Broadcasting Licences

HC Deb 24 April 1991 vol 189 cc1149-83

8 pm

The Parliamentary Under-Secretary of State for the Home Department (Mr. Peter Lloyd)

I beg to move, That the draft Broadcasting (Restrictions on the Holding of Licences) Order 1991, which was laid before this House on 28th March, be approved. The order is made under the powers contained in schedule 2 to the Broadcasting Act 1990. Its purpose is to supplement the broadcasting ownership rules contained in schedule 2 by introducing certain additional provisions which, no doubt to the relief of the House, I shall summarise rather than rehearse in full.

The provisions in the draft order that are, I suspect, of most immediate interest to the House are those relating to the circumstances in which two regional Channel 3 licences can be co-owned. The order provides, first, that two such licences may not be co-owned if they are both large. For these purposes, we have designated the top nine, in terms of advertising revenue, as large, and the remaining six as small.

When the Government originally announced their decisions on the ownership of Channel 3 licences, we said that, in addition to ruling out co-ownership of two large licences, we planned also to prohibit co-ownership of two licences for adjacent areas. This became known somewhat inelegantly as the contiguity rule. At that stage, the Independent Television Commission had not set out the number or shape of Channel 3 regions that it was going to advertise. However, we were working on the basis that, if the ITC was minded to retain the existing ITV map—which it has now said that it intends to do—we would expect only the top six to be designated as large.

In making general provision for one person to hold two Channel 3 licences, we recognised that in some cases such an arrangement could result in sensible economies of scale without threatening regional identity. We were, however, anxious to avoid circumstances in which licences covering an unacceptably large part of the country were held in common ownership. The proposed ban on contiguous ownership was intended to meet that concern.

We decided, on further reflection, that to impose a contiguity rule of that kind for the full 10-year licence period might be counter-productive, in that it could prevent some combinations of ownership which offered scope for sensible economies of scale, and were therefore potentially attractive in commercial terms.

Indeed, given the uncertainties of the broadcasting environment in the 1990s, I simply do not believe that it would have been practicable to rule out for all time the possibility of contiguous mergers which might, under some circumstances, be in the best interests of all concerned, especially the viewers.

Simply to have dropped the contiguity rule, while retaining only six large areas would, however, have left the way open for combinations of ownership which could give an unhealthy dominance to a single company. We therefore decided that if, in the longer term, there was to be no separate contiguity rule, it was right to increase the number of regions to be designated as "large" from six to nine, and the draft order so provides.

In response to strong representations that we received from various quarters on the contiguity issue, we have also accepted that we should offer some reassurance to the smaller companies that they will not risk being outbid by predatory neighbours before they have the opportunity to establish themselves. Therefore, we decided that a contiguity rule should apply during the bidding process for the new Channel 3 licences.

The effect will be that a single person or company cannot win two licences for adjacent areas. This restriction will, however, be lifted as soon as the relevant licences have been granted, at the end of this year or early next. From then on, there will be no specific ban on contiguous takeovers, but takeovers of all kinds will, of course, be subject to the general moratorium on takeovers imposed by section 21 of the 1990 Act.

Under that provision, takeovers can take place until the end of 1993 only with the consent of the ITC. The ITC is likely to give consent to takeover or merger proposals during that period in certain circumstances, such as where one of the licensees was in serious financial difficulties, or where a planned merger had the joint agreement of both parties. Hostile takeovers, on the other hand, would almost certainly be ruled out.

I should emphasise that our decision on contiguity does not imply that, at the end of the moratorium period, any or all of the smaller regions will necessarily be co-owned by a company holding a larger region. Moreover, where one company holds two licences, it will still be obliged to meet in full the separate regional requirements for each of the two regions.

The chairman of the ITC is in full agreement with our proposal, and considers that the ITC will have no difficulty in ensuring that where licence areas are co-owned, the licensee provides distinctive local programming for each region.

Mr. Robert Maclennan (Caithness and Sutherland)

If the separate requirements of individual regions have to be maintained—I understand that that is so as to maintain regional identity—how does the hon. Gentleman believe that there could be scope for the sort of economies of scale that might be the only justification for some sort of merger?

Mr. Lloyd

There could be economies in the use of a sales force or in some of the administrative back-up. There are a number of ways in which that might be achieved. However, what could not be altered is the undertaking made and enshrined in the licence about the type of regional programmes that would be provided, the number of hours, the time and the ITC's requirement that 80 per cent. of regional programming must be produced in the region either by the licence or independents. Therefore, there is a strong safeguard as regards regional broadcasting, but there is plenty of scope for economies of scale.

I believe that these provisions on co-ownership, while different in form from what we envisaged originally, are entirely consistent with the policy intentions that we announced during the passage of the Broadcasting Bill last Session. We continue to attach great importance to ensuring the preservation of the district regional identity of the Channel 3 licences and to the discharge by the licensees of their regional programming obligations, as I have just said.

The ITC has, as I have said, confirmed that it will be able to ensure that regional commitments are fulfilled, even when there is joint ownership of two contiguous licence areas. I am not surprised that it should have come to that conclusion, as the Broadcasting Act contains some very substantial safeguards.

For example, the Act requires that a sufficient amount of time should be given for regional programmes. That varies from licensee to licensee but generally it is more than has been the case in the arrangements to date. It follows that if, following the moratorium period, a single person were eventually to own two contiguous licence areas, he would not be permitted to treat them as one mega-region and transmit identical programmes in both areas. Neither could he, as some have feared, simply move the entirety of his programme production base to a single location and produce what purport to be separate regional programmes from there.

Mr. Robin Corbett (Birmingham, Erdington)

The Minister mentioned programme production bases, but perhaps he would confirm that the Act does not stipulate that regional programmes must be made in the region.

Mr. Lloyd

It is certainly stipulated in the requirements set by the ITC. To meet the quality threshold, a bidder must state that he will do that, and it will be written into his licence if he is successful. Therefore, we shall have a copper-bottomed undertaking.

Mr. John Greenway (Ryedale)

Does not the Bill strengthen the regional commitment of Channel 3 licensees by virtue of amendments passed in Committee? Those amendments will require licensees to demonstrate to the ITC what arrangements they are making for regional programmes, which must be made in the region.

Mr. Lloyd

That is right but, if my memory serves me correctly, the Bill did not specify what the figure would be. The ITC has since specified that it is to be 80 per cent., and that figure will be written into the licence agreements. If there is a takeover, the new owner must observe the agreement.

Mr. Austin Mitchell (Great Grimsby)

The issue is where and how such programmes will be made. It is right that there should be a regional commitment. The strength of ITV is that it sets up regional centures of excellence in television production. They are there because of the federal system. Now, there will be nothing to require those centres to be maintained. Programmes could be farmed out to independents nominally in the regions, and those centres of excellence and skill could be disbanded and eliminated.

Mr. Lloyd

Regional programmes will have to be made in the regions. That is not a nominal requirement. Eighty per cent. must be made there because, if not, a company would not be fulfilling the requirement laid down by the ITC, which will be included in the licence agreements.

Mr. Corbett

I wish to clarify one point. It is true that the ITC has stipulated that 80 per cent. of regional programmes should be made in the regions. However, let us be clear that regional programmes—again I speak from memory—may involve as few as five or six hours a week, although the bigger London stations may make more. Nevertheless, the lion's share of the 80 per cent. requirement in the Bill will involve only local news and current affairs. Therefore, some regions could be left with little more than a news studio.

Mr. Lloyd

I am sure that there will be much greater variety under the new arrangements. There will certainly be greater use of independents. Rather than programme-producing companies, we shall see publishing companies but, as the hon. Member for Birmingham, Erdington (Mr. Corbett) knows, 25 per cent. of ITV output will have to be taken from independents. Where those independents are based will be for them to decide. They will choose wherever they find it most convenient to be located and that is something that we cannot determine, nor should we seek to do so.

Although I understand the fear that the independents will inevitably gravitate to London, it will not necessarily prove to be soundly based. First, there are production facilities around the country. Secondly, other parts of the country are cheaper and thirdly, there is no doubt that a relationship with a regional licensee will be of interest to some independent contractors. Those factors will militate against the counter-attraction of London. However, the hon. Gentleman is right: the independents will locate themselves where, in business terms, they find it most sensible to be.

I deal now with the provisions in the order relating to further concentrations of interest in Channel 3 and Channel 5 licences. The Broadcasting Act 1990 sets out the maximum number of such licences which any one person may hold. The order introduces some additional restrictions. It provides that, once a person has acquired the maximum ownership in two regional Channel 3 licences in accordance with the Act or with the rules contained in this order, he may have a maximum shareholding of 20 per cent. in one further regional Channel 3 licence, provided that that does not constitute a controlling interest, and thereafter, no more than a 5 per cent. shareholding in further such licences. Similar rules apply in relation to national Channel 3 licences and Channel 5 licences.

The order also deals with newspapers shareholdings in broadcasting licences. It provides that national newspaper proprietors will not be permitted to have more than a 20 per cent. interest in any local radio licence, and that national or local newspaper proprietors will similarly be forbidden to hold more than 20 per cent. interest in a Channel 3, Channel 5 or domestic satellite service licence.

During the passage of the Broadcasting Bill through both Houses, there was considerable debate as to whether this rule should be extended to cover non-domestic satellite services. We argued then, and I continue to argue now, that it is neither necessary nor desirable for it to do so. Our policy rests on the fact that non-domestic satellite services have developed under different ground rules from terrestrial or domestic satellite services.

Domestic satellite services use broadcasting frequencies allocated by international agreement, of which only a small number—five at present—are available to the United Kingdom. In contrast, non-domestic satellite services like BSkyB face virtually open-ended scope for competition from a diversity of different channels in different hands transmitted from satellites such as Astra, which use telecommunications rather than broadcasting frequencies.

The relative ease with which new non-domestic satellite services can be introduced means that there is little danger of such services being controlled by a few major interests which might represent a threat to plurality of information sources. For that reason, we see no case for limiting newspaper investment in them. Were we to do so, of course, we should risk ending the extension of choice already brought about by such channels and jeopardising the 1,000 or so jobs which they have created in this country.

BSkyB does not have a monopoly on television services and we believe that competition among the terrestrial channels, BSkyB and other existing and future satellite televison services is sufficient to ensure editorial diversity.

Under the order, no public telecommunications operator will be permitted to have a controlling interest in any Channel 3, Channel 5, national radio or domestic satellite licence. I believe that it will be generally accepted that it would be undesirable to permit major telecommunications operators like British Telecom to control those key broadcasting licences.

Finally, the order makes provision for a points scheme to determine the maximum permitted ownership of local radio stations. All stations will be awarded points on the basis of their audience reach. It will be permissible to own stations which correspond to a maximum of 15 per cent. of the total number of points in the system, subject to the overall limit of 20 services contained in the Act.

This arrangement, which was announced in the course of proceedings on the Broadcasting Bill, is intended to take account of the likely growth in the number of local radio stations over the next few years, and of the great variety of individual stations, from the major ones such as Capital Radio and other large metropolitan stations, to the smallest community or ethnic services transmitting to a local neighbourhood.

