My Lords, our Amendment 1 would remove what we see as the most unnecessary part of a clause that we on this side see little point in having in the Bill at all. I will not go back over all our objections to Clause 1, which we laid out in Committee. I will instead restrict comments to this amendment. As was highlighted during the Committee's consideration of this clause, and as was hinted at earlier, Ofcom already has a duty to encourage efficient investment in infrastructure, so could the Minister explain why we need a new duty on top of the established one? What difference will this new duty make? Will it not, as my noble friend Lady Buscombe said, simply muddy the waters?
There could well be duplication and confusion from Ofcom exercising its functions under the Communications Act 2003 and the duty that the Government have set out in this Bill. We asked similar questions in Committee, but the answers were not enlightening. The Minister argued:
"It is right that the regulator should be responsible for this".
We agree but, as has been pointed out, under Section 3 of the Communications Act 2003 the regulator is already responsible for this issue, so I am not reassured by this argument. More significantly, when addressing the specific question of whether the duty was needed, and whether there would be any overlapping, the Minister argued:
"It is necessary and there will be no duplication, because we are doing this only once".-[Hansard, 6/1/10; col. 155.]
I am not entirely certain what that means. The key concern with this clause is that it does not seem necessary. It will, we feel, simply create confusion and overlapping functions. Could the Minister explain more fully quite why he thinks that this will not be the case and what is so wrong with Ofcom's existing duties, which include encouraging investment in infrastructure, that it is necessary to repeat this part of their duties? If the purpose is to underline this part of those duties, could it not have been done in a way that made the point without resorting to legislation?
The Government argued that the duty was needed because of,
"the specific importance of investment in electronic networks at a time when many of our communication networks are being substantively upgraded".-[Hansard, 6/1/10; col. 163.]
It would be helpful if the Minister could explain why the existing duty cannot deliver these upgrades. For instance, digital television switchover is already happening. It is being funded by the licence fee and, as far as I am aware, Ofcom does not have much of a role in the process. I would imagine that radio switchover could happen in much the same way.
I do not doubt that the regulatory environment needs to change to help to speed up investment in next-generation broadband, but would it not have been better to identify which specific measures are needed? Instead, we have this broad yet unfocused power that the Government are not entirely sure will result in much change. I am afraid that it looks as if the Government are simply adding a duty to give the appearance of action. As with so many things, the Government's response to a problem seems to be more regulation. Unless the Minister can explain exactly what marks out the duty as necessary and distinct from an existing duty, there is no reason to include it in the Bill and there is certainly no reason for this part of the clause. I beg to move.
My Lords, I made it clear in Committee that new subsection (1A)(a) places a clear requirement on Ofcom to consider the need,
"to promote ... investment in electronic communications networks".
There is a clear requirement on Ofcom to consider promotion of investment systematically. Currently, Ofcom is required simply to have regard to the desirability of encouraging investment when it appears to be relevant in the circumstances. It is therefore a significant change of emphasis and an important change in the way in which Ofcom carries out its duties. It would be incredibly short-sighted of us to miss this opportunity to ensure that the regulatory environment for these vital sectors encourages investment and growth.
Our policy objective as set out in the Digital Britain White Paper was clear that the general duties of Ofcom should be qualified by the need to promote investment. We concluded that the best way of achieving this was by the creation of a new Section 3(1A) (a), (b) and (c), which place a specific requirement on Ofcom to,
"promote ... investment in electronic communications networks", when performing its principal duty. In light of the considerable debate that your Lordships have stimulated, we have considered how we could make the clause clearer to address the matters raised. The result is a series of proposed amendments today-Amendments 2, 3, 5, 6 and 7. The new wording clarifies how the clause will work in practice.
As the right reverend Prelate the Bishop of Blackburn admirably said in Committee, maintaining the duty for Ofcom to promote investment in infrastructure and public service content so as to help to secure our economic and social prosperity in the future,
"seems entirely sensible, even highly desirable".-[Hansard, 6/1/10; col. 161.]
Removing that obligation on Ofcom to promote investment in our communications networks of the future would send an entirely wrong message about our commitment to such a programme of improvement. The duty will not cause confusion. It would not be right to state specific measures, but it is important to encourage investment when it appears to be relevant in the circumstances. It is an important change of emphasis; it is now a principal duty. I hope that in the light of that explanation the noble Lord will feel able to withdraw the amendment.
My Lords, I thank the Minister for his response, but I am afraid that I have heard nothing new today, so I should like to test the opinion of the House.
My Lords, Clause 1(2) of the Digital Economy Bill requires Ofcom in performing its principal duty to have particular regard in all cases to the need to promote appropriate levels of investment in electronic communications networks in public service media content and to have regard to the need for the investment to be efficient wherever possible.
In Committee, a number of your Lordships questioned the meaning of "efficient" investment and the suitability of the phrase "appropriate levels of investment". Certain of your Lordships were also concerned that the clause, as written, failed to address what they saw as the failure of Ofcom to fulfil its duties to citizens. We have looked at whether changes to the wording of the subsection might be improved to reflect the Government's intention and we are, as a result, proposing a package of changes to new subsection (1A) that I trust will meet the concerns raised in Committee.
I want to make it clear that Ofcom's principal consideration when making any decision must be the interests of citizens and consumers. The new duty is an aspect of that obligation. We are not introducing a power for Ofcom to impact on individual companies' investment decisions. Instead, the provision is intended to ensure that, as many of your Lordships argued in Committee, when Ofcom is taking regulatory decisions it has in mind the need for investment in public service media content and networks fit for ever increasing demands and next-generation technologies, for the benefit of all and not just the companies involved.
The amendments in this group, I hope, make this clearer by setting out more clearly what is meant by the words "efficient investment". This is, in the broadest sense, what we generally refer to as economically efficient, taking into account the benefits to investors, consumers and wider society. This definition therefore now captures investment that is efficient in commercial or social terms. Investment in public service media content, for example, would be efficient if the social benefits to citizens outweighed the cost of providing the content.
A question was also raised as to whether the reference to "appropriate levels of investment" was appropriate. We have looked again at this. Consequently, we are proposing amendments to paragraphs (a) and (b), which will require Ofcom to consider whether it would be appropriate to promote investment per se, rather than require it to make a specific judgment on the level of investment that would be appropriate in a given instance.
Finally, there was uncertainty about how this new subsection relates to the existing provisions in Section 3(4) of the Communications Act. To put this beyond doubt, the intention is to require Ofcom to give precedence to the need to promote investment where there is a tension between this need and the subsection (4) matters.
I hope that noble Lords will agree that these amendments make the intention of the clause clearer and that they appropriately reflect the need for Ofcom to promote the interests of citizens and consumers. I therefore ask your Lordships to support these amendments. I beg to move.
My Lords, it is a pleasure to see that the Government have listened to some of the concerns that the House raised during the drafting of Clause 1. There are still issues with the clause, but I will save those worries for my amendments. For now, I shall turn my attention to the amendments proposed by Her Majesty's Government. I am grateful for the explanation provided in correspondence by the Minister regarding the Government's thinking on these amendments. As he said, they have had to go back to the drawing board on the specific issue of efficient investment. I was slightly worried that by addressing one concern, the Government may have raised others, but I hope that this debate can lay those to rest.
This clause now states that Ofcom will promote investment in "electronic communications networks" and "public service media content", where appropriate. That is an important distinction. However, it throws up a number of important questions about the meaning of the word "appropriate", which were not dealt with in Committee. For instance, who decides when an investment is appropriate? By what criteria will such an investment be judged? Will investment be considered appropriate if it leads to faster broadband speeds, greater profits for a company or greater competition in the market? Depending on what criteria are used to define "appropriate", the outcome could be markedly different.
The Minister wrote to the noble Lord, Lord Mitchell, regarding these amendments, stating that,
"unlimited investment in all features of an electronic communications network will not always be appropriate".
I agree. There are always other considerations that will need to be taken into account in determining whether the investment is justifiable on public policy grounds. The Minister referred to those of those a few moments ago. Some clarity on the Government's definition of appropriateness would be helpful, not least for the regulator who will need to balance these new duties with existing ones.
The addition of the phrase,
"taking account of the interests of citizens and the interests of consumers in relevant markets", presumably ensures that the interests of consumers will be considered when determining the appropriateness of an investment. But what other factors should be considered? Perhaps I am in danger of reading too much into this, but I cannot help thinking that "where appropriate" could just be a generic phrase that gives the regulator enormous leeway in making its decisions. There is a danger that such leeway could create uncertainty for the industry, as businesses will find it difficult to know how the duty will be interpreted.
All organisations need certainty and a clear and level regulatory playing field. The telecommunications sector is no different, and given the amount of investment required to upgrade the country's communications networks and the length of time required for a return on such an investment, anything that muddies the waters or causes doubt should give pause for thought. Is the Minister confident that the addition of "where appropriate" will not lead to uncertainty-uncertainty that threatens the investment this duty is designed to promote? Finally, can he reassure those of us who remain unconvinced that this clause is needed at all that these amendments significantly enhance those duties that Ofcom already has?
My Lords, I very much welcome these government amendments, and particularly Amendments 2 and 3. It is primarily lack of investment in much of the infrastructure, particularly in local and rural areas, that has given rise to Amendment 9A to which I will speak later. The amendment stands in the name of the noble Lord, Lord Laird, and I would have added my name to it if I had not been away. I am sorry about that.
I welcome Amendment 7 which will remind Ofcom of its duty to take into account the interests of citizens. It is all too easy to think of these things in terms of business and profitability, but there comes a point when we must invest in infrastructure. It will not necessarily be seen to be efficient in business terms to start with, but we will get huge rewards further down the line and in other areas of life which may not be strictly relevant to the communications market but will be relevant to many other markets.
My Lords, my noble friend the Minister has addressed many of these issues, but I still have a concern over "appropriate". In some ways it sticks-it just does not feel right in Amendments 2, 3, 5 and 6. I want to tell noble Lords the reason for this, which is generic to this industry.
I learnt something new this weekend. I came across a new word: exabyte. I have never heard that before. An exabyte is a billion gigabytes, or a billion billion bytes-it is a pretty big number. In 2005, mankind created 150 exabytes; in 2010, 1,200 were created. So, over five years the total amount of data created on earth went up by a factor of 10, and I suspect the rate of increase is going to continue on an exponential basis. If we were standing here in two or three years perhaps we would need another word for a thousand exabytes. I do not know whether there is such a word; maybe there is.
Even since the Digital Economy Bill was introduced in your Lordships' House three months ago there have been many changes. We have had two major exhibitions in the world: the Consumer Electronics Show in Las Vegas, and a month later the GSM Mobile World Congress in Barcelona. At both those events, major new products were introduced which were dramatic and will change the face of the whole industry. There have been smart phones, tablets, and of course a month ago Apple announced its iPad tablet. On the subject of Apple, last week it recorded 10 billion downloads from iTunes-nearly two for every person living on this earth. As I mentioned once before, there have been 3 billion downloads of apps for the iPhone. Convergence, about which we have talked many times in this House, is now a factor of life; it is happening at a very dramatic rate. Also since the Bill was introduced, we have heard that in the United States, AT&T's network has been struggling with the amount of data required, and O2 has reported problems coping with the amount of data on a broadband basis or mobile network basis.
To return to the word "appropriate", I want to make the point that I do not like the tone of the word. It does not feel right. It feels, as the Minister himself said in a meeting with me, as though the word is limp. It certainly does not capture the change that is taking place in this industry. It would be more appropriate if we were talking about agriculture or the steel industry, but the IT and mobile industry is changing so fast that we need something that recognises that change more, dare I say it, appropriately.
My Lords, we seem to be halfway towards pleasing the House if not completely there. I am pleased that we have made some progress in trying to address the problem. I would say to my noble friend that he should take the amendments as a whole. The previous amendment elevated the role of Ofcom to ensure that investment in electronic communication networks was one of its principal duties, which is an important change. I have been trying to get something helpful rather than a legal definition that might engender more of a collective groan than anything else.
