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Deregulation Bill — Report (2nd Day)

– in the House of Lords at 12:15 pm on 5th February 2015.

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Votes in this debate

Clause 64: TV licensing: alternatives to criminal sanctions

Amendment 27

Moved by Baroness Howe of Idlicote

27: Clause 64, page 57, line 43, at end insert—

“(14) Any regulations which are made under subsection (1) shall not take effect before 1 April 2017.”

Photo of Baroness Howe of Idlicote Baroness Howe of Idlicote Crossbench 12:29 pm, 5th February 2015

My Lords, our amendment to Clause 64 seeks reassurance that any potential changes to the licence fee enforcement system will not take effect until at least 1 April 2017. This necessary amendment ensures that any impact on the BBC’s income from the licence fee is thoroughly considered before any action is taken.

The reason why 1 April 2017 is vitally important is because this is when the current licence fee settlement expires. Under the current settlement, the BBC has been able to plan its programme-making years in advance and to budget accordingly. Thus any changes to the licence fee enforcement regime coming into effect before 1 April 2017 would have a significant impact on the service and content that the BBC provides. The BBC needs sufficient time to respond to a change in income or else drastic action, such as service closures or the loss of programmes, could be a serious possibility.

Our amendment ensures financial stability for the BBC so that it can continue long-term commitments. From 2014 until 2018, the BBC is marking the First World War centenary with its biggest and most ambitious pan-BBC season ever undertaken. Unique in scale and breadth, and across BBC TV, radio, online and international, national and local services, this commitment is possible only because of licence fee funding and an assurance of income. “Frozen Planet”, “Africa” and “Planet Earth” are all examples of the brilliant factual programmes produced by the BBC’s natural history unit, all of which took four years to make. Quality dramas such as “Wolf Hall” and the upcoming “War and Peace”, also typically take around four years to produce. There is also the current “Taking Liberties—The Democracy Season”—years in the making—marking the anniversaries of the first Parliament and Magna Carta. It is seasons and programmes such as these which highlight graphically why the timing of any potential change is crucial.

The Government made a commitment to the BBC when the current licence fee settlement was signed in 2010,

“to provide a full financial settlement to the end of the year 2016/17, with no new financial requirements or fresh obligations of any kind being placed on the BBC and/or licence fee revenues in this period”.

Our amendment to Clause 64 safeguards this undertaking. As I have already said, the BBC has carried out forward planning under this commitment. Clause 64 will enable the government of the day to act upon the conclusion of the licence fee enforcement review currently being conducted by David Perry QC and due to report in June 2015. The BBC, I know, looks forward to engaging with the review. Its overriding concern will be to ensure a licence fee enforcement system that is both proportionate and successful in maintaining the current low levels of evasion and collection costs. Currently, the licence fee evasion rate is low, at around 5.5%. If licence fee enforcement were purely a civil matter and the evasion rate were to increase to that of utility bills, which is just under 10%, that would cost the BBC around £20 million per annum.

The conclusions of the review by David Perry QC of licence fee enforcement should be considered in the round as part of the upcoming charter review. This is a commonsense approach which would consider the interests of all those who would be affected and of course would include licence fee payers. Our amendment, which I should have said at the beginning has strong cross-party support, provides certainty for the BBC’s budgets and planning until the next funding settlement begins in April 2017.

The BBC is a vitally important, well-loved national institution and, as often referred to in this House and the other place, is the envy of countries around the world for its trusted and independent news output and the quality drama and children’s programming it produces. Why risk losing that or damaging our much-loved programmes and services? I hope that noble Lords will agree. I beg to move.

Photo of Baroness Corston Baroness Corston Labour

My Lords, I rise with reluctance to oppose the amendment moved by the noble Baroness, Lady Howe of Idlicote. I yield to no one in my support of the British Broadcasting Corporation. We are extraordinarily fortunate to have such an institution in this country. One has only to go to the United States of America to see television where there are hundreds of channels but nothing to watch to know how lucky we are to have the BBC. However, I take issue with the criminalisation of a failure to pay the fee.

Whenever I meet women in prison who are there because they did not pay the fine, I get a message from TV Licensing, which is based in Bristol where my old constituency was, saying, “Oh well, not paying the television licence fee is not a crime”. Of course it is not. What happens is that these people, usually poor women, are taken to court where they plead guilty. Some have said to me, “I left the television on because the kids said that the other children at school were talking about programmes they did not know about”, but they could not afford the £145.50 a year it costs to pay for the licence. If it was a civil penalty, of course there would be a fine, and other things like distraint can be used against those who do not pay a fine arising from a civil penalty.

I know that 50 people a year are imprisoned because they do not pay the television licence fee. They are not imprisoned if they do not pay their council tax, but local authorities seem to survive. I once met a woman who had been imprisoned for three months for failing to pay the £145.50 television licence fee and a £200 fine. If she could not afford the licence fee, surely she was not going to be able to afford a £200 fine as well. During those three months in prison she lost her tenancy and was unable to look after her children, who were taken into care. When she came out of prison, she was told that she could not have local authority accommodation for a family because she did not have her children with her, and when she went to social services she was told that she could not have her children back because she did not have family accommodation. That is a Catch-22.

Photo of Lord Berkeley of Knighton Lord Berkeley of Knighton Crossbench

I am grateful to the noble Baroness for giving way. I have just one simple question. I do not think that this amendment is about decriminalisation, it is simply about timing and budgets. The Government have often said that business and arts institutions need to know what lies ahead in terms of budgeting. It may well be that decriminalisation should happen, but as I understand it, that is not what this amendment is about.

