moved Amendment No. 235:
After Clause 294, insert the following new clause—
(1) Section 72 of the Copyright, Designs and Patents Act 1988 (c. 48) (free public showing or playing of broadcast or cable programme) is amended as follows.
(2) In subsection (2), after paragraph (b) there is inserted—
"(c) if that place is a licensed betting office."
(3) After subsection (4), there is inserted—
"(5) In this section, "licensed betting office" means premises in respect of which a betting office licence, within the meaning of section 9 of the Betting, Gaming and Lotteries Act 1963 (c. 2) (betting office licences and betting agency permits), is for the time being in force.""
The new clause would allow owners of broadcasting rights to charge for the use of their material when it is broadcast within a licensed betting office, otherwise known as a betting shop. At present free-to-air broadcasts can be used by bookmakers in betting shops for commercial gain without any financial return to the rights holders. This mainly affects horse racing, obviously, but it also has an impact on other televised sports.
The new clause is intended to allow owners of television rights to sports events to realise the full value of their assets in circumstances in which those rights are exploited for commercial gain by betting offices.
The best example of how the law puts a sport at a disadvantage is in the case of racing. Currently, approximately 11 per cent of races each year are broadcast via the BBC or Channel 4. These races can be shown in betting shops, as well as pubs and bars, as long as they do not charge for admission, without any payment either to the racecourses or to the broadcasters.
This free service is of some considerable value to betting shops. The televising of racing in this way has helped drive up betting office turnover by an estimated 30 per cent in recent years, which represents considerable money.
Since the introduction of the Copyright, Design and Patents Act 1988, television broadcasting in the United Kingdom has been transformed by the introduction of pay television in the form of either satellite or cable broadcasting. This has led to increased competition in the acquisition of broadcasting rights to live sporting events and accordingly increased the costs associated with those rights—many members of the Committee will remember the great deal of publicity given to the matter in recent times—making it imperative for broadcasters to be able to maximise the exploitation of the rights acquired.
An anomaly has arisen in that, under the current legislation, Sky and cable are able to charge, because their channels are encrypted, but free-to-air terrestrial broadcasters are not. This encourages rights owners not to allow sporting events to be shown on a free-to-air basis. This has to be contrary to the public interest, as I suspect the Government, as well as the Committee, will agree.
The history of this anomaly goes back some years—in fact, back to the middle 1950s. At that time, with the creation of the new broadcast right, hoteliers in particular were keen to ensure that they would not have to pay a fee to enable television broadcasts to be viewed by members of the public at a hotel or guesthouse. The eventual enactment of provisions to exempt broadcasts to an audience where no fee was paid was seen as a vindication of the rights of what became known as the "Scarborough landlady". This phrase was used by politicians at the time to describe the type of person who might have a television lounge in her premises and who would not wish to pay for the ability to show broadcasts to residents.
The noble Baroness, Lady Wilcox, finds this humorous. It is humorous, of course. We find ourselves in a ludicrous position, and I hope that the Minister, who said that she would be making some concessions, will make a concession on this matter.
In other words, the Government recognised and wanted to protect exploitation that by its very nature was incidental and inconsequential.
But the situation for racing cannot be described as inconsequential. It is estimated that for horseracing alone the value of the rights is a minimum of £3,250,000 per annum across the industry. Indeed, certain races—the Epsom Derby, which will be at the end of this week, and the Aintree Grand National, being two of the main ones—are clearly viewed to be of such national importance that they are listed events, and therefore virtually mandated to be broadcast on terrestrial television.
Annual betting turnover on the Grand National alone is in the region of £100 million. Betting shops may show the picture of the race free of charge whereas if the race were sold to a pay-TV operator they would have to pay a realistic market price for the right to make a commercial profit out of the pictures. That is surely unreasonably prejudicial to the legitimate interests of Aintree racecourse, for example. The same applies to the other 800-odd terrestrially televised races, which are high-profile, quality events generating significantly higher levels of betting turnover than lesser races and likely to contribute higher levels of profit to the bookmakers as a result.
It is fair to say that, as one would expect, there is no settled agreement between horseracing, bookmakers or broadcasters. In recent times, the whole area has been fraught with many problems, which have caused a great deal of dissent. I do not think there is any particular feeling by bookmakers that it is unjust to correct the anomaly addressed in the amendment. We suggest that there are good arguments for the Government to re-examine seriously the situation. Clearly, we have arrived at neither a logical nor a fair position.
There is unlikely to be another opportunity for the anomaly to be addressed in legislation in the foreseeable future. Therefore, as an alternative, the Government could offer to table their own amendment to allow the changes to be made at a future date, by order, perhaps, and with the agreement of all concerned. I beg to move.
I support the amendment, which, as we understand it, means that if a horserace is shown on television in a betting shop the owner will have to pay for that privilege. That seems to make sense. The copyright in a horserace belongs to someone; it can be owned. We can think of no reason why someone who runs a betting shop should have the right to take something owned by someone else simply because nobody is charged for admission to the betting shop. The fact that there is no charge for admission is irrelevant because the punter pays one way or another, but not by paying to get in. Bookies are making money out of punters and I can see no sensible reason why they should not pay for the privilege of showing a horse race in order to encourage more punters to come in. Bookies are not a special case. We should clarify the clause to make it clear that they are not entitled to disregard the ownership rights of those to whom the copyright belongs.
I hasten to add that I do not make any moral judgment; nor do I seek to prejudice bookmakers in favour of copyright owners. But a balance must be struck somewhere. There seems no reason why bookmakers should not pay the owners of copyrights for using copyright materials. It is as simple as that.
I ask the noble Viscount to withdraw the amendment. While having some sympathy with the case that he puts concerning what he regards as an anomaly, I do not regard the situation as an anomaly. He says it is an anomaly that, if a broadcast is made by Sky or a cable broadcaster, the racing fraternity can reach an arrangement on that broadcast and get paid for it, but, if it is free to air on the BBC or independent television, they cannot. That is not an anomaly; the same case applies to ordinary members of the public when watching television in their own homes. When the public enter a different place from their own home, such as a betting shop, they watch television on the basis of a licence fee having been paid and there is free access to television.
Why should betting shops fit into a particular provision? The noble Viscount says that it is because of an anomaly and that we should deal with it on the basis of the change to copyright royalty. But he will recognise that our reason for having copyright legislation is to protect intellectual property, and it is right that we should do so. If the investment in its creation is protected by copyright restrictions, it means that broadcasters can, for example, obtain royalties from making and selling videos of programmes and granting re-broadcasting rights.
However, it is not the broadcasters who are lobbying for this amendment. We have not had representations from broadcasters. The noble Viscount indicated that pressure comes from a particular interest; namely, those concerned with horse racing. I am not in any way, shape or form against the horse racing fraternity seeking to increase resources to enhance its sport. But I suggest that it is an inappropriate way to try to tackle the issue of additional resources. It is suggested that there should be change to copyright. That is not the issue; nor have the broadcasters ever thought that it was.
If I may be so bold, I am prepared to give the noble Viscount a hint as to where progress may be made. If the broadcasters were concerned, they could make representations on the matter. We have received none thus far. They could do so not by getting in touch with the DCMS but with the Department of Trade and Industry, the department concerned with copyright law. We have seen no reason why, within the framework of this Bill involving issues of broadcasting, we should address ourselves to that matter. We recognise that so far as concerns the industry there is a case. At this stage we are by no means convinced that it is an issue about copyright law. That case needs to be established.
I welcome the airing of the issue. I can only say at present that we do not regard our present proposals as producing an anomaly within the law. The important issue of free broadcasting is a cardinal point. I hope that the noble Viscount will recognise, therefore, why I ask him to withdraw the amendment.
I thank the Minister for replying so carefully and courteously, as he normally does. The noble Lord did not address the important point about the anomaly that Sky and cable television are able to charge because their channels are encrypted but that the free-to-air terrestrial ones are not, encouraging rights owners to avoid showing sporting events on a free-to-air basis. That is a direct result of that anomalous situation. It is clearly not in the public interest. The noble Lord and I recognise that as much high-class sport as possible should be available on free-to-air to those who pay the licence fee. That situation does not allow such freedom.
I intend to withdraw the amendment. Over dinner, the joke was made that should I be successful in gaining any concession my long-standing friendship with the bookmakers would be over. My long-term relationship with the bookmakers now continues; and, I hope, with the British Horseracing Board which has urged me to put forward these views. Perhaps we may revisit the issue on another occasion. I beg leave to withdraw the amendment.
In moving the amendment, I shall speak also to Amendments Nos. 239, 240, 241, 244, 245, 247, 248 and 249. With all those amendments, it sounds like a big debate ahead but the issue is important rather than big.
The amendment seeks to ensure that the code relating to the understanding and enjoyment of television by deaf and visually impaired people is kept up-to-date. We want the code to be reviewed every three years instead of the ridiculous concept of "from time to time". That could mean anything. It could mean "from decade to decade" or "from each half century onwards". We all agree that the pace of change of technology in the broadcasting industry is phenomenal and that the number of cable and satellite channels is growing rapidly. We should like the code to be kept up to date and regularly reviewed. A review every three years would ensure that it does not lag behind the latest developments.
Amendment No. 239 seeks to ensure that Ofcom takes an active role in raising awareness about subtitles and other services. I find it absolutely remarkable that many deaf people are unaware of the availability of subtitles, which could solve many of their problems in relation to television. They simply do not know about them.
This is illustrated by the fact that a little while ago a noble Lord approached me and asked how his wife could receive subtitles. I said, "With analogue, it is very simple. You press the text button, 888, and there they are. You are guaranteed them nearly all the time at peak hours. It is even easier on digital television". A little while later he came back to me and said, "It is miraculous. My wife's life is transformed. She can now watch television and understand it, which she could not do without subtitles". It is a simple thing but, before that conversation, this man's wife was unable to watch television and enjoy it. That was last year in 2002.
Equally remarkable is that there is virtually no publicity about which satellite programmes are subtitled. On all five analogue channels it is indicated very clearly which programmes are subtitled. That is not the case with digital television. So the many millions of people who rely on subtitles have to wait for the broadcast and switch on to see whether the programme is subtitled. If it is not, they simply lack comprehension of what it is all about. That is not good enough. People are entitled to know which programmes are subtitled and which are not to enable them to choose in good time.
The RNID estimates that nearly half a million elderly deaf and hard-of-hearing people are missing out on the benefits of subtitles—an astonishing figure. Undoubtedly Ofcom should take an active role in raising awareness. I hope that the amendment will be acceptable to the Government.
The proposal in the Bill to extend the requirements for subtitling, signing and audio description are welcome and marvellous as far as they go, but in the small print there is the absurd provision that the companies should be allowed 10 years to introduce them. Ten years? We can start a war and finish it in a couple of months. I hope that the Committee will find 10 years totally unacceptable.
Amendment No. 240 seeks to reduce this period to five years. I believe that we are being far too modest—five years is also an exorbitant and outrageously long period—but because we are reasonable and try all the time to accommodate the Government we have suggested five years.
I appreciate that the "relevant date" referred to in the clause is not necessarily the date on which the Bill will become operative, but it could be an earlier date. For example, for Channel 5 the date is 1st January 1998. Five years on, it is 1st January 2003. But Channel 5 is already subtitling 54 per cent of its output. In view of the remarkable developments in subtitle production, it would certainly be possible for Channel 5 to reach a figure of 80 per cent by the conclusion of the Bill.
The amendments' main targets are digital and satellite channels, which should never have been excluded from the Broadcasting Act 1996. It would be indefensible to give them a further 10 years before they are required to provide a comprehensive service to deaf and visually impaired viewers.
I suspect, although I have no proof, that cable and satellite lobbyists have been hard at work on department officials. That is just my own sense of what might have happened. Officials talk to Ministers and the word goes around. I can image the lobbyists pleading poverty, saying "Our profits will be damaged. Profits will be slashed if we have to subtitle programs. We will have to sell our grannies' jewellery. Even worse, we will have to send our wives out to work. That would be a disaster. Please don't insist on subtitling for all our programmes."
I hope that Ministers will see through those nonsensical claims of poverty and expense. The costs are relatively small—typically less than £400 for one hour of television, which is peanuts. Millions of pounds are spent on programmes, so £400 an hour is nothing.
Subtitling costs have fallen in recent years and are set to fall even further. Subtitling companies are using new software that significantly increases staff productivity, which is vital to bringing costs down and making it easier for companies. I saw voice recognition technology demonstrated five years ago. It worked then and it certainly works now. It is developing quickly and is already being used by some subtitling companies and the BBC.
Subtitling has become an intensely competitive business, so companies have been forced to reduce their charges to broadcasters. I was amused the other week to receive a letter from a subtitling company executive asking me to help him to find new markets. He wrote, "The reduction in subtitling charges has been brutal". Maybe brutal to him but I warmly welcome that cut. If I could, I would make it even more brutal.
Films are routinely subtitled at the time of their cinema release. Broadcasters can merely acquire the subtitling file so that the film can be shown with subtitles on television.
Those factors are all important and, in aggregate, they make providing subtitles a very easy option. I hope that Ministers will set their faces firmly against the lobbying and arguments made by company representatives.
Cable and satellite companies have greatly exaggerated the costs. If they want to maximise the audience for their programmes, why not use subtitles? By refusing to subtitle adequately, they are excluding deaf viewers. The pathetic subtitling currently offered discourages many deaf people. There are 8 million deaf and hard-of-hearing people. Not all of them use subtitling but many have an interest in it and should be catered for.
The BBC is committed to 100 per cent subtitling by 2008. The Federal Communications Commission in the US has stated that all English-language programmes first shown in 1998 onwards must be subtitled by 2006. Why should deaf and sight-impaired British viewers be the poor relations? It would be outrageous if the provision of full and adequate subtitling had to wait until 2013. It can and should be done earlier. I look to Ministers to accept what is a modest and reasonable amendment.
Amendment No. 241 seeks to buttress the two previous amendments and to ensure that more people know how to access subtitles on both analogue and digital television and should know in advance which programmes are subtitled. Amendment No. 244 seeks to reduce the number of exemptions for subtitling or signing or audio description by ensuring that a large broadcasting company is prevented from obtaining too many exemptions for some of its channels.
This is a complicated issue. Like the subtitling amendment, the amendment on exemptions is of profound importance to us. These are the two key amendments and I hope that the Government will be willing to accept them because they will be pursued at all stages of the Bill. The amendment seeks to try to stop Ofcom providing too many exemptions. Often, when people subscribe to digital, cable and satellite television, they have to buy a package of channels. It is therefore wrong and misleading for broadcasters to be able to plead that it is technically very difficult and that they cannot afford subtitling, signing or audio descriptions of one of their specific channels.
It is really a concern that the Government are considering exempting a large number of channels. They should think again because if exemption were granted to all channels with an audience share of below O.05 per cent it is estimated that fewer than half, that is, 66 of the total 150 channels, would be faced with the requirements. I believe that such a high figure is unacceptable. The case for very few exemptions is strengthened by the low cost of subtitling, which I mentioned a moment ago.
I am glad that Kim Howells in another place said that he sympathised with the spirit of the amendment. But we do not want sympathy for the spirit; we want support for the content. He argued that it would be at best burdensome and impossible in many cases for Ofcom to investigate the details of each establishment and the funding arrangements to determine whether exclusion was appropriate. Of course, it is not impossible. And it is hardly burdensome. Every commercial broadcaster has financial accounts and other information which is publicly available. It is impossible to accept the Government's excuses to exempt these channels. It would be burdensome on deaf and hard of hearing people if they do so. I hope that they will think again. The amendments are of profound importance.
Amendment No. 245 seeks to ensure that information which Ofcom already collects is placed in the public domain. The Bill will extend subtitling, signing and audio description requirements to some 150 channels, digital, cable and satellite. With so many it is likely that Ofcom will have to take on trust a great deal of information provided by the broadcasters. It will have to do that because there is no way round taking the matter on trust. Allowing this information to be publicly inspected would ensure that the public knew about it and would ensure full compliance with the legislation.
Finally, I refer to Amendments Nos. 247, 248 and 249. They deal with the omission of people who are deaf and blind from the provision for Ofcom to review the code giving guidance to deaf, blind and partially sighted people. Having one of these sensory disabilities inevitably creates problems. I know from personal experience how devastating total deafness can be. But total deafness and blindness to some measure must be unbelievably difficult. For those who are totally deaf and totally blind, clearly television has little to offer.
But many deaf blind people have the use of one of these faculties, which they should be able to maximise. It is for them that these amendments are intended. The amendments are put forward in good faith. If they are brushed aside by the Government a great number of people will suffer. If accepted by the Government, especially the amendments about subtitling and exemptions, millions of deaf, hard of hearing and sight-impaired people will be helped. I beg to move.
I support the amendments proposed by the noble Lord, Lord Ashley, in general and Amendment No. 236 in particular. I am amazed at the audacity of the civil servants that they have put this classic, this old chestnut, this out of "Yes Minister" wording of "from time to time" when referring to the frequency that Ofcom should review the code on the provisions for the deaf and visually impaired. That is surely too loose.
In such a rapidly changing industry, would it not be sensible to have a maximum period of time between reviews to ensure that the code does not fall out of date? As we have heard, as new technology becomes available, it is important that the code is regularly altered to reflect the situation on the ground. The cost of failing to alter the wording of the Bill in this way may well be that as Ofcom is stretched in different directions, it begins to interpret "from time to time" as "whenever it suits us" or "very rarely indeed" to the detriment of the disabled consumers who have much to gain from new technology, if only they were able to take advantage of it.
