Television Licence Fee

HC Deb 17 April 1985 vol 77 cc355-72 10.23 pm

Mr. Robert Kilroy-Silk (Knowsley, North)

I beg to move, That an humble Address be presented to Her Majesty, praying that the Wireless Telegraphy (Broadcast Licence Charges and Exemption) (Amendment) Regulations 1985 (S.I., 1985 No. 490), dated 25th March 1985, a copy of which was laid before this House on 27th March, be annulled. I regret that it is necessary to have this debate in the shadow of what is probably the greatest threat there has ever been to public service broadcasting, the BBC and television standards. The threat is represented by the inquiry announced by the Home Secretary of 27 March, to be conducted by Professor Peacock, into an assessment of the effects of the introduction of advertising or sponsorship on the BBC.

This is the wrong inquiry and it is being chaired by the wrong man. It is the wrong inquiry because it is clearly based on the assumption that advertising on the BBC would be appropriate and acceptable, when it clearly would not be. It is also based on the assumption that the introduction of advertising on BBC television or radio is the only source of funding for the BBC other than the licence fee. But it is not the only other source.

If the Government were really concerned about the future of broadcasting, let alone the future of public service broadcasting, if they were serious about the way in which our broadcasting system should be financed, and if they were concerned to develop a proper, coherent strategy for broadcasting, they would have commissioned an inquiry into communications policy generally for the whole of the United Kingdom.

As it is, this inquiry is a shoddy cop-out and it represents the price that the Home Secretary has been prepared to pay to, as he believes, achieve the objective of satisfying some of his hon. Friends who want to see a reduction in the influence and the services provided by the BBC as well as an increase in advertising.

Mrs. Elaine Kellett-Bowman (Lancaster)

rose—

Mr. Kilroy-Silk

I do not intend to give way to the hon. Lady. I know what she wishes to say, and I shall be coming to it.

It is the wrong inquiry and, as the hon. Member for Lancaster (Mrs. Kellett-Bowman) wishes to remind me, I said that it was also chaired by the wrong man.

Mrs. Kellett-Bowman

That is the remark on which I wanted to comment.

Mr. Kilroy-Silk

I am afraid that the hon. Lady will not get the chance to say what she wishes to say in that case, because I am trying to protect the interests of those of her hon. Friends who wish to speak in the debate in the hour that is left to us, many of whom have asked me to make a brief speech so that they may do so.

The inquiry is chaired by the wrong man because, although Professor Peacock may be an estimable and worthy man, he is also well known for his free market views, for his support of laissez-faire economics and for his advocacy of such Tory measures as education vouchers. His views do not inspire confidence in either his objectivity or his impartiality on the issue with which he has been entrusted. Added to that is his public criticism of the licence system as a means of raising revenue for the BBC and his stated public tolerance of advertising on the American television networks.

Given that kind of track record, it is no wonder that such a man should have been chosen to hold the inquiry, and it is small wonder that many individuals in broadcasting, especially in the trade unions involved in broadcasting, feel that the inquiry is biased in favour of advertising and that the report could well have been written already.

It is difficult to avoid the suspicion that the Government and Professor Peacock have already arrived at their conclusion and that Professor Peacock is the man who has been chosen to make those recommendations and implement those proposals. It is difficult not to see the hand—on this occasion the malign hand—of the Prime Minister behind this proposal and this inquiry.

Of course, the Prime Minister is supported by the more philistine, unthinking and avaricious among her Back Benchers. Nothing was more disturbing and offensive than to witness the baying ranks of PR Tory Members of Parliament three weeks ago emitting clear spite, hostility and vengeance towards the BBC. They seem to be motivated by nothing more than vindictiveness towards public broadcasting, hostility to the BBC, and greed for what they see as the rich pickings likely to be had if advertising is introduced into BBC television or radio.

I say again that the Opposition are implacably and fundamentally opposed to the introduction of advertising on BBC radio or television.

Mr. David Maclean (Penrith and The Border)

Why?

Mr. Kilroy-Silk

Because we believe that it would damage the BBC, the independent television network and the rest of the media.

Mr. Maclean

How?

Mr. Kilroy-Silk

I should expect the hon. Gentleman to have done sufficient homework to be able to answer his own questions. As he has not, let me answer them for him. It would damage the BBC because it would inevitably lead to a lowering of standards, not just on BBC television but on independent television, and to producers and schedulers of programmes pandering — even if only unconsciously — to what they regard as the interests and demand of advertisers. They would tend to fashion their programmes and their scheduling to forms for which advertisers are prepared to pay the most. Inevitably, producers and programme devisers would respond to the lowest common denominator in establishing their programme priorities.

The hon. Member for Penrith and the The Border (Mr. Maclean) is no longer asking why or how. He seems to be easily satisfied. There would be a drive by the BBC to win bigger audiences, because that means bigger advertising rates, which means greater revenue. There would therefore be more worthless, philistine and superficial programmes. The consequence would be the type of appalling distasteful television which many of us have witnessed to our great dissatisfaction and which disfigures the screens of American television but which, apparently, according to the public record, Professor Peacock admires.

Nor does the Labour party accept that the introduction of advertising—even on one part of the BBC during a limited period of the day, on any of the BBC channels —would be tolerable or acceptable. Once advertising is allowed — whatever its form and however minute or marginal it is — it will be irresistible in future. Home Secretaries confronted by a broadcasting corporation needing an increase in the licence fee to meet that demand would extend the allowable amount of advertising. There would be irresistible pressures to extend and increase advertising every time the BBC asked for increased financial support. That would be an easy option that few Governments could resist.

The introduction of advertising not only would lead to a lowering of standards in the BBC and independent television companies and to more demands for even greater advertising but would damage irreparably the independent television companies, commercial radio and local newspapers. The Home Secretary has acknowledged that implicitly in the inquiry's terms of reference and during the debate when he announced the increase in the licence fee and the setting up of the inquiry.

Clearly, there is a risk that the introduction of any form — however minute — of advertising on BBC radio or television would substantially erode the financial viability of independent local radio, local newspapers and, in many ways, independent television companies. Many of them would face the prospect of severe financial difficulties, if not bankruptcy, because the advertising cake is limited. That is not my assertion; it is the assertion of Sir Denis Forman, the chairman of Granada Television, and Rodney Harris — [Interruption.] I understand what the Government are saying. Of course Rodney Harris has a vested interest. That does not mean that his opinions are right or that they are wrong. I am merely quoting his opinion.

