Commons Sitting of 2 July 1996

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
Oral Answers to Questions
  ENVIRONMENT

    Local Authority Capital Programmes
    Dr. Lynne Jones: To ask the Secretary of State for the Environment what submissions he has received from the local authority associations concerning councils' capital programmes. [33931]
    The Secretary of State for the Environment (Mr. John Gummer): This and other topics are discussed regularly at my meetings with the local authority associations.
    Dr. Jones: Does the Secretary of State accept that local authorities, such as Birmingham, need increased—not reduced—capital investment to provide new homes and to renovate existing, but crumbling, schools, homes and the road infrastructure? Will he ensure that the Deputy Prime Minister's commitment to the Association of Metropolitan Authorities last year is honoured and that the private finance initiative is used to generate additional resources rather than to substitute for public borrowing?
    Mr. Gummer: The city of Birmingham has gained a considerable amount of money through the single regeneration budget. Birmingham City Pride, as an organisation, has provided the basis for many of the council's claims, and Birmingham will doubtless make an application under capital challenge. The private finance initiative will give many opportunities for Birmingham to operate satisfactorily. The council needs to make its relationships with the private sector even more effective, and that will give a result of which Birmingham can be proud.
    Mr. Harry Greenway: Is my right hon. Friend aware of the way in which so many Labour councils misrepresent capital receipts, capital funding and the standard spending assessment? In Ealing, the Labour council is already pretending that it will get £10 million less than it should have in the coming year, even though it cannot possibly have the slightest idea what its position will be. It also pretends that it did not have an increase last year, when it had a very good increase of £5 million. What can my right hon. Friend do to assert the truth when councils misrepresent the situation so badly?
    Mr. Gummer: Ealing is one of the worst councils for such statements. I live in Ealing during the week and it is difficult to find much that Ealing council says that has much to do with the truth.
    704
    On the question of paying set-aside receipts, it is interesting that the Labour party has not yet admitted that, to do what it wants to do, it would have to take receipts from some boroughs and give them to other boroughs; otherwise, the two most needy boroughs in London, Hackney and Lambeth, would get no money because they have no receipts to apply and, no doubt, the money would come from other boroughs, such as Enfield and Barnet, which were sensible enough under Conservative control to gain receipts. Sensible boroughs' receipts would be taken away, their council taxes would go up, because they would no longer be able to subsidise them from the interest rates, and the money would go to Lambeth and Hackney—the boroughs that wasted the money in the first place.
    Mr. Sutcliffe: Local authority capital programmes, especially social service ones, will be affected by last week's decision by the Court of Appeal on social service charges. What help and assistance will the Secretary of State give local authorities whose budgets will be depleted as a result of that ruling?
    Mr. Gummer: No doubt local authorities will have to decide how that ruling affects them and the capital effects it will have. Local authorities spend large sums of capital and the opportunities have been enormously increased by the private finance initiative. The problem is that many local authorities fail to use the private finance initiative, even though it is available. For example, Ipswich has failed to use the PFI to build a crematorium and wants to use money from the taxpayer.

    Out-of-town Retail Developments
    Mr. Gale: To ask the Secretary of State for the Environment what plans he has to reflect (a) through uniform business rates and (b) otherwise the effect of out-of-town retail developments on high streets and town centre retail businesses. [33933]
    The Minister for Construction, Planning and Energy Efficiency (Mr. Robert B. Jones): Where the presence of an out-of-town centre affects the value of town centre shops, this will be fully reflected in rating valuations. We have just issued revised planning policy guidance, PPG6, which will encourage developers of retail and other town centre uses to locate in town centres. We also encourage local authorities to develop town centre management to improve their competitiveness.
    Mr. Gale: My hon. Friend is aware that in Northdown road in Cliftonville, formerly one of the south-east's fine shopping centres, there are now 40 empty shops, and there are more in Margate high street. That situation is common across the south-east of England and the coastal towns. Some of those voids are undoubtedly due to out-of-town shopping. Another out-of-town retail development has just been granted planning consent on appeal. Has not the time now come for my hon. Friend to consider whether the 1995 revaluations were hopelessly unrealistic, and should we not be considering a zero increase in business rates for the coming year?
    Mr. Jones: Where there is a material change of circumstances, retailers and others can go back to the Valuation Office and have their cases reconsidered; but

    705
    my hon. Friend must remember that not only are we restating our principles in PPG6 but we are vigorously carrying that forward into effect.
    Mr. Matthew Taylor: Is it not a fact that merely devaluing the rates because a property has been devalued does nothing to compensate shop-holders whose livelihoods may be lost and, more important, does nothing to help the community whose heart is being ripped out by out-of-town developments? Is it not a fact that the latest announcements by out-of-town retailers of further plans for further superstore developments show that the Government's policy to get people back into town centres is failing?
    Mr. Jones: Retailers can make as many proposals as they want, but they still have to get through the planning system. My experience during the time I have been doing this job is that it is primarily Labour-controlled and hung councils that ask us to relax our planning approach, admittedly generally in the interests of regeneration, but not necessarily in the interests of the town centres.
    Sir John Cope: Is my hon. Friend aware that the existence of out-of-town shopping is not the only reason for giving careful attention to the burden of uniform business rates on small firms, particularly on small retail firms? My hon. Friend should consider it carefully for all sorts of other reasons as well—notably, the system of valuation.
    Mr. Jones: The system of valuation has been with us a long time, but that is not to say that it is perfect, and I am happy to consider any suggestions that my right hon. Friend may make for its refinement. My right hon. Friend is right to say that small firms in particular tend to be concerned about the swings that occur between different valuation periods, but the economy has been different at those different points and that has led to changes in the valuations, both in the south-east and, latterly, in outer parts of the country.
    Mr. Stevenson: Is not the truth of the matter that the uniform business rate now accounts for a higher proportion of local government expenditure than when the Government imposed the system? If we add to that laissez faire planning policies that have led to more out-of-town shopping centres, has not the small business in inner-town areas suffered a double whammy? Given the seriousness of the situation, is not the Minister's response totally inadequate?
    Mr. Jones: The hon. Gentleman should visit Hemel Hempstead in my constituency, where a recent audit of the town centre has shown vigorous and increasing prosperity.
    On the uniform business rate, the Government have ensured that the take is limited to the rate of inflation each year. When Labour-controlled councils had control of the business rate locally, they used to rip off businesses every year. If the hon. Gentleman is suggesting that if the Labour party were ever to come to power it would get rid of the uniform business rate, that would mean new taxes with new Labour.

    Challenge Funding
    Mr. Jacques Arnold: To ask the Secretary of State for the Environment if he will make a statement about his plans to extend challenge funding. [33934]
    Mr. Gummer: We announced on 15 May the Government's decision to proceed with a pilot scheme for the allocation of local authority credit approvals through competitive bidding.
    Mr. Arnold: My right hon. Friend will know that there are no greater fans of the Government's challenge fund than the people of Gravesend. For years, we waited for our county and borough councils to bring about urban regeneration and the relief of the ancient area of Old Denton. Now, the Government's challenge fund is bringing together voluntary organisations, companies and the local councils to find a solution in that urban area. So great is that enthusiasm, that Gravesham borough council is putting in a new application for improvements along the riverside, on which I hope my right hon. Friend will look benevolently.
    Mr. Gummer: I cannot prejudge what the decision will be, but it is interesting that Labour councils such as Gravesham are beginning to realise that the challenge fund is a way of bringing together need and the ability to meet that need, instead of making decisions according to need. In the past, we wasted a great deal of money by allocating it to areas that were in need, but were unable to use the money effectively. By using the challenge fund, we ensure that they can meet the need, and they do so in partnership with the private sector, voluntary organisations and other agencies. That is the way to regenerate our cities, not the old-fashioned, socialist manner.
    Mr. Vaz: Why does the right hon. Gentleman not accept what everyone now realizes—that competition, the policy principle at the heart of his regeneration strategy, has been totally discredited? Is it not patently absurd to set towns and cities against each other to compete for diminishing regeneration funds? Will the right hon. Gentleman therefore publish what Labour has requested for the past two years—comprehensive regional statements on which councils can bid for regeneration funds against an understandable, clear and coherent criterion of need?
    Mr. Gummer: The hon. Gentleman has already lost the argument. The Environment Select Committee has said that the competitive system, the single regeneration budget, is extremely successful. Labour council leaders around the country tell me that they like the competitive system because it shows them to be successful when they do it well and it shows up their Labour neighbours when they do it badly. The only people who do not like the competitive system are bad Labour councils and those dominated by trade unions who do not want any competition. As usual, the hon. Gentleman is out of date. New Labour not only means a new attitude; it means a new attitude to measures that have been good—that is, to deny them and destroy them.
    Sir Irvine Patnick: As my right hon. Friend will be aware, Sheffield city council made two successful bids in city challenge amounting to £74 million. That is to be commended, as it has brought in £140 million from external funding, including £90 million from the private sector. Some of that money will be used to improve property and assist with training and business start-ups. Is it not the way forward? Should not cities such as Sheffield—even Sheffield—be commended?
    Mr. Gummer: Oh, yes. My hon. Friend will accept that, when I want to Sheffield, the Labour council leader had no complaints about his success. His only complaints were about the two previous leaders, both of whom sit in the House, who had run Sheffield into the ground so that it now needs urban regeneration. He is still paying the debts left by previous council leaders. He is still paying debts on the backs of the people of Sheffield because such a capital system did not exist.

    Pollution
    Mr. Win Griffiths: To ask the Secretary of State for the Environment if he will make a statement about the latest levels of atmospheric pollution and the plans he has to reduce it. [33935]
    The Parliamentary Under-Secretary of State for the Environment (Mr. James Clappison): Air quality in the United Kingdom is generally good or very good most of the time. We shall shortly be publishing a consultation draft national air quality strategy.
    Mr. Griffiths: Would the Minister like to tell us whether he intends to give local authorities additional powers to act against pollution black spots, and whether there are any proposals for a national approach to deal with pollution problems, which are very severe in some cities and cause real damage to the health of adults and children?
    Mr. Clappison: As the hon. Gentleman may know, 80 local authorities in 14 different areas—including some in south Wales—are trialling the duties under the Environment Act 1995. Resources have been made available to assist them and we shall look at the implications of that trial period.
    The national air quality strategy to which I referred is a comprehensive strategy for dealing with emissions and will lead to major improvements in air quality, in addition to the improvements that we have already made in reducing lead, sulphur and other harmful emissions under our international commitments.
    I appreciate the hon. Gentleman's interest in this matter. It is a shame that there is not more constructive interest from those on the Labour Front Bench. The only emissions that are apparent from the Labour party are internal emissions, particularly from south Wales.
    Mr. Evennett: Is my hon. Friend aware that there is growing concern about air quality in my borough of Bexley? When he publishes his draft document, will he include some proposals to deal with the growing problem of air pollution in the London area?
    Mr. Clappison: My hon. Friend makes an important point. Local authorities will have powers: local authority air management areas will be established. My hon. Friend will also be interested in the action that we have taker to deal with summertime smog, and in the recent conference of north-west European countries, hosted by my right hon. Friend the Secretary of State, which discussed that international problem. The conference set the aim of reducing it, and if possible eliminating it, by 2005.
    Mrs. Helen Jackson: Does the Minister agree with the report published recently by the Environmental Industries Commission, which states that those industries have lost £2 billion because of the Government's failure to regulate? The problem has been exacerbated by the two-year delay in the control of volatile organic compound emissions. Is this not another example of the Government's producing warm green words and absolutely no action?
    Mr. Clappison: The hon. Lady completely misunderstands the VOC issue. As she will know, we have entered into a protocol on VOCs under the United Nations Economic Commission for Europe, and we are well on the way to meeting our international commitments—as we are in regard to other emissions. What we are prepared to be judged on is our success in meeting international obligations. When we set targets and agree to obligations, we meet them, and that results in better air quality.

    Local Authority Houses
    Mr. Skinner: To ask the Secretary of State for the Environment what, at the latest date for which figures are available, was the number of local authority dwellings. [33937]
    The Minister for Local Government, Housing and Urban Regeneration (Mr. David Curry): At the beginning of April 1995, there were 3,565,000 local authority dwellings in England.
    Mr. Skinner: Is it not almost unbelievable that, during 1995, local authorities, deprived of money by this Tory Government, were unable to build more than 612 houses in one year? In 1978, which we regarded as a bad year for Labour, 78,000 houses were built. The ratio between the number of houses being built now and the number being built in the years before the Labour Government were kicked out of office is about 80:1. Is it not high time that the Government worked it out? There are millions of bricks in stock; people are lying on the streets and in doorways; builders and construction workers are without jobs. You do not have to be a Pythagoras to solve that theorem—but then this Government are not capable of anything.
    Mr. Curry: Let me tell the hon. Gentleman how pleased I am to see him here and in such good voice.
    Earlier today, the hon. Gentleman gave notice that he was unstarring his question. I knew that the Labour party intended to discipline dissident Members, and I was rather afraid that the hon. Gentleman had already been liquidated. I am glad that he is back—but he is back with exactly the same attitude that he had nearly 20 years ago,

    709
    which is that housing must be built by councils. We have moved on from that old agenda to allowing building by housing associations, giving tenants the right to own their property and letting local authorities transfer property to the private sector.
    Three weeks ago, I announced estate challenge results that allowed some of the worst estates to be moved to new landlords, subject to a ballot. Just three weeks later, Durham has already balloted its tenants. Those tenants do not want the hon. Gentleman's old-fashioned style; they want the new policies that give them better opportunities and new hope. The hon. Gentleman will die with the old Labour ship.
    Mr. Yeo: In view of the concern expressed by the hon. Member for Bolsover (Mr. Skinner), will my right hon. Friend join me in looking forward to his enthusiastic support for recent proposals from the Ministry of Defence which will ensure that the most effective use is made of the large number of houses that it owns?
    Mr. Curry: One can always live in hope, although it must be said that, in the case of the hon. Member for Bolsover (Mr. Skinner), there is not much hope.
    The MOD's proposals will produce two important results. First, they will enable empty stock to be brought into productive use; it is a scandal that it has not been already. Secondly, they will allow houses inhabited by service personnel to be brought up to a proper standard, so that those people have the houses that they deserve. That is not the case at present, which is a very good argument for going ahead.
    Mr. Raynsford: Will the Minister now recognise that under his Government, the output of new housing for renting has fallen to its lowest level since the end of the second world war? At the same time, the number of homeless people in Britain has doubled since Labour was last in power. When will the Government face their responsibilities and get unemployed building workers back to work building the homes that are needed, letting councils use their capital receipts to finance that building?
    Mr. Curry: The hon. Gentleman keeps returning to his old anthem about capital receipts, but it is a myth that that money is doing nothing. Those receipts have been invested and are earning interest. If they were not, council tax bills would go up.
    The hon. Gentleman is at pains to say, "No spending commitments." Even in the most informal setting, one could not prise a spending commitment out of him with forceps. If that money were put into house building, it would be bound to affect the public sector borrowing requirement, and other expenditure by local authorities would have to be pruned if public expenditure were not to rise. The hon. Gentleman must answer that question.
    Like the hon. Member for Bolsover, with whom I doubt he would want to compare himself, the hon. Gentleman still represents the old municipal side of Labour. We and the agenda have moved on from that, and we are moving tenants with us to much greater opportunities. They will not want the hon. Gentleman's remedies thrust down their throats.
    Mr. Dunn: In the context of local authority dwellings, does my right hon. Friend agree that there are thousands of empty properties in housing black spots such as Lambeth, Lewisham and Liverpool which are not well administered by local authorities? Is this not the question that we should be asking: "Why do these black spots exist and which party has created them"?
    Mr. Curry: My hon. Friend is absolutely right. The essential skills of a local authority are to fill voids and collect rents. When it does not do that, people are deprived of homes and the borough is deprived of revenue for its services. There are 600,000 to 800,000 empty properties around the country and they must be brought back into use. It would be more sensible to do that than to have them lying idle. Some of them are in the private sector, but too many are still in the public sector and need to be utilised.

    Local Authority Capital Programmes
    Mr. Hanson: To ask the Secretary of State for the Environment what contribution he estimates the private finance initiative will make to the capital programme of local authorities. [33938]
    Mr. Robert B. Jones: The private finance initiative offers potential for significant additions to local authority capital investment in the coming years. That is why my right hon. Friend the Minister for Local Government, Housing and Urban Regeneration announced on 21 May substantial changes to the local government capital finance regulations to facilitate the further development of the private finance initiative.
    Mr. Hanson: Does the Minister accept that, in the absence of proper local capital spending programmes by central and local government, the private finance initiative is becoming increasingly attractive to many local authorities? Does he also accept that the 32 regulations are red tape that needs to be removed and that we need clear, open guidance for local authorities so that the backlog on the private finance initiative is made available? In future, local authorities must have a clearer idea of what the private finance initiative means.
    Mr. Jones: I am glad that the hon. Gentleman welcomes the private finance initiative, and I hope that he will get that message across to some of his hon. Friends who still seem hostile to the idea of involving private sector capital.
    Of course we want to make sure that there is no red tape. That is why my right hon. Friend has had three different tranches of measures to strip away the bureaucracy. We are prepared to look at any suggestions by local authorities about other areas that are worthy of examination.
    Of course bureaucracy is a problem not just on the regulatory side. We have to ensure that local authorities, as clients, do not have fussy contract documents or overlong tender lists or other measures that would block a good package.
    Ms Armstrong: The Minister's staggering complacency is almost beyond words. Has he not noticed that, in the past few weeks, the confidence of the private sector has virtually collapsed? The legal decision added to the regulatory regime have prompted it to say, certainly to us, that it has no confidence in the ability of the private finance initiative further to push capital development by local authorities. Will the hon. Gentleman therefore quickly review the position, because the construction industry and, more important, the public are suffering enormous losses as the necessary capital investment is simply not being made?
    Mr. Jones: What we have witnessed is the staggering ignorance of the hon. Lady. If she talked to individual construction companies throughout the country that are involved in submitting projects and having them assessed, or met the construction industry on a national basis, as I do, she would know that they are enthusiastic about this and view it as the way forward.

    Construction Industry
    Mr. Nicholas Winterton: To ask the Secretary of State for the Environment if he will make a statement on the condition of the construction industry with particular reference to the house building sector. [33940]
    Mr. Gummer: There is evidence of increasing activity in the housing market as the effects of our sound economic management work through to improve consumer confidence. We look forward to a continuing recovery this year.
    Mr. Winterton: I congratulate my right hon. Friend on his excellent and far-sighted speech to the Royal Town Planning Institute, and on highlighting the need to build more houses to meet the growth in household numbers, but is he aware that his wise words are falling on deaf ears, with county councils from Devon to Oxfordshire and from Hampshire to Cheshire ignoring the housing numbers required in regional guidance? Will he assure me that he will advise those county councils seeking to pass the housing buck that he will ensure that housing numbers in the structure plans are properly adhered to?
    Mr. Gummer: I am sure that the House would want to congratulate my hon. Friend on his chairmanship of the Manufacturing and Construction Industries Alliance Ltd., which has been expressing these views. I am especially concerned that we use all the land that has already been used to rebuild in the centres of our cities. I am still concerned about many local authorities that are not prepared to put together the land and to create opportunities for private builders, to build in those circumstances. I am insisting that the amount of land that needs to be released because of the figures shall be so released.
    Mr. Dobson: The Secretary of State said in his speech, to which reference has been made, that the Government were estimating that an extra 4.4 million homes would be needed just to meet the needs of new households in the next 20 years, and that that excludes the 1.5 million homes that need to be done up because they are unfit for human habitation. Is it not the case that we are building only
    712
    137,000 homes a year, which means that, at the present rate, the Government will fall 1.5 million homes short of their target? Would it not be a better idea if, instead of calling for national debates, the right hon. Gentleman got on with getting some houses built now, rather than talking about the far blue yonder, when he will not be in power because new Labour will be in new government?
    Mr. Gummer: I had to give the hon. Gentleman an opportunity for the debate, because he has already contributed to both sides of it. First, he told the Union of Construction Allied Trades and Technicians that not enough houses were being built.
    Mr. Dobson: Liar.
    Mr. Gummer: Then the hon. Gentleman told the Council for the Protection of Rural England that he would not build as many houses. [Interruption.] Oh yes.
    Mr. Dobson: Liar.
    Mr. Gummer: I will quote the hon. Gentleman's words in case he forgets them:
    "we are looking at … shifting … from the present presumption in favour of development … 4.4 million households is a major threat to rural England."
    That is the opposite of what he said only a few days before. His speech to the CPRE was a disaster. It knows that the only defenders of rural England are Conservative Members, that the only people who protect the green belt are Conservative Members, and that new Labour means a new threat for the countryside of Britain.
    Mr. Harry Greenway: On a point of order, Madam Speaker.
    Madam Speaker: I do not take points of order until after questions.
    Mr. Greenway rose—[Interruption.]
    Madam Speaker: Order. How can I hear what the hon. Gentleman is saying with everyone bawling and shouting? Do shut up until Mr. Greenway has said what he wants to say.
    Mr. Greenway: I distinctly heard the Labour party spokesman use the unparliamentary term "liar" at least five times. Is that in order?
    Madam Speaker: Is that the case?
    Mr. Dobson: I did use that word and I withdraw it.
    Madam Speaker: I am obliged. The hon. Gentleman admits to using the word and it has now been withdrawn. Who was I about to call? I want somebody who can put a direct question. I call Mr. Coombs.
    Mr. Anthony Coombs: Will my right hon. Friend confirm that recent surveys by the Council of Mortgage Lenders and the Royal Institute of Chartered Surveyors show a significant improvement in sentiment in the housing market and considerably improved activity? Is

    713
    that not the result of sustained low interest rates? Is it not a bit rich for the Labour party, in the form of its shadow spokesman, to talk about improving consumer confidence when the last time the Labour party was in government there was an average rate of interest—
    Madam Speaker: Order. I remind the hon. Gentleman, although he should not need reminding, that Ministers of the Crown are responsible for their policies. They are accountable to the House not for anybody else's policies, but for their own actions. Let us now see if we can find a decent question somewhere. I call Mr. Tony Banks.

    County Hall, London
    Mr. Tony Banks: To ask the Secretary of State for the Environment what applications under the Convention on International Trade in Endangered Species regulations have been made in respect of an aquarium in county hall, London SE1. [33941]
    Mr. Clappison: None.
    Madam Speaker: That is a good answer.
    Mr. Banks: You may think so, Madam Speaker, but it is a terrible answer.
    Madam Speaker: At least it is a straightforward answer.
    Mr. Banks: Unfortunately, it is not a helpful one, as an aquarium is due to open at county hall and it would appear that the Shirayama corporation, which is to run the aquarium, has not yet sought permission from the Department of the Environment for the species that it intends to import. Will the Minister check what species the organisers intend to put into the aquarium? It is not at all acceptable in terms of animal welfare. In view of what the Japanese are doing in the Antarctic—killing minke whales under the guise of scientific whaling in order to eat them—will the Minister check that they will not use the aquarium in county hall to bring in dolphins so that they can serve whale meat in the restaurants?
    Mr. Clappison: I can help the hon. Gentleman. I understand that the organisation has applied under the Zoo Licensing Act 1981. Notwithstanding the building's former use, apparently such an application is required. I should have thought that the hon. Gentleman's hon. Friend the Member for Brent, East (Mr. Livingstone) would approve of the use of county hall as an aquarium. I cannot say whether there will be any newts in the aquarium, but it will definitely contain dog-faced puffers, tomato clown fish and red-bellied piranhas, among others. I understand that no application is required under CITES. I know that the hon. Member for Newham, North-West (Mr. Banks) is an expert on endangered species, and also something of an authority on endangered species within the Labour party—Members who speak their mind.
    Mr. Bernard Jenkin: Does my hon. Friend recall a time when certain unattractive species used to inhabit county hall? Can he give an undertaking that those
    714
    dangerous and expensive species, who promised to spend a great deal of money to no good effect, will never be allowed back into county hall?
    Mr. Clappison: Thankfully, that species is becoming endangered and will become even more so when the public hear of the plans to create unnecessary bureaucracy and waste in London with organisations which duplicate work being done by others, all of which will result in substantial expense for London taxpayers—a new form of danger from new Labour.

    Millennium Exhibition
    Sir Michael Neubert: To ask the Secretary of State for the Environment what plans he has to enhance the riverside amenities in the vicinity of the north Greenwich peninsula in preparation for the holding of the millennium exhibition there. [33942]
    Mr. Gummer: We shall ensure that the Greenwich peninsula is properly reorganised and redeveloped in a manner that will be not only important for the millennium exhibition but valuable to the citizens of London for the rest of the century. If my hon. Friend has any supplementary questions, I shall be happy to answer them.
    Sir Michael Neubert: Does my right hon. Friend accept that it is important that the millennium exhibition should not introspectively gaze only at its navel but should look outwards to the river, that great but greatly underused natural highway which flows through our capital and around the north Greenwich peninsula? Impressive though the Jubilee line extension will be when it is completed, should we not give every encouragement to those wishing to experience an approach to the exhibition from the water, as was the case with the festival of Britain, when more than 5 million people took to the Thames for their transport?
    Mr. Gummer: The Thames should be used as one of the accesses to the millennium exhibition. It is also important that we improve that area of London, which has been particularly damaged by successive Labour councils in the borough of Greenwich, where the development has not been helped. I hope that the effect of the single regeneration budget, which is certainly one of the ways in which to help that development, will enable other sources to be tapped. The river is crucial to the overall development of an area which, sadly, has been neglected for many years.
    Mr. Spearing: Is the Secretary of State aware that immediately to the north of the chosen millennium site at Greenwich are two sites available in the London borough of Newham? As he knows, the first is within 500 yd of the millennium site and is the two and a half miles of the royal docks. It has great potential for development, including a national exhibition centre. Secondly, within a mile to the north, the lower Lea valley could add to the millennium celebrations 100 acres of land for which the Government have so far failed to provide a reasonable and imaginative scheme, as we should all like.
    Mr. Gummer: Much as I respect the hon. Gentleman, who has made a great contribution, I wonder how he can celebrate all the work that has been done by the London Docklands development corporation in view of the extent to which he and his fellow socialists attacked it and said that it was unacceptable. The LDDC has done more for London's development than any other organisation, perhaps for a century. I merely hope that when it winds down and hands on many of its responsibilities to the boroughs, the hon. Gentleman will ensure that those boroughs do half as good a job as the LDDC has done.

    Eutrophication
    Mr. Dalyell: To ask the Secretary of State for the Environment, pursuant to his answer in European Standing Committee A on 12 June at columns 4–6, if he will make a statement on measures to counter eutrophication and algal bloom. [33943]
    Mr. Clappison: Phosphorus removal is being installed at 41 sewage treatment works discharging into 29 designated eutrophic sensitive areas in England and Wales as part of our implementation of the urban waste water treatment directive.
    Mr. Dalyell: What is being done to lessen the environmental and ecological havoc caused by phosphate and nitrogen from fertiliser going into rivers and streams?
    Mr. Clappison: The hon. Gentleman raises a very serious point. He will be aware of the experiences of other parts of Europe, including Germany, with the effects of algal blooms and black spots caused by the types of problems that he has described. Because of those experiences, we are monitoring eutrophic effects in inland waters and in coastal areas. Knowing of the hon. Gentleman's keen interest in this matter, I will keep him informed of the results of that monitoring.

    Asbestos
    Mr. Cohen: To ask the Secretary of State for the Environment if he will provide additional resources to local authorities and housing associations to deal with properties in their possession which contain asbestos. [33945]
    Mr. Curry: It is for local authorities to decide how they allocate their resources.
    Mr. Cohen: My borough of Waltham Forest has suffered enormous housing investment cuts and borrowing restrictions. There is a severe maintenance backlog for council tenants and severe delays for those waiting for improvement grants. Now that asbestos has been found in some tower blocks, the safety of those tenants must come first, but that means that all the other tenants will have to wait that much longer. May I urge the Government to provide special extra funds to councils and to housing associations to deal with asbestos problems?
    Mr. Curry: If the hon. Gentleman really wants improvements in the quality of housing and renovation in his borough, he should recommend to his council that it makes an application under the estates renewal programme. If Tower Hamlets, Hackney, Newham, Lambeth and Brent, among the London boroughs, can do so successfully, I am sure that the hon. Gentleman can encourage his council to do the same. It is all subject to tenants' ballots and everyone will benefit substantially.

    Unitary Authorities
    Mr. Rathbone: To ask the Secretary of State for the Environment what submissions he has recently received about the cost of establishing the new unitary authorities; and if he will make a statement. [33946]
    The Parliamentary Under-Secretary of State for the Environment (Sir Paul Beresford): A system of supplementary credit approvals is being used in response to bids to cover reorganisation costs. However, there are clear opportunities for new unitary authorities to make considerable efficiency savings.
    Mr. Rathbone: Is my hon. Friend aware of the concern of East Sussex county council at the very special costs being incurred by the new unitary authority of Brighton and Hove and the fact that that may lead to a need to increase council taxes within the East Sussex area? Can he reassure people living in East Sussex that that will not be the case?
    Sir Paul Beresford: I can certainly reassure my hon. Friend that we shall be looking at all the bids and bearing his point in mind. I should be very concerned if I had anything to do with East Sussex council as it is at the moment.

  PRIME MINISTER

    Engagements
    Q 1. Mr. Hoyle: To ask the Prime Minister if he will list his official engagements for Tuesday 2 July. [33961]
    The Prime Minister (Mr. John Major): This morning, I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.
    Mr. Hoyle: Will the Prime Minister confirm that the Government's attacks on the Labour party are being scrapped because they were not hurting and not working?
    The Prime Minister: Obviously, our campaign has already worked and already hurt new Labour. I am grateful to the hon. Gentleman for letting me explain precisely why: new taxes on jobs, on Scotland, on parents, on employers, on shareholders; new chaos in schools, in hospitals, on roads; and new weakness in defence and in Europe. That campaign will run and run.
    Sir Anthony Grant: Should the Government not be congratulated on embarking upon the long overdue reform of the legal aid system? Does my right hon. Friend agree

    717
    that it has been widely abused and, too often, used for blackmailing purposes? Does he further agree that it would be disastrous if Britain had litigation on the scale of the United States, where everyone seems to be suing everyone else?
    The Prime Minister: I agree with my hon. Friend on both points. My noble and learned Friend the Lord Chancellor will publish a White Paper setting out the Government's plans to reform the legal aid system in England and Wales. It is right that we should ensure the proper use of money, which is why we believe that legal aid should be directed towards those whose need is greatest. That means stopping weak or undeserving cases being pursued at public expense.
    Mr. Blair: In respect of the sale of Ministry of Defence homes, will the Prime Minister confirm the following facts that have emerged? Not only is the MOD guaranteeing the property developer the full market rent for 25 years: on top of that, if the aggregate rents fall beneath a specified minimum the taxpayer is guaranteed to make up the shortfall for each of the 25 years; on top of that, every year a certain quantity of vacant homes will be made available to the property developer to sell at a profit; and on top of that, the property developer can exchange the sites of MOD homes for comparable sites, without the consent of the tenants. Will the right hon. Gentleman confirm that in each of those four respects my understanding is right and, if so, what is the justification for that extraordinary deal?
    The Prime Minister: The right hon. Gentleman has overlooked the two most salient facts. [Interruption.] All the details will be made plain when the sale is concluded. He has overlooked, first, the extra £100 million released by the sale to provide better homes for the services throughout the United Kingdom and, secondly, the £1.5 billion or thereabouts that will be available to the Exchequer for other resources. He has a lot to say about how he is going to be stringent on public expenditure, but at the first difficult decision he wants to toss away about £1.5 billion.
    Mr. Blair: The Prime Minister says that we should wait until the sale is concluded. With all due respect, I think that we should know the details now. It is precisely the worry about public spending that leads me to put this question. The right hon. Gentleman says that the services will get £100 million, but will he confirm that over the next 25 years there will be a recurring liability to the taxpayer—
    The Prime Minister indicated dissent.
    Mr. Blair: The right hon. Gentleman shakes his head, but he has not disputed a single one of the four points that I put to him. Will he say which of those four points is wrong and, in particular, whether the Government are guaranteeing not just a market rent but that if the aggregate of rents falls beneath the specified minimum the taxpayer will be obliged to make up the shortfall? We should know how much it will cost in future years.
    The Prime Minister: The right hon. Gentleman still does not understand. This is going to yield substantial
    718
    resources for the Exchequer. With the shadow Chancellor sitting next to him, I am surprised that he so lightly tosses £1.5 billion aside. There is no doubt that all he has to say about stringency in public expenditure is for public consumption but will not stand up to the first whiff of controversy when it comes to decisions. We are negotiating a good deal for the taxpayer, now and in the future, and a good deal for the service man—now and in the future—as in due course the right hon. Gentleman will be forced to acknowledge.
    Mr. Blair: With all due respect, the Prime Minister is talking about the amount of money that he will get in this financial year, but we are asking the question because we expect to be dealing with these problems in future years. That is the difference between the short term and the long term, between the Tory party and Labour. Will the Prime Minister say which of those four facts he denies? Is not the truth of the matter that he is attempting to boost the capital sum in this financial year for pre-election purposes while leaving a recurring liability to the taxpayer for years to come for a sale that no service men or women want?
    The Prime Minister: What the right hon. Gentleman has just done is to advance the precise argument against the windfall tax that he himself proposes. Perhaps he will now withdraw the windfall tax, which the shadow Chancellor has spent on three or four occasions already. The right hon. Gentleman still misses the substantive point: it is to provide better accommodation for our service men and that is what it will do, both now and in the future. I am sorry that the right hon. Gentleman does not think that that is a worthwhile proposition.
    Mr. Tredinnick: Will my right hon. Friend congratulate the police on the success of their Euro 96 operation? Does he agree that this showed Europe at its best, acting in harmony and co-operation, and does he think it likely that there will be any plans to prosecute for racial incitement?
    The Prime Minister: I certainly agree with my hon. Friend about the way in which Euro 96 was policed and about the behaviour of the overwhelming majority of people. I had the pleasure of attending the final and of hearing from football administrators across Europe how much they admired the way in which the competition had been run and the behaviour of the crowds at football grounds across the country. I very much hope that this will help us to obtain further such competitions. Prosecutions are, of course, a matter for the police, but I am sure that they will have noted what my hon. Friend said.
    Mr. Ashdown: Further to the Prime Minister's answer to a previous question, does not a large part of the cost of our legal aid come from inefficiencies at all levels in the legal system? Why do the Government not attack those inefficiencies instead of attacking access to justice for ordinary people?
    The Prime Minister: We are trying to ensure that people have proper and equitable access where there is a need for it. As the right hon. Gentleman knows, the

    719
    legal aid system has very few friends at the moment because of the way in which it operates, and it is right that we should examine it in a White Paper and reform it, which is what my noble and learned Friend the Lord Chancellor proposes to do. His plans will ensure better value for money, with the right services going to the right people, and greater fairness between legally aided people and their opponents.
    Mr. Sykes: May I ask the Prime Minister a question about Scotland? He will be well aware that the people of Scotland have much in common with the people of Yorkshire, chiefly in the fact that we will not wantonly part with hard-earned cash. Will my right hon. Friend tell the Opposition that that is why the Scots will never, in a month of Sundays, vote for a tax-raising tartan parliament?
    The Prime Minister: The speed of the Opposition's changes on that policy become more bewildering day by day, so it is not at all clear what their policies will be by the end of this week or the end of next week. What we have seen in the past week or so illustrates clearly the total absurdity of the plans that the Labour party has been preparing for a long time but apparently has not thought about. Labour spokesmen have answered none of the questions asked here or in Scotland about that policy because they have no credible answers to them.
    Mr. Sutcliffe: To ask the Prime Minister if he will list his official engagements for Tuesday 2 July. [33962]
    The Prime Minister: I refer the hon. Member to the answer I gave some moments ago.
    Mr. Sutcliffe: Does the Prime Minister agree with the right hon. Member for South Thanet (Mr. Aitken) that there is a "get Portillo" campaign—a dirty tricks campaign—in the Tory party? Does he not think that such a serious issue—
    Madam Speaker: Order. The hon. Gentleman is asking the Prime Minister about policies for which he is responsible.
    Mr. Sutcliffe: I thought that the Defence Secretary was the responsibility of the Prime Minister.
    Should such a serious issue as homes for the families of service men and women who serve this country so well be used as a political pawn by contenders for the Prime Minister's job?
    The Prime Minister: My right hon. Friend the Secretary of State, like me, is determined to ensure the best possible accommodation for service men, and to ensure that an extra £100 million is available to be spent on them. If the hon. Gentleman is concerned about criticism of one Member against another, I suggest that, after the past few days, he should begin to protect his own leader.
    Mr. Luff: To ask the Prime Minister if he will list his official engagements for Tuesday 2 July. [33963]
    The Prime Minister: I refer my hon. Friend to the answer I gave some moments ago.
    Mr. Luff: Does my right hon. Friend believe that the international influence and unity of the kingdom, the interests of England and the practical needs of his constituents and mine, will be assisted by radical constitutional change? Does he think that it was just a coincidence that, immediately after his strongly argued speech on the constitution, the Opposition's policies collapsed in disarray, posing a multitude of new dangers for our nation?
    The Prime Minister: It is only the beginning of the collapse of those policies; there will be more progressive collapses to come. Whatever U-turns the Opposition continue to perform on their devolution policies, their policies for a devolved, tax-raising parliament in Scotland are bad news for the United Kingdom and bad news for Scotland, and they will prove to be bad news for the Opposition—of that I have no doubt.
    Mr. Hain: To ask the Prime Minister if he will list his official engagements for Tuesday 2 July. [33964]
    The Prime Minister: I refer the hon. Gentleman to the reply I gave some moments ago.
    Mr. Hain: Is the Prime Minister not ashamed of the way his party's £10 million attack on new Labour today stooped to exploiting the blindness of my hon. Friend the Member for Sheffield, Brightside (Mr. Blunkett)? Will he instruct his party chairman to withdraw that disgraceful attack and exploitation and apologise immediately?
    The Prime Minister: No one would conduct such an attack. There are ample policies in new Labour to attack, and those are the policies that we find distasteful and wrong. They are concerned about controls to take rights away from parents, they are producing taxes that they are trying to hide, and they would produce chaos in our public services. Now that we have been able to focus on what the allegedly new Labour party actually stands for, we can identify its dangers and make sure that everyone is aware of them. New Labour and the new dangers will become very apparent to everyone, and it will be the policies that we shall attack, because they are wrong and damaging.
    Mr. Simon Coombs: To ask the Prime Minister if he will list his official engagements for Tuesday 2 July. [33965]
    The Prime Minister: I refer my hon. Friend to the reply I gave some moments ago.
    Mr. Coombs: Will my right hon. Friend confirm that the average family in this country will be £450 a year better off by next April as a result of the tax cuts announced by the Government? Can my right hon. Friend think of any good reason why the average family should trust and risk the Labour party's policies for tax and spend?
    The Prime Minister: I can certainly confirm that growth in the economy and lower taxes mean that the average family will be £450 better off this year, even after taking account of inflation. I can also make it clear to the average
    722
    family that inflation is down, interest rates are down, unemployment is down, investment, exports and production are up and the prospects for individuals as well as for families are brighter than they have been for very many years.