However, this is not about particular investment decisions but about the creation of a regulatory climate that encourages investment. I know that that is what my noble friend Lord Mitchell wants to do. He seeks to encourage investment in an environment where, as he eloquently described to us, demand is exponential. What is interesting is that so far, and there is no room for complacency, we have managed to meet that demand. We know that there are other things we need to do in terms of the UK providing universal broadband and super broadband and we are focusing on those areas.
I also want to make it clear in relation to the concern of the noble Lord, Lord Howard, that Ofcom's principal consideration when making any decisions must be the interests of citizens and consumers, and the new duty is an aspect of that obligation. We are not introducing a power for Ofcom to impact on individual companies' investment decisions. Instead, the provision is intended to ensure that, as many of your Lordships argued in Committee, when Ofcom is taking regulatory decisions it has in mind the need for investment in public service media content and networks fit for ever-increasing demands and next-generation technologies-to take up the point made by my noble friend Lord Mitchell-for the benefit of all and not just the companies involved. I have endeavoured to address those concerns and, in the light of that, I hope that noble Lords will support the amendment.
Amendment 2 agreed.
Moved by Lord Young of Norwood Green
3: Clause 1, page 1, line 9, at end insert ", where appropriate"
Amendment 3 agreed.
Moved by Lord Howard of Rising
4: Clause 1, page 1, leave out lines 10 and 11
My Lords, this is a probing amendment to seek clarity about what the Government are trying to achieve with this part of Clause 1 and, more significantly, to try to understand what the implications will be of the new definition of public service media content. The Minister was kind enough to write to me following our debate on this topic in Committee. In his letter, he confirmed that the Government's new definition of public service media content could include blogs,
"to the extent that these contribute to the public service objectives set out in section 264(6)", of the Communications Act.
As I pointed out in previous debates, these objectives include a wide variety of topics, ranging from religious and educational topics to entertainment and comedy. As such, it could be argued that almost any website where an individual has editorial control could fall under these objectives-anything from the obvious, such as newspaper sites and political blogs, to comedy, show reviews or even online video games.
Is it the Government's intention that Ofcom should promote investment into almost anything on the internet? It is hard to see how this will work in practice. I am sure that the aim is not intended to be so broad, but it is what the definition provided in this Bill could lead to.
The Minister argued in his letter that we need to give Ofcom sufficient flexibility to take into account new forms of public service media content. The need to allow public service broadcasters to invest in distributing public service content in new ways, notably through the internet, is understandable. However, surely what the internet shows is that public service content online is very much alive and well. The whole point of the internet is that services spring up where there is a demand for them. Excellent work is created without Ofcom promoting investment.
I therefore urge the Minister to think again about whether such a duty is necessary and, more importantly, whether such a broad definition of public service media content will not make the duty so unwieldy as to become meaningless. I beg to move.
I should like to echo one or two of the points that my noble friend has just put. Exactly like him, I seek guidance on what this section means. As the noble Lord knows, I am a strong supporter of public service broadcasting-not just the BBC but Channel 4, ITV and the other public service broadcasters-so there is absolutely no question of my not supporting it. What I do not understand is the duty placed on Ofcom,
"to promote appropriate levels of investment in public service media content".
That is what I do not understand-the promotion.
For once we are not talking about what is "appropriate" but about what "promote" actually means. Does it mean that it is the duty-or that it is possible or conceivable-that Ofcom could push for more public spending, so that more money could be spent in this area? If it does mean that, does it not bring it smack up against the department that is responsible for spending? In other words, there would be a divided voice. You may well find the department takes one view and Ofcom takes another. Perhaps that is not the intention. However, it is such an extraordinarily wide definition that it seems that Ofcom would be entirely entitled to take whatever view it wanted as a result of this.
The most useful thing that the Minister could do is to give us examples of what this section means in practice. In other words, what does promoting appropriate levels of investment in public service media content actually mean when it comes down to it? That would be very much for the convenience of the House.
My Lords, I am grateful to the noble Lord, Lord Howard of Rising, for introducing this amendment and to the noble Lord, Lord Fowler, for his comments. It will already have been recognised in our debates on the two preceding groups of amendments that the Government have listened carefully to the anxieties that have been expressed in parts of the House about this issue. We have sought to respond as constructively as we can.
When we spoke about the issue in Committee, we made clear the importance of placing consideration of the need to promote investment in public service media content as one of the most important qualifiers of Ofcom's principal duty. We made it clear that paragraph (b) places a clear requirement on Ofcom always to consider the impact of its decisions on the need to invest in public service media content.
Public service media content aims to fulfil the specific objectives set out in the Communications Act 2003 for the benefit of the public. The noble Lord, Lord Fowler, is undoubtedly an authority on that Act, and I have no doubt the noble Lord, Lord Howard of Rising, is becoming one. Certainly, I recall that the noble Lord, Lord Fowler, spent a great deal of time debating these issues when the Communications Act was eventually passed in 2003. The specific objective set out in that Act is the benefit to the public. That objective is highly valued by viewers and listeners and has clear social and economic benefits for the UK. Plurality of public service media content drives healthy competition with the BBC-I am sure that that will commend itself to the noble Lord, Lord Howard of Rising, and to his noble friend-and with purely commercial content.
I emphasise that, in fulfilling this obligation, Ofcom is not taking on new powers. This is a clarification of the powers that Ofcom has under the Communications Act in circumstances where, from time to time, the changing nature of media presents real and obvious anxieties. Changes to the market in recent years threaten aspects of public service media content. I know that the noble Lord, Lord Fowler, and the House committee that he chairs have drawn attention to these matters when we have debated these points in the House on the broader issue of broadcasting policy.
We consider that Ofcom's existing duty to consider, where relevant, the desirability of promoting the fulfilment of the purposes of public service broadcasting no longer goes far enough. We risk losing plurality in certain genres of public service content. We are not seeking to make Ofcom intrusive but to see that it is placed to evaluate where it can encourage investment and where loss of plurality would be a cost to society. I know that the noble Lord, Lord Howard of Rising, sometimes needs persuading on this point, but we are concerned to emphasise that economic benefits must include social benefits for the community in terms of access to a plurality of sources of provision. It would be detrimental to society and to the industry if we saw erosion take place in that regard, and Ofcom would have no powers to respond to it. The House will appreciate that the Bill seeks to project the discussion and the necessary provisions into the immediately foreseeable future and the more distant future. We want to see Ofcom adequately equipped to fulfil its obligations in that context. Clause 1 therefore strengthens Ofcom's existing duty under the Communications Act and makes a firm commitment to the need to promote investment in our public service media content.
A few moments ago, we sought from the government side to clarify the meaning of this clause by additional amendments, which is a reflection of the debate that we had in Committee. I hope, therefore, that that is regarded as progress. I emphasise that we cannot predetermine the form and delivery of public service media content in every respect in the years to come. This is obvious from the rapid changes which have arisen from digitalisation over the past decade. It is important that Clause 1 gives Ofcom sufficient flexibility to take into account new forms of public service media content provided by means of the internet, where it is appropriate to do so.
I emphasise-at least to allay, if I can, the concerns of the noble Lord, Lord Howard; and I think that I will probably be able take the noble Lord, Lord Fowler, with me on this point, though I may be presuming too much-that Ofcom will be required to consider the need to promote investment in public service media content only when performing its principal duty as identified in the 2003 Act-and nothing in this Bill detracts from it-to further the interests of citizens and consumers as it carries out its functions. That is the context in which Ofcom will continue to act. I hope that the noble Lord will therefore feel that the Government's case is made out, against the background of the emendations that we have made by the previous government amendments, and that he can safely withdraw his amendment.
Yes, my Lords; but Ofcom, of course, operates within the constraints established in existing legislation. On the noble Lord's suggestion that this might give rise to tensions between the department and Ofcom, I have no doubt that in an extreme case, where the issue was of such substance that Ofcom was convinced of very substantial investment being necessary, it is inconceivable that the Secretary of State and his department would not be clearly aware of such issues and would not be very much part of the public debate which had identified the nature of the threat to the public of the loss of plurality of services. It is not as if, under this Bill, Ofcom is operating in a vacuum in which wider considerations are not taken into account. In fact, as we have indicated all along, Ofcom is to take firmly into account the interests of citizens and consumers. The noble Lord, Lord Fowler, would be the first to identify the fact that when we ask Ofcom to do that, we expect it to be all too well aware of the points being made by Ministers, by informed opinion in the other place, and, dare I say it, by informed opinion in this place too, of which the noble Lord's committee might be an important part.
I thank the Minister for his reply. I also thank my noble friend Lord Fowler for his support; it is always nice to have support from such a knowledgeable and distinguished source. If we take it that we accept the investment need and the desirability of the investment, as explained by the Minister, it seems that in seeking to improve the width and breadth of what Ofcom can do, the Government may have gone too far. I can understand the requirement to maintain plurality, but if the Minister reads through my remarks he will see that they could be interpreted as applying to all sorts of things that might be miles away from what the Minister and the Government are thinking of. Perhaps he would like to give that some thought, but in the mean time I beg leave to withdraw the amendment.
Amendment 4 withdrawn.
Amendments 5 to 7
Moved by Lord Davies of Oldham
5: Clause 1, page 1, line 10, leave out "appropriate levels of"
6: Clause 1, page 1, line 11, after "content" insert ", where appropriate"
7: Clause 1, page 1, line 12, leave out ", wherever possible" and insert "(taking account of the interests of citizens and the interests of consumers in relevant markets)"
Amendments 5 to 7 agreed.
Moved by Lord Lucas
8: Clause 1, page 2, line 2, at end insert-
"( ) After subsection (4)(e) insert-
"( ) the desirability of encouraging competition in electronic communications services provided over communications networks;
( ) the needs of the emergency services and the providers of critical national infrastructure;"."
My Lords, this amendment brings forward some issues that we discussed at length in Committee. There are two quite separate issues. The first reflects a debate, which the Government have dealt quite well with in their Amendment 6, on the fact that we needed to remind Ofcom of its duty to citizens and customers.
One particular illustration of that-which struck me as we were doing research for the Committee and which I would like the Government to take account of in the first part of this amendment-is the way in which Ofcom has chosen to deal with various electronic communications service monopolies or effective monopolies. One of the fundamental purposes of Ofcom ought to be to stand up for the consumer where we, as a Government, and it, as Ofcom, have allowed effective monopolies to be created. These are monopolies like Microsoft's operating systems. I see that the European Commission has had a hand in unlinking Microsoft from Internet Explorer and letting the other browser producers have wider access to Microsoft's customers. This sort of effective monopoly comes from having taken one decision and then being bound into others, which is current in bits of the communication market.
I give two examples. If you are a subscriber to British Telecom's voice over internet services, you will find that you are excluded from all but their own directory enquiries. You actually cannot get through to their competitors at all-the numbers are blocked-whereas we have been to considerable lengths, in other spheres, to make sure that people had equal access to all the competitors on landlines. It is time that Ofcom said something about the desirability of that practice. Locking customers in to essentially uncompetitive services is something which Ofcom ought to be taking into account. Instead, it seems to be totally focused on wanting British Telecom and other voice over internet providers to be able to make substantial profits because it sees it as a young industry. I do not think that it is a young industry; it is becoming a pretty old and universal industry now. Ofcom ought to be coming back to say, "Right, you've grown up, lads. Now there is a grown-up set of rules for you to obey".
Even in mobile telecoms, which is a pretty mature industry, you find some strange practices in this country. Several of the operators will charge you £1.50 to access a competitive directory enquiries service, whereas in France, where the authorities have taken action, the mobile telecom operators impose a mark-up of about 15 per cent on the price charged by the directory service provider. It is something like four times as high in this country, which is due entirely to the fact that Ofcom has refused to do anything about it. It seems to me that Ofcom should be reminded that it has a real duty to the customer and that there are real problems here which it ought to be moving gently and sensibly to sort out. It is a major force and has a lot of power. It does not need legislation or litigation to deal with these problems. All it needs to do is to come out and say that it finds these practices undesirable. Over time they will go because otherwise, as I am sure the industry realises, there will be legislation or litigation to make sure it happens. However, Ofcom absolutely has to stand up for the consumer in these sort of cases.
