I beg to move amendment No. 19, in page 10, line 42, at end add—
'and such grants shall be sufficient to enable OFCOM adequately to fulfil its statutory functions; and to employ sufficient staff for that purpose.'.
It gives me particular pleasure to welcome you to the Chair of the Committee, Mr. Stevenson, in view of our long and continuing partnership in other places. I look forward to working under your chairmanship.
It gives me almost as much pleasure to move amendment No. 19, which is self-explanatory. It requests that such grants as are made available should be sufficient to enable Ofcom to fulfil its statutory functions adequately and to employ sufficient staff. It may help the Committee if I explain the background to the amendment, which comes from several representations received during the consultation on the White Paper and the run-up to the Bill's Committee stage.
Centrica said that Ofcom would need to be properly resourced, and its response to the consultation on the White Paper highlighted the difficulties presented by the high staff turnover at the Office of Telecommunications. We should learn from that experience that Ofcom's structure must generate sufficient interest, enthusiasm and dynamism to attract the right type of person, and that it will have sufficient resources. I am sure that we shall discuss that when we consider the money resolution attached to the Bill. It is important that we attract the right calibre of staff, that we have sufficient staff and that sufficient grants are extended to Ofcom to enable it to fulfil its statutory functions.
I am mindful of the fact that the better regulation taskforce has reported that there should be less regulation. Hopefully, Ofcom will apply a light touch. The Bill replaces five regulators with only one. In earlier amendments we reflected on Ofcom's remit, discussed the structure of the board, and considered how executive and non-executive members will be appointed to the board, so it is appropriate to consider whether there will be sufficient staff and an adequate support structure.
The amendment is designed to probe the Minister on a matter to which his Department has given considerable consideration. I know that he will consider this part of the Bill at some length in his response. Will he take the opportunity to share with the Committee the nature of the grants, how long they will apply and the sums involved? Finally, will he say how large Ofcom's staff is intended to be?
May I say what a pleasure it is to be chaired by you, Mr. Stevenson? I
feel that we are a little Staffordshire coterie here in the Committee.
I rise to support the amendment moved by my hon. Friend the Member for Vale of York (Miss McIntosh). I suspect that the Minister will say that it is unnecessary because the schedule already states that there will be sufficient sums as the Secretary of State, or perhaps the Chancellor of the Exchequer,
may think fit for the purpose of enabling OFCOM to incur or meet liabilities in respect of capital and revenue expenditure.
I think it right, however, that my hon. Friend has tabled the amendment. As she has pointed out, some of the organisations that will be incorporated into Ofcom are not necessarily happy ships, if ships' happiness is measured by staff turnover.
I am not sure what the situation is in Oftel. It certainly contrasts with the Radio Authority, which is a very tight ship on which staff serve for many years. David Vick, its deputy chief executive, came from the radio division of the old Independent Broadcasting Authority; he has been there for the Radio Authority's whole life, as has Tony Stoller, its chief executive.
As the schedule stands, the Secretary of State and the Treasury will be tempted to make provision only for the bare minimum of services that Ofcom will provide, especially as the paving Bill deals only with the shell organisation of Ofcom. Shell or not, Ofcom will have important functions to perform, especially in liaison with the organisations that it will eventually absorb if the main communications Bill is enacted. Continuity is therefore needed. That can be maintained only if there is longevity of staff. If only the bare minimum is maintained in the operation of the shell organisation, there may be a lack of continuity through staff leaving. That would be a shame.
The amendment points out that money must be available for Ofcom not only
to fulfil its statutory functions,
which is to some extent included in the Bill, but
to employ sufficient staff for that purpose.
One might ask whether high staff turnover in Oftel has been caused by its having insufficient staff and people feeling that they are overworked, abused and not appreciated as much as they should be. We Members of Parliament should all understand that: we too are overworked and not appreciated as much as we should be.
I hope that the Committee will support the amendment and that the Minister will not fall back on his little piece of paper from his officials and say simply that the amendment is redundant because its purpose is already covered in the schedule.
I, too, welcome you to the Chair, Mr. Stevenson.
Perhaps it would be convenient if I explain to the Committee how the Government envisage the funding of Ofcom during its initial stages. The general approach for sectoral regulators is that the cost should be borne by the sector concerned. That is
how things have worked until now and how we envisage they will work in the future. In other words, regulation is part of the cost of doing business, and anyone with experience of working in those sectors knows that that is how existing regimes are financed.
We will set out powers to charge fees in the main communications Bill. For the anoraks among us, only half the cost of the Broadcasting Standards Commission, which is financed in a slightly different way, is involved. Ofcom will need to consider the best way to levy the regulated part of the communications sector, and how to avoid as far as possible cross-subsidy between one part and another, so that the burden on individual businesses is fair. I expect the Ofcom board, once appointed, to address that issue and to present its proposals publicly. In general, there will be little or no need for grants once Ofcom is regulating.
During the preparatory stage, however, Ofcom will have no statutory income. The Government believe that the extra costs of creating Ofcom should be borne by the sector. It makes more sense for Ofcom to be financed by businesses that are in the sector when the new regime comes into force than by those that are in it today. We envisage that all, or almost all, of the costs of transition will be financed by a loan to Ofcom from the Secretary of State. That loan will be paid back by Ofcom out of the fee income that it will start to receive once it moves into the regulatory stage.
I appreciate the time that the Minister is taking to explain this. Although he is right to say that once Ofcom is up and running it should be funded by the sector that it regulates—that is normal—the method of funding that he proposes is abnormal. Is it not double-counting? Is he not asking a sector that is already suffering from lack of advertising receipts to support not only the Independent Television Commission and the Radio Authority, but the shell Ofcom organisation?
No, it is not double-counting. I am talking about the additional costs of setting up a body of which the entire industry is in favour. It wants Ofcom to happen, but it does not assume that it will get a free ride; it knows that it will have to pay. The hon. Gentleman may think that the taxpayer should pay for it—
Michael Fabricant indicated dissent.
Well, that is what is he is saying. I am not saying that the taxpayer should pay for it. I am saying that the sector should pay for it.
I am pleased that Opposition Members want to ensure that Ofcom has adequate funds to fulfil its functions. The hon. Gentleman is right to argue that Ofcom and its constituent parts should have the self-confidence to retain its staff and the resources to ensure continuity. As I have told the Committee several times, I am absolutely determined that the creature we are creating will not immediately assume any of the regulatory powers that are currently undertaken by the existing regulators. The staff who work in their offices should not feel that their jobs are
threatened by the advent of Ofcom. It will assume a regulatory role only after Royal Assent to the main and substantive communications Bill.
Grants are not the way to achieve our objective. It will be for Ofcom to consider during the preparatory stage what it needs to cover the cost of preparation and to negotiate a loan from the Secretary of State to cover that. Once it enters the regulatory stage, it will need to set statutory fees at a level that covers the cost of the resources that it needs to regulate. Ofcom will be obliged to consider carefully both the costs needed and the level of fees required. The paving Bill provides for that in paragraph 8 of the schedule.
Ofcom will not be able to adopt a cavalier attitude to costs—its accounts will be subject to the National Audit Office, and the Public Accounts Committee will be able to examine them. The way in which it sets fees will be subject to judicial review. In due course the House will be able to consider the provisions on funding in the draft of the main Bill.
I am following the Minister's argument with great interest. He is talking about the amount of payment that will be made by those who are regulated. Can he give some idea of the basis on which the interest rates that will be charged to Ofcom will be set, as that will be significant when it eventually recovers the moneys from the bodies that it is regulating?
I assume that the interest rates will be similar to those that apply when grants and loans are given on a normal day-to-day basis by any Government Department, but I will find out for the hon. Gentleman what rates are envisaged.
The House will be able to consider the provisions on funding in due course. In the meantime, I hope that my explanation of the principles governing the funding of Ofcom will persuade the hon. Member for Vale of York to withdraw her amendment.
Unfortunately, the reverse is true. I am deeply alarmed by what the Minister has recounted, especially in response to the additional questioning by my hon. Friend the Member for Lichfield (Michael Fabricant).
