Digital Economy Bill - Committee (4th Day) (Continued)

Part of the debate – in the House of Lords at 8:45 pm on 8th February 2017.

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Photo of Lord Puttnam Lord Puttnam Labour 8:45 pm, 8th February 2017

My Lords, in speaking to the two amendments that stand in my name, I should first declare my interest both as a content owner and as president of the Film Distributors’ Association. A number of factors encourage me to take up what is in effect the unfinished business of 15 years ago, when I was closely involved in the 2003 Communications Bill. The most recent was something that the noble Baroness, Lady Warsi, said on the “Today” programme 10 days ago. In response to a question regarding the ramifications of the immigration controversy raging across the Atlantic, she said:

“It all comes down to the type of country we want to live in”.

Of course, the noble Baroness was right. Pretty well every decision we make in this House sooner or later comes down to the type of country we want to live in. What we have just heard from the noble Baroness, Lady Benjamin, is about precisely that. What kind of country do we want to live in, and how far are we prepared to push ourselves to get there?

As I am sure the noble Baroness, Lady Buscombe, will confirm, this was repeatedly discussed during the passage of what became the Communications Act 2003. At that time we were by turns both amused and concerned by the antics of the then Italian Prime Minister Silvio Berlusconi and his attempts to muzzle, or better still own, the Italian media. This House was at one in agreeing that the provision of a free, fair and plural media ecology, in all its many and varied forms, was fundamental to the health of any democracy worthy of the name.

As a result, and after a great deal of debate, the general duties of Ofcom in carrying out its functions were finally legislated in this way:

“It shall be the principal duty of OFCOM, in carrying out their functions—

(a) to further the interests of citizens in relation to communications matters; and

(b) to further the interests of consumers in relevant markets, where appropriate by promoting competition.

The wording of those two general duties, and the order in which they fall, along with the public interest test that accompanied them, were hard fought for, and they were won by an overwhelming vote on the Floor of this House—two-thirds to one-third—against the wishes of both Front Benches.

Fifteen years later, we find ourselves looking anxiously across the Atlantic at a new and democratically elected kind of Berlusconi on stilts—and we are jolted into reminding ourselves how very much ownership of both the media and the message matters. The true architect of the public interest test was the noble Lord, Lord Crickhowell, and the engineer who created the double lock that gave it teeth was the now noble Lord, Lord Lansley.

As the House may know, a public interest intervention notice is issued by the Secretary of State, and specifies a media interest. The grounds for referral are listed in Section 58 of the Enterprise Act 2002: the media interest grounds for referral are listed in Section 58 (2A) to (2C). The Secretary of State may specify further grounds for referral by laying an order before Parliament. Ofcom then carries out a report based on the grounds specified by the Secretary of State.

That is what is supposed to happen—but, as we discovered during the misadventures of the then Secretary of State, Jeremy Hunt, there is far too much wriggle room, and a lack of clarity as to the precise grounds on which a referral is based. In this respect, I supplied the Minister with a copy of the five-page letter I sent to Jeremy Hunt on 11 March 2011, setting out the reasons why I believe that the UILs he proposed to set in place prior to waving through the then News Corp—now 21st Century Fox—bid for what was then called BskyB were hopelessly inadequate. Milly Dowler’s death made any response to that letter wholly unnecessary.

Following a meeting that the present Secretary of State kindly agreed to, I recently sent her a copy of that letter, for the consideration of her officials. In my note to her I included a few additional reasons why I felt reference to Ofcom was the only sensible way in which any new bid for Sky could be transparently dealt with. Given that the Government have the world’s most highly regarded media regulator at their service, it is extremely hard to see why they would not be eager to distance themselves from the well-documented suspicions of favours given and favours returned that now, sadly, dog their predecessors.

The purpose of my amendments is to buttress the referral process by adding further and easily understood grounds directly to the Bill. Specifically, they would add a fit and proper persons test, which, somewhat bizarrely, exists only as an ongoing test for licence holders, not bidders, and is thus to be conducted only after the fact of any merger. I say “bizarrely” because I ask: how sensible does it seem to judge the ongoing fitness and propriety of a licence to a higher standard than the one sought at entry? Possibly when she comes to answer the Minister might help me understand what I see as an extraordinary anomaly.

The amendments also suggest an additional test to underpin the safeguards of editorial independence to ensure against the slow “Foxification” of the at present altogether excellent Sky News service. Anyone who has ever read Sir Harold Evans’ chilling book Good Times, Bad Times will know only too well what can happen to the overeager and gullible politician who seeks a simple answer to a complex issue. Fox News may have been a significant success in the United States, but I am certain that few in this House would wish to see the results of that particular success replicated in this country.

We also suggest a slightly wider plurality test—one that takes account of and acknowledges the impact of rapidly changing market power in the acquisition of content and its consequential distorting effect on the advertising marketplace. The second of these amendments would add greater clarity to Ofcom’s existing and ongoing “fit and proper” test for licence holders. It does so by using the language of the terms of reference of Leveson 2, drafted by the previous Prime Minister. Such an amendment would make clear that, for the bid to go through and for Ofcom effectively to carry out its scrutiny of the fitness and propriety of the ownership of Sky, Leveson 2 should go ahead without delay.

As we have all discovered to our cost, these are very serious issues, which, in their impact on every aspect of public life, could have enormous and unexpected consequences. I cannot have been the only person on these Benches who experienced a brief flutter of hope when, following the nightmarish divisions of Brexit, on the morning of 13 July I heard the newly installed Prime Minister say:

“The Government I lead will be driven not by the interests of the privileged few, but by yours … When we take the big calls, we’ll think not of the powerful, but you. When we pass new laws, we’ll listen not to the mighty but to you. When it comes to taxes, we’ll prioritise not the wealthy, but you. When it comes to opportunity, we won’t entrench the advantages of the fortunate few”.

Her Government’s first pledge to this nation was not to be at the beck and call of the powerful, the mighty or the wealthy, or to entrench the advantages of the fortunate.

I want with all my heart to believe that the Prime Minister believed what she said that day and that she and her colleagues in government are prepared to live by it. When she used the words “you” and “yours”, I assumed that she meant the public—those citizens referred to on the very first line of Ofcom’s duties. By accepting these amendments—or, far better still, coming back with wording that clarifies while offering the same intent—the Government will prove that, where media ownership is concerned, they have no intention of following the dismal example of so many of their predecessors, including, I am sad to say, the Government of which I played a very small part, who entrenched the advantages of the fortunate few. Should they fail to do so, they will have fallen at the very first hurdle they set themselves, and possibly never recover the public’s trust. I beg to move.