Photo of Baroness Corston Baroness Corston Labour

The amendment is about the fact that the status quo remains until the renewal of the charter in 2017. I am merely flagging up the point that we should not allow continuing criminalisation in respect of this penalty, because of the malign effect it has on, admittedly, a small number of people. As the noble Baroness, Lady Howe of Idlicote, said, the BBC itself confirmed in an article in the Guardian in September last year:

Licence fee evasion is low”.

It is not low because people think they might go to prison, it is low because people believe in the BBC. I simply do not think that the signal that we are sending, that the status quo is all right, is acceptable.

Photo of Lord Lipsey Lord Lipsey Labour

My Lords, I support the amendment, despite the fact that I have considerable sympathy with the argument put by my noble friend Lady Corston. The status quo has persisted for a good long time. It will inevitably be re-examined on charter renewal—which I will come to in a minute—and it therefore seems to me that we can take a decision on whether decriminalising makes sense when we see whether it is relevant or not to that environment.

I sat on the Davies inquiry into the BBC licence fee in 1999 and, at the end of a year of study, probably knew as much about the licence fee as any man living. Unfortunately, like the man who once understood the Schleswig-Holstein question, I have long since forgotten all of it, save that the licence fee is a perfect way of funding the BBC but unfortunately is a poll tax that bears heavily on poor people. That core dilemma, if I can call it that, is something that we shall have to face up to when we come to charter renewal and to discuss BBC finance at the end of the current period.

At least four options are likely to be available: leave the licence fee as it is; what I guess the BBC will come down for, which is a slightly modernised licence fee, with people paying it for computers as well as televisions, which I am told are the same thing these days; a much greater modification to the licence fee; or some new form of finance. Those will be the broad options available when we come to charter renewal. This will be a very interesting argument.

I will just slip in something that I think would be very helpful at this stage. As part of the charter renewal process, it would be a very good move by the Government to set up an independent inquiry, such as the one I sat on with the noble Lord, Lord MacGregor, into the licence fee. In particular, it should produce a menu with prices to tell the public that if you want to pay this much licence fee, you can have these services, or if you want to pay that much licence fee, you can have those services and so on. At the moment, we are very much in the dark as to what that menu would be and what the choices would be, and an independent inquiry would greatly illuminate public debate.

To come to the kernel of this point, it does seem to me to be arse about tip—if I am allowed to use such an expression in this House—to take powers to change the basis on which the licence fee is collected long before deciding whether you want a licence fee at all, let alone what kind of licence fee you want. An inquiry into this is sitting, which will report. Then is the time for Parliament to take a view of its findings, together with the whole scenario for the funding of the BBC. Arse about tip is the only phrase I can think of for doing it right now.

Photo of Viscount Colville of Culross Viscount Colville of Culross Crossbench

My Lords, I am a producer at the BBC and I support this amendment. I want to emphasise and support what the noble Lord, Lord Lipsey, just said. We are not being asked today to decide whether the enforcement regime for the failure to pay the licence fee should be decriminalised or not—that is the subject of a review by David Perry, which seems to be a very wide-ranging and fair review.

However, if the review decides in June this year to go ahead with decriminalisation, and the Government implement that decision immediately, it will blow a huge hole in the BBC’s budget—the figure is actually £200 million rather than the £20 million suggested by my noble friend Lady Howe. The BBC has already made cuts of 26% over the present charter renewal period, which has resulted in great efficiencies. Thousands of jobs have gone and there has been a reduction in programme hours of current affairs, history, science and arts. A future £200 million cut, I fear, could put the existence of whole channels at risk. We have seen BBC3, the digital youth channel, go online. Between them, the local radio network and the children’s channels CBBC and CBeebies cost £200 million.

In Committee, the Minister said:

“It is right that the Government of the day must be free to consider the report when it completes in June 2015 and be able to act without unnecessary limitations at that point”.—[Official Report, 11/11/14; col. GC 42.]

I ask the Minister why the Government would want to blow a hole in the BBC’s finances at a time when the results of the review can be considered within a year or so as part of the charter renewal. I urge noble Lords to support the amendment and stop a very sudden and damaging reduction in the BBC’s revenue.

Photo of Lord Watson of Invergowrie Lord Watson of Invergowrie Labour 12:45 pm, 5th February 2015

My Lords, I support the amendment. I spoke on this matter in Committee, when the noble Viscount, Lord Colville, made the points he has just made about the £200 million shortfall that could well result. I have not seen that figure challenged in the months since. It is something that we have to take very seriously.

I do not want to reiterate the points made very eloquently by the noble Baroness, Lady Howe, and my noble friend Lord Lipsey, but I want to refer to the letter that the noble Baroness mentioned. I have a copy here. It is dated 21 October 2010 and is from the then Secretary of State, Jeremy Hunt, to Sir Michael Lyons, then chairman of the BBC Trust. It includes the important quote:

“The Government undertakes to provide a full financial settlement to the end of the year 2016/17, with no new financial requirements or fresh obligations of any kind being placed on the BBC and/or licence fee revenues in this period except by mutual agreement”.

We know that the BBC has not agreed to any such reduction, so that is one point. The other point is that in another part of the letter, the Secretary of State says:

“I believe the agreement we have reached provides certainty and security for the BBC over the settlement period”.

I believe that the Government should be obliged because of that letter in the name of the Secretary of State to uphold what was contained in it. Frankly, unless the amendment is accepted, there is a grave risk—it is not certain, I accept—that that will be the effect.