Points of Order
3.30 pm
Mr. Tam Dalyell: On a point of order, Madam Speaker. I was one of the lucky ones, in that my question was reached in Environment questions, but would you pass some comment on the Secretary of State for the Environment's constant habit of flouting the conventions, if not the rules, of the House in turning round to his supporters and ranting at enormous length? Question Time has become rant time, and it simply means that legitimate questions are not reached. What are the rules of the House about Ministers addressing you and the House?
Madam Speaker: I made a statement about those matters in the last couple of weeks, in answer to a point of order raised by the hon. Gentleman himself, so I would refer the House to the response that I made at that time: that I expect all Ministers to answer questions directly, and I expect all Ministers, from the most junior to the most senior Secretary of State, to speak into that microphone and to address me as Speaker of this House. It is through the Speaker of this House that all Members—Ministers and Back Benchers—speak to the House itself. and I expect Ministers to use that microphone to speak to this House through the elected Speaker of this House.
The Secretary of State for the Environment (Mr. John Gummer): Madam Speaker, if inadvertently I have turned my head from you, I am the first to apologise.
Madam Speaker: Thank you. I was referring of course, as the right hon. Gentleman will know, to all Ministers. I notice every day when I am in this Chair how Ministers address this House, and they do not always do so in the courteous way that I expect of them.
Mr. Hugh Dykes: On a point of order, Madam Speaker. Notwithstanding the customary virtuoso performance by my right hon. Friend the Member for Henley (Mr. Heseltine) last Thursday and our own natural sense of bi-weekly fun, did you see the excellent feature in The Independent on Friday, and those in other newspapers, referring to the excessive screaming and shouting at Question Time in the House?
Without us losing that sense of bi-weekly fun, is it possible, both through the usual channels and through your own good offices, to ensure that we have a calmer, more rational Question Time, especially at Prime Minister's Question Time? Without being sanctimonious, this is very important for the public, who I believe are getting increasingly fed up with this and want more accurate questions—and, indeed, accurate ministerial answers.
Madam Speaker: Yes, I certainly would like to see a much calmer Question Time. For a start, when the Prime Minister and the Leader of the Opposition enter the Chamber, hon. Members on both sides should remain respectful and quiet—they should not jeer and shout. Hon. Members could begin by doing that on Thursday.
Mr. Paul Tyler (North Cornwall): On a point of order, Madam Speaker. I have given you notice of my point of order. On 12 June, I tabled questions to the Secretary of State for Northern Ireland, the Secretary of State for Wales, the Secretary of State for Scotland and the Minister of Agriculture, Fisheries and Food relating to the latest information on BSE cases. I received holding answers on 18 June from all four Departments, and I received substantive answers from the Welsh, Scottish and Northern Ireland Offices on 20 June.
I still have not received an answer from the Ministry of Agriculture. However, the Minister issued a press release giving those figures at the royal agricultural show yesterday. Madam Speaker, is it not a grave discourtesy to you and to the House for the Government to govern by press release?
Madam Speaker: I have made a pronouncement on this matter before. I expect Ministers to give the House information first. I cannot verify the figures or what the hon. Gentleman has said, but no doubt Members on the Treasury Bench will have noted his point of order. I suggest to the hon. Gentleman that he continues to pursue this matter with the Ministers concerned.
Mr. George Foulkes: On a point of order, Madam Speaker. My understanding has been that you take points of order at this time of the day. However, you took a point of order from the hon. Member for Ealing, North (Mr. Greenway) during Question Time. Under what circumstances are points of order taken during Question Time? Is it in relation to the conduct of hon. Members during the particular Question Time?
Madam Speaker: No, it is not the conduct of Members; it is the use of foul language. I will always take a point of order immediately if it is drawn to my attention that unacceptable language has been used.
Mr. Matthew Taylor: On a point of order, Madam Speaker. I understand that the Secretary of State for the Environment has announced today that he is taking legal action against South West Water because of the poisoning of some 400 people with cryptosporidium. Have you had any indication that he intends to explain to the House what is happening in this regard?
Madam Speaker: No, I have not been informed that the Secretary of State is seeking to make any such statement.
Mr. David Hanson: On a point of order, Madam Speaker. Could you give me some guidance about the amount of time taken by Ministers to answer ordinary written parliamentary questions? I tabled a question to the Minister of Agriculture on 22 April and I received a reply only yesterday, following a further parliamentary question. I have looked into this matter, and I have found that over half the questions tabled for ordinary written answers to the Minister of Agriculture since 20 March have taken more than one week to answer. Is there any guidance on this matter? I think that a nine-week wait for a written parliamentary answer is an extraordinarily long time.
Madam Speaker: I have a good deal of sympathy with the matter the hon. Gentleman has raised. I will look at the matter and come back to him. If what the hon. Gentleman has told me is correct, it is an inordinate length of time. Ministers appear sometimes to be taking a great deal of time to answer questions.

BILL PRESENTED
  CHARTER TRUSTEES
  Sir Colin Shepherd, supported by Mr. Anthony Coombs, Mr. John Townend, Sir Patrick Cormack and Mr. Robert Key, presented a Bill to provide for the creation in England of parishes in cities and towns where charter trustees have been constituted: And the same was read the First time; and ordered to be read a Second time upon Friday 12 July and to be printed. [Bill 164.]

  Access to Schools (Disabled Persons)
  3.38 pm
  Mr. John Heppell: I beg to move,
  That leave be given to bring in a Bill to ensure the findings of the Access Audits (as laid down in the Education Act 1993) be reported to Parliament; to improve access to schools; and for connected purposes.
  I wish to congratulate some of the people who have made my Bill necessary and possible. I congratulate the National Union of Teachers, and Scope—formerly the Spastics Society. In 1992, it commissioned a study by Coopers and Lybrand into access for disabled children into mainstream education. This resulted in a report which found that the Government had little available information on accessibility, that the local education authorities and the funding agencies, and even schools, had little information. The report recommended that access audits be carried out. When no action was forthcoming in 1993, a second report was produced to emphasise existing need. That report, "The School Survey", investigated the proportion of primary and secondary schools that are accessible to pupils with physical disabilities. It identified the amount of work that was needed to improve disabled access in schools, and it estimated the initial cost of that work.
  The findings presented a bleak picture, but they also drew some reassuring conclusions. The survey found that only 16 per cent. of primary and 7 per cent. of secondary schools were completely accessible. It found that only 18 per cent. of secondary schools were 75 per cent. accessible and that 65 per cent. of primary schools and 55 per cent. of secondary schools had no suitably adapted toilets.
  The survey also showed that three out of four primary schools could provide 75 per cent. access to teaching, including toilet facilities, at an estimated cost of £59 million. It discovered that half of secondary schools could provide 100 per cent. access to teaching, including toilet facilities, at a cost of £251 million.
  Although we are talking about millions of pounds, hon. Members should recognise that they are quite modest sums in the context of the total school spend. The report identified the existing problems in schools, but for the first time it offered a solution. It found that disabled students could achieve access to schools at a fairly modest cost, if a planned programme were set in motion.
  I now wish, rather uncharacteristically, to congratulate the Government. The Government decided to act upon the report, and they amended the Education Act 1993 to allow for access audits of all schools. The Government went still further: partly as a result of the "Within Reach" schools survey, they established an access initiative to enable schools to bid through their local education authorities for money to improve their accessibility. The survey showed that some schools could become accessible for as little as £2,800. I congratulate the Government on taking that initiative.
  Some people will claim that the Government were under pressure from disabled people. They will say that the Disability Discrimination Act 1995 did not go far enough, and that it came too late. Nevertheless, the Government introduced an initiative that has the potential to do an awful lot of good in many schools and help many children with disabilities.

  727
  Access audits have now been conducted, and schools have been allowed to bid for a pot of £10.5 million, comprising Government and partnership money. I am pleased and proud to report that my local authority, Nottinghamshire county council, submitted a bid for £180,000, which was approved. Almost every authority across the country bid for a share of the money.
  However, I am concerned that nothing seems to be happening with the access audits. It is commendable that the audits have been conducted, but they must now be analysed and presented to the House. I am worried that, although the initiative may be working perfectly, we might find that the money could be spent more efficiently within that initiative. We might find that more, or even less, money is needed. I am not asking for additional money at this stage: I am simply saying that we need to know the facts, and to debate in the House the next move forward. The access audit findings that were announced on 21 March showed that 11,694 schools had less than 50 per cent. access to teaching accommodation. Some 68 per cent. of toilet facilities in primary schools and 49 per cent. of toilet facilities in secondary schools were inaccessible.
  The Government's initiative has given us a chance to move forward. We have recognised for a long time that it is a necessity that all children have a good education. The problem is that we have recognised only for the past 25 years that children with special needs have a right to education. Initially, children with special needs were segregated, but Government policy—we had a consensus across the Floor of the House—has recognised since 1981 that, in the vast majority of cases, segregation is damaging not only for children with special needs but for other children.
  When I was a councillor, I tried to get people with disabilities employed on the council; the best way to ensure that the rest of the work force accepted people with disabilities was to employ someone with a disability. The
  728
  best way to do away with discrimination and people's prejudices is to make them face up to their prejudices. 'We have to accept that discrimination still exists in our schools, to the disadvantage of children with disabilities.
  Some 52 per cent. of head teachers claim that their schools are inadequately resourced for special needs, and 42 per cent. of disabled adults have no formal qualifications, compared with 13 per cent. of the population as a whole. Disabled students make up only 0.3 per cent. of the entire student population in universities, although they comprise more than 2 per cent. of the school population.
  Despite legislation to encourage inclusive schooling, the number of children in special schools in 1989 was not even 1 per cent. lower than it was in 1977. That rate of progress would be shameful in any civilised society, but it is even more shameful when the country needs to ensure the best education possible for all our children. Children with disabilities have a right to be included, and I hope that the Bill will go some way towards giving them that right.
  Question put and agreed to.
  Bill ordered to be brought in by Mr. John Heppell, Mr. Harry Cohen, Mr. Robert Ainsworth, Mrs. Bridget Prentice, Mr. Frank Cook, Mr. Jim Cunningham, Mr. Michael Connarty, Mr. Ian Davidson, Mr. Colin Pickthall, Mr. Mike Hall, Mr. Neil Gerrard and Mr. Keith Hill.

  ACCESS TO SCHOOLS (DISABLED PERSONS)
  Mr. John Heppell accordingly presented a Bill to ensure the findings of the Access Audits (as laid down in the Education Act 1993) be reported to Parliament; to improve access to schools; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Thursday 18 July and to be printed. [Bill 165.]
Orders of the Day
  Broadcasting Bill [Lords]
  As amended (in the Standing Committee), further considered.
New clause 18

  EXEMPTIONS FROM TELEVISION LICENCE REQUIREMENT OF CARAVANS AS SECOND HOMES
  '.—(1)Part II of Schedule 2 to the Wireless Telegraphy (Television Licence Fees) regulations 1991 (SI., 1991, No. 436) shall be amended as follows.
  (2) After paragraph 8 there shall be inserted—
  "9.—(1) Any person in possession of a licence to install and use a television receiver at their normal place of residence shall not require an additional licence to install or use a television receiver in a caravan, provided that—

  (a) the licence entitles them to install and use the additional receiver

  (b) the caravan is not used for permanent residential purposes or made available for commercial hire or let.

  (2) In this paragraph "caravan" means any structure designed or adapted for human habitation which is capable of being moved from one place to another (whether by being towed, or being transported on a motor vehicle or trailer) and any motor vehicle so designed or adapted." '.—[Dr. Moonie.]
  Brought up, and read the First time.
  3.48 pm
  Dr. Lewis Moonie: I beg to move, That the clause be read a Second time.
  Mr. Deputy Speaker (Mr. Michael Morris): With this, it will be convenient to discuss new clause 42—Concessionary television licence schemes (sheltered accommodation)—
  '.—(1) Part II of Schedule 2 to the Wireless Telegraphy (Television Licence Fees) Regulation 1991 (S.I., 1991, No. 436) shall be amended as follows.
  (2) In paragraph 1(c), for the words "either lines in one of the dwellings within the group or" shall be omitted.'.
  Dr. Moonie: I shall say at the outset, in case anyone is in any doubt, that I shall not seek to divide the House on new clause 18, which seeks to exempt caravans and mobile homes—used for holidays, not for permanent residential purposes—from the requirement to possess a television licence. New clause 18 would amend the television licensing regulations, and we have tabled it to highlight an anomaly that many hon. Members will have noticed through the contents of their postbags.
  Only in recent months has the BBC, through the licensing authority, been collecting licence fees for caravans and in a number of other areas. At present, only tens of thousands of pounds have been collected from that source, compared with the £1.7 billion from the general licence fee.
  A legal ruling forced the BBC to start collecting that money, although it is obvious from the regulations that every holiday home, even if a television is taken there for only a week, every caravan, every boat, even every lorry driver's cab, has always required a separate licence.
  730
  In Committee, my hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) highlighted an anomaly in the licensing regulations relating to sheltered accommodation. The Minister kindly agreed to table new regulations to rectify the problem. I hope that, in turn, the Minister will agree to consider this matter in some detail.
  It is obvious that second homes that are occupied for much of the year, such as those that hon. Members occupy in London, should be subject to the full licence fee. It is also obvious that commercially let properties should be subject to the full fee. But it may be possible to come up with a scheme for a lower-price supplementary licence in certain cases, or a similar, more pragmatic, arrangement.
  The new clause gives the Minister the opportunity to undertake to review the regulations in general, in order to make them more satisfactory and to tidy them up. I hope that, for everyone's benefit, he will take that opportunity.
  Mrs. Margaret Ewing: I want to comment on new clause 18, but my main remarks will be addressed to new clause 42 in my name.
  As we all know, caravan sites comprise a variety of establishments. I have recently received letters from one in my constituency which consists mainly of static caravans, and I have written to the Department on the issue. Most of those static caravans are used by old-age pensioners. The possibility exists for a rebate on their television licences for the five months during which the caravan site is closed, but that means a substantial amount of administrative work and bureaucracy.
  I wonder what expense such organisations face in ensuring that those who are eligible benefit from that concession. To reclaim such a sum would involve a huge amount of bureaucracy and cost. I hope that the Minister will refer to that.
  New clause 42 relates to sheltered housing, which I understand was debated in Committee. I want to consider some of the anomalies that have resulted from the various regulations on that issue. This is a complex sphere, which must be addressed in order to give people in sheltered accommodation a concession on their television licence fee.
  Having read the papers, I understand that the redefinition of sheltered housing eligible for concessions appears in SI 1988/899, and consolidation regulations were brought into force by SI 1991/436. That meant that a communal facility was not required. The Department of National Heritage is responsible for setting the fees and the content of the regulations.
  The Department of National Heritage and its predecessor have left huge anomalies in the regulations. Since I tabled the new clause, hon. Members from other parties have spoken to me on the subject. Those anomalies are causing much concern, and often anger.
  A sheltered housing complex in my constituency has one warden and one deputy warden, who take equal responsibility for all the residents. There are no communal facilities, but the warden visits all the residents each day, monitors the alarm system and assists with medical appointments. Concessionary television licences are allocated to the residents in one group of houses, but not to those in the other section of the complex, because the warden is resident there. I cannot see the rationale behind that argument, and I ask the House and the Minister to look again at the anomaly.

  731
  Yesterday and today, we have been celebrating the memory of those who lost their lives in the battle of the Somme. The elderly community deserve our support. We have a piecemeal approach to concessionary television licences for sheltered accommodation. The anomalies must be addressed, to eradicate the sense of injustice felt by many of my constituents. I sincerely ask the Minister to take on board the possibility of reviewing all the legislation which applies to the concept of concessionary licences for those who live in sheltered accommodation.
  Mr. Roger Gale: As I represent a constituency with a large number of mobile home parks and touring caravan parks—in common with other hon. Members representing Kent and south coast constituencies—I must express my sympathy with new clause 18.
  Those who take trailer caravans on holiday and park them in the excellent caravan parks in Thanet find it quite incomprehensible that, while they are away—not using the television at home—they should suddenly require a second television licence to use a portable television in the caravan. That applies equally to those using portable televisions in canal boats and other forms of mobile habitation. I very much hope that my hon. Friend the Minister will look sympathetically at the new clause.
  Mr. Joseph Ashton: A couple of years ago, I sat on the Select Committee on National Heritage when it examined in depth the anomalies relating to television licences. As any hon. Member who receives representations on this will know, the system is a shambles from top to bottom.
  Many of my constituents are pensioners. Some are unemployed miners who had to take early retirement. They use some of their redundancy pay to spend the summer on caravan sites at places such as Skegness. They enjoy watching television when they are away, and they continue paying for it when their houses are locked up. Suddenly, out of the blue, they receive a letter saying that they now have to pay again.
  I took up the matter with the BBC licence fee unit. The Select Committee discovered that, since that unit took over from the Home Office about five years ago, it has been much tougher and harder, without achieving much more success—except for sitting ducks such as poor pensioners.
  The letter I received from the licence fee unit referred to
  "a change as a result of legal advice we received".
  Who asked for legal advice? Who demanded that lawyers should look into the matter? The licence fee unit demanded it, in order to take more cash. It was nobody else. The letter states that the licence fee
  "was called into question and we took legal advice."
  Nobody asked the licence fee unit to take legal advice. The House did not ask it to do that. I do not know whether the Minister made such a request. There was certainly no debate in the House. Those people receive a bonus according to what they bring in.
  The letter referred to my constituent Mrs. Perry, who lives in Holderness close, Harworth, South Yorkshire. The local council gives pensioners free bus passes. If pensioners do not want bus passes, they can exchange
  732
  them for the equivalent of a black and white television licence costing about £35 a year. Astonishingly for a niral area, 30 per cent. of pensioners prefer a television licence to a free bus pass. Many of them shop in the village shop. They do not travel long distances on buses, and travel into town only about twice a year at Christmas, so a television licence is extremely useful.
  Anomalies have existed for many years. At one time, big hotels such as the Savoy had one television licence for 400 bedrooms. Very smartly, the Labour Government of 1968 changed that. When I first became a Member of Parliament, we told the then Labour Government that the Savoy hotel should be treated no differently from old people's sheltered accommodation. There is a link, although it may be horizontal rather than vertical. That was how the cheap television licence came into being. Every pensioner in sheltered accommodation with a warden paid a shilling—5p—and the BBC did not like it at all.
  That arrangement was spoilt by a council in Huddersfield, which said that rent collectors were like wardens, and that every pensioner from whom rent was collected was therefore entitled to a cheap television licence. The BBC went to court, and the system was stopped. It has always been the BBC's aggression, rather than the House, that has caused anomalies.
  Our Select Committee then said, in the context of the Savoy hotel, that any hotel with more than 50 bedrooms—it did not want small boarding houses to be included—ought to pay a licence for each television set in each of the extra bedrooms. The licensing unit people would riot have that, however. The law was amended, and the Savoy must now pay a licence for every 15 sets; but if the Savoy can have just one licence for 15 television sets when it charges £150 a night for each room, why the hell cannot pensioners and other hard-up people continue to have their television sets at the seaside? It is time that the Minister looked into what the licensing unit is doing.
  4 pm
  The Select Committee discovered that 40 per cent. of people in Northern Ireland never pay for television licences. They call the licence fee an English tax, and stick two fingers up at the men in the detector vans. The men in the vans are terrified to do anything about it, and avoid certain parts of Belfast because of the problems that there have been in the past. The Committee found that, in the east end of London, 15 per cent. of licence fees had not been collected: owing to the rapid turnover Of bedsitters, with six people living in a house divided into six rooms, no one knew who owned the television set. As the authorities did not know who should be prosecuted, they simply walked away.
  Representatives of the magistrates courts begged the Committee on bended knees to do something about the problem. They were fed up with sending people—mainly women—to gaol. Last year, nearly 800 people were imprisoned for non-payment of licence fees. The magistrates told us that they were not people who would not pay, but people who could not. They did not have the £84. They were single parents, faced with the choice between having their electricity cut off and not paying their television licence fee.
  People do not go to gaol if they do not pay their water, gas or electricity bills; they are disconnected. But if they cannot pay for their television licences, and cannot pay

  733
  the fine, they go to gaol. The magistrates, the Lord Chief Justice and other members of the legal profession have protested about that. People who do not pay may be imprisoned for only seven days, but, if a single mother with three kids goes to gaol for seven days, it costs the local council £2,000 to look after those children.
  The people at the licensing unit receive bonuses related to the amount they collect. That is why women, kids and pensioners are roped in. They do not visit homes at night, when it is dark; they visit them during the day, when it is mainly unemployed people, pensioners and one-parent families who are sitting at home. They are continually chasing revenue with which to enhance their bonuses. They do not bother about the Savoy hotel; no legislation has been introduced to deal with it. This is simply vindictive revenue gathering, in the knowledge that people must pay or go to gaol.
  That is what is wrong with the legislation: it hits the people who cannot afford to pay, rather than catching the people in the big hotels who can. I hope that the Minister will reconsider, and withdraw the measure. If he does so, he will be a very popular man.
  Mr. Kevin Hughes: I support new clause 18. Let me draw the Minister's attention to my early-day motion 972, which seeks to persuade the Government to do something very similar.
  It is always useful for Opposition Members to be able to blame the Government for just about everything. The BBC asked for the new interpretation. If it had not, there would be no change, because the interpretation used to be that, if there was a licence for the main home, there was no need for another one. That is sensible, because no one can simultaneously watch television in his home and in his caravan or holiday home.
  The BBC sought an interpretation, and presumably it got the answer it wanted, which will cost some people a great deal of money. But the interpretation is ludicrous, because, as I have said, people cannot watch two television sets at the same time. I accept that, if part of a family is watching television at home while the other family members are watching another set, they should be required to buy two licences, but it is not fair to ask people to pay twice for one service, and I can think of no other area in which that happens.
  Many thousands of people—including many of my constituents and those of other hon. Members—enjoy their caravans and holiday chalets over the summer, and should not be penalised by having to pay twice for one service. I urge the Minister to accept the sentiments of the early-day motion and the new clause. He should revisit the situation and come up with a reinterpretation, so that people are not penalised in this way.
  Mr. Austin Mitchell: I am grateful to my hon. Friend the Member for Bassetlaw (Mr. Ashton) for putting such good points. The provision has given rise to massive grievance; many hon. Members are getting representations about it from people with caravans, chalets or other such accommodation.
  The BBC has been forced into the situation by the licensing system. The licence fee is not increased by as much as it should be or by the rate that BBC costs are
  734
  increasing, so the BBC is forced to extract the maximum revenue from it, and that leads to bullying. As my hon. Friend the Member for Bassetlaw said, people dare not use such bullying in Northern Ireland, where there is massive unpaid revenue. The process is exercised against the poor, the vulnerable, the old, and those who happen to be at home when the detector van calls.
  I, too, went to see Grimsby magistrates about the sending of people, especially women, to prison. The magistrates do not want to do it: it is a question of unpaid fees. The problem seems to arise because, when the detector vans call, it is often the woman who is at home watching television, while the man may be down at the pub boozing away the licence fee. Therefore, it is the woman who is charged. It is monstrous that, in effect, the BBC has opened a massive grievance to extract its revenue. We should do something about that.
  Our new clause is modest—it is a moderate clause from a moderate party—and covers only caravans that are used for holiday accommodation and are not let. It should also cover chalets and other such accommodation, which I do not know how to describe. There is exotic architecture along the sea front, especially in my area. It is "Costa del Caravan" there.
  In the summer, some people who live in Grimsby migrate two or three miles down the coast to get the better weather in Cleethorpes. They live in caravans or chalets, and they take the television set with them. They do not leave it at home, where it and the video could be stolen. It is not a question of watching one service: there is only one set, and it has to be portable—if it were not, it might be stolen.
  Those people naturally feel a grievance. They are told that they must have two licences, but that they can claim a rebate in each place for the part of the year that they are not in that place. The rebate, however, is not enough to reduce the charge to a fair level, so that is not a satisfactory solution. Our new clause is a sensible way of approaching the matter.
  I also support the proposals in new clause 42, which deals with another long-standing grievance. The matter has been argued over so much. It causes much bitterness that one set of pensioners can get the reduced licence fee and another set cannot. I am amazed that, after all this time, the Government have still done nothing about that grievance, which has been festering. Indeed, they have allowed the BBC to add the other grievance about caravans and chalets, which is dealt with in our new clause. I strongly support both new clauses.
  Ms Angela Eagle: I want to concentrate mainly on new clause 42. Since my election, the grievance about who has the concessionary television licence and who cannot qualify for it has been the one most affecting the elderly population in Wallasey, and the one about which they often write to me. One of the difficulties is its perceived unfairness, which new clause 42 seeks to deal with. It is about time that the Government considered what can be done about it.
  The inconsistency infuriates people. They often live next door to someone in the same circumstances and in sheltered accommodation of the same size. There is no difference, apart from the time when an individual moved in and qualified for the concessionary licence, but there is a large difference in the two payments that those

  735
  neighbours must make. The licence fee is £89.50, which is a significant sum for some of our pensioners on low fixed incomes to have to come up with every year.
  We know that many elderly people rely on television for their entertainment. If they are on a low income, they have few other pleasures. I therefore hope that the Government will take both the new clauses seriously. I know that it is a tangled problem, particularly in relation to sheltered accommodation, but I would be interested if the Government could come up with a way of solving some of the anomalies, and of at least helping neighbours to get on better with each other instead of rowing about one paying the £5 concessionary fee while the other must come up with nearly £100 for the same entertainment and service.
  The problem exists for many of our constituents, and I look forward to hearing what ingenious ways the Government have come up with for dealing with the problem, which has persisted for too long.
  The Minister of State, Department of National Heritage (Mr. Iain Sproat): May I address myself to the hon. Member for Moray (Mrs. Ewing) first? She has explained the purpose of her new clause. In responding, I shall refer to the "warden requirement" as a convenient shorthand for the term in the qualifying criteria for the concessionary television licence scheme:
  "a person whose function is to care for the needs of (the residents)".
  As we understand it, the new clause's intention is to relax the warden requirement in the regulations, so as to bring within the concessionary scheme sheltered accommodation with visiting warden services. I say to the hon. Member for Wallasey (Ms Eagle) that I take the matter extremely seriously. She and the hon. Member for Moray will know what we have done in Committee.
  The Government fully appreciate the importance of television to elderly and disabled people, and understand that those who narrowly fail to qualify for concessionary television licences may feel disappointed. However, having responded to the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) and to my hon. Friend the Member for Worcester (Mr. Luff), in Committee, we changed the circumstance where, in sheltered accommodation, if only one person owned their flat, no one else could get a concessionary licence. That is coming forward.
  As the hon. Member for Wallasey said, it is a tangled matter. I try to go one step at a time. I have solved one problem, which was bitterly felt by many people in Merthyr Tydfil, in Worcester, and no doubt in other places, but we cannot accept new clause 42. I have considered it, as I have considered the other one. I found a solution to the other problem, but I cannot, at this moment at any rate, find a solution to this one.
  Mrs. Ewing: I think that we all appreciate the concession that was granted in Committee. However, the warden in the sheltered housing complex about which I am concerned tells me that her responsibilities are the same for both groups of residents. Therefore, she cannot for the life of her understand why there should be a difference in application of the concessionary licence. Is not that another anomaly that should be looked at? I ask
  736
  the Minister again to undertake a total review of the way in which we deal with concessionary licences for the elderly, disabled and vulnerable in our society.
  Mr. Sproat: I will certainly look at the anomaly in the hon. Lady's constituency, and I will see where that leads me.
  On new clause 18, the Government sympathise with the concern expressed by caravan owners and the tourist industry that a second television licence may be needed for those who wish to watch television in caravans.
  I know that my hon. Friend the Member for North Thanet (Mr. Gale) must have many caravans in his constituency. He has spoken to me about this matter before. In response to what he has said, and in response to the Opposition's amendment, I am glad to say that we will introduce regulations to take account of changes in the use of television in recent years, including those affecting touring caravans and other types of vehicles and vessels. We will aim to do that as soon as possible. In the light of that, I hope that the hon. Member for Kirkcaldy (Dr. Moonie) will withdraw the motion.
  Dr. Moonie: I thank the Minister for his helpful remarks. I beg to ask leave to withdraw the motion.
  Motion and clause, by leave, withdrawn.

New clause 19

  RESTRICTION ON RE-BROADCASTING OF PROGRAMMES FORMING SUBJECT OF FAIRNESS COMPLAINT
  '.—(1) No programme against which the BSC has entertained a fairness complaint shall, without the prior consent of the relevant regulatory body, be repeated in full or in part within the United Kingdom nor included in any service intended for reception outside the United Kingdom until the complaint has been adjudicated upon and the BSC's decision made known to the complainant.
  (2) For the purposes of subsection (1) above, a complaint shall be deemed to have been entertained by the BSC if on a preliminary examination it appears to the BSC to disclose a reasonable case to answer.
  (3) Where the BSC has upheld a fairness complaint in respect of a programme the relevant broadcasting body or, as the case may be, the relevant licence holder, shall not cause the programme to the repeated within the United Kingdom nor permit the inclusion of the programme in any service intended for reception outside the United Kingdom until it has been edited to remove the part or parts of the programme which the BSC has adjudicated to be unfair.'.—[Sir Michael Marshall.]
  Brought up, and read the First time.
  4.15 pm
  Sir Michael Marshall: I beg to move, That the clause be read a Second time.
  Mr. Deputy Speaker: With this, it will be convenient to discuss amendment No. 137, in clause 101, page 91, line 26, at end insert—
  '(2A) It shall be the duty of each broadcasting or regulatory body, when requested by a person or body of persons with reason to believe that their privacy has been, is being, or is about to be infringed in connection with the obtaining of material for a forthcoming programme, to investigate and satisfy themselves that the relevant code in force under subsection (2) above in respect of privacy has been properly applied; and any such request by a person or body of persons shall not prejudice any rights they may have under section 105 of this Act.'.
  Sir Michael Marshall: I believe that it would be more convenient to discuss amendment No. 137 first.