The second part of the amendment deals with the provision of spectrum to the emergency services. I am afraid that I have had a very unsatisfactory letter from Ministers on this. My basic case is that we know that at some stage there will be a demand for additional spectrum for the emergency services. It is not there at the moment because they do not have the budget, and they do not have the budget because budgets are being squeezed everywhere. However, it is clear that the situation in which the emergency services operate on kit whose concept is 10 to 15 years old cannot last.
The capacity and capability of mobile telecommuni- cations have vastly increased and look set to increase further. When we come to the point-perhaps five years in the future-when we feel prosperous again and decide that the provision we make for our emergency services should be stepped up, we should have the capacity to do so. In their letter to me, the Government recognise that this is likely to be around the 1-gigahertz point in the spectrum-the bit of the spectrum which has been freed up by the digital dividend and which is being looked at in a European context for harmonisation. It is the bit of the spectrum which Ofcom is determined to sell as quickly as possible to the highest bidder. Therefore, when we reach the point when we want to do something for our emergency services, we will have to put them in another bit of the spectrum, and the kit that we have to buy for them will be a great deal more expensive because it will have to be arranged specially. There will be no opportunity, as there has been with the current system, for our industries which supply the kit to market that kit world wide.
The current system has been a tremendous success. Taking standardisation forward for the current emergency services spectrum, we have been able to sell the kit that we produced for ourselves to a very large number of other countries. That has been a great boon to British industry, which is very much in the lead in this sector. However, the Government are refusing to recognise that. They say that they want to sell the spectrum for which they can find a commercial demand now and set nothing aside for the future emergency services spectrum. That seems to be a dangerous and muddle-headed approach. I do not think that they will have time to do it before the election, so perhaps it will be their successor who has control over this. I believe that one function of government, and therefore one function of Ofcom, ought to be to have regard to our long-term requirements as a nation regarding the spectrum that we want to use for our national security and our emergency services. Subordinating that to short-term commercial interests seems extremely foolish. I beg to move.
My Lords, I support the amendment wholeheartedly, especially the part concerning the emergency services and spectrum for the critical national infrastructure. Sometimes we forget that the utilities such as electricity and water, on which we are totally dependent, rely on telecommunications for their infrastructure and that, as sophistication increases and control systems get better, they, too, will need a larger bandwidth. If we do not start reserving this at a strategic level, it will get sold.
The big challenge at the moment concerns the huge shortfall in finance at government level. Whichever party, or perhaps coalition, is in power after the next election, one easy way to try to raise money will be to sell a full spectrum quickly. However, this is not a vote-catching issue. As the noble Lord, Lord Lucas, said, we will wake up at some point in the future to find that, instead, we are faced with a huge expense because this spectrum, under the guise of efficiency, market forces and so on, has been sold off.
I, too, have received letters saying that the Government's approach to this at the moment is totally inadequate. I hope that the Government will listen and include something at Third Reading or when the Bill goes through the Commons in order to protect with absolute certainty the spectrum that will be needed for international co-operation, for our emergency services and for our critical national infrastructure; otherwise, one morning we may wake up to find that there is no electricity.
My Lords, I supported this amendment, or one very similar to it, in Committee. The more I have heard the noble Lord, Lord Lucas, expand on this amendment and the more information I have received from other sources, the keener I am to support it. The example of Microsoft being "encouraged" by Europe to open up to competition is absolutely as it should be. Those of us who live in areas with very poor broadband provision are aware of just how much competition is needed to ensure that the latest methods gain ground to the benefit of us all. However, as has been said, the emergency services aspect of all this is absolutely crucial. During our mini crisis with the snow and so on, a number of areas were failed by a lack of resources and a lack of megabytes. Therefore, I am very much in favour of the amendment. Together with the noble Earl, Lord Erroll, I hope that the Government will take this matter equally seriously, realise how much support there is for it and perhaps bring back an amendment of their own.
My Lords, there is a lot of sympathy from these Benches for much of the amendment. A lot of the debate about how we best equip this country for the digital economy has been focused on investment in infrastructure. Although it is important that the necessary infrastructure is in place, particularly for the next generation of broadband, what will drive demand for increased broadband speeds are the services that can be delivered. There is therefore some sense in ensuring that Ofcom gives regard to the promotion of competition in electronic communications services. I am always reluctant to add to a regulator's duties unless there is a specific problem that needs addressing, and I should be interested in hearing the Minister's view on whether this is indeed the case.
Finally, I want to deal with the second part of the amendment regarding the emergency services and critical national infrastructure. It seems obvious that our communication networks must be able to serve those two critical areas. We must be aware of any potential problems with either the emergency services or our national infrastructure. I only ask whether Ofcom is currently equipped to do such a job. As a largely economic regulator, I wonder whether it has the necessary skills for this particular role. I look forward with interest to hearing what the Minister says.
My Lords, this amendment is in two parts, and the first part concerns the duties of Ofcom in relation to competition and the desirability of encouraging competition. I did not quite recognise the world that was being described. I see a world where there is a lot of competition in relation to broadband services and telecoms and mobile services. Should we be complacent? No, we should not, for some of the more complicated reasons addressed by the noble Lord, Lord Lucas.
However, I stress that with respect to every decision it takes, Ofcom must, where it is the appropriate means of furthering the interests of consumers, promote competition in the markets that it regulates. Furthermore, Ofcom must, in any event, consider the desirability of promoting competition in those markets. Therefore, it has an emphatic duty in that regard. Again, if one looks at the range of service providers in internet services and telecoms, both fixed network and mobile, one sees-without suggesting that we should be complacent-a wealth of evidence of real competition. In addition, Ofcom addresses anti-competitive practices and agreements. Indeed, this underpins the majority of its work. Therefore, if we have the kind of scenarios that the noble Lord, Lord Lucas, described, they clearly need to be referred to Ofcom.
It is therefore not clear just what the proposed amendment would add, and, on that basis, the Government cannot agree with it. I tend to agree-I do not always-with the noble Lord, Lord Howard, that we would not want to extend Ofcom's powers if there were not the need for it. I absolutely agree that it is about driving demand for broadband services, and that is what it has been doing pretty well.
On the second part of the amendment, my understanding is that the noble Lord, Lord Lucas, is concerned to ensure that Ofcom considers the spectrum needs of the emergency services and providers of critical national infrastructure. I stress that Ofcom already has a duty under Section 3(4)(f) of the Communications Act to consider,
"the different needs and interests ... of all persons", when considering spectrum use. Importantly, this includes the needs and interests of the emergency services and providers of critical national infrastructure. I understand and take the point made by the noble Earl, Lord Erroll, about the way in which our infrastructures control their own networks, so that there will be more requirement for spectrum. However, Ofcom already has a duty to consider that. As I think we made clear in a previous debate, consultation is already taking place.
The Secretary of State will, where he considers it appropriate, use the power given to him by the Wireless Telegraphy Act to require Ofcom to make spectrum available for certain uses or users. Therefore, we consider that no amendment is needed to give effect to the intentions of the noble Lord, Lord Lucas. We do not see a scenario in which Ofcom blithely goes ahead and disposes of all the spectrum in a grand sale or auction. I do not think that we will ever see quite what we saw on third generation-but who knows? However, it certainly does not have the power to do that without considering the requirements of the emergency services and critical national infrastructure.
I can offer the noble Lord an assurance that if the emergency services have a robust case for additional spectrum which they are unable to source from the market, a process exists to address that need. Ensuring public safety-to address the concerns of the noble Baroness, Lady Howe-would be a paramount consideration in that process.
The Civil Contingencies Act 2004 contains emergency powers to allow the making of special temporary legislation to deal with the most serious of emergencies. Such legislation could cover the temporary allocation of spectrum to the emergency services and critical national infrastructure in the event of a national emergency. However, the emergency would have to be of sufficient magnitude that serious damage to human welfare, the environment or security were threatened, existing powers are insufficient and the measures being taken are proportionate.
I therefore feel that Ofcom's existing powers can deal with the requirements of the emergency services. It has a duty to do so. I hope that in the light of the assurances that I have placed on the record, the noble Lord will feel capable of withdrawing his amendment.
I thank the Minister very much for that reply. I think that he has convinced me that this amendment should not go into the Bill. On the first part, I am clear that the matter is already there to his satisfaction in the current legislation, and I think that we both agree that this is merely a question of Ofcom not performing as it should the duties that it already has. So I shall continue to badger Ofcom about that. When it comes to the allocation of spectrum, there is a substantial division between us; but it is not a division for this legislation but a matter of the policy to be pursued by the Government in the long-term interest of the nation. I do not see, for all his professing the supremacy of the requirements of national security and so on, that the actions he is allowing Ofcom to take fit in with that. For now, however, I beg leave to withdraw the amendment.
Amendment 8 withdrawn.
Moved by Baroness Buscombe
9: Clause 1, page 2, line 14, at end insert ", excluding online newspaper and magazine websites"
Let me begin by once again declaring my interest in this matter as chairman of the Press Complaints Commission and making it clear that I am not here to represent or support the newspaper industry. My interest relates wholly and directly to the crucial issue of self-regulation or, as I would prefer to call it, regulation that is entirely independent of the state.
My concern is to ensure that the Bill does not diminish the freedom of the press and magazine industry to publish news online that may be partial, including news where there is a person exercising editorial control over that published material. I am grateful to the Minister for taking the time to discuss this matter with me between Committee and Report.
The issue is a thorny one. I accept without reservation that, where news is disseminated by what can be clearly defined as public service broadcasting, the provision of that news must be subject to the usual rules of impartiality. What is not clear in the Bill is the situation with regard to newspaper and magazine websites, which are not regulated by Ofcom and are not subject to any rules or codes of impartiality. They are regulated by the Press Complaints Commission, which, of course, is a body that itself is not regulated by statute and is independent both of the newspaper industry and of the state. I am concerned that the proposed amendment to the Communications Act in Clause 1(5)(c) appears to give Ofcom new powers to regulate newspaper and magazine websites. I appreciate that Ofcom has given clarification and guidance notes that this will not be its intention, but clearly, if that is not incorporated into primary legislation, theoretically at least the power will exist.
As I am sure the Minister is aware, the audiovisual media services directive recital states:
"The scope of this directive should not cover electronic versions of newspapers and magazines".
I am concerned that the exemption of newspaper and magazine websites, explicitly mentioned in the AVMS directive, has still not been incorporated into English law, either in the Audiovisual Media Services Regulations 2009 or, thus far, by the Bill as currently drafted, and that the audiovisual material on the websites of magazines and business publishers may be caught by the regulations despite this not being the intention of the directive. It is important to note that the Press Complaints Commission remit covers editorial material on newspaper and magazine websites where it meets two key requirements: that the editor of the newspaper or magazine is responsible for it and could reasonably have been expected both to exercise editorial control over it and apply the terms of the code; and that it was not pre-edited to conform to the online or offline standard of any other media regulatory body.
In effect, if the material is not sourced from broadcasters, such as the BBC or ITN, but is original to the paper, it is covered by the Press Complaints Commission, not by Ofcom. In moving this amendment, I am therefore respectfully asking the Government to make it clear that the Bill's extensions of Ofcom's general duties will not give Ofcom any new powers over any content, including audiovisual content, on newspaper and magazine websites. I beg to move.
I strongly support this amendment. My noble friend Lady Buscombe has, with her usual laser-like precision, tackled one problematic aspect of the Bill's definition of public service media content-namely, that it will mean that Ofcom has a duty to promote investment in newspaper and magazine websites. At the moment the newspaper industry has its own regulator, the Press Complaints Commission, chaired so ably by the noble Baroness. It would not be wise to extend Ofcom's remit into this realm. I am not sure that the sector would appreciate Ofcom having a specific duty to promote investment into it. As the noble Baroness has made these points far better than I will be able to do, I will simply congratulate her on bringing forward the amendment and hope that the Minister listens carefully.