Whether or not the licence fee even has a future—personally, I very much hope it has—we do not know, but we do know that there are more than two years of the current licence fee period to run. The sort of shortfall that the noble Viscount, Lord Colville, mentioned is important, as is the 13% reduction in the licence fee because of it being frozen since 2010. The effect of that has to be taken into consideration. For those reasons, I believe that the Government are obliged to accept the amendment because only by doing that can they ensure that they uphold the commitment given by Jeremy Hunt in 2010.

Photo of Lord Grade of Yarmouth Lord Grade of Yarmouth Conservative

My Lords, first, I declare an interest as a former employee of the BBC and a former chairman of the BBC Board of Governors, and a current pensioner. Just to set that in context, my monthly sum does not cover my congestion charge for coming to this House.

I support the amendment moved by the noble Baroness, Lady Howe. The fiscal arguments have been well rehearsed. It seems very unfair to put the BBC’s fiscal planning at risk at a time when we are not that far away from the full-blown charter review and a total review of the means of funding the BBC. I will not rehearse those arguments again.

I state from the outset to the noble Baroness, Lady Corston, that I speak from the point of view that I would love to see non-payment of the licence fee decriminalised, but there are risks in doing that. There are risks that the enemies of the BBC will see it as an opportunity to remove the compulsory element of the licence fee and move the BBC to a subscription model, which would completely undermine the whole concept of public service broadcasting. I think there are dark forces at work, as you can tell from the overegging of the arguments that they have used. We have heard from those pushing for decriminalisation that the courts are “clogged up” and “overrun” with these cases. Nothing could be further from the truth. This was well rehearsed in Committee.

There is a sense in which this is a solution in search of a problem. There is not really a problem, but if it could be decriminalised without losing the compulsory element, that would be fine. But, of course, with the compulsory element, there would have to be some sanction. What is the sanction? We need to look at that, to understand that and to reflect on it in the context of charter review, not in a hurried order from government just months away from charter review.

I am deeply concerned about this measure. I am in favour of decriminalisation. A timetable is set for charter review. The present licence agreement runs out, as we have heard, in April 2017 at the end of that financial year. I see no reason to interfere with the BBC’s financial planning. I see every reason to support this amendment in order to take a measured look so that we do not interfere with the delicate financial arrangements for the BBC. Yes, those arrangements need looking at; yes, we will have plenty of time to do it after the election—I believe that there is one coming soon; I read it somewhere in one of the newspapers. Immediately after the election is settled, the starting gun will go on the charter review process. That is the time for all the stakeholders involved to have their say and to assess the impact of decriminalisation, what the sanctions will be and whether we will continue with a compulsory licence fee or some other form of funding. These are big, fundamental questions. There is a direct relationship between the source of funding and the kind of programmes that you get on your television and radio sets.

I ask the Government to think carefully before rejecting this amendment. Meanwhile, I lend my support to those on all sides of the House who are supporting it.

Photo of Lord Rooker Lord Rooker Labour

My Lords, I agree with what the noble Lord, Lord Grade, has just said and want to deal briefly with a procedural point. I had the privilege of chairing the Joint Committee which gave pre-legislative scrutiny to the Bill between July and December 2013—in fact, I am so fed up with it that I am bored stiff. However, this measure was not in the Bill. Therefore, I would argue from Parliament’s point of view that it did not have the scrutiny that such an important issue would justify, being put in in the Commons, being done in Grand Committee in this House and then being dealt with now.

It is almost a mirror image of the argument that we have just had on the counterterrorism Bill, where an attempt was made to make a change when it was known that inquiries are going on with a deadline next year for that matter to be properly dealt with, and the noble Lord, Lord King, therefore withdrew his amendment. This is exactly the same. As we have just heard, the licence fee is fixed—in writing, as it were—from 2010 to 2017. I do not want to see people in prison for debts—it is a complete waste—but the risk to the BBC of what might happen if this amendment is not carried is so substantial because of the forces charged up against the BBC in other guises. I declare an interest: I do not have Sky because I discovered that Rupert Murdoch is still alive. So I do not have these sorts of conflicts, but the fact is that those forces are lined up. There should be a proper duly considered argument in Parliament, maybe with differentials, after the review and in the context of us all knowing that a big discussion is going on, rather than its being dealt with in the Bill, which does not give this issue the scrutiny that it justifies because of the way that the Bill has gone through Parliament. I will support the amendment if it is pushed to a vote.

Photo of Lord Clement-Jones Lord Clement-Jones Liberal Democrat

My Lords, I agree with the noble Lord, Lord Rooker. As only the fourth spear-carrier on this amendment, I want to make just a few, very brief points.

We are, I hope, widely agreeing that this debate is purely about timing. As we have heard, there are supporters of the amendment who may go different ways. I happen to agree with the noble Lord, Lord Rooker, that this measure is in a sense a Trojan Horse designed to damage the BBC, but I suspect that there are many others who will disagree with me, including the noble Baroness, Lady Corston.

As we have heard from around the House, it is vital that licence fee penalties are considered in the round as an integral part of the review of the BBC’s charter and funding. The BBC has an agreed settlement until March 2017 and based its long-term planning around that. Unforeseen reductions in income will impact services and content to the detriment of licence fee payers—that is, if a different arrangement is made beforehand which has an impact on licence fee collection.

As we heard from the noble Lord, Lord Watson, there is another very important reason, quite apart from that budgetary one. It is about the undertaking given by Government back in 2010. The noble Lord quoted from the letter.