These supplementary ownership rules, contained within the order, represent a reasonable and practical framework for regulatory control over the services which the ITC and Radio Authority will regulate. If the rules are approved by this House and in another place, we intend that they should come into effect as soon as possible. I commend the draft order to the House.

8.19 pm

Mr. Robin Corbett (Birmingham, Erdington)

I congratulate the Minister belatedly—referring to the date of his arrival rather than my congratulations. I believe that I am right in saying that this is the first broadcasting debate which the Minister has taken without someone whom I shall describe in a kindly way as his Svengali friend, who has now gone off to labour in the bowels of the Treasury as a reward for some small assistance that he rendered the Prime Minister during some stormy days in November.

Mr. Peter Lloyd

He is lurking about.

Mr. Corbett

I do not doubt that he is lurking about somewhere.

I thank the Minister for outlining the principal effect of the order. I wish to put three points to him. Of course it is true that the Independent Television Commission is advertising the Channel 3 regional licences on the basis of the existing map. However, there is no guarantee that each of the areas will attract bids. I say that seriously. It would be invidious to name areas which might attract negative bids. What thought, if any, has the Minister or, indeed, the ITC given to that possibility? It touches on the changes that he has made in the rule on contiguity.

I understand the protection which the Minister has put in place and which will remain until the bidding system is over. But the risk must remain—this was touched on in some of the interventions that the Minister was kind enough to take—as my hon. Friend the Member for Great Grimsby (Mr. Mitchell) said, that, if ownership of a certain type prevails in adjacent areas, there will be pressure on those Channel 3 regional licence holders who are producing to make some economies in, for example, production and studio facilities. This is not guesswork. It has already happened in Birmingham and the west midlands with Central Television, which, by and large, has moved its major production facilities to an extensive site in Nottingham, which the Independent Broadcasting Authority encouraged it to build.

Mr. Austin Mitchell

Quite rightly.

Mr. Corbett

As my hon. Friend said, that was quite right, in the context in which the company took over the franchise. There must be a risk if a company has two sets of production facilities and one is used more than the other. I do not argue with the commitment to fulfil the 25 per cent. quota for the independents, but it also has ramifications.

We have had experience, especially in the London area, of some of the television stations wanting to start to meet the 25 per cent. production quota. They talked to the independents about making programmes but used their muscle to insist that the independents use the production facilities of the commissioning company rather than their own facilities. So there are some risks.

The other point that I wish to put to the Minister is about something that already happens and which may fit with what he has in mind with economies of scale. To my knowledge, at least three television companies share a joint advertising sales force. That is happening now, before any other alterations have come about. If one company ended up owning two Channel 3 regional licences, its advertising sales force would be one area which it would immediately look at. To that extent, I can see that it makes commercial sense. Is the Minister sure that that would not run foul of competition policy? Has the point been put to the Office of Fair Trading? If not, perhaps it might be, so that everyone might know where he is going.

It is fair to say that in all our debates in the House on broadcasting during the past two or three years there has been general and cross-party agreement that democracy is at risk if too much media power is concentrated in too few hands. Indeed, we know that. In spring of 1989, 62 Conservative Members were among 87 Members of Parliament who signed an early-day motion calling for an extension of controls on ownership in the media.

In January 1989, the then Home Secretary, the right hon. Member for Witney (Mr. Hurd), seemed to anticipate that demand, when he said: We will propose extensive and effective rules to prevent concentration of broadcasting ownership and unhealthy cross-media ownership … It is crucially important that we should have such rules … Real choice would be undermined if British broadcasting were allowed to be dominated by a handful of tycoons or international conglomerates. If only the wish had been the father to the deed. But it was not, as we shall see.

In November 1989, a Gallup survey of 141 Members of Parliament found that 112 of them—roughly eight out of 10—believed that it was wrong for the same proprietor simultaneously to control newspapers and television stations; and seven out of 10 believed that safeguards should be applied irrespective of the transmission method used. Again, what a pity that those voices were not listened to when it came to the ownership proposals in the Bill, and now in the order.

Those opinions did no more than echo the claimed aspirations of the Government. In their White Paper of November 1988, right at the beginning of the process, they asserted their determination that ownership in the independent—that is, commercial—sector should remain widely spread and unhealthy concentrations of ownership and excessive cross-media ownership should be prevented. Again, those sentiments were widely accepted, although on this side of the House we question whether ownership is sufficiently widely spread now. However, this order, like the Broadcasting Act 1990, makes a small attempt to honour those ambitions.

Under the order, a company making the highest bid for, and obtaining, a regional Channel 3 licence can end up buying a second franchise after the auction round. But that is not all, as the Minister explained. A Channel 3 licence holder with a non-controlling interest in a second Channel 3 company can go on to have a 20 per cent. holding in a third such company, provided that it is not a controlling interest, and, indeed, a 5 per cent. interest in a fourth company. Again, that underlines the possible danger that a company in that position will look to see what it can do on the basis of the Minister's economies of scale to rationalise the individual facilities within those four companies. The order will not ensure that ownership in the commercial sector is, as the Government's White Paper hoped, widely spread. Nor does it properly protect against unhealthy concentrations of ownership or excessive cross-media ownership.

I believe that the Government looked at the fast changing media industry and the rapid growth of the media mammoths and decided that it was all too complicated. It is late enough as it is to introduce these orders to settle the position finally, just 21 days before the Channel 3 auction bids have to be lodged. We agree that matters of media ownership and cross ownership are complicated and that the commercial arguments for global empires which span print, video, film, television and sound recordings are at one level persuasive, especially in the cut-throat international market. But The Economist of 23 September 1989 had the answer to that. It said: The media have moved beyond being mere providers of entertainment and information. They have become a forum that rivals Parliaments. A plurality of opinion in that forum is as essential to democracy as the ballot box. That language may be a little high-flown, but the sentiments are exactly right, and ones which Opposition Members certainly share.

We have had experience, following newspaper takeovers, which should teach us that it would be quite wrong to accept the mere words of safeguards offered by either a powerful media owner or a transnational giant when it comes to the ownership of such a powerful, instant opinion-shaping medium as television, with its easy and quick access to every home in the land.

We in this House have a duty to protect and promote our liberties, not to entrust them to hands that have no other motive than the use of them to generate personal and corporate wealth and power. We need ownership and cross-ownership rules that encourage the range of voices and opinions that our democracy needs to hear and listen to. I find it slightly ironic that, just as the formerly monolithic media monopolies of eastern Europe, the Soviet Union and elsewhere are being broken up, we are headed for a concentration of ownership that few other advanced democracies would countenance.

I do not want to disappoint my hon. Friend the Member for Great Grimsby (Mr. Mitchell), but I have to say that no discussion of media ownership would be complete without a mention of those who use the non-DBS satellite, first among them British Sky Broadcasting. It was bad enough that the Government, in schedule 2 of the Broadcasting Act, provided powers to bring the non-DBS satellite services into scope of ownership provisions but then declined to use these powers. That was bad enough when there were two competing satellite services—one controlled, the other not controlled. There was then the takeover of BSB by Sky, done with the reported knowledge of the then Prime Minister, who somehow forgot to tell the then Home Secretary. That deal was stitched together within 48 hours of the Broadcasting Act's getting the Royal Assent—the most noble snook that has ever been cocked at any legislation going through this House.

As a consequence, British Sky Broadcasting now has a satellite monopoly. It is aiming for 1 million viewers, two to three years ahead, rivalling the audiences—indeed, exceeding the audiences—of most the Channel 3 stations. Yet it remains splendidly untrammelled by any of the ownership and cross-ownership restrictions that even this order provides.

There are dangers to democracy here, as The Observer reported on 23 December 1990. That newspaper claimed that Mr. Rupert Murdoch—the person who owns newspapers that sell 35 out of every 100 bought each day in Britain, and half of British Sky Broadcasting—had been refused a knighthood in the resignation honours list of the right hon. Member for Finchley (Mrs. Thatcher) by the august honours scrutiny committee.

Mr. Graham Riddick (Colne Valley)

Ah!

Mr. Corbett

The hon. Gentleman may be interested in the reason that was put forward. That was said in the context of a report that Mr. Murdoch had given funds to an extreme right-wing magazine called British Briefing, which attempted to smear my right hon. Friend the Leader of the Opposition and others at the time of the last election. Behind British Briefing was the right-wing loony David Hart, a former close aide of the former Prime Minister. That is why I say again to the Minister—and I hope that none of us will have reason to recall these words—that the medium of television, whatever the means of its delivery, is far too powerful and far too instant to be left, like those using the Astra satellite, outwith any meaningful ownership controls.

Mr. Roger Gale (Thanet, North)

I waited deliberately before intervening, as I hoped that the hon. Gentleman would qualify or justify his statement that BSkyB has a monopoly. There are 16 channels on Astra, with another 16 to come, and with a further Astra satellite planned. On the Marco Polo satellite, five channels are available but are not used. In these circumstances, how can the hon. Gentleman possibly say that BSkyB has a monopoly in satellite broadcasting?

Mr. Corbett

In reply to the hon. Gentleman I shall now say something that I would have said later. Were I an original BSB subscriber—and I believe that it launched some kind of founders' club—I should be mindful of the fact that in return for my subscription it had promised me five channels. From 15 April, BSB subscribers have had three channels. Nobody could pretend that that widens opportunity or choice.

Mr. Peter Lloyd

That does not make it a monopoly.

Mr. Corbett

It makes a monopoly in one sense. For reasons that I understand, the ITC has required BSkyB to keep broadcasting on the Marco Polo satellite. That makes sense, but its net effect, in popular terms, is that, to all intents and purposes, there is now a monopoly.

There is one consequence of the Sky takeover of BSB to which I want to draw the Minister's attention.

Mr. Austin Mitchell

My hon. Friend has said that there are dangers in monopoly, in concentration of ownership in the press and television. If that is a danger to freedom, what are the measures to deal with the problem, if they too are not a danger to freedom? How does my hon. Friend propose to end that monopoly? Does he propose to shoot down the satellites? Does he propose to prevent people from having receivers in their homes? Does he propose that public money should be provided to support competition? How is the press situation to be dealt with when some of that power comes from continuing newspapers that were failing? The classic example is The Sun. Who gave The Sun to Rupert Murdoch? There is also the example of Today. How are we to solve those problems without restricting freedom?

Mr. Corbett

I am grateful to my hon. Friend for that little GCSE question. He tempts me to go a little wider than this debate. If he is patient for a couple of minutes, his questions may be answered. I have no ambition to send Corbett storm-troopers into any studio at any time for any purpose. Of course, there is no such thing as a Corbett storm-trooper.