I bow to no one in my admiration for the laser-like precision of the noble Baroness, Lady Buscombe, but I would like to clarify something that bothers me. Is the noble Baroness suggesting that, in the event that broadcast material that had been turned down or not used by the public service broadcasters because of its content became available, a newspaper or magazine could put it on its website as broadcast material, avoid any sanctions that Ofcom could bring and fall under the PCC only? If that is the case, the PCC is giving itself an enormous new problem. The other day, the noble Baroness was very eloquent about a particularly difficult situation that she felt did not quite cross the line. I suggest that a great deal of material will start crossing the line. I want to be clear about what is broadcast and what is material that would normally be expected to come from a newspaper or magazine.
I shall put it the other way round. The BBC website, in particular, often provides links to other websites. If the noble Baroness's amendment were accepted, would the BBC be unable to link to a newspaper story that was not balanced or would that story then become part of the process of balancing by the BBC Trust or Ofcom?
Following that intervention, I hope that the Minister will range widely in his answer. It is not clear to me where old terms such as "newspaper" and "magazine" belong in the modern world. Many of the magazines that I read have no physical existence. Page-turning technology means that you now get something that feels very like a magazine. You can browse it and enjoy it very much as you do a paper magazine. New sources are developing outside the newspaper industry and, the more the newspaper industry tries to make life difficult for its customers, the more these sources will flourish. Where do the Government see the boundary between the part of the media world that has to have balance and the rest of it that does not? How will they draw that boundary in relation to things that are happening on the internet now?
These are the seductions of office, my Lords. The last three contributors invited me to range widely as a result of this amendment. I think that the noble Lord, Lord Lucas, is asking me to define in a few succinct phrases over the course of an hour and half the purposes of this section of the Bill. I shall resist such blandishments and opportunities because noble Lords who contributed to this debate will recognise that I am concerned to allay the anxieties that the noble Baroness, Lady Buscombe, voiced when we discussed these issues in Committee. When we subsequently met to clarify them, she spoke on behalf of the Press Complaints Commission to express its anxieties. That is a significant enough body for me to address it formally to give the assurances that I can give. I hope that I will obtain the withdrawal of this amendment, despite the fact that my reply will fall somewhat short of the expectations, and even perhaps the hopes, of my noble friend Lord Puttnam. It will certainly fall short of the expectations of my noble friend Lord Maxton and, by a country mile, of the hopes of the noble Lord, Lord Lucas. I shall not go over this ground again, nor will I engage in the kind of debate where, if we were not careful, we could be here for many a long hour.
In her amendment, the noble Baroness makes it clear that she is concerned that Clause 1 grants Ofcom new powers to regulate newspaper websites. I reassure her that Clause 1 does not grant Ofcom any powers to regulate newspaper websites, including audiovisual content. I should also make it clear that the definition of "media services" in subsection (5) covers newspaper websites. As ever with government Bills, this is quite deliberate and constructive. It may benefit newspaper websites to the extent that, in carrying out its functions, Ofcom will be required under Clause 1 to have regard to the need to promote investment in content included in newspaper websites that contributes or may contribute to the public service objectives at the heart of the obligation on Ofcom. Ofcom has advised us that such instances will be rare, but I hope that noble Lords will agree that including online newspapers in the definition of "media services" would be advantageous.
I want to emphasise an additional point. The AVMS regulations 2009 require Ofcom to regulate on-demand programme services. The regulations define an on-demand programme service as having as its principal purpose the provision of programmes of form and content comparable to programmes normally included in television programme services. The principal purpose of newspaper websites is not to provide on-demand programme services, even where they currently provide some audiovisual content. It is theoretically possible that newspaper websites could provide such on-demand programme services in future. In such a case, the regulations would not-I emphasise this again, as it is the main cause of the anxiety of the noble Baroness, Lady Buscombe-require Ofcom to regulate the entire newspaper website, just the on-demand service that it is obliged to regulate.
That is the response to the amendment. There may be-I hope not-occasions on later amendments when I can deliberate a little further as I have been invited to do on this amendment, but this amendment was tabled with the specific objective in mind that we should clarify the matter. I have sought to do so and I hope that noble Baroness will withdraw her amendment.
I thank the Minister for his reply. Perhaps I can remind noble Lords that, as this is Report, it was not within my power to respond to questions. The Minister responded in a way that is helpful to my amendment. We have to allow for some pragmatism because the focus of the amendment is the question mark over new forms of public service media content. There is a need to differentiate the regulation of the websites of the press and the magazine industry and the regulation of a situation where there is public service media content. As the Minister suggested, there may be rare instances where that may include content that originated from newspapers and is specifically aimed at or provided for public service broadcast. I thank the Minister for taking the time to cover this crucial issue and to give me a helpful reply. I beg leave to withdraw the amendment.
Amendment 9 withdrawn.
Moved by The Earl of Erroll
9A: After Clause 1, insert the following new Clause-
"Duty to establish scheme to deal with complaints, faults and requests regarding broadband and its associated data and signal carrying cables
(1) The Communications Act 2003 is amended as follows.
(2) After subsection 27 insert-
27A "Duty to establish scheme to deal with complaints, faults and requests regarding broadband and its associated data and signal carrying cables
(1) It shall be the duty of OFCOM to establish a scheme for the reporting of complaints about, and requests for repairs to, broadband and associated data and signal carrying cables, and services.
(2) When establishing the scheme under subsection (1), OFCOM must ensure that the scheme-
(a) allows for the reporting of complaints about the quality of broadband services (including faults and complaints about capacity to carry data or signalling) by registered subscribers, whether or not the subscribers are an end user for that service;
(b) places responsibility for every complaint or request with either the broadband service provider or the owner of the communication cable (depending on the nature of the complaint, fault or request), and ensures that in no case should a complaint, fault or request not be attached such responsibility;
(c) requires all repairs or alterations to the communication cables to be carried out in such a way as to accommodate and facilitate reasonably anticipated upgrades to the broadband and associated services;
(d) requires a broadband service provider or an owner or owners of the communication cables to carry out necessary repairs or upgrades to the same or a better standard than that pertained prior to the complaint or request.""
My Lords, I have taken over this amendment from the noble Lord, Lord Laird, because I originally wanted to table it myself but I was away at the time and could not get my e-mail to work from abroad, sadly, and could not get through to the Public Bill Office. The objective of this amendment is to try to strengthen the Government's hand in what they put through in Amendments 2 and 3, effectively, which is to put a duty on Ofcom to sort out a particular part of communications infrastructure which unfortunately has heavy underinvestment. The challenge that this amendment seeks to address is the lack of investment in maintaining the local loop, which is the part from the exchange to the customer, when it falls outside areas of high population density: in other words, rural areas and bits of towns which are not covered particularly well.
The problem arises because Openreach is a separate company but is also a subsidiary of BT, and it is responsible for the repairs and maintenance of this part of the infrastructure. Unfortunately, it suffers from severe financial constraints, not all of which are operational. For instance, there is a huge pension deficit in BT, which means that it has had to cut back on maintenance to a bare minimum. The trouble is that the average non-technical customer has real problems in continuing to receive the service for which they originally contracted their ISP. The ISPs have problems delivering it because they are finding that the lines are degrading. I have noticed that, the more I have said this in other fora, the more people join in and say, "Exactly; my line is getting worse and worse".
Let us say that you have got a fault on a line which has not been unbundled: in other words, it is still in BT's ownership. You are paying BT Retail for the line, and you are paying an ISP to provide you with broadband over that line. It gets a service from BT Wholesale, which runs what is called the backhaul from the exchange onto the main internet. Openreach is responsible for maintaining and fixing any faults on the line. There are four service entities involved, and there may be more. There are Chinese walls between these, and there is a lot of buck-passing. Let us say that your broadband is not working. You are meant to ring up your ISP, and tell it so. It is then allowed to test the line, and it may well use BT Retail stuff to do that, or it may be Openreach. Do not hold me to the exact detail of who owns which bit. BT Retail's universal service obligation only covers voice over copper, not the maintenance of broadband connections. So it will probably pass that test, but it is still not adequate for broadband, so it comes back and reports that the line is not faulty, but you know, empirically, that it is.
What do you do next? This is a challenge, because you cannot talk to BT Wholesale. The other thing that could be happening is that either BT Wholesale, or your ISP, could be throttling back your internet connection and reducing the speed on it because it has a lot of traffic, or they could be doing what they call traffic shaping, which is allowing only certain types of traffic through at full speed. This is done through a digital line management unit, which is connected to your digital subscriber line access management unit in the exchange. These are technical things, but they will not tell you if they are doing them. There is no way of finding out, so you are stuck. I have discovered, because my line fell to under half its speed over a four-year period, that, when this sort of thing happens, if you can pester people persistently over a six-month period, and you know something about it, and eventually your line fails completely, there are some excellent engineers at Openreach who can and will come and sort it out. My line is now nearly treble the speed it was a couple of months ago, so they can do it. There is not a real problem with the lines. The trouble is the underinvestment.
Amendment 9A has a couple of main points. The proposed new subsections 2(a) and 2(b) are supposed to deal with the problem of buck-passing, so that somebody is responsible for sorting out your fault. The next bit addresses the part of the problem whereby, because of the underinvestment and the fact that they are kept on a very short rein, whenever they come to repair your line, they will do the minimum possible to get it working to the minimum standard possible, because there is not much money. Therefore, they could be upgrading these lines when they replace stretches of line. They could be putting in 0.9mm copper instead of 0.5mm: but no, it will go in at 0.5mm, which tends to be universal. With broadband, we want to get better stuff in there, but they will not do that because it costs more money. That is why, under proposed new subsections 2(c) and 2(d), repairs would not be done at the bare minimum. Where possible, they should try to increase the capacity of those lines and improve them, and use that opportunity to steadily improve the network in distant rural points. This is supposed to be positive, and it would give Ofcom powers to put something together that might manage some of the problem. This will also require some co-operation and some financial sorting out, and some other things, but maybe it is a start. I beg to move.
My Lords, I did not plan to speak to this amendment but, speaking as a consumer of broadband services, it is quite an inspired amendment, whether or not the Government are sympathetic to it. It is exactly what Ofcom should be doing to allay the frustrations of consumers of broadband services, exactly in the way that the noble Earl, Lord Erroll, described. Many broadband users will have had exactly that experience, where you try to fix someone in this whole chain with responsibility, and wholly fail to do so. I hope that the Minister will be sympathetic, but even if he is not, I hope that Ofcom, when it gets a chance to read this debate, will know and understand some of the frustrations. This is not exceptional. This kind of example is very much a day-to-day situation.
My Lords, although consumer protection is a necessary and serious issue, I do not think this proposed new clause is needed, because the rights of consumers are extensively covered.
I will not reply to the technical nature of the contribution made by the noble Earl, Lord Erroll, because I do not think that would be an appropriate use of time. I understand the points that he made, having worked at some time in my life on some of that network. I want to address the underlying concern. Communications providers are required by Ofcom to establish procedures for handling complaints from consumers where they feel that they are not receiving adequate service. Failure to implement an adequate complaints procedure is actionable by Ofcom. I understand the point made by the noble Earl. It can be difficult for ordinary consumers to try to pinpoint where the blame lies and to get the appropriate action taken, but if it is not being handled correctly by the service providers, and if they have not got an adequate complaints procedure, that is actionable by Ofcom.
If the complaint cannot be resolved within the consumer complaint procedures, consumers are able to file an application with two independent alternative dispute resolution schemes. These are Otelo and CISAS, and do not ask me to explain those acronyms. These schemes can investigate the circumstances of a complaint and make a judgment that is binding on the provider, but not the consumer, who is always free to pursue separate legal action should satisfactory resolution not be possible.
