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Communications Bill

Part of the debate – in the House of Lords at 7:01 pm on 25th March 2003.

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Photo of Baroness Jay of Paddington Baroness Jay of Paddington Labour 7:01 pm, 25th March 2003

My Lords, it is a fascinating paradox of the Bill that it deals with the fastest moving, most rapidly evolving part of economy and yet, as the noble Baroness, Lady Michie, has just said, it has been a very long time in gestation. I agree with my noble friend Lord Gordon of Strathblane that that time has been very well spent, particularly in the pre-legislative scrutiny so ably led by my noble friend Lord Puttnam, which has been widely referred to by speakers today. I think that the point brought out by that scrutiny is that various points have been taken, dealt with and appropriately referred to and amended by the Government. However, I think that we have to return to some of the other issues that have probably either been put aside by another place or inappropriately dealt with.

I have two special interests to declare. I am a non-executive director of British Telecom and a non-executive director of the Independent News and Media Group. I also join the noble Lord, Lord Fowler, in being a member of the NUJ.

Like other noble Lords who have spoken, my most serious policy concerns lie in Part 3 and Part 5 of the Bill, particularly as they affect media ownership. However, before I speak about the media, I should like to touch on the immense importance of the telecoms industry, which is the subject of the earlier part of the Bill and has perhaps had less attention today. I am very glad that my noble friend Lord McIntosh will, I believe, focus on that industry in his reply from the Front Bench.

It has indeed been a long two-and-a-quarter years since the White Paper, and much has changed. As we heard, the so-called dot.com boom has gone bust. At the same time, however, the telecoms industry has faced static or, in some cases, falling demand for some of its other principal products and services. My noble friend Lord Gordon spoke of being unable to access broadband outside Glasgow. I should perhaps tell him that, just today, I was told that there are now 40,000 new connections every week. So broadband must be rapidly moving up even towards him. Some 42 per cent of the population—three times as many as in 1999—are now operating online. That is an enormous difference to the way in which people organise their lives. It also brings with it, as noble Lords are well aware, new social problems—the so-called "digital divide".

We cannot underestimate the fact that the UK's success in the 21st century will depend crucially on the telecoms industry. I do not think that it is inappropriate that the telecoms infrastructure is sometimes called "the central nervous system" of the whole new economy. Telecoms are also crucial to delivering improved public services. We know about e-government, but education and health are also now dependent on innovation in ITC systems. Our knowledge-based prosperity will grow only if we exploit the power of the converging technologies and, of course, ensure that they are appropriately regulated. Until very recently, the regulatory mantra for this sector of the economy was "light touch", but that has now been replaced in the Bill by the concept of "proportionality". I think that we need to wait to see how that concept will develop. It may indeed be one of the candidates for the post-legislative scrutiny that the noble Lord, Lord Fowler, suggested.

Fortunately, under its general duties, Ofcom is to have regard,

"to encourage investment and innovation".

That may turn out to be fundamentally important to expanding telecoms, at a time when many companies are suffering from sector-specific capital problems as well as global uncertainties. I think that there are some particular ways in which the Bill could be improved to encourage an environment of positive development in this area. Overall, however, I think that the proposals provide a realistic and balanced approach. If, as is intended, the Bill becomes law next summer, it will come into force at the same time as the new EU directives. I think that those directives, together with the Bill, will provide a very good platform for Ofcom to deal with what I think we will very rapidly be calling—pace my noble friend Lord Gordon—"The Broadband Age".

However, I expect that our debates in this House will be dominated less by the possibilities of broadband than by the current issues of broadcast. The BBC has been the focus of much scrutiny today. Unlike some of my political colleagues as well as members of the Opposition parties, I am content with the balance of the Bill's proposals on the regulation and governance of the corporation. I think that the new obligations to Ofcom sit well with the governors' continuing responsibility for the standards of public service. At this point I must congratulate Gavyn Davies, who, since he became chairman of the BBC, has reinforced the governing body's independence and capacity to meet its core tasks. As we heard, both the internal and the external regulatory arrangements will be reviewed in 2006 when the Royal Charter comes up for renewal. Until then, it seems sensible to allow the regulatory compromise time to develop.