There is one consequence of the Sky takeover of BSB to which I should like to draw the Minister's attention. The then Independent Broadcasting Authority, BSB and Sky reached agreement on 20 December 1990 that BSB's licence to broadcast would not be revoked until a suitable alternative user of the Marco Polo satellite could be found. There is some hope that that will happen. Many of us have been fairly surprised, but there are some very exciting ideas for the use of that satellite. However, the understanding was that there would be no material change in the BSB service for another two years.

BSB's licence can be terminated as soon as June of this year, and will be terminated by the end of next year. Is the Minister in any position to require BSkyB, as the successor company, to undertake that all of the BSB equipment sold after 20 December—the date of the agreement—will be covered by a guarantee of exchange for Sky equipment when the change over is made? The Minister and the House will recall that, when that takeover happened, the immediate reaction of the new bosses of BSkyB was to give that assurance. But, unknown to many people, there was the cut-off date of 20 December.

I am told that BSkyB had earlier tried to persuade retailers to offer the BSB equipment for sale, knowing that it would not be covered by any guarantee of automatic exchange. Quite rightly, both retailers and manufacturers rejected this as being against the best interest of consumers. I wonder whether the Minister is able to persuade BSkyB to give this assurance of automatic exchange to those who want it. As I said to the hon. Member for Thanet, North (Mr. Gale), it is bad enough that, from 15 April this year, the BSkyB schedules have been changed so that all channels will be transmitted on both Marco Polo and Astra satellites. The original BSB subscribers will be robbed of three of the five channels that they thought they had bought.

Let me now reward the patience of my hon. Friend the Member for Great Grimsby. There is nothing new in what I am about to suggest as we said it throughout the passage of the Broadcasting Act. What the Government should have done—they started with the Sadler inquiry, until they turned it into a BBC-bashing exercise—was to have used the time between the publication of the White Paper in November 1988 and now to ask the Monopolies and Mergers Commission to report on media and cross-media ownership. That embraces all the points raised by my hon. Friend the Member for Great Grimsby.

As I said earlier, it is an extremely complicated subject. One could take the purist view of one man, one newspaper and one television station, but that would be rather too simplistic. That is why the advice of a body such as the Monopolies and Mergers Commission could have helped the Government and the House.

The Government did not take that chance, but the next Labour Government will consult the Monopolies and Mergers Commission and will legislate on the basis of its proposals well before the new Channel 3 regional and national licences become due for renewal. We shall insist that licences are bid for again in open competition with more stringent quality and regional programming commitments. Even before that date, we may have some proposals to protect and promote public service broadcasting to offer viewers and listeners.

Our view is that the Government are taking a needless risk with our democracy because they declined to ask for the advice of the Monopolies and Mergers Commission. The order enables a dangerous concentration of television and radio ownership to grow, although it may not quite match that of the press. That is why we shall oppose it tonight.

8.41 pm

Mr. Roger Gale (Thanet, North)

I should like to pick up a couple of points that the hon. Member for Birmingham, Erdington (Mr. Corbett) made at the start of his speech. First, he referred to the need to protect the two-centre franchises. It may gratify the hon. Gentleman to know that I agree with him entirely and share his concern. I think particularly of two such franchises. Central Television has studios in Birmingham and Nottingham and, in my own area, TV South has studios in Southampton, and built very fine studios at Maidstone as part of the honouring of its franchise undertakings when it took over from Southern Television.

It is a great sadness for those of us who live in Kent and Sussex that those studios are now lying idle. Although they produce an excellent nightly regional news and magazine service, the production capacity is largely wasted. There is real concern that, when the franchise comes up for renewal, is auctioned and perhaps taken over by an other company, or if TV South wins a renewal of its franchise, it might be economically attractive to close the studios altogether or to hive them off so that they become simply an independent production centre. Many of us who live in and represent that area feel that that would be a great shame.

I was encouraged by the emphasis that my hon. Friend the Minister put on the provisions that have been laid down by the Independent Television Commission for local production. It is extremely important that the ITC insists that those undertakings are not simply given in franchise bids but are honoured in the realisation of the franchise. I hope that my hon. Friend and the ITC will keep a watchful eye on the amount of investment in local production once franchises have been awarded. I very much hope that they will insist that production centres such as those at Nottingham and at Maidstone are maintained and developed.

My second point concerns provision for local radio, to which my hon. Friend the Minister referred fleetingly in his opening remarks. The concerns expressed about the cross-media control of local radio when we were debating the Broadcasting Bill in Committee are academic.

Since the Bill was enacted and since the award of wavelengths began, it has become apparent that there are far too few frequencies available for the comprehensive community radio service that many of us envisaged to become established, at least in the short term. The authority has advertised relatively few and will supplement them a little by the end of the year. More stations will certainly be established in the north of Engalnd than in the south.

I am reliably informed today that, in the south-east, the scarcity of frequencies is such that there will be very few community radio stations. That means that stations such as Radio Cabin in Herne Bay in my constituency, which was mentioned frequently during the passage of the Bill, and Radio Woody, immortalised during our deliberations in Standing Committee, will remain a dream in the eyes and minds of programme directors.

I therefore urge my hon. Friend to pay particular attention to the need to release the necessary frequencies as quickly as possible and to encourage those currently occupying them to move to other wavebands, so that the Radio Authority can get on and do the job that those of us who served on the Standing Committee believed that it would do and to enable the development of a genuine community radio service as widely as possible throughout the country.

I now turn tothe main thrust of my brief speech—the development of satellite broadcasting. It always saddens me when the hon. Member for Erdington finds it necessary to indulge in the regular bout of Murdoch-bashing. It has become something of a blood sport among the Opposition and no doubt we shall hear more of it before the end of the debate. The hon. Gentleman did not answer the questions put to him by the hon. Member for Great Grimsby (Mr. Mitchell) and myself.

No reasonable person could say that British Sky Broadcasting has a monopoly of satellite broadcasting in the European skies. The Astra satellite carries a number of channels and more will follow. During the passage of the Broadcasting Bill, I mentioned the fact that the Hughes Corporation of America has plans to launch in 1993 a digitally transmitting satellite carrying 104 televison channels. That will horrify many people, but it is planned.

In that context, it is not realistic to say that Mr. Murdoch and his channel have a monopoly. Sky Television blazed a trail that would otherwise have been followed probably by Ted Turner and his company. Given the choice, I believe that the satellite viewer in the United Kingdom would prefer the offerings of Sky Television—a largely British company— to those broadcast by Ted Turner or any other American company. Sky Television, in its merger with BSB, has not killed off three channels of Marco Polo transmission, as the hon. Gentleman suggested, but has rescued two which otherwise would have gone into the bin. There was no question of both those companies surviving. The merger was no part of a plot to jump on the back of the Broadcasting Act 1990 immediately it became law.

About two years ago in this Chamber on a Friday morning, we had a brief debate on the future of broadcasting. I had the temerity to suggest that, unless those two companies got together, neither would survive. It gives me no pleasure to say that that is exactly what has happened. The choice, as in so many cases, was not between maintaining both channels or allowing one to take over the other. Those companies had to merge, or both would have gone under. If that had happened, we would have had no satellite television service on offer to the United Kingdom viewers. No satellite service would have been provided for the investors in squarials and the receiving equipment already referred to today. The failure of those companies would have meant that we had no satellite service to compete with those services already offered by our continental competitors and American companies.

I find it sad that, in this Chamber and in Europe, we continually debate the control of television, when we should be debating the future development of television and satellite services.

The development of digital transmission was debated in Committee on the Broadcasting Bill. The European Community has spent a great amount of time and wasted effort on pursuing high definition television with a MAC—multiplexed analogue components—transmission system. That system is already virtually obsolete; as obsolete as the Marco Polo satellite which relies upon that transmission system.

It is an absolute certainty—recent demonstrations in America have proved this—that digital satellite and terrestrial transmission will be with us by about 1993. That is the television of the future. However, the Opposition are seeking to stultify that development by continually seeking to control.

What those behind Sky Television, and now BSB, have done is to take a major step forward. Those same people have invested and lost vast sums of money on satellite technology, but they are still prepared to look one stage ahead. People in this country and in Europe should be prepared to take that step. In Europe, those who have invested heavily, with large pots of socialist money, in high definition television should be prepared to cut loose from that and invest in the development of digital picture transmission.

Unless that happens, the United Kingdom and the rest of Europe will be left out in the cold as the Americans, who have already developed this technology, take the lead. That is the choice we face. That is why I believe that, for all its many faults, the role that Sky Broadcasting, and now BSB, are playing in the development of television towards the 21st century is so important.

I ask my hon. Friend the Minister to consider the order carefully, and to consider one important fact. Under the order, BSB must divest itself of its broadcasting capacity on the Marco Polo satellite. Unless the House of Commons is mug enough to use that archaic form of technology to transmit the proceedings of the House to those non-existent people who will be able to watch it, the Marco Polo satellite will be a dustbin floating around the sky.

If BSB is not allowed to continue to use Marco Polo because of tonight's order, that company, which has already invested huge sums of money in the development of satellite in the United Kingdom, will have to give to every owner of a squarial a receiver capable of receiving the Astra signal. That would be a complete waste of money, money that would be much better spent investing in the development of the technology of the 21st century. I urge my hon. Friend to reconsider the order.

8.54 pm

Mr. Robert Maclennan (Caithness and Sutherland)

I suppose that many people would share the enthusiasm of the hon. Member for Thanet, North (Mr. Gale) for the development of satellite television, which will widen consumer choice. I am not sure, however, that many would agree with the hon. Gentleman that those who took the decision to buy a squarial should have been the victims of the collapse of BSB two days after the enactment of the Broadcasting Act 1990. Although I share the view that it is not quite precise to describe BSkyB as a monopolistic entity, it has been exercising its market power in a rather unattractive way with respect to its obligations—moral, if not legal—towards those who had already acquired a squarial.

I should like the Minister to answer the points raised by the hon. Member for Birmingham, Erdington (Mr. Corbett) who alleged that the company invited retailers to put BSB equipment back on the market so as to avoid having to pay compensation. That is quite a serious charge and it merits a response from the Minister. The Minister may say that he has no control over the situation, but that only demonstrates some of the weaknesses of the regulatory framework in protecting the consumer interest—a Government responsibility.

Mr. Peter Lloyd

I can give the hon. Gentleman some reassurance. As I understand it, the ITC has agreed with BSkyB that it will replace the squarials that were functioning before the merger took place at no cost to the customers.

The hon. Gentleman is right to say that Ministers do not have the power to require any business to compensate its customers in any particular way. It may have a moral obligation towards its customers, in which case that is a matter for the company. It may have a legal obligation, and that is a matter for the law. The hon. Gentleman will understand, however, that in this case, as with any other commercial undertaking, it is not a matter on which Ministers can rule. I hope that the hon. Gentleman will be somewhat reassured, however, by the agreement that has been reached for BSB customers.

Mr. Maclennan

I agree, but I think that that point was fairly widely known. The hon. Member for Erdington was making a new point, which was that BSB had apparently attempted to encourage retailers to continue marketing equipment for which the consumer would have no necessity, in order to avoid its undertaking to replace equipment acquired at an earlier date.