Many others make that assertion — not just the chairman of Granada or Rodney Harris, the media director of the advertising agency that started this whole debate. During the past two weeks, that agency has confirmed that many independent local radio stations may face substantial difficulties if advertising is allowed on the BBC. Saatchi and Saatchi has spoken clearly about the risk to independent local radio. Many small radio stations and local newspapers would be bankrupted if advertising were allowed.

I suppose that all those individuals could be tarred with the brush of having a vested interest, but, as I have said, that is no reason to disbelieve what they have to say or to suggest that their judgment is suspect. I presume that the Minister of State does not have a vested interest. If he does, perhaps he will declare it.

Speaking in the late night debate on 19 December, 1984, the Minister made out a strong, powerful and compelling case against the introduction of advertising on the BBC. He talked about feast and famine in the margarine industry. I am not sure of its relevance, but he clearly went on to say: It is by no means certain that advertising revenue will continue to grow at the same rate as in the past 10 years. In fact, ITV revenue this year looks certain to fall short of the £1,000 million forecast for 1984, even though only two or three months ago it seemed likely"—

Mr. Patrick Thompson (Norwich, North)

On a point of order, Mr. Deputy Speaker. There is nothing about television advertising in the regulations.

Mr. Deputy Speaker (Mr. Ernest Armstrong)

The Chair will decide what is relevant to the debate.

Mr. Kilroy-Silk

The Minister of State said: ITV revenue this year looks certain to fall short of the £1,000 million forecast for 1984, even though only two or three months ago it seemed likely to reach that figure."—[Official Report, 19 December 1984; Vol. 70, c. 507.] He then went on to talk about the sharp downturn in adverising revenue and how there would be great difficulties for the ITV companies if the BBC took the major share of the cake. He spoke about competition from the BBC obliging the independent companies to take a reduction in their revenue.

If any Conservative Members are worried about the likely consequences for all our media of the introduction of advertising on the BBC, they will see no more compelling or convincing case than that presented by the Minister.

Those are clear, good, compelling and practical reasons why we should be careful about any proposal to introduce advertising on the BBC. They are important and must be taken into account. Leaving them aside, however, the Opposition resort to the arguments of principle. I reaffirm that there will be no circumstances in which the Labour Government who will be elected at the next election will allow advertising on BBC radio or television.

Mrs. Kellett-Bowman

On a point of order, Mr. Deputy Speaker. Could the hon. Gentleman be perst. aded to deal with regulation 2? It relates to the increase in fees, which is of great anxiety in the north-west.

Mr. Deputy Speaker

The hon. Lady knows that that is not a matter for me.

Mr. Kilroy-Silk

As you will be aware, Mr. Deputy Speaker, but as the hon. Lady and the hon. Member for Norwich, North (Mr. Thompson), who intervened earlier, do not seem to know, we are talking about regulations that deal with the financing of the BBC. As part of the statement about the increase in the licence fee to which these regulations give effect, the Home Secretary announced the setting up of an inquiry whose terms of reference were to study the feasibility of obtaining the licence fee revenue which will be obtained by the order by means of advertising.

It is reasonable and acceptable, therefore, when discussing the financing of the BBC, to talk about the alternative means that the Home Secretary clearly has in mind, but which the Opposition feel would not just be damaging to the BBC, ITV and the media generally but would be completely unacceptable and indefensible in principle.

Mr. Richard Tracey (Surbiton)

rose—

Mr. Kilroy-Silk

I shall not give way. We accept that as the licence fee increases so it becomes more regressive and burdensome on low-income individuals and families. It represents, for example, a high proportion of the income of pensioners.

Many of our pensioners, particularly those living alone, are very dependent on television. Many of them are housebound; many are inactive, ill or disabled. Indeed, it has been said that they watch 20 per cent. more television than other viewers do. It is clearly unjust that after this order has been passed by the House they should be required to pay £58 to have the privilege of watching television, while many other pensioners, because they live in sheltered housing accommodation, pay no more than 5p. That is clearly wrong. It is a very deep and serious cause of resentment and bitterness. It is indefensible and cannot be accepted.

It is also wrong and unjust that hotels pay the same £58 to provide 15 television sets; they pay exactly the same price as one pensioner living on a single pension. We have the ability to change that and we should have the will to change it.

Many pensioners—hon. Members on each side have the letters and representations at their surgeries—[HON. MEMBERS: "Where are they?"] They are watching the football. Many pensioners are deeply anxious and distressed about their ability or inability to find the money that is required to pay the licence fee so that they can watch television not just in comfort but without guilt and without breaking the law. We recognise that, as the Home Secretary and the Government do not, and we shall therefore phase out the television licences for pensioners. We shall not be prepared to tax pensioners in order that they may have the benefit of watching television in their own homes.

We accept that that will cost the Treasury about £320 million a year, and no doubt the Minister, when he responds to the debate, will pour scorn on the amount of money that we are prepared to provide so that pensioners should have the ability to watch television without having to pay the new exorbitant fee. Yet, if we put this in the context of other tranches of £325 million, the comparison is not perhaps as odious as the Minister may attempt to make out.

In order to give all our pensioners a free television licence next year, we have only to take out seven months of the cost of the Trident programme. [Interruption.] It is a clear choice. This House has the power—

Mr. Eldon Griffiths (Bury St. Edmunds)

On a point of order, Mr. Deputy Speaker. While I heard very clearly your correct observation to the House that it is, of course, entirely for the Chair to determine the rules of order, may I draw your attention to the exact text of the order before us?

Mr. Deputy Speaker

May I remind the House that the debate must finish at 11.30 pm? Therefore, I ask for brevity. The hon. Gentleman should know that I have considered the order very carefully. We are discussing an increase in fee. All that has been said is relevant as to where the money comes from, the cost, and other matters.