  737
  It is related to clause 101 and covers complaints by aggrieved parties of unjust or unfair treatment or unwarranted infringement of privacy. It is concerned with the role of the broadcasting or regulatory authorities and their relationship with the new Broadcasting Standards Commission, which I shall refer to as the BSC. It is concerned about a situation where complaints are made before a programme has been broadcast. It will become apparent that new clause 19 is about the handling of complaints after transmission.
  I make the point at the outset that the new clause and the amendment have been tabled by my right hon. Friend the Member for North Wiltshire (Mr. Needham) and myself in the light of our experience and that of our constituents in respect of the film entitled "Beyond Reason", which was shown on 20 February 1995. The scale of the problems and the distress caused to our constituents can be judged by the Broadcasting Complaints Commission's subsequent adjudication of 12 October 1995. It said:
  "The Broadcasting Complaints Commission have upheld complaints about the drama, 'Beyond Reason' commissioned by Carlton Television and shown on the ITV network last February. The film tells the story of the killing four years earlier of Penny McAllister. wife of Captain Duncan McAllister, an army officer serving in Northern Ireland. Her throat had been cut by her husband's mistress, Susan Christie, a private soldier in the Ulster Defence Regiment, who was given a sentence of five years—increased to nine on appeal—for manslaughter.
  The BCC found that the film unwarrantably infringed the privacy of Duncan McAllister and his family, and that of Penny McAllister's parents, Mr. and Mrs. Desmond Squire. Both families had repeatedly pleaded with Carlton Television not to go ahead with the film they had commissioned about the tragedy. The Commission found that, although there had earlier been widespread reporting of the tragedy, there was no public interest justification for showing the film, which had been made as a television drama for public entertainment.
  The BCC also found that the programme showed Duncan McAllister as a man far more heartless, selfish and uncaring than could be supported by all the evidence. The portrayal of his seeming callousness when told of Susan Christie's reported pregnancy and miscarriage was particularly unfair.
  Finally, the Commission upheld complaints from Mr. and Mrs. Squire that the film's opening captions did not make it clear to viewers that the programme was made despite their strong objections and without any co-operation from them."
  I have quoted that in full because it is important to understand the thrust of the new clause and the amendment. I should add that the dead girl's parents, Mr. and Mrs. Squire, are my constituents, and that the interests of Mr. Duncan McAllister and his parents were handled by my right hon. Friend the Member for North Wiltshire as their constituency Member of Parliament.
  It may also help to put the matter in context if I refer to the 1994 report of the chairman of the Broadcasting Complaints Commission. I had the opportunity during an Adjournment debate on 8 March 1995, to which my hon. Friend the Minister of State responded, to quote the remarks of the chairman of the BCC—then Canon, now Lord Pilkington—to whose work I pay tribute, as I do to the work of the BCC. In 1994, he said:
  "We continue to be concerned by crime reconstructions particularly when they are based on cases which have occurred in the recent past. We feel it is very important that in the making of such programmes consideration is given to the position of the relatives of the victim."—[Official Report, 8 March 1995: Vol. 256, c. 435.]
  738
  Against that background, I shall explain why my right hon. Friend and I—because of our experience and that of our constituents—suggest that our amendment and new clause are necessary. When we were first approached by the families concerned, a year before the screening of "Beyond Reason", we used every opportunity to persuade the Independent Television Commission, as regulator, and Carlton (UK) Television Ltd., as the company commissioning the film, to give full weight to complaints of unjust and unfair treatment and of invasion of privacy, which we could see that the project represented.
  We stressed in particular the distress caused to our constituents in recreating that tragedy—including the murder in 1991 and the trial in 1992—so soon after the events, and that the outrage and distress were compounded by recreating the dead girl, her parents and Duncan McAllister by look-alike actors. Our appeals were rejected. The ITC said that the project did not breach its current guidelines and codes of practice for drama documentary.
  Carlton relied on public interest and other arguments, which our constituents found totally unacceptable—as, clearly, did the BCC in the adjudication that I quoted.
  That was in the recent past. What is the situation today? My right hon. Friend the Member for North Wiltshire and I have engaged in a long series of discussions and correspondence with the Department of National Heritage, the ITC and the BBC. The significance of all those parties is worth a few words.
  My right hon. Friend the Secretary of State and my hon. Friend the Minister of State have shown considerable sympathy with the case that we have made. Clearly, we have been determined to ensure that, as far as possible, there should be no repetition of the suffering inflicted on our constituents—or on the constituents of any hon. Member.
  On the general principle, we believe that there must be an advance opportunity to influence programme makers to prevent unfairness rather than merely being able to complain about it afterwards. However, the Department of National Heritage seems to be impaled on the hook of protecting the principle of self-regulation.
  I outline the situation as explained by my hon. Friend the Minister of State in a letter to me of 12 June 1996. He wrote:
  "the programme in question led to a number of concerns being raised, even before its broadcast, not just by the Broadcasting Complaints Commission but also by the Independent Television Commission (ITC). I understand that the ITC was, at the time of broadcast, preparing to publish a revised Programme Code, containing new guidelines to be followed in respect of dramatised reconstructions. The ITC had no doubt that 'Beyond Reason' breached those guidelines, but was unable to take action, given that the revised Code was not, at the time, in effect. Nevertheless, the ITC made its views clear to the broadcaster, and made clear its intention to prevent any repeat, as a breach of the new Code, using its powers under the 1990 Act."
  It is not entirely clear whether that means a repeat of the offence or a repeat of the programme, for reasons that I shall mention later.
  My hon. Friend the Minister continued:
  "At the time of publication of its revised Programme Code, the ITC wrote to broadcasters, highlighting the new guidelines and explaining their implications."

  739
  Coming to amendment No. 137, in the terms before us, my hon. Friend the Minister then commented:
  "If I may turn now to … the amendment, my understanding here is that the measures you propose are unnecessary. There is nothing to prevent an individual from approaching a regulator in connection with an allegation that a broadcaster has infringed or is likely to infringe his or her privacy. In such circumstances, the regulator, even without the power of preview or veto, is free to approach the broadcaster or licence holder informally to remind them of their responsibilities under the relevant codes or guidelines. If the broadcaster ultimately ignores this warning, he does so in the knowledge that severe sanctions may result."
  That was the view put forward by my hon. Friend the Minister, which I have discussed with him, as has my right hon. Friend the Member for North Wiltshire. I shall return to the points that he made in a moment, but for the sake of completeness I want to refer to the arguments against the amendment put forward by both the BBC and the ITC, and which clearly have had a strong influence on the Department's thinking.
  I emphasise that it is important to note the problems of principle about which I am arguing, because they are not confined to the ITC. Discussions with the Broadcasting Complaints Commission show that examples of actual and potential problems in this area could affect BBC television and the Radio Authority. I want to concentrate my remarks on television, as the medium about which my right hon. Friend and I have been most concerned during recent months. I shall summarise the reactions of the BBC and the ITC to amendment No. 137, of which they were given advance notice. Perhaps, in these rigorous days, I should declare my interest as a former BBC cricket commentator. The chances of getting such work again in this egalitarian age, with women commentators—something I am sure the hon. Member for Wallasey (Ms Eagle) welcomes—are rather narrow. In passing, I point out that, as a strong proponent of the need to sustain the BBC World Service, I can generally be taken to be a fan and supporter.
  Having said that, I can only describe the BBC's reaction to the proposals in amendment No. 137 as one of, "Auntie knows best." I shall quote from a letter that I received from the BBC's parliamentary liaison officer, dated 21 May 1996:
  "The proposed amendment … would impose an additional burden on the BBC quite separate from the BSC complaints procedure. The question of whether the BBC's Code had been complied with will arise in any event as part of the consideration of the complaint. It is important to remember that the BBC's duty is to 'reflect the general effect of the BSC code as it is relevant to the programmes in question'. The amendment would give complainants an unnecessary and potentially alternative procedure."
  The ITC has consistently shown a greater willingness to address our concerns. Indeed, through correspondence with its chairman last January, it stated that the ITC was ready to accelerate the process of sanctions against those breaking relevant codes. I shall not detain the House with the detail, but that is a welcome assurance. However, the ITC, like the BBC, argues that amendment No. 137 is unnecessary because the procedure is already open to a potentially aggrieved party. In its letter of 28 May, the ITC also expressed fears that to formalise the procedure could lead
  "to a flood of appeals to the ITC, some of which might be self serving and mischievous."
  With that background, I shall now make the case for amendment No. 137. I have tried to give the full flavour of the objections from the BBC and the ITC and of the
  740
  way in which they have been reflected in the preliminary responses of the Department of National Heritage. Let us consider them in turn.
  First, all three parties—the Department, the BBC and the ITC—agree that the procedure outlined in amendment No. 137 is already open to those who wish to complain. Why then discourage its formal incorporation in the Act? Surely the argument that such formalisation would lead to a flood of complaints applies whether the powers are voluntary or statutory. Secondly, experience shows that the viewing and listening public have little or no idea of to whom they can turn. They cannot distinguish between the Broadcasting Standards Council, the regulatory authority, the ITC, the BBC board of governors, the broadcaster, the programme maker and so on.
  4.30 pm
  My right hon. Friend the Member for North Wiltshire and I became involved through handling our constituents' complaints and acting as advocates for them at the hearings of the Broadcasting Complaints Commission. We found the process lengthy and complicated. It was difficult for the ordinary citizen without full administrative support to make any headway. I have little doubt that many people have been deterred in the past.
  On amendment No. 137, I fear that I cannot accept the assertion of my hon. Friend the Minister and the regulatory bodies that such problems cannot recur. There has been some tightening: the ITC recognises that there are circumstances in which it would be difficult to justify programmes such as "Beyond Reason", where the likely distress to the people concerned is greater than the public interest. However, there is no certainty in the matter.
  What about the temptation facing a licence holder whose franchise may not be extended? Is there not a danger of a sensationalist end to the franchise designed to maximise final advertising revenue? As for the BBC, recent experience with the broadcast interview with the Princess of Wales shows that even the board of governors is not necessarily au fait with the corporation's production activity. For those reasons, I cannot understand why there should not be a clear statement in the Bill, which would emphasise the regulator's role in providing some public reassurance. Above all, it would give some hope to aggrieved parties that action may be possible before the damage is done. I commend amendment No. 137.
  New clause 19 logically follows amendment No. 137 in seeking to curtail the apparent disregard of the upholding of fairness complaints. I gave the House an outline of the Broadcasting Complaints Commission's adjudication on "Beyond Reason", which could not have been more damning. But what followed? Within days of the adjudication, the programme was broadcast again in Australia. That raises the question whether the ITC was correct to advise my hon. Friend the Minister that it had exercised its power to prevent repeats. I shall return to that point later, but I ask the House to consider the effect on constituents of yet another round of publicity and correspondence, which added to their distress.
  New clause 19 addresses the prevention of repeats at home and overseas and would give additional teeth to the proposed Broadcasting Standards Commission to remove material that is judged to be offensive from such repeats. I emphasise that new clause 19 has been changed to try

  741
  to take account of what I accept were genuine objections to it. I should outline briefly the actions of the three main parties before I explain how we have amended it.
  The BBC's parliamentary liaison officer wrote:
  "Regrettably the proposed New Clause on Restriction on Re-Broadcasting of Programmes forming subject of complaint treads on essential editorial freedom and independence. The BBC is established and governed by a Royal Charter and Agreement as an independent broadcaster and is not subject to the editorial decisions of any other body. This is a matter of fundamental principle. The integrity and responsibility of BBC programmes are not just well attested.
  The new Royal Charter and Agreement specifically requires that independence. Impartiality and standards of good taste and decency and accountability are also required. No additional regulations are needed to guarantee these principles and practices."
  Does not that fly directly in the face of all the arguments put forward by those who have shown that the BBC cannot automatically count on the form of regulation suggested? Interestingly, no reference is made in those comments to the invasion of privacy. Many may feel that that shows the BBC at its worst, with an apparent declaration ofindependence from any future role of the BSC.
  By contrast, the ITC showed a desire to help. I quote again from the chief executive's letter of 28 May 1996. On the new clause, it said
  "The ITC is entirely sympathetic to the wishes of a legitimate complainant that a programme should not be repeated while the BSC adjudicated on the matter. However, current Broadcasting Complaints Commission processes may take many months and in some cases more than a year to reach adjudication. A mischievous complainant, who took exception to a programme (but had no legitimate grounds to do so) could block its repeat during this period. This clause would therefore have the unintentional side-effect of placing a significant block on broadcasters' legitimate freedoms."
  On restrictions on overseas use, it said:
  "The difficulty with this … is that it assumes that the UK broadcasting body or licence holder will also control secondary rights for overseas use. That is not always the case."
  In both correspondence and meetings, my hon. Friendthe Minister related our original draft new clause to one moved in another place by the noble Baroness Dean, who sought to help us in taking the new clause through the other place. I pay tribute to her work in that regard. However, the proposal was rejected, largely because of the ITC's objections, which I mentioned earlier. In fairness to all concerned, I therefore stress that the new clause moved this afternoon meets the genuine concerns put to us.
  The key element in the new clause is that it is covered by the words:
  "without the prior consent of the relevant regulatory bodies".
  Subsection (2) defines the basis on which the BSC will be deemed to entertain a complaint. With those changes, we have reasserted the principle of self-regulation, by confirming the power of the regulatory body to say yes or no to repeat programming. Thus we also meet the flooding and mischievous complaint concerns.
  I accept that overseas repeats will sometimes be beyond the powers of the regulatory body, but clearly not in all cases. Many broadcasters control both UK and overseas distribution. That sanction should be in place. The moral case must apply to those who seek to beat the system,
  742
  because I assume that they must look to a longer-term relationship with the regulatory authorities, as current and potential licence holders.
  For those reasons, new clause 19 would meet the needs that are plain for all to see. I wish to end on this thought. I have tried to present the arguments of the giants in this field of endeavour—the ITC, a major Department of state and the BBC—dispassionately. But I ask all hon. Members to consider how they and their constituents would feel against the background of an appalling piece of drama documentary such as represented by "Beyond Reason".
  In a spirit of seeking to prevent and deter such suffering, as well as to present a genuinely clearer statement of the options open to aggrieved parties, both before and after the transmission of a television programme, I urge the adoption of the new clause and amendment.
  Mr. Richard Needham: In his usual dispassionate way, my hon. Friend the Member for Arundel (Sir M. Marshall) has put the case against the film "Beyond Reason" and expressed our concerns. They are simply that no such film should be made or shown again. To achieve that, something must happen to ensure that such films do not appear on television.
  This was a disgraceful and disgusting film, which started with the dead wife's blood being shown through rainwater pouring through ferns. The producers of the programme agreed with my hon. Friend's constituent that that was the least that they could do to show how the murder took place, and they took out the scene of the murder.
  It is not as if that film—a faction drama mixing fact and fiction—is unique. There are similar scenes in other documentaries made in this country and elsewhere. It is an absolute abuse of a modern producer's power, and its effects were devastating on those to whom it applied.
  My hon. Friend and I have the single concern that there should be sufficient provisions in the BBC and ITC codes to ensure that that does not happen again. The ITC tells us that, in its view, the new code should ensure that it does not happen again, although I have read the new code and found that some holes remain to be blocked.
  One of the most chilling aspects of the new code is that it says that, in considering whether such a film should be broadcast,
  "Consideration should be given to taking professional advice about the likely effects of the dramatisation. Of particular relevance would be the views of clinical psychologists specializing in this area, or of Victims Support organisations or, with the agreement of the individuals concerned, those counselling them."
  Madam Deputy Speaker, can you imagine the feelings of my constituents and those of my hon. Friend, the parents of the murdered girl and the parents of the husband—who were themselves traumatized—on being told that the decision whether the film should be seen should depend on clinical psychologists and those who counsel them? It is unthinkable that it should be allowed to happen.
  Does the Minister feel that enough is being done? Although my hon. Friend and I accept that the ITC has moved a long way, we are not sure that the BBC has done so. It still appears to believe that the principle of editorial freedom means that such films should not be considered until they have been shown. Amendment No. 137 is a

  743
  belt-and-braces measure, so that those involved have adequate recourse to prevent the film being shown the first time.
  We can clinically and objectively debate the issues and perhaps the remedies, but we should never forget that we are dealing with desperate tragedy. In this case—there have been many similar cases in the past few years—two families were first traumatised by a vicious murder and then further devastated by the ruthless, careless men who were determined to make prurient entertainment by embellishing and exaggerating the horror that befell the families. As a result, the lives of both those families, not least the mothers of the murdered girl and of the husband, have been damaged.
  The House cannot allow innocent families or mothers to be damaged and scarred, perhaps irretrievably, by those who have neither feeling nor understanding. My goodness, how my hon. Friend and I and others spent time trying to persuade the bosses of Carlton, those who were making the film and everyone who was involved that the film should not be shown, but they could not have cared less. As my hon. Friend said, the day after the adjudication by the BCC, it was decided to show the film in Australia.
  In those circumstances, it is hardly surprising that we are dubious about anything that comes before the House which involves self-regulation—shoulds, maybes, mights, coulds and woulds—instead of enabling us to be sure that such a thing cannot happen again.
  We believe that our amendment will achieve that and exactly that. If my hon. Friend does not mind my saying so, it is up to the Minister to prove us wrong.
  Mr. Sproat: My right hon. Friend the Member for North Wiltshire (Mr. Needham) and my hon. Friend the Member for Arundel (Sir M. Marshall) know that I am extremely sympathetic to their concerns. The example of "Beyond Reason", which they cited, was especially shocking, in that the Independent Television Commission had already taken steps to deal with the problem, but the revisions to its code, especially on drama documentaries and faction, came into effect only after the programme was broadcast. The ITC was therefore unable to take action against the broadcaster. It has since, however, made clear the responsibility of its licensees in respect of programmes of this kind.
  4.45 pm
  Although it obviously has an important role to play in such matters, the Broadcasting Standards Commission is not a regulatory body; indeed, its independence from the regulatory framework is essential if it is effectively to perform its functions. New clause 19 would effectively, indirectly, establish the BSC as a regulator, which, by virtue merely of entertaining a complaint, regardless of whether that complaint was ultimately upheld, could prevent a broadcaster repeating the programme in question. However, although the BSC should not have such responsibilities, the ITC should, and does.
  The ITC has the power under the Broadcasting Act 1990 to prevent the broadcaster, or any other licence holder, repeating a programme which it judges to be in breach of its code. The ITC has the powers, including robust sanctions, to enforce compliance. It should use them to ensure—by making crystal clear its views and
  744
  the likelihood of any breach resulting in the most serious sanctions—that never again should there be a case such as that of "Beyond Reason", and certainly no repeat.
  Regarding amendment No. 137, there is at present nothing to prevent an individual approaching a regulator in connection with an allegation that a broadcaster has infringed, or is likely to infringe, his or her privacy. The regulator would then be free to approach the broadcaster informally, reminding it of its responsibilities. Any subsequent breach could be met with severe penalties.
  The Government do not, however, consider it appropriate for the BSC, as opposed to the ITC, to involve itself in such matters. The BSC is concerned with complaints about programmes after they have been broadcast. To play a role before that would, in effect, be to become entangled in the regulatory process. I have already explained why that is undesirable.
  Moreover, although the BSC's code must be reflected in the regulators' own codes and guidelines, it is with the regulators' codes that the broadcaster is obliged to comply.
  The Bill has given additional powers to the BSC, which will have an impact in that area. The code on fairness, which, as I explained, broadcasting and regulatory bodies will be obliged to reflect, will allow the BSC's acquired knowledge and experience to feed into the regulators' own expertise. In addition, the BSC will have the power to commission research into issues relating to unfair treatment and infringement of privacy, which will further add to the understanding of those issues.
  My right hon. Friend the Member for North Wiltshire mentioned the BBC. The new BBC charter and agreement, which came into effect on I May, gives the governors specific responsibilities, equivalent to those of the ITC, to maintain standards, and those, if not fulfilled, could be subject to judicial review. The new chairman, Sir Christopher Bland, has made clear his determination to enforce those obligations. The corporation is also committed to a thorough review of the producers' guidelines, which include detailed advice on matters of privacy and fair treatment.
  I believe that much has been done to prevent further programmes offending in that way, but I fully understand the fear of my right hon. and hon. Friends that that may not be enough. Although the Government do not believe that a legislative solution is called for, I hope that the regulators will take great notice of the concerns expressed today. The Government want never to see again what happened in the case of "Beyond Reason". I hope that, having heard those comments, my right hon. and hon. Friends will not press their new clause and amendment.
  Sir Michael Marshall: I thank my hon. Friend the Minister of State for outlining the present position, and particularly for updating us on the BBC's consideration of those matters. I am sorry that he did not feel able to address the thrust of the arguments that we put forward. If an aggrieved person can raise any such matter with the BBC or the ITC—and they have assured us that they will take such concerns into account—it is a shame that we do not have something in the Bill that reiterates the significance of those activities and alerts members of the public to what is available to them at law.
  I recognise that there are genuine technical difficulties in drafting something that becomes statute law and that meets those situations precisely. I have detected sympathy

  745
  in this regard from hon. Members on both sides of the House. Hon. Members' opinions will go on the record, and I hope that they influence the regulatory authorities when they look at those matters.
  I ask my hon. Friend the Minister to take on board the need to keep the matter under constant review. It is all very well for us to create a fuss, but there is the danger that the issue will slip in a year or two. There is no certainty in such matters. I recognise that my hon. Friend and the regulatory bodies have moved in that regard; we shall do our part and keep an eye on those matters.
  I beg to ask leave to withdraw the motion.
  Motion and clause, by leave, withdrawn.

New clause 20

  USE OF CHILDREN IN TELEVISION ADVERTISEMENTS
  '.—(1) Section 9 of the Broadcasting Act 1990 is amended as follows.
  (2) After subsection (2) there shall be inserted—
  "(2A) The Commission shall take steps to secure that there is included in any code for the time being in force under subsection (1) above a provision prohibiting in any advertisement involving a child the use of voice—over technique or any similar method which has the effect of attributing to that child words or thoughts which, having regard to their sexual or other content, are inappropriate in a child of the age depicted in the advertisement in question.
  (2B) For the purposes of subsection (2A) above a child is a person who has not yet attained ten years of age.
  (2C) "Inappropriate" in subsection (2A) above shall have the meaning assigned to it in guidance to be issued by the Commission as part of the code issued under subsection (1).".'.—[Mr. Tony Banks.]
  Brought up, and read the First time.
  Mr. Tony Banks: I beg to move, That the clause be read a Second time.
  Madam Deputy Speaker (Dame Janet Fookes): With this, it will be convenient to discuss amendment No. 50, in clause 116, page 100, line 36, at end insert—
  '(d) the effects on viewers and listeners of advertising.'.
  Mr. Banks: New clause 20 has arisen because of a series of television advertisements by Safeway supermarkets. I shall explain the advertisements for the benefit of hon. Members who have not seen them—I am not recommending that they should. Two children—Harry and Molly—are used in the advertisement. In real life, the actor Harry is four and the actress Molly is three—if we can call children of that age actors. In the advertisement, they meet in a Safeway creche and, after some dialogue, an actor's voice-over has Harry say, "I suppose a snog's out of the question?" and Molly's voice-over replies, "On a first date? What sort of a girl does he think I am?"
  Some people believe that I am making a fuss and that there are better things for me to get on with—I deny that. Other people have said that the advertisement is cute—which is what I have heard from the advertising agency but, of course, it would say that. I believe that the advertisement is very tacky. After seeing the
  746
  advertisement a couple of times, I spoke to some hon. Members from both sides of the House. I have tabled an early-day motion on the matter.
  Safeway does not give a toss about this because it is simply trying to sell more groceries. If hon. Members look at the terms of early-day motion 911—it is signed by 26 Members of Parliament, from all parties—they will see that there are more serious implications involved in this genre of advertising. For example, if this advertisement had used two adults—and not voice-overs—who met in a Safeway supermarket and the man had said to the woman, "I suppose a snog's out of the question?" and she responded in the way that Molly does, there would have been far more protest. Safeway would have considered that to be vulgar, unacceptable and sexist. It would never have contemplated using such an advertisement and no copy would have been submitted by any advertising agency.
  Why is it that language that would be unacceptable if it came directly out of the mouths of adults is somehow acceptable when it is voiced-over on two children, one aged four and the other aged three? I am not known for being a spoilsport, for being a party pooper or for being particularly prurient. I find this sort of thing offensive and exploitative. What is cute about that sort of language coming out of the mouths of children—or purporting to come out of the mouths of children? Their innocence will be lost soon enough—we do not have to hasten that day in advertisements.
  What we see in this technique is nothing less than cynical and exploitative. The advertisement is not about showing children being cute and sweet; it is about selling groceries—that is the bottom line. The advertisement is not about promoting the welfare of children; it is about selling groceries. I am sure that Safeway can find other ways to do that.
  At one level, such techniques by the advertising agencies play to a silly sentimentality among us all. However, at another level, they run the risk of encouraging those who molest children, who like to convince themselves that children under five have advanced sexual thoughts. That was the fear that I had when I saw the advertisement, but sometimes even I wonder whether I am going over the top. Therefore, I was interested to read an article that backed me up. I refer to an article that appeared in The Independent on Sunday of 26 May that quotes Susan Hope-Borland, a psychologist who has worked with paedophiles for more than 10 years. It states
  "She fears these apparently harmless and amusing scenes will in fact serve to reinforce paedophiles' grossly distorted beliefs about normal childhood behaviour.
  'The implied message in this advert will, unfortunately, fit with the thought processes of many paedophiles,' said Ms Hope-Borland, who works with the North Wales Forensic Psychiatric Service.
  'Paedophiles interpret normal gestures by children as deliberate acts of provocation; they believe that children are sexually aware, and this cognitive distortion is used to justify their behaviour. This kind of advert is certainly not helpful and could be dangerous."'
  They are not my words, but the words of someone who has worked with paedophiles. When we realise just how abhorrent paedophilia is and how disgusted we feel by the actions of such people—indeed, I refer to the Government's recent decision in relation to a register of such people—we have to take this sort of matter seriously. I do not think I am over-reacting on this occasion.

  747
  Safeway's advertisement agency, Bates Dorland, naturally denied such a claim—of course, it would. Mr. Adam Leigh, the account director, has said how few complaints the agency has received about the advertisement—in fact, it received more complaints when, in an earlier ad, Harry said that he did not believe in Father Christmas. Mr. Leigh even had the temerity—it was insulting—to suggest that such criticisms reflect more on the accusers than on the advertising agency. It might be that Mr. Leigh does not have much of a conscience, but if he cannot accept that there could be dangers as a result of the advertisement, he is as witless as he is exploitative of children.
  I have looked at the ITC code to see whether the advertisements could fall foul of the code in relation to the use of children. Paragraph 13 of the code states:
  "Advertisements must not portray children in a sexually provocative manner."
  Of course, the loophole is that adults are used to put sexual innuendo into the dialogue—it does not come directly out of the mouths of the children. The agency is able to get around the ITC's code by using this technique. The loophole must be closed.
  I know that there is sympathy for my new clause. I hope that the Minister will be helpful in his reply. On this occasion, I feel that I am reflecting the views of many hon. Members—this is not just an over-reaction on my part. I have identified a serious matter. I am sure that the Minister will take it seriously.
  Mr. Cynog Dans: I wish to address amendment No. 50—which is grouped with new clause 20—which touches on a similar area of concern. The hon. Member for Newham, North-West (Mr. Banks) has referred to the protection of children, which is a large part of my motivation in tabling amendment No. 50. I also tabled a number of other amendments which were not selected. I believe that the competence of the Broadcasting Standards Commission should be extended to include advertising. I would like to see the BSC empowered to adjudicate on complaints about advertising and other related matters. However, the amendment simply gives the BSC the power and the responsibility to conduct research into the effects of advertising on listeners and viewers.
  I do not want to get into a debate about whether the BSC should exist or to start a competition between the BSC and the Independent Television Commission. The reality is that the BSC exists and, as its job is to deal with broadcasting standards, I believe that it should also address the question of television advertising standards. After all, advertising is as much a part of television as the programmes and advertising standards are of equal concern. People should be able to complain about advertisements to the body that is responsible for monitoring broadcasting standards.
  As the hon. Member for Newham, North-West emphasised, advertising is enormously influential—and not just in relation to which brand of product a purchaser selects. Advertising affects whether a product is purchased and in what quantities it is consumed by individuals and by society. It is important to emphasise that most advertising is not concerned with providing information, giving details about the product, or with explaining—by rational and evidential means—the virtues of a particular brand over other brands.
  748
  5 pm
  Advertising is essentially manipulative: it employs great creativity for decadent purposes. It works by establishing associations with ideas. It encourages fantasy and it appeals to a sense of status, emphasising ownership as a status symbol. It appeals to hedonism and many advertisements have eroticism at their heart. On the whole, advertising is a means of encouraging increased consumption: it is the linchpin of consumerism and the consumerist economy.
  I am particularly concerned about the effect of advertising on children. It is not difficult to argue that the manipulation of children for commercial exploitation is offensive. I believe that, by encouraging consumerism among children, we may be creating significant problems for the future. Sustainability will require husbanding the world's resources rather than squandering them. One hopes that thrift, rather than profligacy, will become a virtue in the future.
  Appendix 1 of the 1995 ITC code recognises the impact of advertising on children by prohibiting the advertising of certain products. For example, it prohibits the advertising of alcoholic drinks, liqueur chocolates, matches, medicines, vitamins and certain films before the 9 o'clock threshold. The code states:
  "Advertisements must not exhort children to purchase or to ask their parents or others to make enquiries or purchases."
  Rule No. 7 states:
  "No advertisement may lead children to believe that if they do not have or use the product or service advertised they will be inferior in some way to other children or liable to be held in contempt or ridicule."
  If one applied those rules literally, one would find that most advertising complied with them. In reality, parents know the pressure that their children place upon them as a result of the influence of advertising. It is clear that much advertising has the very effect on children that the advertising code aims to prevent.
  Advertising should be rigorously examined and researched—that is what the amendment calls for. I would particularly like to see that principle applied to advertising that encourages children to consume unhealthy food. I am sure that the Secretary of State, who announced the Government's policy on healthy eating, would welcome that move. It has been suggested that the code should prohibit advertising that encourages excessive consumption of fatty and sugary foods by children.
  The National Food Alliance has expressed considerable concern about that matter and its research has confirmed many of our fears. It found that children's diets are too high in fat, sugar and salt and too low in fibre. It found also that advertising on children's television is dominated by commercials for sweet and/or fatty foods and that advertising can have a powerful effect on children's behaviour, specifically in relation to food and drink. That is a clear recognition of the power of advertising and its influence on children's behaviour. That is a serious matter.
  Mrs. Anne Campbell: Does the hon. Gentleman agree that, apart from advertising, a major influence on children's diets is the composition of school

  749
  meals? Does he agree also that reintroducing regulations on the contents of school meals would do a great deal to improve children's diets?
  Mr. Dafis: I agree strongly, but I suggest that we are straying wide of the subject for debate. As a schoolteacher, I remember being horrified when children in the dinner queue were presented with trayfuls of sweets. I thought that that was a thoroughly bad practice.
  However, today I am concerned about advertising. Encouraging unhealthy eating is a serious problem. The National Food Alliance points out that 25 per cent. of British women—it does not comment about men—will be obese by 2005. It suggests a number of amendments to the ITC code. I would like those amendments to be examined as part of the research that the BSC should carry out in relation to the influence of advertising on the public, and specifically on children.
  The National Food Alliance recommendations are supported by an impressive array of more than 50 organisations, including the Association of Community Health Councils for England and Wales, the British Dietetic Association, the Institute of Environmental Health Officers, the Low Pay Unit, the National Farmers Union and the British Heart Foundation. The recommendations were published in July 1994, but they were not taken on board in the ITC code that was published in autumn 1995. The issue of food advertising is only one reason for tabling the amendment. I believe that there are plenty more reasons and that the amendment deserves serious consideration.
  Mr. Sproat: I turn first to the speech by the hon. Member for Newham, North-West (Mr. Banks). I understand his concerns about the potential exploitation of children in advertising and I know that the Safeway case that he cited disgusted many people. Both the Independent Television Commission and the Broadcasting Standards Council received several complaints that the advertisement portrayed children in an inappropriate manner. The BSC has yet to deliver its findings on the complaints, but apparently the ITC did not find that the tone of the advertisement was sexually provocative or likely to encourage paedophilia. However, as I understand it, that was not the hon. Gentleman's charge: he objected to the advertisement's portrayal of children in a sexual situation. I hope that the ITC will view the hon. Gentleman's speech in that light and I shall certainly bring that point to its attention.
  I agree that advertising must not sexualise children. The ITC code of advertising standards and practice contains the clear direction that
  "Advertisements must not portray children in a sexually provocative manner."
  That is not the hon. Gentleman's claim—he would complain if the advertisement did that. He is complaining that the advertisement associates children with a sexual encounter between adults and that that is offensive. It is open to the ITC to strengthen its code in light of its own experiences and concerns and that of others, and it may now wish to do so. However, I do not believe that the example cited by the hon. Gentleman represents a trend in advertising that merits a specific legislative measure of this kind. I certainly hope that no such trend develops.
  750
  As I have said, I share the deep unease of the hon. Member for Newham, North-West about what took place and I shall draw his remarks, which echo the opinions of many hon. Members and others, firmly and specifically to the ITC's attention. Following that reassurance, I hope that the hon. Member will withdraw new clause 20.
  I shall turn now to amendment No. 50. Section 12(1)(a) of the Broadcasting Act 1990 places a specific responsibility on the ITC to carry out or commission research into the effects of programmes, including advertisements. The Broadcasting Standards Commission may also, under the Bill, commission research into the effects of advertising to the extent that the research relates to matters falling within its remit, including issues of standards, fairness or privacy. The Government do not however feel that it would be appropriate to extend that power to cover issues relating to the effects of advertising generally. I hope, therefore, that in the light of that explanation the hon. Member for Ceredigion and Pembroke, North (Mr. Dafis) will not press amendment No. 50.
  Mr. Tony Banks: I thank the Minister for what he has said. I know that he takes this matter seriously, as I do. I consider new clause 20 to be a shot across the bows of the advertising agency and the advertiser. A trend has not yet developed and I hope that, after our short debate and after the Minister has acted as he has undertaken to do, we will not see any such trend. I shall personally continue to monitor the situation, as will others. Under the circumstances and with the assurances that I have been given, I beg to ask leave to withdraw the motion.
  Motion and clause, by leave, withdrawn.