There is concern about the lack of clarity in the Bill, and the Minister has contradicted himself slightly. Paragraph 9 states that grants may be extended as the Secretary of State thinks fit, to enable Ofcom
to incur or meet liabilities in respect of capital and revenue expenditure.
Grants under this paragraph shall be paid out of money provided by Parliament.
Paragraph 10 states:
Moreover, those sums are to be repaid to the Secretary of State at such times as he directs.
Orange has said that the merging of five regulatory bodies into one should create significant operational cost-saving synergies for the communications
industries. In its view, the Bill is insufficiently clear in that respect. How will staffing be administered? I do not remember hearing the Minister say how many members of staff are envisaged. The Bill suggests how many board members are envisaged. Will the Minister provide clarification?
The amendments are rather more meaty than those we have just considered. Mr. Stevenson, were the amendments pressed, could they both be put to a vote, or must I wait?
I am grateful for that clarification. The lead amendment would ensure that every statement of accounts is sent not only to those envisaged in the Bill, but to the Public Accounts Committee of the House of Commons. That struck a chord with those who made representations and were consulted during the White Paper process. When considering a public agency, albeit an independent one, it is important that the relevant Select Committee has the opportunity to scrutinise accounts.
Amendment No. 24 asks that Ofcom's annual reports be referred to the relevant Select Committee or Committees of each House and be debated there. The reason why I have encompassed in the amendment a reference to two Select Committees is because two Departments are creating the Bill and will create and consider the future communications Bill. If there is to be an annual report of Ofcom, it should
therefore be referred to, debated and voted on by a full sitting of the House.
There are two relevant Select Committees, on Culture, Media and Sport and on Trade and Industry. I pray in aid the excellent Select Committee report to which my hon. Friend the Member for Lichfield and other distinguished hon. Members contributed. Over lunch, I had the opportunity to discuss it at some length with the right hon. Member for Manchester, Gorton (Mr. Kaufman). The report categorically recommended that an annual report be referred to the Select Committees. It states:
We consider that close scrutiny of the establishment of the new regulator and its work will be a crucial task for the relevant select committee or select committees of the House of Commons in the next Parliament.
My proposal is that once Ofcom has been established, and even before the main communications Bill—I have called it the mother of all Bills—has secured its passage through Parliament, it is right and proper that the provision on annual reports in paragraph 12 of the schedule encompasses the possibility of a lengthy and full debate in the Select Committees and on the Floor of the House.
In respect of accounts being sent to the Public Accounts Committee, I was alarmed by the Minister's reply to amendment No. 19, so it is extremely important that we consider the cost, value, savings and running costs of Ofcom, and that we are able to compare them with the running costs of the five constituent parts that will be replaced. Many bodies enthusiastically embraced that idea in consultation on and submissions to the White Paper. The Campaign for Press and Broadcasting Freedom said that there should be transparency in Ofcom's operations and accountability for its actions. The amendments will go some way toward enabling the House, through the Select Committee system, to hold Ofcom to account.
I also hope that, especially through the two Select Committees debating the annual report, we will be able to ensure Ofcom's total independence of the two Departments concerned.
I rise to support the amendments. My colleague the hon. Member for Sheffield, Hallam (Mr. Allan) and I tabled an amendment suggesting that something similar should happen every six months during the interim period. We have some anxieties about setting up the shadow Ofcom without Parliament retaining the ability to comment on its initial decisions.
Much of the politics and many of the key decisions are, rightly, being put off until the communications Bill provides the opportunity for Parliament to debate them in detail. My concern is that some of the decisions that will fashion Ofcom—what it is, what it will become, and how it will operate for some years—will probably be taken during the interim period by the shadow body itself. For that reason, I favour Parliament retaining the ability to comment on and have some say in those decisions in the early days. To bring Ofcom's first appointees before the Culture, Media and Sport Committee would be advantageous. Those people would find that a useful baptism—in
fact, knowing the character of that Committee, it might be something of a blooding.
The hon. Member for Vale of York questioned the Minister about the size of the new Ofcom, and the Minister replied that the total number of staff in the existing regulators was 1,111. I would be absolutely horrified if Ofcom's long-term staffing levels were to approach that number. In that sense, I found the potential scope of the project quite worrying. I would also be horrified were Ofcom to divide into operating departments along the lines of the existing bodies, as that would defeat the entire purpose of setting it up. It is essential that the new body's employees do not continue to think in their old boxes.
Does the hon. Gentleman accept that one of the biggest obstacles to light-touch regulation is the dead hand of the Public Accounts Committee, which restricts innovation? The fears he expresses are precisely the sort of recommendation that might come from that Committee, which would prevent the innovation and light-touch regulation that we demand from Ofcom.
I accept that the Public Accounts Committee sometimes has that effect, although I do not think it inevitable. However, the hon. Gentleman makes a useful point. I suppose that I am speaking in favour of the second of the two amendments.
It is important that the shadow body is set up in a joined-up way. It needs an economics and competition department and a technical department. We shall discuss consumer issues later. If it is to have such departments, the early decisions will be critical in fashioning what Ofcom will become.
I am sure that the hon. Gentleman agrees that the existing regulators are not halfwits. Of course those sections and departments will be set up, and we can get some notion of how Ofcom will look even from this Bill. However, its final appearance will be set out in the communications Bill. If the hon. Gentleman is so concerned, why did he just vote for an amendment that simply said that
such grants shall be sufficient to enable OFCOM adequately to fulfil its statutory functions; and to employ sufficient staff for that purpose?
There would be no regulation or control over that whatsoever. If that is not contradictory, I do not know what is.
It is not contradictory at all. Establishing an adequate staff does not mean that there must be 1,111 members of staff, nor did the amendment say that the grant must pay for all the staff. The previous amendment expected that it would possible to levy the industry, but would have ensured that the grant was capable of supplementing a levy to enable Ofcom to do its task.
I dispute that to enable Ofcom to perform its tasks it is necessary for it to be anywhere near the size of body that would emerge if we simply amalgamated the five existing bodies. I do not believe that we will do
that, but, to answer the Minister's point, it is not halfwits that I fear. Of course the existing regulators are not halfwits. I fear far more the prospect of people protecting their own turf, protecting their empires, protecting their colleagues, and sticking to their old ways.
Order. The amendments are about audit and annual reports. I am a little worried that we are stretching the debate wide of the amendments, so if we could return to those issues, I should be grateful.
I am sorry, Mr. Stevenson, but my view is that the only opportunity for Parliament to have any further involvement in some of the key decisions made during the interim period until the communications Bill becomes an Act and the body begins to take its long-term shape is for the Select Committees to receive Ofcom's annual report. I cannot think of any mechanism other than having Ofcom come before a Select Committee of the House to report on the early decisions that it is taking, so that Parliament has an opportunity to comment on them.
Whether or not the last amendment was made, surely the sum going to Ofcom is open ended? It is open ended in the clause. Either way, is not the need for the Public Accounts Committee to consider the issue proved? If I may put a second point briefly, we keep hearing Government Members say that there should be light regulatory control—but has not yet been established, because we have not heard from Ministers what Ofcom will do.
I will not be drawn on the second point, save to say that the Government's response is likely to be that the matter will be dealt with in the communications Bill. That is right. I am not particularly sympathetic to the endeavours of the hon. Gentleman and some of his hon. Friends to introduce matters that should be in the communications Bill into this paving Bill. However, I believe that during the interim period it would be useful for Parliament to retain an ability to comment on some of the initial administrative decisions. An annual report and oversight by the Public Accounts Committee would be the best way to do that.
As I did this morning, I rise to support this group of amendments a little half-heartedly—or perhaps I should say three quarters-heartedly, because, although I support amendment No. 23 fully, I support only a part of amendment No. 24, on a technical notion that I shall point out shortly.
As hon. Members have said, there must be a mechanism by which the shell Ofcom can be monitored, and perhaps the most effective mechanism would be the Select Committee. We had an interesting debate last Thursday about the possible role of Select Committees in the selection of the chairman, deputy chairman and other commissioners.