This is a group of amendments to which I have been waiting to speak for a long time. The noble Lord, Lord Ashley, has done a magnificent job of going through them all individually and explaining what is behind them. He has actually touched on a series of subjects which we in the disability lobby have all been talking around for a long time. The fact is that we should try to enact what we can on this issue and do it now.
The points about audio-description and subtitling are based on, shall we say, what we are capable of doing. What is the technology there for? The primary point of a 10-year wait is that it is a long term project, but it will not be dealt with or even thought about until it is a medium term project. Finally, it is panicked about in the short term and done badly. That tends to be my experience of these matters. However, we can do it now for under £400 per hour. That figure has been constantly quoted to me for the past three years. In real terms, the cost is falling.
That is a tiny percentage of the cost for virtually any television programme. On the issue of exemptions, I am grateful to the noble Lord, Lord Ashley, for tabling this amendment and for allowing me to add my name to it. This issue has been a bugbear of mine for a while. Within a huge package of channels designed for the age of multi-channels—effectively anorak TV—those who are hard of hearing should be allowed to indulge their passion for, say, programmes about World War II produced from old newsreels and using a voice over. They are cheap to make with possibly a very low audience. The same programmes are repeated again and again, giving hours of broadcasting, and they could be dealt with easily by one small package of subtitles.
What runs through this series of amendments is that they are all technically achievable now. If the Government reject the amendments, not only will they be picking a fight, but they will be saying that they will not do what is easily achievable.
I shall now do the reverse of common parliamentary practice by congratulating the department on including a clause in the Bill relating to provision for the deaf and visually impaired. But you cannot go to this party without taking more than one bottle with you; you must be there for the long haul. We must get the matter right now or we shall have to return to it again and again.
As regards the first amendment in the group, the noble Baroness, Lady Buscombe, hit the matter squarely on the head—the code must be reviewed regularly. Perhaps the expression "from time to time" has a wonderful legal precedent of which we have never heard which means that the code will be reviewed every two years and three months. But unless the expression means precisely that, the suggestion of a review every three years seems a valid one.
We are not talking about the cutting edge of technology. We know what we can achieve with the technology that is available. I hope that the Government will be prepared to take the amendment on board. They do not have to adopt its wording. I do not care who is carrying the standard so long as we win the battle. We want to get the provision into the Bill so that we do not waste time returning again and again to half measures. We can do it now. Let us do so and then forget about the matter and turn to something else. I support the comments made about the deaf-blind.
We on these Benches always listen with the greatest respect to the points that the noble Lord, Lord Ashley, makes. He spoke eloquently and movingly on behalf of the profoundly deaf, the hard of hearing and the blind. He also emphasised the other needs of the disabled which this part of the Bill appears to misunderstand. I join the support given to the amendments by the noble Baroness, Lady Wilcox, and the noble Lord, Lord Addington. I hope very much that the Minister will respond not only with sympathy but also with practical suggestions.
I hope that I may refer to a slightly unusual angle in supporting the noble Lord, Lord Ashley. I have spent the past six years visiting schools, particularly primary schools, looking at the way in which technology, when used well and with determination, can transform the lives of people who up until now have been excluded completely from society. The notion that for commercial reasons technology that is available is not being used to change people's lives is a very worrying comment on our society.
I support this set of amendments. When 5 million people regularly use subtitles and it appears from NOP research of January this year that another half a million deaf and hard of hearing elderly people could use them if they knew how to access them, the case for this set of amendments seems very strong. Cable and satellite channels have already been given three years' notice of the 80 per cent subtitling target, making the 10-year lead-in time appear excessive. As we have already heard, the cost of subtitling is cheap. It is getting cheaper and easier all the time so the case for exemptions seems unnecessary. As the noble Lord, Lord Addington, so ably said, it is possible to adopt the provision now. Let us do it. I beg the Government to support the amendments.
I support this group of amendments. I congratulate the noble Lord, Lord Ashley, not only on the way in which he presented the amendments but also on the way in which he has conducted his own life and, indeed, on the way in which he has done so much for the disabled generally.
I agree entirely with the comments that have been made. It is a far too modest suggestion that we reduce from 10 to five years the time for digital, cable and satellite channels to reach the subtitling target. We have heard mention of Channel 5 which I believe has managed voluntarily to reach a figure of 54 per cent in five years. Sky News has made a successful attempt in that regard.
The noble Lord, Lord Ashley, pointed out that the costs are reducing. They seem fairly low already. The price continues to fall due to significant advances in subtitling technology.
I got to grips the other day with DVDs. I was given for Christmas—that is probably the way to get me to get to grips with something—a collection of Audrey Hepburn films. I put my favourite, "Breakfast at Tiffany's", into the slot. Immediately appeared not only the title, but the possibility of seeing and hearing the film in about 20 different languages. It was amazing. If that is possible, it is clearly more than possible that the same will happen as subtitling technology speeds up.
Quite apart from the amendments helping the Government's "inclusive" agenda, there are surely bottom-line advantages to communications companies in attracting wider audiences. We have heard already the figure of 5 million regular users of subtitling. That is a considerable potential audience to attract to channels. An even more significant figure from NOP research this year is that the use of subtitling does not, as one would surely expect, increase with age.
As most Members of the Committee know, those with hearing impediments are already the largest group of disabled in the UK. As we are all living longer, and some deafness will almost inevitably appear the older one gets, those overall numbers will clearly grow. There is a potential market to be exploited.
It is sensible to ask that Ofcom's duties include ensuring that likely users of subtitling services, both analogue and digital, have adequate information promoted by all channels, that the services exist and—at least as important—how to find and access them. That is somewhat more difficult for the elderly, given the complex systems we all now try to grapple with, than for the younger generation.
To help ensure that we know how the policy is progressing, I suggest that Amendment No. 245, which proposes that Ofcom collate and publish information on subtitling on a yearly basis, makes sense. Even if I have made the case for the amendment mainly on economic grounds, it is of course a primary duty of all governments to ensure that we all have equal access to the everyday means of gaining information, education and entertainment. The RNID estimates that there are as many as 500,000 elderly people who are deaf and hard of hearing, and there are the visually impaired as well. They all miss out on the benefits of subtitling. As the RNID states:
"This represents a huge number of people who are experiencing a reduced quality of life—missing out on news, documentaries, sport and all the other information and enjoyment that television can bring".
I very much hope that the Government will be able to accept what I think are, in a way, far too modest proposed changes, and reassure many who fear that that group of disadvantaged citizens will continue to be sidelined.
My noble friend Lord Ashley of Stoke knows how much I sympathise with him and the issues that he has raised. I shall start with Amendment No. 236 and work through each amendment, as they are all rather different.
We would expect Ofcom to review and revise the code regularly, particularly as technical developments in the area can sometimes move quite fast. I would like to say to the noble Baroness, Lady Wilcox, that her attack on civil servants was completely inappropriate. However, the decisions as to the frequency of any reviews and revisions should ultimately be left to Ofcom, which will have the experience and expertise to judge when such reviews and revisions might be necessary. Giving Ofcom a duty to review and revise the code at least once every three years could put an unnecessary burden on it and I doubt that it would lead to a substantially different result. We should trust Ofcom. I believe that it will be committed to carrying out regular reviews in that area.
I turn to Amendment No. 239. The current duty is to give guidance as to the means by which the services should be promoted. I cannot see that the word "extensively" adds much to Ofcom's requirement. There is already a substantive obligation in Clause 298(1)(a) for Ofcom to provide guidance on the extent to which relevant services should promote the understanding and enjoyment of programmes in their service. The amendment would undermine it.
We have considerable sympathy with Amendment No. 241. It is in the service provider's best interests actively to promote the services they offer to hearing impaired and visually impaired people as these groups make up an important part of their audience—over 10.5 million people. However, I am aware that that does not always happen and that large numbers of sensory-impaired people, particularly the elderly, are unaware of the existence of subtitling, signing and audio-description and are therefore unable to benefit from them.
In complying with the code, Ofcom will have to give guidance on the extent to which services should promote understanding and enjoyment by people with sensory impairments. It is right for this guidance specifically to cover the need for service providers to make users aware of subtitling, signing and audio-description and of how to access them, and we will consider whether an amendment is necessary to the Bill to make this absolutely clear.
I have some sympathy with the underlying aim of Amendment No. 244, but it would be rather difficult to put into practice. First, the fact remains that the obligation to provide assistance to disabled people, and with it Ofcom's only lever, is on the licence holder, even if the service forms part of a family of channels. By the same token, the costs of providing the subtitling, signing and audio-description would fall on the licence holder rather than on the parent company.
Secondly, it would be extremely difficult and resource-intensive on a practical level for Ofcom to investigate the establishment and funding arrangements of each channel in order to consider the impact of its relationship with a parent company on any case for exclusion from the obligations. I must therefore disagree with my noble friend Lord Ashley of Stoke. I cannot accept this amendment.
I turn to Amendment No. 240. Following the review of the statutory requirements for subtitling, signing and audio-description, the report of which was published in January 2001, we believe that a 10-year period in which to satisfy these obligations is a target which for some will be quite challenging. But it is achievable. This target will give those services with new obligations, like digital, cable and satellite services, enough time to plan for their introduction. The time-scale does not mean that there will be no subtitling on those channels until the end of the 10-year period. Ofcom will have the ability to set interim targets on the way to meeting 10-year targets, as the ITC currently does, so provision of subtitling, signing and audio-description will grow year by year.
We do, however, understand concerns expressed that 10 years is a long time and that early progress should be expected. The arguments are particularly strong in relation to subtitling, which is a well established technology that can already be provided at a relatively low cost—I agree with what was said about that—and which is likely to become cheaper to provide as new developments such as voice-recognition come on stream. Again, I accept the arguments in that regard.
We do not believe that it would be right to reduce the overall 10-year timetable for the reasons that I have already given. However, we will consider amending the Bill to set out a fixed, interim five-year target for subtitling, which would apply to broadcasters with new requirements to provide subtitling rather than leave the matter to Ofcom. A challenging five-year target would allow progress on providing subtitling to be accelerated in the early years. That would ensure that those broadcasters with new requirements in that area could catch up as quickly as possible with those already providing subtitling, and it should help to lead to a dramatic increase in the amounts of subtitling available over the period. We will consider the details further and come back with an amendment on Report.
As the Bill now stands, Ofcom must consider the extent to which codes made under this part of the Bill have been complied with in carrying out its annual factual and statistical report under Clause 351. It will be for Ofcom to decide the appropriate level of detail that should be included in its report, and I am sure it will consider the arguments for providing as much information as possible so that people with sensory impairments can properly assess the levels of provision on different services. I am not therefore persuaded that an amendment to the Bill is necessary.
I turn to the remaining amendments in the group. I know that people with a dual sensory impairment can have sight and hearing loss to such a degree that it leads to problems with accessing information. Specialised means of communication, such as the "deafblind manual alphabet", have been developed for people who have significant impairments to both their sight and hearing. Those means are not particularly well suited to television and realistically, as my noble friend Lord Ashley said, a person would need to have some form of hearing or visual ability in order to enjoy or understand that medium. In such a case, the current duty to promote understanding and enjoyment for people who are hearing impaired and visually impaired should satisfy any need in that respect, as should the existing duty on Ofcom to ensure that the code drawn up under Clause 298, or any revision to it, is accessible to persons who are deaf or hard of hearing and blind or partially sighted.
Those people with a more serious dual sensory impairment clearly have specific needs. I am aware that the talking teletext service is particularly useful for them and I wonder whether concerns about the future of that service after digital switchover may lie behind the amendments. We had a full discussion of that issue at a previous sitting and I shall not repeat what was said then.
We have taken into consideration the needs of people with disabilities throughout the development of the Bill, including in relation to the provisions on television services for the deaf and visually impaired, and I believe that the measures that we have introduced represent a significant improvement. I hope that my comments have reassured noble Lords that we take these issues seriously and that we are willing to consider changes to the Bill.
I must say how much I appreciate all of the contributions from the Back Benches. To have unanimous support for the amendments from all sides of the Chamber is very significant. I am sure that my noble friend the Minister will have taken note of that, particularly because we have seen only a very small sample of our actual support. I am very grateful; there were some marvellous speeches.
I greatly appreciate the tone of my noble friend's answer. She is obviously sympathetic but there are limitations within the department. She presented the Chamber with a mixed bag. Some proposals were very welcome. I was so glad to hear them—they were heart-warming. I was sorry to hear an apparent determination to dig in heels on exemptions because that is one of the arguments we must win. We simply cannot have such exemptions; that is out of the question. I am afraid that, much as I respect and appreciate the difficulties of my noble friend in the department, this issue will be pursued at the proper time at every possible level and I may test the opinion of the House. In the mean time, I appreciate the Minister's difficulties and I beg leave to withdraw the amendment.
In moving Amendment No. 242 I shall also speak to Amendments Nos. 243 and 250. It is a small group of amendments which deals with the particular problem of audio-description. It is a crucial service for the blind and the visually-impaired. For them it is a necessity not a luxury if they are to enjoy television.
The present situation is that the BBC, ITV and Channels 4 and 5 are producing audio-description and transmissions over the digital terrestrial platform, Freeview, which were received at the last count in 65 homes. An enormous amount of money has been spent by the BBC internally, and externally by the RNIB, yet audio-description is only available in 65 homes. I understand that they are trial modules, but that means that the uptake is derisory.
There is no requirement for an expensive module. We do not need a module to receive audio-description. We should compare and contrast the situation that I have just described with that of Sky TV. I understand that in later debates the owner of Sky may be coming in for a certain amount of mention. However, in the area that we are discussing we should acknowledge the efforts that Sky has made. Entirely on its own initiative it is providing audio-description on the digital satellite D-sat without the need for a module. Seven million Sky homes have that capability and 3,000 hours a year of audio-described programmes are provided on Sky One, Sky Sports 1, 2 and 3, Sky Movies Max and Sky Premier.
Why do not the other channels use that function on the satellite platform? If they did they would increase access from 65 homes to a very substantial number. The reason for not doing that seems to be the cost of providing the additional audio bandwidth required to simulcast their existing audio-description on satellite. I understand the problems and I understand that, for example, the BBC might need 18 channels because of all its regional output. It is hard to find out the cost of that extra provision, but even if it were some hundreds of thousands of pounds per annum, how would that figure compare with over £2.5 billion of licence fee, £100 million on BBC 3 and £50 million on BBC News 24, which are both watched by audiences of a tenth of 1 per cent of UK TV viewers?
However, I understand that things are moving—or could move—on the module front quite rapidly. It seems that the marginal cost of adapting set-top boxes to accommodate the functionality for audio-description is coming down extremely rapidly. I have heard a figure of under £10 for the marginal cost of adaptation. The ideal situation would be for all set-top boxes, whether for satellite, digital or whatever, to include the chip to generate audio-description. The uptake would quickly make it apparent which form of audio-description the visually-impaired audience prefers. I have a simple question to ask the Minister at this stage. Does the Bill as drafted permit Ofcom to lean heavily on the manufacturers and the broadcasters to ensure that the solution that I have described can be obtained, so that there is a real service for visually-impaired viewers?
I understand that there is a commercial problem in that the BBC has spent a great deal of money internally on its system. Of course, as I have described, Sky has its channel for narrative. All this needs a catalyst—or someone—to kick-start the process. I should like to know whether Ofcom would have the power to do that. We lead the world in this area of technology and there should be a commercial opportunity, if only we can get things started.
Finally, there is an important factor to be taken into account by Ofcom; namely, the measurement of audio description. Let us take as an example an episode of "Midsomer Murders" on ITV 1. The most important fact is that broadcasters must concentrate on producing new material for audio description, not simply regurgitating the same few programmes again and again. So if an episode of "Midsomer Murders" is audio described on ITV 1, that counts towards its quota. When it is repeated on ITV 2, that also counts towards the quota. When it is sold to UK Gold, that also counts towards the quota. Therefore, in a short period one programme, audio described, becomes three.
The percentage therefore—whether it be 10 or 50—must relate to each channel. Each channel must generate its own individual quota. Any programme which already has audio description on it must by law be broadcast but not count towards the quota. Ofcom must introduce a licensing system that acknowledges which programmes have been audio described and then which channel can count against the quota. Finally, Ofcom must check with blind people and their organisations about the programmes they choose to describe. I am told that Granada chose as one of the two shows it audio describes what was coming up on Granada this week. It audio describes to the visually impaired all the programmes they cannot enjoy—it lists them but they are not audio described.
Amendment No. 242, which leaves out "10" and inserts "50", is a probing amendment. The figures would be a reasonable target for the main broadcast channels, but I accept that there would have to be a lower figure for the smaller channels. That should be at the discretion of Ofcom.
I want to comment briefly on Amendment No. 250, standing in the name of the noble Lord, Lord Addington, who I am sure will want to speak about it in detail. It would require Ofcom to include the minimum access requirements for disabled people and the best practice guidelines in the proposed code of practice for electronic programme guides. Easy access to electronic programme guides is essential if disabled people, and the millions more who struggle to navigate digital TV, are to be equal participants in the digital revolution and not be put off from switching to digital. I beg to move.