Mr. Griffiths

With respect, Mr. Deputy Speaker, you indeed are the very last person whom I would wish to challenge. I would, however, respectfully say to you that the order before us contains two elements — first, the title of the regulations, and, secondly and quite specifically, the increase in charges. It does not deal with advertising; it does not deal—

Mr. Deputy Speaker

Order. I have the same respect for the hon. Gentleman as he has expressed for me. I have considered the order very carefully, and all that has been said about advertising, the cost and where the money comes from, in my view is relevant.

Mrs. Kellet-Bowman

And very boring.

Mr. Deputy Speaker

I ask for great brevity, because the debate will finish at 11.30 pm.

Mr. Kilroy-Silk

This is a matter for a clear political decision, which can and should be taken by the House of Commons. Hon. Members on the Government Back Benches are entitled to take the view that they would rather spend £325 million on the purchase of a Trident missile system. [Interruption.] We do not share that view. We believe that that kind of money could be much better spent on providing the facility of a free television licence for pensioners.

The £325 million that would be required to implement our promise to give free television licences to pensioners is also less than the Government's current spending on production support for surplus cereals. Can any hon. Member defend the expenditure of more money on producing and storing food that no one wants or consumes—

Mr. Deputy Speaker

Order. The hon. Gentleman is trying the patience of the House. He must not list in detail the alternatives that the money is being spent on.

Mr. Kilroy-Silk

With respect, Mr. Deputy Speaker, I think you will understand that it is very difficult to make a speech, given the constant barracking and harassment of Conservative Members. [Interruption.] They are making my point again. I think you would also accept that as we are debating regulations which will increase the licence fee paid by all our constituents, it is reasonable and in order in that context to refer to people who can least afford to pay that licence fee. Surely, then, it is in order to meet the argument that will be deployed by other hon. Members later in the debate by drawing comparisons between the large cost of implementing this promise and other expenditure that I would regard as non-essential. In the light of the examples I have given — and I could give many others — we believe that providing free television licences for pensioners at that price is a bargain that we are prepared to pay and that I am sure they would welcome.

We want to preserve the integrity of the BBC and to maintain the standards of public service broadcasting. We want to preserve the economic viability of the independent television companies, of independent local radio and, indeed, of local newspapers. We want also to protect the political independence of the BBC from the philistinism, the avarice and the greed that will be demonstrated tonight by Conservative Members. All of those things that we wish to protect are under threat from the Government. It is our mandate to defend them and we will continue to do so.

10.47 pm

Mr. Mark Carlisle (Warrington, South)

The hon. Member for Knowsley, North (Mr. Kilroy-Silk) took 24 minutes in a debate which must end at 11.30 pm. I shall try to be brief. His speech was typical of what one expects to hear from Opposition spokesmen on Home Affairs matters. It was memorable for the total lack of support that he had from his own Benches. His offensive remarks about those who happen to disagree with him were also typical.

I was at least glad to hear that the hon. Gentleman does not propose to divide the House. I hope that the regulations will go through without a Division, because I believe my right hon. and learned Friend the Home Secretary is right in his decision. I hope that he will have the support of the House.

I want briefly to make four points. First, it is a fact that the BBC as a service has to be paid for. When one considers all the services provided by the BBC on television and radio, the fact that they are provided at a cost per day of less than would buy a copy of the Daily Mirror or The Sun shows that it is good value for money. That is the view of the vast majority of people. Speaking for myself, I have had one letter expressing concern since my right hon. and learned Friend made the statement about the increase in the licence fee. It may be the fact that it costs more to post one letter than to pay one day's licence fee for the BBC.

Secondly, I am interested to see that the right hon. Member for Manchester, Gorton (Mr. Kaufman) has chosen to leave the Chamber. I do not blame him. I am not surprised that he has put up the monkey rather than the organ grinder to speak tonight. Frankly, the shameless vote-catching pledge given on 27 March by the right hon. Member for Gorton, claiming that if the Labour party were returned there would be no television licence free for old-age pensioners, is a disgrace, and Labour Members know it. According to the right hon. Member for Gorton, who has disappeared, not only are they opposed to any form of advertising, but it will not be provided out of general taxation. The real honest pledge for the Labour party to make if it wishes to go forward as the party that believes in freedom of information is to announce tonight not that a vote for Labour is a vote for free television licence for old-age pensioners, but that a vote for Labour is a vote for an £88 licence for everyone else. That is what it would mean.

My third point is that there is concern among old people about the cost of the television licence, because it has to be found as one sum. When he replies, I hope that my hon. Friend the Minister of State will give encouragement and support to the BBC by making it possible for the television licence to be paid for on a weekly or monthly basis. If it were paid for in that way, old-age pensioners would find it easier than finding the sum in one go.

My final point is about the inquiry that my right hon. and learned Friend the Home Secretary has proposed. I do not object to the inquiry. Personally, I would regret it if the BBC were to be financed by advertising. It is arguable that the BBC has gone wider than it should. I was a members of the General Advisory Council of the BBC when it started out into local radio. I questioned its wisdom then, and I still question it today. It is an area that could be covered by the commercial interest, but that has been done, and, in fairness to the BBC, it has been done successfully. I questioned whether it was right to go into breakfast television. That is a very small part. It is right that any inquiry should look at the role of the BBC and ask whether it is right that what one might call the peripheral areas should be financed in the way that they are.

I say to my right hon. and learned Friend the Home Secretary that I believe that the central thrust of the BBC, which seems to me to be its national programmes on television and radio, has enhanced the standard of television. Those programmes have enhanced it generally. If we were to turn to having them financed by advertising, it would be to the detriment of the standard not only of the BBC but of ITV. I do not dispute the need to look at sponsorship and other matters, but I hope that I shall not see the day when my right hon. and learned Friend invites the House to support advertising as a means of financing what I would call the BBC's basic services.

10.53 pm

Mr. Clement Freud (Cambridgeshire, North-East)

I shall try to be as brief as the right hon. and learned Member for Warrington, South (Mr. Carlisle), with whose views I largely agree.

Many years ago a young man went to a police station and told the sergeant on duty that there were some workmen dressed up as Oxford undergraduates digging up Piccadilly. He then went to the foreman of the workmen digging up Piccadilly and told him that there were some undergraduates dressed as policemen who were going to try to arrest them for wrongfully digging up the road. He then stood by and watched the most tremendous fight between the police and the road workers. That is very much what the Labour party has done on this matter. The Labour party is so void of ideas that it has tabled a prayer for no other reason than to cause trouble among Her Majesty's Government.