I accept that Ministers have limited power, but if they look with a drooping and inauspicious eye on what important men of commerce do, the men of commerce will notice that. It is not a matter of leverage; it is just a matter of disapproval. If the allegations made by the hon. Member for Erdington are true, they are pretty disreputable.

Mr. Lloyd

Perhaps I can say sufficient to enable the hon. Gentleman to move on to another point, even if it is not to his complete satisfaction. I listened to what the hon. Member for Birmingham, Erdington (Mr. Corbett) said and I took due note of it. It is not a matter of which I have knowledge, but it is something with which I intend to acquaint myself. From the way he put it, it is certainly not a matter for me, whether I would like it to be or not.

I was interested to hear the hon. Member for Caithness and Sutherland (Mr. Maclennan) say that the old squarials are no use and that anybody who is foolish enough to buy one would be making a huge mistake. I hope that that will not be the case. If the hon. Gentleman had any of the optimism of my hon. Friend the Member for Thanet, North (Mr. Gale) and looked ahead to the further development of satellite television, he might make a good bargain with what now looks like redundant equipment. It is for him as a customer to make his own judgment and to make up his mind.

Mr. Maclennan

I have made the point. The Minister may be wise to encourage me to move on to another point, so I shall do so.

The background against which the order is being debated is not quite the same commercial background as that which greeted the Broadcasting Bill in its infancy. It is fair to say that we are now in a more competitive situation than we were at that time. Advertising revenue is substantially reduced and those companies which are contemplating bidding for the franchises for Channel 3 are doing so in a cold climate. That makes the cross-ownership provisions that we are considering tonight perhaps more significant. There may be those who are less enthusiastic about bidding than they were. I do not know whether the hon. Member for Erdington is right in speculating about negative bidding—I hope not—but undoubtedly it is a cold climate.

That moves me to ask the Minister about the outcome of the representations that were made to him and other Ministers on 8 April at a meeting with representatives of the Independent Television Association led, I believe, by Sir Brian Bailey, about the severity of the impact of the levy on the revenue of the company. It would be reasonable for the Government to make clear their conclusions on that point before the date of bidding. I hope that the Minister will take the opportunity of this debate tonight to give some idea of the Government's thinking on that point. I understand that there have been discussions between his Department and the Treasury about it.

I come now not just to the circumstances but to the terms of the order. It may be appropriate to begin by saying that I acknowledge, and with some satisfaction, the fact that the Home Secretary did in part reverse his position as a result of pressure put upon him not only by me but by a number of other hon. Members and companies in respect of the contiguity principle.

It must be said that, when the Bill was enacted last year, it was without any expectation that its provisions, and the assurances that had been given during its passage through the House, would be so radically changed as they were by the present Home Secretary, almost as the first act of taking office in November.

Those who participated in the protracted debates know that the importance of regional television dominated our discussions of Channel 3—who was to acquire the licences and what standards would be required of bidders. It was with those concerns in mind that the Chief Secretary to the Treasury, who was then the Minister responsible for the Broadcasting Bill, gave a clear undertaking to the House that the contiguity rule—not a very elegant description, but it is clear—would be maintained. It was intended to prevent a process of consolidation in regional television production which would lead to the disappearance of the characteristic qualities of the 15 regions.

The hon. Member for Thanet, North spoke about the problems of TVS and told us what was happening to the studios in Maidstone and Southampton—and in Nottingham too, with Central. Hon. Members of all parties were anxious that such pressures should be held at bay. We were all eager to maintain the regional basis of television, especially with Channel 3—that was really the sole justification for its separate existence. I am glad that the Minister found it possible at least to reach this compromise. It is an important step in the right direction and will give the companies in the bidding process the opportunity to establish themselves. It will prevent. them from being tested by hostile predatory bids before the end of the moratorium provided for under section 21 of the Broadcasting Act.

It is likely that many of the companies, probably most of them, will put this period to good use by fortifying themselves against unwanted attention from predatory neighbours. However, it would have been wiser to have stuck to the Government's original position. It is hard to believe that that could not have been done by way of an amendable order. Then, if the feared adverse circumstances arose, and some of the farthings in the penny-farthing relationships got wobbly and might not be salvageable, the orders could be amended. I assume that this order could be withdrawn and a new order introduced if it were found unsuitable or inadequate, so I shall not press my point too hard, but it would have been sensible to have removed the uncertainties that the threat of acquisition by a hostile neighbour will still pose after 1993.

The provisions concerning the sharing out of companies do not depart fundamentally from the measures that we debated at considerable length during the passage of the Broadcasting Bill. My right hon. and hon. Friends and I expressed at the time our fears about the concentration of ownership. We said that we wanted diversity and plurality of ownership, and that the present arrangements allow too great a concentration of power. We would have welcomed a report from John Sadler or the Monopolies and Mergers Commission, for example.

I do not go along with the Opposition's Front Bench spokesman, the hon. Member for Erdington, in believing that it would be sensible, following a general election, to set in train yet again the entire bidding process. That would run counter to the interests of television. We must be mindful of the upheaval that the companies face and the concentration of effort that goes into preparing the bids. It is an irresponsible undertaking of the Labour party to suggest that it would relaunch the process if, by some chance, it were to form the next Government.

Mr. Corbett

There has been some misunderstanding. I did not say what the hon. Gentleman suggests. I said—this is what I meant to say or what I thought I said—that at the end of the licence period, on which we are just about starting, we would go through a bidding process again, and not as envisaged under the Act. The only things that would come under the Act would be via the stock exchange. That is all I said.

Mr. Maclennan

I am grateful for that clarification. If I misunderstood the hon. Gentleman's proposal, I readily withdraw. I am bound to say that I thought that he was talking—I think that others reached this understanding—about relaunching the bidding process on the basis of new ground rules as soon as he became the responsible Minister. That would clearly be adverse to the interests of television.

If the arrangements for television cannot be entirely welcomed, the arrangements for radio seem to be considerably worse. It is clear that radio is operating within tight commercial constraints, with limited prospects of profits. The competition that we are witnessing makes the probability of concentration much greater for radio than for television. It is all too likely that the proposal that one company should be allowed to own up to 20 local stations, so that costs and programming will be shared, will be the pattern. I fear that we shall see the disappearance of the diversity of stations that has been held out to us, tantalisingly, as the object. It is not possible within the scope of the debate to deal with possible remedies for that. I merely note what is proposed in modification of the general principle in applying a point system for independent radio.

I fear that the result of the proposals will be the loss of local services. Most stations will be bland and will offer the barest minimum of local news and stories. As soon as a station starts to attract listeners, one of the giants of local radio will seek to take it over.

That is a pattern that we watched with dismay in France. I guess that we cannot prevent it occurring in the United Kingdom, but it is a reason for taking the view that the order is inappropriate to deal with the problem.

It is deplorable and regrettable that community radio is likely to be the first in line for the chop. In the current climate, it is virtually impossible to set up new and specialised services that will attract advertising while audiences are accumulated. Again, if community radio breaks through, it is likely to be quickly swallowed up by one of its larger commercial rivals. We should have built-in protections for community radio, whose function is quite different from that of local radio.

On previous occasions, I have said that the 20 per cent. limit was inappropriately large for television and radio stations, and that a smaller limit would be wiser in a pluralist society. We have missed an opportunity to make competition more effective by holding the reins in a different way. I am disappointed that thinking on that matter has not developed with the advent of the new Home Secretary.

The issue of non-satellite broadcasting divided the House on a previous occasion. Only domestic satellites are mentioned in the order. Now that Mr. Murdoch has reduced his holding in BSkyB, perhaps the personal reasons for exempting him from the rule of law have disappeared. It might be appropriate to go back to the drawing board and consider introducing legislation consistent with that for other sectors, and so remove the special favours for non-domestic satellites that have shown the lack of power of the Independent Television Commission to protect consumers' interests within hours of the enactment of the Broadcasting Bill. I do not expect the Government to move instantly on that matter, but I should like them at least to think about it. It would make sense in the longer term and it would be in the consumer interest.

The order does not reflect the sort of priorities that we believe should have been protected, and for that reason we shall not support the Government tonight.

9.6 pm

Mr. John Greenway (Ryedale)

I declare an interest as an adviser to Yorkshire Television.

Our debates on the Broadcasting Bill over the past 18 months have been characterised by the shedding of more light on what the future broadcasting scene is likely to be. There was a good example of that a moment ago in the exchange of views between the hon. Members for Birmingham, Erdington (Mr. Corbett) and for Caithness and Sutherland (Mr. Maclennan). There will be rejoicing throughout independent television, not least in the Independent Television Commission, that the hon. Member for Erdington has at least clarified his party's position on the allocation of licences—that in the unlikely event of a Labour victory at the next general election there will not be a wholesale reallocation of licences. That is of some relief to us.

I have some sympathy with what the hon. Member for Erdington said about the risks facing Channel 3, and especially regional television. The hon. Member for Great Grimsby (Mr. Mitchell) put his finger on the root of the problem when he referred to the position of newspapers. Certain national daily newspapers have survived only because of the entrepreneurial investment of certain so-called media tycoons. Whether it is commercial television, commercial radio or newspapers, there is no guarantee of commercial success.

Throughout our deliberations on trying to set in place a proper framework for the future of Channel 3, the real difficulty was that we needed a structure that dealt with the most profitable regions such as Thames Television, TVS and London Weekend Television, but also provided a sensible framework for the future of Grampian Television and Border Television in Scotland. That was at the heart of concern over the future of the ownership of Channel 3 licences and explains why we were unable fully to resolve those matters in Committee, on Report or even on Third Reading of the Broadcasting Bill. Therefore, there was a need for further reflection and consultation on the best framework.

I hope not to appear modest when I suggest that the order, in relation to Channel 3, broadly reflects the compromise proposal that I put to my right hon. Friend the Home Secretary shortly before Christmas. I remain disappointed that there was no agreement between the two adjoining licensees to allow mergers to take place even before the licences are reallocated—but that is history.

Now the bids are about to be submitted. By the end of the year the licences will be allocated. In terms of future mergers or takeovers, the draft order provides a sensible compromise between the conflicting and competing commercial interests of different television stations and the crucial ingredient of protecting the regional commitment of whoever has that licence. That involves protecting not the commercial interests of a specific television station, but the regional arrangements and the regional map of Channel 3—there is a fundamental difference between those two.

Mr. Maclennan

indicated assent.

Mr. Greenway

The hon. Member for Caithness and Sutherland nods in agreement because he knows that those matters largely affect his constituents. I am glad that he agrees with me on that.

I take the point of the hon. Member for Erdington that the framework provided by the Bill leaves us with much meat to put on the bones. However, my reading of the Channel 3 licence applications suggests—I think that this is accepted throughout independent television—that those who will be granted licences in the allocation, whether existing Channel 3 licensees or new players, will have a stronger regional commitment to Channel 3 as a consequence of the Bill and the order than was the case under the old arrangement. That is largely to the credit of my right hon. and learned Friend the Chief Secretary to the Treasury, who was responsible for guiding much of the legislation through the House. He responded well to our concerns in the regions about the future of regional television.