Ofcom has also taken steps to promote competition and improve the incentives of providers to invest in and maintain broadband infrastructure, including by creating a competitive environment that allows investors who see a case for investing in networks to do so, and ensuring that consumers can make informed choices regarding services and providers, including publishing research on broadband speeds, which was one of the major concerns expressed by the noble Earl, Lord Erroll. The incentives provided by competition should help to eliminate poor service levels for consumers since they will be free, subject to any minimum contract term, to move to another provider offering higher levels of service. The UK has a healthy market for broadband provision, with a wide range of providers offering retail services. Complaints about the absence of supply were the reason for the Government's universal service commitment, which aims to deliver a minimum level of service at 2 megabits per second to virtually every community in the UK by 2012, including rural areas.
The amendment asks Ofcom to establish a scheme to deal with complaints, faults and requests regarding broadband and its associated data- and signal-carrying cables. Whatever the problems, getting Ofcom to handle this cannot be the right way. It would not even be the direct service provider. This would be a good example of extending the powers of Ofcom in a direction which would not solve the problem. There are some problems, and I understand the points which the noble Earl, Lord Erroll, and the noble Lord, Lord Clement-Jones, are making, but this is not the right solution. As I say, there are already facilities for consumers who want to complain, and Ofcom already has the power to take action if the complaints procedure is not adequate. In the light of that explanation, I urge the noble Earl to withdraw the amendment.
I thank the Minister for his reply. I just hope that the Government will think about this matter a little harder before it goes to another place, because something should be put into the Bill. Yes, you can complain to Otelo or CISAS about BT Retail or your ISP, who are your communication service providers, but the challenge is that you cannot talk to the very people who are responsible for doing something about it, who are Openreach or BT Wholesale. There is a complete disconnection between the two because of the Chinese walls that were set up for competitive reasons: to try to prevent BT from looking after its own. Unfortunately, the structure that has been set up does not work, and it will take someone else from outside-Ofcom is the only organisation that can do this-to realign the way in which the two work together. At that point, it should be able to stand back again.
What is happening at the moment is not working. It is too easy for people to pass the buck to each other. If you complain to Otelo or CISAS, BT Retail will say simply that it has done all that it can, and Otelo or CISAS will have to agree that it has. I am afraid that there is a problem here that needs to be addressed, and it would be nice if the Minister could think about this and if the Government could do something about it. My amendment in essence seeks to push things in the right direction. I probably should have tabled it at an earlier stage, but had not thought about the matter hard enough. With that, I beg leave to withdraw the amendment.
Amendment 9A withdrawn.
Moved by Lord Howard of Rising
10: Clause 2, page 2, line 32, leave out from "must" to "and" in line 33 and insert ", if requested to do so by the Secretary of State, prepare reports"
My Lords, Amendment 10 seeks to address in practical terms one of the major concerns that we on these Benches currently have with the balance of power between the regulator and the Government. The balance is weighted too far in favour of the regulator, and we would like it to be tilted more towards the Government. This can be done by establishing the right framework. Unfortunately, in this Bill, the Government seem to be happy to carry on as things are.
I have no doubt that these reports will be vital in assisting the Secretary of State in determining priorities for communications policies. There is no doubt that Ofcom is the body that should carry out such an assessment at arm's length from Ministers. However, I do not understand why the Minister's hands need to be tied by stipulating how often these reports are produced. The Secretary of State is missing a trick if he insists on defining the regularity of these reports so rigidly.
In many senses, it does not matter whether the report is every two years, as was originally suggested; every three years, as is now suggested; or every four years, as some, such as British Telecom, argue. It seems that the Government wanted to give ground on some issues but were not prepared to go the whole way, and as such they decided on the third suggestion as a halfway house.
More significant are government Amendments 13 and 14, which are welcome. It has always seemed obvious that any reports that are of significance should be placed in the public domain, and I am glad that the Government now agree. I beg to move.
My Lords, in Committee, a number of your Lordships had concerns about the frequency of the reports in Clause 2, which it was originally proposed would be every two years. The noble Lords, Lord Howard and Lord De Mauley, suggested then, as they have again today, that the reports should be prepared only at the request of the Secretary of State. The noble Lords, Lord Razzall and Lord Clement-Jones, suggested that four years would be more appropriate, and, during the robust debate that followed, the noble Lord, Lord Puttnam, very helpfully suggested a compromise position of three years as being more "appropriate and reasonable". As I recall, that suggestion was warmly received by the Committee.
In the light of that debate, the Government have considered this issue and now propose three-yearly reporting, which will be in line with the existing prescribed timetable for Ofcom to prepare other reports, for example the market reviews, and the review of the media ownership rules. I hope that this will reassure your Lordships that any burden on Ofcom or industry as a result of this reporting duty will be kept to the minimum.
I am speaking to the Government's amendment as well as addressing Amendment 10.
I suggest then that I speak to my amendment and not respond at this point to Amendment 10.
Why do we think that these reports should be produced regularly and not only when requested by the Secretary of State, as the noble Lord, Lord Howard, suggested? The point of this provision is to ensure that the condition of the nation's communications infrastructure is kept under constant review, and that not only are Ministers provided with regular information about it but their attention is regularly directed towards it. If a Secretary of State gets to the point where he feels that he needs a report on the condition of the communications infrastructure because of particular concerns, presumably there is something to worry about and it is already too late to take action to head off that concern.
Regular reports will ensure that Ministers have good, regular and consistent information that enables them to be well placed to take policy decisions that will place the UK at the top of the league table on communications infrastructure, instead of having to struggle to catch up, as we did with first-generation broadband and are in danger of having to do with high-speed broadband.
Finally, I reassure your Lordships that Ofcom will still be required to alert the Secretary of State to any significant developments in the sector that are likely to have a significant adverse impact on businesses or on the general public in between reports.
In Committee, the noble Lords, Lord Lucas and Lord Whitty, expressed a strong view, which was supported by others, that the reports that are prepared by Ofcom on the infrastructure and domain names and sent to the Secretary of State should be published. Our policy intention has always been that those reports will be published as soon as possible. Having considered the points that were made in Committee, we have concluded that for clarity it would be helpful to table a government amendment that requires the infrastructure reports in new Section 134A and the reports on internet domain names in new Section 134C of the Communications Act 2003 to be published by Ofcom.
As noble Lords will no doubt understand, commercially confidential information or information that should not be disclosed for other legitimate reasons-for example, law enforcement or personal privacy-should not be published. We therefore propose that Ofcom should not have to publish any material that would justifiably be withheld under the Freedom of Information Act.
My Lords, I apologise for disturbing the even flow of the Minister's speech, but I wanted the opportunity to intervene very briefly. First, we on these Benches strongly support the new government amendments. As the Minister said, we originally suggested a period of four years, but due to the masterly compromise suggested by the noble Lord, Lord Puttnam, we are very happy with the additional one year. I believe that industry will be happier with that rather longer period, since it was felt that having to report every two years was going to be unduly onerous.
I also want to put on record that we are strongly of the view that these reports must be prepared by Ofcom, and that it is not good enough to wait until the Government requisition a report from Ofcom. Therefore, we are not of the view that Amendment 10 is desirable.
My ability to rise promptly is a bit restricted these days. I have made the points against Amendment 10. We do not want unnecessary reports, and I hope in the light of the assurances that I gave in moving the amendments, that the noble Lord, Lord Howard, will feel capable of withdrawing his amendment.
I hope I am allowed to speak now. This nice piece of paper says a Member can speak when the Minister speaks early in order to assist the House in debate-that is obviously what he was doing. I beg leave to withdraw the amendment.
Amendment 10 withdrawn.
Amendments 11 to 13
Moved by Lord Young of Norwood Green
11: Clause 2, page 3, line 5, leave out "2" and insert "3"
12: Clause 2, page 3, line 7, leave out "2" and insert "3"
13: Clause 2, page 3, line 20, at end insert-
"(7) OFCOM must publish every report under this section-
(a) as soon as practicable after they send it to the Secretary of State, and
(b) in such manner as they consider appropriate for bringing it to the attention of persons who, in their opinion, are likely to have an interest in it.
(8) OFCOM may exclude information from a report when it is published under subsection (7) if they consider that it is information that they could refuse to disclose in response to a request under the Freedom of Information Act 2000."
Amendments 11 to 13 agreed.
Moved by Lord Whitty
13A: Clause 2, page 3, line 28, at end insert "giving due consideration to the interests of persons living in rural areas."
My Lords, I shall speak also to Amendment 13B. This part of the Bill deals with Ofcom's responsibility for spreading infrastructure, in the areas for which it is the regulator, across the whole of the nation. Whatever form of infrastructure we are talking about, it is common experience in rural areas of England, Wales, Scotland and Northern Ireland that the consumers, citizens and businesses that are located there have worse access, lower speeds in relation to broadband, more intermittency and generally a worse service than in urban and suburban areas. This applies not just to the remotest areas of Scotland, but also-I declare an interest in terms of my home address-in the borders of Dorset and Wiltshire. It is clear that if we are requiring Ofcom to report on progress in installing infrastructure in general, as this clause does, then the way in which we judge whether Ofcom has been successful-or Ofcom has judged the industry to be successful-must pay particular attention to the effect in rural areas.
In Committee, I was told that there was no need to spell out all the different potentially disadvantaged groups that Ofcom had to have regard to because that was written in Ofcom's basic constitution. I sort of accept that. I was also told there was no need to require Ofcom to report separately to the devolved Administrations, so that they can tackle problems that may arise in their particular areas, because Ofcom always does that. However, this is a specific and new reporting requirement. It is one required by this Bill and it is one to which reference was made in the first debate today on the new clause on Ofcom's responsibilities in relation to infrastructure. Whether you are talking about the changes in the effective operation of your mobile phone as you drive through the rural lanes of our country, whether you are talking about the speed of broadband or whether, equally importantly, you are talking about the ability to access public services and other information in rural areas digitally, then it is an important dimension of Ofcom fulfilling this responsibility that its reporting system should very specifically and very clearly cover the interests of rural consumers.
I am perfectly prepared to concede that the Government might have a better form of wording here. If anything, there probably should be a stronger form of wording. However, specific reference in the Bill to the rural areas in respect of this reporting mechanism is important. As distinct from one or two of my amendments later on, it ought to be a relatively easy amendment for the Government to accept. I beg to move.
My Lords, I have added my name to this amendment because I do think that this is a particularly important issue. I know the Minister addressed it briefly at the Committee stage so I went back and looked again at what has actually happened in a number of rural areas. People living in rural areas are not just another group. Because of the Government's quite correct drive to get more services online, it has become essential for those people to be able to access those online services, some of which time out if things take too long because they have only a dial-up mechanism. The same applies to online banking. With banks and other outlets such as post offices closing, online access becomes ever more important.
The Minister may say that other agencies-for example, the regional development agencies-should have been responsible. Indeed, in many cases they did take forward investment effectively. However, that has been patchy. It has not been equal across the regions. Economic and social development are being very adversely affected and this is the least the Government can do to rectify the situation. A long time ago-in fact when the noble Lord, Lord Whitty, was Defra Minister in this House-there was much talk of rural-proofing. This would be one of the main things the Government could do to rural-proof. Perhaps the Government still do a check on their Bills to make sure that they are rural-proofed. I should be interested to know whether this one has been. If it has, the Government should immediately accept the amendment.
My Lords, this is an opportunity for the Government to indulge in a bit of joined-up strategic thinking. The challenge comes because these universal service obligations, or measures of service, are always population-based, so that it skews it immediately towards the high density areas, such as cities with high-rise blocks. If we do not create the infrastructure out in remote areas, people will be forced to move. As happened in various other preceding great revolutions, such as the industrial revolution, you will see a steady migration of population to where they will have to move to in order to take part in modern society. What you could end up doing is creating more deprived areas. This sounds terrible, as if I am predicting apocalyptic things. I am not trying to do that. However, you will see a general deprivation starting to occur. People will then worry about that and want to address it, and suddenly you will have to put in much more investment and much more money. These things have a knock-on effect-once a few people start to migrate, there is less justification for the infrastructure; then more people migrate, and suddenly it becomes untenable to live there, except for very elderly or very young people who perhaps do not need access.