It is right for the House to realise that. One is sorry to intrude upon private grief. Nevertheless, this is a prayer. Whereas reading it on the Order Paper made it sound like an agnostic prayer, having heard it, it is more like an atheist prayer. It is supported by three Opposition Members, and when it was presented by the hon. Member for Knowsley, North (Mr. Kilroy-Silk) he totally ignored the Wireless Telegraphy (Broadcast Licence Charges and Exemption) (Amendment) Regulations 1985, against which he was praying.

When the Labour party was in government between 1974 and 1979, it had every opportunity to cut or abolish the licence fee for old-age pensioners. During the four or five years in which Labour Members had the opportunity to do that they did absolutely nothing, but now that they are in opposition they say, "Let us save £320 million". This is no more than a charter to rent a grannie. If there were legislation whereby pensioners would not have to pay a licence fee, all that would happen is that everybody would find a pensioner who would somehow apply for a licence.

When the Labour party was in government it did not even undo the 5p licence for pensioners in warden-controlled accommodation. It would not have been difficult for that to be done. The excellent Annan report said: Moreover, other elderly people who were not eligible for the licence considered that it favoured those who were already favoured by living in a home or in accommodation with the services of a warden. The Labour party is wasting the time of the House on what is nothing more than a villainous little prayer, by which it is trying to make trouble. It is total humbug.

I am in favour of the continuation of the television licence in order to preserve the independence of the British Broadcasting Corporation. I would not like commercials to be shown on the BBC. God help us if people cannot have one channel, or preferably two, on which they can watch programmes of quality that are not interrupted every few minutes. Those who watched the open golf championship in America and found that every few minutes the action of play was interrupted by yet another commercial know how appalling it is to be unable to watch quality television without interruptions. If this prayer should come to a vote, and I hope that it does, as does the right hon. and learned Member for Warrington, South, my right hon. and hon. Friends and will not support it.

10.58 pm

Mr. Robert B. Jones (Hertfordshire, West)

The 25-minute speech of the hon. Member for Knowsley, North (Mr. Kilroy-Silk) convinced me, if I needed to be convinced, that there is a thought-free zone opposite. On a subject so important as the financing of the BBC it is appropriate that we should spend the scarce time that is available to us upon the key issues. It is a pity that when Parliament is provided with only a very limited opportunity to debate the BBC—about once every three years—it does not discuss the issues at stake.

This debate is largely about the size of the licence fee, not whether advertising should be allowed. I am content to await the outcome of the inquiry that has been set up by my right hon. and learned Friend the Home Secretary, although I disagree in principle with my right hon. and learned Friend the Member for Warrington, South (Mr. Carlisle). At my instigation a debate was held shortly before Christmas on the possible alternatives which I hope will be considered by the inquiry.

This debate is also not about the editorial content of BBC programmes. My view has certainly never been conditioned by any criticism in that respect. On the contrary, many of the BBC's programmes are excellent, but that is not to say that some ITV programmes are not excellent, too.

I have two main reservations about the present situation. The first concerns the period within which the inquiry is to report. I believe that August 1986 stretches the time limit beyond all reason. If the report were to be available at the end of the two-year period—that is, by March 1986, in time for implementation in the year ending March 1987 —that would go a long way to reassure me. Perhaps my right hon. and learned Friend the Home Secretary will be able to apply some pressure in that direction.

The second main issue is the fee. Two factors are involved. First, the increase is greater than the predicted rate of inflation not just over the two-year period but over three years, if we are to take my right hon. Friend the Prime Minister at her word, as I certainly do. That lends credence to the view that the BBC, like many institutions, will be less rather than more committed to improving efficiency. The argument that inflation in broadcasting is higher than in the economy as a whole is a self-fulfilling prophesy. We must encourage the BBC, like any other institution, to create less inflation than in the economy as a whole and thereby help to reduce inflation in the economy as a whole. Much of the extra inflation in broadcasting is in fact due not just to overmanning in the BBC but to overmanning and restrictive practices in the IBA as well. That is one reason why, contrary to the view of my right hon. and learned Friend the Member for Warrington, South, I believe that it is important to have competition for advertising.

Secondly, the principle of the BBC licence fee has declined in legitimacy. In the days when the BBC provided a monopoly service, it was an easy equation for the punter to decide whether the service was worth the fee, but that situation changed with the advent of the BBC-IBA duopoly. Since then, technical change has brought cable television and it will shortly bring satellite television. Furthermore, many people now use their television sets to play video recordings which may have nothing whatever to do with BBC or, indeed, ITV broadcasts. Yet the licence fee must still be paid. I therefore question the legitimacy of the BBC having a monopoly of funds from this source when it is no longer responsible even for the majority of the service to people with receivers.

I hope that my right hon. and learned Friend the Home Secretary will consider those two reservations. He may be able to reassure me on the time scale, but I remain profoundly worried that he has gone along with an inflation figure greater than that for the economy as a whole.

11.3 pm

Mr. David Winnick (Walsall, North)

I wish to make just two points.

First, provoked to some extent by the hon. Member for Cambridgeshire, North-East (Mr. Freud), who spoke on behalf of the Liberal party, I wish to mention the problems of elderly people living on their own. Labour Members believe that there is every justification for ensuring that a concessionary television licence fee is available for such people. For many elderly people, particularly those getting on into their seventies, television is not just entertainment but a link with the outside world, especially during the winter months. I believe that it is right to have other concessionary schemes for the elderly such as the bus pass, and I hope that no one is suggesting that this should be discontinued. If any Tory Members think that it should be, they should say so to their constituents. If we accept that it is right to have schemes for the elderly, then I believe they should pay a much much smaller fee than the proposed £58 for a colour television licence. Such a scheme will be introduced in due course, if not by this Administration and thereafter no Government will dare withdraw it.

I am strongly opposed to any attempt to introduce advertising in BBC transmissions. Only a few months ago my hon. Friend the Member for Bassetlaw (Mr. Ashton) introduced a Bill that would have had that effect, but it was defeated, mainly with the help of Labour Members. There is no enthusiasm in the country for advertising to be introduced on to the BBC. In the main, viewers welcome the opportunity to be able to watch television without having to suffer commercial breaks, and sometimes quite long ones.