New clause 22

  MATTERS RELATING TO CONDITIONAL ACCESS SYSTEMS
  '.—(1) Any person who operates a conditional access system shall be required to first obtain from the Commission a licence for the operating of such a system.
  (2) The Commission may after consultation with the Director grant a licence for the operating of a conditional access system.
  (3) A licence granted under this section shall be in writing and shall continue in force for such period as may be specified in or determined by or under the licence.
  (4) A licence granted under this section shall include conditions requiring—

  (a) payment to the Commission on the grant of the licence or payments during the currency of the licence (or both) as may be determined by or under the licence;

  (b) any person who is authorised by the licence to operate a conditional access system to furnish to the Commission, in such manner and at such times as they may reasonably require, such documents, accounts, forecasts, returns or other information as they may reasonably require;

  (c) compliance with any direction given by the Commission as to such matters as are specified in the licence or are of a description so specified;

  (d) determination by the Commission of such questions arising under the licence as are specified in the licence or are of a description so specified;

  (e) any person who is authorised by the licence to operate a conditional access system to provide services to all relevant television programme service provides without undue preference or discrimination; and

  751

  (f) compliance with such further conditions as appear to the Commission to be requisite or expedient having regard to the duties imposed on them by subsection (7) below.

  (5) Subsection 4(e) shall not apply to the holder of a licence under Section 72 of the 1990 Act to provide local delivery services.
  (6) Any sums received by the Commission under this section shall be paid into the Consolidated Fund.
  (7) It shall be the duty of the Commission to exercise their functions in the grant of licences hereunder in the manner which they consider is best calculated:

  (a) to ensure fair and effective competition between persons engaged in the provision of conditional access systems;

  (b) to promote the interests of consumers, purchasers and other users in the United Kingdom of conditional access systems and to ensure that access to such systems are fair and reasonable.

  (8) The holding by any person of a licence authorising the provision of a conditional access system shall not relieve him of any requirement to hold a licence under section 7 of the Telecommunications Act 1984 in connection with the provision of such a system.
  (9) Any person who operates a conditional access system within the United Kingdom shall be guilty of an offence unless he is authorised to operate such a system by licence granted hereunder.
  (10) A person guilty of an offence under this section shall be liable:

  (a) on summary conviction to a fine not exceeding the statutory maximum:

  (b) on conviction on indictment, to a fine.

  (11) No proceeding in respect of an offence under this section shall be instituted except by or on behalf of the Commission.
  (12) Without prejudice to subsection (9) compliance with this section shall be enforceable by civil proceedings for an injunction or interdict or other appropriate relief.'.—[Dr. Moonie.]
  Brought up, and read the First time.
  Motion made, and Question proposed, That the clause be read a Second time.—[Dr. Moonie.]
  Madam Deputy Speaker: With this, it will be convenient to discuss the following: New clause 47—Licensing of conditional access technology—
  'After section 45 of the 1990 Act there shall be inserted the following section:—
  "45B (1) It shall be the duty of the relevant authority to ensure that any person operating a conditional access system for the digital transmission of a domestic or non domestic satellite service, or any digital terrestrial service for general reception

  (a) declares in advance of operating the conditional access system the type of system to be used, and

  (b) offers to licence, or as the case may be, sub-licence, the industrial and intellectual property rights to all manufacturers and broadcasters on fair, reasonable, and non-discriminatory terms.

  (2) In this section the "intellectual and industrial property rights" means those rights allowing for:

  (a) the manufacture of a decoding box which is capable of decoding entitlement management information transmitted with that service, and

  (b) the broadcast of encrypted television signals and entitlement management information by other broadcasters using that system.

  (3) In this section 'the relevant authority' means the Director General of Telecommunications.".'.
  Amendment No. 127, in clause 35, page 29, line 44, at end insert—
  '"Conditional access system" means any telecommunications systems or telecommunications apparatus designed or adapted for the origination, initial transmission and final reception of signals for the actuation, operation or control from another place of other telecommunications apparatus by means of which signals comprising encrypted television programme services in either analogue or digital form (or any combination thereof) are broadcast or transmitted for general reception and received and decrypted.'.
  Amendment No. 128, in page 30, line 3, at end insert—
  "Director" means the Director General of Tele-communications.'.
  Mr. Robert Maclennan: We dealt with issues cognate to new clause 47 yesterday and it deals with the licensing of conditional access technology—the technology used at the receiving end in a set-top box. Some of the issues that we considered yesterday do not bear repeating, but because new clause 47 deals with a matter of great concern, especially for the consumer organisations, it is right to raise the issue explicitly again.
  New clause 47 has the support of the ITC, the BBC, the Voice of the Listener and Viewer, the National Consumer Council and the Consumers Association. In Committee, the Minister recognised that the issue was perhaps the most serious and important of the Bill. I do not seek, through the new clause, to mandate a single conditional access system. It would provide that the operators of conditional access systems would have an obligation to license the key industrial and intellectual property on fair and reasonable terms so that other manufacturers could produce a dual-capable box that could access signals from both digital-terrestrial and digital-satellite transmissions. Proprietary systems would still emerge and their operators would be free to place them on the market—and even to subsidise them heavily, as seems likely—but consumers would still have the option to buy in the high street a box that includes the key technology needed to access the full range of digital services.
  5.15 pm
  It has been suggested that licensing would be expropriatory in some way. I fail to understand how that charge can be made because new clause 47 provides that the licensing would take place on fair and reasonable terms or, in other words, on payment of a fee.
  We cannot delay on this issue because we would hold up the development of digital television and sap consumer confidence. We should move clearly and quickly to take account of the problem. New clause 47 would simply remove a barrier to the operation of the market and, if one system is successful, ensure that service operators cannot be prevented from adopting that system.
  The Minister for Science and Technology (Mr. Ian Taylor): Some of the elements of new clauses 22 and 47 were touched on last night and, therefore, I too will refrain from going through the detail again. I realise that the House wants to make swift progress.
  New clause 22 would extend the conditional access regulations to analogue transmissions. In my judgment, that would not be a wise move. The analogue market is

  753
  likely to be constrained by the availability of transponder capacity and the market will probably decline as the push to digital happens. There will be an incentive to be first in the market and the new clause would, therefore, not be appropriate on technical grounds. It would also be inappropriate on market grounds. A stable series of investments were made in the analogue market under a particular regulatory environment and it would not be sensible to change that regulatory environment simply because the Bill provides a legislative platform. Any changes would not engender confidence in long-term investments by market players, who have a right to expect a proper return. The difference in conditional access in the digital market is that the whole market will require the conditional access systems. In the analogue market, the systems are principally required by those broadcasting via satellite.
  New clause 22 would also switch the conditional licensing system to the ITC whereas our proposals will hand it to the Office of Telecommunications under the Telecommunications Act 1984. Licences under that Act will be required in any event by people using conditional access systems. We do not believe in double jeopardy and, in our judgment, Oftel is the appropriate authority because it is used to dealing with detailed economic regulations. Telecommunications lines will also often be one of the means of broadcasting. The Government will therefore resist new clause 22.
  The hon. Member for Caithness and Sutherland (Mr. Maclennan) mentioned new clause 47. I dealt with some of the issues last night, but I understand the hon. Gentleman's motivation. We want to create certainty in the market and we do not want problems between different systems. The mandatory licensing of all conditional access technology appears, on the surface, to be attractive. However, as I explained to the House last night, the European directive and our regulations would meet the problems that most concern the hon. Gentleman. Broadcasters will be able to interconnect with conditional access systems under our proposals through the use of simul-crypt. The Bill will link the technology to interconnection rather than introduce further licensing conditions which would be more likely to create delay. I hope that the hon. Gentleman will withdraw his new clause.
  Mr. Maclennan: I do not want to delay the House, but I would be grateful if the Minister would explain how his system would prevent the emergence of a single powerful player and the consequent limited choice and constantly increasing prices for the consumer. How will the technology stop that?
  Mr. Taylor: The technology comes within the context of the overall competitive regulatory environment, as I explained to the House yesterday and is also made clear in the regulations that I tabled on 26 June. The framework of competition law obliges fair access for all broadcasters to the systems and the regulatory and competition authorities can take certain steps. That clear framework will enable us to encourage the necessary private sector investment to come into the market. The technical prospects behind the process of simul-crypting will enable the transmission signal to
  754
  contain a series of instructions that will enable the decoder to react to the different broadcasters. Therefore, through simul-crypt, the technology enables the operation to work, and the regulatory framework of competition law means that no one can resist the application of a broadcaster to send a transmission signal. That is a sufficient framework.
  We are talking about a system for the future into which, as of this date, no one has put any money. My hon. Friend the Minister of State has spent hours in Committee attempting to get the framework right. The Bill is designed to provide a clear and solid framework so that people are encouraged to come forward with proposals for investing risk capital in the industry.
  Mrs. Anne Campbell: The market solution which the Government are proposing led, with the introduction of video recorders, to competition between Betamax and VHS. I was one of the unfortunates who bought Betamax, believing it to be a superior technical solution, but, in the end, I had to throw it away because I could not get the videos to play on it. Will a similar situation arise in this case? Shall I buy a set-top box only to find that I shall have to throw it away after six months because I cannot use it?
  Mr. Taylor: That is the first time in the House that the hon. Lady has, to my knowledge, admitted making a technological error. There is a first even at this stage of the Bill.
  Manufacturers and other parties in the industry are well aware of the Betamax problem. That is why standards committees work constantly to ensure that such mistakes do not occur. Ultimately, a commercial judgment has to be made in the marketplace. It is not for me to tell any company that it should not try to go down a particular avenue if it believes that that will give a reward. If it has a dominant market position and abuses it, the competition regulations will come into force. That is the right way to proceed. Otherwise the Government will have to put up the risk capital. I am sure that the hon. Lady would not find much favour from the shadow Chancellor if she were to propose that.
  The simple reality is that no one has as yet put the money on the table to enable us to make the transfer to digital satellite or digital terrestrial television. The Bill must encourage private sector investment as much as possible. Any ill thought through regulations, or any attempt to be over-prescriptive, is likely to have a counteractive effect.
  Our proposals use a competition framework and then we have found a way, through technology, to stimulate convergence.
  Ms Eagle rose—
  Mr. Taylor: I am under great pressure, not least from those on the Opposition Front Bench, to make progress, so I shall not take any further interventions. I look to the hon. Member for Kirkcaldy (Dr. Moonie) to withdraw the new clause.
  Dr. Moonie: I beg to ask leave to withdraw the motion.
  Motion and clause, by leave, withdrawn.

New clause 24

  APPLICATION OF RESTRICTIVE TRADE PRACTICES ACT 1976 TO SALE OR TRANSFER OF BROADCASTING RIGHTS FOR SPORTS EVENTS
  '.—(1) Any agreement to which this section applies shall be an excepted agreement for the purposes of Schedule 3 to the Restrictive Trade Practices Act 1976.
  (2) This section shall apply to any agreement by or among persons engaging in or conducting the professional team sport of association football, or any other professional sport which the Secretary of State may separately by regulations prescribe, by which any constituent league or other body in that sport sells or otherwise transfers all or any part of the rights of that league's participants in respect of the broadcasting of games engaged in or conducted by those clubs in events organised by such a league or other body.
  (3) The power to make regulations under this section shall be exercised by statutory instrument and a statutory instrument containing any such regulations shall be subject to annulment in pursuance of a resolution of either House of Parliament'.— [Mr. Mellor.]
  Brought up, and read the First time.
  Mr. David Mellor: I beg to move, That the clause be read a Second time.
  Madam Deputy Speaker: With this, it will be convenient to discuss amendment No. 146, in schedule 7, page 155, line 3, at end insert—'Restrictive Trade Practices Act 1976—
  24A. In Schedule 3 of the Restrictive Trade Practices Act 1976 there shall at the end be inserted—
  "Agreements for broadcasting of association football or other prescribed sports
  10. This Act does not apply to an agreement falling within section (Application of Restrictive Trade Practices Act 1976 to sale or transfer of broadcasting rights for sports events)of the Broadcasting Act 1996".'.
  Mr. Mellor: I, too, do not wish to detain the House too long, so I shall be brief. I do want to say, however—I hope without any self-aggrandisement—that brief though my contribution and the debate may be, it raises an issue of fundamental importance to the coverage of televised sport in Britain. I am strengthened in that belief by the fact that one of the attractive features of our debates on broadcasting is that it is possible for us to set to one side the narrow partisanship that has figured in so many debates in this place and to talk together as sensible, reasonable adults, sharing our interests and experience of the world.
  Many hon. Members present today are deeply committed to sport. I am proud, therefore, that my co-sponsor of the new clause should be the hon. Member for Kirkcaldy (Dr. Moonie), and to see others in their place, such as the hon. Member for Bassetlaw (Mr. Ashton), a director of Sheffield Wednesday, who understands from his own practical experience of football in just what a curious situation we find ourselves, with the threat of what I regard—I speak without any exaggeration from 11 years' experience as a Minister and nearly 20 years in the House—as the most foolish intervention by a regulator that I have ever encountered.
  That intervention is the decision of the Director General of Fair Trading to refer the right of Britain's Premier league collectively to sell its television rights to a
  756
  television station. That has nothing to do with the merils of Sky against the BBC or ITV; it is to do with the fundamental right of sports organisations to band together in a league to sell their product collectively as the only way of making sense of the ability to televise, for the enjoyment of a wider public, the games that they play.
  We have a situation that Alice in Wonderland would have difficulty embracing. Lewis Carroll at his most fanciful could not have imagined the situation that rosea in last night's debate on sports rights, in which my hon. Friend the Minister of State properly said that the basic principle must be that sporting bodies have a right to sell their broadcasting rights to whomsoever they choose.
  We have chosen—I approve of this—to trench on that right by having the crown jewels of sport. I warmly endorse, and was one of those who worked for, the further changes that are now part of the Bill. But how can the sincere and proper words of my hon. Friend the Minister of State sit with the ludicrous situation of a regulator, who is part of the Government machine, condemning the Premier league for doing precisely that?
  Again, this is a moment that Lewis Carroll would appreciate. At the same time as politicians are condemning the Rugby Union for doing exactly what the Director General of Fair Trading wants, the director general is trying to translate the chaos that currently exists in international rugby union into the world of football.
  What is the nub of the point that lay behind all the condemnatory words that were said yesterday about the Rugby Football Union? It is that the English Rugby Football Union has chosen to break away from the other four and to sell its television rights. It has said, "To hell with the rest of you; we are having our own deal." The response to that will be, "In that case, you don't play in our league." There is then chaos, confusion and anarchy.
  In order to prevent that in Britain, for years now, long before the formation of the Premier league, the Football League had the right, and the Premier league asserts the right, to say, "Here is our fixture list. These are available for television transmission and we have the right to sell fixtures collectively." It is not as though it is a cartel. Teams remain at the top not because they choose to do so but because their results entitle them to do so. Over several years, the membership of the league changes, so it is not a cartel.
  Here we have a curious situation. In the United States, under anti-trust laws, American regulatory authorities are restricted from taking nominated sporting leagues to task for selling their product as an entire package. Everyone knows that unless that happens, chaos and confusion will be the inevitable result.
  If Manchester United has its own television contract and Chelsea has another, how on earth will fixtures between Chelsea and Manchester be managed if one says that its television contract gives its company the right to transmit a service and the other says to the contrary? That would be ludicrous. I cannot imagine how even some pointy-headed quasi-intellectual in the Office of Fair Trading could seriously believe that that lies within the world of practical reality.
  The tragedy is that that threatens football's future just: at a time when a situation for which we have all prayed has begun to happen: football has at long last managed to win through, to get resources flowing into the game and. to bring in on the back of those resources international

  757
  players so that, for the first time in the experience of football spectators, great players from the continent are playing in our league rather than avoiding it like the plague. We are net importers of players, not net exporters. Every club benefits.
  Last season, the distribution of the spoils from television coverage showed that although Newcastle walked off with just over £3 million and Manchester United with just under £3 million, the relegated clubs did well too—Queen's Park Rangers received £1.3 million and Bolton Wanderers received £1.2 million.
  In selling the product as an entire package, the Premier league insists, first, that a highlights package is available on BBC—it is one of the most popular weekend programmes—and, secondly, that those who win the right to show live matches must show a minimum of three games featuring each team in the league. Otherwise, only the most fashionable clubs would have a television contract and the rest would have nothing, making it impossible to spread resources sensibly through the game.
  I shall not detain the House long as the facts speak for themselves, but I should like to make a couple of points in conclusion. First, I hope that the restrictive trade practices court will reject the proposal with contumely. Every time lawyers are dragged into the matter, there are expenses. I know that I am a devil denouncing sin, but from practical experience of sin I should say that the Premier league confidently anticipates that it will have to spend some £2 million to £3 million on legal advice even if the proposal is rejected.
  5.30 pm
  I am glad that hon. Friend the Minister for Science and Technology, for whom I have the highest regard, has returned to his place. Events of the past few weeks have shown that the world of football is not to be trifled with; it commands a good deal more support than many Government Departments, whoever manages them. The suspicion remains that if the Department of Trade and Industry had taken a firmer line with the Office of Fair Trading this nonsense may have been avoided.
  When the Department of Trade and Industry presented a public face in the world of football, the special adviser charged with meeting representatives of the Premier league sounded like a crazed ideologue even beyond my understanding of the furthest, most exotic fringes of the right wing of the Conservative party. Such people should be suppressed. They simply reduce confidence in the Government at a time when confidence should not be further diminished, at least in the interests of Conservative Members.
  The Department of Trade and Industry should have stamped on all this nonsense. It is absolutely clear that if that nonsense had the force of law it would totally destroy our great national game and the pleasure that millions of people derive from it. I wish to give my hon. Friend the Minister of State, Department of National Heritage—a Department whose understanding of broadcasting may be more profound than that which prevails in the Department of Trade and Industry—the opportunity to say what the Government really think about it. That is why I took the liberty of proposing the new clause today.
  Mr. Ashton: The right hon. and learned Member for Putney (Mr. Mellor) made an excellent speech. I should
  758
  like to support him in slightly more detail, although I shall not detain the House long. I should declare an interest as a director of Sheffield Wednesday, although that job is unremunerated. Nevertheless, the club has an interest in these matters.
  The Sky package deal that ends next season is fairly clear. Sky shows 60 games a year, which guarantees that at least three and probably four games of each club are televised. Under the old system operated by the BBC and the ITV companies, many first division clubs such as Sheffield United or Oldham never appeared on television. Now, each club is guaranteed a fixed number of games, even if they are shown on a Sunday or a Monday. Cash is paid for each place in the league, so that the bottom club gets £50,000, the next one gets £100,000 and so on. Obviously, clubs at the top of the league such as Manchester United and Newcastle make a great deal more money than others, but that is acceptable to every member of the league.
  Some of the cash that has been negotiated under the new deal will be spent on coaching. Local Football Association bodies have been told that someone who cannot afford Sky can at least see the BBC highlights on Saturday night. Clubs receive a relatively small fee for that. My right hon. Friend the Member for Copeland (Dr. Cunningham) and I watched Sheffield Wednesday play Newcastle. The game was shown on "Match of the Day" for 25 minutes, yet each club received only £7,000. The BBC paid £1 million a hour for "Pride and Prejudice", which had a far smaller television audience, so the value for money that football provides for sports fans and for the BBC is absolutely clear. It is an excellent scheme that has worked well for three or four years.
  Now, however, the cable operators have had a different idea. Instead of negotiating a package deal with Sky, they want to negotiate separate deals with individual clubs. Obviously, the deal that they will negotiate with Manchester United or Newcastle will be far more valuable than the deal with Sheffield Wednesday or Wimbledon, but what will happen when two differently ranked teams play each other? The cable operators will not explain the position, but there will obviously be chaos. It will not work out.
  To the astonishment of everybody, the then Director General of Fair Trading, Sir Bryan Carsberg, who was about to retire, objected to the Sky deal. Everyone thought that it was one of his enthusiasms, but his concerns were echoed by his successor, Mr. John Bridgeman, who referred the matter to the restrictive trade practices court and asked it to examine whether the Premier league—not just the deal with Sky, but the rule book as well—was operating as a cartel. If the restrictive trade practices court rules that the Premier league and other leagues are operating as a cartel, football on television will be plunged into chaos.
  That will affect not only the clubs, but the players. The players' union has agreed with the clubs that, unlike politicians, who sometimes get paid for appearing on television, players will not receive individual payments for television appearances. The players have agreed to accept a percentage of the Sky money that goes to the clubs, and that money goes to the players' union. It is used to train players, to pay for their university education when they finish their football careers or to help players who suffer a serious injury and have to retire from the game at 23 or 24. It is used for beneficial purposes.

  759
  If the copyright belonged to the player or the player's agent, an agent could say, "You cannot show the goal of the month without paying Cantona £1,000 and a repeat fee of £250 every time it is shown". The goals in the UEFA tournament could not be shown at any other time without constant repeat fees having to be paid, just as Andrew Lloyd Webber receives royalties every time anyone plays his music. It would be an absolute shambles. Unless the Government examine the clause carefully, the entire system will be thrown into Hollywood-type negotiations.
  As the right hon. and learned Member for Putney said, football is now a great worldwide business. I accompanied Mr. Rick Parry, chief executive of the Premier league, to the Department of Trade and Industry—with respect to the Minister of State, Department of National Heritage, it is also a matter for the Department of Trade and Industry.
  The Minister for Competition and Consumer Affairs was most sympathetic. We pointed out that the President of the Board of Trade went to China with the England team because of the trade possibilities. If England want to play Chile, Chile will play at Wembley for nothing, but will require a fee of £250,000 to play at Manchester. The reason is simple. When Chile play at Wembley, there will be exhibitions and embassies will host trade delegations. We flew a planeload of business men to China when the England team played there.
  There are massive trade advantages to be gained. Sky makes deals not for fun but because they sell the game around the world. Last Thursday, a delegation from Thailand visited the Select Committee. My hon. Friend the Member for Wigan (Mr. Stott) was there. The delegation was most enthusiastic about British football.
  British football is fast and exciting and everybody loves watching it on television. Other countries tend to play it like chess. They make 25 sideways passes and 15 backwards passes and bore everybody stiff. Our teams do not do that; they entertain. That is why British football sells around the world. It is a great money earner and helps our export trade. The current proposal puts all that business in jeopardy, so we are asking the Minister to accept our reasonable amendment.
  The European Competition Commissioner, Mr. Karel van Miert, is strongly in favour of the existing system—the governing bodies' right to sell centrally. He is not a particular friend of British football as he opposed the Bosman regulations on player transfer deals and supported something that was not so good for football. On this issue, however, he supports the present set-up as being fair competition and in the best interests of the industry.
  From the point of view of his own Department, the DTI, the Minister for Science and Technology would be well advised to discuss the new clause with some of his colleagues. He should accept, as the American sporting bodies have accepted, that a group of teams is not a cartel. Those teams compete with each other, and can be relegated. That is true of all leagues. Three teams may go down every year, and three may come up. It is not a case of a finite number of teams co-operating to extract the maximum profit; it is competition at the highest level, and as such it should be allowed to continue.
  Mr. Brian Wilson: I declare a modest interest, as unpaid parliamentary adviser to the Scottish Professional Footballers Association. I support
  760
  the new clause. I want to pick up a point made by my hon. Friend the Member for Bassetlaw (Mr. Ashton), but, before doing so, to disagree with what he said about the Bosman case. I think that its outcome was good for football.
  The right hon. and learned Member for Putney (Mr. Mellor) rightly said that all teams benefit from television rights, but my hon. Friend the Member for Bassetlaw was also correct in pointing out that the Professional Footballers Association in England also benefits significantly from such rights and from the principle, established some 30 years ago, of enabling it to secure a percentage of what is paid by television companies. As a result, the association has been able to do a fantastic job for players.
  We are not talking just about the big earners; we are talking about jobbing professionals at all levels of the game, most of whom do not go on to stardom, fame and fortune. After a few years, many find that their football careers are behind them. That is why the role of the players' associations is so important. They must be given the money to enable them to do their job properly, as they have been in England for the past 30 years.
  I take account of the arguments advanced by the clubs, but I hope that in future the rights of players' associations to benefit from all the money that is flowing into the game will be statutorily underpinned. It would be a supreme irony if more and more money went into the game from the television companies, while the hard-earned rights that the players' associations have built up over the years were eroded by the clubs that were gaining increased funds from television rights. That is a simple point. Unfortunately, it cannot be debated in the context of a new clause that has not been selected, but I hope that hon. Members on both sides of the House will accept that, while football could arguably continue without directors or even commentators, the one group of people without whom it could not continue is the players. If all this money is flowing into the game, it is right that players at all levels should benefit through their associations.
  Mr. Tom Pendry: Opposition Members are pleased to be able to support the new clause tabled by the right hon. and learned Member for Putney (Mr. Mellor). Along with the accompanying amendment, it exempts football—and any other sport that the Secretary of State may add—from the provisions of the Restrictive Practices Act 1976.
  As the right hon. and learned Gentleman pointed out, this new clause and others result directly from the Office of Fair Trading's decision to refer the Premier league to the restrictive practices court. According to the OFT, the league is acting as a cartel in the sale of broadcasting rights. Many hon. Members on both sides of the House feel that it ignores the fact that, as my hon. Friend the Member for Bassetlaw (Mr. Ashton) pointed out, the composition of the league is constantly changing through promotion and relegation: over a five-year period, some 75 per cent. of its membership may have changed. As the Minister knows, I raised the matter with him in a letter on 15 February, in which I urged the Government to consider a measure such as new clause 24. Unfortunately the Minister was not able to respond to my request, but the House now has an opportunity to vote on the issue. I hope that it will support the new clause.

  761
  The OFT's decision is bizarre, and it is odd that it took it so long to make up its mind. The Premier league rules are the same as those of the Football League, which has been in business since 1888. They are also very similar to the rules of most other team sports in which a collective negotiation of television rights is at stake. God alone knows why the Premier league was picked out.
  As the right hon. and learned Member for Putney pointed out, the decision will have severe consequences, not just for football but for all sports in which a governing body acts in the collective name of clubs to sell rights. I believe that the OFT is considering a further 18 such deals involving major sports. We may not always agree with the deals that are struck by those sports, but I am sure that hon. Members will agree that any change to the current system of selling rights would bring chaos to sport as a whole. The logic of the OFT's referral decision would enable individual football clubs to sell their own rights, favouring the big clubs with financial muscle to the detriment of smaller Premier league sides. The big clubs would want to sell the rights of their games, perhaps on a pay-for-view basis, making millions in the process. Smaller clubs such as my own beloved Derby County—I am pleased that my hon. Friend the Member for Ashfield (Mr. Hoon) is here, as it is his beloved club as well; it will be playing for the first time in the premiership next season—will have difficulty in reaching any reasonable deal if the legislation is passed.
  5.45 pm
  As I have said, the legislation will lead to chaos, not just in football but in other sports. We have all seen what has happened in the case of the Rugby Union Five Nations—or should we say Four Nations?—championship when one broadcaster has tried to strike different deals with different parties. That is clearly not a model that we would wish other sports to follow. I hope that the Minister agrees.
  I shall say no more. I think that we should all speak briefly in debates such as this, given the consensus between the two sides of the House. I hope that the Minister will respond to the pleas of those who have spoken so far, and will give us some idea of the Government's thinking.
  Mr. Sproat: The whole House will be grateful to my right hon. and learned Friend the Member for Putney (Mr. Mellor) for bringing this important and topical matter to our attention. I have great sympathy with what he has said and with his intentions, and I have taken careful note of the points that he has made. I understand, and to a great extent share, the concerns that he and other hon. Members have expressed, and, in particular, his view that the current agreements operate in the public interest and are necessary in the light of the character of the services and the game involved. As he will know, however, the referral of the Premier league does not necessarily mean that all such sports agreements risk ending up before the courts. At the time of the referral, the Director General of Fair Trading made it clear that he considered that the Premier league had a major, if not unique, position in the market for television programmes, and that other agreements for the broadcasting of sport being considered by the OFT
  762
  were unlikely to be so significant as to warrant investigation by the court, although each was being considered on its merits.
  It may offer some comfort to my right hon. and learned Friend, and to others who have spoken, if I explain that the existing competition regime includes protections against the negative effects that my right hon. and learned Friend has mentioned. When the Director General of Fair Trading identifies restrictions in a registrable agreement, he has a duty to refer the matter to the restrictive practices court. An example is the case of the Premier league's collective selling arrangements for broadcasting rights. The court will then consider whether such restrictions are in the public interest. When the parties to an agreement can satisfy the court that the arrangements are beneficial, the court may decide that the agreements operate in the public interest, and not strike them down. One way in which that may be done is by convincing the court that the restriction in question would bring specific and substantial benefits to the public. That is my personal view.
  The debate has given hon. Members on both sides of the House an opportunity to make clear their belief that such an arrangement would not operate in the interests of sport. My hon. Friend the Minister for Science and Technology, who is sitting next to me, has heard what has been said, and I can tell my right hon. and learned Friend the Member for Putney that I shall ensure that the report of the debate and a covering letter are sent to the restrictive practices court, making the views of the House clear. I hope that, having been given that assurance, he will seek leave to withdraw his valuable new clause.
  Mr. Mellor: I beg to ask leave to withdraw the motion.
  Motion and clause, by leave, withdrawn.

New clause 40

  DUTY OF RADIO AUTHORITY TO SET CRITERIA FOR PROMOTION OF DIVERSITY
  '.—(1) Section 86 of the 1990 Act is amended as follows.
  (2) Before inviting applications for a licence to provide any of the services mentioned in section 84. the Authority shall publish in draft the criteria which appear to them to be necessary for the achievement of the objectives set out in section 85, with particular reference to the promotion of diversity.
  (3) The Authority shall, at the same time as publishing draft criteria under subsection (2) above, invite observations on them within such period, which shall be not less than three months, as may be specified by the Authority.
  (4) The Authority shall take account of any observations received under subsection (3) above before confirming the draft criteria, which shall be published with such modifications as the Authority think fit.'. —[Mr. Austin Mitchell.]
  Brought up, and read the First time.
  Mr. Austin Mitchell: I beg to move, That the clause be read a Second time.
  Madam Deputy Speaker: With this, it will be convenient to discuss the following amendments: No. 240, in clause 87, page 78, line 27, leave out `eight' and insert 'five'.
  No. 238, in clause 88, page 81, line 11, leave out 'eight' and insert 'five'.
  Mr. Mitchell: The new clause and the amendments are an attempt to promote, support and encourage diversity

  763
  and pluralism in radio, to maximise the variety of radio stations. I think that those are also the aims of the Radio Authority. It is the logical future of radio because it is a medium in which there can no longer be monolithic radio stations serving a wide variety of tastes.
  Stations should cater for sectionalised tastes so that each can recruit its own audience on the back of music that is designed to appeal to that audience. That audience, which may have been recruited by classical music, talk, chart music or by golden oldies for people like me, will then be provided with the kind of news, information and advertisements that are relevant to it and will appeal to it. Identity is built up through the music.
  I sometimes think that new Labour is a Classic FM party. That is our kind of station. It has beautiful themes in short bursts and it is civilised, clean, well presented and eminently desirable. The technique is simple and straightforward and it emerged in American radio and is now being pursued in this country. It is logical to encourage diversity so that as many audiences as possible can be catered for by as many stations as possible. The question posed by the amendments is whether the Radio Authority is going about the provision of diversity in the right way. I question the effectiveness of its decision-making processes.
  The best example of the Radio Authority's inability to take good decisions is LBC. The name was abolished and the station was given to somebody else, who made a total mess of it. After going through changes of ownership and format, it has reverted to its original title but with different programming and it has lost a massive audience in the process. An odd decision led to that and another odd decision was made in relation to Jazz FM in the north-west.
  The Radio Authority's decisions based on its remit to provide diversity are in question. I mention that in the light of my own experience of an application—this is where I declare an interest—for a regional radio contract in Yorkshire. That is what gave rise to the new clause. We started by trying to decide the sort of audience to which we wanted to appeal. In a sense we wanted to appeal to new Yorkshire—to people between 25 and 45. We were advised, and our research and the experience of other stations told us, that we could reach that audience by presenting it with a diet of adult contemporary music. On the basis of that, we could also reach that audience with programmes on art, news and information about Yorkshire.
  Yorkshire has its own proud identity and we made our application on that basis. It was not an appeal to teeny-boppers or to the kids who listen to chart music, nor to geriatrics like me who listen to Capital Gold or easy listening stations. However, the Radio Authority had other ideas. It decided that the Yorkshire station should provide hip-hop dance music for kids. It said that Yorkshire had 3 million adults and that it would give the radio station to the kids. The station went to an outside organisation. The decision was an insult to Yorkshire.
  Regional radio stations are rather different from those in big conurbations where dance music might be appropriate for a teenage audience. The problem relates to the way in which the decision was reached. We were told that the authority would deliberate on the applications on a Thursday and announce the result that afternoon. However, two days before that press steers said that the
  764
  authority was likely to decide on a dance music station. That means that the programming that the authority desired was made known, presumably by steers from Radio Authority staff, before the authority decided which station was to provide that sort of music.
  If the Radio Authority thought that it should fill in the map on the basis of jazz for Lancashire, adult contemporary music for the west midlands, talk and contemporary music for Newcastle and dance music for Yorkshire, it would have been better to say so in advance. Those steers to the press must have come from the authority. They certainly did not come from the bidders, most of whom had bid for other sorts of music and were unlikely to release press statements stating that the station would be broadcasting material different from what they intended to provide. If the steer came from the authority, it must have known in advance the music format that it wanted in Yorkshire.
  The new clause would make the Radio Authority declare its views in advance of applications, because if it does not do so two problems will arise. The first relates to the Radio Authority staff and whether they communicate the authority's views to the industry. Members of the staff have friends and they play golf. They are bound, as they should be, to maintain contacts, to mix with people and to play leading roles. The imputation will be that if they know that the authority is thinking along the lines of dance music for Yorkshire and adult contemporary music for the west midlands, it will be mentioned in conversation with people who submit applications for radio stations. I want to free the authority's staff from the imputation that information is being leaked in advance.
  Secondly, I want to avoid the waste of time that is implicit in a process in which many people make applications at considerable expense. There were 13 applications for the Yorkshire contract, all of which involved expensive research, interviews, preparation, consultation and advice. It was an expensive business and it was a waste of time for applications which did not accord with the music format that the authority thought appropriate for Yorkshire. One applicant said to me, "We have put in five applications and none of them has been successful. We do not intend to put in any more. We are fed up with the whole business." If the authority thought that Yorkshire was right for hip-hop dance music, it should have said so in advance.
  The new clause would make the process transparent by requiring the authority to say in advance that a new station in, for example, region A or town B should transmit dance music or be an easy listening station. It should state the format that it wants in the overall plan. That information should be contestable, so that interested parties can say, "No, we think that an appropriate format for this region is something different." The authority would be required to justify its decision and, in the light of the arguments and representations received, it could ask for applications for a specific kind of music.
  People would know where they stand and those who did not want to apply need not bother. I would certainly not have applied for a dance music station because I would be wasting my time on it and such music is not appropriate to a regional station. Everything would be clear. Amendments Nos. 240 and 238 are designed simply to prevent renewal, because the radio industry is born free but everywhere it is in chains. Takeovers by big chains are

  765
  increasing and radio stations are losing their local identity. They have national promotion patterns, with disc jockeys who have no roots in the region being moved in and out and playing lists being decided outside the region. That is stultifying radio. Let us have more opportunities for people to apply by shortening the renewal period
  The new clause and the two amendments provide, therefore, for more diversity and greater frequency of change in radio. I commend them to the House.
  6 pm
  Mr. Sproat: Section 105 of the Broadcasting Act 1990 lays down four criteria that the Radio Authority must take into account in determining to whom a local licence should be awarded. They are: the ability of the applicant to maintain the service throughout the period of the licence; the extent to which the proposed service would cater for the tastes and interests of people in the area receiving the broadcast; the extent to which any proposed service would broaden the range of services available in the area; and the extent to which the application is supported by people living in the receiving area.
  In addition to those general criteria, new clause 40 would require the authority to publish more detailed criteria. I am not convinced that such detailed criteria would act in the public interest. They would risk fettering the authority's discretion and lead to blander and more formulaic applications. More generally, as a point of principle, politicians should not instruct the authority how to go about its business in fulfilling the task that it has clearly been set by Parliament.
  On amendments Nos. 240, 238 and 239, clause 87 provides for national radio licence holders—Classic FM, Talk Radio and Virgin—to have their licences renewed for a further eight years if they take up their guaranteed slots on digital radio. That provides those broadcasters with greater security to undertake the considerable investment needed to launch their digital services. Similarly, clause 88 allows a local radio station to renew its analogue licence if it has committed itself to digital broadcasting. Again, the renewal period is eight years, the length of the analogue licence.
  We believe that the prospect of renewal will be an important factor in decisions to invest in digital radio. I therefore cannot accept the amendments and I hope that, with my explanation, the hon. Gentleman will not press them.
  Mr. Austin Mitchell: I beg to ask leave to withdraw the motion.
  Motion and clause, by leave, withdrawn.