It is most important that the Select Committee on Culture, Media and Sport, together with the Select Committee on Trade and Industry's Select Committee, should have an opportunity to look at the Ofcom committees' workings when Ofcom has been
established. However, it quite often happens that the Culture, Media and Sport Committee produces a report—as it did on the provisions of the White Paper—and then receives an appalling response from the Department. Indeed, a former Culture, Media and Sport Minister commented that the Department was dysfunctional. Were it were not for the Select Committee, it would not do half as good a job as it does at present. Some would say that it is doing half a bad job, but that is beside the point. Therefore, I certainly support amendment No. 23, which would ensure that reports are given regularly to the Public Accounts Committee.
It may be argued that even the shell organisation will have to be funded by those whom it will in due course regulate, because, as we now learn, it will have to pay back the loan from the Secretary of State at an interest rate that we do not know. The shell organisation is a Government agency, and it is right and proper that the Public Accounts Committee has access to it.
I thank my hon. Friend for giving way. Is he aware of the concerns of the ITV network about Ofcom resourcing? It feels that
OFCOM should have sufficient resources—
a rather unqualified term in this context—
to recruit and retain the very best staff with expertise across all necessary fields. However, OFCOM should also be required to produce—
My hon. Friend makes a powerful and cogent point. She is absolutely right: the regulators should be regulated, in part, by the House.
For too long, Governments have washed their hands of agencies saying ''not me, guv''. We have had five years of that. The Select Committee and the Public Accounts Committee should have an opportunity to review the work of Ofcom.
I disagree to some extent with amendment No. 24, although some might ask why I disagree with my charming and my hon. Friend the Member for Vale of York. I might seek your advice on this point, Mr. Stevenson. The amendment, which is clearly in order or it would not have been tabled or selected by you, states that the issues shall be debated by each House of Parliament. However, I wonder whether an Act of Parliament can bind the House of Commons in its work. If the amendment were passed, it would bind the House to debate the reports issued by Ofcom. That would be a gross breach of the legislature. I would welcome an intervention to clarify that.
In the interests of clarity and to help my hon. Friend, the schedule currently states that a copy of the statement and the report shall be laid
before each House of Parliament. Paragraph 12 adds that the Secretary of State shall lay a copy of every annual report before each House. I am surprised by the mischievous line taken by my hon. Friend, given that the Select Committee of which he is a member called for such a procedure.
Does the hon. Gentleman recall that the Conservative Government, in buying off the Maastricht rebels, conceded the principle that there had to be an annual debate on the state of the European Union?
Order. I need hon. Members' help if we are to make the Committee a success, as I am sure we will. Maastricht and the European Union are irrelevant to the amendments.
Thank you, Mr. Stevenson. I understand the point made by the hon. Member for North Devon (Nick Harvey), but I am not sure that the House feels itself to be so bound—I am unsure whether there is a debate every year. If that is the case, it must be said that the provision has no meaning, and I am uncomfortable with amendment No. 24 for that reason.
I support the observation made by the hon. Member for North Devon about the number of people to be employed by Ofcom. Will the Minister indicate to the Committee whether he envisages that Ofcom will employ 1,111 people? If it does, it will be nothing like the Federal Communications Commission, which employs a tiny fraction of that number. He said earlier that the FCC was a good model to follow because it is a light regulator, but if 1,111 people are to be employed, they will want to be employed, and that means they will regulate.
On Thursday the Minister rightly chastised me for accidentally using the word ''regulate''. There is a danger that far from creating a light touch regime, we shall end up with Ofcom becoming a mighty interventionist behemoth.
I love that word—behemoth. We sometimes call them ''beer moths''.
I appreciate the intention behind the amendments, but it is a matter of striking a balance between ensuring that Ofcom is able to operate and take decisions without interference from Government or Parliament and ensuring that there is proper scrutiny of its activities. The provisions in the Bill achieve the right balance.
Members of the Committee will recall that the Government have already undertaken in another place to report periodically to Parliament on Ofcom's
progress. There is nothing to prevent the Culture, Media and Sport Committee inquiring into its progress. The hon. Member for Lichfield who, like some of my hon. Friends, is a member of that Committee will know that its Chairman is never reluctant to call in whomever he thinks fit. My hon. Friend the Member for Ochil (Mr. O'Neill), Chairman of the Trade and Industry Committee, takes a similar approach. Both Chairmen regularly conduct vigorous inquiries. As one who did three and a half years on the Public Accounts Committee, I know that time is regularly set aside for hon. Members to debate on the Floor of the House matters raised by its Chairman. We have seen that the proper route for scrutiny of Ofcom's expenditure is the National Audit Office and the Comptroller and Auditor General.
That process is commonly used. It is similar to that used for the Broadcasting Standards Council, Oftel and the Ofgem—the Office of Gas and Electricity Markets—and it provides Parliament with an opportunity to scrutinise the statement and the Comptroller and Auditor General's report together. The Public Accounts Committee is able to examine any statement of accounts laid before Parliament in that way. Having sat in that Committee on many occasions and seen before it people whom I now regard in a more favourable light than I did when I was in opposition—namely, the poor officials who must appear before the Committee—I know that there are no rules of engagement. I have seen some strong, arrogant characters go down on all fours.
There is no need to specify that in addition to the Secretary of State and the Comptroller and Auditor General, the Public Accounts Committee should be sent a copy of the accounts. For that Committee to receive Ofcom's unaudited accounts would not assist its scrutiny. As the hon. Member for Vale of York said, paragraph 12(3) provides for the Secretary of State to lay copies of the annual report before each House. It is a matter for the relevant Select Committees and Parliament to determine what they want to do once the reports have been laid, and the Bill is certainly not the place to determine that each House must debate the report.
I do not want to be unkind or cruel to the Minister, but his Department's response to the Select Committee report was deemed so deficient that I understand from the right hon. Member for Manchester, Gorton that that is why the Committee will take further evidence, which is something that we heard from my hon. Friend the Member for Lichfield.
I draw the Committee's attention to the fact that in considering the White Paper the Select Committee went on record, stating:
close scrutiny of the establishment of the new regulator and its work will be a crucial task for the relevant select committee or select committees of the House of Commons in the next Parliament.
The amendments would extend the Select Committee structure to embrace the House of Lords, which should have a role because the Bill started in that place, and its Select Committees that shadow the two responsible Departments should take a view.
In my limited experience of the House of Commons, it is unusual to have responsibility split between two Departments, which is why the Select Committee called for a single ''Department of Communications''. I invite the Minister and his Department to consider whether it would be more appropriate to have a single Department with responsibility for communications.
The communications industry is growing and it makes a massive contribution to this country. I repeat that it is entirely appropriate for the Public Accounts Committee on which the Minister had the honour to serve—I am sure that he served with great distinction—to consider the Ofcom statements rather than, as the schedule currently states, copies of the Comptroller and Auditor General's statement and report being laid before both Houses of Parliament.
The Minister's response to the debate is deficient because everybody is concerned about the monolithic new regulator that the Bill creates. He said that the five existing bodies employ 1,111 employees and have a budget of £118 million. Despite my specific question, Ofcom's staffing levels once it is set up remain unclear. That is exactly the sort of question that both Select Committees would want to put. Having debated them at some length, I prefer to return to these issues at a later stage than to press the amendment to a vote. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendment proposed: No. 51, in page 12, line 22, at end insert—
'( ) OFCOM shall establish—
(a) a Welsh Advisory Committee which shall advise OFCOM on the carrying out of its functions in Wales; and
(b) a Scottish Advisory Committee which shall advise OFCOM on the carrying out of its functions in Scotland and shall, in appointing these Committees, consult the National Assembly for Wales and the Scottish Parliament.'.—[Nick Harvey.]
Question, That the amendment be made, put and negatived.
I beg to move amendment No. 32, in page 12, line 25, at end insert—
(2) Members will be appointed for four year terms and shall serve a maximum of two consecutive terms.