There seems to be a lobby for advertising on the BBC on the Conservative Benches, but I welcome the remarks that have been made so far by Conservative Members who are opposed to it. I am sure that others want to argue the case for the introduction of advertising on to the BBC.

Whatever my criticism of the BBC — I was certainly critical of it during the previous general election because I do not believe that it was as free from prejudice as it should have been — it would be madness to undermine the professional excellence, independence from advertising and wide esteem, leaving aside political matters, in which the BBC is held in Britain and by so many abroad. We have had public service broadcasting for many years and anything that will erode the service that it provides, such as advertising, should be fiercely resisted. I hope that the Home Secretary and his Cabinet colleagues will resist the undoubted pressure from the Conservative Benches for the introduction of advertising into BBC transmissions.

11.7 pm

Mr. Tim Brinton (Gravesham)

My hon. Friend the Member for Hertfordshire, West (Mr. Jones) questioned the need for a licence fee for the BBC. I suspect that we shall attempt closely to consider and scrutinise what the licence fee revenue should be used for, and that we shall be unable to do so without discovering what new finances would do for all other broadcasting.

The hon. Member for Cambridgeshire, North-East (Mr. Freud) described the prayer as "villainous", a word which has been called into question. Perhaps it would be more apt to describe it as evil. If it were carried, it would condemn the BBC to a licence fee of £46, or perhaps nothing. It would certainly provide for no increase. However, Labour members have sought to defend the BBC. This is almost unbelievable. Why should such mischief be caused by those who are the defenders of the BBC?

The hon. Member for Walsall, North (Mr. Winnick) referred to concessions for old-age pensioners. He did so without regard to their means. Not all old-age pensioners are on the basic old-age pension. Some of them, including retired Prime Ministers, are quite well off and can afford to pay a BBC licence fee. We should protect old-age pensioners and the needy by providing a DHSS test to ensure that a concession is given to those who need it most. We must help the needy and reform the present system, but we must consider closely the entire broadcasting system if we are to contemplate change.

The £58 fee is becoming too high a target for too many people. The average income is stretched to find such a sum once a year. I applaud what has been said about weekly or monthly payments, which are a way round it, but we must ask whether we should use a compulsory tax, called a licence fee, to provide bread and circuses, chocolates and light entertainment, to quite the extent that the BBC does. We should ask whether we want the BBC to go into every new piece of electronic progress. Such issues must be considered when we are discussing the financing of the BBC and the rate of the licence fee.

I am adamant that any attempt to make the BBC advertise would be doomed to failure in terms of the quality of the BBC's programmes and the rest of the advertising world. That is not the way forward, but the Peacock committee will take evidence from many people. The way forward is to be constructive and to question whether, with multi-choice, people are prepared to pay a compulsory levy. We must ask whether we should find some other means, such as a subscription, and back up a base licence fee set at a reasonable level with payments for services.

Time is short and I have gone on for too long. I hope that this is the first of many debates on the future of public service broadcasting.

11.10 pm

Mrs. Elaine Kellett-Bowman (Lancaster)

When the increased fee was announced on 27 March the opposition to the increase was strong on this side of the House. I am astounded that the hon. Member for Knowsley, North (Mr. Kilroy-Silk) scarcely dealt with the hardship that will arise for the old and other low-paid people in the north-west if the increase goes ahead. I am astounded, if the rumour is correct, that the Opposition do not intend to divide the House. If they do not believe in the regulations, to which the hon. Gentleman hardly referred, they should at least have the courage to stand up and vote. As it is, precisely two Labour Back Benchers are present.

I should like some information about how the BBC is spending its money. I should like to know whether it is true that 200 members of BBC staff or, as has been suggested in another newspaper, a mere 140, are to cover the snooker championships in Sheffield. If so, why should the elderly and low-paid in my constituency pay for such gross overmanning? I agree entirely with those of my right hon. and hon. Friends who have said that there should not be such overmanning.

Advertising is not the only alternative. Economy should be the watchword. If the BBC is to economise, it should do so not on invaluable services, such as overseas broadcasting, but on the frills. It should concentrate on what it does so well and leave the rest to others. I am utterly opposed to the increase in the fee and hope that there will be a Division so that hon. Members who feel as I do can vote against the regulations.

11.13 pm

Mr. Peter Griffiths (Portsmouth, North)

When the regulations increasing the licence fee to £46 were introduced, I gave notice that I would not support any further increase in the fee unless there was clear evidence of the BBC actively seeking alternative sources of financing to cover at least part of its programmes. There is not the slightest evidence of such an attempt. The BBC has decided that it can rely on Parliament to provide it with a licence fee which will allow it to go on with its present programming.

It has been said consistently that there is something peculiarly British about the BBC and that there is an especially high quality which must be defended. One of the most significant television experiences of the past few months was "The Jewel in the Crown". That was not on BBC, which screened a cheap and nasty import called "The Thorn Birds." It was not on ITV that only a week or so ago a pop singer pulled down his trousers and exposed himself: that occurred on BBC, for which we are told that higher standards operate. It was not ITV which pirated a news broadcast only today; it was the BBC, whose standards are supposed to be so high that we would do damage if we introduced an element of the commercial.

My constituents believe that an increase in the licence fee to £58 is too much. That licence fee will operate for two years, and the Peacock committee will report in the meantime. Undoubtedly the BBC will claim, "We shall have to take a very long time considering and discussing it," and there will be yet another increase. That is unacceptable.

There should have been a simple, straightforward statement that the licence fee would be held at its present level, plus an increase of 5 per cent. for this year's inflation and that, within 12 months, the BBC should come forward with its own proposals for raising the rest of its revenue after that time. By doing so, we would have concentrated the BBC's mind wonderfully and seen the way ahead.

I trust that there will be a Division so that we can flush out Opposition Members who had the gross gall to talk about a concessionary licence fee when they know darn well that none of their hon. Friends is present to vote for it. I also hope that there will be a Division so that the 50 or more Conservative Members who signed an early-day motion opposing an increase in the licence fee will have a chance to show just how serious they are.

