not deal with the problem—we will not be the most modern economy in the world.

If the BBC does not want to establish a public service education or sports channel, would Ofcom have sufficient money to commission one?

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

On the advent of digital television and internet access, of course digital television is not the only means by which people can gain access to the internet. It is, however, becoming an increasingly important means for people to gain such access, as the very rapid take-up of ONdigital's service, for example, is proving.

As for Ofcom's powers, it will not be possible, and nor should it be possible, for Ofcom to start up a channel or to enforce the start-up of a channel. What Ofcom will be able to do, however, is to do research, to provide encouragement, to identify gaps in the market and to advise broadcasters. I certainly hope that broadcasters will take account of the research that Ofcom does.

Photo of Peter Atkinson Peter Atkinson Conservative, Hexham

For the benefit of my constituents who still cannot receive terrestrial television, will the right hon. Gentleman confirm that "must carry on all platforms" provision will mean that, in future, ITV—which is Channel 3ITV2 and ONdigital will be carried on satellite? Could he also possibly answer the question asked by my hon. Friend the Member for East Surrey (Mr. Ainsworth) about whether he is proposing any changes in the cross-media ownership regulations?

Photo of Mr Chris Smith Mr Chris Smith Secretary of State, Department for Culture, Media & Sport, The Secretary of State for Culture, Media and Sport

We spell out that the public service provision—channels that are currently free to air on analogue, together with licence-fee funded free-to-air channels—must be available on all platforms. That is the "must carry" obligation that we have set in place.

On cross-media ownership, we spell out clearly the issues that need to be addressed. We also set out clearly the principles of diversity and plurality—plurality is extremely important in this respect—and invite views on how to proceed. I am sure that the hon. Gentleman's views will be among those that we will read with pleasure.

Several hon. Members:


Photo of Michael Martin Michael Martin Speaker of the House of Commons

Order. I regret that we must move on to the main business.