Digital Economy Bill - Committee (4th Day)

Part of the debate – in the House of Lords at 4:30 pm on 8th February 2017.

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Photo of Lord Lester of Herne Hill Lord Lester of Herne Hill Liberal Democrat 4:30 pm, 8th February 2017

My Lords, this is a paving amendment for this group of amendments. My noble friend Lord Clement-Jones asked just now what the appropriate collective description of Queen’s Counsel is. I was pondering that; at first, I said to myself, “Avarice”, but then I thought that the true answer would be given by The New Yorker book of cartoons, which had a cartoon of a lawyer looking at his client and saying, “How much justice can you afford, Mr Pitkin?”

The Committee will be deprived of several speakers who cannot be here today, who have supported this amendment and the others in the group. They include the noble Lords, Lord Pannick and Lord Inglewood, who asked me to apologise on their behalf.

I explained in previous debates why I believe that statutory underpinning is needed to protect the BBC’s independence and viability, free from political interference. During the take-note debate on the draft BBC charter on 12 October 2016, I expressed the hope that the drafts would be amended. I pointed out that the central problem with the Government’s proposals for the charter—raised across the House by, for example, the noble Lords, Lord Fowler, Lord Inglewood and Lord Best, former chairs of the Communications Committee, the noble Lords, Lord Stevenson of Balmacara, Lord Burke, Lord Pannick, Lord Colville and the noble Baroness, Lady Deech, and my noble friends Baroness Bonham-Carter and Lord Foster of Bath—is that there are no statutory criteria or requirements that must be met in the charter or the agreement with the Secretary of State.

I noted that the draft charter and agreement did not put the Government under any duty to ensure that the BBC remains independent. They contain no obligation to ensure that the BBC is properly funded to perform its public functions. There is no commitment to avoid further top-slicing of the licence fee after the transfer of the cost of free licence fees for the over-75s, which will have a serious adverse effect on the BBC’s funding and programming—a 20 to 25% cut in licence fee funding. In my view, that was unseemly and deeply regrettable, but it is now too late to reverse it.

I criticised the lack of an independent process for appointing the members of the new unitary board on merit, to prevent cronyism. I warned that Ministers remained able to determine what “distinctiveness” means. There was no protection for the BBC against much richer competitors, challenging the current and future BBC programming. Powerful criticisms to similar effect were made across the House, but the Minister did not give ground on any of those points. The new charter and agreement were brought into force completely unchanged. As the Minister may confirm—I hope that he will—the Government retain the right to make further inroads into the BBC’s revenue by transferring responsibility, including liability and costs, for any public expenditure.

I also spoke during the Second Reading debate on the Bill on 13 December 2016—I am becoming something of a BBC charter bore in this House. I explained that what I meant by statutory underpinning is that Parliament should prescribe the basic principles protecting the BBC’s independence and viability as a public service broadcaster. I concluded by describing myself as an optimist and expressed the hope that the Government will sympathise with our moderate and practical approach. I am still optimistic that we may reach agreement with the Government on a protective framework of principles during the remaining stages of the Bill’s passage. That would be in the Government’s, and the public, interest.

A question raised by these amendments is one of principle, to which I would be grateful for the Minister’s reply. The question is this: is statutory underpinning of a royal charter both possible and legitimate? I hope he will confirm that the answer is yes.

There are several precedents for a combination of legislation and charter, notably the Leveson legislation on the print media and the National Citizen Service Bill. Both provide underpinnings for royal charters, although no doubt civil servants will come up with clever arguments as to why they are different. However, I am not raising that question but the question of principle: is there any reason in principle why statutory underpinning is incompatible with the idea of a royal charter?