11.17 pm

Mr. David Maclean (Penrith and The Border)

As a Conservative Member who signed the early-day motion, I came here fully intending to vote for the prayer, but when I heard the hon. Member for Knowsley, North (Mr. Kilroy-Silk) deliver his piece, I decided that there was no way in which I could go into the same voting Lobby as the hon. Gentleman.

I then discovered that the Opposition will not even press the prayer to a vote. The Opposition Front Bench are not supported by any of their Back-Bench colleagues. Tonight has been an exercise in sheer political humbug by the Opposition. They have promised the old-age pensioners that if they vote Labour at the next election they will not have to pay for a licence fee, without mentioning where the money will come from. We know that by the time the next election is held the Labour party's research department and all its pressure groups will have said, "Hang on a moment. There are others who ought to be included. What about the unwaged who are earning less than pensioners? What about those in the minority rights group?" In the end almost everyone will be exempt, and only 2 million people will be paying £200 a year for a TV licence. Labour's promise will be that everyone will be exempt and that the paternalistic Labour party will hand out free TV licences.

Two things concern me about the proposed increase to £58. First, it is three times above the rate of inflation, certainly in the two-year period, and above the predicted rate of inflation in the three-year period. I am one of those poor Back-Benchers who were not able to see the 200 pages of the Peat Marwick report which the BBC suppressed. There may be very good reasons why I should not be able to see it.

Mr. Brinton

In fact, the Peat Marwick report was published and placed in the Library, with one or two bits left out.

Mr. Maclean

I apologise if 200 pages were not suppressed, but perhaps the one or two bits that were left out would have helped hon. Members to conclude, "Yes, we will vote for a £58 licence fee." It is no good the BBC saying, "Trust us, we are efficient and we need this for our future expansion and development. Here are the reasons, but we shall not tell you why," especially when Peat Marwick Mitchell had to step in the day after the report was published to correct some of the misleading information which had been issued by the BBC. So much for high standards of reporting and broadcasting.

Secondly, I believe that the time scale is slightly too lax. I welcome what my right hon. and learned Friend has done. I called for an inquiry into the scope, nature and financing of the BBC. The inquiry is to be welcomed, and I congratulate my hon. Friend on initiating it. It is not appropriate for us to talk in depth about advertising in the BBC or other forms of sponsorship. The inquiry must determine that. I am worried that after the inquiry reports in August 1986 there will be months of consultation, it will be found appropriate for the Government to issue a Green Paper, and we shall then discover that we are in the runup to a general election or that a new licence fee is required. That would be iniquitous. I agree that we should then say to the BBC, "I am sorry, but we shall cut off your licence fee and impose a new system." We must give it a run-in, and to do that we must have a shorter inquiry and a full investigation of the BBC. Let us find a system so that we can put into force alternative methods of funding by the time of the next licence fee inquiry.

I must tell Opposition Members that my right hon. and hon. Friends and I also wish to see pensioners and the low-paid exempt from the fee. The way to achieve that is not to force others to pay an exorbitant fee, but to freeze the fee at its present level while we find alternative methods of propping up the BBC's finances. We must be fair to everyone and not dish out licences like a social service. If the hon. Member for Knowsley, North and his two hon. Friends who remain present have any courage or political integrity, they will force the issue to a vote. They should not go round the country afterwards saying, "We put down a prayer which opposed the terrible increase in the licence fee and, oh, if only you had voted for us we would have given you free television licences". That would be deplorable. They should have the courage to vote tonight.

11.21 pm

The Minister of State, Home Office (Mr. Giles Shaw)

I regret that, because we have lost some time, it will not be possible to hear further speeches from my right hon. and hon. Friends, many of whom wished to participate. The debate is being held in the most absurd circumstances possible — on a prayer, with few performers in the church. The remarks of the hon. Member for Knowsley, North (Mr. Kilroy-Silk) were scarcely worth noting, except for one passage in which he quoted accurately from a rather brilliant speech that I made in December on these issues. I found that thoroughly acceptable, and recommend it to my hon. Friends.

The important speeches have come entirely from this side of the House. I face the ranks of Tuscany, and happily they are not evident. Those of my hon. Friends who have taken the issue seriously from the word go, have once again demonstrated their genuine anxiety about the progress of the BBC's financing.

The Government's role in judging what should be a correct settlement of fee occurs every three years under the present arrangement. During that period there will inevitably be considerable pressure about what a Government should do at the vital moment of reappraisal. I thank my hon. Friends who have made their views known loudly and clearly. It is certainly in view of all that they have said that my right hon. and learned Friend has made this year's settlement of such a special character.

First, I shall seek to justify to my hon. Friends the size of the increase that has been made. I fully understand that an increase from £46 to £58 cannot be accepted easily, especially by those who are living on fixed incomes. However, as I suspect my hon. Friends are aware, the three-year licence settlement which preceded this proposal means that, at the end of the period, the corporation was running not at a £46 licence fee equivalent, but at a £51 licence fee equivalent. That is inevitable if one seeks to establish a flat fee for a long period. During the first year the corporation was running at about £50 million below the licence fee generation, during the second it was equal to that generation, and in the third it exceeded that generation.

It is perfectly true that during that period the corporation was also increasing its services and seeking to offer greater value for the money that it was asking the viewer to pay—as many Conservative Members would wish. It is not reasonable for my hon. Friends to say that the job of the Government is to produce a licence fee and then to determine how to manage the BBC. There is no way in which the House, or indeed the Government, would wish to run the corporation and take over the role of the governors and the executive. I do not believe that that is what Conservative Members wish.

However, hon. Members expect the Government to provide for the next period major changes in the way in which the corporation should use its licence income, partially because they recognise that there is a significant alteration in the efficiency and productivity of the corporation. Therefore, my right hon. and learned Friend suggested that an independent inquiry should be held into its efficiency, and Peat Marwick Mitchell reported. I should make it clear that the £58 fee now proposed requires the corporation, bearing in mind its application for £65, to run the existing services at a higher rate of productivity than that which Peat Marwick Mitchell recommended in its specific objectives. It will require the corporation, which said in its application that a £60 licence fee equivalent is required to run existing services, to create a further improvement in productivity.

Secondly, when it comes to making a further extension, whether it be in development or in new services, the corporation must find existing services that can be covered by internal efficiencies and savings.