I support the principle behind the amendment but suggest that some sort of compromise position should be reached. The cost of audio description at £700 an hour cannot altogether be removed from the equation, although in an ideal world all programmes would be accessible to disabled people in a wide number of formats. A requirement that it should apply to 50 per cent of every service would be crippling to smaller channels.
On the other hand, it is clear that many large national and international channels can and should fork out such sums. The positive example set by Sky with respect to disabled access, warmly referred to by the noble Lord, Lord Carter, shows that in the case of large broadcasters where there is a will there is a way. During the course of our debates on the Bill we have constantly been made aware of the fast-pace progress that is typical of the industry. A target for audio description as low as 10 per cent from the 10th anniversary of the relevant date is too low.
I would therefore encourage Ofcom to take into consideration the ability of different broadcasters to afford to pay for audio description when issuing the code on the provision for the deaf and visually impaired.
I want briefly but warmly to support this group of amendments. I well remember the frustration of failing to get the target of 50 per cent written into the Broadcasting Bill seven years ago. The Minister says that 10 years is a long time—incidentally, I greatly welcome what she said about subtitling—and seven years is long enough. Is it not disgraceful that if seven years ago we felt that 10 per cent was an inadequate target, it should still be only 10 per cent? I believe that we should be aiming for 50 per cent in this Bill. It is not just 2 million visually-impaired people who would benefit from this. The ITC research shows that many older people with cognitive problems or younger people with learning difficulties would benefit. I support what the noble Lord, Lord Carter, said about Sky TV and the audio description programmes.
The current wording in the Bill leaves the inclusion of access requirements in the code to the discretion of the regulator. Given that the electronic programming guide is the key to digital TV, it must be made accessible to visually-impaired, disabled and elderly people. I very much hope that the Minister will have a change of heart on this point. If Ofcom left access standards out of the code, it would then be difficult to challenge on it. I hope that the Minister will look sympathetically on this group of amendments.
After watching us wield clubs, the noble Lord, Lord Carter, has come forward holding an olive branch. Once again we come down to the fact that the technology in audio description is well-established. There has been a monumental cock-up in actually getting access to the service. To offer kisses as opposed to kicks to Sky is rare on these Benches but here I freely do it. Sky has shown it can be done. As the noble Lord said, we just have not got ourselves together. The technology is there but we have not had the will or the co-ordination to make sure that a perfectly well-understood service has not been accessed. It is an absurd situation. If something has to be done to address this issue in primary legislation, we should do it. We cannot allow this state of affairs to continue. I have heard that everyone thinks that the position will improve. Why did we get into this mess in the first place? There are thousands of hours of broadcast audio description but nobody can receive it. That really is Gormenghast and Alice in Wonderland and wasting money with it. I do not know how we got there.
The noble Baroness, Lady Darcy de Knayth, has given a wonderful description of why the subject matter of my amendment has to be included somewhere. If people do not know about it, there is no point in having it. Audio description fits the present situation. I hope that the Minister can at least meet half of the problems, as she was able to do with regard to the previous group of amendments. The Government should take a firm lead or appoint someone who will. This situation is absurd. We have a chance to solve it and I hope that the Government seize that opportunity.
I rise briefly to give my warm support to my noble friend Lord Carter. I thought he moved his amendment wonderfully well. The Committee will be struck by the similarity between the arguments for subtitling and audio description. The question of cost is crucial. While I understand the reservations of the noble Baroness, Lady Wilcox, I would not place great store on that. Relatively speaking, the costs are low. My noble friend Lord Carter is quite right in his contention, especially taking into account the billions of pounds involved. The noble Baroness, Lady Darcy de Knayth, mentioned the previous Broadcasting Bill which in many ways was botched. There were far too many omissions. The Government say that we should discuss those at some other time. That is not good enough. It is time to act. We can correct at least one of the shortcomings of the previous Bill.
The argument for modules sounds quite convincing. I cannot claim to be an expert on this subject but my impression is that it is a red herring. There is no significance in the module argument but that is a matter for the Committee to decide.
My final point is that what we decide tonight, on Report and at Third Reading will affect people who are sight impaired. They want audio-description because it means so much. They cannot see the programmes. They need a voice to explain and to put things in context. There has been an enormous advance. If we do not accept the amendments they will just keep doing without. If we accept the amendments we can take a really good step forward for them. I hope that with her usual care and consideration the Minister will be able to go some way towards understanding and will accept the amendments.
Through the amendments we have the opportunity to be imaginative in using available technology for the benefit of those of all ages who have disabilities. The noble Lord, Lord Carter, has been fair in drawing attention to the potential costs of doing that. The noble Lord, Lord Addington, and the noble Baroness, Lady Darcy de Knayth, have expressed reasonable and understandable frustration. The general thrust of the amendments is supported from these Benches. I hope that the Minister will find a way to accommodate some of the points the amendments express.
My noble friend Lord Carter will know that, just as with the previous group of amendments, I have much sympathy with the issues raised in this group.
As regards Amendment No. 242, as I am sure my noble friend is aware, the 10 per cent target for audio description was considered as part of the review of the statutory requirements for the provisions of subtitling, signing and audio-description. Having considered all the issues and arguments during the review we concluded that the 10 per cent target should be maintained.
The decision recognised the unresolved production and distribution difficulties with the audio-description modules needed to receive the service. The Government have been working with the RNIB, broadcasters and manufacturers to help identify possible solutions to the problems. We are disappointed that the current problems have not yet been solved.
My noble friend Lord Carter asked in particular about audio-description systems currently offered by BSkyB on satellite. BSkyB currently provides a limited number of audio-description on some of the 300 channels broadcast via satellite but uses a different transmission system which is suitable only for high bandwidth delivery platforms, such as digital satellite. I do not entirely understand this technology. However, I understand that requiring broadcasters to transfer their existing audio-description to a pre-mix audio description system as used on digital satellite for terrestrial transmission would reduce the number of programme services which could be transmitted. It would also be very expensive and would hinder the development of the receiver-mixed audio-description system which has many advantages and could be applied to all digital platforms. So there are technical problems about the question raised by my noble friend Lord Carter.
My noble friend also asked whether the Bill as drafted would allow Ofcom to lean on manufacturers. As we debated earlier in Committee, the Government have agreed to consider the question of how we might strengthen Ofcom's responsibilities in regard to access to systems. We are actively considering that at present and shall return to it on Report. I hope that that is helpful.
I return to the question of targets. Clause 301 allows the Secretary of State, after consultation with Ofcom, to vary the target percentage for audio-description by order. So, even though the target is currently only 10 per cent, if there were the significant advances that we all want to see in the technology and more widespread take-up of the modules, targets could be increased. I very much hope that that will be the case.
In the same way as the ITC code currently does, we expect that Ofcom's code relating to provision for the deaf and visually impaired will include guidelines on the technical standards to be attained for audio-description, as well as the subtitling and signing, in order to meet the current standards. Amendment No. 243, therefore, would not really appear to lead to any different result.
I turn to Amendment No. 250. As we have said before, EPGs can make both the selection and recording of programmes much easier, enhancing the viewing experience in the process. This is just as true for people with disabilities as it is for anyone else, provided they can use the EPG.
Having considered the amendment quite carefully, I can understand the concerns of those who would like Ofcom to be under a more specific duty here, and I should like to return with some suggestions on Report.
I hope that in the light of what I have said my noble friend will be able to withdraw his amendment.
I am sure that after all our years of working together my noble friend the Minister would be extremely surprised if I sought to divide the Committee. There is time between the Committee and Report stages for reconsideration, and then we can decide what to do on Report.
I should like to pick up the point made by the noble Baroness, Lady Wilcox. I said that 50 per cent would be crippling for some broadcasters, but not for others, and there would have to be some discretion. There seem to be two systems on offer; there is almost a technical battle going on. We must be sure that the best is not made the enemy of the good. Ofcom should have the power to try to resolve the problem.
My noble friend the Minister referred to the unresolved production difficulty. I hear that this is on the verge of resolution. It should be possible for a very low cost—I am told as little as £10—to put the chip into new boxes so that they would all then become available. There is the lift-off problem in getting the number of modules out in order to have the production run and bring the cost down. This is just the area where Ofcom should be working.
I am extremely grateful to my noble friend for her helpful reply, and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 243 to 246 not moved.]
Clause 298 agreed to.
Clause 299 [Procedure for issuing and revising code under s.298]:
[Amendments Nos. 247 to 249 not moved.]
Clause 299 agreed to.
Clauses 300 to 303 agreed to.
Clause 304 [Code of practice for electronic programme guides]:
had given notice of his intention to move Amendment No. 250:
Page 269, line 11, at end insert—
"( ) The code must include minimum requirements and best practice guidance on making electronic programme guides accessible to people who are blind, partially sighted or have other disabilities."
moved Amendment No. 250A:
Page 269, line 11, at end insert—
"(2A) The practices required by the code must include, where there is more than one version of a public service channel available on an electronic programme guide—
(a) compliance with a request from the provider of a public service channel to substitute either—
(i) the appropriate version of that public service channel as designated by the provider of the channel; or
(ii) the version of that channel selected by the viewer for substitution; for the most prominent listing of that public service channel in the relevant electronic programme guide;
(b) ensuring that, where the provider of the public service channel consents, the consumer can perform the type of selection described in paragraph (a)(ii).
(2B) In assessing the degree of prominence for the purpose of subsection (2), OFCOM must ensure that—
(a) such prominence amounts to a degree that is greater than it would have been without the giving of such guidance; and
(b) the degree of prominence at least matches the degree of prominence in existence at the date of the commencement of the Office of Communications Act 2002 (c. 11).
(2C) For the purposes of this section there is more than one version of a public service channel available if, in the service of television programmes provided, there are different programmes being broadcast or distributed at the same time for audiences in different areas, regions or nations of the United Kingdom in the same service.
(2D) OFCOM shall perform its duty to draw up a code under subsection (1) within six months at the latest of the commencement of this section."
In moving this amendment, I wish also to speak to Amendments Nos. 250B, 250C and 250D.
The amendments together have a straightforward but crucial purpose of ensuring that viewers have easy access to their public service channels on digital platforms. They would tighten up the definition of "due prominence" to ensure that when, for example, a viewer in Scotland switches on BBC1, he gets the Scottish version.
Throughout the debate on the Bill, your Lordships have stated your strong support for the UK's public service broadcasters and the role they play in British society. Parliament and the viewers expect special things from their public service channels—the BBC, ITV, Channel 4, Channel 5 and S4C. They require them, as we have heard, to broadcast impartial news, high quality drama, documentaries, arts programmes and minority interest programmes. That is because as a society we believe there is public value in such programmes being easily available and free at the point of consumption.
On the previous amendment to be debated, we heard of the importance for people who are partially sighted or hard of hearing of accessing those channels via the electronic programme guides. The concession that the Minister made was an important one, because she agreed that their use was essential to enhancing the experience of viewers who want to access digital channels. They are the navigation systems for digital television—a combination of the Radio Times and a channel selector. The owners of those guides control where the channels are listed. That has a crucial bearing on viewers' ability to find the programmes that they want. If they cannot find them, they cannot watch them.
As Members of the Committee will have heard in previous debates, every digital platform has its own monopoly EPG. As the UK moves towards all-digital television, it is essential that those monopolies are regulated in the wider public interest. That is a particularly important requirement in the case of the satellite EPG operator Sky, which has its own pay-TV channels. It cannot be allowed to dictate how easily viewers can find the PSB channels that Parliament has established. It would be like allowing newsagents controlled by the Sun to put broadsheets on the top shelf.
Subsection (2A) of the amendment provides that, where a public service broadcaster has regional versions available on an electronic programme guide—for example, BBC Scotland or BBC Wales—at the public service broadcaster's request, the provider of that guide would have to place either the regional version chosen by the broadcaster or the version selected by the viewer at that broadcaster's most prominent slot on the guide. It would also ensure that, where a PSB has approved the principle of viewer selection—for example, a viewer in London wishing to view his regional news—the provider of the electronic programme guide must provide him with the means to do so.
Subsection (2B) would set a minimum standard of prominence for PSB channels on an EPG so that it is not set lower than the current slots allocated to them. For example, BBC1 would be located at 101, BBC2 at 102, and ITV at 103. That would prevent the PSB channels being buried many pages down the guide among lifestyle channels, pay channels or even worse, as suggested previously by one Member of the Committee.
Subsection (2C) provides a technical definition of a regional service. Subsection (2D) would set a six-month deadline for Ofcom to produce a code of practice for EPGs.
In summary, the amendments seek to ensure that the great British creation of public service broadcasting is maintained for new generations of television viewers. We can do that only by ensuring that viewers can find the programmes that they want to watch. People expect to find BBC1 at 101 and ITV at 103. Scots expect to find BBC Scotland or STV on those channels.
I hope that Members of the Committee will agree to put the due prominence requirements into the code, not to give PSBs any advantage over other channels, but for the benefit of viewers all over the United Kingdom. I beg to move.
I have put my name to these amendments because I believe that we must ensure that viewers can get easy access to their public service channels on digital television, and, in particular, that citizens have easy access to their local, regional and national programmes.
We have heard a lot about the importance of EPGs. For the future, I stress that their importance cannot be over-stated. It is the navigation system for digital TV—a combination of the Radio Times and a channel selector. Owners of EPGs control where channels are listed. That affects viewers' ability to find the programmes that they want. If they cannot find it, they cannot watch it.
In the Broadcasting Act 1996, Parliament regulated EPGs by giving public service broadcasters "due prominence" in their guides, but did not specify what that means. As the noble Lord, Lord Avebury, has explained, the amendments will tighten up what is meant by due prominence of public service channels and extend the principle of due prominence to include regional and local variants of public service channels.
Can the Minister confirm that the obligation of due prominence for public service channels applies independently of the purchase of any other service? In other words, would it be unacceptable to insist on the purchase of any other service, whether conditional access or anything else, as a condition of meeting the obligation to provide viewers with access to the appropriate regional version of their public service channel through a duly prominent position?
If allowed, this kind of bundling of services would appear to frustrate the purpose of the Bill's provisions on EPG due prominence and would not be permitted, I hope, either by the ITC or under the new code that will be devised by Ofcom. Can the Minister clarify that point? Can the Government confirm that the obligation of due prominence of public service channels applies independently of the purchase of any other service?
During debate on the 1996 Broadcasting Bill, both Government and Opposition sought guarantees that control of a monopoly EPG could not be used to deny viewers their traditional easy access to PSBs. The then Minister, the noble Lord, Lord Inglewood, said:
"Let me once again state unequivocally that the Government are concerned to ensure that electronic programme guides are not used to distort competition between broadcasters. It therefore seems eminently sensible for the Bill to establish certain principles as it does".
He went on to say:
"Nevertheless, as I made clear in Committee, the Government intend to monitor the situation carefully. And should EPGs in the digital market develop in a way which makes further regulation necessary we shall introduce it".
Clearly recent developments demonstrate that as both the market and technology have evolved, greater clarity over the will of Parliament is indeed necessary. The ITC's regulatory code requires "due prominence" without, as we have already heard, specifying what that means and in the case of the current dispute between the BBC and Sky has not been able to rule, despite the complaint being made by the BBC on 7th April. Nor does the Act or the ITC code deal with the different regional and national versions of PSB programming. Yet surely Parliament, when creating due prominence, intended that it would mean that viewers in Scotland could get BBC Scotland, viewers in Wales BBC Wales, and so forth. Where PSB channels are available with national or regional versions, viewers' easy access to those channels must surely be the right version for them.
I suggest that the amendment strikes the right balance between the role of Parliament in determining public policy and the discretion of Ofcom, the independent regulator, in implementing the policy set out by Parliament. Amendment No. 250A makes it clear that "due prominence" means the level of prominence at the enactment of the Ofcom enabling Act, safeguarding the position of the PSBs, and requires EPG providers to provide regionalised services.
It does not fetter Ofcom's discretion over the prices or the technical mechanisms which will be applied. These detailed regulatory matters are properly matters for Ofcom. But it is essential that Ofcom considers these detailed issues against the backdrop of clear public policy. Parliament has determined that EPGs should be regulated. It now needs to make sure that the new regulator, Ofcom, has a clear understanding of its intent behind that decision.
I hope that the Minister will be able to respond positively to the amendments and will be able to confirm my specific point about bundling of services.
I think that we are in complete agreement about the objective that we all seek: that is, a proper prominence. "Due prominence" is a term of art for public service channels, in particular the BBC on EPGs.
Having said that, one has to be alarmed that when we talk about balance we are also talking here about a set of amendments put down by one of the two parties to the present dispute which is raging—the BBC. I have considerable reservations about the route it has gone down. At least in this amendment, unlike the one proposed earlier, it is not trying to fix the price paid—
I should have said that they have been inspired to put down these amendments by a briefing from the BBC, which we have all seen. Of course noble Lords are quite entitled strongly to agree with that. I have done so myself on many occasions. I was merely explaining—
I have absolutely no criticism of that. But, if there is a dispute and one party wishes you to put down amendments, you should look at that carefully, just as you should look at the arguments of the other side.
I believe that these amendments go too far in seeking Parliament to resolve technical issues which are highly disputed between the parties. Whether or not one party is right I am not qualified to judge, but the amendments go very far in determining the precise detail of what should be done.
I have a lot of sympathy with the amendments—I am in danger of getting into a polarised position—but I disagree with the noble Baroness, Lady Howe, that they strike a proper balance between what Parliament should do and what the regulator should do. Mostly this should be a matter for the regulator's expertise and knowledge. However, there is a case for bringing forward amendments which do not go quite as far as these but give the regulator a further nudge in the direction in which the noble Lord, Lord Avebury, and the noble Baroness wish to go.