The noble Baroness, Lady Howe, has retabled her amendment and of course I strongly support it. We were not given a very decent response by the Government in Committee. My noble friend Lord Gardiner stated:

“Surely it does not make sense to apply any constraints that could hinder moving to a new enforcement regime; nor would any such constraint represent the best approach for licence fee payers, or the courts system”.—[Official Report, 11/11/14; col. GC 42.]

I believe entirely the opposite: this amendment, if adopted, would represent the best approach for licence fee payers. This is not an artificial limitation on timing. As my noble friend suggested, it is about keeping to the letter and spirit of the 2010 licence fee settlement to avoid unforeseen reductions in income adversely impacting BBC services and content, and to make sure that any changes to the enforcement regime are part and parcel of the charter review.

Photo of Lord Fowler Lord Fowler Conservative

My Lords, I strongly agree with what my noble friend Lord Grade said. I am entirely sympathetic to the idea of decriminalising the non-payment of the licence fee. I obviously understand the arguments on that. Indeed, I think I have put one or two of those arguments myself. However, as the noble Baroness, Lady Howe, said, we are at the start of the royal charter debate. The whole point of that debate, and of the royal charter, is that there should be some certainty as far as the BBC is concerned. That is the whole case that has always been put by Ministers in the royal charter argument.

To give an example, some of us—I might now say many of us—think that the BBC Trust is one of the worst ideas ever put forward by any Government. There are very few supporters of the BBC Trust. There were a few at the time but even then they were pretty limited and now there are practically none. However, what is the Government’s response to the question, “Can we change the BBC Trust?”? It is, “Not a bit of it. You must wait until the charter review. Then we will look at it and see what can be done as far as the BBC Trust is concerned”.

So I am a little puzzled why this very profound change being advocated by the other place—the decriminalisation of the failure to pay the licence fee—should go ahead in advance of the debate. We would go ahead although we knew nothing about the future of the BBC, the licence fee or the impact that it would have upon the finances of the BBC. That is all basic information that Parliament is entitled to have before making a change of this kind.

Yet we know that some of the most enthusiastic supporters of this change to the Bill are opposed to the licence fee in any event. This is just a mini sideshow as far as they are concerned. They oppose the BBC as a public broadcaster and advocate a subscription system; we know that. These are not penal reformers coming forward in the main but people having a go at the BBC. We know that: they want to change it. We should be realistic about this. For all those reasons, I do not see why this change and, frankly, those kinds of people, should be given precedence. We have said that as far as changes are concerned there is a royal charter process and royal charter period. We should stick to that. I support the noble Baroness’s amendment.

Photo of Lord Cashman Lord Cashman Labour

My Lords, I did not intend to speak in this debate but, having listened to those who have, I am inspired to do so. I absolutely agree with the noble Lord, Lord Fowler, in his assessment. Like the noble Lord, Lord Grade, I have to declare an interest as a former employee of the BBC but, unlike him, I do not receive a pension—not even to cover my congestion charge. However, I see the clause as an attempt to restrain the BBC. It is a seatbelt wrapped over the BBC. It will stop it being able to do any long-term planning. That great public broadcaster will be inhibited from entering contracts of employment with its own staff, let alone the staff it needs to bring in if its long-term planning is to produce the very programmes that we demand and maintain the excellence of its news coverage—although I do not always agree with it.

I urge your Lordships to support the amendment of the noble Baroness, Lady Howe. It is sensible; it gives certainty. Any decisions about the future of the BBC should take place after long and considered discussion.

Photo of Baroness Benjamin Baroness Benjamin Liberal Democrat 1:00 pm, 5th February 2015

My Lords, I, too, support the amendment of the noble Baroness, Lady Howe. I declare an interest as a presenter of some of the BBC’s iconic children’s programmes and an independent television producer. I agree with what many noble Lords have said in support of the amendment.

However, I want to talk about the potential impact on the BBC’s children’s programming if the noble Baroness’s amendment is not accepted. We have already heard that if licence fee evasion were to increase to —let us say—10%, it could result in a reduction in the BBC’s revenue of about £200 million per annum. That could mean that children’s original content provision will suffer. The UK has a highly competitive children’s media market, with probably the highest number of dedicated television channels anywhere in the world. However, with the exception of CBBC and CBeebies, most of those channels show little or no UK original content. Their schedules largely consist of material bought in from abroad.

I understand that the BBC’s executive has taken the decision to protect the children’s department budget, but that has meant that the reduction in its budget is proportionately much less than the reductions agreed for other BBC services. The children’s department commissioning budget will reduce from £150 million in 2011-12 to £101 million in 2016-17. So already a planned impact on the budget of children's programmes has been put in place. I believe in the BBC’s sincere and long-term commitment to children’s programming. However, I worry that the BBC has agreed a licence fee settlement until 2017 on which it has based its long-term budget planning. Unforeseen reductions in income will impact services and content, and that will include the high-quality provision freely available for our children.

Therefore, I support the amendment, which is intended to ensure that any impacts on the BBC’s funding resulting from the Perry review are not introduced until 1 April 2017, the first day of the next licence fee settlement. Surely we can wait until then.