It could also be used for positive moves, such as trying strategically to repopulate the Highlands. Farming was never going to repopulate the Highlands, and trying to keep a few people there crofting certainly never did. You could have viable communities up there, but there is no way you could justify putting the infrastructure in if it was on a population-based system. So it may be worth forcing Ofcom to report in a more strategic way, looking at how we use land and resources effectively in the UK.
My Lords, the previous Labour Administration in Scotland started a scheme to extend broadband specifically to rural and remote areas. Let us be clear: there is a difference between a remote area, where only a handful of people may live, and a rural area, which could be a village in the middle of Oxfordshire, for example and have a population of 1,000 or 1,500. There may be sufficient demand in that area to ensure the exchange is upgraded to take broadband, even though it may still be down a copper wire. There is already a scheme in Scotland. It is having problems in extending out to the remoter areas of the Highlands and Islands, but it does go out to what one would term the "rural areas" of Scotland.
I support everything that has been said. In Ireland, where I live, a report for the Government recently suggested that, counterintuitively, it was more important to have good, high-speed broadband access in rural areas than in city centres. Such access has already affected the migration of quite a lot of useful employment back into rural areas-the Highlands and Islands in Scotland are a very good example. It is a useful amendment which offers a direction of travel for the Government.
My Lords, I absolutely agree with the objective of the amendment, which is to ensure that Ofcom considers in its reports the interests of persons living in rural areas. However, as I said in Committee, the amendment is unnecessary because the Communications Act 2003, taken with the provisions in this Bill, already require Ofcom to do just that.
In precise terms, the objective of the amendment is already achieved by Section 3(4)(l) of the Communications Act 2003, which requires Ofcom to have regard, when relevant, to the different interests of persons living in rural-I stress that-as well as in urban areas. When that is read together with new Clause 134B(1)(b), which requires the report to cover,
"the geographic coverage of the different UK networks",
I am sure that your Lordships will appreciate that the object of the amendment is achieved.
The clause talks of "geographic coverage" because there are sometimes circumstances where coverage may be problematic even in more urban areas, but as I am sure that the noble Lord, Lord Whitty, and the noble Baroness, Lady Miller, are well aware, the vast majority of areas where coverage of communications networks is an issue will be rural areas-or in some cases, as my noble friend Lord Maxton reminded us, it might be even more difficult for some of the more remote areas. That is precisely what paragraph (b) is intended to deal with.
In response to the noble Lord, Lord Puttnam, and the noble Earl, Lord Erroll, I say that we should remember that we are talking not just about the reports of Ofcom. I remind noble Lords that our report on Digital Britain made a specific commitment to ensure that all areas, including rural areas, have access to broadband of at least of 2 megabytes per second by 2012. That is not the end of the problems of universal broadband service, but it is a commitment to ensure a basic standard for everybody. If only we could ensure that providers delivered that, it would please the noble Earl, Lord Erroll, if no one else.
In response to the concern expressed by my noble friend Lord Whitty and the noble Baroness, Lady Miller, I say that the commitment is already in existing legislation, coupled with the new requirements. It is amply demonstrated also in our commitment to ensuring a universal broadband service. In the light of that, I hope that my noble friend will feel capable of withdrawing his amendment.
My Lords, I am somewhat disappointed by that, because I thought that I had already said that the pre-existing requirement on Ofcom to take rural consumers and businesses into account is clear. However, we are talking about a new reporting mechanism, which requires Ofcom to report, for example, on the proportion of the population covered by the different UK networks. The problem is, as the noble Earl, Lord Erroll, and others said, and others implied, that progress being made nationally conceals that the proportion covered in rural areas is less and, in some cases, going backwards. Unless that is specifically written into the reporting mechanism, the fact that Ofcom in its process-
I repeat my assurance. The requirement will correspond to the new reporting procedure. The procedure will not somehow stand alone; it will have to embrace that requirement to cover the rural areas. I am talking now about the new reporting procedure, so I wonder whether there is an unnecessary difference of opinion here. I am trying to give an explicit assurance that the new reporting procedures will cover rural areas.
My Lords, I can understand that, with all the reference back to the Communications Act and the original set-up of Ofcom, I may have missed something and may be slightly confused. I am therefore prepared to withdraw the amendment. It would be useful if, between now and Third Reading or before the Bill goes to the House of Commons, those of us who are concerned could be pointed to where the new reporting mechanism is clearly covered by existing provisions. I did not follow that from my noble friend's explanation; he undoubtedly has better briefing than me on this matter; but I should still like to see it in black and white. Subject to that, I beg leave to withdraw the amendment.
Amendment 13A withdrawn.
Amendment 13B not moved.
Moved by Lord Young of Norwood Green
14: Clause 2, page 4, line 35, at end insert-
"(3) OFCOM must publish every report under this section-
(a) as soon as practicable after they send it to the Secretary of State, and
(b) in such manner as they consider appropriate for bringing it to the attention of persons who, in their opinion, are likely to have an interest in it.
(4) OFCOM may exclude information from a report when it is published under subsection (3) if they consider that it is information that they could refuse to disclose in response to a request under the Freedom of Information Act 2000.""
Amendment 14 agreed.
Moved by Baroness Young of Old Scone
14A: Clause 2, page 4, line 35, at end insert-
"Reports on climate change
134D OFCOM reports on climate change
(1) OFCOM must, if directed to do so by the Secretary of State, require electronic communications networks and services providers to provide information on their preparedness for climate change.
(2) The type and format of the information to be collected by Ofcom from providers will be prescribed by the Secretary of State and will require:
(a) electronic communications providers to assess the risks from current and predicted climate change in relation to their functions,
(b) electronic communications providers to assess their preparations for a changing climate, including information on the steps taken to reduce or remove the risks referred to under subsection 2(b).
(3) Under section 134D, Ofcom are required to-
(a) request information from such networks and services providers as they consider appropriate, and
(b) send the required information to the Secretary of State as soon as practicable.""
I shall speak also to Amendment 14B. I should declare an interest as a member of the Climate Change Adaptation Sub-Committee. I apologise for raising this issue only on Report. Discussions with Ofcom and the department have been ongoing. I am grateful to the Minister's department for its engagement, but, having reached a point of impasse, I felt that I needed to bring forward the amendment.
Climate change will have an increasing impact on essential services in this country. Communication networks and services such as telecoms, the internet and broadcast media will be no exception. Perhaps I may give some examples: heat, floods and storms can knock out services, as can interruptions to power supplies. Transmission equipment can be jeopardised by stormy weather. In emergencies, communication services are vital not only for emergency response but for the public to gain information about what is happening during an emergency, as well as for the public to communicate with one another to gain reassurance about the safety and welfare of family and friends. During the Carlisle floods in 2005, when storms had brought down telecommunications and floods were increasing, Environment Agency staff nobly waded in and out of the local police station, itself underwater, simply in order to keep communications open and the emergency response services in action.
Just at the time when emergencies do arise, the public want to get more information about these emergencies in order to be able to respond to them. They also want to be able to communicate with their nearest and dearest, with their places of work and with emergency services. I believe that the public have a right to expect that the communications infrastructure and services will be planned to take proper account of the medium-term and longer-term implications of climate change and that communications companies should report from time to time on their preparedness for and resilience to climate change. My Amendments 14A and 14B seek to ensure that the communications companies do so.
This is not an off-the-wall, unusual request to the communications companies. Those of your Lordships who helped to steer through the Climate Change Act will recall that, under that Act, a variety of public and business bodies-for example, the water companies and the energy companies-are required to report on their preparedness and their adaptation to the impact of climate change. The communications companies were not included in that group, I think by mistake rather than by design. The water companies, the energy companies and others classed as statutory undertakers are required to report. Of course the communications companies do not fall into the category of statutory undertakers, but they are, as I am sure your Lordships would agree, just as important to this country's resilience to the impact of climate change.
Amendment 14A tries to correct what I believe is the erroneous omission of the communications companies from the Climate Change Act reporting requirement by asking Ofcom to seek reports from such companies, whose resilience to floods, heatwaves and storms is important. The Secretary of State will prescribe what information he needs to know, so Ofcom is not required to become an expert in climate change impacts and their adaptation. The proposal would not cover all the companies regulated by Ofcom but would leave Ofcom to judge which companies are the most important in terms of resilience to climate change impact.
Amendment 14B would enable Ofcom to use its existing information-gathering powers to require communications providers to supply the information required and would ensure that Ofcom could not just ask willy-nilly for excessive information. It makes it clear that the power would be subject to the restrictions in Section 132 of the Communications Act 2003, which says that demands for information must be proportionate.
I am absolutely certain that the Minister will resist this amendment, although I do not believe that that is because the Government do not want communications companies to have to report on whether they are resilient in the face of climate change. I believe that the Government want that; indeed, in response to the consultation about Ofcom's powers, they confirmed that they believed that the industry should plan for the resilience challenges posed by climate change. The disagreement is really about how that can be achieved. In the discussions that have been taking place, the Government have proposed that these issues be addressed later, in the wider context of the new security and resilience requirements that arise as a result of the recent review of the EU telecoms framework legislation. The revision to this framework directive has only just been published. The timescale for transposition is unclear and, although I would hesitate to accuse the Government of fiddling while the UK floods, it feels a bit like that.
The Minister has meanwhile proposed a voluntary arrangement of the key players in the sector, which might be in place by the autumn. I believe that this is too important an issue to be left to a voluntary agreement with the industry to provide some unspecified information from unknown companies at some possible future date. Wisely, the Government have not accepted a voluntary approach with other key industries, so I do not believe that they should accept it with the electronic communications industry, which is vital to emergency resilience and the work of other parts of the critical national infrastructure.
This may be the wrong amendment. If it is, there are perhaps other ways in which the Government can give assurance on these points. Clause 2 of this Bill, which amends the Communications Act 2003, requires Ofcom to prepare reports on electronic communications networks and services matters, including preparations made by providers for responding to an emergency, the steps taken to assess the risks of different types of emergency and the steps taken to reduce those risks. Perhaps the Government might give guidance to Ofcom to ensure that the definition of an emergency includes not just immediate emergencies and resilience envisaged by the clause, but also the very likely medium-term causes of future emergencies such as the impacts of climate change. It should also include the risk assessment and resilience measures to be put in place by the communications networks and services to meet not just these immediate risks but the medium-term and longer-term climate change impacts. That piece of guidance to Ofcom might strengthen the position.
The ideal situation would be if the Government were to ponder on this amendment and bring forward one of their own, either at a later stage in this House or in another place. At the very minimum I ask the Minister to give assurances to noble Lords, and indeed to the public, that these vital communications companies will ensure that they are resilient to the impacts of climate change and that they will be required to report on that resilience, as the majority of other organisations and companies important to national climate change adaptation and resilience already have to do by law. I beg to move.
My Lords, we support in principle the amendments put forward by the noble Baroness. Indeed, it would be very strange if we did not support the amendments from these Benches. The noble Baroness has clearly spotted a gap in the Climate Change Act, which could be filled by this amendment. The Government are suggesting a voluntary agreement; I am not quite sure why-it is not entirely clear-but I urge them to take seriously what the noble Baroness, with all her experience in this area, is putting forward. These seem to be sensible suggestions and I very much hope that the Government will look seriously at either accepting the amendments or giving them further consideration as the Bill progresses.
My Lords, since Committee the Minister has been kind enough to write to a number of us about the matters raised by the RUSI report into the resilience of the communications networks, particularly first emergency responders and local authorities. The report pointed out many of the gaps. The Minister said in his letter that those were largely organisational gaps, but when I went back to the report I saw that the issue is a bit more far-reaching than that. I am grateful to the noble Baroness, Lady Young of Old Scone, for raising this issue, because I am little bit shocked that, as we worked our way through the Climate Change Bill in this House, we did not question the role of communications networks. It seems that, of all the statutory undertakers, those in charge of communications are right at the front line.
