HC Deb 13 July 1984 vol 63 cc1465-9
Mr. Peter Shore (Bethnal Green and Stepney)

(by private notice) asked the Minister for Information Technology whether he will make a statement on the takeover of the Mirror Group by Mr. Robert Maxwell's Pergamon company.

The Minister for Information Technology (Mr. Kenneth Baker)

It is reported today that Reed International plc. has agreed in principle to sell Mirror Group Newspapers Ltd. to Pergamon Press Ltd. On the basis of the information available to me, this sale does not involve a transfer of a newspaper to a newspaper proprietor. It would accordingly not require the consent of the Secretary of State under section 58 of the Fair Trading Act 1973. It will, however, fall for consideration under the general merger provisions of the Act.

Mr. Shore

I am grateful to the Minister for his statement. Did he consult the Director General of Fair Trading about this important takeover? What advice did he receive from the Director General? Does not the hon. Gentleman agree that, in the case of newspapers, whose editorial independence and wide spectrum of opinion are very much in the national interest, it is undesirable that proprietors should be able to obtain total command without enforceable guarantees and restraints of major newspapers?

In the light of the recent experience of Rupert Murdoch's dismissal of the editor of The Times, Mr. Tiny Rowland's intimidation of The Observer, and now the change of ownership of the Mirror Group, does the hon. Gentleman not think that the time has come for a major review and strengthening of the legislation?

Mr. Baker

My right hon. Friend the Secretary of State for Trade and Industry has yet to receive the advice of the Director General of Fair Trading on the question of the merger policy, and any decision will be made in the light of that advice. We have examined the responsibilities of the Secretary of State with regard to sections 57 and 58 of the Fair Trading Act, and I have set that out clearly in my statement. We expect to receive the advice of the Director General on the matter of general policy and competition policy. Because no consent is required on newspaper grounds, conditions of consent do not arise in this matter, as I believe the right hon. Gentleman, who has had responsibility in these matters, knows.

I have noticed that this morning Mr. Maxwell said that he gave certain undertakings to the Reed International Group about the future editorial policy of that group and the matter of employment. I heard him on radio this morning talking about his plans for expansion.

Dr. David Owen (Plymouth, Devonport)

Does the Minister agree that the crucial question for the House is the concentration of newspaper power in the hands of one proprietor and that many people believe that it was wrong to allow Mr. Rupert Murdoch to acquire such a large concentration of power? I am not criticising the takeover of the Mirror Group, but I believe that it would be most objectionable if Mr. Maxwell were able to extend his empire by increasing his share of the Express newspapers. Will the Government assure the House that if the Mirror Group takeover is accepted they will not allow the same concentration of power to accrue to Mr. Maxwell as has been allowed to accrue to Mr. Murdoch?

Mr. Baker

The right hon. Gentleman is on a fair and good point — that the Government do not concern themselves with the ownership of newspapers. other than with the concentration of power. According to the advice that I and my officials have received about this merger, that matter does not arise at this stage. Should it arise in future, and should Mr. Maxwell increase his interests in various other newspaper groups, especially above the 25 per cent. level, it would certainly come under sections 57 and 58 of the Act.

Mr. Peter Bottomley (Eltham)

Does my right hon. Friend agree that it is ludicrous for the House of Commons to be totally involved in every newspaper transfer and that what is needed, if it were possible, is not a reference to the Office of Fair Trading about newspaper ownership, but an underlying change in newspaper production techniques, restrictive practices and overmanning so that there are more profitable newspapers and more people come into the industry, thereby breaking down the implicit monopolies of small numbers of people holding large numbers of newspapers?

Mr. Baker

My hon. Friend is correct. The problems of Fleet street will be solved or mitigated not by transfers of ownership but only by addressing the major problems in the operation of Fleet street. [Interruption.] There are many workers' problems in Fleet street. It is just as well that the rest of the printing industry does not operate on the same basis as Fleet street.

Mr. Willie W. Hamilton (Fife, Central)

Is the Minister aware that since the Mirror Group owns popular Scottish newspapers such as the Daily Record and the Sunday Mail there will be great trepidation at the prospect of Mr. Maxwell obtaining control of those newspapers? Will the hon. Gentleman urge the Chancellor of the Exchequer to use the new fraud investigation group to have a hard look at the financing of this empire, because I understand that the group has headquarters in Liechtenstein, a tax haven, which may be worth investigating? Will the hon. Gentleman consider setting up a Royal Commission on the way in which newspapers are owned and controlled, because there is great worry among the public as a whole at the fact that people such as Mr. Maxwell can get their hands on important media factors? Will the hon. Gentleman urgently consider that matter?

Mr. Baker

I believe that that is the first time that the hon. Gentleman has asked for a Royal Commission, and I welcome his conversion. I am surprised that the hon. Gentleman has been so hard about his former parliamentary colleague, whom my hon. Friend the Member for Oxford, West and Abingdon (Mr. Patten) assures me is still a member of the Oxford Labour party. Mr. Maxwell has given certain undertakings about editorial freedom. He has said that the existing political stance of the Mirror Group will be maintained.

Mr. Harry Greenway (Ealing, North)

I note what my hon. Friend has just said about editorial freedom and what he said earlier. Is it not the case that Mr. Maxwell need not have given any assurance on editorial policy, but the fact that he has done so and the way in which he has spoken mean that he seems to be prepared to enter into negotiations on editorial policy with his employees in the Mirror Group?