At this time of night my final remark may be felt to be holding matters up, but I cannot understand why everyone believes that it is so horrifying to find themselves on a EPG next to the Playboy channel. My own experience suggests that they are much more likely to be found in that position than in most others.
I rise, I fear, to be accused of introducing a patent note into the discussions in that I suspect I am, in part at least, going to say something similar to what the noble Baroness may say from the Front Bench. That is because on this occasion I am not sure that we want to add to the difficulties that will face Ofcom by defining the matter quite as it is defined in the amendment. I have recently had a conversation with the chairman of Ofcom. I said that I hoped we were not adding too greatly to his difficulties by being too precise about all the things that he has to do in the first months of his responsibilities.
Having said that, I should emphasise that this is an extremely important issue because of the principles involved and, as has been alluded to, because those providing the service can effectively do great damage to individual broadcasters if they do not identify very clearly where the broadcasts can be found. It may be that there is a very simple answer, or the beginnings of a simple answer, by adding "Public Service Broadcasting" to the list that appears on one's screen—"Sport", "Music", "Entertainment" and so on—so that when you press the button for "Public Sector Broadcasting" you get a list of all the public sector broadcasts and where they appear.
If I rise at all today it is because I have already some practical experience of the difficulties involved, living as I do in Wales and receiving my television, in the only way I can in my valley, through my Sky dish. It is not quite as simple as some noble Lords have indicated. It has been suggested that those who live in Wales or Scotland simply have to have the appropriate programme for Wales or Scotland, but if you live in Wales you get S4C and if you do not speak Welsh you have to find an alternative.
I know now that by going to 184 I can receive English language television and not Welsh language television. But even then it is not all that simple because, if you turn on the regional programme at particular times, in Wales you frequently get Welsh club rugby on BBC. I watch it from time to time but it is not my greatest passion. If I want the alternative, I have to find my way to a channel in the 400s, which broadcasts the programmes that viewers elsewhere in the United Kingdom can watch—or switch to Ulster, where I can often find the kind of programme I want. All those channels are scattered throughout the system and their number is growing ever bigger.
I am entirely with the noble Lord, Lord Avebury, as regards the importance of the issue. I hope we can start with my suggestion of listing public service broadcasts with their channel numbers, which viewers can display on their TV screens and access relatively simply. However, the amendment may have shortcomings. We could be making Ofcom's job more difficult. This is one occasion when I would prefer to leave it to the wisdom of Ofcom to interpret Clauses 304 and 305, which create the code and the means of enforcing it. If Ofcom is as efficient at regulating as I hope it will be, the problem will be solved.
On this occasion, I take the risk of agreeing with the Minister. I do not go with the amendment but strongly support the important issue that it raises.
It seems a growing tendency in the Committee to consider what my noble friend the Minister is going to say before she has said a word. I have no idea what she will say but fully agree with the noble Lord, Lord Crickhowell, about the importance of the subject. I am slightly anxious, because of the hovering of Chief Whips, that we may be reaching the close of today's debate.
I am glad that that is the case and that we may reach other important matters in due course. I shall not delay the Committee unduly.
The purpose of Clause 304 is clearly to require of electronic programme guides that they give appropriate prominence to listing public service channels. Clause 304 implicitly accepts that the owners of EPGs may have good commercial reasons for giving favourable positioning to non-public service channels but in its reference to giving due prominence to public service channels the clause is not very precise. The noble Lord, Lord Crickhowell, says that the matter can be left to Ofcom. It will be a body of men and women, all good and true, who will do their best—but they will be guided by the Act. Is there any harm in giving it more precision than the little now offered by the Bill?
I find myself favourably disposed towards the amendments. Their value is in giving some precision where none exists and covering regional or local variants of public service channels so that they are easier to find. I do not see that as being over-prescriptive or over-precise but as giving precision where there is precious little now. I give no particular credence to the precise wording and I am sure that the government draftsman can do better. Nevertheless, the attempt by the noble Lord, Lord Avebury, and the noble Baroness, Lady Howe, to give precision where little currently exists is worth commending.
We all agree that the problem arises because of a lack of definition of due prominence and because of the difficulty of finding the channels in question even now.
I have a particular concern at the possibility that digital satellite viewers in Wales may not be able to receive, for example, BBC1 and BBC2 Wales through the electronic programme guides 101 and 102. It is for that reason that I believe the Bill requires amendment both to tighten the definition of due prominence on the EPG and also to extend it to national and regional variations of public service channels.
I make no apology for speaking about Wales in particular because its television audience is quite complex and diverse. Its take-up of digital television is higher than the United Kingdom average. Within the digital audience there is a particularly high proportion of digital satellite viewers, not least because of the difficult topography. Without being able to access BBC Wales on 101 or 102, instead viewers have to rummage around among the bottom rungs of the EPG, as the noble Lord, Lord Lipsey, has said, and only slots away, I am told, from the pornography channel, which may distract them.
Viewers may opt for non-Wales services for a host of reasons. That could result in large parts of the population having minimal access to information and news from and about Wales. We heard earlier today that a healthy democracy depends on people having many sources of information, which is a matter of great concern in post-devolution Wales where the BBC and HTV are one of the few providers of Wales-based news and so forth. So we may not be surprised at the 38.2 per cent turn out in the Assembly election, which has implications for democratic credibility. Therefore, it is vitally important that people should be able to access these services.
In an age when we are encouraged increasingly to view on the global level, it is vital that we still look to the local. The Bill has a duty not only to promote diversity and creativity, but also to safeguard the needs and interests of its many different audiences. In my view it is essential that we continue to connect with our communities by ensuring that they have proper access to the programmes and services which have most relevance and resonance in their lives.
These are some of the reasons why I am seeking reassurance from the Government that all efforts will be made to find a solution that ensures that viewers in Wales, and in the rest of the UK for that matter, have access to their correct national or regional variations of the BBC and ITV services on digital satellite. I urge the Government to support the amendment to Clause 304 that would ensure that that is made possible.
Having been accused earlier of being a supporter of British vagueness, perhaps I may say on this amendment that I support my noble friend Lord Borrie and the movers of the amendment in wishing to see a degree of prescription about due prominence and about the regional aspects of access which were discussed earlier by other noble Lords.
I hope that this is not introducing a particularly aggressive or antagonistic note, but my feeling is that some of this is about things other than the mechanical ability to be able to find a public service channel in a complicated technology. The noble Lord, Lord Lipsey, identified this as a BBC amendment—which is, as I said in my intervention to his point, unfair—but the prominence of this issue has come about because of the BBC's decision to use non-encryption for its digital services and to use a new satellite for that transmission.
Reference was made earlier today to there perhaps being some rather sinister point behind the fact that the BBC has not adhered to its original date of 1st June to stop encrypting its services. From making inquiries, I understand that this is because, far from being in some terrible war, as it were, with BSkyB on this subject, it is trying to negotiate an arrangement for the placing of its programmes on the EPG. At its May meeting, the ITC has not been able to deal with this issue and has asked that it be postponed in order that the rolling contract that the BBC has with BSkyB is continued until July. I think that reveals something about the inability of the regulator exclusively to deal with the matter at least in any urgent fashion.
There is a real issue here about the value that we place on public service broadcasting. We have all usefully spent a great deal of time in Committee today and on previous occasions trying to define what we most value in the public service remit and the qualities that we look for in public service broadcasting. We must be aware that there could be some form of retaliation in a public service broadcaster seeking to use other technical means to distribute its digital programmes by a commercially-operated, profit-driven satellite owner. It would be ridiculous if we did not acknowledge that.
We have said that we value public service broadcasting. That has been the consistent and universal view of Members of the Committee who have spoken today. We have given great attention to what we value in it, how we seek to describe it and how we recognise it. We must also recognise that in this global world, with satellite access often being in the hands of those who perhaps do not have the vision of public service broadcasting that we have discussed today, we must not only value it and enable it to be seen mechanically, but we must also protect it. Otherwise, I fear that we are perhaps in danger, by a process of unforeseen consequences, of agreeing with, or at least accepting, the view of Mr Rupert Murdoch which has been put before me recently, in which he said that he had,
"never heard a convincing definition of what public service television really is. My own view is that anybody who provides a service which the public wants at a price it can afford is providing a public service".
On the basis of the contributions made in Committee today, I do not think that that is the view of Members of the Committee. That is something from which we must seek to protect our television services.
I want to be brief. I have two very powerful briefs in front of me—one from the BBC and one from Sky. In a sense, I have tried to take a few steps back from two sides of a very powerful argument. My noble friend Lord Crickhowell and the noble Lord, Lord Borrie, have said that this is a very important issue because some important principles are involved. I rather like the idea proposed by my noble friend Lord Crickhowell that we should perhaps move towards a list of public service broadcasting channels so that we can easily find them. Perhaps we could do that when we have decided what public service broadcasting means.
On that point, we know that the BBC has been threatened with demotion on the EPG from 101 and 102 to 214 and 215. When I mentioned this to my teenage children, they knew immediately where that would put them on the EPG. To some extent, this is almost a generational problem. Young people do not consider this an issue. As far as they are concerned, it is all accessible, it is all more choice and it is all easy to access. However, I have enormous sympathy with the principle behind the amendments. We on these Benches have already made clear that we support the principle of due prominence. I agree that it is worthwhile nudging Parliament to give us a clearer definition of due prominence.
My understanding is that the proposed amendments to Clause 304 would tighten up what is meant by due prominence for public service channels so that EPG owners could not interpret that in any way that suited them. I also understand that the proposed amendments would also extend the principle of due prominence to include regional and local variants of public service channels so that EPG providers had an obligation to make them easy to find. I have every sympathy with that. Several Members of the Committee, particularly my noble friend Lord Roberts, explained eloquently why that is so important.
However, I wish to raise one concern. If we are talking about having due prominence for public service channels, that is all well and good at the moment but what happens as we move into the future? Amendment No. 250A concerns me as it seems that it would require that the prominence given to the BBC services, or public service broadcasting services, would be greater than it would have been without the giving of such guidance as is to be specified in Ofcom's code, and that the degree of prominence at least matches the degree of prominence in existence at the date of the commencement of the Office of Communications Act 2002.
Does that mean that public service broadcasters could claim that a code requirement for greater prominence entitles, for example, the BBC's new digital services such as BBC3 and BBC4 to be placed ahead of competitors such as E4 and Arts World which were given fair, reasonable and non-discriminatory listings in the EPG? I believe that that could cause concern not just among those who are passionate believers—as are the Committee and myself—in public service broadcasting but also among viewers. At the end of the day we have to think of the viewers. How are they supposed to discriminate between what we think of as public service broadcasters and something like Arts World which has all the character—if I can put it that way—of public service broadcasting? In that sense perhaps this approach could prove—certainly in the future as more channels become available—unfair, unreasonable and discriminatory.
I have real concern about how one would set the parameters in terms of easy access as we move into the future and have more and more choice. I am also concerned that we find ourselves being drawn into an argument between two particular parties at the moment. I have great sympathy with what the noble Lord, Lord Borrie, said; namely, that perhaps this question gives us an opportunity to nudge matters in the right direction and to obtain more clarity in Parliament with regard to what we mean by due prominence.
My noble friend Lord Borrie teased the noble Lord, Lord Crickhowell, and suggested that he predicted what I would say some time before I spoke. However, the noble Lord, Lord Crickhowell, was absolutely spot on. He predicted perfectly what position I would adopt. The matter raises a lot of important issues but the noble Lord is absolutely right that it has to be a matter for Ofcom.
I turn to the amendments that we are discussing. The proposed new subsections (2A) and (2C), which Amendment No. 250A seeks to introduce to Clause 304, relate to the provision of regional versions of some public service channels. As the Committee will be aware, the broadcasters that provide such regional versions have numerous listings on EPGs but which version of a channel is accessed through a broadcaster's primary listing is currently dictated by where in the country it is viewed. Hence in Scotland what the viewer simply selects as BBC1 is actually the regional variation BBC Scotland, whereas in London it is BBC London. That is no accident, nor is it inevitable. Rather it is an agreed arrangement borne of free commercial negotiations between the broadcasters and the providers of EPGs.
The intention behind proposed new subsections (2A) and (2C) appears to be to allow a broadcaster, or in some cases its viewers, to choose which version of the broadcaster's channel is accessed through the primary listing of that channel. That seems a perfectly reasonable goal, and I am not aware of any reason why it cannot be achieved at the moment. Indeed, if Ofcom saw fit to do so, Clause 304 would already allow it to set requirements as to the presentational aspects of EPGs to make sure that that was the case.
Therefore, my objection to the proposal lies not so much in the end result that it seeks to achieve, which seems perfectly legitimate, as in the means by which it seeks to do so. It would seek to set in stone something that should be left either to free negotiation or to Ofcom's discretion to resolve. Moreover, it would constitute a perfect example of the type of over-regulation that we have made great efforts to avoid in drafting the Bill. In my view, it would constitute a totally inappropriate use of statute.
My objections as regards proposed new subsection (2B) are broadly similar. In short, the provision would seek to determine through statute something that ought to be left to the discretion of the parties or at least the regulator. I have a further objection. What is proposed in paragraph (a) does not seem feasible. Members of the Committee need only apply the wording of the paragraph to BBC1 to see what I mean. It already appears as the 101 listing at the head of the most commonly used EPGs, and I am not aware of any 100 listing, so I fail to see how Ofcom could ensure it greater prominence than it has at the moment.
If those behind the amendment seek confirmation that we want to make it possible for public service channels to be given more prominent places on EPGs than might be the case if matters were simply left to negotiation, let me assure them that that is certainly our intention. It is the purpose of Clause 304(2). However, as I said, it is equally our intention to leave it to Ofcom to decide what prominence a given channel should be afforded. It will have to take lots of factors into account, such as the degree to which the removal of a channel to a new part of the listing might inconvenience viewers. Ultimately, however, we want to leave the matter to its discretion.
I shall answer the question posed by the noble Baroness, Lady Howe. EPGs are now regulated by Oftel and the ITC. It will be for Ofcom to draw up a new single code on EPGs. However, I do not expect that the current provisions she mentioned, which basically seem useful, will be significantly amended.
I am afraid that proposed new subsection (2D) is unacceptable, too. Although it is natural that the affected parties want to know what lies in store for them, the regulation of EPGs seems set to be a pretty technical and complex matter. If it turns out that Ofcom is able to draft, consult and finally publish the code required by Clause 304, all within six months of the commencement of the clause, all will be well and good. Given the importance of getting the matter right, however, I see no reason to set what may well turn out to be an unrealistically short period for the accomplishment of what is, as has been said around the Committee, a very important task.
Amendments Nos. 250B and 250D are related. To date, the only services to which we have wanted to give the benefit of due prominence have been television services. Amendment No. 250B aims to extend that benefit to BBC digital radio services by adding them to the list of public service channels in Clause 304. That seems misguided. In contrast to television, there are no public service channels on radio other than those provided by the BBC. Affording those channels due prominence would create an imbalance between the BBC and commercial radio services. We do not believe that that would be appropriate when digital radio is still in its infancy.
Amendment No. 250D also relates to radio services. It aims to extend the scope of the clause to cover EPGs on radio. Since its effects would therefore be felt more generally, it would not create the sort of imbalance that it seems would result from Amendment No. 250B. I would be happy to take it away for consideration.
I now return to Amendment No. 250C, which would extend the list of services to be given due prominence to any of those provided by the Welsh Authority and not just S4C Digital. I agree that if the listing position given on an EPG is significant in attracting an audience, it is quite important for S4C that its viewers have easy access to the channel wherever they are in the UK. But I believe that the amendment is superfluous, as, if a new service is provided by the Welsh Authority, under Clause 202, subsection (4) of Clause 304 would allow the Secretary of State to add it to the list of channels benefiting from due prominence.
In light of my response to all of the amendments, I hope that the noble Lord will withdraw his amendment.
I thank all those who have spoken in the debate, particularly the noble Baroness, Lady Howe. I thank the noble Baroness, Lady Jay, for clarifying something which caused a little concern at earlier stages in the debate. I am sure that all your Lordships will be pleased to learn that there is a prospect of an agreement and that the reason why the BBC has not gone free to air for the time being is simply that it is allowing extra time in which an agreement can be reached in the dispute over EPG and that by July a solution will have been reached that will satisfy all concerned. We very much hope that that will occur.
I accept that it would be impossible for us to design a solution along those lines. What we have put forward is only an attempt at what all your Lordships said ought to be done; that is, to clarify further what we mean by due prominence. To that extent, I am disappointed by the Minister's reply and I can only comfort myself with the thought that, from everything that your Lordships have said, the Committee does believe that due prominence should include many of the elements that we have tried to insert into the amendment. When Ofcom considers the code, whether it takes longer than six months or not, presumably it will look at Hansard and, in the absence of any other guidance, see what your Lordships have said. That will help Ofcom to arrive at what it thinks the code should say about due prominence. For that reason, I am pleased that we have had the debate and I hope that it will have been of some service to those who will have to consider the issue in the future. I beg leave to withdraw the amendment.
moved Amendment No. 250E:
Page 270, line 5, leave out "the words from "except" onwards shall be omitted" and insert "for the words from "except" onwards there is substituted "and, in the case of a local licence, that an appropriate amount of local material is broadcast, of which an appropriate amount is locally made""
My noble friend Lord Eatwell apologises to the Committee for the fact that he is not able to be here this evening and he has asked me to introduce the amendments on his behalf, which is something I am very happy to do.