Photo of Lord Inglewood Lord Inglewood Chair, Extradition Law Committee

I rise to join the chorus in support of the noble Baroness, Lady Howe. This is part of a much wider question, which, as several speakers have said, will be determined over the next few weeks, months and years. It should remain an integral part of that process and not be sliced off like a piece of salami. The only substantive objection against the amendment of the noble Baroness, Lady Howe, in the debate this afternoon has come from the noble Baroness, Lady Corston. I have every sympathy for the predicament that she describes, although I have no knowledge of the facts to which she referred. It seems to me that what she was describing is not a consequence of criminalisation but a consequence of what happened in the courts and the actions of the relevant social services. It is important to decouple the two. I think it would be very foolish not to support the noble Baroness, Lady Howe.

Photo of Baroness Deech Baroness Deech Crossbench

My Lords, I declare an interest as a former governor of the BBC. I recall charter renewal as a long, drawn-out process involving all sorts of different elements, and it would be wrong to pick this one out for fundamental change before the entire charter is reviewed. The other issue is that the licence fee is clearly due for the most fundamental reanalysis because both those who can afford it and those who cannot are very likely to be looking at BBC output on their iPads or computers. That is something that the licence fee arrangements have yet to grapple with. It is an enormous question that deserves careful attention—but in the holistic review of the entire charter. Therefore, I, too, support this very sensible amendment.

Photo of Lord Stevenson of Balmacara Lord Stevenson of Balmacara Shadow Spokesperson (Business, Innovation and Skills), Opposition Whip (Lords), Shadow Spokesperson (Culture, Media and Sport)

My Lords, I thank all speakers for contributing to this debate and make special mention of the noble Baroness, Lady Howe, for all her campaigns, but particularly on this issue, which she has pursued with considerable vigour over the past few months. I also thank the noble BBC pensioner, the noble Lord, Lord Grade, for his support. It might be of interest to the House that he has had to change long-standing family arrangements to be here today, and we are grateful to him for that. The fourth spear carrier, the noble Lord, Lord Clement-Jones, has joined the charge and made a valuable contribution.

We have heard little vigorous debate about this issue because just about everybody is in favour, with the exception of the impassioned speech from my noble friend Lady Corston. Like other noble Lords, I share her concerns and regret that we did not tackle this issue earlier, because it is clearly causing considerable dismay.

When issues of public policy need to be resolved, there is no better place to do it than in your Lordships’ House, and this debate has lived up to its highest reputation. I should like to make three points.

First, this is an important matter. The BBC is the gold standard of our broadcasting system, which is one of the best in the world. We should never forget that. We take for granted the information, education and culture that the BBC produces hour after hour, day after day, and never really question how it has adapted to and survived so many changes over the decades, and how the system has evolved to make sure that that happens.

At a time when the very nature of the British state is under question, we should be very careful about tinkering with the long-established procedures under which it operates. I do not need to remind your Lordships’ House that, in survey after survey, the BBC ranks as one of the most important signifiers of the United Kingdom in all four countries. Recent experience in Scotland demonstrates what happens if that becomes an issue of debate in a referendum.

Over time, we have established appropriate procedures for exercising effective but arm’s-length oversight of the BBC, involving, as we have heard, periodic reviews of the charter and licence fee and the regular fixing of budgets. Previous charter reviews have taken two or three years of consultation and debate—although I understand that the timescale for the 2010 licence fee settlement was perhaps weeks, if not days. However, that does not depart from my general point.

Most people in the UK feel that there would have to be a very pressing reason for the Government of the day to depart from long-established procedures for settling the governance and funding of the BBC. I think it would be very unwise for any political party to play around with the BBC for short-term political advantage.

Secondly, I turn to the review. We support the review being undertaken by David Perry QC. We do not know what the review will recommend on the important question of decriminalising penalties. As I said, my noble friend Lady Corston made some very good points that need to be considered. Having said that, this is complicated and, as has been said, is as much to do with the courts and social services as how the BBC operates. This issue has not passed the test of being a pressing reason to depart from normal governance procedures. We think that it is right to wait for the outcome of the review before any decisions are taken.

We must consider whether there is any reason for intervening in advance of the licence fee settlement, and we do not think the case has been made. In all the reasons that have been given today, I have not heard one to suggest that that needs to be departed from.

Thirdly, we need to probe deeply into what the Government are saying. As the noble Baroness, Lady Howe, and my noble friend Lord Watson said, when the 2010 licence fee settlement was announced, the letters that went out at the time said that the settlement would,

“provide a full financial settlement to the end of the year 2016/17”— the end of the year 2016-17—

“with no new financial requirements or fresh obligations of any kind being placed on the BBC and/or license fee revenues in this period”.

I call on the Government today to honour that commitment on certainty and security, which they can do in part by accepting this amendment.

As my noble friend Lord Rooker said, we need to recall that this clause was not in the Bill when it was first introduced to Parliament, and therefore not subject to pre-legislative scrutiny. It came late in the process, when the Government rather unexpectedly accepted a Back-Bench amendment from their own side in the other place. It has never been properly considered or scrutinised; the only discussion has been in Committee in this House. In that Committee, the Minister said:

“The findings of the review … should be considered in the context of the charter review”, a statement to which we could not object. However, he went on to say:

“It will be for the Government of the day to take forward any further actions as they see fit”.

Further, he said that the argument in favour of that action was that if the review were to find,

“an issue with the current regime, it can be of benefit to no one to delay the review or to prevent its findings informing any required change to the existing system”.—[ Official Report , 11/11/14; col. GC 31.]

This is specious, and sophistry. If the review was to recommend a change in process, there could, as we have heard, be a gap of some £200 million a year for the BBC in the last year of an already very punishing settlement. As the noble Lord, Lord Fowler, suggested, the Government are trying to have it both ways. They are trying to persuade us that they are indeed with the angels on the charter review, requiring it to be a full and proper process, but at the same time wishing to reserve their position in case there is an opportunity for them to cut funding to the BBC in 2016-17. This is wrong.