We cannot emphasise too much the fact that Channel 3 will represent regional television in the future. I have grave doubts about whether it will be possible, in the greater competitive world of television in the next century, for the British Broadcasting Corporation to maintain the sort of regional television and local radio service that it has at present. I am not suggesting that it will not fight hard to maintain those services, but Channel 3 is the one television channel required, by statute, to provide a regional service. That is why it is important that we place in perspective the issue of who should in future own some of the smaller licences should the cold competitive world of the future mean that their viability is threatened. That is where I part company with the hon. Member for Caithness and Sutherland. I cannot and never could see the logic of the distanced penny-farthing. I cannot see why Central Television should want to bail out Border Television should Border Television get into financial difficulties.

I can see a considerable advantage, however, in suggesting that Granada Television may wish to bail out Border Television. The hon. Member for Erdington says that that threatens to undermine the regional service. It does not, because it is clear from the legislation arid what has been said about Channel 3 licence ownership that any company that takes over a neighbouring licence, or any other licence, would be required to honour all the licence obligations, including regional commitments. Those must include the arrangements which the Bill requires and which the Independent Television Commission has strengthened in its draft licences, for the licensees to demonstrate how they will meet the regional programme.

Economies of scale can be beneficial, but there can also be commercial benefits and benefits to viewers. The whole of my constituency in north Yorkshire is one of the overlap areas. Neither Yorkshire Television nor Tyne Tees Television has universal coverage. As we all know from past arguments, that is because of transmission arrangements. However, where a larger licensee acquires the interests of a smaller neighbouring licensee, there can be considerable advantage for viewers in the strengthening of local and regional services. That must not be underestimated.

It will be clear from my comments that I strongly support the order. I shall not mention all the matters with which it deals but will continue to confine my remarks to Channel 3 licensees. In that context, will my hon. Friend the Minister consider the fact that everyone's attention is currently focused on the bid for Channel 3 licences? It is an historic moment for the future of independent television. Contrary to what the hon. Member for Erdington said, we are about to allocate the licences for a period of some 20 years and set the framework for the future of our main terrestrial commercial television channel.

That is why we were right to spend so much time trying to get that framework right. In Committee and on the Floor of the House we argued about the need to maintain quality while not inhibiting commercial opportunity. I believe that we have got the framework right, but it rests on the exceptional circumstance arrangement in the scheme of bidding. None of us wants the highest bid to win at the expense of quality. Will my hon. Friend confirm that the exceptional circumstances provision is there to be used? The hon. Member for Caithness and Sutherland, whose constituency is as far as anyone else's from London, will agree that the further one is from London, the more important is the regional concept of Channel 3 television. The provision deals with the quality of Channel 3 and its commitment to the regions. I believe that the regional commitment can be considered an exceptional circumstance in the scheme of bidding.

On local radio, the ownership arrangements in the order are complex. I hope that my hon. Friend can confirm that he does not accept any argument that those ownership arrangements would hamper commercial investment in local radio because local radio will not be involved in big megabucks, money-spinning activity. Many people will have to put much effort into providing independent radio competition locally against the BBC structure. In rural areas there will not be large audiences and some people many well be investing almost on a wing and a prayer. We should not discourage that investment by ownership rules which are too complex.

9.30 pm

Mr. Austin Mitchell (Great Grimsby)

I declare an interest, in that I present a programme for BSkyB. It is an excellent, high-quality programme of great intellectual rigour in which I speak for freedom, truth and justice and the right hon. Member for Chingford (Mr. Tebbit) dissents, when he can get a word in. That ends the commercial break.

The order closes the stable doors after the horses have bolted all over the place. There is an incantation of magical formula of 5 per cent. of this and 20 per cent. of that being introduced, long after the brew has curdled and all the decisions have been taken. The Radio Authority and the ITC are both trying to catch up and cast a cloak of rationality over the undesirable situation that has developed in television and radio. They have been cogitating for months and now we have their recommendations.

During that time—indeed, over the past couple of years—the whole position in radio and television has changed, in my view for the worse, as a result of commercial decisions. In order to accumulate war chests, the ITV companies have drastically reduced staff levels, and therefore their ability to produce high-quality programmes for their regions. As I argued in an intervention in the Minister's speech, the strength of ITV is that it took television production out of London and established centres of excellence in all the regions—in Manchester, in Leeds and in Tyne Tees, for example. The position of those centres has been undermined, and they are now threatened by the contract allocations.

We want to maintain those centres. As far as I can see, there is no requirement in the regulations that the centres of excellence or the network of skills be maintained. The companies can simply become publishers, farming out programmes to independent companies as long as those independent companies produce in the regions. In a sense, that is wishful thinking in areas like Tyne Tees or Yorkshire, where there is not a vigorous network of independent companies to carry on the responsibility if it is not fulfilled by a strong production centre in Newcastle or in Leeds. Therefore, I see a real threat.

I also see a farcical position developing because of the ludicrous system of bidding. If a regional company is not challenged and simply puts in a bid of a penny or a ha'penny, what will happen? If the Government's greedy aspirations cannot be fulfilled because there is not a challenge, what control will the Government or the ITC have? I should like to know, because my hon. Friend the Member for Birmingham, Erdington (Mr. Corbett) and I will almost certainly be putting in applications for licences.

Mr. Peter Lloyd

So long as the applications pass the quality threshold in the circumstances that he describes, the hon. Gentlemen will get a good bargain.

Mr. Mitchell

They say that they are a Government of business and commercial rigour, but they have created a daft situation like that. A company that makes an excellent contribution to a region, has a good reputation is not challenged, because of the strength of its productions and what it has done for the region, can get away with making a bid of one penny. The Minister has told us that that is the case. If that is the eventuality, it is daft.

Mr. Lloyd

If a company wanted to bid in that way, it would get a good bargain, but I do not believe that it would win if it bid only one penny.

Mr. Mitchell

In some areas, it is difficult to get bids because expectations are low and the commercial reality is difficult. Money is tight at the moment. In that situation, if a competing bid is not put together, the company would get a bargain. It is folly on the part of the Government to provide them with that opportunity. However, I shall not grumble. If it puts more money back into television production, it benefits viewers in that region, it benefits television and therefore I welcome it.

The second major deterioration that has taken place in the intervening period is in radio. I am saddened by what has happened in commercial, independent, local radio. Companies are gobbling each other up. They are forming bigger and bigger blocks, providing more and more programmes on a network basis, not for a locality or a community, but for an amorphous, much wider entity. Concentrations of shareholdings are taking over companies.

That saddens me because, in 1975, I was involved in the foundation of Pennine Radio in Bradford, which started out as Bradford community radio. We fulfilled to the letter the IBA's then intentions, which were that there should be locally based radio stations, serving the community, with local shareholders, and with local figures taking an active part, providing a vigorous local news service and a talk opportunity for people in the locality. That is all going by the board.

The regulatory authority has watched over the undermining of every one of the principles under which it insisted that people should bid in the first stage in the 1970s, when those stations were set up. The authority has seen the principles undermined, frustrated and overturned and has witnessed the creation of commercial blocks which are nothing more than juke boxes established in a series of localities, over a wider region. That frustrates the purpose of local radio, which is what it is all about, and we have watched it happen.

These regulations are closing the stable door on that process. Indeed, they are closing the stable door in an incomprehensible fashion. I see that section 12 of the regulations entitled "limits", states: Subject to the following paragraphs, a person shall not at any time hold licences to provide national, local or restricted radio services such that the total number of points applicable to such services, calculated in accordance with article 11, exceeds 15 per cent. of the total number of points so calculated applicable to all such services in respect of which licences have been granted and have not ceased to have effect. What does that mean? How is that an effective base on which to provide a genuine local radio service of the type that I and the people at Pennine Radio were so proud to establish in 1975, when—we struggled to fulfil the requirements that were then imposed by the IBA—we set up a local radio station serving a genuine community which was run by people from that community and had a shareholding in the community.

The matter has become a joke, and it is not helped by a regulatory authority which we were told would be a light touch authority—in radio as in television—but which is now going in for more heavy-handed regulation than anything that preceded it.

I have had a long brush with that authority over their regulations, which state that politicians shall not present their current affairs programmes. It seems to be all right for politicians to preside over radio authorities, but not for them to appear on a radio programme that it is nominally supervising.

One expects a bureaucracy to justify its silly or irrational decisions. It is a civil servant's job to put "Not unwelcome" on the doormat and to phrase things to defend the status quo. However, in my correspondence about that decision, which seems to me to be an unnecessary interference with the freedom of radio stations, the authority has not even understood the point at issue. The intellectual level of the replies is very worrying. If that is the regulator, it is now in an impossible position because of the differentiations in the national radio stations that we are now setting up. If it is true that the authority has received no applications for the first national non-pop radio station and has had to extend the date for applications in the desperate hope of receiving some, how will that body be regulated if the authority has to beg for applicants to fulfil the intentions that the Government have foisted on it? How will it be regulated if the Government are desperate for bids?

Mr. Corbett

Shall we spend another penny on a radio station?

Mr. Mitchell

I am always happy to co-operate with my hon. Friend the Member for Erdington. Let us extend our talents not only to television but to radio stations.

The Radio Authority's intervention in LBC is another classic example. LBC spent a small fortune splitting its frequencies and providing two radio stations. Then, along comes the Radio Authority, which is committed to diversity, to ask it to put them back together again. That is heavy-handed and elephantine regulation, when we were told that the touch would be light. Frankly, the intellectual level is depressing.

We are dealing with regulations that try to freeze a mess, especially in local radio, where the only effective competition now comes from BBC local radio, which provides diversity and an alternative service. I am thinking especially of BBC Radio Humberside. It provides a magnificent service in the area where allocations by the BBC have been cut because it is kept on such a tight financial string. Local radio is therefore less able to serve its community, so competition is being undermined. The intentions of the system are being frustrated and will not be upheld by the regulations.

The third change is the collapse of British Satellite Broadcasting, which was the biggest disaster after the poll tax. That was a tragedy and a folly, because we had an opportunity to get into the satellite market early with a high technical capability, which would have established us as leaders and provided a system that could have been expanded and sold in Europe. The Government's indecision, dithering and inability to decide who should run it meant that the launch was put back again and again. They considered different companies and danced a series of marital gavottes with different partners, all of which broke up.

Engineers imposed standards that were technically too high and therefore, more expensive, thus reducing again the range of choice of those who could provide the service. The Government delayed and British capital, which is conventionally nervous in such a situation, was very slow, so the service came too late. It was launched years after it should have been launched, whereas it was vital to get into the market early. It lagged behind and staggered. It went in, even then, with expectations that were too grandiose and with a structure based on the BBC and run by people from the BBC who were used to overspending and to grandiose expectations. It was like the hon. Member for Rochdale (Sir C. Smith) hang-gliding. It was overstaffed, top-heavy and bound to crash because it paid no attention to commercial realities.