We are discussing local radio. Both Clause 306 and Clause 307 reflect the Government's desire to strengthen and sustain localness in local radio, which is something that would command widespread support. That is an objective which I believe is well served by Clause 306, but is ill served by Clause 307.
At Second Reading, my noble friend Lord Eatwell argued that Clause 307 was notable for the fact that it was injected into the Bill without any consultation whatever with those whom it was intended to regulate. He also said that it was damaging for a number of reasons. It creates a "one size fits all" regulatory code that will be irrelevant and damaging. I do not believe that anyone can say that one code can capture what localness means in relation to, for example, Capital Radio in London, which broadcasts to 10 million potential listeners, and Oban FM, which broadcasts to 15,000.
The thinking behind Clause 307 involves excessive micro-regulation of inputs into radio programmes but nothing for the outputs. It is ridiculous for Ofcom to be charged with ascertaining for every radio station in the country where their employees live. Surely it is unreasonable to ask Ofcom to do that, and reflects not a light touch but a heavy-handed approach. It is equally ridiculous that Ofcom should, for every radio station in the country, be required to regulate the amount of local advertising. That is surely best left to commercial pressures and skills. I cannot believe that the Government intend to persuade a radio station to turn away advertising. For example, would they want a large metropolitan station to turn away major national brands simply because it did not have that local element? That is not necessarily how advertising works and it would be inappropriate in this case. Is specifying exactly how a station should run its sales business what the Minister meant at Second Reading when she referred to light-touch regulation?
The simple point is that if localness means anything, it must mean diversity and variety. Clause 307 would work as much more of a straitjacket and should not stand part of the Bill. Fortunately, we already have a solution at hand in the Bill; that is, in Clause 306. The outstanding virtue of the approach to localness in Clause 306 is that it achieves its goals via the specification of format in the award of the licence. In other words, the specification of localness is tailored to local conditions. Instead of the straitjacket of a "one size squeezes all" code, Ofcom can secure and protect the local characteristic—the individual characteristic—of each station.
Moreover, Clause 306 places the weight of concern where it should be: with the listener. Clause 306 does that as it stands. However, my noble friend Lord Eatwell, who has had discussions with some DCMS officials, identified various concerns that are dealt with in Amendments Nos. 250E, 252A and 252B. Those amendments strengthen significantly the ability of Ofcom to specify local characteristics in a licence format. Amendment No. 250E makes localness a licence requirement. Amendments Nos. 252A and 252B ensure local production by requiring that an appropriate amount of material is made locally.
Amendment No. 252B also broadens the definition of what is "local material". At present, Clause 306 characterises that as material including news that is of particular interest to local people. The amendment broadens the definition of "local material" to include, "news, information or entertainment". I suggest that that far better reflects the diversity of the different ways in which different stations can be local. News is not the only way in which stations connect with their locality. They do so through the provision of local information about charities and events, as we all hear on our local stations, and through tailored provision of, for example, musical outlets, reflecting live music in the region, or discussion programmes and so on. I emphasise that the crucial power of Clause 306 strengthened by the amendments is that Ofcom may determine localness on a case-by-case basis. The use of the word "appropriate" in Amendment No. 250E permits different localness requirements to be set for different types of station. Those that serve a geographical community, such as Tower FM in Bolton and Bury, should be treated differently from those that primarily serve a community of interests, such as Jazz FM.
Localness is important. That is why people listen to their local station; and Clause 306, as amended, would allow radio to celebrate the diversity of localness. I beg to move.
I rise to speak to Amendment No. 254 and to oppose the Question that Clause 307 stand part of the Bill. Furthermore I support the amendment tabled by the noble Lord, Lord Eatwell, and spoken to by the noble Lord, Lord Dubs.
Clause 306 relates to the character and coverage of sound broadcasting services and amends Section 106 of the Broadcasting Act 1990. Clause 307 seeks to define localness for commercial radio purposes. It requires Ofcom to draw up a code and identify a substantive input requirement that could be covered with a view to maintaining and establishing connections between local sound broadcasting services and the relevant localities. The UK radio industry has enjoyed fantastic growth in the past 10 years. We need to provide a regulatory structure that will encourage growth and innovation in that fast-moving, converging media environment.
The regulatory regime proposed by the Bill for local radio places an onerous burden on the local stations within its remit. Clause 307 was not included in the draft Bill, and as a result was not considered by the draft scrutiny committee. The policy behind the additional clause concerns me greatly. If implemented, Clause 307 would grant Ofcom the power to micro-manage the day-to-day running of local radio stations. The clause is so prescriptive that it requires the local radio station to maintain premises within the area of locality, provide local training and development and employ local people. Surely the ability to perform a job should be a consideration when deciding to employ a person, not merely where that person lives. I emphasise that we are not questioning the validity of the overriding legislative objective that local radio stations should provide a local service. However, we do not believe that it is necessary to impose such prescriptive obligations on the local stations affected. Indeed, the concept of localness is entirely subjective. Perceptions of locality may vary for a number of reasons—language and culture for example.
Our philosophy is simple. A local radio station has to take into account the requirements and needs of local listeners. Commercial radio is not vastly profitable. The stations have to ensure that they are successful. If they fail to do that effectively they will not survive. The localness of a particular station will not depend on whether the employees live just inside or just outside the area in question.
The Bill is largely deregulatory in its approach. The general principle that underpins the Bill is self-regulation or co-regulation where possible, and only to impose a regulatory regime where necessary. Do the Government believe that the clause will advance that general policy? Do they not agree that the clause intimately defines how a local radio station should be run rather than setting out the purpose that should be achieved? The Government have failed to appreciate that localness would result from commercial demands alone and that a co-regulatory approach would provide a more efficient local radio broadcasting service that does not measure its success on input requirements.
We oppose the Question that Clause 307 stand part of the Bill. The Government have stated that Ofcom can choose whether or not to include the input requirements in the code, as imposed by the clause. That begs the question—why have a legislative obligation to compile a code at all? That is an area where self-regulation or co-regulation would be a more appropriate alternative. The service provider would be in a more suitable position to determine how best to further local interests and local culture.
Amendment No. 254 requires Ofcom to have regard to the extent to which the various requirements of Clause 307 are being satisfied by self-regulation prior to drawing up or revising a code. That would encourage local radio stations to comply with the spirit underpinning Clause 307 through self-regulation. The inevitable result would be substantial compliance, where appropriate, with various conditions set out by the legislation. In addition self-regulation or co-regulation would place less of a financial burden on Ofcom, and I urge the Government to consider the significant advantages that a less prescriptive regime would demand.
I turn to support the amendments in the name of the noble Lord, Lord Eatwell. Amendment No. 250E recognises the importance of local broadcasting without listing input requirements. It would effectively ensure that the services remained locally focused without detailing how that objective was to be achieved. The focus would be on content rather than input and it omits the need for a legally enforceable code detailing the locality requirements set out in Clause 307. The amendment would thus ensure that the local character and coverage of a service is maintained through the condition requiring that an appropriate amount of local material is broadcast of which an appropriate amount is locally made. The amendment also ensures that the locality element is maintained, even if the terms of the licence are varied.
Amendment No. 252A complements Amendment No. 250E by defining the phrases "local material" and "locally made". We support this proposal to limit unnecessary control and to encourage industry participation in the regulatory structure.
I also support in principle Amendments Nos. 253 and 255. The importance of the music industry cannot be underestimated. That is why we wish to encourage its continued growth. We do not believe that the correct place to include a reference to music is Clause 307. I raised this issue earlier in Committee when we debated Amendments Nos. 251 and 252 to Clause 306. We want to achieve the appropriate balance. We believe that Clause 306 is the only clause where these issues can be comprehensively addressed.
As my noble friend Lord Dubs indicated, one year ago the draft Bill gave Ofcom a duty to promote and protect the local content and character of local radio. No one quarrels with that. The correct way forward is perhaps to leave it at that and say to Ofcom, "Right, it is up to you how you go about this". I hope that it would consult with the industry and with other people who know something about it and come forward with a code which it would then enforce.
I was shocked to find that there had been no consultation with the industry about Clause 307. It possibly stops short of describing what colour the wallpaper will be at various local radio stations, but not by much. It goes into a ridiculous amount of detail and can have been drafted only by people who know little about local radio. I take one example. What is a local advertisement? Is it an advertisement for a local product or service? If it is not, why would it be on the local radio station? Ultimately, everything is delivered locally, whether it is from Marks and Spencer, Safeway or Jaguar. Products are purchased in a locality and therefore the advertisements are for local products and services.
Is the product locally made? That is not a restriction on the radio station; it is a restriction on the advertiser. If I operate the local garage, is it being said, "Sorry, you cannot go to a London advertising agency. Saatchi and Saatchi may be all right for people down there, but how dare you use them? You must use a local agency". There may not be one in many localities. It is daft.
As the noble Baroness, Lady Buscombe, pointed out, it is not only news that defines a local radio station. If a tune is played as a request for someone's granny in the area, it has a local flavour to it. That is who local radio plays to. It is why independent local radio has successful audiences. It is not because they are more professional than the BBC presenters, as I have said previously—of course they are not—but they are more locally based. They are anchored in their communities.
As regards advertising, one cannot define proportions because it depends on the size of the radio station. I mentioned previously that I am still chairman of Scottish Radio Holdings but no longer have any hands-on executive responsibility. Within that comparatively small group of radio stations, we have a station like Radio Clyde, which with a very large audience is clearly attractive to national advertisers and too expensive for local plumbers. Why would a local plumber advertise on a station with a catchment area as large as ours and waste many of his bullets? By contrast, a station like Borders or South West or Moray Firth in Inverness is not particularly attractive to national advertisers because of their comparatively small populations. But the local plumber might well want to advertise on these because he does not waste money on an audience that cannot use his product.
The idea that one can put forward a one-size-fits-all certain percentage of local advertising frankly does not bear scrutiny by anyone who knows anything about the way local radio or the advertising industry work. I favour the route that operated while I was involved. An application—
I wonder if I may intervene. I am a little surprised that my noble friend Lord Eatwell did not make it clear to my noble friends Lord Dubs and Lord Gordon of Strathblane that we are going to take away these amendments and come back at Report. I made that clear to my noble friend Lord Eatwell, so I think it would be helpful before we go further—
If Clause 307 is being withdrawn, I can sit down very quickly. If Clause 307 is going, I am delighted.
I should like to come back to Clause 306 which is staying and about which I should like to say a word. A bid is put forward to run a licence. If successful, a licence is awarded and it is up to the regulatory body—which in my day was the IBA, then the Radio Authority and now Ofcom—to ensure the licensee sticks to that promise. That promise will include a degree of localness. That is the way forward. I am delighted to hear that Clause 307 is coming out.
I should like to intervene. My name is at the top of the statement that:
"The above-named Lords give notice of their intention to oppose the Question that Clause 307 stand part of the Bill."
I have had no prior notice that that clause was going to be withdrawn. That was why I spoke at length.
I wonder whether I could respond to what has been said. If the noble Lord, Lord Brooke, does want to come in, I will sit down again.
I did not actually say to my noble friend, Lord Gordon of Strathblane, that I would withdraw Clause 307. I want to make it clear that extensive discussions have taken place between the noble Lord, Lord Eatwell, and his representatives and officials of my department. We have conceded that we have not got this right. We do want to come back at Report with amendments which will resolve the problems that noble Lords have pointed out. If the noble Lord, Lord Brooke, still wants to speak, I shall sit down, otherwise I should like to explain the position of the Government.
It would be simplest if I dealt first with Amendments Nos. 250E, 252A, 252B and 254 since they all deal with the means by which the local content and character of local radio should be protected. I will then go on to Amendments Nos. 252C, 253 and 255 which deal with the more detailed but no less important questions of whether the provisions relating to localness need to refer specifically to music, musicians or local talent. The Government have agreed a significant relaxation of the ownership rules for local radio, so that there could be as few as two owners in each area. On a national level, the ownership rules would, by extension, permit the UK radio industry to be dominated by two major groups.
Clearly, we believe that these new ownership rules are right or we would not be proposing them. However, we also recognise that there is a possible risk that greater consolidation could lead to a loss of localness in local radio. We do not say that this will inevitably happen, merely that it could happen. We therefore want to establish a structure that avoids any damaging effects on local radio.
Clause 307 therefore requires Ofcom to draw up guidance on localness. There has, however, been concern in the radio industry that this could lead to the micro-management of the industry, as my noble friend Lord Dubs expressed earlier in this debate and as my noble friend Lord Eatwell expressed at Second Reading. The radio industry has made a number of constructive suggestions to change the Bill which we very much welcome. Those suggestions are given effect to in the amendments before us. We very much welcome those suggestions. As I said just now, my officials have discussed them in some detail with the industry. We are persuaded that we should make changes to the Bill which retain protection for the local character of radio stations while addressing the issue of micro-management. I should like to consider the options and bring back amendments on Report.
I have some sympathy with the thinking behind Amendment No. 254 but I do not think that the amendment is acceptable. We believe—the industry recognises that in its amendments—that there is a case for strengthening Ofcom's responsibilities for securing the broadcast of local material, of which an appropriate amount is locally made. In other words, I believe that the case is already made for taking action now.
However, I would remind noble Lords that this duty of Ofcom's will have to be interpreted by it in the context of its general duties. That will ensure, among other things, that its regulation is proportionate and targeted only at cases in which action is needed. I believe that that, along with the amendments I hope to table on Report, should be sufficient to ensure that Ofcom does not adopt an over-regulatory approach to that duty.
I have much sympathy with the thinking behind Amendments Nos. 252C, 253 and 255. We recognise and value the British music industry and recognise also the importance of the relationship between the radio industry and the music industry. I have already indicated that I should like to consider the amendments tabled to Clauses 306 and 307 with a view to tabling government amendments on Report. I want to ensure that the amendments adequately cover the central notion of "local material, of which an appropriate amount is locally made". However, in doing so I shall take careful account of the points made about the importance of music, particularly in local radio, and shall consider whether that can be better reflected in the wording of the Bill. In doing so, we shall be helped by the imaginative and constructive amendments we have debated tonight.
The Minister has made an important statement and created a new situation. I was to speak purely to Amendments Nos. 253 and 255 on the importance of music to local sound broadcasting. Therefore, I am grateful for the very positive mentions the Minister made about that and her rethinking of the situation.
On a general point, one of the matters which interested me in preparing for this part of the debate was what was said by the Minister in another place, Dr Kim Howells. He stated frankly that the Government's proposal represented,
"an enormous liberalisation so as to allow for the possibility—I hope that it does not come to pass—of two large radio groups dominating the UK market. If we do not take steps to prevent it, that level of concentration could lead to a drift away from localness".—[Official Report, Commons, 25/02/03; col. 163.]
The knowledge we have of what happened in the United States, where legislation led to huge changes in concentration of ownership, leads us to feel that we very much welcome the fundamental reconsideration mentioned by the Minister. I hope that as well as continuing to respond positively on the importance of music in local sound broadcasting, the Government will be able to reassure us on the wider implications of the liberalisation of their ownership policy in terms of retaining a local sound broadcasting industry which really shows local character and identity.
Amendment, by leave, withdrawn.
[Amendments Nos. 251 to 252B not moved.]
Clause 306 agreed to.
Clause 307 [Local content and character of local sound broadcasting services]:
[Amendments No. 252C to 255 not moved.]
Clause 307 agreed to.
Clause 308 agreed to.
Clause 309 [Conditions relating to competition matters]:
[Amendments Nos. 255ZA to 255ZC not moved.]
Clause 309 agreed to.
Clause 310 [Exercise of Broadcasting Act powers for a competition purpose]:
I shall also speak to Amendments Nos. 256, 257, 258ZCA and 258ZE to 258ZH.
The amendments address an extremely important issue relating to the economic regulation of broadcasters, which was extensively debated in Committee in another place. The answers provided by the Government at the time were unsatisfactory, and we have therefore decided to return to the issue to press the Government further.
The Bill gives Ofcom sector-specific competition powers relating to broadcasting, which allow it to include a general fair trading condition in Broadcasting Act licences, and also the ability to exercise concurrent powers under the Competition Act 1998. There are significant concerns, however, over the Bill's provisions which enable Ofcom to undertake economic regulation of broadcasting through broadcasters' licences under the Broadcasting Act in addition to these two groups.
Part 3 gives Ofcom overall power to regulate the broadcasting sector via broadcasting licences issued pursuant to the Broadcasting Acts of 1990 and 1996. This gives Ofcom the power to impose licence conditions on licensees and issue directions pursuant to the fulfilment of Ofcom's duties. However, Part 3 provides no guidance on how or indeed whether Ofcom should undertake the economic regulation of broadcasting, using its Broadcasting Act powers as opposed to its Competition Act powers or its sector-specific competition powers.
The key point here is that clearly not all conceivable matters of economic regulation will be matters of competition. Some will be matters of consumer interest, which have no or little competition element. For example, could Ofcom impose conditions on broadcasting licensees relating to the packaging and pricing of their channels and services, pursuant to its duties to further the interests of consumers in relevant markets, or to secure the availability of a wide range of TV and radio services?