New schedule 2
  TRANSFER SCHEMES RELATING TO THE BBC TRANSMISSION NETWORK: TAXATION PROVISIONS

    Interpretation
    1.—(1) In this Schedule, unless the context otherwise requires—
    "the Allowances Act" means the Capital Allowances Act 1990;
    "the BBC transmission network" has the meaning given by section 125(2);
    766
    "the Capital Allowances Acts" has the meaning given by section 832(1) of the Taxes Act 1988;
    "direct disposal scheme" means a transfer scheme which is not a preparatory scheme;
    "direct disposal transfer" means a transfer in accordance with a direct disposal scheme;
    "the documents regulating the BBC" includes—

    (a) the Royal Charter of 1st May 1996 for the continuance of the British Broadcasting Corporation; and

    (b) the Agreement dated 25th January 1996 between Her Majesty's Secretary of State for National Heritage and the British Broadcasting Corporation;

    "the Gains Act" means the Taxation of Chargeable Gains Act 1992;
    "modification agreement" has the meaning given by paragraph 7(7) of Schedule 5;
    "preparatory scheme" means a transfer scheme whose main purpose is to provide for a transfer of property, rights or liabilities from the BBC to a wholly-owned subsidiary of the BBC;
    "preparatory transfer" means a transfer in accordance with a preparatory scheme;
    "relevant transfer" means a transfer in accordance with a transfer scheme;
    "successor company" means a company to which property, rights or liabilities are transferred in accordance with a preparatory scheme at a time when the company is a wholly-owned subsidiary of the BBC;
    "the Taxes Act 1988" means the Income and Corporation Taxes Act 1988;
    "transfer", except for the purposes of paragraphs 13 to 18, includes—

    (a) any transfer effected by or under an agreement or instrument entered into or executed in pursuance of an obligation imposed by a provision contained in a transfer scheme by virtue of paragraph 2(1)(g) of Schedule 5;

    (b) the creation of interests, rights or liabilities by or under any such agreement or instrument; and

    (c) the creation of interests, rights or liabilities by virtue of any provision contained in a transfer scheme by virtue of paragraph 2 of Schedule 5;
    and references to a transfer in accordance with a transfer scheme (or any description of transfer scheme) shall be construed accordingly;

    "transferee"—

    (a) in relation to a transfer scheme, means a person to whom property, rights or liabilities are transferred in accordance with the transfer scheme; and

    (b) in relation to a relevant transfer, means the person to whom the property, rights or liabilities in question are transferred in accordance with the transfer scheme in question;

    "wholly-owned subsidiary" has the meaning given by section 736 of the Companies Act 1985.
    (2) In any provision of this Schedule "the prescribed amount", in relation to any transferee under a transfer scheme, means such amount as may he specified by the Secretary of State by order for the purposes of that provision in its application to that transferee.
    (3) This Schedule—

    (a) so far as it relates to corporation tax, shall be construed as one with the Corporation Tax Acts, and

    (b) so far as it relates to capital allowances, shall be construed as one with the Capital Allowances Acts.

    Chargeable gains: preparatory transfers etc to be without gain or loss
    2.—(1) For the purposes of corporation tax on chargeable gains, the disposal of property. rights or liabilities which is constituted by a preparatory transfer shall, subject to the following provisions of this Schedule, be taken in relation to both—

    (a) the person to whom the disposal is made, and

    (b) the person making the disposal,
    to be effected for a consideration such that no gain or loss accrues to the person making the disposal.

    (2) Section 171(1) of the Gains Act (which makes provision in relation to the disposal of assets from one member of a group of companies to another member of the group) shall not apply where the disposal in question is a preparatory transfer.
    Chargeable gains: amendment of section 35(3)(d) of the Gains Act
    3. In section 35(3)(d) of the Gains Act (list of provisions for transfers without gain or loss for purposes of provisions applying to assets held on 31st March 1982) after sub-paragraph (xi) there shall he inserted—
    "(xii) paragraph 2(1) of Schedule (Transfer schemes relating to the BBC transmission network: taxation provisions) to the Broadcasting Act 1996;".
    Chargeable gains: section 41 of the Gains Act
    Subsection (1) of section 174 of the Gains Act (which applies section 41 of that Act to cases where assets have been acquired without gain or loss) shall have effect, without prejudice to paragraph 2, where there has been a preparatory transfer as if the asset to which the preparatory transfer relates had thereby been transferred and acquired in relevant circumstances, within the meaning of that subsection.
    Chargeable gains: assets held before 6th April 1965
    5. Schedule 2 to the Gains Act (assets held on 6th April 1965) shall have effect in relation to any assets which are transferred to a successor company in accordance with a preparatory scheme as if—

    (a) the BBC and the successor company were the same person; and

    (b) those assets, to the extent that they were in fact acquired or provided by the BBC, were acquired or, as the case may be, provided by the successor company.

    Chargeable gains: sale of successor company group transactions
    6.—(1) For the purposes of section 179 of the Gains Act (company ceasing to be a member of a group), where any company ("the degrouped company") ceases, by virtue of a qualifying transaction, to he a member of a group of companies, the degrouped company shall not, by virtue of that qualifying transaction, be treated under that section as having sold, and immediately reacquired, any asset acquired from a company which falls to be regarded for the purposes of subsection (1) of that section as having been at the time of acquisition a member of that group.

    (2) Where, disregarding any preparatory transactions, a company would be regarded for the purposes of section 179 of the Gains Act (and, accordingly, of this paragraph) as ceasing to be a member of a group of companies by virtue of a qualifying transaction, it shall be regarded for those purposes as so doing by virtue of the qualifying transaction and not by virtue of any preparatory transactions.

    (3) In this paragraph—

    "preparatory transaction", in the case of any qualifying transaction, means anything done for the purpose of initiating, advancing or facilitating the qualifying transaction;
    "qualifying transaction" means the disposal by the BBC of any shares or securities of a successor company.
    (4) Expressions used in this paragraph and in section 179 of the Gains Act have the same meaning in this paragraph as they have in that section.
    Chargeable gains: sale or exchange of shares or securities of successor company
    7.—(1) Where a company issues shares or debentures to the BBC in exchange for shares in or debentures of a successor company which have not, before that exchange, been disposed of by the BBC—

    (a) sections 127 to 131 of the Gains Act (reorganisation or reduction of share capital) shall not apply by virtue of subsection (3) of section 135 of that Act (exchange of securities) in relation to that exchange, and

    (b) section 116 of that Act (reorganisations, conversions and reconstructions) accordingly does not have effect in relation to that transaction,

    and the following provisions of this paragraph shall apply accordingly.
    (2) The following provisions of this paragraph apply in any case where—

    (a) there is a preparatory transfer to a successor company;

    (b) the BBC disposes of any shares or securities of the successor company for a consideration in money or money's worth; and

    (c) those shares or securities are shares or securities which were—

    (i) held by or on behalf of the BBC immediately before the preparatory transfer takes effect, or

    (ii) issued to or for the BBC at a time when the successor company is a wholly-owned subsidiary of the BBC,
    and which have not previously been disposed of by the BBC.

    (3) For the purposes of corporation tax on chargeable gains, neither a chargeable gain nor an allowable loss shall be regarded as arising to the BBC on the disposal mentioned in sub-paragraph (2)(b).
    (4) If the consideration for the disposal mentioned in sub-paragraph (2)(b) consists of or includes a right to any variable deferred consideration, then, for the purposes of corporation tax on chargeable gains, neither a chargeable gain nor an allowable loss shall be regarded as arising to the BBC on the disposal of the right to the variable deferred consideration.
    (5) In this paragraph "variable deferred consideration" means any consideration—

    (a) which is not to be given until after the disposal mentioned in sub-paragraph (2)(b); and

    (b) whose amount or value, as at the time when it is to be given, is not ascertainable at the time of that disposal.

    No chargeable gain or allowable loss to arise on any disposal constituted by a direct disposal transfer
    8.—(1) For the purposes of corporation tax on chargeable gains, neither a chargeable gain nor an allowable loss shall be regarded as arising to the BBC on any disposal constituted by a direct disposal transfer.

    (2) If the consideration for a direct disposal transfer consists of or includes a right to any variable deferred consideration, then, for the purposes of corporation tax on chargeable gains, neither a chargeable gain nor an allowable loss shall be regarded as arising to the BBC on the disposal of the right to the variable deferred consideration.

    (3) In this paragraph "variable deferred consideration", in the case of any direct disposal transfer, means any consideration—

    (a) which is not to be given until after the direct disposal transfer; and

    (b) whose amount or value, as at the time when it is to be given, is not ascertainable at the time of the disposal constituted by that transfer.

    No chargeable gain or allowable loss to arise on any disposal
    constituted by a direct disposal transfer
    8.—(1) For the purposes of corporation tax on chargeable gains, neither a chargeable gain nor an allowable loss shall be regarded as arising to the BBC on any disposal constituted by a direct disposal transfer.

    (2) If the consideration for a direct disposal transfer consists of or includes a right to any variable deferred consideration, then, for the purposes of corporation tax on chargeable gains, neither a chargeable gain nor an allowable loss shall be regarded as arising to the BBC on the disposal of the right to the variable deferred consideration.

    (3) In this paragraph "variable deferred consideration", in the case of any direct disposal transfer, means any consideration—

    (a) which is not to be given until after the direct disposal transfer; and

    (b) whose amount or value, as at the time when it is to be given, is not ascertainable at the time of the disposal constituted by that transfer.

    Chargeable gains: value shifting
    9.—(1) Nothing in Part VI of this Act, and no instrument or agreement made, or other thing done, under or by virtue of that Part or for the purpose of initiating, advancing or facilitating the disposal by the BBC of—

    769

    (a) the whole or any part of the BBC transmission network, or

    (b) any shares or securities of a successor company which are shares or securities which were—

    (i) held by or on behalf of the BBC immediately before a preparatory transfer to the successor company takes effect, or

    (ii) issued to or for the BBC at a time when the successor company is a wholly-owned subsidiary of the BBC,
    and which have not previously been disposed of by the BBC,

    shall be regarded as a scheme or arrangement for the purposes of section 30 of the Gains Act (value-shifting).
    (2) In any case where—

    (a) an asset which is the subject of a preparatory transfer has previously been the subject of a scheme or arrangements falling within subsection (1) of section 30 of the Gains Act,

    (b) in consequence, subsection (5) of that section (consideration on disposal to be treated as increased for certain purposes) would, apart from sub-paragraph (3), have had effect in relation to the consideration for the preparatory transfer, and

    (c) the consideration for the preparatory transfer falls to be determined, for the purposes of corporation tax on chargeable gains, under paragraph 2,
    sub-paragraph (3) shall apply.

    (3) Where this sub-paragraph applies—

    (a) subsection (5) of section 30 of the Gains Act shall not have effect in relation to the consideration for the preparatory transfer; but

    (b) on the first subsequent disposal of the asset which is neither a preparatory transfer nor a group disposal—

    (i) that subsection shall have effect in relation to the consideration for that disposal (whether or not it would otherwise have done so); and

    (ii) the increase that falls to be made under that subsection shall be so calculated as to include any increase which would, but for paragraph (a) above, have fallen to he made in relation to the preparatory transfer.

    (4) In this paragraph "group disposal" means a disposal which falls to be treated by virtue of section 171(1) of the Gains Act as made for a consideration such that no gain or loss accrues to the person making the disposal.
    Chargeable gains: receipt of compensation or insurance money
    10.—(1) Subsection (4) of section 23 of the Gains Act (adjustments where compensation or insurance money used for purchase of replacement asset) shall have effect in accordance with sub-paragraph (3) in any case where—

    (a) there is a relevant transfer such that—

    (i) a capital sum received by the BBC by way of compensation for the loss or destruction of an asset, or under a policy of insurance of the risk of the loss or destruction of an asset, becomes available to the transferee; or

    (ii) a right of the BBC to receive such a sum is transferred to the transferee, and the transferee receives that sum; and

    (b) the transferee acquires an asset in circumstances where—

    (i) had there been no such relevant transfer, and

    (ii) had the BBC acquired the asset by the application of that sum,

    the BBC would be treated for the purposes of that subsection as having so acquired the asset in replacement for the asset lost or destroyed.
    770
    (2) Subsection (5) of that section (adjustments where a part of any compensation or insurance money is used for the purchase of a replacement asset) shall have effect in accordance with sub-paragraph (3) in any case where—
    (a) there is a relevant transfer such that—

    (i) a capital sum received by the BBC by way of compensation for the loss or destruction of an asset, or under a policy of insurance of the risk of the loss or destruction of an asset, becomes available to the transferee; or

    (ii) a right of the BBC to receive such a sum is transferred to the transferee, and the transferee receives that sum; and

    (b) the transferee acquires an asset in circumstances where—

    (i) had there been no such relevant transfer, and

    (ii) had the BBC acquired the asset by the application of all of that sum except for a part which was less than the amount of the gain (whether all chargeable gain or not) accruing on the disposal of the asset lost or destroyed,

    the BBC would be treated for the purposes of that subsection as having so acquired the asset in replacement for the asset lost or destroyed.
    (3) In a case falling within sub-paragraph (I) or (2) of this paragraph, subsection (4) or, as the case may be, subsection (5) of section 23 of the Gains Act shall have effect as if the transferee and the BBC were the same person, except that—
    (a) in a case falling within sub-paragraph (1)(a)(i) or (2)(a)(i)—

    (i) any claim under the subsection in question must be made by the BBC and the transferee; and

    (ii) any adjustment to be made in consequence of paragraph (a) of that subsection shall be made for the purposes only of the taxation of the BBC; and

    (b) in a case falling within sub-paragraph (l)(a)(ii) or (2)(a)(ii)—

    (i) any claim under the subsection in question must be made by the transferee; and

    (ii) any adjustment to be made in consequence of paragraph (a) of that subsection shall he made for the purposes only of the taxation of the transferee.

    Loan relationships: disposal of securities by BBC
    11.—(1) This paragraph applies in any case where—

    (a) there is a preparatory transfer to a successor company;

    (b) the BBC disposes of any securities of the successor company for a consideration in money or money's worth; and

    (c) those securities are securities issued to or for the BBC in consideration for the preparatory transfer.

    (2) Where this paragraph applies, any debits or credits which, by reason of the disposal mentioned in sub-paragraph (1)(b), would, apart from this sub-paragraph, be given by Chapter II of Part IV of the Finance Act 1996 (loan relationships) in respect of a loan relationship for an accounting period of the BBC shall not be brought into account for the purposes of that Chapter as respects the BBC.
    Transfer of trade: loss relief and capital allowances
    12. —(1) This paragraph applies in any case where, as a result of a relevant transfer,—

    (a) the BBC ceases to carry on a trade; and

    (b) the transferee begins to carry on that trade.

    (2) Where this paragraph applies, section 343 of the Taxes Act 1988 (company reconstructions without change of ownership) shall not have effect in relation to the event described in sub-paragraph (1).

    (3) Where this paragraph applies, the trade mentioned in sub-paragraph (1) shall not be treated as permanently discontinued nor a new trade as set up and commenced for the purpose of the allowances and charges provided for by the Capital Allowances Acts; but—

    771

    (a) there shall be made to or on the transferee in accordance with those Acts all such allowances and charges as would, if the BBC had continued to carry on the trade, have fallen to be made to or on it; and

    (b) the amount of any such allowance or charge shall be computed as if—

    (i) the transferee had been carrying on the trade since the BBC began to do so; and

    (ii) everything done to or by the BBC had been done to or by the transferee (but so that no sale or transfer which on the transfer of the trade is made to the transferee by the BBC of any assets in use for the purpose of the trade shall be treated as giving rise to any such allowance or charge).

    (4) For the purposes of this paragraph—

    (a) where, on the BBC ceasing to carry on a trade, a company begins to carry on the activities of the trade as part of its trade, then that part of the trade carried on by the company shall he treated as a separate trade, if the effect of so treating it is that this paragraph applies by virtue of sub-paragraph (1) on that event in relation to that separate trade; and

    (b) where, on the BBC ceasing to carry on part of a trade, a company begins to carry on the activities of that part as its trade or part of its trade, the BBC shall be treated as having carried on that part of its trade as a separate trade if the effect of so treating it is that this paragraph applies by virtue of sub-paragraph (1) on that event in relation to that separate trade.

    Capital allowances: industrial buildings and structures
    13. —(1) This paragraph applies in any case where there is a relevant transfer of property which is, for the purposes of Part I of the Allowances Act (industrial buildings and structures), the relevant interest in relation to any expenditure incurred on the construction of a building or structure.
    (2) Where this paragraph applies, the Secretary of State may by order make provision specifying, as respects the transferee,—

    (a) the amount which is to be taken for the purposes of Part I of the Allowances Act to be the amount of the capital expenditure incurred on the construction of the building or structure; and

    (b) the date which is to be taken for the purposes of that Part as the date on which the building or structure was first used.

    (3) This paragraph shall not have effect in relation to any property if paragraph 12(3) has effect in relation to it.
    Capital allowances: machinery and plant
    14.—(1) For the purposes of Part II of the Allowances Act (capital allowances in respect of machinery and plant) property which is transferred to a successor company in accordance with a preparatory scheme shall be treated as if—

    (a) it had been acquired by the successor company, for the purposes for which it is used by that company on and after the date on which the transfer of the property in accordance with the scheme takes effect, on that date; and

    (b) capital expenditure of the prescribed amount had been incurred on that date by the successor company on the acquisition of the property for the purposes mentioned in paragraph (a).

    (2) This paragraph shall not have effect in relation to any property if paragraph 12(3) has effect in relation to it.
    Capital allowances: leased fixtures
    15. —(1) This paragraph applies to any lease which is granted in pursuance of an obligation imposed by a provision contained in a preparatory scheme by virtue of paragraph 2(1)(g) of Schedule 5.
    772

    (2) Where the conditions in paragraphs (a) and (b) of subsection (1) of section 55 of the Allowances Act (expenditure incurred by incoming lessee: transfer of allowances) are fulfilled in relation to a lease to which this paragraph applies—

    (a) the lessee shall be deemed for the purposes of Part II of that Act to have given as consideration for the lease a capital sum which falls to be treated for the purposes of that Part as expenditure on the provision of the fixture concerned;

    (b) the amount of that capital sum shall be the prescribed amount; and

    (c) subsection (4)(a) of that section shall he disregarded.

    (3) Where the conditions in paragraphs (a), (c) and (d) of section 56 of the Allowances Act (expenditure incurred by incoming lessee: lessor not entitled to allowances) are fulfilled in relation to a lease to which this paragraph applies—

    (a) the lessee shall be deemed for the purposes of Part II of that Act to have given as consideration for the lease a capital sum which falls to be treated for the purposes of that Part as expenditure on the provision of the fixture concerned; and

    (b) the amount of that capital sum shall be the prescribed amount.

    Capital allowances: connected persons
    16. In Part II of the Allowances Act (machinery and plant) references to a transaction (however described) between connected persons within the meaning of section 839 of the Taxes Act 1988 shall not include references to a preparatory transfer.
    Capital allowances: agricultural buildings
    17. —(1) This paragraph applies in any case where there is a relevant transfer of property which is the relevant interest in relation to any expenditure for which the BBC would be entitled to an allowance under Part V of the Allowances Act (agricultural buildings etc) apart from section 128 of that Act (balancing allowances and charges).
    (2) Where this paragraph applies—

    (a) the acquisition of the relevant interest by the transferee shall, as respects the transferee, be treated for the purposes of Part V of the Allowances Act as a balancing event falling within subsection (1)(a) of section 129 of that Act (so that, in particular, subsection (3) of that section applies by reason of its occurrence); and

    (b) it shall accordingly be assumed, as respects the transferee, that an election has been made under subsection (2) of that section (acquisition of relevant interest by another not to be a balancing event without an election under that subsection) with respect to the acquisition of the relevant interest by the transferee.

    (3) Where this paragraph applies, subsection (3) of section 129 of the Allowances Act (entitlement of the new owner to allowances) shall, as respects the transferee, have effect with the following modifications, that is to say

    (a) the period which, by virtue of paragraph (a) of that subsection, is to be treated as if it were itself the writing-down period in which the allowances in respect of the expenditure in question were to be made shall be such period as the Secretary of State may by order specify; and

    (b) the expenditure which, by virtue of paragraph (b) of that subsection, is to be treated as the expenditure in respect of which the transferee (as being the new owner, within the meaning of that section) is entitled to the allowances mentioned in that paragraph shall be equal to the prescribed amount (without any reduction or addition under that paragraph).

    (4) This paragraph shall not have effect in relation to any property if paragraph 12(3) has effect in relation to it.
    Corporation tax: BBC and successor company to be treated as one for certain purposes
    18. —(1) If any property, rights or liabilities are transferred to a successor company in accordance with a preparatory scheme, then, subject to sub-paragraph (2), the following provisions shall apply for the purposes of the Corporation Tax Acts in their application in respect of any accounting period ending on or after the date on which the transfer takes effect, namely—

    (a) any trade or part of a trade carried on by the BBC which is transferred in accordance with the preparatory scheme to the successor company shall be treated as having been, at the time of its commencement and at all times since that time, a separate trade carried on by that company;

    (b) the trade or trades carried on by the successor company on and after the date on which the transfer takes effect shall be treated as the same trade or trades as that which, by virtue of paragraph (a), is treated as carried on before that date;

    (c) all property, rights and liabilities of the BBC which are transferred in accordance with the scheme to the successor company shall be treated as having been, at the time when they became vested in the BBC and at all times since that time, property, rights and liabilities of that company; and

    (d) anything done by the BBC in relation to property, rights and liabilities which are transferred to the successor company in accordance with the preparatory scheme shall be treated as having been done by that company.

    (2) Sub-paragraph (I) shall not apply for the purposes of—

    (a) corporation tax on chargeable gains,

    (b) capital allowances, or

    (c) relief for losses incurred in carrying on a trade,
    and no provision included in a scheme by virtue of paragraph 4(2)(a) of Schedule 5 shall have effect for those purposes.

    Corporation tax: no profit or loss under Case 1 of Schedule D by reason of a direct disposal transfer
    19. In determining for the purposes of Case I of Schedule D the profits or gains or losses arising or accruing to the BBC, it shall be assumed that no profits or gains, and no losses, arise or accrue to the BBC by reason of a direct disposal transfer of—

    (a) any trading stock, within the meaning of section 100 of the Taxes Act 1988, belonging to a trade carried on by the BBC;

    (b) any right of the BBC to receive an amount which is for the purposes of corporation tax—

    (i) an amount brought into account as a trading receipt of the BBC for any accounting period ending before the time when the transfer takes effect; or

    (ii) an amount falling to be so brought into account if it is assumed, where it is not the case, that the accounting period of the BBC current on the day before the transfer takes effect ends immediately before that time; or

    (c) the whole or any part of the amount of a liability which falls for the purposes of corporation tax—

    (i) to be brought into account as deductible in computing the profits of any trade carried on by the BBC for any accounting period ending before the time when the transfer takes effect; or

    (ii) to be so brought into account if it is assumed, where it is not the case, that the accounting period of the BBC current on the day before the transfer takes effect ends immediately before that time.

    Corporation tax: group relief
    20. —(1) None of the following, namely—

    (a) the existence of the powers of any Minister of the Crown or the BBC under Part VI of this Act or under the documents regulating the BBC,

    774

    (b) any direction given by a Minister of the Crown under that Part or those documents, so far as that direction relates to a transfer scheme or (in a case where there is a preparatory scheme) to the sale of shares or securities issued by the successor company, or

    (c) any arrangements (of any kind, whether in writing or not) so far as relating to a transfer scheme or any such sale,

    shall be regarded as constituting arrangements falling within subsection (1) or (2) of section 410 of the Taxes Act 1988 (arrangements for the transfer of a company to another group or consortium).
    (2) Neither—

    (a) the existence of the powers of any Minister of the Crown or the BBC under Part VI of this Act or under the documents regulating the BBC, nor

    (b) any direction given as mentioned in sub-paragraph (1)(b),

    shall be regarded as constituting option arrangements for the purposes of paragraph 5B of Schedule 18 to the Taxes Act 1988.
    (3) Any reference in sub-paragraph (1) or (2) to the documents regulating the BBC is a reference to those documents only so far as they have effect in relation to a disposal by the BBC of—

    (a) the whole or any part of the BBC transmission network, or

    (b) any shares or securities of a successor company, or the initiating, advancing or facilitating of any such disposal.

    (4) In this paragraph "Minister of the Crown" has the same meaning as in the Ministers of the Crown Act 1975.
    Corporation tax: leases at an undervalue
    21. —(1) Section 35 of the Taxes Act 1988 (charge on lease granted at an undervalue) shall not apply in the case of any lease which, in accordance with a transfer scheme, is granted—

    (a) to a company which is a transferee under that or any other transfer scheme, or

    (b) by such a company to the BBC.

    (2) Section 87 of the Taxes Act 1988 (taxable premiums) shall not apply where there is an amount which would have become chargeable in relation to any land but for sub-paragraph (1); and, accordingly, references to any such amount shall not be included in references in that section to the amount chargeable.

    (3) In this paragraph "lease" has the same meaning as in Part II of the Taxes Act 1988.

    Corporation tax: sale and lease-back
    22. —(1) Section 779 of the Taxes Act 1988 (sale and lease-back: limitation on tax reliefs) shall not apply where the liability of the transferor or of the person associated with that transferor is as a result of—

    (a) the creation, in accordance with a transfer scheme, of any interest or right in favour of a transferee or the BBC;

    (b) any other transaction for which a transfer scheme provides; or

    (c) the grant by a company which is a transferee under a transfer scheme ("the relevant company") to the BBC or to another company which is a transferee (whether under that or any other transfer scheme) of any interest or right, at a time when the relevant company remains a wholly-owned subsidiary of the BBC, in a case where the ability of the relevant company to grant that interest or right derives from the transfer to the company in accordance with a transfer scheme of an estate or interest in land.

    (2) In this paragraph "transferor" has the same meaning as in section 779 of the Taxes Act 1988 and "associated" shall be construed in accordance with that section.
    Corporation tax: sale of lease of land
    23. —(1) Section 780 of the Taxes Act 1988 (sale and lease-back: taxation of consideration) shall not apply where—

    (a) the assignment of the original lease, and

    (b) the grant or assignment of the new lease, each fall within sub-paragraph (2).

    (2) The assignment of the original lease, or the grant or assignment of the new lease, falls within this sub-paragraph if—

    (a) it is a relevant transfer; or

    (b) it takes place between the BBC and a successor company at a time when the successor company remains a wholly-owned subsidiary of the BBC; or

    (c) it takes place between two successor companies at a time when both remain wholly-owned subsidiaries of the BBC.

    (3) The reference in sub-paragraph (1) to the assignment of the original lease and the grant or assignment of the new lease shall be construed in accordance with section 780 of the Taxes Act 1988 and sub-paragraph (2) shall be construed accordingly.
    Corporation tax: leased assets
    24. —(1) For the purposes of section 781 of the Taxes Act 1988 (assets leased to traders and others) where the interest of the lessor or the lessee under a lease, or any other interest in an asset, is transferred in accordance with a transfer scheme to the BBC or a transferee, the transfer shall be treated as being effected without any capital sum having been obtained in respect of that interest by the BBC or the transferee.
    (2) Section 782 of the Taxes Act 1988 (deduction of payment under leases: special cases) shall not apply to any payments made by the BBC or a company which is a transferee under a transfer scheme if the payments are made—

    (a) under any lease created in favour of the BBC or such a company by virtue of, or in pursuance of an obligation imposed by, a provision contained in a transfer scheme by virtue of paragraph 2 of Schedule 5; or

    (b) under any lease—

    (i) which is granted to or by a successor company at a time when it remains a wholly-owned subsidiary of the BBC; and

    (ii) which is a lease of an asset which at any time before the creation of the lease was used by the BBC for the purposes of a trade carried on by the BBC and which was, when so used, owned by the BBC.

    (3) In this paragraph "lease" and "asset" have the meaning given by section 785 of the Taxes Act 1988.
    Stamp duty
    25. —(1) Stamp duty shall not be chargeable on any agreement or instrument to the extent that it is certified by the Secretary of State to the Commissioners of Inland Revenue as being—

    (a) a restructuring scheme,

    (b) a restructuring scheme modification agreement, or

    (c) an instrument giving effect to a restructuring scheme modification agreement,

    or as having been made in accordance with, or in pursuance of an obligation imposed by, a restructuring scheme.
    (2) No agreement or instrument which is certified as mentioned in sub-paragraph (1) shall be taken to be duly stamped unless—

    (a) it is stamped with the duty to which it would be liable, apart from that sub-paragraph; or

    (b) it has, in accordance with section 12 of the Stamp Act 1891, been stamped with a particular stamp denoting that it is not chargeable with that duty or that it is duly stamped.

    (3) Section 12 of the Finance Act 1895 (collection of stamp duty in cases of property vested by Act or purchased under statutory power) shall not operate to require—

    (a) the delivery to the Commissioners of Inland Revenue of a copy of this Act, or

    (b) the payment of stamp duty under that section on any copy of this Act,

    and shall not apply in relation to any instrument on which, by virtue of the preceding provisions of this paragraph, stamp duty is not chargeable.

    (4) In this paragraph—
    "restructuring scheme modification agreement- means a modification agreement, so far as relating to a restructuring scheme;
    "restructuring scheme" means a preparatory scheme, so far as it provides for the transfer of property, rights or liabilities in accordance with the scheme—

    (a) from the BBC to a wholly-owned subsidiary of the BBC;

    (b) to the BBC from a wholly-owned subsidiary of the BBC; or

    (c) from one wholly-owned subsidiary of the BBC to another.

    Stamp duty reserve tax
    26. —(1) An agreement to transfer chargeable securities, as defined in section 99 of the Finance Act 1986, from the BBC to a wholly-owned subsidiary of the BBC shall not give rise to a charge to stamp duty reserve tax if the agreement is made for the purposes of, or for purposes connected with, a restructuring scheme.

    (2) An agreement shall not give rise to a charge to stamp duty reserve tax if the agreement is a restructuring scheme modification agreement.

    (3) In this paragraph "restructuring scheme" and "restructuring scheme modification agreement" have the same meaning as in paragraph 25.

    Modifications of transfer schemes
    27. —(1) If the effect of any transfer scheme is modified in pursuance of a modification agreement, then the Corporation 'Fax Acts and this Schedule, other than paragraphs 25 and 26, shall have effect as if—

    (a) the scheme originally made had been the scheme as modified; and

    (b) anything done by or in relation to the person who without the modification became entitled or subject in accordance with the scheme to any property, rights or liabilities had, so far as relating to the property, rights or liabilities to which another person becomes entitled or subject in consequence of the modification, been done by or in relation to that other person.

    (2) If, in a case falling within sub-paragraph (1), the transfer scheme, as originally made, was a preparatory scheme, the scheme as modified shall be taken to be a preparatory scheme, whether or not any company which was a wholly-owned subsidiary of the BBC at the time when the preparatory scheme took effect remains a wholly-owned subsidiary of the BBC at the time when the modification takes effect.
    Orders
    28. —(1) The Secretary of State shall not make an order under this Schedule in relation to any transferee under a transfer scheme except—

    (a) with the consent of the Treasury;

    (b) after consultation with the BBC; and

    (c) if the transferee is not a wholly-owned subsidiary of the BBC, after consultation with the transferee.

    (2) Any power of the Secretary of State to make an order under this Part of this Schedule—

    (a) shall be exercisable by statutory instrument; and

    777

    (b) shall include power to make different provision for different cases, including different provision in relation to different assets or descriptions of assets.'. —[Mr. Wood.]