BSB failed for two reasons. First, it spent too much money and was too grandiose. It had no idea about commercial realities. Secondly, Rupert Murdoch got in first and scooped the market. Who can blame him? Capitalism is all about taking a risk. Rupert Murdoch got in and did it—successfully. In those circumstances, BSB was bound to fail. It is silly to start complaining—as my hon. Friend the Member for Erdington did—as if Sky had taken over and strangled its opposition. That was not what happened. The shareholders of BSB, alarmed at the scale of their losses, took the baby out of the management's hands and dumped it on Rupert Murdoch's doorstep. That is literally what happened.

How can we then—as my hon. Friend the Member for Erdington did—blame what happened on the man on whose doorstep the baby was dumped? He had taken the risk. About £1.5 billion has been spent so far on the satellite venture. That was enormous expenditure, to provide more choice and diversity for viewers in Britain. So why are we going in for this chorus of blame, praising with faint damns? We assent with civil leer, And, without sneering, teach the rest to sneer. That is our attitude.

I should have preferred a fight—a conflict in which the viewers could have chosen. I should have preferred competition to provide better programmes. That is not what happened, but it is not realistic to blame Murdoch for a situation that was not of his making. The merger was cleared by the Office of Fair Trading, so it is churlish to carp. I do not come to praise Rupert Murdoch but I do not come to bury him either.

The order is a fig leaf to conceal the Government's impotence in the Sky-BSB merger. Our position is intellectually disreputable. However desirable it might be, it is not possible to prevent concentrations of ownership in the media unless the freedom of the press is restricted and the Government close off people's opportunity to enter the market and require people to get out of the market. That is the problem. It is a problem which we must solve if we are to say that the market must be regulated. If we cannot do so, we should not imply that we would deal with the matter.

I have never particularly liked The Sun, but I do not read The Sun. In the heart of every Labour Member of Parliament there is a C. P. Scott struggling to get out. The ethics of The Sun are a matter of taste, but that is not a justification for legislative intervention to expropriate newspapers. The Sun was handed to Rupert Murdoch by whom? We must take that into account. He saved it from closure. The same applies to Today. It is unrealistic to say that we will deal with the monopoly by taking papers away and allowing them to fail. That would be irrational.

My hon. Friend the Member for Erdington said that we would refer newspaper ownership to the Monopolies and Mergers Commission for investigation. That is the classic formula for any party that cannot decide what to do. It passes the matter on to a Royal Commission, to take minutes and waste years, or to the MMC. However, if we say that, it is irrational also to say that the 20 per cent. ceiling on, for example, Rupert Murdoch's participation would be enforced at the same time, even before the investigation was complete. What is magical about 20 per cent.?

We have here a system that provides more choice and allows the viewer to choose. That is important. More diversity has been provided. Murdoch has taken a risk and I hope that he will succeed. It is churlish to carp and drag sulkily behind saying, "Naughty, naughty." That is not intellectually credible. In focusing on that issue, we have lost sight of the real issue, which is the undermining of the local roots of production in both radio and television. We are fiddling while the position deteriorates.

I am terribly worried that the failure of the Government to provide in the legislation for local production in centres of excellence, which are the basis of ITV's federal system, will mean that the people bidding for contracts do not establish production centres but farm production out. They will farm that out and become publishers. It may be that they will farm it out to independents in the regions, but those people will not encourage the skills, or establish the centres of training and excellence, in the way that ITV has.

I am particularly worried about the maintenance of centres at Border, Grampian and Tyne Tees, where they are important, and about the erosion of local bases in commercial local radio. Local television and radio have been the pride of our system. We are sabotaging the local basis of electronic communications, and this order will do nothing to stop that process.

9.50 pm

Mr. Graham Riddick (Colne Valley)

There is a perfectly respectable case for saying that we should have none of these regulations or controls, but leave it to the Monopolies and Mergers Commission to step in if competition is being stifled or undermined. However, I accept that, on balance, it is probably right that we should support this order to ensure that, from the word go, no such reduction in competition takes place. I see no justification whatsoever in the cross-media ownership controls relating to newspapers and satellites. They are wholly unnecessary.

I am a little surprised that the Labour party should be making a fuss about Rupert Murdoch's ownership of a satellite television station. I am surprised to see them engaging in another round of Murdoch-bashing. The last time we discussed this issue—during the debate on the Broadcasting Act 1990—the Labour party clearly lost the argument. The speech of the hon. Member for Birmingham, Erdington (Mr. Corbett), in which I think he was arguing that a Labour Government would force Mr. Murdoch to divest himself of either his satellite interests or his newspaper interests, was, to say the least, extremely unconvincing. I was astonished when the hon. Member for Caithness and Sutherland (Mr. Maclennan) appeared to suggest that he had some sympathy with the case being made by Labour Front-Bench Members.

The hon. Member for Great Grimsby (Mr. Mitchell) used the word "disreputable" to describe the approach of his hon. Friend the Member for Birmingham, Erdington (Mr. Corbett). I shall be a little more rude, although it is not always easy to be less polite than the hon. Member for Great Grimsby. Clearly, there is one source of motivation for everything that Labour Members say about Rupert Murdoch and his interests. That motivation is spite—sheer spite. It was Rubert Murdoch who destroyed the stranglehold that the print unions—some of Labour's paymasters—had over the newspaper industry, and Labour wants to get even. It was Rupert Murdoch who got rid of the restrictive practices in newspapers, which were doing so much damage to the industry. A political party whose policy is based on spite does not deserve to be taken seriously.

I am no longer surprised that the right hon. Member for Birmingham, Sparkbrook (Mr. Hattersley), the shadow Home Secretary, for whom the hon. Member for Erdington has been acting as mouthpiece in this debate, should behave on the basis of spite. Last year, he said that he would never again write for the Murdoch newspapers. That was a spiteful decision, but one which, as a regular reader of The Times, and the Sunday Times, and, I confess, as an occasional reader of The Sun, I welcome entirely.

Applying Labour's approach could be justified only if there were a monopoly. The hon. Member for Erdington tried this evening to argue that there was, but the truth is that there is no monopoly. Mr. Murdoch's newspapers operate in a highly competitive environment, a highly competitive marketplace. Each has robust competition, and nobody forces anybody to read any of them.

It is quite clear that Mr. Murdoch's satellite investment is highly risky. Nobody forces people to watch those satellite television stations. The suggestion that Rupert Murdoch has a satellite monopoly is complete nonsense. Mr. Murdoch now owns only 40 per cent. of British Sky Broadcasting and, as my hon. Friend the Member for Thanet, North (Mr. Gale) pointed out, there is great choice on the Astra satellite system. There are already five English language channels on Astra. More importantly, British Sky Broadcasting is providing competition for the duopoly that has existed in Britain for so long in the BBC and ITV companies.

The real power in broadcasting is not Mr. Murdoch but the BBC. Measured by revenue, the BBC is the largest media enterprise in Europe. It enjoys monopoly access to the licence fee; it has half the terrestrial broadcasting spectrum at its disposal; it has the lion's share of the radio frequencies; it employs 27,000 people and it is the second largest publisher of consumer magazines in Britain; yet Labour does not advocate dismantling the BBC. Apparently, Labour likes the BBC. I am not suggesting at this stage that we should dismantle the BBC.

Mr. Geoffrey Dickens (Littleborough and Saddleworth)

Does my hon. Friend agree that the Opposition want to dismantle the Broadcasting Standards Council? They complain about the amount of sex and violence that appears on television, yet at the same time they want to abolish the very body that sets and controls those standards. It does not line up.

Mr. Riddick

My hon. Friend is right. The Labour party is very partial in its approach to these matters. As my hon. Friend has pointed out, the Labour party wishes to abolish the Broadcasting Standards Council. It would also reverse the impartiality clauses contained in the Broadcasting Act, which I hope will ensure greater impartiality in broadcasting in the months and years to come.

Tonight we have seen an exercise in Labour hypocricy. The Opposition do not like Mr. Murdoch, and what they have been saying about him tonight is motivated purely by spite. The hon. Member for Erdington, who is no longer in his place, should be thoroughly ashamed of himself for that.

9.57 pm

Mr. Norman Tebbit (Chingford)

I regret that I missed the opening Front Bench speeches in the short debate this evening. That was not because, as a television viewer, I detest repeats and it was quite clear that the Labour party would wheel out a repeat of an old show that had failed to improve its audience ratings before, but because the business came on a little earlier than we had expected.

I should remind the House of my personal interest in these matters as a working television journalist employed by British Sky Broadcasting, and of course as the co-presenter of a programme with the hon. Member for Great Grimsby (Mr. Mitchell). It is most agreeable to have got through three sentences in his presence without having been interrupted. As those who watch our programme will know, that is extremely rare—as rare as my letting him have his say without interrupting him.

I share the concerns which have been expressed this evening about the possible growth of monopoly or dominance within the media, but I see it at a slightly different angle for some Opposition Members. The order does not relate to the printed media—the newspapers—although there is a clear connection because of the provisions relating to ownership. But for the activities of Mr. Murdoch and his company, aided and abetted by Mr. Maxwell—a former Labour Member of Parliament who is rumoured to be a Labour supporter to this day, and who has been almost as forthright in breaking the monopoly power of the trade unions in the print business—I very much doubt that we would see The Independent or several other titles today. It is possible that The Guardian would have gone under—a tragedy that I would have borne nobly and stoically, without too many tears, I must confess. None the less, one should provide a wide range of choice even for those who are obviously fundamentally unable to take advantage of it.

Any suggestion that the activities of Mr. Murdoch in this country have been monopolistic are misplaced. I find it particularly odd that there should be a suggestion that there is any form of satellite television monopoly. There are plenty of channels available at the moment on satellite that could broadcast into this country. It is up to those bold enough to come forward.

If the hon. Member for Birmingham, Erdington (Mr. Corbett) could raise a couple more pennies— like him, I am, at times, overwhelmingly tempted to spend a penny on some of our broadcasters, to use his phrase—and some cash, he could have a channel on one of the satellites. Whether or not anyone would want to watch it is another matter.

Mr. Corbett

Rather like Sky.

Mr. Tebbit

Well, I am not sure that the hon. Gentleman would normally find a million or so viewers. I suspect that, if it came to it, his hon. Friend the Member for Great Grimsby would have a lot more viewers than the hon. Gentleman. We might have a few more viewers for this debate if the two of them transposed their positions. As we all know, however, the hon. Member for Great Grimsby was sacked from his Front Bench position, for taking a job with British Sky Broadcasting. That was done, I presume, so that we should not have any censorship in the media. It does not matter if one writes for The Times. That is not an offence—well, not if one is senior enough; it is only if one is a junior, and when one works for Sky, that one gets fired from the Opposition Front Bench. The gainers from that encounter were ray hon. Friend—I mean the hon. Gentleman; I must remember the proprieties of these things—the Member for Great Grimsby, my co-presenter, and the viewers of Sky.