Therefore, during the next three-year period for which the licence fee has been set, there will have to be significant changes in the productivity and efficiency of the corporation. My hon. Friends were anxious to ensure that that should be part of the settlement, to determine once and for ever that there is no divine right suddenly to determine by application that the fee requested should be accepted under the threat that there would be major changes in what the corporation must do. The fact remains that the fee settlement, in relation to what the corporation sets out to do, is extremely tough. As Mr. Milne said to us the other day, having to forgo £350 million worth of revenue during a three-year period has required the corporation to take seriously into account the requirements for improved productivity and efficiency.

To deal with the licence fee period, my hon. Friend the Member for Hertfordshire, West (Mr. Jones), who I thought made a most trenchant contribution to the debate, asked about the time scale of Peacock and the relevance of the two or three-year licence period. I remind him that my right hon. and learned Friend the Secretary of State, in his licence fee statement, said: I have therefore decided that the present licence fee settlement should be for a period of two years with the intention that any possible changes in the system of financing broadcasting should be considered in the light of the committee's report before the licence fee falls to be further renewed. But if decisions cannot be made in the light of the report within two years, or if it is decided there should be no change to the system, this settlement will run for a third year with the licence fee continuing at the rates I am announcing today."—[Official Report, 27 March 1985; Vol. 76, c. 480.] I hope that my hon. Friend recognises that there is a possibility—I trust that it will be more than that—of the Peacock committee's report running to time, which means that it will be published by the middle of next year. That would influence the third year which my right hon. and learned Friend announced on 27 March. I fully accept the importance that my hon. Friend attaches to that objective.

My hon. Friend and several other hon. Members asked about the inflation rate. I must tell him that the inflation rates within the television industry are substantial, as he will know. The House must recognise that this is not wholly of the corporation's making. There is a large question mark over the pressures on costs that are presently exerted in the ITV system. Hence, the Government's review of the structure of the levy could have an important role to play, because the terms of reference of that review suggest that we are not entirely satisfied that the present structure of the levy does not result in cushioning ITV companies against resisting cost pressures. That, too, will be an important consideration when we consider further financing objectives for the corporation.

Finally, in reaction to the Peacock committee, many of the comments made have referred to whether there should be change. But what I trust the debate has demonstrated beyond doubt is the crucial importance that this matter be properly examined. My right hon. and learned Friend the Member for Warrington, South (Mr. Carlisle) was right to say that the Peacock committee's examination must be done carefully, not rashly or wantonly. I assure the House that the Peacock committee, in its terms of reference, has been given a wide range of options, which will ensure that many of the propositions that have been suggested by hon. Members in their anxiety to move quickly to advertising in this or that section of the corporation will be taken on board by the committee and by the Government. The Government, not the corporation, will receive that report, and the corporation, I point out to my hon. Friend the Member for Portsmouth, North (Mr. Griffiths), is not a party to the decision-making of that committee. That is the way in which we shall examine this matter.

With a licence fee settlement that, at the very best, is to remain unchanged for three years, and has been arrived at with a much tougher rein on the productivity and efficiency of the corporation, with the Peacock committee genuinely looking at alternative sources of funding—

It being half-past Eleven o'clock, Mr. DEPUTY SPEAKER put the Question, pursuant to Standing Order No. 4 (Prayers against statutory instruments, &c. (negative procedure)).

The House divided: Ayes 9, Noes 290.

Division No. 187]	[11 30 pm
AYES
Dicks, Terry	Stevens, Lewis (Nuneaton)
Harris, David	Whitfield, John
Jones, Robert (W Herts)
Kellett-Bowman, Mrs Elaine	Tellers for the Ayes:
Maclean, David John	Mr. Peter Griffiths and
Maxwell-Hyslop, Robin	Mr. Eldon Griffiths.
Shepherd, Richard (Aldridge)

NOES
Adley, Robert	Bellingham, Henry
Aitken, Jonathan	Bendall, Vivian
Alexander, Richard	Biffen, Rt Hon John
Alison, Rt Hon Michael	Biggs-Davison, Sir John
Amess, David	Blackburn, John
Ancram, Michael	Blaker, Rt Hon Sir Peter
Arnold, Tom	Body, Richard
Ashby, David	Bonsor, Sir Nicholas
Aspinwall, Jack	Bottomley, Peter
Atkins, Rt Hon Sir H.	Bottomley, Mrs Virginia
Atkins, Robert (South Ribble)	Bowden, A. (Brighton K'to'n)
Atkinson, David (B'm'th E)	Bowden, Gerald (Dulwich)
Baker, Rt Hon K. (Mole Vall'y)	Boyson, Dr Rhodes
Baker, Nicholas (N Dorset)	Braine, Rt Hon Sir Bernard
Baldry, Tony	Bright, Graham
Batiste, Spencer	Brinton, Tim
Beith, A. J.	Brittan, Rt Hon Leon