I, too, hope that the Government will be able to do more than say that they will put this back until they have something to transpose from the directive, because between now and then there are likely to be, on the basis of the last year or two, many more floods and many more weather emergencies. Nobody has better experience of these things, I would suggest, than the noble Baroness, who was of course in charge of the Environment Agency as the water was rising up towards that electricity substation. She has particular experience of exactly how fast these things can happen.
My Lords, I declare an interest as both a member of the board of the Environment Agency and a member of the Joint Committee chaired by the noble Lord, Lord Puttnam, who is no longer in his place, that carried out the pre-legislative scrutiny of the Climate Change Bill. It was clearly a fault of those who were scrutinising the Climate Change Bill that this issue was not included. Communications are absolutely vital not only in responding to the acute situation of an emergency caused by changes in weather conditions but in future-proofing the systems in terms of expected changes in temperature, soil composition as a result and so on. I hope that, even if the Minister does not completely accept the amendment moved by the noble Baroness-I nearly said "noble friend", as she was once-the Government will accept that Ofcom should take on an equivalent function to the ones that Ofwat and Ofgem have in planning for resilience in the face of climate change. Whether or not that is done in this precise form, an indication from the Government tonight would be helpful.
My Lords, I am grateful to the noble Baroness, Lady Young, for introducing the amendment in a largely constructive way, although she referred to an "impasse", which is not quite the word that I would have used. I hope that I can reassure her that, far from there being deadlock, the Government are extremely constructive and anxious on this matter.
I am grateful to other noble Lords who have participated in the debate for stressing the importance of resilience in the telecoms network. The Government regard resilience to the risks caused by climate change as being of the utmost importance. That is why the Bill introduces a requirement for Ofcom to provide a triennial report to the Secretary of State on electronic communication infrastructure and its resilience. That refers to overall resilience, but we are concerned about a high level of resilience for the UK telecoms networks. Climate change is, of course, significant, but we also need resilience to risks such as loss of infrastructure through malicious or terrorist attack, human error, accident, force majeure or whatever. By its very nature, that will include natural events or disasters, whether or not they are caused by climate change.
The noble Baroness, with her vast experience in her role in the Environment Agency, will know only too well that the Government have already acted on the issue of resilience. Following the Pitt review on flooding, a voluntary industry work programme to enhance resilience was put in place. That work has been going on for a considerable time. As she also knows, we also have the Flood and Water Management Bill, which we will have the greatest pleasure in debating in Committee in a couple of weeks-indeed, I gave an assurance at Second Reading that we would be considering these matters in some detail.
The necessary resilience of our telecoms network is of great importance. Far from the Government being obstructive, we are greatly exercised, not just through the promptings of the noble Baroness but because of the views of others who are concerned about climate change. We are concerned about resilience and we are taking action.
It is important to consider resilience as widely as possible. I do not want to risk detracting from all the existing work to enhance resilience to other risks by introducing different sets of reporting requirements on different risks. At this late stage it would also be unwise to include further onerous blanket requirements across the entire sector when we have not consulted it on that. There is a requirement on Ofcom to report on and play its part in guaranteeing effective overall resilience to any threat to our system. In the report to Parliament, Adapting to Climate Change: Ensuring Progress in Key Sectors-2009 Strategy for Exercising Adaptation Reporting Power and List of Priority Reporting Authorities, published in November 2009, the Government committed themselves to engaging with industry on climate change adaptation. Discussions have been taking place with Ofcom on how to achieve a voluntary way forward on reporting on climate change adaptation matters.
Once we have a clear view on the impacts of climate change on the telecoms sector, we can explore with Ofcom how this can be incorporated within its triennial reports on resilience, to which I referred a few moments ago. Ultimately, should the impacts of climate change present a risk to the telecoms networks, reporting requirements on overall resilience are bound to reflect this, alongside all other risks that are of great moment. Creating a separate reporting requirement is not the most effective way of getting the industry to play its full part in mitigating the risks and tackling the problems.
We know that the telecoms sector takes resilience extremely seriously. After all, it is in its interests to ensure resilience to challenges that climate change may present in the same way as it does in relation to other risks. Providers voluntarily offer high levels of resilience through an all-hazards approach that is achieved through ongoing dialogue and close co-operation. This reporting requirement would undermine that overall approach that the House will appreciate we need. There are no data available demonstrating how the telecoms sector is at risk from climate change. To mitigate vulnerability we need further discussion and analysis with the industry, taking data into consideration. To create a new legislative reporting requirement would run counter to the light-touch legislation by which the sector is currently regulated. It would at the same time detract from the comprehensive approach to risk that it is in the industry's interests to address and which the Government are pursuing vigorously.
I make the obvious point that, if the Committee on Climate Change wants to pursue these issues further in detail, of course the Government will respond constructively, but a comprehensive approach on resilience is necessary. I have said how the Government and the industry respond when a potential threat occurs. We have already seen that in the context of the response to the floods since 2007.
Although this Bill is largely the concern of the Department for Business, Innovation and Skills, which has real concerns about how regulation is enforced and developed with the industry, and although the DCMS inevitably has a great interest in many aspects of the Bill, I emphasise to the noble Baroness-I speak as one of the team of Defra Ministers-that the Secretary of State has taken a particular interest in this issue. He is all too well seized of the importance of climate change in relation to the telecoms industry, but it is not his view, nor the view of Defra as a whole, that this amendment and this specific form of reporting is necessary or desirable.
I therefore hope that the noble Baroness will withdraw her amendment. She has certainly presented an important case, but I hope that she will accept the assurances that the Government take the case seriously and are already addressing these issues, albeit in a different way from the one that the amendment enjoins. We believe that the amendment would somewhat frustrate the total picture that the Government are seeking to establish.
I thank the Minister for his answer, which was reassuring in some respects but not reassuring in others. I also thank the noble Lords, Lord Clement-Jones and Lord Whitty, and the noble Baroness, Lady Miller of Chilthorne Domer, for their support for the amendment.
I am glad that the Minister has indicated that the Government are taking this issue seriously, because it is a serious issue. However, I am a bit bemused by the idea that somehow requiring the communications companies to report would undermine the general approach that the Government are taking. It may undermine the general approach that the Government are taking to the regulation of the communications sector, but it seems to me that it would bring the communications sector entirely into line with the requirement by law to report on climate change adaptation that has been laid on all the other sectors that are important in national resilience. That does not therefore seem to me to be a killer blow to the amendment. If it is sauce for all the other geese, why is it not sauce for this particular gander?
Waiting for a clearer view on what the climate change impacts on the communications industries might be before deciding what to include in the triennial reports is probably a longer process than is necessary. As I said, all other sectors are required to report without the work on impacts necessarily having been gone through in detail. The whole point is to get the sectors to think for themselves about the impact of climate change on the resilience of their businesses and their services to the public and to get them to report back on their risk assessments and what they are doing about them. Spoon-feeding the communications industry in this respect seems to be out of line with the requirements that are laid on all the other sectors.
I am pleased that the Minister is saying that the triennial reports on resilience that Ofcom must provide will include the future long-term impacts of climate change, not just the immediate short-term definition of what an emergency is. However, that is not a view that Ofcom currently shares, so I will take up his invitation to come back at a later stage of our consideration of this Bill to establish why there seems to be a difference of view between the Minister and Ofcom about what these reports will legitimately cover. I beg leave to withdraw the amendment.
Amendment 14A withdrawn.
Amendment 14B not moved.
Moved by Lord Lucas
15: Before Clause 4, insert the following new Clause-
"Disclosure of information
An internet service provider may not disclose information which enables a subscriber to be identified to a copyright owner unless it is satisfied-
(a) that the process used by the copyright owner to procure evidence on online copyright infringement is legal and accurate, and that it has been appropriately employed;
(b) a court is so satisfied; or
(c) OFCOM is so satisfied."
My Lords, in moving Amendment 15, I shall speak at the same time to Amendment 31. The Minister knows what this is about; we talked about it extensively in Committee. It seems to me that now is the time to take all the good intentions expressed all the way round the House and reach some sort of conclusion.
The purpose of this bit of the Bill, which we are just coming to, is to produce a sensible and civilised way whereby copyright owners can effectively enforce their copyright in a situation where the theft of copyright material has got seriously out of hand. We have made a lot of progress in this Bill, and with the amendments which the Government will bring forward, to produce that effect-something which will start off by being educative, and which will be punitive only after very reasonable procedures have been gone through. I hope very much that it will be effective.
Unfortunately, there have sprung up what I would describe as abuses. They may not technically be abuses, but they are certainly abuses of current practice so far as the citizens subject to them are concerned.
The game works roughly like this. You find an owner of an obscure bit of copyright that is available on the internet, preferably something pornographic and extremely nasty. You then employ a piece of software whose innards have never been exposed to the public, or tested in a court, to produce allegations that a particular set of IP addresses have made that copyright material available for upload over the internet. You then take tens of thousand of these cases to court and, using a Norwich Pharmacal order, obtain the details of the relevant subscribers from their internet service providers. You then write them a letter, which has basically three elements to it. First, it says: "You have committed this transgression of copyright". Secondly, it says: "If you force us to take you to court, we will pursue you for a very large sum of money". Thirdly, it says: "But we offer you this opportunity to settle for a mere £500 or £800"-or whatever the figure is-"and we will forget all about the perils of court and the vast sums for which you might otherwise be liable, because basically we are very good people, and all that we are seeking to do is to protect our copyright".
This scam works because of the impossibility of producing proof against this allegation. How can you prove that you did not do this thing? You have an internet connection, and they say that it was done over that internet connection. It is no good producing your computer, because you committed the offence using a different computer. It is no good saying that you are a 97 year-old widow and that you hardly know how to use the telephone, let alone the internet, because, nevertheless, you have an internet connection and they say that it was abused. It is extremely difficult to produce evidence to gainsay this. All you can do is deny it, and one of the things that they say in the letter is, "Don't bother to deny this without producing evidence that you didn't do it".
The result is that a very large people of number pay up, as a result either of the first letter or of the letters that follow. As far as I can discover, despite the tens of thousands of orders that have been granted, the solicitors involved have never taken a seriously contested case to court, because getting money out of people on the basis of the compromise offer is actually what is lucrative.
There may or may not be truth at the root of this, but this is a route for obtaining redress for copyright abuse which has been neglected, and with good reason, by the reputable end of the copyright industry. It produces a great deal of distress and indignation among many thousands of our citizens, and it ought not to be allowed to continue now that we are producing a better and proper route for redress for copyright owners, particularly where we are looking at volume cases-where we are looking at large volumes of infringement. That is exactly what the Bill aims to deal with.
My Amendments 15 and 31 look at a couple of possible ways of dealing with this. We could act on the internet service providers and give them a defence against revealing the details of their subscribers-we could say that either they or a court must be satisfied that a fair and accurate process was being used-or we could give the court the power to say, "No, here is this Act which provides a proper remedy for copyright owners who are suffering from the sort of abuse which is alleged in these letters. Let them use that route because that is fairer for consumers and a fairer basis on which to operate, which is what Parliament has decided, and lay off the techniques which are being used to extract money at present".
Mostly, to date, one firm has been involved, but now a second firm is getting involved. The news of how lucrative this is has spread. If we do not do something about it, we will have more firms creeping into this business. There is plenty of copyright in unpleasant material. There are plenty of opportunities for these firms to make money. It is high time that we do something effective to put a stop to it. I do not mind which of the amendments the Government choose. I suspect that if I was forced to choose between them, I would choose the one put forward by the Liberal Democrats. It might not be perfectly drafted, but if we get it into the Bill now, the Government will have an opportunity to redraft it for Third Reading. But this must not be allowed to continue. I beg to move.