It is important to note that decisions under the Competition Act or for a competition purpose under subsection (4) provide for a full right of appeal to the Competition Appeal Tribunal. However, decisions made pursuant to Ofcom's broadcasting powers exercised other than for a competition purpose would not attract a right of appeal to the Competition Appeals Tribunal.
It should also be noted that even if a decision of Ofcom is partly made for a competition purpose the clause provides that no appeal to the Competition Appeal Tribunal will be forthcoming. An appeal would be possible only if the decision was made by Ofcom where the only or main reason was a competition purpose.
As I said in an earlier debate on Part 2, there is serious concern that this lack of appeal right fails to provide broadcasters with the same rights as, say, telephony providers and providers of other electronic communications networks and services when they find themselves subject to economic regulation by Ofcom. That is the background to the amendment.
The first point on which I should like to seek the Minister's confirmation is whether it is the intention to task Ofcom with undertaking economic regulation of broadcasters outside the realm of competition matters. The answer to this question is important and may well determine whether my amendments are necessary, as they are designed to give a right of appeal to broadcaster licensees in circumstances in which Ofcom exercises such powers through the vehicle of television licensable content service licences.
Relevant to this analysis is the fact that cable operators who are retailers of pay television will escape regulation of their pay TV retail activities, as they may not hold TLCS licences unless they themselves operate channels. In those circumstances, it would seem disproportionate to seek to regulate identical retail activities of satellite broadcasters simply because the satellite broadcaster happens to hold TLCS licences for channels that he operates himself. The Minister's response to that disparity in another place did not address the situation in practice. The fact remains that cable operators will be unregulated and satellite broadcasters regulated in relation to the same activities simply because the models under which each operates differ.
We still have not heard an explanation of the Government's position on whether it is intended that Ofcom should seek to undertake economic regulation through the backdoor or TLCS licences in the way that we have described. The Bill does not expressly preclude that type of regulation. Can the Minister, therefore, provide such an assurance to the Committee today? If so, my amendments to these clauses may be redundant. Broadcasters will have the assurance that they are seeking; that is, they will not face economic regulation through their licences for reasons other than a competition purpose. Therefore, the question of whether they have a proper right of appeal in those circumstances becomes irrelevant.
Given that such assurances may not be forthcoming, I shall explain the reasons for my amendments. As I mentioned in my initial overview, one major concern of broadcasters is that decisions of an economic nature not taken for a competition purpose will not, as currently proposed in the Bill, have a right of appeal to the Competition Appeals Tribunal. To clarify a concern raised in another place, we do not suggest that an appeal to the Competition Appeals Tribunal be available on all decisions of Ofcom under its Broadcasting Act powers. Most decisions will have some economic impact, however small, and we accept that they would attract no more than a right of judicial review.
The key point, however, is that decisions in the nature of the examples that I have given, such as those relating to retail pricing and packaging of television services, would attract a right of appeal to the Competition Appeals Tribunal. I have heard no rational argument as to why that should not be the case in any of the debates.
That is to be contrasted with, for example, price regulation of a mobile telephone operator under Part 2, which attracts full rights of appeal to the Competition Appeals Tribunal. Unless the Government have a compelling reason why, say, potential price regulation of Artsworld, FilmFour or digital radio services must not have a full right of appeal, this is surely the discrepancy that they need to address.
Let me explain how my amendments seek to address the matter. Amendments Nos. 258ZA, 258ZB and 258ZC are the key. As I indicated, Clause 310(4) currently allows any persons affected by a decision by Ofcom to exercise any of its Broadcasting Act powers for a competition purpose to appeal to the Competition Appeals Tribunal. Amendments Nos. 258ZA and 258ZB seek to ensure also that any person affected by a decision by Ofcom to exercise any of its Broadcasting Act powers in the fulfilment of general duties under Section 3 may appeal to the Competition Appeals Tribunal. That would ensure that any form of economic regulation, whether taken for a competition purpose or pursuant to any of Ofcom's general duties under Clause 3, would be subject to appeal to the Competition Appeals Tribunal.
The two amendments on their own would mean that all Ofcom regulation, including content regulation, would become subject to the Competition Appeals Tribunal. That is not my intention with these amendments. Amendment No. 258ZC would amend Clause 310(8) to ensure that the right of appeal to the Competition Appeals Tribunal is disapplied in relation to all Ofcom's content regulation functions. That would be the case unless any such decision were made for a competition purpose as reflected in Amendment No. 258ZCA.
Amendments Nos. 258ZE to 258ZH to Clause 311 are consequential to these amendments and widen the scope of any future Ofcom review of its codes, guidance, directions and, as proposed in Amendment No. 258ZF, conditions. I look forward to the Minister's response to these amendments. They are a rather elegant solution to the problem and appear to resolve concern on both sides of the argument. Clearly, it is a point on which we need reassurance from the Minister.
While we are looking at the provisions regarding rights of appeal, I will, with the leave of the Committee, broaden the discussion to rights of appeal under Part 3 in relation to content. It is a matter on which I gave prior notice to the noble Lord, Lord McIntosh.
It has been drawn to my attention—I know that there is considerable concern beyond your Lordships' House, for example in the CBI—that no right of appeal exists under Part 3 with regard to content. So broadcast consumers affected by Ofcom's decision under Part 3 will have only judicial review as their appeal route. I am suggesting that that is unsatisfactory, primarily because of the limited grounds on which decisions can be reviewed.
Unlike appeals to the Competition Appeals Tribunal under Part 2, which can revisit the merits of the decision, judicial review only looks at the way in which decisions were made. All that is despite the communications White Paper promise of appropriate review procedures within the regulator.
In its fourth report, for 2002–03, the Joint Committee on Human Rights expressed reservations about possible breaches of Article 6 of the ECHR in the procedures set out under Part 3. It also stated that judicial review is unlikely to be an effective remedy because the subjective nature of Ofcom's judgment would make it difficult to assess the quality of the decision.
I should be enormously grateful if the Minister could allay my concerns, and the concerns of those beyond your Lordships' House, by explaining how the Government envisage the appeals process under Part 3 working in practice. For example, does the Minister envisage the establishment of an internal review procedure for dealing with appeals?
I turn briefly to other amendments. Clause 310(1) identifies the powers of Ofcom to which the clause applies. It appears to me that Ofcom's powers listed here should also include its powers to issue codes of practice or guidance to holders of licences. That is reflected in Amendment No. 255A.
Clause 310(2) requires Ofcom,
"Before exercising any of their Broadcasting Act powers for a competition purpose", to,
"consider whether a more appropriate way of proceeding in some or all of the matters in question would be under the Competition Act 1998".
Clause 310(3) requires that,
"If Ofcom decides that a more appropriate way of proceeding would be under the Competition Act 1998, they are not, to the extent of that decision, to exercise their Broadcasting Act powers in relation to that matter".
I believe this to be an unsatisfactory situation, with the Bill failing to require or even encourage Ofcom to use its concurrent competition powers in preference to its sector-specific powers.
Amendments Nos. 256 and 257 seek to introduce a less ambiguous position by requiring Ofcom not to use its Broadcasting Act powers on any matter where that matter is capable of being dealt with under the Competition Act. I am aware that this matter was addressed in Committee in another place. At the time the Minister said that the current formulation acknowledges that regulators of a range of sectors, not only of communications, are best placed to determine whether to use competition law or sector-specific powers. He also said that the parties who considered that Ofcom had taken the wrong route could apply for judicial review. This is clearly not the case. Given that Ofcom has discretion as to which route to follow I cannot imagine a scenario where a party would be able to argue successfully that Ofcom had exceeded its powers by choosing one route or the other.
My new clause, Amendment No. 258ZD, seeks to introduce some additional procedural safeguards into this part of the Bill. I believe that the introduction of and changes to licence conditions and directions should be governed by a set of tests for their introduction and modification similar to the tests for setting or modifying conditions in Clause 44 of Part 2 which apply to electronic communications networks and services. It would be helpful if the Minister could explain why the Government have chosen not to adopt such measures in Part 3 of the Bill. I beg to move.
Perhaps I should apologise to the Committee for intruding on private grief by intervening for the first time on Clause 309 on the sixth day in Committee. However, it falls to me to speak on competition matters in relation to amendments to the Bill.
I support the noble Baroness's requirement of various undertakings. A number of the questions she posed can easily be answered and the undertakings given. However, I find myself in some difficulty over two fundamental questions she asks. I do not see anywhere in Clauses 309, 310 and 311, to which the noble Baroness's amendments relate, any express or implied implication that the clauses give Ofcom the power to impose conditions or regulations that do not relate to competition matters. There is much in what she said about concerns that the Bill will give Ofcom powers to produce regulations that affect economic performance and economic-related issues, but nowhere in the three clauses do I find any express or implied concerns. I am sure that the Minister—who was nodding as I was speaking—could give her the confirmation she requests in regard to that issue.
I part company with the noble Baroness over the question of judicial review. Clause 310(2) is very specific:
"Before exercising any of their Broadcasting Act powers for a competition purpose, OFCOM must consider whether a more appropriate way of proceeding in relation to some or all of the matters in question would be under the Competition Act 1998".
In the event of a dispute over whether those powers have been exercised, I see no better remedy than judicial review. I disagree with the noble Baroness that judicial review on that issue is an inappropriate mechanism. Any other appeal mechanism would be much more prescriptive and restrictive. Judicial review has been developed over the years to deal with the exercise of government powers of this nature and has been rather radically honed in recent years.
I support the issues raised by the noble Baroness, Lady Buscombe, particularly in relation to Amendment No. 258ZCA.
In the Church of England we have spent considerable time recently looking very carefully into these matters. I support fully the view that the rights of appeal from decisions of Ofcom need to be extended to licensing and content matters covered in Part 3 of the Bill.
I know that Ofcom will continue the existing roles of bodies such as the Broadcasting Standards Commission, but it would greatly increase Ofcom's transparency and accountability if its decisions could be scrutinised in the manner that we on these Benches are currently exploring.
I have heard the points made from the Liberal Democrat Benches and I shall be interested to explore them further. Certainly in terms of the advice that we have been receiving in the Church of England it would seem that leaving judicial review as the only route available for redress is neither adequate nor appropriate. I may return to the issue at a later stage.
I have only recently heard about this possibility. I, too, am intrigued to know whether there is a likelihood of appeals, particularly on content matters. It has worried me from the beginning that Ofcom or the content board, or a combination of the two, would not be sufficiently independent—and transparently so—in cases brought against them, particularly on fairness and privacy issues. If there was a hope of a process other than judicial review—which, as we have heard, is fairly limited in what it can do for a complainant—it would relieve the minds of many people. I was particularly struck by the range of appeals and appeals upon appeals available in respect of the Bill's technical and economic provisions, which contrasts with the lack of appeal available against any of Ofcom's decisions. It will be interesting to hear more about that from the Minister. I gather that there is legal backing for the amendment and even if it is not possible, such a provision should be written into the Bill.
The noble Baronesses, Lady Buscombe and Lady Howe, and the right reverend Prelate asked about the right of appeal. Which is the right route of appeal on the decisions that Ofcom will make? In Part 3, Ofcom is asked to make subjective content judgments, with safeguards. Ofcom is required to give broadcasters a reasonable opportunity to make representations before imposing sanctions. In the event that a dissatisfied broadcaster alleges that it has been unfairly treated, it may bring judicial review proceedings against Ofcom. The noble Lord, Lord Razzall, emphasised that that is exactly the right approach. The subjective judgment on content is made by the specialist regulator under the supervision of the High Court.
The approach in Part 2 is different because there are no content judgments to be made there. Where Ofcom uses its Broadcasting Act powers for competition purpose, there is of course a right of appeal to the Competition Appeals Tribunal.
I am inclined to follow the noble Lord, Lord Razzall. We have substantial experience of the process in terms of competition policy, and there is reasonable satisfaction with it.
We are talking not about competition but about aggrieved licence applicants and content questions—as opposed to competition matters—where judicial review would be seriously inappropriate.
With decisions involving subjective judgment, I agree with the noble Lord, Lord Razzall, that the matter should be resolved in the High Court under judicial review. Where Ofcom is involved in other types of judgment, there is the right of appeal to the Competition Appeals Tribunal, which seems an entirely justified strategy for dealing with such issues.
The noble Baroness, Lady Buscombe, suggested that there was some unfairness in the proposals in terms of the relative positions of satellite and cable. As retailers of channels, neither is licensed. Therefore, cable packages do not require a licence under Part 3 of the Bill, but neither does Sky as a package of satellite channels. Since Sky operates a vertically integrated platform in which it both packages channels and owns Broadcasting Act licences to provide content for its own channels, it considers that it is singled out from cable operators. However, if a cable operator were to own its own channel, it would be treated in precisely the same way as any other licence holder. So it is not the case that there is unfair discrimination to one provider against another.
The noble Baroness raised the issue of economic regulation. I will come to the detailed comments which she made about her amendments. Ofcom does not have a duty to regulate the economics of broadcasting per se. Ofcom has two objectives for regulating broadcasting economics; namely, competition and consumer interests. Intervention, such as economic regulation in pricing and in the packaging of channels made in the interests of consumers, should be treated in the same way in terms of route of appeal as a competition intervention.
For example, Ofcom may wish to intervene in Sky's packaging of channels so that consumers could have more choice of packages without having to buy a lot of unwanted channels as a minimum. I recognise what the noble Baroness is saying that such an intervention would have a significant economic impact on Sky. But the purpose of the intervention would be a subjective question of what represented an acceptable amount of consumer choice.
Ofcom's duty to further the interests of consumers is qualified by the parameter, where appropriate, of promoting competition. It is therefore difficult to see that Ofcom could justify intervening in the packaging of channels in the consumer interest without being able to show that it was not appropriate, via the extended general and sectoral competition powers that Ofcom will have, to resolve the issue by encouraging more competition in the pay TV market. If Sky thought that Ofcom had not properly evaluated these options it could challenge Ofcom under judicial review that it had not used its powers properly.
I turn to the amendments. I am seeking to obtain from the noble Baroness withdrawal of most of the amendments although I have some good news as regards one amendment. Amendment No. 256 is similar to one which first appeared in another place. It would limit Ofcom's ability to determine the most appropriate route for intervening in a competition matter. The amendment would replace the requirement on Ofcom in Clause 310(2) to choose the,
"more appropriate way of proceeding", which is the choice between the Competition Act powers and the Broadcasting Act competition powers, with a prohibition on the use of Broadcasting Act competition powers where a matter was "capable" of being dealt with under the Competition Act.
We believe that the "more appropriate" test is in line with the treatment of other regulators with concurrent powers in relation to competition issues. Therefore, we would defend that position as enshrined in the Bill.
This formulation acknowledges that the regulators in a range of sectors, not just communications, are best placed to determine whether to use general competition law or sector-specific competition powers in a given case. We regard that as the entirely correct approach.
Conduct amounting to a breach of a competition rule made under the Broadcasting Act may also constitute a breach of the prohibitions in the Competition Act. However, depending on the circumstances, it may be more appropriate for Ofcom to act under the Broadcasting Act powers. Amendment No. 256 would hinder Ofcom's ability to make that decision.
I think that the noble Baroness would regard Amendment No. 257 as consequential and linked to Amendment No. 256. Therefore, if I am able to persuade her to withdraw Amendment No. 256, I foresee little difficulty with regard to Amendment No. 257.
Amendment No. 255A seeks to broaden the range of powers that Ofcom cannot exercise if its Competition Act powers are more appropriate, and provides for an appeal to the Competition Appeal Tribunal against the exercise of those powers. As I indicated earlier, we do not agree with this approach. It is unnecessary because sufficient safeguards are provided by Clause 310, as drafted. In particular, subsection (1)(d) ensures that Ofcom has to consider whether it would be more appropriate to proceed under the Competition Act before it decides to enforce an obligation imposed by licence conditions. That would include any obligation arising out of a code of practice or guidance issued by Ofcom to amplify those licence conditions.
Amendments Nos. 258ZA, 258ZB and 258ZC seek to give a route of appeal to the Competition Appeal Tribunal to a wider range of interventions by Ofcom. As I indicated in my more general comments before coming to the specific amendments, we do not think that would be appropriate. The Bill, taken with what will remain of existing legislation, gives Ofcom a wide range of specific functions for the regulation of broadcasting. We do not envisage it relying on general duties in Clause 3 to a substantial extent: it will use the specific powers that we have created.
Where, however, Ofcom decides that it cannot otherwise adequately perform its general duties, it might decide to impose a licence condition that is not otherwise specifically provided for. Where it does so, that intervention will be made in pursuance of a much broader range of public policy reasons than competition alone—involving, for example, furthering the interests of consumers.
We have listened to the concerns about the exercise of Ofcom's Broadcasting Act competition powers and, in particular, that Clause 3 could be used as the basis of conditions amounting to what it terms "economic regulation", without a route of appeal to the CAT. I have sought to make clear the differentiation between the two roles of Ofcom in that respect.
Amendment No. 258ZCA appears to recognise that, in theory, Ofcom could use non-competition powers under Part 3 of the Bill—that is, Clauses 259 to 308 and Clauses 312 to 339—to intervene for a competition purpose. This rightly recognises that such an intervention should have a route of appeal to the Competition Appeals Tribunal if it was proved that the intervention was for a competition purpose. We entirely agree with this principle which, once again, I sought to emphasise earlier, and have already allowed for this in the Bill.