(3) Paragraphs 17, 18 and 19 of the Schedule shall apply to the proceedings of the Consumer Panel, but paragraphs 15 and 16 shall not apply and the Consumer Panel shall make other such arrangements for regulating their own procedure as they think fit.
(4) The Consumer Panel shall—
(a) research consumers' views and concerns on issues relating to OFCOM's functions,
(b) publish its advice, conclusions and reports to OFCOM,
(c) take due account in its work of the views of consumers with special needs, including those on low incomes or with disabilities
(5) The Consumer Panel shall be funded by means of grants from OFCOM.
(6) The Consumer Panel shall make an annual report of its proceedings and financial position to each House of Parliament.'.
With this we may discuss the following amendments: No. 50, in page 12, line 25, at end insert—
(2) Their members shall not be members, employees or past members or employees of OFCOM.
(3) The consumer panels shall
(a) research consumers' views and concerns on issues relating to OFCOM's functions,
(b) publish their advice, conclusions and reports to OFCOM,
(c) take due account in their work of the views and needs of consumers with particular needs, including those on low incomes or with disabilities.
(4) The consumer panels shall be funded by means of grants from the Secretary of State.
(5) The consumer panels shall make an annual report to each House of Parliament and the devolved governments of Wales, Scotland and Northern Ireland.'.
No. 27, in clause 2, page 2, line 24, at end insert—
'(1A) It shall be the duty of OFCOM to have regard to the work of their Consumer Panel in carrying out their function under subsection (1).'.
In moving the amendment I shall refer to a substantial amount of work that has been done by other bodies and evidence that was given as part of the consultation process.
Amendment No. 32 is pertinent because a consumer panel with 10 members should be set up by Ofcom comprising people who are neither its members nor its employees. On the same basis, it should be a duty of Ofcom to have regard to the work of the consumer panel in carrying out its functions under the relevant subsection of the Bill.
The Select Committee considered at length the proposal to set up a consumer panel. Paragraph 7.4 on page 72 of the White Paper refers to Ofcom's consumer protection role and states:
OFCOM will have a principal duty to protect the interests of consumers and will have powers to take action if the industry does not develop an effective consumer protection regime.
Paragraph 7.4.3 states that the Government
will give OFCOM powers to institute mechanisms for consumer protection if the industry fails to develop a code or codes on service delivery which satisfy all the consumer protection requirements set out in the previous section.
Paragraph 7.5 states that the Government
will establish a new consumer panel to advise the regulator. It will be able to research consumer views and concerns on service delivery, represent these concerns to OFCOM and other relevant bodies, and publish its findings and conclusions.
Paragraph 7.5.1 states:
The panel should be independently appointed to advise OFCOM on these issues.
Curiously, however, there is no mention of a consultative panel in the Bill.
I am sure that the Minister has been waiting for this opportunity to explain to the Committee and the wider audience why the Government have so singularly
failed to act on what they so specifically referred to in the White Paper. Judging by the overwhelming response to the consultation, there is clearly a need for a consumer panel. That response was encapsulated in the Government's response to the Select Committee report which states:
We welcome and support the proposal to establish a consumer panel. We recommend that the panel be empowered to examine and to seek to represent the interests of all consumers and potential consumers and not be narrowly confined to issues of service delivery for customers with a financial relationship to service providers.
During the 10 years that I was a Member of the European Parliament, the late Mary Whitehouse was my constituent. One reason why having a consumer panel is so important is that the views that were previously expressed by her could be expressed through such a panel.
The National Consumer Council—the hon. Gentleman would do well to read its words; then, he might like to contribute to the debate—calls for a stronger voice for consumers in the communications sector to ensure that their views are heard by decision makers. The council welcomed the Government's commitment in the White Paper to establish a communications consumer panel. It is now asking—I am acting as the voice of consumers—
Indeed, and it is a broad responsibility.
The National Consumer Council now asks the Minister to say that the proposal is being developed to ensure that such a consumer panel can effectively and independently represent consumers' interests. It would have been pertinent if the Bill had stated that. I invite the Minister to support our two modest amendments, Nos. 32 and 27, and to admit that it was remiss for the Bill not to refer to the consumer panel.
When considering the structure of Ofcom, it is appropriate to consider structures within it such as a consultative panel for consumers. I ask the Minister to reconsider the matter, perhaps on Third Reading, although if I am overwhelmed by his support for the amendments, that may be unnecessary. The Bill should not only refer to a consumer panel, but give an idea of its terms of reference. I urge the Minister to give an assurance that such a panel would be adequately resourced and capable of engaging with and influencing the full range of stakeholders. That is one of the Government's favourite words, so I hope that the Minister will be even more obliged, persuaded and seduced to accept the amendments.
I hope that he will also take the opportunity to confirm that the consumer consultative panel that both his Department and the Department of Trade and Industry said in the White Paper that they were minded to introduce would be completely independent of Ofcom and partisan only to the extent that it could set its own agenda and promote its own views on behalf of the consumer interest. It is important to emphasise that the consumer interest should cover which services are delivered as well as how they are
delivered. Access is obviously important, but consumers should be allowed to ask, ''Access to what?'' The White Paper implies an artificial restriction on the panel's remit, and the Bill is completely silent about that: for example, would it include the BBC, as the National Consumer Council fervently wishes it would, where there is a specific consumer interest?
I am fascinated by the hon. Lady's views. She is obviously aware that these matters were debated in relation to the Financial Services Authority and Ofgem, both of which work reasonably well in slightly different ways. Why does she think that her proposal is better?
I would be delighted to speak at greater length, but I fear, Mr. Stevenson, that you would rule me out of order if I diverted to consider utilities, which are not within this Committee's remit.
Given the persuasive contribution that the National Consumer Council made to the debate on the consumer panel, and the fact that the Government's own White Paper devoted a whole chapter to it and gained the support of the Select Committee, I do not beg, but plead—seduce, even—the Minister to reverse the omission and accept the amendments.
I support the aims of the amendments, because there is a distinct role for a body of opinion representing the consumer interest. Much of our debate is founded on the assumption that we are talking only about television, but I shall give a slightly different example.
Oftel has been determined that the introduction of broadband internet in this country should happen in a perfectly competitive way. It is slavishly obsessed with the idea that it must follow a textbook model of competition theory. I sometimes feel that it would purr contentedly if only 100 people in the entire country were connected, so long as it was through five suppliers, each with 20 per cent. of the market. The consumer interest can, however, be quite different. It is the consumer interest to get far more people connected to broadband.
Ofcom is being given two objectives: to look at competition issues and to look at consumer issues. Those may benefit from having an independent consumer voice, and I strongly support the hon. Lady's aim. She asks whether this is the point to achieve it, and, seeing that the Bill considers Ofcom's structures, says, ''Yes, it is.'' There is a logic to that. However, a case could equally be made that we do not desperately need a consumer panel during the interim phase when Ofcom will function as a shadow authority. The Minister may say that that can be looked at later, and I hope that he will.
Does the hon. Gentleman agree that, such is the purpose of the Bill, we cannot discuss the policy, role or functions of the new regulator? We can rightly discuss the structure and mechanism of Ofcom. It is a gross omission not to introduce a
consumer consultative panel in a whole chapter devoted to the role of consumer protection. We will be ruled out of order by you, Mr. Stevenson, or by whomever the Chairman is, if we raise that under the communications Bill.
It would be perfectly possible for the Government to include in the communications Bill some amendments covering the way in which Ofcom is set up, and to add a consumer voice to its organisational apparatus at that time, should they wish. However, I hope that the reason why that is omitted from this Bill is that the consumer voice does not necessarily need to be part of Ofcom.
Let us look at other regulatory apparatus set up over time. In one of the first privatisations, a separate, self-standing Gas Consumers Council was set up. Later regulators had consumer panels of the sort that the hon. Lady now proposes within the regulatory bodies, such as the customer services committee in the Office of Water Services. There was similar representation in the Office of Electricity Regulation, the old electricity regulator. In my view, those were far less effective than the Gas Consumers Council as a self-standing body. I hope that the Minister will tell us that the reason for what the hon. Lady calls an ''omission'' is that a different model will be introduced.