By far the most dominant force in television today is not Mr. Murdoch, but the BBC. That poses the danger of a monopoly. It still has half the terrestrial channels, apart from its publishing activities. My hon. Friend the Minister should keep a close eye on how well the BBC is doing in the process that was set in train by my hon. Friend and others of contracting out more of its programmes to independent producers.

If my hon. Friend considers what is happening, he will discover that many of those contracts are awarded on a sweetheart basis. Some of the restrictions that are placed on the tenderers for those contracts make it plain that it is the intention of the BBC that nothing shall change whatever, except that the cost of the productions shall increase because former BBC employees will be doing that production with an added fee. That was not the intention of placing a requirement on the BBC to contract out some of its work to independent producers. [Interruption]

The hon. Member for Clydebank and Milngavie (Mr. Worthington) is muttering from a sedentary position. Perhaps he can tell me how the BBC has done in reducing its prices to the consumer, just as British Telecom has reduced its prices to the consumer. If the hon. Gentleman knows the answer, he might have something to say. Would he like to tell us what has been happening to the licence fee, as opposed to telephone charges?

Mr. Tony Worthington (Clydebank and Milngavie)

Can the hon. Gentleman tell me how it is just that people all over Britain are having to pay 17.5 per cent. VAT on their telephone charges when that 17.5 per cent. VAT was not in existence from January to March this year?

Mr. Tebbit

That is a little bit off the broad scope of the debate. I will only say briefly that, so far as it is possible to do, those consumers are not being charged that additional VAT unless it is proper and appropriate that they should be.

Mr. Worthington

It sounds like a racket to me.

Mr. Tebbit

1 would be happy if my hon. Friend the Minister were able to tell us tonight that in future the BBC's licence fee would be linked to the retail prices index in the same way as British Telecom's prices—RPI minus 6.5 per cent. It would no doubt please everybody in the House to see prices coming down in that way— or would it? Perhaps not.

But as I have said, the principal threat to competition in television is, first, the continuing dominance of the BBC and secondly, and more seriously perhaps in many ways, the threat to the independent sector which is coming from the present dearth of advertising revenues. That is the problem which may well force under some of the smaller independent companies, particularly those in radio.

There has been a lot of talk this evening about the dangers of successful companies in television and radio being taken over in predatory bids. But in my experience, it is not successful companies that are taken over, but unsuccessful companies. If there is a danger at all at the moment, it lies first in the lack of advertising revenue, which springs from the considerable expansion in the number of stations spreading the revenue too thinly, and, secondly, in the recession reducing the amount of revenue available. That is where the danger lies, not from the activities of the strong, powerful and well-financed companies.

I hope that my hon. Friend, when he looks at those matters, will be entirely firm and stick to what he has said about the manner in which the restrictions will be applied to cross-media ownership. There is no requirement to strengthen the regulations beyond those which he has proposed. If anything, in the longer term, we should be looking at reducing those restrictions.

I do not find it acceptable to see that there is a monopoly because somebody is a significant operator in the printed press and the electronic media. Those are not the same areas, and I do not think that we should worry too much about it.

10.8 pm

Mr. Peter Lloyd

We began the debate earlier than we expected, so we have taken considerably more time to debate considerably more points than we might have expected to do. As a result, I have covered six or seven sides in closely written hieroglyphics which, if I tackled each one fully, would require a long speech. The House will be glad to hear that I can never read my own handwriting at this time in the evening, so I shall be brief and will refer only to the points that were directed at me which I can remember. My handwriting was rather better at the beginning of the debate when a number of points were put to me by the hon. Member for Birmingham, Erdington (Mr. Corbett).

The hon. Gentleman asked what happens if there is no bid in one region. I am not as pessimistic as he is, but if that should happen the ITC would have to advertise again. As it would have allowed the region to continue only on the basis that it was a viable one, it would be a clear signal that here was an opportunity for the hon. Member for Great Grimsby (Mr. Mitchell) to buy, if not for a penny, for a lower sum than he might have thought it would have cost him if he had made his bid in the first place.

Mr. Austin Mitchell

This is monstrous. The Minister is now changing what he said originally. My hon. Friend the Member for Birmingham, Erdington (Mr. Corbett) and I have begun to formulate our bid. Is the Minister saying that if the terms of the Act were fulfilled by a sole contender company putting in a bid of one penny that bid would be rejected?

Mr. Lloyd

If the hon. Member for Great Grimsby (Mr. Mitchell) had listened to his hon. Friend the Member for Erdington, let alone to me, he would have realised that his hon. Friend was talking about a region where there was no bid at all. What would happen then? I see that the hon. Member for Erdington is nodding in agreement. What I am saying now is on all fours with what I said before. If no second bid is made, if the hon. Member for Great Grimsby realises that he cannot manage something as complex as putting in a bid that would satisfy the quality threshold, the ITC would have to look to neighbouring licensees to run a temporary service until a satisfactory licensee could be found for the region.

The hon. Member for Erdington was worried about production facilities in the regions not being used. There is bound to be less use of production facilities of contractors and licensees because of the 25 per cent. rule, which means that 25 per cent. of output must be provided by independents. Of course, the 80 per cent. for specific contracted regional broadcasting will have to be made in the appropriate region, but the price that one pays for having independents is that they be independent enough to choose where they can best make their programmes.

The hon. Member for Great Grimsby deviated into sense when he talked about the real pressures on an organisation such as Sky, and the lack of realism shown by his right hon. and hon. Friends on the Front Bench. However, he shared their inpracticality when he said that there should be a rule about where independents should produce programmes. The whole point about independents is that they are independent people who will produce programmes that they believe are wanted, and they need to produce them as competitively as possible. It must be up to them to decide where they should do so. I am less pessimistic than the hon. Gentleman about the possibility of their not doing so in the regions.

Contrariwise, the hon. Member for Erdington was worried that the broadcasters would force independents to use facilities in the way that the broadcasters wanted them to. However, the order that we have just published on the definition of an independent—no doubt we shall debate it soon—makes it clear that such pressure must not be applied. If it were, that would be a matter for the regulatory authorities. Independents must be seen to be independent as well as actually being independent.

Mr. Tebbit

If an independent must be seen to be independent, is it reasonable of the BBC to specify to independents which might contract with it who should present a programme, and to reserve the right to approve of the choice of editor, or even to appoint the editor? Is it right that the BBC should reserve the right to approve the panellists on a programme, or that it should insist that the existing music and graphics of a programme be used, and so on? That does not leave a lot of independence, does it?

Mr. Lloyd

My right hon. Friend is extending an argument in particular directions that he was advancing generally in his speech. He has raised exactly the sort of matter that we shall consider when we debate the order that defines independents. As the evening grows late, even though we started to debate the order fairly early, I shall leave the matter until we debate the independents order, if my right hon. Friend will forgive me.

The hon. Member for Erdington wondered what would happen if broadcasters made arrangements together to sell advertising. It was part of his generalised worry about concentration of power. That would become a matter of interest to the Office of Fair Trading. The OFT has a role to ensure that real competition exists, and that extends to advertising. When the hon. Gentleman says that he is worried about concentration of ownership of the press and of television licensees, I remind him that the rules provide categorically and clearly, as does the Act, I believe—having sat through the consideration of the Bill that became the Broadcasting Act 1990, he will probably know this better than most—that no British press proprietor may own more than 20 per cent. of the shareholding of any television company. If there is any suggestion that the 20 per cent. may be a controlling interest because of the make-up of the company, the percentage holding will have to be reduced. There is no question of a concentration of power in that respect.

The hon. Member for Erdington wondered whether we would have to accept somebody's word. It is not a matter of accepting anyone's word, and that is why we are debating the order. The order stems from the Act and the rules are before us. The hon. Gentleman said that he felt that BSkyB had a monopoly of satellite broadcasting. It does not have a total monopoly because other satellite channels are available. When there is only one player in the field, that player is the monopoly. A succession of opportunities are available on Astra 1 and 2 and, it is mooted, Astra 3, for other players to move on to the field. That means that there is no monopoly in any accepted sense of that word. It is easy for competition to materialise if there is a willingness to invest resources. If that is done, the competition will find an audience.

Mr. Geoffrey Dickens (Littleborough and Saddleworth)

What would happen if there were a shareholder with a 20 per cent. holding, it was decided that there should be a rights issue and the other parties could not afford to take advantage of that issue? The holdings of the other parties would be diluted and the 20 per cent. holding would be worth more. What would the Government do in such circumstances?

Mr. Lloyd

They would not do anything. The Independent Television Commission would ensure that the 20 per cent. which had risen to whatever level was reduced at least to the previous level of 20 per cent.

Mr. Dickens

Would it buy?

Mr. Lloyd

How it reduced the holding—by giving it away, selling it or whatever—would be a matter for the commission to decide. The major requirement is that the holding should be reduced, and that it would be.

I am glad that the hon. Member for Erdington accepted—my handwriting is still quite good quality—that it was sensible for the ITC to enable BSB viewers to continue to receive broadcasts. The arrangements are temporary and the commission has some imaginative proposals for securing more programming on the Marco Polo satellite. The success of what it intends to do will depend upon individuals willingly coming forward. I hope that they will. There is no monopoly in any reasonable sense of the word because we cannot separate satellites from the rest of broadcasting that is available. Satellite broadcasting represents an extremely small proportion of broadcasting as a whole.

The hon. Member for Erdington thought that the Government should refer the BSB-Sky merger to the Monopolies and Mergers Commission. If the hon. Gentleman reflects upon the matter, he will recall that it was considered by the OFT, which found no basis whatever for a reference to the M MC. That is hardly surprising, as the combined satellite broadcasts account for far less than 10 per cent. of all broadcasting.

My hon. Friend the Member for Thanet, North (Mr. Gale) expressed similar concerns about the decreasing use of production facilities in the provinces. I hope that he accepts that the points that I made earlier apply very much to what he said. He is being too pessimistic. We must accept that the independents, as well as the licensees, should make those programmes where they think that they can best make them.

My hon. Friend said that there was an insufficient number of radio frequencies. The Radio Authority intends to advertise 30 new franchises a year. That would be quite demanding of the skills and experience available in the industry. I doubt whether it would be practical or sensible to go very much further, but that is a matter for the authority. It is important, and will be in the coming years, that more frequencies are released. I have that very much in mind in my discussions with the BBC and my colleagues at the Department of Trade and Industry, who have responsibility for the distribution of wavelengths.

My hon. Friend was right to say that Sky has extended, at great cost, the choice available to viewers and that further advances such as digital, which is on the horizon, will not be made if those willing to take that sort of risk did not have the freedom to do so. Many of the Labour party's suggestions for further restrictions would make such advances impossible. I noted what my hon. Friend said about the televising of proceedings in the House. That is a matter not for me but for the House.