In his letter to me of 4 January, for which I am grateful, the noble Lord, Lord Ashton of Hyde, claimed that the Government had increased the BBC’s freedom, “to use its money as it sees fit”. I should be grateful for his confirmation that the BBC’s revenue from the licence fee is indeed the BBC’s and not the Government’s money, and for his assurance that there will be no further raid by this Government on the BBC’s revenue. Will he also confirm that without legislation, a future Government would be free to make further raids: in other words, that the most he can do is give an assurance about this Government? The Minister went on to say in his letter that the Government remain of the view that any statutory underpinning to the charter which would expose the BBC to party political pressures would not be in the interests of an independent BBC. There is a whiff of the Brexit debates about that statement. Ministers exercising monarchical prerogative powers claim to be better able to protect the interests of the BBC than Parliament. I agree that the BBC needs to be protected against politicians, whether in or out of office. Ministers are as susceptible to party political pressures as other MPs, and the BBC needs to be protected against both. If the amendments are agreed to, they will give protection and can be abolished or weakened only by a future Act of Parliament. I submit that Parliament’s use of its legislative powers provides better protection than ministerial assurances, which in any case are outlived when the Government change.

I turn now to the specific amendments and hope that the Minister will be able to reply to each of them at the appropriate point. I introduced them in some detail in my speech at Second Reading, so I will not bore the Committee by going through them again. I simply wish to explain to those who are interested what the amendments are designed to. Your Lordships will see that Amendment 217 on the Marshalled List is simply a paving amendment to provide the statutory underpinning that follows. Amendment 218 deals with the independence and funding of the BBC. I am not going to read out the whole amendment—some of it can be found in the royal charter, but in my view all of it ought to be in legislation. If it can be in the royal charter, I am puzzled as to why the Government believe it should not find its way into the Act of Parliament. For example, subsection (2) would insert proposed new section 198ZC, in which new subsection (1) states:

The BBC is to be independent in all matters concerning the content of its output, the times and manner in which its output is supplied, and the governance and management of its affairs”.

Does the Minister agree with that? I am sure that the answer is yes. Proposed new subsection (2) goes on:

“The Prime Minister, the Secretary of State, the BBC, OFCOM, and all other persons and bodies with responsibility for matters relating to the governance and establishment of the BBC must ensure that the BBC is able to operate independently from Ministers and other public authorities in the United Kingdom”.

Again, does the Minister agree with that? I would expect him to say yes.

Proposed new subsection (3) states:

“In carrying out the duty … the Secretary of State and other Ministers of the Crown must not seek to influence the BBC’s decisions; and … must have regard to the need to defend the BBC’s independence; and the need for the BBC to have the financial and nonfinancial support necessary to enable it to exercise its functions”.

Does the Minister agree? Surely, he does. Then, in carrying out the duty, the Minister,

“must have regard to the need for the public interest to be considered in regard to matters relating to the BBC”.

Again, I see no cause for controversy.

Proposed new subsection (4) states:

The Secretary of State must make available to the BBC sufficient funds, through the licence fee and otherwise”— because there are other ways of funding apart from the licence fee—

“to enable the BBC to perform its functions and public purposes as a public service broadcaster”.

I cannot see any conceivable controversy about that notion.

Proposed new subsection (6) states:

“The licence fee is to be for the exclusive benefit of and use by the BBC to fund the performance of the BBC’s functions and public purposes”.

Again, I should have thought that was obvious. Then there is indexation, but I do not need to pause for that.

Proposed new subsection (7) states that,

“the Secretary of State may not transfer to the BBC responsibility, including liability and costs, for any public expenditure”.

That, I think, would be resisted by Her Majesty’s Treasury, which is delighted to be able to claw back anything it can in order to transfer liability from the taxpayer to the BBC, but it is very important that the legislation protect the BBC against topslicing.

Amendment 219 deals with the governance of the BBC. I will not go through it in any detail. It is our attempt to make sure that the BBC’s new unitary board is appointed not on the basis of political cronyism, but by a proper, independent, merit-based process and on the basis of proper competition. Again, I would hope that these days, that would be acceptable to a modern, responsible Government.

Amendment 229A deals with governance and appointments. Again, I do not need to read that out because everyone in this House is just as able as I am to read all the material.

That is the thrust of the amendments, and I beg to move.

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