Brooke, Hon Peter	Hargreaves, Kenneth
Bryan, Sir Paul	Haselhurst, Alan
Buchanan-Smith, Rt Hon A.	Havers, Rt Hon Sir Michael
Buck, Sir Antony	Hawkins, C. (High Peak)
Budgen, Nick	Hayes, J.
Bulmer, Esmond	Hayhoe, Barney
Burt, Alistair	Hayward, Robert
Butcher, John	Heathcoat-Amory, David
Butler, Hon Adam	Heddle, John
Butterfill, John	Heseltine, Rt Hon Michael
Carlisle, John (N Luton)	Higgins, Rt Hon Terence L.
Carlisle, Kenneth (Lincoln)	Hind, Kenneth
Carlisle, Rt Hon M. (W'ton S)	Hirst, Michael
Cash, William	Hogg, Hon Douglas (Gr'th'm)
Chalker, Mrs Lynda	Holland, Sir Philip (Gedling)
Channon, Rt Hon Paul	Holt, Richard
Chapman, Sydney	Hordern, Peter
Clark, Dr Michael (Rochford)	Howard, Michael
Clark, Sir W. (Croydon S)	Howarth, Alan (Stratf'd-on-A)
Colvin, Michael	Howell, Rt Hon D. (G'ldford)
Conway, Derek	Howell, Ralph (N Norfolk)
Coombs, Simon	Hubbard-Miles, Peter
Cope, John	Hunt, David (Wirral)
Corrie, John	Hunt, John (Ravensbourne)
Couchman, James	Hunter, Andrew
Cranborne, Viscount	Jenkin, Rt Hon Patrick
Crouch, David	Jessel, Toby
Currie, Mrs Edwina	Johnson Smith, Sir Geoffrey
Dickens, Geoffrey	Jones, Gwilym (Cardiff N)
Dorrell, Stephen	Jopling, Rt Hon Michael
Douglas-Hamilton, Lord J.	Joseph, Rt Hon Sir Keith
Dunn, Robert	Key, Robert
Durant, Tony	King, Roger (B'ham N'field)
Dykes, Hugh	King, Rt Hon Tom
Edwards, Rt Hon N. (P'broke)	Knight, Gregory (Derby N)
Evennett, David	Knowles, Michael
Eyre, Sir Reginald	Knox, David
Fallon, Michael	Lamont, Norman
Farr, Sir John	Lang, Ian
Favell, Anthony	Latham, Michael
Fenner, Mrs Peggy	Lawler, Geoffrey
Finsberg, Sir Geoffrey	Lawrence, Ivan
Fletcher, Alexander	Lee, John (Pendle)
Forman, Nigel	Leigh, Edward (Gainsbor'gh)
Forth, Eric	Lennox-Boyd, Hon Mark
Fowler, Rt Hon Norman	Lewis, Sir Kenneth (Stamf'd)
Fox, Marcus	Lightbown, David
Fraser, Peter (Angus East)	Lilley, Peter
Freeman, Roger	Lloyd, Peter, (Fareham)
Freud, Clement	Lord, Michael
Gale, Roger	Luce, Richard
Galley, Roy	Lyell, Nicholas
Gardner, Sir Edward (Fylde)	McCrindle, Robert
Garel-Jones, Tristan	McCurley, Mrs Anna
Gilmour, Rt Hon Sir Ian	Macfarlane, Neil
Goodlad, Alastair	MacGregor, John
Gorst, John	MacKay, Andrew (Berkshire)
Gow, Ian	MacKay, John (Argyll & Bute)
Gower, Sir Raymond	McNair-Wilson, P. (New F'st)
Greenway, Harry	McQuarrie, Albert
Gregory, Conal	Madel, David
Grist, Ian	Major, John
Ground, Patrick	Malins, Humfrey
Grylls, Michael	Malone, Gerald
Hamilton, Hon A. (Epsom)	Maples, John
Hanley, Jeremy	Marlow, Antony
Hannam, John	Marshall, Michael (Arundel)

Maude, Hon Francis	Sims, Roger
Mawhinney, Dr Brian	Skeet, T. H. H.
Mayhew, Sir Patrick	Smith, Sir Dudley (Warwick)
Meadowcroft, Michael	Smith, Tim (Beaconsfield)
Mellor, David	Soames, Hon Nicholas
Merchant, Piers	Spence, John
Meyer, Sir Anthony	Spencer, Derek
Miller, Hal (B'grove)	Spicer, Jim (W Dorset)
Mills, lain (Meriden)	Spicer, Michael (S Worcs)
Miscampbell, Norman	Squire, Robin
Mitchell, David (NW Hants)	Stanbrook, Ivor
Moate, Roger	Stanley, John
Monro, Sir Hector	Steel, Rt Hon David
Moore, John	Steen, Anthony
Morris, M. (N'hampton, S)	Stern, Michael
Morrison, Hon C. (Devizes)	Stevens, Martin (Fulham)
Morrison, Hon P. (Chester)	Stewart, Allan (Eastwood)
Murphy, Christopher	Stewart, Ian (N Hertrdshire)
Neale, Gerrard	Stokes, John
Needham, Richard	Stradling Thomas, J.
Nelson, Anthony	Sumberg, David
Neubert, Michael	Taylor, John (Solihull)
Newton, Tony	Taylor, Teddy (S'end E)
Nicholls, Patrick	Temple-Morris, Peter
Norris, Steven	Terlezki, Stefan
Onslow, Cranley	Thatcher, Rt Hon Mrs M.
Oppenheim, Rt Hon Mrs S.	Thomas, Rt Hon Peter
Osborn, Sir John	Thompson, Donald (Calder V)
Page, Richard (Herts SW)	Thompson, Patrick (N'ich N)
Patten, J. (Oxf W & Abdgn)	Thornton, Malcolm
Pattie, Geoffrey	Thurnham, Peter
Pawsey, James	Tracey, Richard
Percival, Rt Hon Sir Ian	Trotter, Neville
Pollock, Alexander	van Straubenzee, Sir W.
Porter, Barry	Viggers, Peter
Portillo, Michael	Waddington, David
Powell, William (Corby)	Wakeham, Rt Hon John
Powley, John	Waldegrave, Hon William
Prentice, Rt Hon Reg	Walden, George
Price, Sir David	Walker, Bill (T'side N)
Prior, Rt Hon James	Wall, Sir Patrick
Proctor, K. Harvey	Waller, Gary
Pym, Rt Hon Francis	Walters, Dennis
Raffan, Keith	Ward, John
Rathbone, Tim	Wardle, C. (Bexhill)
Rees, Rt Hon Peter (Dover)	Warren, Kenneth
Rhodes James, Robert	Watson, John
Ridsdale, Sir Julian	Watts, John
Roberts, Wyn (Conwy)	Wells, Bowen (Hertford)
Roe, Mrs Marion	Wheeler, John
Rumbold, Mrs Angela	Whitney, Raymond
Ryder, Richard	Wiggin, Jerry
Sackville, Hon Thomas	Wilkinson, John
Sainsbury, Hon Timothy	Wolfson, Mark
St. John-Stevas, Rt Hon N.	Wood, Timothy
Sayeed, Jonathan	Woodcock, Michael
Scott, Nicholas	Yeo, Tim
Shaw, Giles (Pudsey)	Young, Sir George (Acton)
Shaw, Sir Michael (Scarb')	Younger, Rt Hon George
Shelton, William (Streatham)
Shepherd, Colin (Hereford)	Tellers for the Noes:
Shersby, Michael	Mr. Carol Mather and
Silvester, Fred	Mr. Robert Boscawen.

Question accordingly negatived.