Amendment No. 285ZD seeks to ensure that Ofcom carries out its functions according to best regulatory practice. We do not disagree with the principle behind this. Indeed, that is the requirement of Articles 6 and 7 of the framework directive; namely, that Ofcom should adopt appropriate, fair and transparent processes for applying its powers. However, we believe that the Bill contains sufficient provisions to ensure that that is delivered. Although such a provision is made in Part 2 as a requirement of implementing the directive, there is no need to repeat the principles here. To do so would require the numerous repetitions of this text throughout Part 3.
We consider that Amendments Nos. 258ZE, 285ZF and 258ZH are unnecessary as we have ensured that provision for Ofcom to review its codes and consult on those reviews is already made in the relevant sections of the legislation. We would maintain that these amendments would therefore create much duplication. I do not see what they would add to the Bill.
Amendment No. 258ZF would require Ofcom to review every licence condition imposed on licensed broadcasters and to consult on that review. That is unnecessary since Ofcom is already under a duty under Clause 6 to review all its functions and remove those burdens that are no longer necessary.
Finally, I come to Amendment No. 258. This amendment seeks to ensure that Ofcom carries out its functions according to best regulatory practice by requiring it to inform any person affected that it has used its Broadcasting Act powers for a competition purpose. Under this amendment such a notification would include informing those affected that they may appeal to the Competition Appeal Tribunal against the intervention.
We do not disagree with what we take to be the core principle behind this amendment—transparency and fairness of the regulatory process—and we therefore agree to consider further the possibility of tabling a suitable amendment at Report stage. I hope that the noble Baroness will feel able to withdraw that amendment on the basis that we shall act positively in future and that she will not press the other amendments in the light of the response that I have given.
I thank the Minister for his response. I am smiling to myself because I believe that we are about to discuss amendments which concern the concept of unsuitable versus suitable. I am disappointed that the Minister says that the Government accept the principle behind Amendment No. 258 but clearly it is unsuitable in its current form. However, I am grateful that the Minister assured me that the Government will table a suitable amendment at Report stage that we shall, I hope, be able to support.
I shall not detain the Committee at this late hour. I am clearly disappointed in relation to the Minister's response with regard to Part 3. As I say that, I look firmly towards the right reverend Prelate the Bishop of Manchester and the noble Baroness, Lady Howe. I thank them for their support for what I considered was a reasonable suggestion; namely, that, as stated in the White Paper, an appropriate review procedure within the regulator would look after the interests of those aggrieved by the provisions of Part 3. I urge the Government—I cannot put that strongly enough—to take that point away and reconsider what Members of the Committee including myself have said on that matter.
I depart most strongly from what the noble Lord, Lord Razzall, said with regard to judicial review in that instance. There are instances where judicial review is entirely appropriate but I believe that in the instance we are discussing it is not appropriate.
I thank the Minister for his extensive reply. There are a number of issues that I shall want to read with care in Hansard. I hope that the Government will bring forward an amendment that we can support. I am pleased that there are a number of principles in relation to other amendments where the Minister feels that there is some consensus. On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 256 to 258ZCC not moved.]
Clause 310 agreed to.
[Amendment No. 258ZD not moved.]
Clause 311 [Review of powers exercised for competition purposes]:
[Amendments Nos. 258ZE to 258ZH not moved.]
Clause 311 agreed to.
Clause 312 [OFCOM's standards code]:
[Amendment No. 258A not moved.]
I rise with some hesitation to speak to this amendment in the presence of the current chairman of the Advertising Standards Authority and in the presence of a former distinguished chairman of the same body.
Clause 312 gives objectives for Ofcom to set in its codes for programmes and advertising. My amendment seeks to replace the word "unsuitable", which appears to be a lovely portmanteau word which has been very popular today, with the terms "misleading, harmful or offensive". The merit that I claim for the words in my amendment is that they have the advantage of being concepts that already form the basis of the current ITC and Radio Authority codes of advertising standards and practice. Continuity and clarity will be very important.
Advertising is fairly well regulated in this country. It is done by a system of pre-clearance in broadcasting, because clearly advertisers do not want to go to the sometimes considerable expense of making an advert only to find that the basic concept will fall foul of the regulator. In television, we have the Broadcasting Advertising Clearance Centre, and in radio, we have the Radio Advertising Clearance Centre. Advertisers can come forward with an idea, clear it informally with the regulator, and go ahead and make the advert. In the case of television, that can be very expensive. In the case of radio, a commercial can be considerably less expensive.
Clearly it is very important that people know what they are taking about. "Misleading, harmful or offensive" are words that they have grown up with over the past 20 years. "Unsuitable" is a portmanteau word that is much wider than that, and will make for a lack of clarity, legal actions right, left and centre, and uncertainty. It is a bad idea, and we would be much better including the words in the amendment. I repeat that, if they were in the Bill, they would give Ofcom exactly the same powers as the ITC has at the moment. I beg to move.
I added my name to the amendment because I strongly feel that when Ofcom, under its duties in the Bill, is setting out standards and objectives under Clause 312, those objectives need to be more precisely stated in relation to advertising than the prevention of "unsuitable" advertising under subsection (2)(g).
At the end of the Second Reading debate on the Bill on 25th March, when the problems had been raised by one or two speakers, the noble Lord, Lord McIntosh of Haringey, said that "unsuitable" simply meant that advertising could be unsuitable for certain times or certain audiences, and was similar to the Independent Television Commission's current powers. However, "unsuitable" is capable of very wide interpretation and, if I may suggest it, misinterpretation. "Misleading, harmful or offensive" are more appropriate and precise words. Indeed, as my noble friend Lord Gordon of Strathblane said, they are concepts that are already in the ITC and Radio Authority codes.
I have a special interest as chairman of the Advertising Standards Authority, which is the self-regulatory body responsible for non-broadcast advertising. The code of advertising practice that we operate, like the codes of the Independent Television Commission and the Radio Authority, has precise criteria that give the much greater certainty appropriate for a creative business such as advertising than that of "unsuitable".
Furthermore, I should be most concerned if the broadcasting codes incorporated such a catch-all word. Surely we all understand that many advertising campaigns are increasingly run across several different platforms simultaneously. There would be extreme incoherence between broadcast and non-broadcast codes if "unsuitable" were used instead of something more precise, as the excellent amendment suggests.
I strongly support the amendment. I endorse the fact that "unsuitable" is very seriously unsuitable as a tool of advertising regulation. As the noble Lord, Lord Gordon, was kind enough to say, I speak from the experience of twice being an advertising regulator, once with the Advertising Standards Authority and once with the IBA. Although the backgrounds were a little different, the job of regulation of advertising was very much the same. I learnt in both roles that self-regulation was a great deal better than statutory regulation, provided that certain conditions can be fulfilled. Those are not necessarily always easy conditions. They were admirably set out by the noble Lord, Lord Currie, the chairman of Ofcom, in a speech to the Advertising Association's annual lunch. One critical condition for any self-regulatory system is that a sanction as fair and effective as possible should be attached to the regulation. In the old days, the ASA and the IBA had that. For that, as the noble Lord, Lord Borrie, has said, one needs clear, credible and precise language. The words "misleading", "harmful" and "offensive" are part of the dictionary of advertising regulation and are well held and well understood by those who have to operate them. They have a long history of use. "Unsuitable" is a very vague and inappropriate term to apply to advertising. It is not a good regulatory tool and it is so imprecise that is certainly susceptible to an immense amount of misinterpretation, leading to a great deal of confusion among the various interest groups concerned.
As deputy chairman of the ITC, I would like to add my support to the amendment. As regulators, we agree that "unsuitable" is too vague and broad. We understand that the industry far prefers the wording before us. It is clear, unambiguous, effective and easy to administer, so I hope that the Government will accept the amendment.
I rise briefly to support the amendment. "Unsuitable" is a very vague word. "Misleading, harmful or offensive" can be interpreted in a number of different ways, but they are a little sharper than the vague "unsuitable". "Misleading" is fairly clear. The timing of the broadcast and its audience are the criteria we took into account when I was at the Broadcasting Standards Commission and when we were considering any of the adverts which caused complaints—and there were quite a number of them. If they appeared during children's programmes and might have been perfectly acceptable for a slightly older audience, that was regarded as unacceptable. I am sure that the amendment is an improvement and I willingly support it.
I rise more briefly than I had proposed to speak to the amendment but only because it has been so eloquently spoken to and supported by a number of noble Lords. My name and that of my noble friend Lord Saatchi have been added to it. We feel very strongly about the amendment. At the risk of some repetition, it may appear a small and inconsequential amendment, but it is regarded by the advertising industry as extremely important. It is surely significant that broadcasters and staff at the existing advertising regulators, the ITC and Radio Authority, also support the amendment.
The Government have not so far supported it. While the issue was briefly debated in Committee in another place and again at Second Reading in your Lordships' House, the reasons given for opposing the amendment have been questioned by the advertising industry again and again. I know that it has remained in touch with the Department for Culture, Media and Sport to try and make a difference. The argument that "unsuitable" is needed to give Ofcom the same wide-ranging powers that the ITC had under the 1990 Act is highly spurious. A comparison of the 1990 Act and the 2003 Bill demonstrates that Sections 8 and 9 of the 1990 Act are already separately and individually replicated in various clauses of the Bill—I refer to Clauses 312, 314 and 315. In other words, with or without the word "unsuitable", the Bill already gives Ofcom exactly the same powers as the ITC was given by the 1990 Act.
The advertising industry believes that this is an important issue; the word "unsuitable" goes much further than existing regulatory powers. It is vague and inappropriate wording to apply to advertising and is not a good regulatory tool. The fact that it is so sweeping and imprecise a word means that it is capable of misinterpretation by interest groups in future. In contrast, as noble Lords have already said, "misleading, harmful or offensive" have the advantage of being concepts that already form the basis of the current ITC and radio authority codes.
I have an interest in this regard. It is a very outdated interest but I was involved in the advertising industry back in the 1980s. The words "misleading, harmful and offensive" were well known and understood by everyone then, so why change it? It "ain't broke", so why try and fix it? I have been waiting a long time to declare a vested interest, albeit an outdated one, to join so many other noble Lords who have already done so. We urge the Government to support the amendment. It is important to the industry. If we do not receive a satisfactory reply this evening, we will return to the issue on Report, divide on it and win.
The noble Baroness, Lady Buscombe, was somewhat dismissive of the response of the Minister in another place when he defended the position in the Bill because the drafting was designed to maintain the current wide scope of protection provided by the Broadcasting Act 1990, which, I stress to the Committee, contains no qualification limiting the scope of the code governing standards and practice in advertising.
I listened carefully to all contributions to this short debate, not least because it was moved so forcefully by my noble friend. No one made any comment on the nature of broadcasting and the concept of the watershed. The noble Lord, Lord Borrie, indicated that such advertising campaigns go across a range of media. Broadcasting has a specific consideration to take into account: a particular target audience and a particular time of the day at which audiences are influenced and open to—
I do not like to interrupt the noble Lord but the phrase in Clause 312(2)(g) is very broad. It refers to,
"the inclusion of unsuitable advertising in television and radio services".
Surely that means not just matters relating to timing and audience but the words and images presented by the advertising.
Of course the phrase is broad. It must be broad so that control of broadcasting can take account of different times of the day and different audiences who are being approached by the advertisers.
I apologise for interrupting again so quickly. Is the Minister suggesting that the present legislation, which does not contain the word "unsuitable" but merely goes for the words for which I am seeking, is somehow deficient? How have we got by for the past 20 years?
I am arguing that we need some breadth to the position. Limitations are being identified and words and concepts that give some precision are being specified. I recognise the value of precision. I stress that the problem with regard to the Bill is that it deals with the media. For example, the concept "harmful" might apply quite strongly at certain times of the day with a very young audience but have no application at all at 11.30 p.m. when only adults are watching.
So what the Minister said in another place, and what we are defending in the Bill at the present time, is that there is a proper reason for retaining the concept of "unsuitable". It gives a breadth, which I recognise that my noble friends object to, which improves the position. That is against the background that the codes will be established on the basis of the fullest consultation with those affected in the industry. No one is suggesting that the concepts will be handed down as the laws of the Medes and the Persians. In fact they will be working codes on the basis of consultation. I am merely indicating that the underlying concept that we work into the Bill should have some breadth to it. That is why the phrase "unsuitable" is used. It is broader than the concepts that my noble friend seeks to introduce with his amendment.
I thank the Minister for giving way. I want to question what he said. In my reply I clearly indicated the differing times of the day when advertisements would be shown—I meant, without spelling it out, the watershed. The words "harmful or offensive" are clearer than "unsuitable". They are more specific, and even though both of them are interpreted in the eye of the beholder, it is the circumstances in which they are interpreted, I would have thought, that is what matters, with the greatest respect. "Unsuitable" is pretty vague.
The noble Baroness has merely emphasised the nub of the discussion. I object to my noble friend's amendment, which introduces wording that is more specific in terms of how the codes would operate. I am seeking greater breadth, because I believe that broadcasting has different obligations from other advertising media. We have had breadth with regard to the way in which broadcasting has been controlled since the 1990 Act, when the three concepts were built into the Act. We are merely sustaining the position that we ought to have that breadth as the basis for the codes that will control advertising for broadcasting, because of the different nature of broadcasting and the different audiences at which it is targeted at different times of the day. That is the basis of the Government's contention.
I hear that I am far from persuading both my noble friends and other contributors to this debate. However, let me make the obvious point—it is not for me to judge what should or should not be allowed, but it is right that the advertising codes are developed like the general standards code to reflect public attitudes as to what is acceptable in the specific medium of broadcasting. The Bill is concerned with the broadcasting media and it is a specific aspect that we need to deal with. So I hear what my noble friend has said, but I ask him to reflect on the issues. We are at Committee stage. I recognise that there are later stages of the Bill, but we regard the position adopted by my honourable friend in another place, which I am seeking to sustain today, as the best means of providing the necessary protection for broadcasting, which is different from advertising in other media.
I thank the Minister for his reply. At the lateness of the hour I am in danger of becoming short-tempered. I am extremely disappointed that on yet another matter on which every single speaker representing a wide range of interests, and every possible body that Ofcom would consult with, expresses one view. The Government opt obdurately for another and cling to a rather poor defence put up by the Minister in another place.
However, it would be wrong to press the amendment at this stage and I shall not do so. We are taking a long time in Committee and we shall take even longer on Report if we are to have Divisions on amendment after amendment which the Government have refused to accept at this stage. I beg leave to withdraw the amendment.
moved Amendment No. 260:
Page 276, line 2, at end insert—
"( ) Before drawing up or revising the codes, OFCOM shall have regard to the extent to which matters they are required to secure under this section are, or may be, secured by effective self-regulation; and, in the light of that, to consider to what extent it would be appropriate not to draw up, modify or withdraw a code under this section.
( ) In determining for the purposes of this section whether procedures for self-regulation are effective, OFCOM may take account not only of self-regulation independent of those to whom it applies, but also of the extent to which the matters to be secured under this section are being, and are likely to be, secured without the further imposition of a code."
In moving Amendment No. 260, I shall speak also to Amendment No. 261.
Subsection (3) of Clause 312 requires that:
"The standards set by OFCOM under this section must be contained in one or more codes".
The purpose of the amendment is to make it clear that as regards its codes Ofcom has the option of, first, drawing up or revising its own codes; secondly, contracting them out to an effective self-regulatory system, as Ofcom may do with any of its functions under Clauses 1(7) and 6(2); or, thirdly, reviewing the possibility of removing or reducing regulatory burdens under Clause 6(1) where they are no longer necessary.
Both contracting out and the explicit duty to review and reduce regulatory burdens where possible are an important change of regulatory approach and it would be helpful to make both principles explicit in relation to Clause 312.
A similar amendment was proposed by my honourable friend Andrew Lansley during the Commons Committee stage. In the discussions in Grand Committee E on 28th January (at col. 785 of the Official Report), he said that it was important to clarify not only that Ofcom could contract out codes for self-regulation, but to require that Ofcom keep the scope of its codes under consideration. The Minister in his response was not entirely clear that the ownership of codes could be contracted out to self-regulatory bodies, but unless this is achieved—with Ofcom retaining backstop powers—there is little meaning to the "self" in "self-regulation".
By way of example, as has already been mentioned in previous debates, an Advertising Association task force representing broadcasters and the advertising business has recently put forward a proposal to Ofcom to contract out broadcasting advertising to a self-regulatory system, using the tried and tested model of the Advertising Standards Authority.
One of the objectives of the advertising industry in so doing is to address the challenges of media convergence which will increasingly reduce the rationale for entirely separate systems of advertising regulation—self-regulation for non-broadcast advertising and statutory regulation for broadcast advertising. Another objective is to provide consumers with a one-stop shop for complaints about advertising across all media.
Part of the proposal is that Ofcom should contract out to an agreed self-regulatory system the ownership of the broadcast advertising codes. Again, this is modelled on the much-respected ASA/CAP system for non-broadcast advertising in which CAP—the industry Committee of Advertising Practice—owns, administers and enforces the codes. Unlike the current self-regulatory system for non-broadcast advertising, the proposal envisages that Ofcom would have to approve any code changes as it is recognised that, in accordance with the Bill, a co-regulatory relationship with Ofcom would exist.
This amendment would make it clear that codes could be contracted out. The second part of the amendment reinforces the principle of Clause 6(1) which requires Ofcom to review regulatory burdens and lift them where appropriate.