    Brought up, read the First and Second time, and added to the Bill.

New schedule 3

  TRANSFER SCHEMES RELATING TO THE BBC TRANSMISSION NETWORK: SUCCESSOR COMPANIES
  Interpretation
  1. —(1) In this Schedule—
  "the Charter" means the Royal Charter of 1st May 1996 for the continuance of the British Broadcasting Corporation;
  "preparatory scheme" means a transfer scheme whose main purpose is to provide for a transfer of property, rights or liabilities from the BBC to a wholly-owned subsidiary of the BBC;
  "successor company" means a company to which property, rights or liabilities are transferred in accordance with a preparatory scheme at a time when the company is a wholly-owned subsidiary of the BBC;
  "transfer" includes—

  (a) any transfer effected by or under an agreement or instrument entered into or executed in pursuance of an obligation imposed by a provision contained in a preparatory scheme by virtue of paragraph 2(1)(g) of Schedule 5;

  (b) the creation of interests, rights or liabilities by or under any such agreement or instrument; and

  (c) the creation of interests, rights or liabilities by virtue of any provision contained in a preparatory scheme by virtue of paragraph 2 of Schedule 5;

  and references to a transfer in accordance with a preparatory scheme shall be construed accordingly;
  "wholly-owned subsidiary" has the meaning given by section 736 of the Companies Act 1985.
  (2) Any reference in this Schedule to vesting in accordance with a preparatory scheme or vesting effected by a preparatory scheme shall be construed as a reference to vesting as a result of a transfer in accordance with a preparatory scheme.
  Statutory accounts
  2. —(1) The following provisions of this paragraph shall have effect for the purposes of any statutory accounts of a successor company.
  (2) The vesting in the company effected by any preparatory scheme shall be taken—

  (a) to have been effected immediately after the end of the last financial year of the BBC to end before the coming into force of the scheme, and

  (b) to have been a vesting of such property, rights and liabilities as are determined by or under the scheme.

  (3) The value of any asset and the amount of any liability which is taken by virtue of sub-paragraph (2) to have been vested in the company shall be taken to have been—

  (a) in the case where the value or amount is determined by or under the preparatory scheme, that value or amount, and

  (b) in any other case, the value or amount assigned to the asset or liability for the purposes of the Account or Accounts prepared by the BBC for the purposes of Article 18(2) of the Charter in respect of their last financial year to end before the day on which the preparatory scheme comes into force.

  (4) If an Account or Accounts are prepared by the BBC for the purposes of Article 18(2) of the Charter in respect of the residual part of a financial year, that residual part shall be treated as a financial year of the BBC for the purposes of sub-paragraph (3).
  (5) In this paragraph "statutory accounts", in relation to a company, means any accounts of that company prepared for the purposes of any provision of the Companies Act 1985 (including group accounts).
  Distributable reserves
  3. —(1) Where statutory accounts of a successor company prepared as at any time would show the company as having net assets in excess of the aggregate of—

  (a) its called-up share capital, and

  (b) the amount, apart from any property, rights and liabilities transferred to it in accordance with any preparatory scheme, of its undistributable reserves,

  then, for the purposes of section 263 of the Companies Act 1985 (profits available for distribution) and of the preparation as at that time of any statutory accounts of the company, that excess shall be treated, except so far as the Secretary of State may otherwise direct, as representing an excess of the company's accumulated realised profits over its accumulated realised losses.
  (2) For the purposes of section 264 of the Companies Act 1985 (restriction on distribution of assets) so much of any excess of a company's net assets as falls, in accordance with a direction under this paragraph, to be treated otherwise than as representing an excess of the company's accumulated realised profits over its accumulated realised losses shall be treated (subject to any modification of that direction by a subsequent direction under this paragraph) as comprised in the company's undistributable reserves.
  (3) A direction under this paragraph may provide, in relation to any amount to which it applies, that, on the realisation (whether before or after the company in question ceases to be a wholly-owned subsidiary of the BBC) of such profits and losses as may be specified or described in the direction, so much of that amount as may be determined in accordance with the direction is to cease to be treated as mentioned in sub-paragraph (2) and is to fall to be treated as comprised in the company's accumulated realised profits.
  (4) The Secretary of State shall not give a direction under this paragraph in relation to a successor company at any time after the company has ceased to be a wholly-owned subsidiary of the BBC.
  (5) The consent of the Treasury shall be required for the giving of a direction under this paragraph.
  (6) In this paragraph—
  "called-up share capital" has the same meaning as in the Companies Act 1985;
  "net assets" has the meaning given by subsection (2) of section 264 of that Act;
  "undistributable reserves" has the meaning given by subsection (3) of that section;
  and references in this paragraph, in relation to a company, to statutory accounts are references to accounts of that company prepared in respect of any period in accordance with the requirements of that Act, or with those requirements applied with such modifications as are necessary where that period is not an accounting reference period.
  Dividends
  4.—(1) Where a distribution is proposed to be declared during any accounting reference period of a successor company which includes a transfer date or before any accounts are laid or filed in respect of such a period, sections 270 to 276 of the Companies Act 1985 (accounts relevant for determining whether a distribution may be made by a company) shall have effect as if—

  (a) references in section 270 to the company's accounts or to accounts relevant under that section, and

  (b) references in section 273 to initial accounts,

  779
  included references to such accounts as, on the assumptions stated in sub-paragraph (2), would have been prepared under section 226 of that Act in respect of the relevant year (in this paragraph referred to as "the relevant accounts").
  (2) Those assumptions are—

  (a) that the relevant year had been a financial year of the successor company,

  (b) that the vesting in accordance with the preparatory scheme had been a vesting of all the property, rights and liabilities transferred to the company in accordance with that scheme and had been effected immediately after the beginning of that year,

  (c) that the value of any asset and the amount of any liability of the BBC vested in the successor company in accordance with the preparatory scheme had been the value or (as the case may be) amount determined by or under the scheme or (if there is no such determination) the value or amount assigned to the asset or liability for the purposes of the Account or Accounts prepared by the BBC for the purposes of Article 18(2) of the Charter in respect of their financial year immediately preceding the relevant year,

  (d) that any securities of the successor company issued or allotted before the declaration of the distribution had been issued or allotted before the end of the relevant year, and

  (e) such other assumptions (if any) as may appear to the directors of the successor company to be necessary or expedient for the purposes of this paragraph.

  (3) If an Account or Accounts are prepared by the BBC for the purposes of Article 18(2) of the Charter in respect of the residual part of a financial year, that residual part shall be treated as a financial year of the BBC for the purposes of sub-paragraph (2)(c).
  (4) The relevant accounts shall not be regarded as statutory accounts for the purposes of paragraph 2.
  (5) In this paragraph—
  "accounting reference period" has the meaning given by section 224 of the Companies Act 1985;
  "complete financial year" means a financial year ending with 31st March;
  "the relevant year", in relation to any transfer date, means the last complete financial year ending before that date;
  "a transfer date", in relation to a successor company, means the date of the coming into force of any preparatory scheme in accordance with which property, rights or liabilities are transferred to that company.
  Application of the Trustee Investments Act 1961
  5. —(1) For the purpose of applying paragraph 3(b) of Part IV of Schedule 1 to the Trustee Investments Act 1961 (which provides that shares and debentures of a company shall not count as wider-range and narrower-range investments respectively within the meaning of that Act unless the company has paid dividends in each of the five years immediately preceding that in which the investment is made) in relation to investment in shares or debentures of a successor company during the calendar year in which the transfer date falls ("the first investment year") or during any year following that year, the successor company shall be deemed to have paid a dividend as there mentioned—

  (a) in every year preceding the first investment year which is included in the relevant five years, and

  (b) in the first investment year, if that year is included in the relevant five years and the successor company does not in fact pay such a dividend in that year.

  (2) In sub-paragraph (1)—
  "the relevant five years" means the five years immediately preceding the year in which the investment in question is made or proposed to be made;
  "the transfer date", in relation to a successor company, means the first date on which any preparatory scheme in accordance with which property, rights or liabilities are transferred to that company comes into force.'. —[Mr. Wood. ]
  Brought up, read the First and Second time, and added to the Bill.

New schedule 4

  AMENDMENTS OF COPYRIGHT, DESIGNS AND PATENTS ACT 1988 RELATING TO CABLE PROGRAMME SERVICES
  1. For section 73 of the Copyright, Designs and Patents Act 1988 there is substituted—
  "Reception and retransmission of broadcast in cable
  programme service
  73. —(1) This section applies where a broadcast made from a place in the United Kingdom is, by reception and immediate re-transmission, included in a cable programme service.
  (2) The copyright in the broadcast is not infringed—

  (a) if the inclusion is in pursuance of a relevant requirement, or

  (b) if and to the extent that the broadcast is made for reception in the area in which the cable programme service is provided and forms part of a qualifying service.

  (3) The copyright in any work included in the broadcast is not infringed if and to the extent that the broadcast is made for reception in the area in which the cable programme service is provided; but where the making of the broadcast was an infringement of the copyright in the work, the fact that the broadcast was re-transmitted as a programme in a cable programme service shall be taken into account in assessing the damages for that infringement.
  (4) Where—

  (a) the inclusion is in pursuance of a relevant requirement, but

  (b) to any extent, the area in which the cable programme service is provided ("the cable area") falls outside the area for reception in which the broadcast is made (''the broadcast area"),

  the inclusion in the cable programme service (to the extent that it is provided for so much of the cable area as falls outside the broadcast area) of any work included in the broadcast shall, subject to subsection (5) be treated as licensed by the owner of the copyright in the work, subject only to the payment to him by the person making the broadcast of such reasonable royalty or other payment in respect of the inclusion of the broadcast in the cable programme service as may be agreed or determined in default of agreement by the Copyright Tribunal.
  (5) Subsection (4) does not apply if, or to the extent that, the inclusion of the work in the cable programme service is (apart from that subsection) licensed by the owner of the copyright in the work.
  (6) In this section "qualifying service" means, subject to subsection (8), any of the following services—

  (a) a regional or national Channel 3 service,

  (b) Channel 4, Channel 5 and S4C,

  (c) the teletext service referred to in section 49(2) of the Broadcasting Act 1990,

  (d) the service referred to in section 57(lA)(a) of that Act (power of S4C to provide digital service), and

  (e) the television broadcasting services and teletext service of the British Broadcasting Corporation;

  and expressions used in this subsection have the same meaning as in Part I of the Broadcasting Act 1990.
  (7) In this section "relevant requirement" means a requirement imposed under—

  781

  (a) section 78A of the Broadcasting Act 1990 (inclusion of certain services in local delivery services provided by digital means), or

  (b) paragraph 4 of Part III of Schedule 12 to that Act (inclusion of certain services in diffusion services originally licensed under the Cable and Broadcasting Act 1984).

  (8) The Secretary of State may by order amend subsection (6) so as to add any service to, or remove any service from, the definition of "qualifying service".
  (9) The Secretary of State may also by order—

  (a) provide that in specified cases subsection (3) is to apply in relation to broadcasts of a specified description which are not made as mentioned in that subsection, or

  (b) exclude the application of that subsection in relation to broadcasts of a specified description made as mentioned in that subsection.

  (10) Where the Secretary of State exercises the power conferred by subsection (9)(b) in relation to broadcasts of any description, the order may also provide for subsection (4) to apply, subject to such modifications as may be specified in the order, in relation to broadcasts of that description.
  (11) An order under this section may contain such transitional provision as appears to the Secretary of State to be appropriate.
  (12) An order under this section shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.
  Royalty or other sum payable in pursuance of section 73(4)
  73A. —(1) An application to settle the royalty or other sum payable in pursuance of subsection (4) of section 73 (reception and re-transmission of broadcast in cable programme service) may be made to the Copyright Tribunal by the copyright owner or the person making the broadcast.
  (2) The Tribunal shall consider the matter and make such order as it may determine to be reasonable in the circumstances.
  (3) Either party may subsequently apply to the Tribunal to vary the order, and the Tribunal shall consider the matter and make such order confirming or varying the original order as it may determine to be reasonable in the circumstances.
  (4) An application under subsection (3) shall not, except with the special leave of the Tribunal, be made within twelve months from the date of the original order or of the order on a previous application under that subsection.
  (5) An order under subsection (3) has effect from the date on which it is made or such later date as may be specified by the Tribunal."
  2. —(1) Section 134 of that Act (licences in respect of works included in re-transmissions) is amended as follows.
  (2) At the beginning of subsection (1) there is inserted "Subject to subsection (3A)".
  (3) After subsection (3) there is inserted—
  "(3A) This section does not apply in relation to any application under section 73A (royalty or other sum payable in pursuance of section 73(4))."
  3. In section 149 of that Act (jurisdiction of Copyright Tribunal) before paragraph (a) there is inserted—
  "(za) section 73 (determination of royalty or other remuneration to be paid with respect to re-transmission of broadcast including work);".
  4. In section 205B of that Act (jurisdiction of Copyright Tribunal under Part II) after paragraph (c) there is inserted—
  "(cc) paragraph 19 of Schedule 2 (determination of royalty or other remuneration to be paid with respect to re-transmission of broadcast including performance or recording);".
  5. For paragraph 19 of Schedule 2 to that Act there is substituted—
  "Reception and re-transmission of broadcast in cable
  programme service
  19. —(1) This paragraph applies where a broadcast made from a place in the United Kingdom is, by reception and immediate re-transmission, included in a cable programme service.
  (2) The rights conferred by Part II in relation to a performance or recording included in the broadcast are not infringed if and to the extent that the broadcast is made for reception in the area in which the cable programme service is provided; but where the making of the broadcast was an infringement of those rights, the fact that the broadcast was re-transmitted as a programme in a cable programme service shall be taken into account in assessing the damages for that infringement.
  (3) Where—

  (a) the inclusion is in pursuance of a relevant requirement, but

  (b) to any extent, the area in which the cable programme service is provided ("the cable area") falls outside the area for reception in which the broadcast is made ("the broadcast area"),

  the inclusion in the cable programme service (to the extent that it is provided for so much of the cable area as falls outside the broadcast area) of any performance or recording included in the broadcast shall, subject to sub-paragraph (4), be treated as licensed by the owner of the rights conferred by Part II in relation to the performance or recording, subject only to the payment to him by the person making the broadcast of such reasonable royalty or other payment in respect of the inclusion of the broadcast in the cable programme service as may be agreed or determined in default of agreement by the Copyright Tribunal.
  (4) Sub-paragraph (3) does not apply if, or to the extent that, the inclusion of the work in the cable programme service is (apart from that sub-paragraph) licensed by the owner of the rights conferred by Part II in relation to the performance or recording.
  (5) The Secretary of State may by order—

  (a) provide that in specified cases sub-paragraph (2) is to apply in relation to broadcasts of a specified description which are not made as mentioned in that sub-paragraph, or

  (b) exclude the application of that sub-paragraph in relation to broadcasts of a specified description made as mentioned in that sub-paragraph.

  (6) Where the Secretary of State exercises the power conferred by sub-paragraph (5)(b) in relation to broadcasts of any description, the order may also provide for sub-paragraph (3) to apply, subject to such modifications as may be specified in the order. in relation to broadcasts of that description.
  (7) An order under this paragraph may contain such transitional provision as appears to the Secretary of State to be appropriate.
  (8) An order under this paragraph shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.
  (9) Expressions used in this paragraph have the same meaning as in section 73."
  6. After paragraph 19 of Schedule 2 to that Act there is inserted—
  "19A. —(1) An application to settle the royalty or other sum payable in pursuance of sub-paragraph (3) of paragraph 19 may be made to the Copyright Tribunal by the owner of the rights conferred by Part 11 or the person making the broadcast.
  (2) The Tribunal shall consider the matter and make such order as it may determine to be reasonable in the circumstances.
  (3) Either party may subsequently apply to the Tribunal to vary the order, and the Tribunal shall consider the matter and make such order confirming or varying the original order as it may determine to be reasonable in the circumstances.

  783
  (4) An application under sub-paragraph (3) shall not, except with the special leave of the Tribunal, be made within twelve months from the date of the original order or of the order on a previous application under that sub-paragraph.
  (5) An order under sub-paragraph (3) has effect from the date on which it is made or such later date as may be specified by the Tribunal.".'. —[Mr. Wood. ]
  Brought up, read the First and Second time, and added to the Bill.
  Madam Deputy Speaker: New schedule 1 and amendment (a) are not moved.

Clause 1

  MULTIPLEX SERVICES AND DIGITAL PROGRAMME SERVICES
  Mr. Sproat: I beg to move amendment No. 173, in page 2, line 5, after 'programmes' insert
  '(together with any ancillary services, as defined by section 22(2))'.
  Madam Deputy Speaker: With this, it will be convenient to discuss the following amendments: Government amendments Nos. 174 to 176.
  No. 143, in clause 8, page 9, line 4, after
  'services', insert 'and digital additional services'.
  Government amendments Nos. 177 to 180 and 182.
  No. 142, in clause 12, page 11, leave out lines 38 to 41.
  Government amendment No: 183.
  No. 144, in page 12, line 9, after
  'services', insert 'and digital additional services'.
  No. 145, in page 12, leave out lines 14 to 21.
  Government amendments Nos. 184 to 192, 14 to 16, 193, 17, 194 to 202, 18, 203, 207 to 211, 19 and 212 to 215.
  Mr. Sproat: There are many amendments and changes in this group of amendments and I assure the House that I do not aim to speak at such length again during further consideration of the Bill.
  I announced on the final day of Committee that the Government intended to end the current practice of advertising on ancillary services, following representations that my Department had received from the Independent Television Commission. Owing to the point we had reached in the Bill's passage, my announcement in Committee had to serve as the most effective means of alerting the ITV companies, Channel 4 and others to our thinking on the analogue regulation of ancillary services. My announcement has enabled the ITV companies, Channel 4 and other interests to make their views known to me on this issue and I met Mr. Leslie Hill, the chairman of the ITV Association last week, to discuss it.
  In the light of my discussions with the ITVA, I am persuaded that, on balance, we should not impose new regulatory controls in this area. The ITVA assures me that it regards the limited advertising that it carries on ancillary services as an adjunct to the services that it offers advertisers who purchase spot-advertising broadcasts in commercial breaks between programmes. Given that the ITC has the power to regulate this activity and to tighten
  784
  its current guidelines, if it believes that the distinction that I have outlined is being abused, I have decided not to pursue the matter.
  This large group of amendments adjusts the provisions of the Bill with regard largely to additional and ancillary services. Amendments Nos. 183, 185, 187, 188, 191, 194, 208 to 211 and 213 provide that ancillary services, electronic programme guides and conditional access data for television or radio programmes should not be counted towards the 10 per cent. limit for additional services. However, electronic programme guides will still need an additional services licence. Amendments Nos. 173 and 195 put it beyond doubt that digital ancillary services are within the scope of the regulator's general powers.
  Amendment No. 174 provides that, on television multiplexes, any service consisting wholly or mainly of still pictures will be an additional service. On radio, some additional services might be receivable either as sound or text, perhaps depending on technology in the receiver. Amendment No. 197 ensures that such services will be categorised as additional services.
  Amendments Nos. 175 and 198 allow the Government, by affirmative order, to amend the definitions of programme services, and therefore what is counted as an additional service, to take account of technological developments. Amendments Nos. 176 and 199 are technical. They ensure that the Bill does not inadvertently require local delivery service licensees to obtain a multiplex licence.
  Clause 9 allows the ITC to bundle multiplex licences, where it believes that that would be the most appropriate way to advertise them, so that they will be more commercially attractive. Amendments Nos. 177 to 180 clarify the way in which the ITC shall consider the award of multiplex licences that have been advertised in this way. The ITC had asked us to clarify the advertisements.
  Amendment No. 182 has also been made at the behest of the ITC. It allows it to include whatever aspects of a multiplex provider's technical plan it sees fit in the multiplex licence. Amendment No. 207 makes the same adjustment with provisions covering radio multiplexes.
  Amendments Nos. 192, 12, 15 and 16 tidy up arrangements for the order-making power that the Secretary of State will exercise to reserve capacity for existing broadcasters. Amendment No. 192 makes it clear that the Secretary of State may, in any order made under clause 26, provide that clauses 7 to 16 and 18 and 19, which are to do with licensing multiplexes and digital programme services, may not apply, or may be modified, with regard to certain multiplexes that are to carry existing broadcasters. That will allow us to deal with the particular circumstances of the channel 3/4 multiplex, which will be operated by the broadcasters, and the Channel 5/S4C multiplex, which will be shared with new broadcasters. The hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) has tabled an interesting amendment on that matter, which we shall come to later.
  Amendments Nos. 14, 15 and 16 clarify the terminology and purposes of clause 26(3)(c). Clause 26(3) allows the Secretary of State to provide, by order, for the ITC to vary the existing analogue licences under which channels 3, 4 and 5 provide their services. When they take up their guaranteed places and provide digital simulcasts of their analogue services, the simulcasts will be covered

  785
  by those existing licences, but some conditions of those licences will need to be varied to cover the different circumstances of the digital services.
  Amendment No. 17 corrects the definitions contained in clause 35 relating to channel 3. Amendment No. 200 reflects an undertaking that I gave in Committee. The Secretary of State may amend the simulcast requirements for national independent radio services. The amendment provides that she must consult bodies representing listeners before doing so.
  Amendment No. 201 introduces a flexibility, suggested by the Radio Authority, into the distinction between national and local radio multiplexes. It may, in certain circumstances, be desirable to provide for local radio stations to broadcast on a national radio multiplex. For example, early indications are that there may be problems in finding frequencies to provide any digital local radio in Northern Ireland. If that turns out to be the case, this provision will allow the Secretary of State to direct the Radio Authority to reserve some capacity on the national radio multiplex in Northern Ireland for such a service.
  Amendment No. 202 fulfils my commitment in Committee to the hon. Member for Ashfield (Mr. Hoon). The proposal was also made by the Radio Authority. As the Bill stands, the guaranteed radio capacity for the INR stations is what is needed to reproduce the service on digital at the same technical quality as on analogue. That ignores two factors. First, AM quality is inferior to FM quality, so it might put Virgin and Talk Radio at a disadvantage; secondly, broadcasters should be able to use DAB to improve quality. Amendment No. 202 puts that right by giving the authority discretion to take those factors into account.
  Amendment No. 18 is a simple drafting amendment. Amendment No. 203 makes it clear that in considering what capacity should be reserved for the BBC and local radio multiplexes, the Radio Authority should have regard to the likely pressure for places on the multiplex from the independent sector.
  Amendment No. 19 corrects an earlier drafting error which omitted the fine for breach of local radio multiplex licence conditions from the list of fines which could be amended by order. Amendments Nos. 214 and 215 add digital programme and digital sound programme services to the list of services carried by a local delivery—that is a cable service. Here end the Government amendments.
  I propose to respond briefly to the further amendments in this group since, as many hon. Members will know, we had detailed discussions in Committee regarding the balance that we are seeking to achieve between digital programme services and additional services. I said then, and I say again now, that while the Government believe that digital terrestrial multiplexes should be used primarily for television services, we fully recognise also that additional services may play an important part in the digital future and may help attract some customers to obtain digital receivers.
  We listened carefully to the arguments on the issue and we responded to ensure that the whole of the 10 per cent. of each multiplex that could be used for additional services is available for services that are genuinely additional and not taken up with the data that are really closely linked with programme services. That is the
  786
  purpose of amendment No. 183 and some of those grouped with it, which provide that all ancillary services, all electronic programme guides and all television conditional access data will count as part of the 90 per cent. reserved primarily for programme services.
  The amendment tabled by the hon. Member for Newham, North-East (Mr. Timms) seeks to include a variety of additional services as specific criteria for the award of multiplex licences. That is not appropriate. That does not mean that there is no scope for the ITC to take the proposals for additional services into account when awarding licences. The overarching criterion of clause 8 states that the ITC shall award licences to those proposals best calculated to promote the development of digital television broadcasting.
  Should an applicant have proposals for additional services which appear likely to be profitable and so will contribute to the viability of digital television and perhaps to a further investment in digital technology, that can be taken into account. Should proposals for additional services appear likely to attract substantial numbers of people to buy digital receivers, that too can be taken into account.
  Sir Wyn Roberts: Will my hon. Friend give way?
  Madam Deputy Speaker: The Minister has finished.
  Mr. Geoffrey Hoon: We are able to welcome these amendments, not least because, as the Minister generously conceded, many of them were suggested by Opposition Members in Committee. I should like to press the Minister a little on the Government's decision to withdraw amendment No. 21.
  The amendment arose out of a debate in Committee concerned with electronic programme guides for the new digital as well as existing analogue services. Concern was expressed in Committee that the original wording of section 48(3)(c) of the Broadcasting Act 1990 was designed to allow electronic programme guides for analogue television. Since 1990, due to the uncertainty of the legislation, channel 3 companies in particular have not proceeded with such programme guides. On the other hand, Teletext was concerned that, having secured a public teletext licence on one financial basis, any amendment to the 1990 Act might require it to continue with the arrangements on another.
  It was obvious in Committee that there was a need for greater clarification. The Minister undertook in fairly clear words to table an amendment on Report. He said:
  "Following representations that my Department received from the ITC for clarification of the Government's intentions about the matter, we have decided to make it absolutely clear, by amending the 1990 Act, that advertising should not be carried on ancillary services. We shall bring forward an amendment on Report to implement that."—[Official Report, Standing Committee D, 18 June 1996; c. 717.]
  Concern has been expressed, in particular, by Teletext, which has written to us saying that there may be serious commercial damage to the company as a result of the Government's decision to withdraw the clarification of the 1990 Act. By withdrawing the amendment, it seems that the uncertainty over the interpretation of the 1990 provision will continue. That is unsatisfactory.

  787
  I listened carefully to what the Minister said about having a meeting with Leslie Hill of the ITV Association. It is understandable that there should be concern, but I wonder whether it would have been appropriate to have a meeting with Teletext or its representatives. It appears that part of a complicated compromise, and an undertaking by the Minister in Committee, have been abandoned in the face of representations from one interested party only.
  Mr. Ted Rowlands: I do not share the line taken by my hon. Friend that the amendments were tabled without any consultation with the regional television stations. A company such as HTV would certainly have been affected, and would have made its representations before amendments were tabled. The Minister is, rightly and properly, responding to the impact that the amendments would have had on the revenues of small regional television stations.
  6.15 pm
  Mr. Hoon: I appreciate that argument, and I am not necessarily taking sides between Teletext and the channel 3 companies. Having had a discussion in Committee, where attempts were made to produce a sensible and workable compromise, what appears to have happened in the light of the Minister's undertaking is that only one argument has been addressed by the Government in their decision to withdraw the amendment. I am not saying that I would necessarily have reached a different conclusion, but, after a long and detailed discussion in Committee, it is unfortunate that the matter appears to have been resolved in this way.
  Sir Wyn Roberts: I want to follow up the point made by the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) and express my appreciation to my hon. Friend the Minister for not pursuing amendment No. 21. I listened carefully to his list of Government amendments. I attempted to intervene earlier to ask about amendments Nos. 20 and 21, which, as I understand it, would stop the ITV companies using their teletext pages in support of regional on-screen advertisements. As the hon. Member for Merthyr Tydfil and Rhymney mentioned, that would have cost HTV a significant amount, because, over the past year or so, it has invested £750,000 in providing that service to assist its advertisers. Teletext apparently does not operate in that area, so its monopoly would not be affected.
  Mr. Stephen Timms: I wish to speak to amendments Nos. 142, 143, 144 and 145, which are in my name.
  The distinction that the Bill draws between programme services and additional data services in the licensing of digital television multiplexes is unnecessary and unhelpful. The further requirement that multiplex operators will be obliged to ensure that at least 90 per cent. of their capacity comprises what are called programme services, is arbitrary. I fear that, before long, it could emerge as a substantial roadblock in the development of a United Kingdom information super-highway.
  My central amendment, No. 142, would remove that distinction and the 90 per cent. requirement. The reason for doing that is the sheer speed of technological
  788
  development. The already blurred line between programme services and other services will very quickly become non-existent.
  The Government have attempted to clarify matters, and, as far as they go, I welcome amendments Nos. 183 to 185, which include in the programme section of the multiplex all the programme-related services and relevant technical services. There is a problem in that the amendments compound the confusion. The definitions are very difficult to make, and I worry that they are vague and will be very hard to interpret.
  There is already confusion in the industry about what will fall into which definition. If I understood the Minister correctly a few moments ago, he said that electronic programme guides will belong in the 90 per cent. of programme services. I welcome that, because there has been some debate about what will happen.
  The truth is that, within a very short time, the range of transmitted information on these services will cover a seamless continuum. In the Bill, we are creating a rather clumsy boundary by dividing programming from the rest—the 90 per cent. from the 10 per cent. Very soon, that boundary will become entirely unworkable.
  My amendments are widely supported in the broadcasting and telecommunications industries. Perhaps it is not surprising that they are supported in the telecommunications industry. In a note to me about the amendments, British Telecom has stressed
  "the important contribution that the integration of broadcasting and interactivity can make—it must not be stifled through inadvertent. if well intentioned, restrictions on its development."
  I agree with that.
  The Government should know that there is strong support for these amendments from programme makers in the television industry. The ITV Association has confirmed to me today that it does not oppose the amendments, and Carlton Television has written to me to express its firm backing for them. Carlton said in its letter:
  "The ability to offer innovative services is an important feature of digital technology, and to arbitrarily restrict the capacity, may result in DTT [Digital Terrestrial Television] being significantly less attractive than other competing distribution systems."
  Mrs. Anne Campbell: I wonder if my hon. Friend is aware of the excellent electronic guide that is offered by the BBC on the Internet. It demonstrates very well how interactivity will work: it allows one to programme in available channels and one's programme preferences, and to receive daily a fully personalised list of possible viewing. That is a good example of the type of innovation that we will see in the future, to which interactivity will contribute a great deal.
  Mr. Timms: I am grateful to my hon. Friend for that excellent point. That service is exactly the type of innovative and imaginative new service that we will see growing up very rapidly. We must ensure that the regulatory framework allows the potential of digital television to grow and prosper.
  My amendments are not prescriptive or restrictive, and they do not set a minimum level for additional services. They simply allow the industry to pursue increasing convergence between broadcasting and interactive services, unhindered by arbitrary restrictions. They allow the ITC to encourage the development of a vibrant

  789
  interactive services industry—which we all want to see—overlapping and intertwined with digital television. That will hold out the prospect of all types of economic and social advantages in the years ahead.
  The amendments also remove the need to distinguish programme services from non-programme services, which will be extremely and increasingly difficult to do. For all those reasons, I commend these amendments.
  Mr. Rowlands: We are very relieved that the Government are not proceeding with their amendments. I appreciate the point made by my hon. Friend the Member for Ashfield (Mr. Hoon) that he was not taking sides, because there would have been a point to consider other than that made by the right hon. Member for Conwy (Sir W. Roberts). Not only HTV was affected; so was S4C. One had the bizarre thought that Teletext might have to provide an advertising service in Welsh, and I think that that might have defeated it.
  I should like to know about teletext's potential development, with the amount of digital space it has been offered. As I understand it, teletext is composed of graphics and no sound. With the new digital capacity, will the teletext service have some form of moving pictures and sound if there are sufficient megabytes? Will it be possible to develop CD-ROM quality?
  Mr. Gale: The fact is that Teletext has been given insufficient capacity to develop its services to the full extent, which means that very serious restraints will be imposed on the service it provides. The withdrawal of this Government amendment probably will enhance those restraints.
  Mr. Rowlands: I did not say which side I would support. I was trying to discover to what extent we are offering such a service. Presumably clearer pictures can now be developed with the given megabytes. I am not promoting the idea, but simply inquiring how far we have gone in the Bill in saying how teletext might develop.
  Mr. Sproat: I should like to tell the hon. Member for Ashfield (Mr. Hoon) that I quite agree that it is undesirable that, late in the Committee stage, we should make a series of proposals and then decide to drop them. What happened—there is no criticism of anyone in this—is that, in the middle of the Committee stage, we received from the ITC proposals that we should act on teletext, as I described to the Committee. That was the first opportunity that I had to tell the Committee, and I did so.
  I subsequently received representations. Companies such as HTV would have been severely hit, as my right hon. Friend the Member for Conwy (Sir W. Roberts) has said. I was struck by the force of their arguments, and I invited the ITV Association to come to see me. My officials also heard the arguments of Teletext Ltd. It became clear in the course of those discussions—the majority of which I attended—that a serious under-estimate of the amount of advertising received by small companies had been made.
  Therefore, I decided—on balance, having listened to the ITVA and having heard what Teletext Ltd. had to say—that we should withdraw our proposals. Obviously
  790
  the ITC will monitor the situation very closely. However, I am satisfied that, on balance, we did the right thing in allowing particularly the smaller stations to maximise their income from this source.
  To answer the specific question of the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands), the teletext cannot be moving.
  Amendment agreed to.
  Amendments made: No. 174, in page 2, line 8, leave out from 'service' to end of line 12 and insert—
  `(b) a teletext service, or
  (c) any service in the case of which the visual images to be broadcast do not consist wholly or mainly of images capable of being seen as moving pictures,
  except, in the case of a service falling within paragraph (b) or (c), to the extent that it is an ancillary service.'.
  No. 175, in page 2, line 12, at end insert—
  '(4A) The Secretary of State may, if having regard to developments in broadcasting technology he considers it appropriate to do so, by order amend the definition of "digital programme service" in subsection (4).
  (4B) No order under subsection (4A) shall be made unless a draft of the order has been laid before and approved by a resolution of each House of Parliament.'
  No. 176, in page 2, line 14, leave out `by satellite' and insert—

  '(a) by satellite, or

  (b) in the provision of a local delivery service (as defined by section 72(1) of the 1990 Act)'.—[Mr. Wood.]

Clause 2

  MEANING OF "INDEPENDENT ANALOGUE BROADCASTER" AND "QUALIFYING SERVICE"
  Amendments made: No. 56, in page 2, line 21, leave out lines 21 to 23 and insert—
  '(d) the public teletext provider,'.
  No. 57, in page 2, line 24, leave out 'subsection (4)' and insert 'subsections (4) and (4A)'.
  No. 58, in page 2, line 27, leave out `(c) or (d)' and insert 'or (c)'.
  No. 59, in page 2, line 36, at end insert 'and'
  No. 60, in page 2, line 37, leave out from '5' to end of line 38.
  No. 61, in page 2, line 42, at end insert—
  '(4A) If—

  (a) the public teletext provider notifies the Commission, within the period of one month beginning with the commencement of this section, of his intention to provide a teletext service for broadcasting in digital form, and

  (b) the Commission consent under section (The qualifying teletext service) to his provision of that service,

  that service (in this Part referred to as "the qualifying teletext service") shall be a qualifying service for the purposes of this Part.
  (4B) In this Part "public teletext provider" means the person who holds the additional services licence (within the meaning of Part I of the 1990 Act) which relates to the teletext service referred to in section 49(2) of that Act.'—[Mr. Wood.]