I can set the hon. Gentleman's mind at rest. The panel will not be a committee of Ofcom. It will not take decisions on Ofcom's behalf, but will be independent of it. The main Bill is the proper place to address that, as the hon. Gentleman said.
My hon. Friend the Member for Vale of York has certainly seduced me, because I can support the amendments wholeheartedly. I believe that, despite the comments of the hon. Member for North Devon and the Minister, this is the right place to include such provision in the Bill.
The Government made a clear commitment in their White Paper and should be held to their promises. Some may argue, and the Minister certainly will, that this is not the place to include the provision, because this is just a shell organisation. However, he said on Thursday that the shape of Ofcom will be largely determined by the shell Ofcom. Having no consumer interest would be damaging. It is not often that one sees total agreement between the National Consumer Council and the Consumers Association. However, they both argue that the provisions should be included in the Bill.
I was perfectly happy when the Minister said to the hon. Member for North Devon that the consumer panel would operate separately from Ofcom. I do not agree when he says that it should not be included in the shell organisation. The shell organisation will have to liaise with the existing bodies that it is designed to replace. It will discuss the future structure of Ofcom with those 1,111 people. Having made a commitment in the White Paper that consumer interest should be
taken into account, how can the Government do that if the consumer panel is not in direct communication with the shell office of communications?
I do not know whether my hon. Friend the Member for Vale of York will press the amendment to a Division. I hope that she does, unless the Minister is equally seduced by my hon. Friend's arguments. It is reasonable to expect Ofcom to establish a consumer panel of 10 members. My hon. Friend is right to say that those persons should be neither members nor employees of Ofcom. As the Minister said, the panel must be independent of Ofcom.
There is a neat symmetry in proposed paragraph 14A(2), in which my hon. Friend proposes that the appointment be for four-year terms, and that a maximum of two consecutive terms will be served. I do not want to repeat the arguments I gave this morning about the congressional amendment to the number of terms that the President of the United States can serve. I would go into considerable detail about proposed sub-paragraph (3), but I have not quite followed it.
Proposed sub-paragraph (4) states:
The Consumer Panel shall—
(a) research consumers' views and concerns on issues relating to OFCOM's functions.
That would create a consumer panel that is more than a passive body that receives representations from those affected by the organisations regulated by Ofcom. There I go again, using the word ''regulation'', but I fall into that trap with the thought of 1,111 people being employed by Ofcom.
My hon. Friend has proposed wisely and seductively that the panel should undertake research. Part of the reason for incorporating such a change is to establish sufficient resources for the panel to undertake the research. Will that be funded by a loan; if so, what will be the interest rate? I look forward to receiving the Minister's letter on that point. I suggest that he circulate it throughout the Committee. The consumer panel should publish its advice, conclusions and reports to Ofcom. I was going to say that the panel should lay its reports before Parliament, but that is contained in proposed sub-paragraph (6).
That is interesting. The Minister is right. I have been listening to the arguments and I am not a signatory to the amendment. It could be asked why I wholeheartedly support the amendment. It is because the arguments presented by my hon. Friend the Member for Vale of York were so powerful and so seductively presented. Sub-paragraph (5) says:
The Consumer Panel shall be funded by means of grants from OFCOM.
That is interesting, particularly with regard to the way in which Ofcom itself will be funded, which sounds to me like a double whammy against ITV and the other organisations that it will regulate.
Amendment No. 27 is most important. At present, even if a consumer panel were established, Ofcom could ignore its findings. Yet amendment No. 27 says that Ofcom must ''have regard'' to its work. Does my
hon. Friend the Member for Vale of York expect that, if Ofcom has regard, it will have an obligation to comment on the panel's work in its annual report? Therefore, although Ofcom may not accept all the panel's recommendations, it would have to say, before the House, why it does or not do so.
I am grateful to my hon. Friend for her helpful intervention. She logically argues the case for that position.
I would not be able to understand it if the Minister were to stand up now and say that he rejects the two amendments. If he were to say that, it would be a slap in the face not only for the National Consumer Council and the Consumers Association, but for all those who watch television, listen to the radio or use the internet.
I support the two amendments. I realise that this is not the appropriate place in which to speculate on the possible composition of such a consumer panel, but I hope that the Minister will agree at this sitting to its establishment in principle. I imagine that the possible composition will be a matter of detailed discussion, because radio covers a wide spectrum, quite apart from the other elements of telecommunications and broadcasting. Therefore, I hope that the idea in principle of the panel can be accepted now and the content can be discussed at another time.
I am grateful for the Minister's support. The relationship between the consumer panel and Ofcom will be important, particularly in view of Ofcom's small size and, as was said this morning, the possibly limited range of interests that would prevail if Ofcom had only three members, or even six. This is an opportunity to widen its expertise and interests on behalf of consumers, which will be of great value.
Much that I meant to say has been said, so I shall be brief. If it is important for Ofcom to exist before the main Bill has been considered and we know what it will do, it is important to establish the consumer panel alongside it.
As my hon. Friend the Member for Vale of York said, through this Bill we are establishing the structure of Ofcom, which will deal with as yet unknown matters. The structure is important. I have said many times that the main interests to be looked after by Ofcom are those of the consumers. We need to protect the interests of industry because it employs many people and is important, but the impact of Ofcom on consumers is even more important. The influence of the media on children, young people and even older people cannot be underestimated, so we need to achieve, as the White Paper says, a balance between
freedom, decency and quality. However, who decides how, and whether, that balance is achieved? We need a strong consumer panel for that.
A consumer panel could consider the standards of programmes and the decency on television screens, but it could also look at the proliferation of the internet, telephone masts and mobile telephones, at safety aspects and at a great many other elements. To convince hon. Members that a useful service is being served by considering the Bill, I ask the Minister not to wait for the main Bill. We are setting up something that is important, and, to their credit, the Government give great coverage in the White Paper to the importance of setting up a consumer council:
We will establish a new consumer panel to advise the regulator.
That seems clear, so let us have the details now.
It is good to hear from my old friends on the National Consumer Council, albeit through the lovely lips of the hon. Lady—[Interruption.] There is so much talk of seduction.
As a former Consumer Affairs Minister, I am mindful of the need to ensure that the consumer voice is clearly heard. However, the Bill is not the place to set up a blueprint for how best to do that, and I will not attempt to make it so. Hon. Members must bear it in mind that the Bill confers just a single function on Ofcom. [Interruption.] I hope that my hon. Friend the Member for Hampstead and Highgate (Glenda Jackson) does not fall asleep. The Bill will prepare Ofcom to take on other functions.
Ofcom will not be regulating at this stage and, although advice to the consumer panel may be valuable in future, it is not particularly relevant now in assisting Ofcom to prepare for the transfer of its staff and other assets and liabilities from the existing regulators. It is therefore not appropriate to place Ofcom under a duty to have regard for the work of the panel, as proposed by amendment No. 27. I oppose the amendment.
Having championed consumer affairs to the Minister, I am extremely disappointed by his remarks, in spite of his complimentary remarks earlier in debate. I cannot understand why he feels that this is not the appropriate place for the amendment. I want to amend the part of the Bill that deals with committees of Ofcom and advisory committees that may be set up to advise Ofcom. The Minister is clearly deeply embarrassed by the failure of the Government to refer to that subject. He looks stunned; I am sorry, but the two of us will get to know each other well during this debate. He is clearly embarrassed by the Government's failure to refer to consumer panels in the Bill. Opposition Members have spoken eloquently to amendment No. 32, but I am deeply disappointed—rather shamefully, because my married name is Mrs. Harvey—at the failure of the hon. Member for North Devon to persist with his support, which was most welcome.