I put it to the Minister that by resisting this simple and principled amendment today, he will be fuelling a sense that this Government are doing what they can, when they can, to weaken the BBC. As the noble Lords, Lord Grade and Lord Fowler, warned, it opens the door for darker forces in favour of a different funding model for the BBC. It is not just a simple reform of the penal system. The reaction to this issue today, from right across your Lordships’ House, which I aver is echoed across the country, shows that it would be completely wrong for the Government to introduce a significant change in funding for the BBC before the start of the next licence fee period on 1 April 2017. If the noble Baroness, Lady Howe, wishes to test the opinion of the House, we will support her.

Photo of Lord Mackay of Clashfern Lord Mackay of Clashfern Conservative

Before the noble Lord sits down, is there any reason why, in the mean time, an amendment to the arrangements for the problem raised by the noble Baroness, Lady Corston, could not take effect? This amendment appears to cut that out also, until the 2017 deadline. It strikes me that the problem, which the noble Baroness explained fully, has a very serious and unnecessary effect on families. I should like to see the possibility of that being dealt with. I do not agree that it would be all that difficult because the civil sanction would remain, so I find it difficult to agree that that should be cut out. I understand all the rest with reasonable clarity but I do not understand why this particular aspect should be cut out, as I understand it would be by this amendment.

Photo of Lord Stevenson of Balmacara Lord Stevenson of Balmacara Shadow Spokesperson (Business, Innovation and Skills), Opposition Whip (Lords), Shadow Spokesperson (Culture, Media and Sport)

I am very flattered to be invited by the noble and learned Lord to reflect on what he has said, which makes a great deal of sense. I suggest that it is for the Government to say whether they could take forward the sensibility of my noble friend Lady Corston’s points because it seems that they might require additional funding, which could of course be provided by the Government, should they wish to do so. It is not my position to say that. However, I think the noble and learned Lord is saying that if one could, with equity, deal with my noble friend’s arrangements then we would have solved one problem. I put it to him that it would not solve the greater problem: that there should be a self-denying ordinance from any Government, and not a willingness to interfere with long-established procedures for making sure that the BBC has the funding it needs to do the job that it is required to do. I hope that he would accept that.

Photo of Lord Gardiner of Kimble Lord Gardiner of Kimble Lords Spokesperson (Department for Culture, Media and Sport), Lord in Waiting (HM Household) (Whip)

My Lords, this has been an extremely interesting debate and comes, as your Lordships’ debates so often do, with a great deal of experience. A television licence is required to watch all live and nearly-live broadcast television content on any device in the United Kingdom. People should not seek to evade this and there needs to be an effective enforcement regime for the failure to have a TV licence.

Clause 64 confers a new power on the Secretary of State, via secondary legislation, to change the sanctions that apply to the failure to have a TV licence. There was significant cross-party support for the TV licensing clauses in the early stages of the Bill in the other place. We believe that the firm commitments set out by the Government at that time should be honoured, particularly given the strong cross-party support. Whatever opinion your Lordships take, the points that the noble Baroness, Lady Corston, made often came to the heart of the dilemma in how we take this matter forward. I will be raising that in greater detail.

This is a matter that concerns a lot of people. The Government are very clear that the review of the licensing enforcement regime should therefore be a priority. The decision was taken to begin this review in advance of Royal Assent, while retaining the clause that commits the Government to carrying out the review to ensure that this important work is completed. I am particularly mindful of the concerns that a number of your Lordships have raised about this review: as a stalking horse for bigger issues such as broader funding and income and, probably worse still, about an undermining of the BBC. It is therefore important that I should at least seek to address your Lordships’ concerns head-on by stating unequivocally that the review of the licensing enforcement regime is no such thing; it is an independent review, set up to deliver recommendations and the best outcomes for the licence fee payer, the courts system and, I emphasise, the BBC itself.

The independent lead reviewer, David Perry QC, is working to tightly defined terms of reference which set out the scope of his work. The key aspects of the terms of reference in this context are that any recommendation must be made on the basis of delivering:

“Value for money for Licence Fee payers and tax payers in enforcement of the failure to have a TV Licence, including operational, revenue and investment costs of the enforcement regime to the BBC”.

That latter point is crucial here: any recommendation made by the Perry review will be made on the basis of revenue and cost to the BBC, and will include considerations such as the amount of licence fee that the BBC has to spend on enforcement. As such, any decision made by the Government of the day to adopt these recommendations will be grounded in these considerations, too.

The review is designed to ensure that there is a strong, evidence-based case for any potential changes to the TV licence enforcement regime. It will not consider any other changes, such as the cost of the licence fee. The review will begin imminently, with formal stakeholder engagement and public consultation. This will be an opportunity for the public, as well as the BBC and other parties, to feed into the review. The noble Baroness, Lady Howe, is absolutely right: my understanding is that the BBC is very welcoming of discussion and dialogue, as I would expect.

The findings of the review, which will be completed this June, will be laid before both Houses of Parliament and presented to the BBC Trust. A number of your Lordships, including the noble Baroness, Lady Howe, the noble Viscount, Lord Colville of Culross, and my noble friends Lord Grade and Lord Inglewood, raised the issue of the findings. To reaffirm what I said in Committee, I emphasise again that the findings will be considered in the context of the charter review. As your Lordships know, the BBC’s current charter expires on 31 December 2016. The Government will not begin the charter review until after the election, so there is no set process for how the review of the charter should be conducted, or when. It will be for the Government of the day to take forward any further actions they see fit.