Clause 3

  LICENCES UNDER PART I
  Mr. Austin Mitchell: I beg to move amendment No. 268, in page 3, line 31, at end insert
  'which shall not be given until the licence has been publicly advertised and the Commission has assessed the existing provision against alternative bidders'.
  Madam Deputy Speaker: With this, it will be convenient to discuss amendment No. 267, in clause 38, page 32, line 14, at end insert
  'which shall only be given after the licence has been re-advertised, other bids invited and the Authority has compared alternative proposals to the existing provision and is satisfied that it is superior.'.
  Mr. Mitchell: My amendments are an attempt to stop the process of takeovers that has changed the shape of radio and television. The rash of takeovers in television—it has been worse in radio—was not allowed until 1990. Now Yorkshire Television has taken over Tyne Tees Television; Carlton has taken over Central; and Granada has taken over London Weekend Television.
  The rash of takeovers in radio started earlier, and now, across the country, local stations have been taken over and amalgamated into big radio chains such as GWR and EMAP. In many cases, the chains are centrally run, with centrally determined playlists and promotion patterns, while local figures have been moved around. All stations provide much the same type of service, although in different areas, with jukeboxes placed across the country—born free, but everywhere in chains.
  These developments have gone too far. My amendments are an attempt to stop further progress, although I realise that it is a belated attempt, because the takeover process has gone so far. Certainly the idea behind television—and, earlier, behind radio—was that there should be a federal system of locally based companies serving and putting roots down into the region, reflecting the region's life in its network programmes—whether Yorkshire life, northern life, or Lancashire life in "Coronation Street"—and providing centres of excellence in each area, which is important for diversity in this country There are centres of excellence in television in Leeds, Newcastle and so on, which would not otherwise exist, because there is a tendency, in such occupations, for talent to gravitate to London. All that is now being undermined; indeed, the undermining process has gone a long way. We have witnessed the rundown of Central Television in Birmingham and the way in which many companies have effectively become shell companies.
  6.30 pm
  The argument that bigger-scale companies are needed to compete in the world market is fallacious—those companies are not competing in the world market, but if they do, it must be on the excellence of their production from locally based talent, reflecting local life in the region. Scale just brings an ability to shed staff and increase profits, which is what has been happening. I do not want that process to go any further.
  My amendments would require both the Radio Authority and the ITC, when a change of control is threatened—when somebody is trying to get control
  792
  through the back door by taking over a company to which the Radio Authority or the ITC has given a licence to serve the area—to throw the whole matter back into the melting pot and allow other applicants to come forward to take up the challenge.
  It is not necessarily true that an outsider taking over an existing company can provide a better service than someone else starting anew. Therefore, the licences should be re-advertised to stop the threat of takeovers. I want the Government to pay more attention to that, rather than creating an environment in which everyone is waiting at the starting tape ready to take over companies as soon as the Bill becomes law.
  Mr. Sproat: These amendments would, in effect, lead to new competitions for the licences whenever any change in control was proposed. The present arrangements allow the regulators to look carefully at any proposed transfer, so that they can satisfy themselves that there is no transgression of the rules on media ownership, and that the person to whom the licence is to be transferred is not disqualified and is a fit and proper person. This is as it should be. The licence remains in place, and if the new controller does not comply with its conditions, the regulator has the usual enforcement procedures at his disposal.
  With that explanation, I hope that the hon. Gentleman will withdraw his amendment.
  Mr. Austin Mitchell: The Minister's explanation is not adequate. I want new competition to be allowed. However, I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.

Clause 7

  MULTIPLEX LICENCES
  Amendment made: No. 228, in page 8, line 3, leave out 'the service' and insert
  'all the multiplex services available in that area'.— [Mr. Wood.]

Clause 8

  AWARD OF MULTIPLEX LICENCES
  Amendment made: No. 229, in page 9, line 8, leave out `the service' and insert
  'all the multiplex services available in that area'.— [Mr. Wood.]

Clause 9

  POWER TO REQUIRE TWO OR MORE MULTIPLEX LICENCES TO BE GRANTED TO ONE PERSON
  Amendments made: No. 177, in page 9, line 29, leave out 'and 8(2)(c) and (e)'.
  No. 178, in page 9, line 32, leave out 'and'.
  No. 179, in page 9, line 33, leave out from beginning to 'to' and insert
  'in section 8(2), the reference in paragraph (d)'.
  No. 180, in page 9, line 35, at end insert
  'and other references to the proposed service shall have effect as references either to each of the proposed services or to all of them considered together, as the Commission consider appropriate'. —[Mr. Wood.]

Clause 11

  FAILURE TO BEGIN PROVIDING LICENSED SERVICE AND FINANCIAL PENALTIES ON REVOCATION OF LICENCE
  Mr. Sproat: I beg to move amendment No. 181, in page 10, line 34, leave out 'financial penalty' and insert
  `specified financial penalty not exceeding whichever is the greater'.
  Mr. Deputy Speaker (Sir Geoffrey Lofthouse): With this, it will be convenient to discuss Government amendments Nos. 204 to 206.
  Mr. Sproat: These amendments fulfil a commitment made in Committee. Amendment No. 181 allows the ITC discretion to levy a fine of less than £50,000 or the specified percentage of qualifying revenue, whichever is the greater, when it revokes a multiplex licence because the multiplex provider has failed to begin providing the service. Amendments Nos. 204 to 206 make the same arrangements with regard to radio multiplexes.
  Amendment agreed to.

Clause 12

  CONDITIONS ATTACHED TO MULTIPLEX LICENCE
  Amendments made: No. 182, in page 11, line 11, after `timetable' insert 'and other proposals'.
  No. 165, in page 11, line 37, at end insert 'and'.
  No. 183, in page 11, line 41, leave out 'or qualifying services' and insert
  ', qualifying services, programme-related services or relevant technical services'.—[Mr. Wood.]
  Amendment proposed: No. 166, in page 11, line 42, leave out from beginning to end of line 3 on page 12.—[Mr. Wood.]
  Question put, That the amendment be made:—
  The House divided: Ayes 282, Noes 260.

  Division No. 165]

  [6.34 pm

  AYES

  Ainsworth, Peter(East Surrey)

  Bottomley, Rt Hon Virginia

  Alexander, Richard

  Bowden, Sir Andrew

  Alison, Rt Hon Michael(Selby)

  Bowis, John

  Allason, Rupert(Torbay)

  Boyson, Rt Hon Sir Rhodes

  Amess, David

  Brandreth, Gyles

  Arbuthnot, James

  Brazier, Julian

  Arnold, Jacques(Gravesham)

  Bright, Sir Graham

  Ashby, David

  Brooke, Rt Hon Peter

  Aspinwall, Jack

  Brown, M(Brigg & Cl'thorpes)

  Atkins, Rt Hon Robert

  Browning, Mrs Angela

  Atkinson, David(Bour'mouth E)

  Bruce, Ian(South Dorset)

  Atkinson, Peter(Hexham)

  Budgen, Nicholas

  Baker, Rt Hon Kenneth(Mole V)

  Burns, Simon

  Baker, Nicholas(North Dorset)

  Burt, Alistair

  Banks, Matthew(Southport)

  Butcher, John

  Banks, Robert(Harrogate)

  Butler, Peter

  Bates, Michael

  Butterfill, John

  Batiste, Spencer

  Carlisle, John(Luton North)

  Bellingham, Henry

  Carlisle, Sir Kenneth(Lincoln)

  Bendall, Vivian

  Carttiss, Michael

  Beresford, Sir Paul

  Cash, William

  Body, Sir Richard

  Channon, Rt Hon Paul

  Bonsor, Sir Nicholas

  Chapman, Sir Sydney

  Booth, Hartley

  Clappison, James

  Boswell, Tim

  Clark, Dr Michael(Rochford)

  Bottomley, Peter(Eltham)

  Clarke, Rt Hon Kenneth(Ru'clif)

  794

  Coe, Sebastian

  Hogg, Rt Hon Douglas(G'tham)

  Colvin, Michael

  Horam, John

  Congdon, David

  Hordem, Rt Hon Sir Peter

  Coombs, Anthony(Wyre For'st)

  Howard, Rt Hon Michael

  Coombs, Simon(Swindon)

  Howell, Rt Hon David(G'dford)

  Cope, Rt Hon Sir John

  Howell, Sir Ralph(N Norfolk)

  Cormack, Sir Patrick

  Hughes, Robert G(Harrow W)

  Couchman, James

  Hunt, Rt Hon David(Wirral W)

  Cran, James

  Hunt, Sir John(Ravensbourne)

  Currie, Mrs Edwina(S D'by'ire)

  Hunter, Andrew

  Curry, David(Skipton & Ripon)

  Hurd, Rt Hon Douglas

  Davies, Quentin(Stamford)

  Jack, Michael

  Day, Stephen

  Jackson, Robert(Wantage)

  Deva, Nirj Joseph

  Jenkin, Bernard

  Devlin, Tim

  Jessel, Toby

  Dorrell, Rt Hon Stephen

  Johnson Smith, Sir Geoffrey

  Douglas—Hamilton, Lord James

  Jones, Gwilym(Cardiff N)

  Dover, Den

  Jones, Robert B(W Hertfdshr)

  Duncan, Alan

  Jopling, Rt Hon Michael

  Duncan Smith, Iain

  Kellett—Bowman, Dame Elaine

  Dunn, Bob

  Key, Robert

  Durant, Sir Anthony

  King, Rt Hon Tom

  Dykes, Hugh

  Kirkhope, Timothy

  Eggar, Rt Hon Tim

  Knight, Mrs Angela(Erewash)

  Elletson, Harold

  Knight, Rt Hon Greg(Derby N)

  Emery, Rt Hon Sir Peter

  Knight, Dame Jill(Bir'm E'st'n)

  Evans, David(Welwyn Hatfield)

  Knox, Sir David

  Evans, Jonathan(Brecon)

  Kynoch, George(Kincardine)

  Evans, Nigel(Ribble Valley)

  Lait, Mrs Jacqui

  Evans, Roger(Monmouth)

  Lamont, Rt Hon Norman

  Evennett, David

  Lawrence, Sir Ivan

  Faber, David

  Legg, Barry

  Fabricant, Michael

  Lennox—Boyd, Sir Mark

  Fenner, Dame Peggy

  Lester, Sir James(Broxtowe)

  Field, Barry(Isle of Wight)

  Lidington, David

  Fishbum, Dudley

  Lloyd, Rt Hon Sir Peter(Fareham)

  Forman, Nigel

  Lord, Michael

  Forth, Eric

  Luff, Peter

  Fox, Dr Liam(Woodspring)

  Lyell, Rt Hon Sir Nicholas

  Fox, Rt Hon Sir Marcus(Shipley)

  MacGregor, Rt Hon John

  Freeman, Rt Hon Roger

  MacKay, Andrew

  French, Douglas

  Maclean, Rt Hon David

  Fry, Sir Peter

  McLoughlin, Patrick

  Gale, Roger

  McNair-Wlson, Sir Patrick

  Gallie, Phil

  Madel, Sir David

  Gardiner, Sir George

  Maitland, Lady Olga

  Garel-Jones, Rt Hon Tristan

  Major, Rt Hon John

  Garnier, Edward

  Malone, Gerald

  Gill, Christopher

  Mans, Keith

  Gillan, Cheryl

  Marland, Paul

  Goodlad, Rt Hon Alastair

  Marlow, Tony

  Goodson—Wickes, Dr Charles

  Marshall, John(Hendon S)

  Gorman, Mrs Teresa

  Marshall, Sir Michael(Arundel)

  Gorst, Sir John

  Martin, David(Portsmouth S)

  Grant, Sir A(SW Cambs)

  Mates, Michael

  Greenway, Harry(Ealing N)

  Mawhinney, Rt Hon Dr Brian

  Greenway, John(Ryedale)

  Merchant, Piers

  Griffiths, Peter(Portsmouth, N)

  Mills, Iain

  Grylls, Sir Michael

  Mitchell, Andrew(Gedling)

  Gummer, Rt Hon John Selwyn

  Mitchell, Sir David(NW Hants)

  Hague, Rt Hon William

  Monro, Rt Hon Sir Hector

  Hamilton, Rt Hon Sir Archibald

  Montgomery, Sir Fergus

  Hamilton, Neil(Tatton)

  Needham, Rt Hon Richard

  Hampson, Dr Keith

  Nelson, Anthony

  Hanley, Rt Hon Jeremy

  Neubert, Sir Michael

  Hannam, Sir John

  Newton, Rt Hon Tony

  Haselhurst, Sir Alan

  Nicholls, Patrick

  Hawkins, Nick

  Nicholson, David(Taunton)

  Hawksley, Warren

  Norris, Steve

  Hayes, Jerry

  Oppenheim, Phillip

  Heald, Oliver

  Ottaway, Richard

  Heathcoat—Amory, Rt Hon David

  Page, Richard

  Hendry, Charles

  Patee, James

  Hicks, Sir Robert

  Patnick, Sir Irvine

  Higgins, Rt Hon Sir Terence

  Pattie, Rt Hon Sir Geoffrey

  Hill, Sir James(Southampton Test)

  Pawsey, James

  795

  Peacock, Mrs Elizabeth

  Sweeney, Walter

  Porter, Barry(Wirral S)

  Sykes, John

  Porter, David(Waveney)

  Tapsell, Sir Peter

  Portillo. Rt Hon Michael

  Taylor, Ian(Esher)

  Powell, William(Corby)

  Taylor, John M(Solihull)

  Rathbone, Tim

  Taylor, Sir Teddy(Southend, E)

  Redwood, Rt Hon John

  Temple—Morris, Peter

  Renton, Rt Hon Tim

  Thompson, Sir Donald(C'er V)

  Richards, Rod

  Thompson, Patrick(Norwich N)

  Riddick, Graham

  Thornton, Sir Malcolm

  Robathan, Andrew

  Thumham, Peter

  Roberts, Rt Hon Sir Wyn

  Townend, John(Bridlington)

  Robertson, Raymond(Ab'd'n S)

  Townsend, Cyril D(Bexl'yh'th)

  Robinson, Mark(Somerton)

  Tracey, Richard

  Roe, Mrs Marion(Broxbourne)

  Tredinnick, David

  Rowe, Andrew(Mid Kent)

  Trend, Michael

  Rumbold, Rt Hon Dame Angela

  Trotter, Neville

  Ryder, Rt Hon Richard

  Twinn, Dr Ian

  Sackville, Tom

  Vaughan, Sir Gerard

  Sainsbury, Rt Hon Sir Timothy

  Viggers, Peter

  Scott, Rt Hon Sir Nicholas

  Walden, George

  Shaw, David(Dover)

  Walker, Bill(N Tayside)

  Shephard, Rt Hon Gillian

  Waller, Gary

  Shepherd, Sir Colin(Hereford)

  Ward, John

  Shepherd, Richard(Aldridge)

  Waterson, Nigel

  Shersby, Sir Michael

  Watts, John

  Sims, Sir Roger

  Wells, Bowen

  Skeet, Sir Trevor

  Whitney, Ray

  Smith, Sir Dudley(Warwick)

  Whittingdale, John

  Soames, Nicholas

  Widdecombe, Ann

  Spencer, Sir Derek

  Wggin, Sir Jerry

  Spicer, Sir James(W Dorset)

  Wilkinson, John

  Spicer, Sir Michael(S Worcs)

  Willetts, David

  Spink, Dr Robert

  Winterton, Mrs Ann(Congleton)

  Sproat, Iain

  Wood, Timothy

  Squire, Robin(Hornchurch)

  Yeo, Tim

  Stanley, Rt Hon Sir John

  Young, Rt Hon Sir George

  Steen, Anthony

  Stewart, Allan

  Tellers for the Ayes:

  Streeter, Gary

  Mr. Derek Conway and

  Sumberg, David

  Mr. Roger Knapman.

  NOES

  Abbott, Ms Diane

  Campbell, Ronnie(Blyth V)

  Adams, Mrs Irene

  Campbell—Savours, D N

  Ainger, Nick

  Canavan, Dennis

  Ainsworth, Robert(Cov'try NE)

  Cann, Jamie

  Allen, Graham

  Chidgey, David

  Anderson, Ms Janet(Ros'dale)

  Chisholm, Malcolm

  Armstrong, Hilary

  Church, Judith

  Ashton, Joe

  Clapham, Michael

  Austin—Walker, John

  Clarke, Eric(Midlothian)

  Barnes, Harry

  Clarke, Tom(Monklands W)

  Barron, Kevin

  Clelland, David

  Battle, John

  Clwyd, Mrs Ann

  Bayley, Hugh

  Coffey, Ann

  Beggs, Roy

  Cohen, Harry

  Bell, Stuart

  Connarty, Michael

  Benn, Rt Hon Tony

  Cook, Frank(Stockton N)

  Benton, Joe

  Cook, Robin(Livingston)

  Bermingham, Gerald

  Corbett, Robin

  Berry, Roger

  Corbyn, Jeremy

  Betts, Clive

  Corston, Jean

  Blair, Rt Hon Tony

  Cousins, Jim

  Blunkett, David

  Cummings, John

  Boateng, Paul

  Cunliffe, Lawrence

  Bradley, Keith

  Cunningham, Jim(Covy SE)

  Bray, Dr Jeremy

  Cunningham, Rt Hon Dr John

  Brown, Gordon(Dunfermline E)

  Cunningham, Roseanna

  Brown, N(N'c'tle upon Tyne E)

  Dafis, Cynog

  Bruce, Malcolm(Gordon)

  Dalyell, Tam

  Byers, Stephen

  Darling, Alistair

  Caborn, Richard

  Davidson, Ian

  Callaghan, Jim

  Davies, Chris(L'Boro & S'worth)

  Campbell, Mrs Anne(C'bridge)

  Davies, Rt Hon Denzil(Llanelli)

  Campbell Menzies(Fife NE)

  Davies, Ron(Caerphilly)

  796

  Davis, Terry(B'ham, H'dge H'I)

  Khabra, Piara S.

  Denham, John

  Kilfoyle, Peter

  Dewar, Donald

  Kirkwood, Archy

  Dixon, Don

  Lestor, Joan(Eccles)

  Donohoe, Brian H

  Lewis, Terry

  Dowd, Jim

  Liddell, Mrs Helen

  Eagle, Ms Angela

  Litherland, Robert

  Eastham, Ken

  Livingstone, Ken

  Etherington, Bill

  Lloyd, Tony(Stretford)

  Evans, John(St Helens N)

  Llwyd, Elfyn

  Ewing, Mrs Margaret

  Loyden, Eddie

  Fatchett, Derek

  Lynne, Ms Liz

  Faulds, Andrew

  McAllion, John

  Field, Frank(Birkenhead)

  McCartney, Ian

  Flynn, Paul

  Macdonald, Calum

  Forsythe, Clifford(S Antrim)

  McFall, John

  Foster, Rt Hon Derek

  McKelvey, William

  Foster, Don(Bath)

  Mackinlay, Andrew

  Foulkes, George

  McLeish, Henry

  Fraser, John

  Madennan, Robert

  Fyfe, Maria

  McNamara, Kevin

  Galbraith, Sam

  McWilliam, John

  Galloway, George

  Madden, Max

  Garrett, John

  Maddock, Diana

  George, Bruce

  Mahon, Alice

  Gilbert, Rt Hon Dr John

  Marek, Dr John

  Godman, Dr Norman A

  Marshall, David(Shettleston)

  Godsiff, Roger

  Marshall, Jim(Leicester, S)

  Golding, Mrs Llin

  Martin, Michael J(Springbum)

  Gordon, Mildred

  Martlew, Eric

  Graham, Thomas

  Maxton, John

  Griffiths, Nigel(Edinburgh S)

  Meacher, Michael

  Griffiths, Win(Bridgend)

  Meale, Alan

  Grocott, Bruce

  Michael, Alun

  Gunnell, John

  Michie, Bill(Sheffield Heeley)

  Hain, Peter

  Michie, Mrs Ray(Argyll & Bute)

  Hall, Mike

  Milbum, Alan

  Hanson, David

  Miller, Andrew

  Hardy, Peter

  Mitchell, Austin(Gt Grimsby)

  Harman, Ms Harriet

  Molyneaux, Rt Hon Sir James

  Harvey, Nick

  Moonie, Dr Lewis

  Hattersley, Rt Hon Roy

  Morgan, Rhodri

  Henderson, Doug

  Morley, Elliot

  Heppell, John

  Morris, Estelle(B'ham Yardley)

  Hill, Keith(Streatham)

  Morris, Rt Hon John(Aberavon)

  Hinchliffe, David

  Mowlam, Marjorie

  Hodge, Margaret

  Mudie, George

  Hoey, Kate

  Mullin, Chris

  Hogg, Norman(Cumbernauld)

  Oakes, Rt Hon Gordon

  Home Robertson, John

  O'Brien, William(Normanton)

  Hood, Jimmy

  O'Hara, Edward

  Hoon, Geoffrey

  Olner, Bill

  Howarth, Alan(Strat'rd-on-A)

  O'Neill, Martin

  Howarth, George(Knowsley North,

  Orme, Rt Hon Stanley

  Howells, Dr Kim(Pontypridd)

  Parry, Robert

  Hoyle, Doug

  Pearson, Ian

  Hughes, Kevin(Doncaster N)

  Pendry, Tom

  Hughes, Robert Aberdeen N

  Pickthall, Colin

  Hughes, Roy(Newport E)

  Pike, Peter L

  Hutton, John

  Powell, Sir Ray(Ogmore)

  lllsley, Eric

  Prentice, Bridget(Lew'm E)

  Jackson, Glenda(H'stead)

  Prentice, Gordon(Pendle)

  Jackson, Helen(Shef'ld, H)

  Primarolo, Dawn

  Janner, Greville

  Purchase, Ken

  Jenkins, Brian(SE Staff)

  Quin, Ms Joyce

  Johnston, Sr Russell

  Radice, Giles

  Jones, Barry(Alyn and D'side)

  Randall, Stuart

  Jones, Jon Owen(Cardiff C)

  Raynsford, Nick

  Jones, Lynne(B'ham S O)

  Rendel, David

  Jones, Martyn(Clwyd, SW)

  Robertson, George(Hamilton)

  Jones, Nigel(Cheltenham)

  Rogers, Allan

  Jowell, Tessa

  Rooker, Jeff

  Kaufman, Rt Hon Gerald

  Rooney, Terry

  Keen, Alan

  Ross, Ernie(Dundee W)

  Kennedy, Charles(Ross, C&S)

  Rowlands, Ted

  Kennedy, Jane(L'pool Br'dg'n)

  Salmond, Alex

  797

  Sedgemore, Brian

  Touhig, Don

  Sheerman, Barry

  Trickett, Jon

  Sheldon, Rt Hon Robert

  Tyler, Paul

  Shore, Rt Hon Peter

  Walker, Rt Hon Sir Harold

  Short, Clare

  Wallace, James

  Simpson, Alan

  Walley, Joan

  Skinner, Dennis

  Wardell, Gareth(Gower)

  Smith, Andrew(Oxford E)

  Wareing, Robert N

  Smith, Chris(Isl'ton S& F'sbury)

  Watson, Mike

  Smith, Llew(Blaenau Gwent)

  Wicks, Malcolm

  Smyth, The Reverend Martin

  Wigley, Dafydd

  Snape, Peter

  Williams, Rt Hon Alan(Sw'n W)

  Spearing, Nigel

  Williams, Alan W(Carmarthen)

  Spellar, John

  Winnick, David

  Steinberg, Gerry

  Wise, Audrey

  Stevenson, George

  Worthington, Tony

  Stott, Roger

  Wray, Jimmy

  Straw, Jack

  Wright, Dr Tony

  Sutcliffe, Gerry

  Young, David(Bolton SE)

  Taylor, Mrs Ann(Dewsbury)

  Taylor, Matthew(Truro)

  Tellers for the Noes:

  Thompson, Jack(Wansbeck)

  Mr. Greg Pope and

  Timms, Stephen

  Mr. Dennis Turner.

  Question accordingly agreed to.
  Amendments made: No. 184, in page 12, line 14, after `(1)(h)' insert—
  '(a)".
  No. 62, in page 12, line 14, leave out from 'the' to end of line 15 and insert 'qualifying teletext service'.
  No. 185, in page 12, line 15, at end insert

  `(b) "programme-related service" means any digital additional service consisting in the provision of services (apart from advertising) which—

  (i) are ancillary to the programmes included in one or more television programme services (within the meaning of Part I of the 1990 Act) and are directly related to the contents of those programmes, or

  (ii) relate to the promotion or listing of such programmes, and

  (c) "relevant technical service" means any technical service which relates to one or more digital programme services.'.—[Mr. Wood.]

Clause 19

  DURATION AND CONDITIONS OF DIGITAL PROGRAMME LICENCE
  Amendment made: No. 186, in page 19, line 30 at end insert
  `, in relation to each service provided under the licence,'.—[Mr. Wood.]

Clause 20

  CODE RELATING TO PROVISION FOR DEAF AND VISUALLY IMPAIRED
  Amendments made: No. 167, in page 20, line 47, after `services' insert 'and qualifying services'.
  No. 168, in page 21, line 5, at end insert—

  '(lA) In this section "assistance" means assistance of any of the following three kinds, namely—

  (a) subtitling for the deaf,

  (b) audio-description for the blind, and

  (c) presentation in, or translation into, sign language.

  798

  (1B) The code must require that, as from the tenth anniversary of the date of the commencement of the provision of any digital programme service, in each week—

  (a) at least 50 per cent of so much of the service as consists of programmes which are not excluded programmes in relation to subtitling for the deaf is to be accompanied by such subtitling, and

  (b) at least 10 per cent of so much of the service as consists of programmes which are not excluded programmes in relation to audio-description for the blind is to be accompanied by such audio-description.

  (IC) The code must specify—

  (a) in relation to subtitling for the deaf, those classes of programmes in relation to which the Commission consider that it would be inappropriate for the requirement in paragraph (a) of subsection (1B) to apply, and

  (b) in relation to audio-description for the blind, those classes of programmes in relation to which the Commission consider that it would be inappropriate for the requirement in paragraph (b) of that subsection to apply.

  (1D) If an order under section(Powers of Secretary of State in relation to code about provision for deaf and visually impaired)(1)(b) is in force, the code must also specify, in relation to presentation in, or translation into, sign language, those classes of programmes in relation to which the Commission consider that it would be inappropriate for the requirements specified to in the order to apply.

  (1E) In determining under subsection (1C) or (1D) whether it is appropriate for a particular requirement to apply to any class of programmes, the Commission shall have regard, in particular, to the benefit which the assistance would be likely to confer on the persons for whom it is intended and to the technical difficulty of providing it.

  (1F) In this section "excluded programme", in relation to assistance of a particular kind, means a programme falling within a class specified under subsection (1C) or (1D) in relation to assistance of that kind.

  (1G) Without prejudice to the generality of subsection (1), the code may—

  (a) require persons providing digital programme services, at any time or times before the anniversary referred to in subsection (1B), to meet specified targets in relation to subtitling for the deaf or audio-description for the blind,

  (b) require a specified percentage of so much of any digital programme service as consists of programmes which are not excluded programmes in relation to presentation in, or translation into, sign language, to be so presented or translated, and

  (c) require, in relation to assistance of any kind, a specified percentage of so much of any digital programme service as consists of excluded programmes falling within a specified class to be accompanied by assistance of that kind.

  (1H) In subsection (1G) "specified" means specified in, or determined by the Commission under, the code.

  (1J) Subsections (1B) and (1G), so far as relating to audio-description for the blind or presentation in, or translation into, sign language, shall have effect as if any reference to a digital programme service included a reference to a qualifying service.

  (1K) The Commission may determine that, for the purposes of any provision included in the code in pursuance of subsection (1B). a digital programme service provided by any person is to be treated as a continuation of a digital programme service previously provided by him.'

  No. 169, in page 21, line 6, leave out 'subsection (1)' and insert 'this section'.
  No. 170, in page 21, leave out lines 10 and 11.
  No. 171, in page 21, line 16, at end insert—
  '(4A) In this section—
  "programme" does not include an advertisement;
  "qualifying service" does not include the qualifying teletext service.'—[Mr. Wood.]

Clause 22

  DIGITAL ADDITIONAL SERVICES
  Amendments made: No. 187, in page 22, line 39, leave out 'or an ancillary service' and insert
  `, an ancillary service or a technical service.'
  No. 188, in page 22, line 41, leave out 'subsection (1)' and insert 'this Part'.
  No. 189, in page 22, line 44, leave out
  'provided by means of a teletext service'.
  No. 190, in page 23, line 1, leave out from 'which' to end of line 2 and insert—

  '(i) are ancillary to such programmes and directly related to their contents, or

  (ii) relate to the promotion or listing of such programmes.'.

  No. 191, in page 23, line 2, at end insert—
  '(3) In this Part "technical service" means a service which—

  (a) is provided for technical purposes connected with the encryption or decryption of one or more digital programme services or digital additional services, and

  (b) is of a description specified in an order made by the Secretary of State.

  (4) An order under subsection (3) shall be subject to annulment in pursuance of a resolution of either House of Parliament.'—[Mr. Wood.]

Clause 26

  PROVISION FOR BROADCASTING OF SERVICES PROVIDED BY INDEPENDENT ANALOGUE BROADCASTERS
  Mr. Rowlands: I beg to move amendment No. 250, in page 25, line 30, leave out 'one or two' and insert 'up to three'.
  Mr. Deputy Speaker: With this, it will be convenient to discuss amendment No. 251, in page 25, line 30, at end insert—
  '(2A) Provided that the Secretary of State shall exercise his power to make directions under subsection (2) above so as to secure that each of the independent analogue broadcasters mentioned in paragraphs (a) to (c) of section 2(1) either becomes the operator of the multiplex in question or is in a position to approve the operator.'.
  Mr. Rowlands: The amendments seek to amend clause 26, which empowers the Secretary of State to do what he has already stated in policy terms that he intends to do: allow channels 3 and 4 to decide who their multiplex operators will be. Thus the Government have agreed that the BBC will be its own multiplex operator, presumably through its privatised transmission system, and channels 3 and 4 will be able to make arrangements either to control or to determine who their multiplex operators will be. So all three public service broadcasters will have such a right.
  800
  In the broadcasting scene, however, there are two other public service broadcasters: the new Channel 5 and the present S4C. The Bill recognises that they are two additional public service broadcasters as they are qualifying services. The amendments empower the Secretary of State to give S4C and Channel 5 the same relationship with their multiplex operators as channels 3 and 4. I cannot see why a distinction has been made. They are public service broadcasters, exactly like channels 3 and 4, and their needs in terms of a multiplex operator are the same. I am sure that both Channel 5 and S4C have expressed to the Department their wish to collaborate and co-operate in that respect, as there could be considerable conflicts of interest between their needs and those of a commercial multiplex operator.
  In Wales, the whole of multiplex 3 will be taken up by the public service broadcasters, that is, S4C and Channel 5. In the rest of the United Kingdom, half of multiplex 3 will be taken up by Channel 5, which will be a public service broadcaster. It is therefore not unreasonable to propose that the Minister grant those two public service broadcasters the same position as he has granted to channels 3 and 4 and the BBC.
  The real worry is that a multiplex operator's commercial interests could differ greatly from the needs of both Channel 5 and S4C. Let me illustrate that by reference to Channel 5. It will be vital for Channel 5 to achieve digital status as early as possible. Under analogue arrangements, it will have an extremely restricted capacity to access viewers. I shall paint a grimmer picture of that when I present my next amendments, which dwell on the transmission problems that will arise in Wales.
  There is no doubt that Channel 5 will want to develop digital services as rapidly as possible, because only then will it be able to reach out to a much wider audience than will be available to it under analogue. It will be in Channel 5's interests to do that, but will it be in the interests of a commercial multiplex operator? Will it not be in a commercial multiplex operator's interest to extend digital services merely to the large conurbations already covered by Channel 5 analogue? There is undoubtedly a potential conflict of interests between the needs of a commercial multiplex operator and those of a public service broadcaster such as Channel 5, from next January. The same applies to S4C. It, too, is worried that a multiplex operator's commercial priorities may differ from its own, in reaching out to small audiences in sparsely populated areas. It would be all right if those two were not public service broadcasters. But they are, and they have a remit and duty to reach out as best they can to the widest possible audience. They should therefore riot be placed in a different position from that of channels 3 and 4 or the BBC.
  The amendments were designed to allow the Secretary of State to make that change. Channel 5, which must be up and running by January, hopes that the digital service will allow it to reach a much larger audience than it will be able to reach through analogue. It is worried that months could elapse before the ITC chose a multiplex operator and that that would be valuable time lost in delivering its service. S4C shares that concern.
  In Welsh terms, the whole of multiplex 3 is already dedicated to the two public service broadcasters. I appreciate that the matter is slightly more complex for the rest of the United Kingdom, because Channel 5 will take up only half the multiplex. I do not suggest that Channel 5

  801
  should control the other half of the multiplex or have a right to it, but it should at least have the right to a meaningful say and control over who the multiplex operator should be, so that the operator complements and is on the same wavelength as S4C and Channel 5 in trying to deliver their service.
  I shall not press my first amendment because, while I have been sitting here, I have reached the conclusion that it is redundant. I thought that I needed to lift the ceiling on the "one or two" mentioned in the Bill, but I now understand that, as the BBC is excluded, that would not be necessary. However, I am keen on the second of my two amendments because, in straightforward language by amendment standards, it is in line with the wish expressed to the Department by S4C and Channel 5. They should have a meaningful say on, if not control and ownership of, the multiplex operator, to help them to provide the best possible digital service and the fastest means of delivering it, not only in Wales but in the rest of the United Kingdom.
  Mr. Sproat: The hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) has made so many valuable contributions to our debates in Committee that I should like to have helped him, but I cannot give him too much comfort on this matter. I shall give him a little, however.
  S4C has been allocated half the third multiplex in Wales. That multiplex will also carry Channel 5. Half the multiplex in the rest of the United Kingdom, apart from Wales, is therefore free and open to new broadcasters. That is therefore quite a different position from that of channels 3 and 4, which between them will control all the capacity on the second multiplex, or the BBC, which will have control of the first multiplex. That is why it would not be fair to give to Channel 5 and S4C—given S4C's demi position on this—the same rights as channels 3 and 4, which will use the whole of the multiplex. I know that the hon. Gentleman understands that. That is why it would not be right to say that they must be the multiplex operators.
  However, Channel 5 and S4C are perfectly free to bid for the multiplex licence together, separately or together with others who might wish to come on to the third multiplex, or even people who do not wish to come on to the third multiplex. If their bid succeeds, they will control the multiplex licence; if it does not, they can be certain that their position on the multiplex will be safeguarded by the ITC through the licensing of the multiplex operator.
  Although Channel 5 and S4C have that guarantee and safeguard, I cannot give them the guarantee that the hon. Gentleman seeks, although I imagine that, with a guaranteed place on the multiplex in Wales, S4C will have a great influence on the multiplex operator.
  With those assurances, I hope that the hon. Gentleman will withdraw the amendment.
  Mr. Rowlands: The Minister mentioned the powers of the ITC and said that it can offer that type of assurance. As the Bill stands, will it be possible for Channel 5 and S4C to say to the ITC, "The multiplex operator that you are thinking about or suggesting, or that has made a bid, really would not be interested in doing what we need to do"? In other words, if they do not have the right to
  802
  control or operate the multiplex, will they have a de facto veto over a potentially unfriendly multiplex operator that bids for multiplex 3?
  That is extremely important because, although I partly appreciate the Minister's argument about the complicated position in the United Kingdom, where Channel 5 is only one half of the multiplex, the whole of multiplex 3 in Wales will be dedicated to two public service broadcasters, and those broadcasters have remits, duties and responsibilities. It is very important that no multiplex operator is chosen that will impede the fulfilment of the needs and wishes of a broadcasting service of the type that is represented by S4C and the new Channel 5.
  7 pm
  If the Minister can give me an assurance that, if nothing else, S4C and Channel 5 will have a de facto veto over the would-be multiplex operator, I should be happy to withdraw my amendment.
  Mr. Sproat: Although S4C would not have a veto, it will be absolutely incumbent on the multiplex operator to provide S4C with what S4C needs to fulfil its statutory requirements. To make certain of that, I shall get my Department to make an order to that effect, so that S4C will not have a multiplex operator that does not take its needs fully and properly into account. We intend that S4C should have that, and we shall ensure that it does have that.
  Sir Wyn Roberts: On timing, it is well known that the BBC and ITV, giving analogue services, will be first in the field, so they will have an advantage over competitors. Will S4C and Channel 5 have a similar advantage? Will the timing of the operation of their multiplex roughly coincide with the timing of the multiplexes that apply to ITV and the BBC?
  Mr. Sproat: The Government believe that the sooner they can get it off the ground, the better. It is up to them. There will certainly be nothing that says that multiplex 1 with the BBC or multiplex 2 with channels 3 and 4 should have priority. If the third multiplex can get its act together, there is no reason why it should be behind the others.
  Mr. Rowlands: Timing will be vital, as I shall show when we discuss my next amendment. However, I realise that amendment No. 250 is redundant, so I do not wish to press it.
  I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Amendments made: No. 192, in page 25, line 44, leave out lines 44 to 46 and insert—
  '(a) provide, in relation to any frequency to which this section applies—

  (i) that any or all of the provisions of sections 7 to 16 and sections 18 and 19 are not to apply, or are to apply with specified modifications, and

  (ii) that provisions of the order are to have effect in place of any or all of those provisions,'.