Indeed. I could not agree more. It is deeply disappointing that the Government have led us up the garden path, particularly in the context of the White Paper. I put a lot of work into the amendment, as I am sure the Minister and the Committee appreciate. We set out precisely the role that the consumer panels should play: researching consumer views and dealing with concerns and issues affecting Ofcom's functions; publishing advice, conclusions and reports to Ofcom; taking account of the views of consumers with special needs, including those on low incomes or with disabilities—we debated at length the issue of disabilities—and even how the panels should be funded. I could not have been more helpful to the Minister. I responded warmly when my hon. Friend the Member for Lichfield suggested that my intention was for consumer panels to present the annual report of their proceedings and financial position to each House of Parliament.
I hesitate in pressing the amendment to a vote at this stage, but I firmly believe that such a provision should be included in this part of the Bill and I am determined not to leave the Bill without pressing the matter. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
I beg to move amendment No. 57, in page 12, line 25, at end insert—
I had rather forgotten about amendment No. 57 and was about to discuss other matters. I have sought to identify what I believe is the right place for the amendment; no doubt the Minister will not share my enthusiasm.
A number of consultations in the context of the White Paper were devoted to radio. When we considered this morning what expertise Ofcom members should have, I said that regard should be given to someone from the radio sector. To pursue that more vigorously, it would be entirely appropriate to reflect the wealth of consultation evidence to the Select Committee and in the Government's response to the White Paper that there should be a radio committee to provide advice to Ofcom.
I am a little perplexed. If we are to have a radio committee, why should we not have an internet committee, a telecommunications committee and a television committee? In that case, we might as well keep the Radio Authority, Oftel and all the other bodies and not bother with Ofcom in the first place.
I fear that the hon. Gentleman was not with us for much of this morning, when we debated at some length my concern about this matter. I am happy to rehearse that for his benefit this afternoon—[Interruption.] I hold the hon. Member for Rhondda (Mr. Bryant) in great affection, respect and esteem; so his career is probably dead in the water.
Having read a number of the consultations, I expressed concern this morning because there is so much emphasis—as the Minister has said, the debate on Second Reading focused almost entirely on this—on the inclusion of the BBC. That is the wish of consumers. The National Consumers Council has said eloquently and strongly that the BBC should be included in the entire remit of Ofcom, including the regulation of programme content and economic regulation. I welcome the opportunity to rehearse again, although perhaps not at the same length as this morning, my fear that radio will be left behind.
I want to do the radio sector justice. I am sure that the hon. Member for Rhondda will agree that the internet sector and the television sector might appear more sexy than the radio, although one hesitates to use that term. I repeat that I am an avid radio listener, particularly BBC and independent news broadcasts. I believe that it is entirely appropriate to consider the establishment of a radio committee. It was not that I had not thought to establish committees for other sectors; I had hoped that the hon. Member for Rhondda and his hon. Friends would support amendment No. 21, which we discussed this morning. Had he been here, he might have wished to do so. I hope that the Minister will support the amendment.
The amendment is very close to my heart. When I was 18 or 19, I put together a radio consortium to apply to run an independent radio station in Brighton. Then, the Labour Government came in and decided that there could not be independent radio, so that was put on hold and I went to university instead. In fact, I must have been younger than 19, because I went to university at 17.
I remember—this is relevant to the discussion, Mr. Stevenson—what it was like dealing with the IBA in those days, when radio was such a small part of the whole operation. We have just learned that there might be 1,111 people—what a marvellous number to remember—in this new giant Ofcom. I stand to be corrected on this, but I doubt whether there are more than 20 or 30 people in the current Radio Authority. I would be interested to know the number, but I understand that that might be the case.
The Radio Authority, for which I have nothing but praise, is a very tight ship. I have concern that there will be 20 or 30 people for radio in this behemoth—I love that word—of 1,111. Radio will once again be swamped, although it is a very important medium. As I have said, one can listen to it when one is on the move, something one cannot do with the internet or television; at least, one does so at one's peril. It has a different operation technically from other media. Digital radio on the move is not currently a goer because there are so few digital radio sets.
Consequently, the problems with radio are the same as they were some years ago, and they concern available spectrum. I remember in the 1960s, when I was not being Mickey Fabb on a certain pirate radio station, listening to Labour Ministers saying, ''There aren't the frequencies for independent radio. Planes will be falling out of the sky if Radio Caroline continues broadcasting.''
The growth of radio has been thanks to the work of the IBA, and especially the Radio Authority, which found available frequencies. Since the establishment of the Radio Authority, radio in this country has grown at a rate exceeding that of any other country in the world. It has been not only a regulator, but a good advocate, both in the United Kingdom and at international conferences, for finding available frequencies.
The amendment says that there should be a radio committee to press home the arguments for radio in this huge organisation. The hon. Member for Rhondda asked why there should not be other committees as well. It is up to him to table those amendments.
I am sorry to rise to that bait. I am not suggesting that there should be other committees, but that there should be an Ofcom, which is why I intend to vote against the amendment and in favour of the Bill. If I had been here this morning, I would have opposed separate committees on regional television, religious broadcasting and all the rest. It is a load of nonsense.
I would not want to put words into the hon. Gentleman's mouth, but I remind him that, in the previous Parliament, the Culture, Media and Sport Committee recommended, rightly, that there be a whole panoply—a horizontal tier—within Ofcom to ensure that the interests of particular sectors be maintained within it.
In an earlier intervention, the hon. Member for Rhondda asked my hon. Friend the Member for Vale of York, ''Why have an Ofcom?'' The answer is that it shall co-ordinate in a far better way the activities of the separate bodies. That is why Conservative Members support the general principle of the Bill.
Is the hon. Gentleman aware of the old adage, ''If you want to get rid of something or sideline it, you set up a committee''? Is not that what he is trying to do?
I thank the hon. Member for Rhondda. He is a scholar in such matters, and we all listen to him. That was said with no irony whatsoever. He has made some interesting observations in the Culture, Media and Sport Committee and I hope that he will do the same here.
There must be a strong advocate for radio because spectrum is still limited. The Radio Authority has
found spectrum where it had previously said that it was not available. It has had to fight its case against the BBC, which occupies frequencies, sometimes obstructively. In one instance, BBC local radio was sitting on a frequency that was being used only in Essex, thereby preventing the formation of an entire independent radio network.
The Radio Authority has presented strong arguments against the BBC, and there must be a radio committee to argue that spectrum should be made available for independent radio; and indeed, if the BBC comes under tier 3, to argue that it should be made available for the BBC. It is not simply a question of having spectrum available in the United Kingdom; that is an argument among competing bodies and broadcasters in the United Kingdom, and at times among other countries under the World Administrative Radio Conference.
We are so impressed by the wealth of experience that my hon. Friend brings to the Committee. Does he agree that such a radio committee could also play an advisory role in relation to digital radio, which the Committee has not considered? Analogue switch-off will also have specific implications for digital radio.
My hon. Friend raises an important point. As I said this morning, there are few digital radios in the United Kingdom. We have to commend the BBC and other broadcasters in the UK that are broadcasting digital radio terrestrially at present. I sometimes think that there are more transmitters than there are receivers to receive the programmes, but it is right that those broadcasters are transmitting digital terrestrial radio, because only that will stimulate the sale of digital radios.
The Radio Authority has seen the expansion of radio, so that we currently enjoy extremely local, short licences that are granted by the Radio Authority; quite a recent innovation. There is regional radio, national radio, AM radio, FM radio and, as I say, digital radio. I do not believe that few, if any, of those advances would have taken place—certainly not at the speed that we have seen—if the radio division were part of the IBA, as it was before the formation of the Radio Authority and the ITC and the death of the IBA.
I shudder at the thought of 25 or 30 radio officials working in this 1,111-strong Ofcom. They will be swamped, not only because the budgets are so much larger in television than in radio, but because there is a fascination with the new technologies. As the hon. Member for Milton Keynes, North-East (Brian White) has rightly pointed out on a number of occasions, Ofcom will not be simply a broadcasting regulator; it will be there to stimulate internet and broadband communications. Indeed, the reason for the formation of Ofcom is the convergence of technology. If there is not a radio committee, people will ignore poor old radio. Let us remember that it was this Government who rejected the idea of audio facilities being available on television for the blind, which makes a strong voice for radio even more important.