Clause 64 provides for the sanctions to be changed, either by replacing the criminal regime with a civil regime, with civil monetary penalties payable to the BBC, or by creating a civil regime that sits alongside the criminal regime as an alternative to prosecution, establishing powers to impose a fixed or variable money penalty in relation to a TV licensing offence. Clearly, we must not prejudge Mr Perry in his making of recommendations, and it will be for the Government of the day to decide whether they wish to implement any changes to the current system. However, I reassure noble Lords that the clause does not mean that any changes can or would be instantly applied without the requisite scrutiny and debate. This House would have a further opportunity to scrutinise and approve any proposed changes when considering any regulations made under Clause 64. I hope that that point will help, even if only a little, my noble friend Lord Fowler and the noble Lord, Lord Rooker. Your Lordships’ House and the other place will need to consider all these matters.

Let me go to the heart of the issue about the dates. The noble Baroness’s proposed amendment would prevent any such changes from taking place before 1 April 2017. Of course I understand the concerns that have been presented by noble Lords seeking to protect the BBC. However, any conclusions and recommendations from the review will have been reached through careful consideration of the benefits to the licence fee payer and the BBC. It will therefore not be in their interests to put constraints on taking forward the implementation of the recommendations. As I have already set out, this is an independent evidence-based review, with clearly defined terms of reference that include the need to consider value for money,

“including operational, revenue and investment costs of the enforcement regime to the BBC”.

However, I emphasise that this is not about cutting costs. The review will also be considering fairness for all licence fee payers and the effectiveness of deterring evasion. Crucially, value-for-money considerations must also encompass the level of licence fee money spent on TV licensing enforcement. If there is potentially an issue with the current regime—obviously we make no assumptions about this while the review is still under way—it can surely benefit no one, least of all the licence fee payers and the BBC, to prevent its findings from informing any required change to the existing system as soon as is reasonable. Our concern is that the amendment would potentially prevent the Government, post election, from being able to ensure that the right enforcement regime for the BBC, licence fee payers and the courts, and probably particularly for the sort of people that the noble Baroness, Lady Corston, has referred to, can be put in place following—I emphasise this—the appropriate parliamentary processes.

On the issue of timing, this will not be an immediate process. The issue cannot be seen in isolation. The report’s findings and future implementation on the part of the Government will require serious consideration in the broader context of the charter review. I think that this is what the noble Viscount, Lord Colville of Culross, was referring to; I think that his word was “immediate”. This is not going to mean immediate implementation in June 2015; that is only when the recommendations will be received. So not only is this in the broader context of the charter review but any recommendations made by Mr Perry will have considered the impact on the BBC and whether those options would represent an improvement to the current regime. That is clearly set out in the terms of reference.

Being too restrictive in aligning the timing of any changes with the charter review and the licence fee settlement would place unreasonable constraints on the Government of the day that we believe would not represent the best approach for the licence fee payer, and indeed the BBC. In short, should Mr Perry’s review identify potential changes to be made that could, for instance, deliver a better system for the BBC, how could it be to the benefit of the corporation, or indeed licence fee payers or the courts system, to impose any delay in implementing those options?

Photo of Lord Rooker Lord Rooker Labour 1:15 pm, 5th February 2015

The answer to that is: because it would cause massive unpredictability at the time as no one would know the results. Before the Minister sits down, will he address the point about the letter that was referred to, and the clear statement in it, from Jeremy Hunt in 2010?

Photo of Lord Gardiner of Kimble Lord Gardiner of Kimble Lords Spokesperson (Department for Culture, Media and Sport), Lord in Waiting (HM Household) (Whip)

Our overriding aim is to ensure that the system is appropriate, proportionate and fair and represents the best value. It is important that we achieve the best outcome for licence fee payers but also that we achieve an appropriate outcome for the BBC. I do not accept that this will necessarily adversely affect the BBC; the whole purpose of the terms of reference is to ensure that all these matters are given due and proper consideration. If the Government’s options were constrained by the proposed amendment, then that might not be the case.

Much of the discussion of the review and the potential changes to the enforcement regime has presumed that the outcome will be a negative one for the BBC. That is simply not the case. Again, I draw noble Lords’ attention to the terms of reference for the review and to the independence from the Government of the lead reviewer. I reiterate that the intended outcome of the review is recommendations that achieve the optimal result for all—licence fee payers, the courts system and the BBC itself. As I have said, the review recommendations will require serious consideration by the Government of the day, and this House will have a further opportunity to scrutinise and approve any proposed changes.

This process will take time; indeed, along with the wider considerations, any changes would be unlikely to be finalised much before 1 April 2017. However, we believe that to tie any changes to a specific date would be a constraint that could delay improvements—I emphasise “improvements”—to the regime for the people that the noble Baroness, Lady Corston, and my noble and learned friend Lord Mackay of Clashfern were bringing into their considerations. We should not presume that these are not improvements.

Photo of Lord Fowler Lord Fowler Conservative

My Lords, I have listened very carefully to what my noble friend has said. Basically, if he is saying that any Government, not just this one, can set up an independent review and make any changes to the charter agreement, have they not just obliterated the whole principle of certainty over a 10-year period?