The hon. Member for Caithness and Sutherland (Mr. Maclennan) and I have had a sufficient number of exchanges about BSB dishes for me now to pass over that point. He asked about the levy, but it would not be proper for me to comment on that at any length. I hope that Mr. Speaker will prove a light-handed regulator and will allow me to say that there is great concern in the television industry about the weight of the levy bearing down upon it at a time when advertising revenue has been reduced. I keep that matter in mind in discussions with Government colleagues. We have not yet reached a conclusion, but I hope that we will do so soon. The levy does not directly affect the new licences and the bidding for them. By the time that the new licences are on the air in 1993, the levy will be a thing of the past.

I was pleased that the hon. Gentleman was pleased with the changes in the continuity rules, even if he would have preferred us to go further. I do not accept his fear that radio will be concentrated in fewer and fewer hands. Advertising on radio has been maintained at a rather better level than on television. He referred to the rule in the Act that no one should own more than 20 stations. I draw his attention to the rule that does not alow anyone to own stations that would give them more than 15 per cent. of the totality of points, which are calculated according to the reach of the stations that are operational, and which, as new stations come along, will tend to increase.

My hon. Friend the Member for Ryedale (Mr. Greenway) spoke, as usual, knowledgeably and wisely. I am glad to have his support for our arrangements under the order. I confirm that the provision in the Act for exceptional circumstances is there to be used. The Independent Television Commission knows that, and will use it as it judges appropriate. It is not for Ministers to say when it should do so. However, I confirm that it is well aware that it has that power and a duty to use it whenever it considers it necessary.

The hon. Member for Great Grimsby was excited and entertaining, and I enjoyed listening to him. Some of his remarks related to the order. All hon. Members, especially Opposition Members who expect to remain in opposition, have the failing of wanting everything both ways—or even three or four ways. The independents have been given the opportunity to make programmes and have been given a space in the BBC and ITV to make up to at least 25 per cent. of those companies' programmes. Inevitably, they will choose where and how to make the programmes. If the hon. Member for Great Grimsby feels that the Labour party should be more sensitive to the realities of the world of Sky Television, I suggest that he should be more sensitive to independent production.

Mr. Austin Mitchell

That was not the point that I was making. I asked what happens to the existing centres of production run by existing companies.

Mr. Lloyd

Some will be sold and others will be used. Any superfluous assets will be dealt with by the owners in the best possible way. It is not for the Government to lay down prescriptions. Even if I had an idea about how they could best be used, I am sure that the companies would feel that they knew better, and I would not argue with them about that.

The hon. Member for Great Grimsby said that the rules were extremely complicated. They are quite complicated and he should read them carefully. He would need to read them several times but, if he did so, he would find that they were quite clear. They would assure him that there was not the concentration of power in radio or television that Opposition Members fear. I have no such fears, not because I am in favour of concentration—I am emphatically against it—but because the rules will guard effectively against it. I therefore commend them to the House.

Question put:—

The House divided: Ayes 163, Noes 102.

Division No.127]	[10.27 pm
AYES
Aitken, Jonathan	Brazier, Julian
Alison, Rt Hon Michael	Bright, Graham
Amess, David	Brown, Michael (Brigg & Cl't's)
Amos, Alan	Browne, John (Winchester)
Arbuthnot, James	Buck, Sir Antony
Arnold, Jacques (Gravesham)	Budgen, Nicholas
Arnold, Sir Thomas	Burns, Simon
Ashby, David	Burt, Alistair
Barnes, Mrs Rosie (Greenwich)	Butterfill, John
Beaumont-Dark, Anthony	Carlisle, John, (Luton N)
Bellingham, Henry	Carrington, Matthew
Bennett, Nicholas (Pembroke)	Carttiss, Michael
Benyon, W.	Channon, Rt Hon Paul
Bevan, David Gilroy	Chapman, Sydney
Blackburn, Dr John G.	Chope, Christopher
Blaker, Rt Hon Sir Peter	Clark, Rt Hon Alan (Plymouth)
Bonsor, Sir Nicholas	Colvin, Michael
Bottomley, Peter	Coombs, Anthony (Wyre F'rest)
Bottomley, Mrs Virginia	Cope, Rt Hon John
Bowden, Gerald (Dulwich)	Cormack, Patrick
Bowis, John	Couchman, James
Brandon-Bravo, Martin	Cran, James

Curry, David	Maude, Hon Francis
Davis, David (Boothferry)	Maxwell-Hyslop, Robin
Day, Stephen	Mayhew, Rt Hon Sir Patrick
Dickens, Geoffrey	Meyer, Sir Anthony
Dorrell, Stephen	Miller, Sir Hal
Douglas-Hamilton, Lord James	Mills, Iain
Durant, Sir Anthony	Miscampbell, Norman
Dykes, Hugh	Mitchell, Andrew (Gedling)
Emery, Sir Peter	Mitchell, Sir David
Evennett, David	Monro, Sir Hector
Fallon, Michael	Morrison, Rt Hon Sir Peter
Favell, Tony	Moss, Malcolm
Fishburn, John Dudley	Neale, Sir Gerrard
Franks, Cecil	Nelson, Anthony
Freeman, Roger	Neubert, Sir Michael
French, Douglas	Nicholson, David (Taunton)
Gale, Roger	Onslow, Rt Hon Cranley
Glyn, Dr Sir Alan	Paice, James
Goodlad, Alastair	Patnick, Irvine
Gorman, Mrs Teresa	Patten, Rt Hon Chris (Bath)
Greenway, Harry (Ealing N)	Pattie, Rt Hon Sir Geoffrey
Greenway, John (Ryedale)	Porter, David (Waveney)
Griffiths, Peter (Portsmouth N)	Powell, William (Corby)
Hague, William	Redwood, John
Hamilton, Hon Archie (Epsom)	Riddick, Graham
Hamilton, Neil (Tatton)	Sackville, Hon Tom
Hampson, Dr Keith	Shaw, Sir Giles (Pudsey)
Hargreaves, A. (B'ham H'll Gr')	Shaw, Sir Michael (Scarb')
Hargreaves, Ken (Hyndburn)	Shepherd, Colin (Hereford)
Harris, David	Skeet, Sir Trevor
Haselhurst, Alan	Soames, Hon Nicholas
Hawkins, Christopher	Stanbrook, Ivor
Hayhoe, Rt Hon Sir Barney	Stevens, Lewis
Hayward, Robert	Stewart, Andy (Sherwood)
Heathcoat-Amory, David	Taylor, John M (Solihull)
Hicks, Mrs Maureen (Wolv' NE)	Taylor, Teddy (S'end E)
Hicks, Robert (Cornwall SE)	Tebbit, Rt Hon Norman
Howard, Rt Hon Michael	Thompson, Patrick (Norwich N)
Hunter, Andrew	Thorne, Neil
Irvine, Michael	Thornton, Malcolm
Jack, Michael	Thurnham, Peter
Johnson Smith, Sir Geoffrey	Twinn, Dr Ian
Jones, Robert B (Herts W)	Viggers, Peter
Jopling, Rt Hon Michael	Walker, Bill (T'side North)
Key, Robert	Waller, Gary
King, Roger (B'ham N'thfield)	Ward, John
Kirkhope, Timothy	Watts, John
Knapman, Roger	Wells, Bowen
Knight, Greg (Derby North)	Wheeler, Sir John
Knowles, Michael	Whitney, Ray
Knox, David	Widdecombe, Ann
Latham, Michael	Wiggin, Jerry
Lawrence, Ivan	Wilshire, David
Lilley, Rt Hon Peter	Winterton, Mrs Ann
Lloyd, Sir Ian (Havant)	Wood, Timothy
Lloyd, Peter (Fareham)	Yeo, Tim
Lyell, Rt Hon Sir Nicholas	Young, Sir George (Acton)
Maclean, David
McLoughlin, Patrick	Tellers for the Ayes:
Madel, David	Mr. Nicholas Baker and Mr. Tim Boswell
Mans, Keith
Martin, David (Portsmouth S)

NOES
Adams, Mrs Irene (Paisley, N.)	McAllion, John
Alton, David	McKay, Allen (Barnsley West)
Archer, Rt Hon Peter	McKelvey, William
Barnes, Harry (Derbyshire NE)	McLeish, Henry
Battle, John	Maclennan, Robert
Beggs, Roy	McMaster, Gordon
Benn, Rt Hon Tony	McWilliam, John
Bennett, A. F. (D'nt'n & R'dish)	Madden, Max
Bermingham, Gerald	Marek, Dr John
Brown, Nicholas (Newcastle E)	Marshall, David (Shettleston)
Bruce, Malcolm (Gordon)	Meale, Alan
Caborn, Richard	Michie, Bill (Sheffield Heeley)
Callaghan, Jim	Mitchell, Austin (G't Grimsby)
Campbell, Menzies (Fife NE)	Moonie, Dr Lewis
Carlile, Alex (Mont'g)	Morgan, Rhodri
Corbett, Robin	Mullin, Chris
Cousins, Jim	Oakes, Rt Hon Gordon
Crowther, Stan	O'Brien, William
Cryer, Bob	O'Hara, Edward
Cummings, John	Patchett, Terry
Dalyell, Tam	Pike, Peter L.
Darling, Alistair	Powell, Ray (Ogmore)
Davis, Terry (B'ham Hodge H'l)	Primarolo, Dawn
Dixon, Don	Quin, Ms Joyce
Dobson, Frank	Radice, Giles
Doran, Frank	Randall, Stuart
Duffy, A. E. P.	Reid, Dr John
Eastham, Ken	Robinson, Geoffrey
Fearn, Ronald	Rogers, Allan
Flynn, Paul	Rooker, Jeff
Foster, Derek	Ross, William (Londonderry E)
Foulkes, George	Rowlands, Ted
Galloway, George	Ruddock, Joan
George, Bruce	Skinner, Dennis
Golding, Mrs Llin	Smith, Andrew (Oxford E)
Gordon, Mildred	Snape, Peter
Griffiths, Nigel (Edinburgh S)	Soley, Clive
Griffiths, Win (Bridgend)	Steel, Rt Hon Sir David
Grocott, Bruce	Taylor, Mrs Ann (Dewsbury)
Hain, Peter	Taylor, Matthew (Truro)
Haynes, Frank	Vaz, Keith
Hogg, N. (C'nauld & Kilsyth)	Wallace, James
Home Robertson, John	Warden, Gareth (Gower)
Hood, Jimmy	Watson, Mike (Glasgow, C)
Howells, Geraint	Welsh, Michael (Doncaster N)
Hughes, John (Coventry NE)	Williams, Alan W. (Carm'then)
Hughes, Simon (Southwark)	Wilson, Brian
Ingram, Adam	Winnick, David
Lamond, James	Worthington, Tony
Lestor, Joan (Eccles)
Livsey, Richard	Tellers for the Noes:
Lofthouse, Geoffrey	Mr. Thomas McAvoy and Mr. Jimmy Dunnachie
Loyden, Eddie

Question accordingly agreed to.

Resolved, That the draft Broadcasting (Restrictions on the Holding of Licences) Order 1991, which was laid before this House on 28th March, be approved.

1. PETITION
c1183
1. Cosmetics (Animal Testing) 168 words