Overall, I am anxious that the BBC should not be diverted from its role as the most successful public broadcaster in the world. Public service broadcasting, both by the BBC and, as we have heard, by ITV, has been rather like the NHS—one of this country's greatest contributions to the quality of people's lives for the past 50-odd years. As parliamentarians, I feel that we have a special role, to try to ensure that those high standards continue and strengthen into this century. That is why I am alarmed by some of the proposals in the Bill about the ownership, and therefore the governance, of commercial companies.

My first concern is the issue of foreign ownership—that is, extending the capacity to hold broadcasting licences beyond the European Economic Area—in other words, letting the Americans into our broadcasting business, as my right honourable friend Tessa Jowell readily acknowledged in the Second Reading debate in another place. As we are aware, the Government have advanced various economic reasons for allowing such American ownership. However, I agree with the words of the Joint Scrutiny Committee when it unanimously responded that each of those arguments "variously lacked force". We will no doubt return to those economic points in detail. Like the noble Lord, Lord Fowler, and other noble Lords, I will also want to raise the question of reciprocity.

In addition, however, I am perfectly happy to admit to a cultural prejudice against a huge number of imported American programmes that could be screened here by US channel owners and—this is the economic point—at marginal cost to themselves. The enthusiasts constantly tell us that we will have more "West Wing" and further versions of "Friends". My fear is that the mass of programmes would probably more closely resemble early evening viewing in, let us say, Des Moines or Detroit, and I have certainly experienced both. That would certainly be the best business case for any US owner.

The noble Lord, Lord Birt, whom many of us seem to be quoting this afternoon, put this succinctly in his seminal New Statesman media lecture in 1999 when he said:

"There is a risk to our national culture. We have already seen in this century the emergence of a global culture that is essentially American...The coming globalisation of media . . . may intensify this trend, undermining the uniqueness of national cultures".

I was therefore surprised that the Government rejected the proposals of the Puttnam committee to defer the issue of foreign ownership at least until Ofcom had established itself and been able to review the general questions of media ownership. If my noble friend Lord Puttnam or any other noble Lord proposes an amendment to give force to the Joint Committee's recommendation, I will support it.

I would also support amendments which could protect Channel 5 from a takeover by major newspaper businesses. Like earlier speakers, I am uncomfortable with the proposals to lift the so-called 20/20 restrictions on cross-media ownership. Again, I think the Joint Committee's recommendation to delay this change was very sensible.

I am attracted to the idea of a new plurality test to be used in connection with all mergers and takeovers across the media. In the same way as Parliament has a duty to try to promote high quality public service broadcasting, we must try to promote diversity of ownership. It may be a cliche, but it is none the less true, that we will maintain a vigorous democracy and vigorous political debate only if citizens receive information and opinion from the widest possible variety of sources.

My final point relates to another concern about the apparently all-powerful newspaper industry. As several speakers have said, the Bill has stimulated a vigorous debate on whether and how Ofcom should have any relationship to the Press Complaints Commission. The opponents of the debate, let alone of any change, have been led by various newspaper proprietors, journalists and editors crying "Censorship" from the rooftops. But recently one or two press voices have been raised expressing different views. In a recent article, Alan Rusbridger of the Guardian, acknowledged that,

"even the most vocal defendants of the PCC will privately admit to reservations about its workings".

Simon Kellner, editor of the Independent, has expressed his reservations publicly. In his evidence last month to the House of Commons Select Committee inquiry on privacy and media intrusion, Kellner said:

"I do not have any problem with some sort of press ombudsman who sits above the PCC, possibly under the umbrella of OFCOM, because there are real problems with the PCC . . . it should have more teeth, it should be less cosy".

In another place, my honourable friend Clive Soley tabled a new clause, which was not debated, giving Ofcom the function of reviewing the PCC. Mr Soley was advised that this was within the scope of the Bill, and it seems a fruitful area for us to explore. I expect to return to this issue as the Bill progresses.

In conclusion, I emphasise my overall welcome for the direction of the Bill and, in particular, the powers and responsibilities of the new single regulator. The Government are to be congratulated on introducing such all-encompassing and forward-looking legislation in one of the most important areas of 21st century life. My concerns—to borrow again from my noble friend Lord Puttnam—are to make a better Bill the best yet.