Photo of Lord Gardiner of Kimble Lord Gardiner of Kimble Lords Spokesperson (Department for Culture, Media and Sport), Lord in Waiting (HM Household) (Whip)

It is why I emphasised particularly that this piece of work should be seen as running alongside and parallel with the charter review. It is clearly the case that what comes forward from the review will play its part in the charter, for the very reasons that a number of noble Lords raised.

It is for the reasons that I have outlined that, with regard to the timings, I and the Government believe that whoever the Government of the day are, if there are improvements to be made and the review comes forward with legitimate improvements, it would be unnecessarily prescriptive to keep it to 1 April 2017. It is for those reasons that I ask the noble Baroness to give consideration to withdrawing her amendment.

Photo of Lord Grade of Yarmouth Lord Grade of Yarmouth Conservative

Before the Minister sits down, could I be absolutely clear that the Government’s position in resisting this amendment is that it sits outside those undertakings given by the Secretary State, Jeremy Hunt, at the time of the last licence fee settlement? Is the Minister content that the challenge is on the basis that this would clearly be outside those undertakings?

Photo of Lord Gardiner of Kimble Lord Gardiner of Kimble Lords Spokesperson (Department for Culture, Media and Sport), Lord in Waiting (HM Household) (Whip)

I say to your Lordships what I said before: the review being undertaken on this matter is particularly engaged with terms of reference that refer to what the impact would be on the BBC, so what Mr Perry will be considering is precisely the points that my noble friend makes. As I said, our view is that if there are improvements to be made, and the sort of remedies that may possibly be suggested would be of help, then why not put them forward—to pluck an example—on 1 January 2017 rather than 1 April? It is for those reasons that I very much hope that the noble Baroness will consider withdrawing her amendment.

Photo of Lord Skelmersdale Lord Skelmersdale Deputy Chairman of Committees, Deputy Speaker (Lords) 1:30 pm, 5th February 2015

Before my noble friend sits down, I have listened to the whole of this discussion and it seems to swing on the results of the price review. Can my noble friend give a cast-iron guarantee that the Government will not operate Clause 64 until or unless that review comes to the conclusion that he suspects it might?

Photo of Lord Gardiner of Kimble Lord Gardiner of Kimble Lords Spokesperson (Department for Culture, Media and Sport), Lord in Waiting (HM Household) (Whip)

I may have to think about what my noble friend is referring to. He has his own way of seeking to bamboozle me. This is about an independent review that will furnish the argument, and, because of its timing, will quite rightly be within the context of the charter review. We think it is reasonable, if there are improvements to be made, whatever options are decided to be the best for all the parties that are part of the terms of reference, to set a particular date if improvements could be made for everyone’s benefit; that would be the best way forward.

Photo of Lord Stevenson of Balmacara Lord Stevenson of Balmacara Shadow Spokesperson (Business, Innovation and Skills), Opposition Whip (Lords), Shadow Spokesperson (Culture, Media and Sport)

May I assume that the nutcracker which the Minister has just experienced from the two noble Lords behind him is correct and that the answer is yes to both questions? The Minister said yes to the noble Lord, Lord Grade, but, in certain circumstances and with certain results—which is the point made by the other noble Lord—you would go against what the Secretary of State said in open letters to everybody in the country: that the settlement for a five-year period was without precedent and would never be changed because it gave the security required by the BBC to do its job. Now the Minister is accepting exactly the opposite.

Photo of Lord Gardiner of Kimble Lord Gardiner of Kimble Lords Spokesperson (Department for Culture, Media and Sport), Lord in Waiting (HM Household) (Whip)

My Lords, all I am saying is that I am not going to prejudge the review which was established to deal with the matter of revenue to the BBC. Let us see what the review says. But if there are improvements to be made, they should be made within the context of the charter review.

Photo of Lord Clement-Jones Lord Clement-Jones Liberal Democrat

My Lords, just to knock things on the head before the Minister sits down, can he confirm that, despite all the discussion that has taken place between Committee and Report, essentially—I quoted the Minister when I spoke—the Government’s position has remained completely the same?

Photo of Baroness Howe of Idlicote Baroness Howe of Idlicote Crossbench

My Lords, I thank the Minister for his attempts to persuade me and many others that our amendment, which is a thoroughly cross-party amendment, is unnecessary. This debate was one of the most interesting that I have heard in this House—and I listen to a lot of debates. It covered a huge range of issues, approaches and experience. The more I listened to the various questions about why the Government should be able to accept the amendment, the more convinced I was when the Minister argued the other way that there is little doubt about the need to put the question to the vote.

When I introduced this amendment, my approach was a little short of perfect, and I apparently misquoted the odd figure—although £200 million was certainly right. I had it written down, but I read it badly. There were one or two other points. I apologise to the noble Baroness, Lady Corston, because I had a word with her outside and I think that she has a point, but not one that is even remotely relevant to what I and many other Members who have spoken were trying to put over. It is something that I would be more than happy to take up with her, because quite clearly if it results in this number of women ending up in prison, with detriment to various members of their family, something is wrong. Let us face it, nothing in this life is perfect and not subject to the need to change at some stage.

I shall not go on because everything that needed to be said was said in the debate. It has completely convinced me that there is a need to test the opinion of the House.

Division on Amendment 27

Contents 178; Not-Contents 175.

Amendment 27 agreed.

Division number 1 Deregulation Bill — Report (2nd Day)

Aye: 176 Members of the House of Lords

No: 173 Members of the House of Lords

Ayes: A-Z by last name

Tellers

Nos: A-Z by last name

Tellers

Consideration on Report adjourned until not before 2.48 pm.