Mr. Stevenson, I shall not test your patience any further. This will be a short, sharp intervention.
I believe that radio has a special role to play for those who are disabled, particularly those who live in deeply rural constituencies such as the Vale of York and who may be on a low income under this Government. The Vale of York is now among the bottom 10 per cent. of the population and people living there depend even more on radio than on anything else.
The hon. Lady makes her point powerfully, with conviction and seductively, as always. However, although she seduces me, she seems to fail to seduce the Minister, despite the strength of her arguments. She is right; radio has an important part to play. When I am doing my Dysoning, I can listen to the radio, but I cannot watch television or use the internet. Although I am interested in the expansion of digital technology—I feel that I have some experience in that field—at the end of the day, I still listen to analogue radio.
Radio plays an important part in all our lives. As my hon. Friend the member for Vale of York said, it plays a more important part in the lives of the disabled, and those with sight disabilities. Whatever its good intentions, it will be natural for Ofcom to overlook radio, just as the IBA did. Some of the finest people who currently work for the Radio Authority may leave, unless they are convinced that Ofcom will concentrate on radio as much as the medium deserves. A radio committee would be an advocate not only for the industry and the medium, but for the millions of people who enjoy and need to listen to radio.
After a prolonged absence from the Committee, Mr. Stevenson, I thank you for noticing me. Before I make an intervention, I would like to declare some business interests that are not directly relevant to the Bill, but I disclose them for the Committee's benefit. They are in the Register of Members' Interests. One business has software interests in technology resulting from chip development that could affect digital radio.
I would like to reinforce the comments of my hon. Friend the Member for Lichfield. Radio is often an underestimated aspect of new media. One will be able to receive text and visual presentation on digital radio, providing a new wider scope for radio. Given that so much of the talk about new media concerns television, we should not underestimate the enormous potential of digital radio, and the integration of other media. One could be informed about the next programme, or receive a textual analysis of the events related to a particular programme. When listening to music, one will be able to discover who the composer is, the setting and so on.
That is why there should not be a separate organisation for radio. Everything that the hon. Gentleman refers to would make radio effectively become television. Nearly every office in the country has a receiver for digital radio; a computer. Many people listen to radio via their computers. The hon. Gentleman is arguing against the Bill, not in favour of the amendment.
No; in good Committee fashion, I am seeking to clarify what is often overlooked in the wider debate. The hon. Gentleman is obviously knowledgeable in such matters, but I would hope that he agrees that we often think of the potential of television, but not of radio. It is important that the new committee has an interest in radio. I am not speaking for any separate agency, but there should be a role for the radio sector in the Ofcom arrangements. We have not seen the details of the forthcoming Bill. To some extent, if my remarks are relevant to that, I accept that I am anticipating a future event.
My hon. Friend the Member for Rhondda put his finger on the problem immediately. I will not reiterate his point because he expressed it clearly. On the other hand, the hon. Member for Lichfield is such a magnificent generator of gas, it is a wonder that he has not entered into a contract with Enron.
Paragraph 14, to which the amendment relates, will enable Ofcom to establish such committees as it thinks fit to carry out its functions or to provide advice on matters relating to those functions. The debate will have contributed to that by sending the message that the Committee thinks that radio is important.
Hon. Members, on several occasions, have made their concern clear that radio must be properly represented in Ofcom. The days when radio could be regarded as a Friday afternoon job when it came to regulation are long gone. There have been great changes in the radio sector in recent years, and it is a strong, thriving part of the communications industry. Ofcom will want to ensure that radio's interests are given full weight in its deliberations and activities, and the Bill will enable it to do that.
We have had a good discussion and debate. I am not prepared wholeheartedly to accept the Minister's dismissive attitude that the Bill allows Ofcom to set up any committee that it wants. If we are to serve in a Committee considering a Bill to set up the necessary structures, it is incumbent on us to take these discussions and debates about the structure of Ofcom seriously. Mindful of the useful note to which he referred this morning—concerning the BBC's compliance with regulatory standards and the different types of radio that will come under that—the hundreds of responses that were made to the consultation and White Paper and the acute problems relating to radio summed up in the Select Committee's report, it is incumbent on us to consider a radio committee. However, I want to reserve that matter for a later stage, and I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The amendment was tabled by the hon. Member for Ceredigion (Mr. Thomas), who cannot be here today because of a long-standing prior arrangement. Nevertheless, it would be helpful to get something on the record, and I am sure that the Minister has a prepared response.
The amendment was tabled to tease out a Welsh language issue. We have had a long debate about the use of the Welsh language in broadcasting, and the amendment relates to the function of Ofcom and the way in which public bodies in Wales are deemed to function in the context of Welsh language legislation; for example, they must publish proceedings bilingually. I shall not spend as long on the amendment as we spent on the previous one because I merely want to offer the Minister an opportunity to put on record his intentions in respect of the use of Welsh language, in order to assist the hon. Member for Ceredigion and the Committee.
It is right and proper that Ofcom should fall under the ambit of the Bill and, as the hon. Member for Sheffield, Hallam said, there is a special role for it. We have already heard from the hon. Member for Rhondda who has said that part of his election pledge was to enable not only S4C but Channel 4 to be received in his constituency. Ofcom has a particular role in the dissemination of Welsh language programming, Welsh language content and, for all I know, the Welsh language on the internet. It would seem correct and proper for Welsh to be incorporated in the amendments. Will the Minister tell us whether the annual report that we discussed earlier will be available in Welsh? Will the people of Pontypridd be able to read it in Welsh?
I am sure that there are Welsh speakers in Pontypridd who would wish to read the report in Welsh. This is an important issue. The Committee that discussed the Welsh language legislation was the first on which I served in this House. It was there that I learned to orate, if there is such a word. Hon. Members can blame that Committee if they think that, to use the Minister's unkind term, I am gassing too much in this Committee.
New clause 4 would make Ofcom a public body for the purposes of the Welsh Language Act 1993. That would require it to ensure that, in relation to its activities in Wales, the English and Welsh languages were treated on an equal basis. That happens with most public bodies inside Wales.
I am very sympathetic to the intentions behind the new clause, but I am concerned about the cost implications for the whole of the United Kingdom. It is impossible to tell how many extra staff might be needed to enable Ofcom to comply with the new clause, but we must not unnecessarily inflate the cost of regulation in the communications sector, especially bearing in mind that the cost of the regulators will be met by regulated companies and, ultimately, by the consumer.
The amendment, however, makes a valid point that I shall draw to the attention of the Ofcom board. I am sure that Ofcom will wish to have good relations with business and consumers in all parts of the United Kingdom and where that involves using the Welsh language, it will want to do so. I hope that it will.
I am grateful to the Minister for putting such a clear statement on the public record. Obviously, it is for the hon. Member for Ceredigion and his colleagues to decide whether they wish to return to the matter later but, for now, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendment No. 35 reflects my hope that Ofcom's decisions will be taken by a majority of its members. The reason is, simply, that two alternative models could be proposed in the setting up of Ofcom. One is that followed by the telecommunications industry with its single statutory regulator, the Director General of Telecommunications. The other is characterised by a more collegiate approach. My thinking in the amendment is that the powers of the new regulator are so extensive and so structured under the Bill that it would be appropriate for decisions to be reached by a majority of its members. By that, I mean that they would adopt the collegiate approach rather than the model used by the telecommunications regulator.
Obviously, that would mean, as in a Cabinet—something with which the Minister is familiar—once there had been a vote and the majority ruled, all members of Ofcom would be bound by the decision, including those who did not agree. That would be a more collegiate approach.
Amendment No. 15 concerns the decisions of Ofcom being published. I believe that it is the desire of those being regulated—I am sure that it will also be the wish of the regulators who are to be replaced by
Ofcom—that, in the interests of the greatest possible degree of accountability, Ofcom's decisions should be published. That was the Select Committee's desire. It said that the new regulator should have a
specific duty . . . to ensure that its governing body and its sub-commissions or committees meet in public unless the governing body is satisfied that, in the case of any particular issue under consideration, the interests of public disclosure are outweighed by the need for commercial confidentiality.