Clause 317 sets out Ofcom's duties in relation to the publication of, and consultation on, draft codes. Amendment No. 261 replaces "after publishing" the draft code in line 14, subsection (3) with "in the preparation of any" code, Ofcom must consult. The purpose of the amendment is not, as the Minister, Dr Kim Howells, in another place assumed during Commons Committee stage on 28th January, to place difficulties in the way of Ofcom acting expeditiously to undertake its regulatory functions, but instead to reflect recent regulatory working practices and to ensure maximum transparency.
We do not think this places a statutory obligation on Ofcom to go through two stages of consultation before setting standards, as suggested by the Minister, Dr Kim Howells. It just creates maximum flexibility, allowing Ofcom to take soundings as it develops its thinking.
There is some concern in the advertising industry that the current wording of subsection (3)—
"after publishing the draft code"— could reverse the transparency that has been introduced in recent years; for example, at the ITC. Previously the advertising business found that, unlike broadcast licensees, it was rarely alerted to the likelihood of a code being changed until the draft code was published. By then it was difficult to change views, which meant that advertisers were no more than passive spectators, a position they found unreasonable since without their funding commercial broadcasting would not exist.
It is important to ensure that Ofcom works transparently in relation to the advertising industry as well as its licensees by involving this sector in formal and informal discussions about codes at all stages, rather than only giving this sector the opportunity to comment at the formal consultation stage when views are already set out on the overall direction to be taken. The purpose of this amendment is therefore to establish that the advertising sector would be party, like licensees, to the ongoing discussions which regulators have as a matter of course with the various parts of the industry and with consumer groups. I beg to move.
The Government want standards to be maintained in television and radio that ensure citizens are protected from harm. The Bill secures this protection by ensuring that Ofcom is properly charged with maintaining standards. This is among its general duties in Clause 3. Then there are specific responsibilities in the Bill, notably at Clause 312, which provide for Ofcom to ensure that there are codes for content standards. These are underpinned by high-level principles in the Bill and backed by sanctions.
We consider that Amendment No. 260 is unnecessary in encouraging Ofcom to operate through self-regulatory systems where those will effectively deliver the protections required. Ofcom is already encouraged to do that by way of Clause 6. The amendment also seems aimed at allowing regulation without any code. Whether Ofcom itself draws up a code, or, for example, endorses an industry code which achieves the required result, I find it hard to imagine an effective system that does not have a code of some kind telling broadcasters what they can or cannot do. Codes are a fundamental part of the regulatory structure for broadcasting and are almost infinitely malleable. They can be very detailed or very high level. But a code of some kind, backed up by sanctions, is an effective means to securing transparent regulation.
I am disappointed by the comments of the noble Baroness, Lady Buscombe, on Amendment No. 261. This issue was addressed in another place and we had thought that the Opposition seemed to be reasonably satisfied with our response. The Government maintain that Ofcom is required to consult on its draft code. It is not precluded from taking soundings prior to drafting the code and I expect it would want to do so. A change in that code may be proposed as a result of it becoming apparent from a number of sources over a number of years that a change might be needed. That can all continue to happen.
However, the formal consultation is best undertaken on a draft code. Many consultees would find it difficult to form a view in the abstract and a draft code is the best way of stimulating debate, both on the principles and on the detail of their proposed implementation. A statutory requirement for a two-stage process of consultation would work directly contrary to the aims of efficient and effective regulation which we are aiming for.
As I indicated, we hoped that we had succeeded in making this case in the other place. I hope that on mature consideration the noble Baroness may feel that she can accept the case on this occasion and is prepared to withdraw this amendment.
moved Amendments Nos. 260A and 260B:
Page 278, line 44, leave out from beginning to "the" in line 46 and insert—
"(7) Provision included by virtue of this section in standards set under section 312 is not to apply to, or to be construed as prohibiting" Page 279, line 1, leave out from "political" to "paragraph" in line 5 and insert "or referendum campaign broadcast the inclusion of which is required by a condition imposed under section 326 or by"
On Question, amendments agreed to.
Clause 314, as amended, agreed to.
Clauses 315 and 316 agreed to.
Clause 317 [Setting and publication of standards]:
[Amendment No. 261 not moved.]
Clause 317 agreed to.
Clauses 318 to 325 agreed to.
Clause 326 [Party political broadcasts]:
moved Amendment No. 262:
Page 287, line 20, at end insert—
"(1A) The regulatory regime for every television licensable content service licence and every radio licensable content service licence shall include—
(a) conditions requiring the inclusion in that service of party political broadcasts and of referendum campaign broadcasts, if so prescribed under this section; and
(b) conditions requiring that licence holder to observe such rules with respect to party political broadcasts and referendum campaign broadcasts as may be made by OFCOM."
To detain the Committee at this hour of the morning, it has to be good. This is an important matter and I am grateful to those noble Lords who put their names to this clutch of amendments referring to party political broadcasts.
It is barely an exaggeration to say that a sword of Damocles hangs over us in this matter, not only on the Bill but about something even more important; that is, the integrity of our political system. I believe that most noble Lords would agree that one of the great advantages of our system over some others, in particular the American system, is the fact that it does not allow paid advertising by political parties. That is the crucial fact that makes our politics affordable, stops us becoming not a democracy so much as a plutocracy, and keeps corruption at bay. In the United States of America there would be nothing more popular than that among everyone except politicians and those who fund them.
The problem that we have is signalled on the front of the Bill where my noble friend Lady Blackstone has had to state,
"I am unable (but only because of clause 314) to make a statement that, in my view, the provisions of the Communications Bill are compatible with the Convention rights".
The fear is that because we do not permit political advertising, that will be seen under the European Convention to be a breach. The case I make is set out in considerable detail and very well by the Electoral Commission in its publication entitled Party Political Broadcasting (the Electoral Commission 2003). The core of the argument is that our best defence for the human rights court is that we have a perfectly good, robust, established system of party political broadcasts which enables substantial minorities to have their say and therefore does not require paid advertising.
I have been connected with the system of party political broadcasting for some time. The noble Lord, Lord McNally, looks at me. He and I were responsible for some of the Labour Party's greatest party politicals. In those days Ministers often spoke straight to camera but things have moved on.
The point here is that this is a very ramshackle system. There is not a proper process. There is no real way to determine who gets what. At the end of the day, the broadcasters decide and you either grumble or take them to court. There is inadequate consultation. It is a mess. That will no longer do if we are trying to set this up as a system that is a defence in front of the European Court. I do not want to go seriatim through the amendments, which speak for themselves. Broadly speaking, we want to have Ofcom set up a system for party politicals under an independent chair which can bring order to this chaos. We want to extend its remit in this regard only to the BBC and S4C. We want to encapsulate in legislation, rather than as something that is just done by ad hoc negotiation, the entitlement of parties to party political broadcasts based on objective criteria. And we want Ofcom to be able to extend PPBs to other broadcasters if in time they become more important.
Those are the amendments in a nutshell. I very much hope that Ministers will have something positive to say about them, sooner rather than later. There is a case that they have come in rather late in the Bill's progress, and perhaps it will take rather longer before the Government are ready to legislate them into effect. But we need words of comfort; otherwise, we shall leave the Bill only with the very uncomfortable words of my noble friend, Lady Blackstone, on the front page of the Bill and with nothing to assure us that the threat which I perceive, and which the Electoral Commission in its wisdom takes very seriously, will not materialise.
The amendments largely reflect the recommendations of the Electoral Commission's report published in January 2003. As the Bill stands, as the noble Lord said, the ban on political advertising is maintained, reflecting the provisions of the Broadcasting Act 1990, a policy which we support.
The reasoning behind the ban is simple. If the prohibition was removed and political parties were permitted to pay for advertising through the broadcast media, only the wealthiest candidates with access to financial resources would be able to advertise frequently. Other smaller or less affluent parties would fail to secure the necessary media coverage to participate fully in the democratic process. This is contrary to the interests of the electorate; success would be judged on pecuniary advantage alone. Furthermore, it would be impossible to maintain a balance between each political party and the level of media coverage it enjoyed individually.
I believe that the amendments are pretty much identical to those tabled by my honourable friend the Member for South Cambridgeshire, Andrew Lansley, in another place. I am pleased that the noble Lord has put them down for us to debate in the Committee.
We are perhaps fortunate that the amendment is coming up at this time of night. I can imagine that if it had come up early in the day, with the Chamber full and everybody feeling fresh and bushy-tailed, we could have had a good couple of hours on party political broadcasts.
As the noble Lord, Lord Lipsey, said, some of us go back a long time on this matter. I still wake up in cold sweats having been a young, junior official accompanying George Brown to the BBC's studios to be told that we had only two takes to get the broadcasts right and trying to convince George that he had to stick to the script.
The noble Lord is quite right. When we consider the time and energy we have in recent times put into legislation to try to put a cap on party political spending, we can see that to allow this backdoor blast below the waterline would be very dangerous. We have only to look at the United States to see the dangers. I do not want to go any further than the noble Lord and the noble Baroness, Lady Buscombe, but, to borrow a phrase, it is a real and present danger to our democracy if we are left unprotected in this matter.
The party politicals may not be the most loved of television broadcasts, but they are infinitely preferable to bought advertising by politicians and political organisations. I hope that the Minister will be able to give us some words of comfort.
The Government propose to resist the amendments, not because we necessarily object to all of them, but because we intend to consult on our response to the Electoral Commission recommendations and to bring forward proposals that take account of its report. Members of the Committee will be aware of the commission's report Voting for Change, which brings together recommendations from a number of its reviews, including that on party political broadcasts. The Government will seek views on PPBs shortly so that we are in a position to introduce any necessary legislation as soon as parliamentary time allows in conjunction with other changes in electoral law.
I am aware that deliberation about the future arrangements of PPBs has already been extensive. The commission published a wide-ranging discussion paper in December 2001. A consultation paper was published in June 2002 and the commission's final report in January 2003. By then, the extensive consultation on the Communications Bill had been completed and it was already in Committee in the House of Commons. We do not believe it right to accept the principles and to seek to implement them without putting forward the Government's own proposals for comment and proper scrutiny.
The amendments would give Ofcom much discretion on the allocation of PPBs as well as establishing certain criteria for that allocation. That may or may not be the right way forward, but it is right that stakeholders and Parliament are given an opportunity to consider the issues more fully before we give Ofcom such powers.
Notably, some of the commission's recommendations refer to the need to ensure that the PPB arrangements provided for in the Communications Bill comply with the Human Rights Act and the European Convention. The Government do not share the commission's view about the supposed deficiencies of the Bill. If we did, that would have been evident from the statement that I laid before the House under Section 19 of the Human Rights Act. So those changes may be unnecessary.
On the other hand, the Government fully support the commission's intention to involve a much wider audience with the democratic process. It suggests that one way of doing that is to extend the PPB obligations to all broadcasters. That is a programme on which we will welcome views and supportive evidence, with some assessment of the costs and benefits to political parties, broadcasters and the public. It may be a proposal that we will want to take forward, but we need to assess the evidence on the implications. There is no immediate urgency, as my noble friend Lord Lipsey implied, given that the terrestrial channels that already have PPB obligations retain nearly 80 per cent of the audience share. As the Electoral Commission states, it is better to get it right than to fail through haste.
The Government will seek views so that we are in a position to introduce any necessary legislation as soon as parliamentary time allows, along with other changes to electoral law. In the light of that, I hope that my noble friend will feel able to withdraw his amendment.
I thank the Minister for that reply. The consultation process for PPBs is chaotic. It would be foolish to cavil at the perfectly sensible process of carrying it forward with the full consultation that the Minister has set out. I am delighted by the tone of her response and the fact that the Government are so awake to the need to do something here. The Minister has set a very good example for the consideration of the rest of the Bill. I thank her very much and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 263 to 265 not moved.]
Clause 326 agreed to.
Clause 327 [Retention and production of recordings]:
[Amendments Nos. 266 to 267 not moved.]
Clause 327 agreed to.
Clause 328 agreed to.
Clause 329 [Government requirements for licensed services]:
[Amendment No. 268 not moved.]
The basis of the amendment is to take account of evidence that the pre-legislative scrutiny committee received that the powers to constrain broadcast content should be limited on the face of the Bill to those of national security or public safety. The amendment proposes that that restriction on government and ministerial powers to censor broadcasts should be on the face of the Bill. I beg to move.
As a member of the Joint Committee on Human Rights, which also came to the same conclusions, I should just like to say that, unamended, these clauses are an assault on the right to freedom of expression and it is perfectly reasonable for the Government to circumscribe their own powers in the way that the amendment does.
I am glad that Amendment No. 268 was not moved; I could not understand it.
Amendments Nos. 269 and 270 seek to limit the grounds on which Ministers can direct broadcasters to carry an announcement or to refrain from broadcasting specified material. These powers have existed since the beginning of broadcasting. The examples that I have go back to 1927 and they have been only rarely used. However, the Joint Committee on Human Rights recommended that the grounds on which the power could be used should be specified on the face of the legislation. The committee of the noble Lord, Lord Puttnam, agreed with that.
We have considered the matter very carefully in the light of all the comments made. We take our human rights responsibilities very seriously. But we remain of the view that it would not be wise to delimit the power in the way proposed.
Let me explain. What we have discovered in research is that there have been a number of occasions on which these powers have been used over the past three-quarters of a century. On some occasions the restrictions which have been imposed by the Secretary of State have been included in the BBC agreement. On some occasions they have been patently absurd in modern terms and they have been withdrawn. We have decided to write to the Joint Committee on Human Rights to set out the whole history on that point; and I hope that that will be done within the next few days.
The difficulty is that the amendments restrict the powers of the Secretary of State to matters of national security or the safety of the public whereas in fact the European Convention on Human Rights is much more widespread. It states:
"The exercise of these freedoms, since it carries with it duties and responsibilities, may be subject to such formalities, conditions, restrictions or penalties as are prescribed by law and are necessary in a democratic society, in the interests of national security, territorial integrity or public safety, for the prevention of disorder or crime, for the protection of health or morals, for the protection of the reputation or rights of others, for preventing the disclosure of information received in confidence, or for maintaining the authority and impartiality of the judiciary".
It is clear that that is a much wider protection than that provided by the amendments. I can give the Committee the absolute assurance that since the passage of the Human Rights Act, Ministers, and the Secretary of State as referred to in the amendments and in this part of the Bill, are constrained by the Human Rights Act and by the European Convention on Human Rights. Therefore, the protection of human rights which is provided by the Bill and by the constraints on Ministers by the European convention are wider than those provided in the amendments. On that basis, I hope that Amendment No. 269 will not be pressed.
Amendment, by leave, withdrawn.
[Amendment No. 270 not moved.]
Clause 329 agreed to.
Clause 330 [Promotion of equal opportunities and training]:
[Amendment No. 270A not moved.]
[Amendment No. 270AA had been withdrawn from the Marshalled List.]
[Amendments Nos. 270B to 271A not moved.]
Clause 330 agreed to.
Clause 331 agreed to.
Schedule 12 [Corresponding obligations of the BBC and Welsh Authority]:
[Amendments Nos. 272 to 276 not moved.]
I am not grateful to the Government for giving me the last amendment of the evening to move, but I am grateful to them for deciding not to take two very important sets of amendments at this hour in the middle of the night. I add only one other comment in that connection. I hope that we shall not make a general practice of sitting long after 10 o'clock, which is what the House decided in its wisdom and after proper debate earlier in the year. However, in the light of the circumstances tonight, sensible arrangements have been made and I, for one, am grateful for that.
I can be quite brief. This is a very simple amendment which takes up a recommendation of the Joint Committee to connect this sub-paragraph with what is now Clause 332(6). The amendment draws attention to the fact that the Secretary of State may by order alter the public service remit of S4C, but the earlier Clause 332(6) gives the Secretary of State the right to review the performance of the Welsh Authority in dealing with these matters and then to produce a report.
It seems strange to have a clause that allows the Secretary of State to produce a change in the remit without requiring a reference to the publication of the previous report. My amendment seeks to bring those two matters together.
The point has been made that the amendment is intended to bring the Secretary of State's power to amend S4C's public service remit into line with her order-making powers relating to the remits of the other public service channels laid out in Clause 267. We feel that this is to pursue the wrong analogy. The correct analogy is with the BBC. Like the BBC, S4C is both a public service broadcaster and an independent broadcasting authority funded by government grant. It is therefore quite different from the other licensed public service broadcasters referred to in Clause 267. Just as for the BBC, we do not consider it appropriate to link in the legislation a former review mechanism to any change to the remit. As we said when the pre-legislative scrutiny committee first recommended the change, an amendment to the remit may arise from a range of factors—not least a request from the authority itself.
If the concern behind the amendment is that the Secretary of State has too much power, under Schedule 12(3)(8) no change to the remit can be made without the approval of both Houses.
The review in Clause 332 is essentially permissive. It may happen but it does not have to happen. If it does not happen, any subsequent review must be at least five years later, if at all. It is very much a backstop power for the Secretary of State.
The reviews under Clause 260, by contrast, will include an examination of the fulfilment of S4C's public service remit. They will be presented to the Secretary of State and must happen at least every five years—more frequently if Ofcom believes that is appropriate or necessary.
I hope that the Committee feels reassured that S4C's remit will be changed only as a result of appropriate consultation. The Government believe that it is better to recognise the status of S4C that way, so I hope that the noble Lord will withdraw his amendment.