My Lords, I shall speak to Amendment 16, which is grouped with the amendments tabled by the noble Lord, Lord Lucas. There are many ways to skin a cat. Our amendment is aimed at solving the problem to which the noble Lord referred. In Committee, we discussed this matter. From the letters that noble Lords on all sides of the House have received, it is apparent that there is a problem with the activities of one particular law firm. As the noble Lord, Lord Lucas, said, we think that now two law firms are involved. I am very grateful to Which? for drawing to our attention, apart from the letters that we have received, the problems of which it is aware.
The Minister has been helpful in circulating to all of us the information that he has received from the Law Society's regulatory body. This information indicates that the society is very alert to the practices of the law firms in question, as referred to by the noble Lord, Lord Lucas. There is a debate as to which of the approaches-the approach of the noble Lord, Lord Lucas, or ours-is the correct way of dealing with this. He is right that this gives the Minister the opportunity to get into the Bill something that can deal with the matter.
Perhaps I may put into one sentence-when people say that, they usually go on to speak for five minutes-what I feel is the view on these Benches. As noble Lords will have realised, I have always been hugely sympathetic to the interests of the creative industries. I completely buy the argument that we cannot allow our creative industries to suffer from the illegal downloading of material. However, the creative industries have spent a large number of years trying to get their act together in relation to what they want the Government to do. They have eventually arrived at that point, and we now have the proposals for the code and the technical measures. However, the creative industries cannot have it both ways. They cannot have the huge amount of effort which Ofcom, the Government and everyone else will be putting into getting the technical measures into place-let alone the costs which will be incurred both by the ISPs and by themselves-while at the same time saying, "But we also want to reserve the right to send letters to people through our lawyers saying that if they do not pay their £500, there will be frightful consequences". Under this amendment, if the copyright owner believes that there is a breach, it will have to go through the technical measures rather than go to court.
My Lords, the House is greatly indebted to the noble Lord, Lord Lucas, for tabling a number of amendments in Committee to which the Government have now responded. However, I wonder whether he does not feel that, on reflection, and on a close reading, government Amendment 100 largely deals with all the problems that he has raised, including the prospect of costs being awarded to the subscriber. That should be a sufficient deterrent to rogue firms of solicitors who try to make a quick buck by writing threatening letters.
The Government have given every evidence of having listened to everything that the noble Lord, Lord Lucas, said in Committee, and with which I largely agreed. The balance was too heavily tilted in favour of the copyright owners. However, that balance has been addressed by the Government's later amendments. I am not sure that I see the point of looking for something extra at this point.
I greatly support the sentiments behind these amendments. Although I take the noble Lord's point that Amendment 100 addresses this issue, it deals with it only in the context of a letter that has been raised within the confines of the Bill. The point being made by the noble Lord, Lord Lucas, is that law firms and others could continue to send letters which are nowhere within the ambit of the Bill and which are not controlled under it. So they can put whatever they want into those letters. They could even refer to the letter in a way that would give the illusion that this legislation is involved.
This may sound like a different point, but it is not. When we had the confusion over people asking for information about subscribers' telephone details, we ended up having the Regulation of Investigatory Powers Act to try to consolidate the position. People did not know whether requests were genuine. It would be a big loophole if we left in the Bill a system that could give rise to abuse. We now have a chance to knock this on the head once and for all. Then we can do everything in a proper and consolidated way, and we will know where we stand.
My Lords, I was going to make a similar point. We have concerning evidence, as we all said in Committee, that one and now apparently two so-called solicitors are behaving in this way. Clearly this has to cease. Equally, there has recently been legislation and the establishment of new bodies which are just coming into effect. I am less keen to put something into the Bill immediately, as it will not necessarily be the right answer to the problem. I am a little more cautious about it at this stage. It has to be dealt with and is disgraceful. If these firms really are law firms, they are bringing their whole profession into disrepute.
My Lords, the Government would be wise to take on board a provision such as this one if they want their other measures to receive a degree of acceptance if not enthusiasm. As my noble friend the Minister knows, I am deeply sceptical about the approach of this Bill. One of the reasons for that scepticism-and one of the reasons detected by the rather small group of consumers who actually understand these things-is an awareness of these kinds of abuses being committed under the present system by the rights holders who to go to court and, even more diabolically, by some of their legal representatives. Acceptance of the future system proposed in the Bill would be aided if these abuses were cleared out of the existing system.
With due respect to my noble friend Lord Gordon, Amendment 100-with which there will be some difficulties anyway-does not address this issue because it is a post facto situation involving someone who has gone through the technical measures and procedures in the Bill. The abuse addressed in the amendment put forward by the noble Lord, Lord Lucas, involves the present system of going through the courts. That has given some rights holders and their representatives a pretty poor reputation among those who ought to be enthusiastic consumers of their output. This has in part soured discussion about the objective the Government are trying to achieve in the Bill. I hope that one of these amendments appeals to the Government-it ought to. If not, the Government ought to come up with one that deals with this very serious abuse once and for all.
On these Benches we are very pleased to see that the House is generally much more sympathetic to amendments of this nature. Obviously, they have been redrafted to be less exclusive in terms of ousting the courts, but as the Minister himself in his letter to us said:
"There will be occasions where the notification system is not appropriate, and it is important that we allow rights holders some flexibility, rather than tie the hands of the entire creative industries due to the possible poor conduct of some isolated parties".
We took that on board in formulating these amendments. Clearly, we are very strong supporters of the system of graduated response, which as the noble Lord, Lord Lucas, said is being considerably improved as a result of amendments to the Bill. However, in the meantime we learn of new entrants to the hall of infamy, such as Tilly Bailey & Irvine-the second law firm which I do not think anybody has mentioned in addition to ACS:Law. We also know more about the firm responsible for the investigations, Logistep. As my noble friend mentioned, the activities of these two law firms and Logistep are an embarrassment to the rest of the creative rights industry. We have seen more letters since Committee stage which demonstrate the methods being used by these law firms, which are of a threatening nature-some six or so pages as a first letter is grossly disproportionate.
"We appreciate the impact that receiving letters from ACS:Law is having on individuals, and the need to bring this matter to a conclusion as soon as we are able. However, we have to undertake a thorough investigation to ensure the right outcome in the public interest".
It has assured several noble Lords that it will keep us informed of progress.
With respect, I mention to the noble Lord, Lord Gordon, that Amendment 100, which he talked about, is on a wholly separate issue-appeals against technical measures-and does not cover the matter in hand.
We are pleased that the SRA has said that it will deal with this with dispatch. However, we feel something in the order of the amendments tabled by the noble Lord, Lord Lucas, or those in the name of my noble friend and myself is necessary to remedy this. It is a considerable problem for many people up and down the country and will remain so unless we make sure that the code almost invariably applies in the first instance.
My Lords, I rise very briefly. We sympathise a great deal with much of what has been said, but it is an important point of principle that nothing that is put in the Bill prevents rights holders from using civil proceedings.
The initial obligations procedure in this legislation is an additional remedy designed to tackle illegal peer-to-peer file-sharing. That point of principle is important when discussing and looking at these amendments. Amendments 16 and 31 would appear to limit the ability of a rights holder to use established remedies. If rights holders want to go to court to seek damages under existing copyright laws, then this Bill should not stop them from so doing.
On these Benches we obviously agree with the aim of stopping unscrupulous law firms sending demanding letters to unknowing and innocent customers. However, I am not sure whether the way to stop these is to stop rights holders being able to exercise their legitimate claims in a timely manner.
Finally on this issue, I thank the Minister for taking this matter up with the Secretary of State for Justice. While I appreciate that he will not wish to comment before the individual cases are resolved, can he give the House an update on discussion with his government colleagues about alternative means by which help can be given to protect consumers?
My Lords, as I have expressed on previous occasions, I sympathise with the concerns-there is nothing between us on the problem. I understand the intent behind these amendments. Though I did not initially receive the letters I am sure I am being included in the loop; I get the letters now. I share the concern: I would liken them to rogue wheel-clampers, if I can use that analogy.
There are certainly some law firms which appear to act in a way that some consider heavy-handed or unfair. However, the proper way to control the conduct of law firms is through the independent regulator, and that is what we are doing. Following discussion of this matter in Committee, we wrote to the Lord Chancellor, as has been heard, to bring this matter to his personal attention. As you know, we have received a reply from the Ministry of Justice, and a further letter from the Solicitors Regulation Authority. These letters explain that there have been complaints and a thorough investigation is under way. Like all noble Lords, I wish it could act more promptly and we could bring this to an end.
It is fair to say that we expect that copyright owners will want to use this notification system to tackle appropriate cases. Indeed, should the Bill become an Act, the courts may choose to view the approach taken within it as an example of good practice for cases of this sort-although clearly this would be for the judiciary to decide.
We believe that the notification system is fair and proportionate, and we hope that it will be effective. However, we do not believe it is right to remove flexibility from the courts and copyright owners in the way these amendments seek to. There will be occasions, as my noble-I nearly said friend-the noble Lord, Lord Howard, quite rightly pointed out, when the notification system is just not appropriate, and there is no justification for adding extra difficulty to those cases. I remind noble Lords that the graduated approach which we seem to accept as the right way forward was really designed to deal with the mass problems of peer-to-peer file-sharing. That is why we talked about behavioural change, and why that was appropriate. However, in certain cases this is not appropriate-for example, where people are stealing or infringing high-value copyright, or where there is a need for action to be taken more promptly-then, as the noble Lord, Lord Howard, said, we cannot deny copyright holders an alternative approach. This notification system will not be appropriate, and there is no justification for adding extra difficulty to those cases.
The right to access the courts is a fundamental one, and to limit this in any way may infringe upon basic human rights, as well as on the free exercise of the property right in copyright itself. It is not that we do not want to be of assistance-we want to help. However, going down the route suggested in these amendments unfortunately will not solve the problem.
I will rest on this final point, which is another reason why we cannot accept the amendments however much we sympathise with their aim. The right to take action against a person who has infringed your copyright is enshrined in international and European law. There is also a more fundamental question here: the right of access to the courts and access to redress for a civil wrong. Human rights are engaged, as well as matters of constitutional law. This is a matter that needs to be solved through regulation, not by interfering in these basic rights. It is not that we do not have a great deal of sympathy. In a way, we wish that we could do this. Unfortunately, however, the suggested remedies are not capable of being introduced, and they are not appropriate for the reasons that I have mentioned.
I hope the noble Lord will recognise that we have treated this matter seriously and that we will continue to do so. We will continue to press the Ministry of Justice and the Solicitors Regulation Authority to act on this. In the light of the points I have made, I hope he will feel capable of withdrawing the amendment.
My Lords, as the Minister pointed out when he referred to rogue wheel-clampers, it seems to take a very long time and the suffering of tens of thousands of people before a Government will move to deal with an abuse that has some justification in fundamental law. Rogue wheel-clampers are merely enforcing their rights of private property. I suppose that bailiffs are doing an excellent job in retrieving lots of money for the public purse and for creditors. Here we have another case where many tens of thousands of people are subject to something that is not as we would wish it to be in a proper and perfect world.
I appreciate what the Minister said about there being deeper questions here, and I understand that my own Front Bench shares those qualms. Other than an expression of sympathy, I would like to hear an expression of the determination to deal with this question if it continues or gets any worse. It would be immensely helpful to hear that from the Government and to know that this is not a permanent disfigurement on the face of copyright law and practice. If the SRA cannot deal with it, we will find some other way of dealing with it ourselves. It would be a great comfort to know that that was the Government's position.
Perhaps I can be of help. We will continue to pursue this problem with the Ministry of Justice and the SRA. I give that assurance because we share the concerns that this problem does not look as though it will go away even if the Bill is enacted. I can give that assurance, if it helps the noble Lord.
My Lords, that is appreciated. I am sure that my noble friend on the Front Bench also shares those sentiments, but I will not press him to go outside the rules of Report. With grateful thanks, I beg leave to withdraw the amendment.
Amendment 15 withdrawn.
Amendment 16 not moved.
Consideration on Report adjourned until not before 8.44 pm.