For reasons that the Committee will understand, it is not my wish to seek to compromise the commercial confidentiality of any company in any sector that will come under Ofcom's remit. However, I believe not only that its committees should meet in public, but that their decisions should be made public.
I pray in aid the Select Committee's further recommendation that
where any decision is reached by vote, the voting records are published
and that there should be a requirement
that all meetings with broadcasters to discuss their annual reports on delivery of programme statements are held in public.
It can only help the Minister in the jigsaw puzzle of putting the regulator together under the Bill that we refer to the publication of Ofcom's decisions, which, as I say in amendment No. 35, should be taken by a majority of its members. I think that all Committee members want Ofcom's decisions to be as accountable and public as possible.
Amendment No. 35 refers to Ofcom's decisions being made by the majority. Does my hon. Friend agree that there should also be reference to a quorum? With a very small body—it is envisaged that Ofcom might have as few as three members—a decision could be made by two people. Whether the chairman should have a casting vote could also have a significant effect on such a small group.
That is a pertinent and relevant point. I would like to elaborate on it later, and perhaps table a separate amendment on it. Having lost the argument, as the Minister will recall, that this Committee should have the right to set a maximum number of members, so that the Secretary of State could not appoint more than 10 in addition to the chairman and deputy chairman, I find the point made by my hon. Friend the Member for Upminster (Angela Watkinson) entirely relevant. We should consider whether Ofcom ought to have a quorum in its meetings and when making a decision. The Minister might enthusiastically embrace that idea.
In the representations made, not least by consumer organisations, the plea—[Interruption.]
I am most grateful. I am sure that important matters relevant to the Committee were being discussed and that we can continue those discussions later.
The amendments reflect the overwhelming body of opinion that emerged during the consultation on the White Paper and in the representations that
Committee members have received. I will not go through each one, unless the Minister feels that I should. There should be accountability and openness of decision-making, and a collegiate approach—a majority decision by which all are bound—is preferable to a single regulator.
Having made those points briefly, I hope that the Minister and the Committee will be able to adopt the two most modest amendments that we have considered today.
The Government pride themselves on open government, but whether they are able to deliver that is another matter. I should like an open Ofcom. Ofcom will have to make tough decisions on several different issues. The Radio Authority is involved almost on a day-to-day basis in awarding, and sometimes taking away, independent radio franchises. Ofcom will have similar functions in respect of independent television and other media that it controls. It will also be involved with licensing, cable providers and so on.
Some of the discussions regarding how those decisions are made should be held in camera, but on other occasions a degree of openness will be required. That is what amendment No. 35 would do, by ensuring that there was democracy within Ofcom. Amendment No. 15 would ensure that Ofcom's decisions were published. I do not know whether my hon. Friend the member for Vale of York thinks that that publication should be in the form of a report, printed in ink on paper, or merely on Ofcom's website. Would she be happy with the latter option?
I personally think that if it were published only on the web, it would save Ofcom money. If it saves Ofcom money, it saves the money of the organisations that it is regulating, because when the main body is eventually established those organisations will fund Ofcom's operations.
If it were published on the net, it would help to meet the Government's target of ensuring that all Government services were online by 2005, which is looking a little shaky.
My hon. Friend makes a powerful point. The whole position of open government is shaky at the moment, as evinced by changes in the Cabinet Office. However, I shall not take that line, Mr. Stevenson, because it would be out of order.
These are two short and simple, but powerful, amendments. They are powerful because they get to the whole basis of open government and whether the Government are concerned with keeping the promises that they made in 1997.
I am curious about whether the hon. Gentleman has considered the alternative, because reversing an amendment sometimes helps. If it said, ''Decisions of Ofcom should be made by a minority of its members and kept secret'', that clearly would not work. I find it hard to understand how Ofcom can operate other than by following the rules that he suggests. How can a regulator regulate anyone if it does not publish the things that it wants them to do?
Very surprisingly, the hon. Gentleman, for whom I have the highest regard, has somewhat missed the point and is taking a rather simplistic approach. Clearly the main decisions of Ofcom will be published, but the build-up to those decisions should also be published.
Perhaps I should withdraw that remark, because the hon. Gentleman has a point. When my hon. Friend the Member for Vale of York says that Ofcom's decisions should be published, does she mean the decision-making process, or merely the decisions themselves?
Thank you, Mr. Stevenson. I do not know how I missed that.
Given that ruling, the hon. Member for Sheffield, Hallam has a point. The award or withdrawal of licences would have to be published, or there would be difficulty in withdrawing or awarding them, but Ofcom will make other decisions relating to its internal workings. Under normal circumstances they may not be published and they certainly would not affect outside organisations directly, in the short term, if they were not published. It is not so foolish of my hon. Friend the Member for Vale of York, as the hon. Member for Sheffield, Hallam suggests, to table amendment No. 15. Without it, internal decision-making processes in Ofcom that might have long-term ramifications for the future of technology in this country would not be published, and people would not be able to see through the exterior of the Ofcom organisation.
I believe that the points are clear. We want democracy, transparency and openness; or glasnost, as Mikhail Sergeyevich Gorbachev would have said. The question before the Committee today is whether the Minister wants glasnost.
I appreciate that the intention behind amendment No. 15 is to ensure openness and transparency of Ofcom's decisions. The hon. Member for Lichfield will be pleased to know that the Government share his desire that Ofcom should operate in as open and transparent a way as possible. Indeed, paragraph 22 of the schedule makes Ofcom subject to the Freedom of Information Act 2000, and paragraph 23 of the schedule applies the Public Records Act 1958 to Ofcom. Those provisions, taken together, mean that it will have the same duty to
maintain records and respond to requests for information as other official bodies.
I see no benefit in going beyond that. To maintain the confidence of relevant interests, Ofcom will no doubt wish to make as much information available as possible, but, as the hon. Member for Vale of York hinted, it may not be possible for Ofcom or its committees to undertake all their proceedings in the full glare of public scrutiny. There will often be matters of commercial sensitivity—for example, in competition matters, in which Ofcom will have concomitant powers with the Office of Fair Trading—or cases, which we have not heard about so far, involving personal privacy or fairness to individuals, where the full disclosure of proceedings could reveal information that could itself breach confidentiality. In such circumstances it would not be right to require that Ofcom should be under an obligation to reveal detailed information. It must have the discretion to decide what arrangements would be most appropriate in the circumstances.
Amendment No. 35 would require that Ofcom's decisions be taken by a majority of its members. Paragraph 15(3) of the schedule gives Ofcom the power to make arrangements about quorums and reaching majority decisions. It is surely for Ofcom to identify the arrangements that it wishes to adopt. To require that all decisions be taken by a simple majority of Ofcom members would unnecessarily constrain the board's freedom to make decisions in the most
appropriate way, and in particular to delegate those decision-making powers to committees; something for which the Opposition have been consistently arguing. To require a majority of members—not merely those present, or present and voting—would be a great constraint on the effective conduct of business. The Government and the Committee should not be in the business of control-freakery, and I am sorry to hear that the hon. Lady's party is.
I shall not respond to that challenge on this occasion. The Minister is wilfully misunderstanding the position of the Opposition. I prefer that the decisions of Ofcom should be taken by a majority of its members. It is not good enough for the Minister to say that it is for Ofcom to devise its working practices and structures. I thought that that was the purpose of the Bill. I am happy, subject to later developments, to withdraw amendment No. 35. However, I should like to press amendment No. 15 to a Division at the appropriate time. Ofcom decisions would not be published if public disclosure was not helpful on the grounds of confidentiality.
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule agreed to.
Further consideration adjourned.—[Mr. Kemp.]
Adjourned accordingly at nineteen minutes to Seven o'clock till Thursday 31 January at half-past Nine o'clock.