Mr. Baker

Mr. Maxwell has been frank about his interests in that group and the way in which he intends to operate it. That statement was widely reported today in the newspapers and on television and radio. Mr. Maxwell has not only given undertakings about the maintenance of the editorial stance, but has spoken this morning of opening a new London evening newspaper.

Mr. David Winnick (Walsall, North)

Is the Minister aware of the widespread dismay at Mr. Maxwell's takeover of the Mirror Group and the increasing concentration of newspaper ownership in the hands of private individuals? Bearing in mind what has happened recently with Mr. Murdoch, Mr. Rowland and now Mr. Maxwell, is it not clear that the state of the British press is sick and that some form of inquiry is necessary? It is intolerable that more and more newspapers are being opened by private individuals with massive wealth and political ambitions.

Mr. Baker

If Fleet street is sick, it is not due to individual newspaper proprietors. They come along for a variety of reasons and acquire interests in newspapers and keep them going, when that is often against normal commercial judgment. The sickness of Fleet street is quite profound. In my view, and the view of many people, it relates very much to working practices and activities that have been perpetrated in Fleet street for a long time.

Mr. Clement Freud (Cambridgeshire, North-East)

Although one is, of course, concerned about the amount of power that one man will have, will the Minister welcome the self-made man rather than a second or third-generation newspaper tycoon? Does he accept that Mr. Maxwell has had more success in his dealings with the unions than the Prime Minister?

Mr. Baker

I do not think that the Government have a view on first or second-generation tycoons, but certainly Mr. Maxwell has assembled a very large group, he has operated successfully, and he has made known his interest in the acquisition of a newspaper. As it stands at the moment, that is not a concentration of newspaper power, and that is the concern of the Government.

Mr. Timothy Yeo (Suffolk, South)

Does my right hon. Friend agree that it is most welcome that someone with Mr. Maxwell's proven entrepreneurial ability is coming into newspaper proprietorship in Fleet street? Will my right hon. Friend further agree that the real reason why Labour Members may be opposed to the acquisition is that they fear that good management will start to expose even more clearly the appalling restrictive practices in Fleet street? There is no need to suppose, from Mr. Maxwell's record, that he will interfere with editorial policy.

Mr. Baker

I am a little puzzled at the attitude of the Labour party, because the alternative to Mr. Maxwell's group acquiring the newspaper would be for the company to go to the London capital markets—to the dreaded, horrid City—to raise money for the future development of the group. Indeed, the independence or survival of the Mirror Group may be better secured by being within a framework of larger resources than by having to go back to shareholders when times get difficult.

Mr. Tom Cox (Tooting)

Is the Minister aware that there is great concern as to the power that Mr. Maxwell will now have? Is it the Minister's intention to seek an early meeting with Mr. Maxwell to try to find out exactly what his policy will be? Other people heard Mr. Maxwell's comments on the radio, and I am sure that the Minister must be aware that there is great doubt as to what Mr. Maxwell intends to do.

Mr. Baker

I do not particularly want to meet Mr. Maxwell—that is not a personal comment—beause it is not part of Government policy to try to determine and impose conditions in situations of this sort, where a concentration of ownership is not involved. Conditions of consent arise only where there is a concentration of ownership, and that is not the concern in this case.

Mr. Tony Blair (Sedgefield)

Is not the real problem that there will be concentration in one individual of ownership of a major group of newspapers, with no enforceable guarantee of editorial independence? Will the Minister agree that one must be concerned when newspapers are to be owned by an individual who gives unenforceable guarantees of independence, and who was reported in the Sunday Times a few weeks ago as saying that, had he been in charge of The Observer when the story about the Prime Minister's son was published, he would have sacked the editor? Therefore, what credibility can be given to Mr. Maxwell's guarantees?

Mr. Baker

I shall not be drawn into discussion of the editorial policy of The Observer. Certain undertakings have been given by Mr. Maxwell. His clear intention, expressed over several months if not years, has been to own a newspaper broadly supportive of the views of the Labour party. He has remained a supporter of the Labour party, and I am very surprised at the concern felt by hon. Gentlemen.

Mr. David Alton (Liverpool, Mossley Hill)

Is the Minister concerned that so much of Fleet street should now be owned by small clutch of millionaires intent on satisfying a "Citizen Kane" fantasy? Does he agree that there should be much wider diversification of ownership? Will he consider introducing legislation to prevent any individual from owning more than 20 per cent. of any national newspaper?

Mr. Baker

There are limitations, under existing legislation, on the concentration of ownership. The ownership of Fleet street newspapers has always been diverse, varied and interesting in its pattern. It has changed over the generations and over the decades, and it will ever be so. There is a strange motivation among people to own newspapers. I think that many people in the rest of the business world are rather surprised that people should actually want to own newspapers.

Mr. Shore

The Minister has referred to Mr. Maxwell's guarantees and, of course, we expect them to be maintained. Is the Minister content — this is the policy point—with a 1973 Act under which a major newspaper can pass into the hands of a single person without any need for guarantees to be given? Secondly, even where guarantees are given, as in the cases of The Times and The Observer, they can apparently be flouted without any consequences for those who do it.

Mr. Baker

The right hon. Gentleman asked whether general Government policy over the years, irrespective of which party was in power, has been appropriate. I should think that we have the balance about right. It would be very wrong for Governments to intervene in the ownership of newspapers and control them. That is a slippery path and Governments would be led further and further down it. It would lead eventually to editorial influence and control by Governments. I do not want to go down that path. I believe that the legitimate concern of the House arises when there is a concentration of ownership. In this case, I have 'said that we do not believe that there is such concentration.

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