  No. 14, in page 26, line 6, leave out 'qualifying service' and insert
  'service specified in section 2(3) corresponding to the qualifying service ("the corresponding analogue service")'.
  No. 15, in line 7, leave out
  'that service in digital form'
  and insert 'the qualifying service'.
  No. 16, in line 10, leave out 'qualifying' and insert 'corresponding analogue'.—[Mr. Wood.]

Clause 28

  ADVERTISEMENTS INCLUDED IN QUALIFYING SERVICES
  Amendment made: No. 63, in page 27, line 6, after 'Authority' insert
  'or the public teletext provider'.—[Mr. Wood.]

Clause 29

  REVIEW OF DIGITAL TELEVISION BROADCASTING
  Mr. Rowlands: I beg to move amendment No. 224, in line 12, at beginning insert
  'Subject to subsection (1A) below',
  Mr. Deputy Speaker: With this, it will be convenient to discuss amendment No. 225, in page 27, line 29, at end insert—
  '(1A) The Secretary of State shall keep under separate review in relation to television services in Wales the matters specified in subparagraphs (1)(a)(i) to (iii) above; and for this purpose the Secretary of State may require the Commission, the Welsh Authority and the BBC to furnish him under paragraph (1)(b) above with separate reports on those matters as they relate to Wales.'.
  Mr. Rowlands: These amendments seek to institute a separate review for Wales on the issue of switching off analogue and switching on digital. It is especially necessary that the Welsh aspects of the development of digital services should be the subject of a separate review. Much excitement has been expressed throughout the Bill's passage about the potential of digital terrestrial broadcasting, but how many viewers in Wales will digital services reach, and—crucially—when? Those are the facts of television life in Welsh terms, which worry any of us who are interested in broadcasting or the overwhelming majority of people who view television.
  In Welsh terms, digital coverage will be physically difficult and expensive. Our services are currently delivered from six main transmitters and 187 relay stations. As I said in Committee, in Wales we have 20 per cent. of the relay stations in the United Kingdom, with 5 per cent. of the population. Going digital will therefore be expensive, and might be delayed. Such delays would cause considerable concern.
  I do not know whether the Minister has read the annexes to the ITC's consultation document on the delivery of digital services. Annexe 2 lists the transmitters and relay stations that make up the ITC's minimum requirement for anyone bidding for the service. Obviously, the ITC will require the six main transmitters, but I am astonished—I hope that the Minister will share my astonishment—that the minimum requirement that any operator seeking to develop digital services must fulfil relates to only three of the 187 relay stations. Those are Aberdare, Pontypool and Kilvey, Swansea. That means that more than 30 per cent. of the digital audience coverage will not be required by the ITC.
  804
  Such a scenario raises more serious issues relating to the switching off of analogue and the switching on of digital services in Wales. It appears that, if only the ITC's minimum requirements are met, nearly 1 million people in the Glamorgan and Gwent valleys will not have access to digital through relays.
  There is an additional complication. I speak of my own valley. I live almost next to a relay station, at Thomastown in Merthyr. The valleys receive analogue through relays from the Wenvoe transmitter. How can one switch Wenvoe off analogue and on to digital unless all the relay stations that feed off Wenvoe are tooled up to receive digital? It is an extremely difficult, complicated and worrying position; a potential nightmare.
  When viewers start to realise the problems, difficulties and delays that will be involved in delivering digital services to the four corners of our nation, there will be increasing anger and frustration. There will be considerable concern in every household if we experience such problems.
  There will be extra frustration and difficulty, because we have offered digital television as a solution to the tension that has begun to grow, especially in Gwent, as a result of the feelings of deprivation of those who do not receive Channel 4. That sentiment is expressed widely in the overwhelmingly English-speaking communities. We have said to them, "Hang on folks, you will have Channel 4 as a separate service when digital comes. The difficulties and the problems are capable of being resolved in the not too distant future. Come digital, we shall have the opportunity to have a completely separate Channel 4 service."
  The Minister has said that he has read the address by Geraint Talfan Davies, who made the point that approximately 35 per cent. of Welsh households have the opportunity to opt out of Welsh services and to connect, through the transmitter in the north-west, out of Welsh services altogether. In fact, that has already happened along many parts of the south coast and in the Newport area because people want Channel 4. It has not been good for the Welsh broadcasting scene—it has threatened its identity. Digital was supposed to be the answer. However, we are concerned that we shall not get digital services in Wales in the time scale that we had hoped if a determined effort—it will be a costly effort—is not made.
  In addition to that deprivation, there will be another in January: when the new Channel 5 starts to run, large portions of Wales will not be able to receive it. The map that I have in my hand shows which areas will not be able to receive Channel 5. People will have considerable problems receiving it, even with digital. Channel 5 has asked the Minister—he has not won his battle with the Department of Trade and Industry, if I can describe it in those terms—whether it can have channel 35 to extend its scope. Channel 5 is searching for frequencies that might deliver its service to a wider audience.
  Potentially, we shall find ourselves incapable of switching from analogue to digital in the time scale that many other parts of the country will be able to meet. Complications and costs affect our transmission system. In addition, increasing tensions will build up over the Channel 4 issue, and they will be compounded by the inability of large parts of Wales to receive the new Channel 5 in analogue, let alone in digital.
  Sir Wyn Roberts: I am sure that the hon. Gentleman is well aware that the topography of Wales does not

  805
  readily lend itself to complete television coverage. In addition, he will be aware of the fact that many parts of Wales are still in receipt of the VHF service, when the rest of Wales happily enjoys the UHF service.
  Mr. Rowlands: I appreciate the right hon. Gentleman's knowledge in that regard—he followed those matters closely when he was a Minister in the Welsh Office. However, he will agree that there is virtually total television coverage in Wales, and that that has been provided through the relay stations. The digital services will not be provided in the time scale that we had hoped because of the cost and the considerable technical difficulties.
  On 19 June, the Committee debated new clause 36, and the Minister sent me a reply to the debate—I do not know whether he sent a letter to the other members of the Committee. He stated:
  "viewers in several parts of the country would not be able to receive Channel 5."
  He continued:
  "it remains open to Channel 5 Broadcasting Limited to supplement coverage of their licence via cable and satellite and it is only by those means that all of Wales could receive Channel 5."
  That is a serious statement, because it looks as if the vast majority of Welsh television viewers should choose either cable or satellite to get the new range of programmes and services.
  Mr. Dafis: For a considerable period, large parts of Wales will be inaccessible to cable.
  7.15 pm
  Mr. Rowlands: That is true, so satellite will be the solution. Viewers will have to decide whether to spend money on a satellite or on set-top boxes and the rest of it. That could have a profound effect on the broadcasters, who are expected to deliver digital terrestrial services throughout Wales. There will be increasing arguments as to whether we should try to deliver them by satellite or by digital terrestrial. The Minister has admitted, with regard to Channel 5, that viewers will have to turn to satellite. There will be a lot of ambivalence and ambiguity about the way in which terrestrial services are provided in Wales.
  Even bigger questions will be raised. For example, if people become totally dependent on satellite, what will happen when security issues arise? I do not want to forecast a war, but during such a crisis, the quality of the terrestrial services is not usually affected. However, viewers who receive their television services by satellite will face serious issues in relation to national security and defence in times of crisis.
  I do not want to end my speech on that gloomy and doomsday note. I plead with the Minister to carry out the review. Every conceivable pressure should be put on multiplex operators to go out and deliver—no matter how difficult and expensive it might be—the digital terrestrial services to Wales, which the rest of the United Kingdom will have in the not too distant future. If that does not happen, people's sense of being deprived of television—which has always been under the surface in many of our broadcasting debates in Wales—will grow with intensity.
  Mr. Dafis: I congratulate the Labour party Front Bench and the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) on tabling the amendments. I am not normally in a congratulatory mood in relation to the Labour party in Wales these days, but the amendments are important. As the hon. Member for Merthyr Tydfil and Rhymney has said, the designation of half a multiplex to S4C has been welcomed as a major achievement. It will provide an important resource for broadcasting in Wales, and it will benefit not only the viewers of S4C but the whole broadcasting scene in Wales.
  As we have delved into this situation, we have begun to understand the concerns in relation to the extent of coverage of Wales by digital terrestrial. We are back to what Geraint Talfan Davies identified as one of the big issues in Welsh broadcasting: transmitters. The hon. Gentleman has referred to the ITC document of 22 May which refers to potential multiplex providers. It has been suggested to me that the document is too optimistic. There are also questions about the level of competence of the document. The document includes maps that show the extent of the coverage for the first three multiplexes—A, B and C—and, as one looks at them, one sees progressively less coverage of Wales. The third is pretty disastrous so far as the coverage of Wales is concerned. A broad band of territory—it extends from north-west Wales, including most of Anglesey, through the centre of the country, to the south-east—will not get digital, unless something is done about the transmission system. That includes Cardiff—it looks as though it will not be able to access digital through the multiplex—and much of Glamorgan.
  I discussed the technical reasons for that in Committee. It seems that the existing transmitters—and the boosters to which the hon. Member for Merthyr Tydfil and Rhymney referred—do not have the capacity for digital. Their capacity is taken up entirely by the existing analogue service. That has major implications for the viability of S4C and Channel 5 in Wales and their ability to develop.
  If multiplex C—and therefore S4C—is available in the south-east only if people tune into the Mendip transmitter, that will have tremendous implications for the audiences of HTV and BBC Wales. The hon. Member for Merthyr Tydfil and Rhymney has mentioned that issue. That matter must be addressed and I ask the Minister to announce tonight what solution the Government will offer. Has he considered the matter that I raised in Committee about using microwave technology? It seems to offer a solution—it would take time and it would involve co-operation between various agencies, but it is an important area.
  I referred previously to the DTI working groups that are currently studying the new high frequencies on the 40 gigahertz microwave band. That involves using transmitters that are located every five miles—the same kind that are used for cellular phones. A complete network of such transmitters would facilitate the eventual removal of the 50 huge main transmitters throughout the United Kingdom. Those transmitters are an eyesore and they emit a great deal of electromagnetic energy.
  Another advantage of microwave technology is that the adjacent band—43 gigahertz—has been provisionally set aside for wireless interactive services, the Internet, multimedia and so on. If the Department of National Heritage cannot think of a better way of providing

  807
  coverage in Wales—if it can, we should hear about it tonight; it is important that we are confident that the Government know what they are doing in that regard—it should pursue energetically the microwave technology option. It could facilitate that through co-operation with the DTI and with the Welsh and Scottish Offices.
  I turn to another matter of concern involving the transmission of analogue services and its funding implications. I have already discussed that issue with the Minister, but I shall go over that ground again briefly. When S4C was made responsible for paying for transmission under the Broadcasting Act 1990, a miscalculation occurred—that has been clearly established—and, as a result, there was underfunding in relation to transmission costs. That was compensated for by an error in the drafting of the 1990 legislation that provided funding for S4C from 1 January. That funding more than compensated for the loss arising from the miscalculation that I have mentioned.
  This legislation will affect the 1 January funding, which will no longer apply. I understand that it cannot apply and I do not seek to change that decision. However, I am seeking a commitment from the Government that the proper level of funding—no more than that—for the transmission of analogue will be restored. It is not a matter of greed or of making unreasonable demands; it is simply a matter of normalising the funding on the basis of what was agreed in 1990.
  The Minister has sent me a letter about the matter—I am grateful to him for allowing me to quote from it. His response is important and quite promising. He says:
  "it is open to S4C—at any time—to make a case to the Secretary of State for support with their analogue transmission costs".
  That is fine—I accept the Minister's assurance and I am satisfied with it. However, he goes on to refer to S4C's opportunities for meeting the cost of the digital service. He says:
  "While we will study carefully any case S4C make to the Secretary of State for further financial assistance for transmission costs, it is only fair that I reiterate my view that the digital capacity and commercial freedoms offered by the Bill will enable the Welsh Fourth Channel Authority to raise significant sums for the benefit of their public service remit".
  That is okay, but I emphasise that those sums should be viewed as a means of enabling S4C to meet the additional demands of digitalisation. That is what they are for. I am concerned about the costs of analogue and of analogue transmission. It is clear that that will remain the primary means of providing S4C in Wales for many years. I ask the Minister to elucidate the next sentence of his letter. He says:
  "we envisage that the provisions which enable the Secretary of State to increase S4C's funding to assist transmission costs would only be used if the Welsh Fourth Channel Authority had made its case to the Department's satisfaction that it had exhausted all other sources of revenue for meeting these costs".
  The Minister seems to be saying that, if the Welsh channel could show that it had exhausted all other means, it could look for a positive response from the DNH in relation to extra funding.
  The Government have made it clear in debate both in the other place and in Committee that, by changing the basis of S4C funding to the retail prices index, they intend to provide stability of funding—they do not intend to cause any reduction. "Stability" implies a process whereby S4C could go to the DNH on the basis of a clear
  808
  understanding of its financial position and prospects in the confident expectation that its requests would meet with a positive response. That is what "stability" implies to me.
  If the Minister does not mean that and if S4C would fail to receive funding in those circumstances, it is important to understand that S4C would face a significant funding cut. That is the reality and we might as well face it—S4C would have a reduced capacity to meet its programming obligations under the analogue system. In order to facilitate planning and stable provision, I seek confirmation from the Minister that, if and when that situation arises, S4C will receive a positive response.
  Mr. Sproat: The amendments would introduce special arrangements for Wales in the review of prospects for analogue switch-off, but that is unnecessary. The review that we propose—as set out clearly in clause 29—encompasses the whole of the United Kingdom. The key factor in determining a timetable for analogue switch-off will be the availability, in digital form, of the public service channel to all viewers, wherever they may live. The availability of the services to people in Wales will be as important as their availability elsewhere in the United Kingdom. There is no need to make extra, special provisions for any part of the United Kingdom because the whole of the United Kingdom will be considered in the review. That is the short and straightforward answer, but I understand why the hon. Members for Merthyr Tydfil and Rhymney (Mr. Rowlands) and for Ceredigion and Pembroke, North (Mr. Dafis), who educated me in Committee on certain aspects of the Bill, have—quite properly—used the debate to raise one or two wider questions.
  On the question of coverage, ITC frequency planning is not yet complete. The ITC will ask the applicants to operate channel 35 to make clear their plans for the time when more relay will be available.
  7.30 pm
  Mr. Rowlands: I am worried because the ITC is making such a minimum initial demand. Why does not it make a much greater demand and let the operators prove that they cannot reach that demand? The ITC will do the reverse and tell operators the minimum they have to do, but ask them to let it know if they can do more. That is the wrong way round.
  Mr. Sproat: The ITC does not agree with the hon. Gentleman, but he is at liberty to suggest that it is not asking enough. I shall draw his comments to its attention, but it has considered the point and believes that its way will be best.
  Mr. Dafis: The problem is that if the ITC asked for the use of all the main transmitters and all the relays, it would have difficulty in providing transmission because there is not enough space or frequencies on those transmitters and boosters to provide digital alongside analogue. As soon as analogue is switched off everything will be fine, but some people will not have a digital set and they will not receive any television broadcasts. That is an important gap.
  Mr. Sproat: Analogue will not be switched off until an equivalent bulk of the population is capable of receiving digital. I enunciated that principle many times in Committee and it will be the basis for any switch-off.

  809
  The hon. Member for Merthyr Tydfil and Rhymney asked about channel 35 and its effect on Channel 5. Of course, I am aware that the ITC has proposed that channel 35 should be available to Channel 5. We are considering that point urgently with colleagues at the Department of Trade and Industry and my hon. Friend the Minister for Science and Technology is in his place and will have heard the hon. Gentleman's comments. My hon. Friend the Member for North Thanet (Mr. Gale) said in Committee that he was in favour of channel 35 being used to spread Channel 5 to a much wider area in the south of England and almost every part of the United Kingdom has an interest in the issue, not just Wales. I can assure hon. Members that the issue of the use of channel 35 is one that both Departments are considering closely. We are aware of the attractions of usage by Channel 5 and the other uses to which channel 35 could be put.
  The hon. Member for Ceredigion and Pembroke, North mentioned microwave bands and he properly raised that important subject in Committee. We take the subject seriously and the key determinant of analogue switch-off is the availability of the public service channels to all who wish to view them. The means by which they are received is secondary to that. If cable, satellite or other forms of transmission, such as microwave delivery, are practical, I hope that the broadcasters will explore them.
  The hon. Member for Ceredigion and Pembroke, North asked what assurance I could give about assistance for future S4C transmission costs. He will know that clause 75 will roll over into the Bill the provision in the Broadcasting Act 1990 that allows my right hon. Friend the Secretary of State to provide additional funding over and above the statutory formula funding if she is satisfied that that is necessary with regard to the costs of transmission. Indeed, it will extend the 1990 Act provision by specifying that the additional funding can cover the cost of digital as well as analogue transmission. Clearly, the exercise of any such provision will require detailed discussion with S4C about costs and alternative sources of funding, as the hon. Gentleman mentioned when he quoted from my letter. I cannot give him many guarantees about funding, if any. If S4C believes that there is a case to be made, it should make that case, with the help of the hon. Gentleman and other hon. Members, to my Department.
  I hope that, given those assurances, the amendment will be withdrawn.
  Mr. Rowlands: I hope that the worst of our worries and our gloomiest predictions will not come true. If they do, we will be back not only with a new Bill, but with new arguments and new frustrations. In the light of need to proceed with the Bill, I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Amendment made: No. 64, in page 27, line 19, after `Digital' insert 'the qualifying teletext service'.—[Mr. Sproat.]

Clause 35

  INTERPRETATION OF PART I
  Amendments made: No. 193, in page 29 line 39, at end insert—
  ' "ancillary service" has the meaning given by section 22(2);'.
  No. 17, in page 29, leave out lines 40 and 41 and insert—
  ' "a Channel 3 licence" has the same meaning as in Part I of the 1990 Act and "a Channel 3 service" means a regional or national Channel 3 service (within the meaning of that Part);'.
  No. 65, in page 30, line 9, at end insert—
  "'public teletext provider" has the meaning given by section 2(4B);'.
  No. 66, in page 30, line 10, at end insert—
  "qualifying teletext service" means the public teletext service provided by the public teletext provider for broadcasting in digital form as a qualifying service;'.
  No. 194, in page 30, line 14, at end insert—
  ' "technical service" has the meaning given by section 22(3).'.—[Mr. Sproat.]

Clause 36

  RADIO MULTIPLEX SERVICES
  Amendments made: No. 195, in page 30, line 45, after 'sound' insert
  `(together with any ancillary services, as defined by section 59(2))'.
  No. 196, in page 31, line 1, after 'include' insert—
  '(a)".
  No. 197, in page 31, line 2, at end insert
  'or
  (b) a service where the sounds are to be received through the use of coded reference to pre-defined phonetic elements of sounds.'.
  No. 198, in page 31, line 2, at end insert—
  '(5A) The Secretary of State may, if having regard to developments in broadcasting technology he considers it appropriate to do so, by order amend the definition of "digital sound programme service" in subsection (5).
  (5B) No order under subsection (5A) shall be made unless a draft of the order has been laid before and approved by a resolution of each House of Parliament.'
  No. 199, in page 31, line 4, leave out `by satellite' and insert—

  '(a) by satellite, or

  (b) in the provision of a local delivery service (as defined by section 72(1) of the 1990 Act)'.—[Mr. Sproat.]

Clause 37

  MEANING OF "INDEPENDENT NATIONAL BROADCASTER" AND "SIMULCAST RADIO SERVICE"
  Amendment made: No. 200, in page 31, line 29, at end insert—
  '(4A) Before making an order under subsection (4) the Secretary of State shall consult such persons appearing to him to represent listeners as he thinks fit.'—[Mr. Sproat.]

Clause 41

  ASSIGNMENT OF FREQUENCIES BY SECRETARY OF STATE
  Amendment made: No. 201, in page 36, line 2, at end insert—
  '(4A) References in subsection (4) to digital sound programme services of a particular character include references to digital sound programme services catering for the tastes and interests of persons living within a specified area or locality.'—[Mr. Sproat.]

Clause 44

  RESERVATION OF CAPACITY FOR INDEPENDENT NATIONAL BROADCASTERS
  Amendments made: No. 202, in page 39, line 9, leave out from 'which' to end of line 12 and insert
  `the Authority consider appropriate in all the circumstances for the broadcasting of that service'.
  No. 18, in page 39, line 13, leave out 'this section' and insert 'subsection (1)'.—[Mr. Sproat.]|

Clause 45

  DUTY OF AUTHORITY TO RESERVE DIGITAL CAPACITY FOR CERTAIN PURPOSES OF BBC
  Amendment made: No. 203, in page 40, leave out lines 1 to 4 and insert—
  '(2) The circumstances to which the Authority may have regard in performing their duty under subsection (1) include the likely demand for digital capacity by persons providing or proposing to provide local digital sound programme services.'—[Mr. Sproat.]

Clause 49

  FAILURE TO BEGIN PROVIDING LICENSED SERVICE AND FINANCIAL PENALTIES ON REVOCATION OF LICENCE
  Amendments made: No. 204, in page 44, line 2, at end insert
  `a specified financial penalty not exceeding'.
  No. 205, in page 44, line 3, leave out
  `a financial penalty of.
  No. 206, in page 44, line 5, leave out 'a financial penalty of'.—[Mr. Sproat.]

Clause 50

  CONDITIONS ATTACHED TO NATIONAL OR LOCAL RADIO MULTIPLEX LICENCE
  Amendments made: No. 207, in page 44, line 28, after `timetable' insert 'and other proposals'.
  No. 208, in page 45, line 18, leave out `or simulcast radio services' and insert
  ', simulcast radio services, programme-related services or relevant technical services.
  (1A) In paragraph (1)(h)—

  (a) "programme-related service" means any digital additional service consisting in the provision of services (apart from advertising) which—

  (i) are ancillary to the programmes included in one or more digital sound programme services, simulcast radio services or local or national services (within the meaning of Part I of the 1990 Act) and are directly related to the contents of those programmes, or

  (ii) relate to the promotion or listing of such programmes, and

  812

  (b) "relevant technical service" means any technical service which relates to one or more digital sound programme services.'—[Mr. Sproat.]

Clause 59

  DIGITAL ADDITIONAL SERVICES
  Amendments made: No. 209, in page 56, leave out line 21 and insert—
  ', an ancillary service or a technical service'.
  No. 210, in page 56, leave out lines 22 to 28 and insert—
  '(2) In this Part "ancillary service" means any service which is provided by the holder of a digital sound programme licence or by an independent national broadcaster and consists in the provision of any service (other than advertising) which—

  (a) is ancillary to programmes included in a digital sound programme service or simulcast radio service provided by him and is directly related to their contents, or

  (b) relates to the promotion or listing of such programmes.'

  No. 211, in page 56, line 28, at end insert—
  '(3) In this Part "technical service" means a service which—

  (a) is provided for technical purposes connected with the encryption or decryption of one or more digital sound programme services or digital additional services, and

  (b) is of a description specified in an order made by the Secretary of State.

  (4) An order under subsection (3) shall be subject to annulment in pursuance of a resolution of either House of Parliament.'—[Mr. Sproat.]

Clause 65
  POWER TO VARY AMOUNT OF FINANCIAL PENALTIES
  Amendment made: No. 19, in page 60, line 17, at end insert 'and (4)'.—[Mr. Sproat.]
Clause 68

  INTERPRETATION OF PART II
  Amendments made: No. 212, in page 61, line 22, at end insert—
  ' "ancillary service" has the meaning given by section 59(2)'.
  No. 213, in page 61, line 46, at end insert—
  ' "technical service" has the meaning given by section 59(3).'.—[Mr. Sproat.]

Schedule 2

  AMENDMENTS OF BROADCASTING ACT 1990 RELATING TO RESTRICTIONS ON HOLDING OF LICENCES
  Amendment proposed: No. 232, in page 113, line 28, at end insert—
  `(ee) in the definition of "participant", after "means" there is inserted "(subject to sub-paragraph (5A))".'.—[Mr. Maclennan.]
  Mr. Deputy Speaker (Mr. Michael Morris): With this, it will be convenient to discuss the followmg amendments: No. 230, in page 114, line 1, leave out `secure' and insert 'achieve the result'.
  No. 231, in page 114, leave out lines 3 to 8 and insert—
  `(c) he is a party to an arrangement (including any undertaking, expectation or understanding), whether or not legally binding, whereby parties to the arrangement, whether or not including himself, who hold or are beneficially entitled to 50 per cent. or more of the equity share capital of the body in aggregate or 50 per cent. or more of the voting power in it in aggregate make provision as to the manner or circumstances in which any voting power in the body possessed by any of them is to be exercised or not exercised either generally or in relation to any specified matters.'.
  No. 233, in page 114, line 19, at end insert—
  '(5A) After sub-paragraph (5) there is inserted
  "(5A) For the purposes of this Schedule a person shall not be regarded as a participant in relation to a body corporate by reason only that his interest in shares in that body is—

  (a) that of a bare trustee;

  (b) that of a simple trustee (where such shares are held on trust according to the law of Scotland); or

  (c) an exempt custodian interest within the meaning of section 209(4) of the Companies Act 1985." '.

  Mr. Sproat: Given the marvellous brevity of the hon. Member for Caithness and Sutherland (Mr. Maclennan), I shall begin with some good news for the Opposition, which is good news for us on the Bill. Our legal advisers are of the opinion that there is little to choose between the current formulation, using the word "secure", and one that uses the words able to "achieve", as proposed by amendment No. 230. In legal and policy terms they produce the same result. In the light of the legal opinion that we have received, and given the continuing concern expressed by the regulators, the Government will not oppose amendment No. 230.
  Amendment No. 231 would bolster the provisions inserted in the Bill in Committee that deal with "joint control" and "deadlocking". As it stands, the Bill will, without doubt, catch cases where two companies each have a 50 per cent. stake in the deadlocked company. However, concern has been expressed about a case where, for example, company A and company B each hold a 49 per cent. interest, while 1 per cent. is held by another company that can be relied on to follow the wishes of company A and 1 per cent. by a company that can be relied on to follow the wishes of company B. Such a case could be caught by the substituted paragraph 1(3)(c) on page 114 of the Bill, as amended in Committee, if the 1 per cent. shareholders could each be regarded as nominees within the meaning of part I to schedule 2 to the 1990 Act. Such a situation could also be caught by paragraph 1(3)(b) if it was thought likely—in the sense of "reasonable expectation"—that A and B would be acting in accordance with each other's wishes. This is because if A and B were acting together, it would be reasonable to expect that they would be able to secure that the company's affairs would be conducted in accordance with their joint wishes. The 2 per cent. part shareholding would be completely irrelevant in company law terms unless allied with A or B.
  As it stands, amendment No. 231 would treat each of the parties to the arrangement as controlling the company. That could produce some unwelcome, and possibly even absurd, results. It would clearly be wrong to catch the many legitimate and commonplace arrangements that may be entered into among shareholders in private or family companies to secure their position within the company.
  814
  For example, if a 5 per cent. shareholder had entered into an agreement with other shareholders speaking for 51 per cent. of the voting power purely to safeguard his representation on the board of directors—which would be "any specified matter" within the meaning of the ITC's amendment—it would be contrary to principle and common sense to treat him as controlling the company. For those reasons, the Government will not accept amendment No. 231.
  Amendments Nos. 232 and 233 would prevent those who simply hold shares on behalf of others from being caught by the ownership provisions in schedule 2. They would ensure that such shareholders are not caught by the definition of the participant that now appears in the Bill. However, in so far as that is the intention of amendment Nos. 232 and 233, I understand that they are technically defective. They carve out an exemption for the purpose of limiting stakes in licences, but they do not do so in other respects. If the amendments were passed, such nominee or custodian trustees could still be deemed to control licences for other purposes and to be connected persons or "associates" of licence holders. In lay terms, they would be excluded from some of the ownership restrictions, but would still be included in others. To accept the amendments as they are could be to subvert, albeit unintentionally, the scheme of schedule 2. For that reason, and as I have agreed to amendment No. 230, I hope that the hon. Gentleman will withdraw his other amendment.
  Mr. Maclennan: I am grateful to the Minister for explaining in some detail, as I think is appropriate, the Government's reasons for not wishing to accede entirely to the views of the ITC on the matter. I have no doubt that his legal advice will be studied with great care. I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Amendment made: No. 230, in page 114, line 1, leave out 'secure' and insert 'achieve the resulf.—[Mr. Sproat.]
  Mr. Sproat: I beg to move amendment No. 22, in page 114, line 30, at end insert—
  '(8) Any reference in this Schedule to a person who is over a particular age is a reference to a person who has attained that age.'.
  The amendment puts beyond any doubt the fact that any reference in schedule 2 to a person who is over a particular age means that a person has attained that age. If that formulation still mystifies hon. Members, perhaps they will give me another 10 seconds to say that the intention of that form of words is to remove an ambiguity in the current wording of paragraph 9 of part III to schedule 2, dealing with the calculation of radio points for the purposes of the 15 per cent. limit applying to the ownership of radio licences. The current wording could be interpreted as relating to persons who are not yet 16 years old, rather than to those who have reached their 15th birthday.
  Amendment agreed to.
  Mr. Sproat: I beg to move amendment No. 8, in page 116, line 13, leave out from "Act)" to end of line 15 and insert—

  '(i) a licence to provide digital programme services, or

  (j) a licence to provide national or local digital sound programme services.'

  Mr. Deputy Speaker: With this, it will be convenient to discuss Government amendments Nos. 9 and 7.
  Mr. Sproat: Amendment No. 8 honours the commitment given to my hon. Friend the Member for Hexham (Mr. Atkinson) in Committee to disapply the nationality restrictions in part II of schedule 2 to the 1990 Act in respect of the ownership of digital programme service licences.
  Amendment agreed to.
  Mr. Sproat: I beg to move amendment No. 92, in page 116, line 24, after 'BBC company' insert
  ', a Channel 4 company'.
  Mr. Deputy Speaker: With this, it will be convenient to discuss Government amendments Nos. 93 to 101.
  Mr. Sproat: The amendments fulfil our commitment to allow Channel 4 to create or participate in companies involved in broadcasting activities. This will allow Channel 4, like S4C and the BBC, to take full advantage of the opportunities of digital broadcasting.
  We are allowing Channel 4 to establish or participate in companies anywhere in the world, provided that they are involved in activities that would be licensable by the ITC or the Radio Authority if they were taking place in the United Kingdom. We are also allowing it to be involved in holding companies. These extra powers have been added to those already granted to S4C.
  Amendment No. 94 makes it clear that Channel 4 is able to broadcast its digital simulcast service throughout the United Kingdom, including Wales. On analogue, the Welsh fourth channel is, of course, the responsibility of S4C.
  Amendment agreed to.
  Amendment made: No. 9, in page 116, line 29, at end insert—
  `() A BBC company is also a disqualified person in relation to any licence granted by the Authority to provide a national, local or restricted service within the meaning of Part III of this Act.'—[Mr. Sprout.]
  Mr. Sproat: I beg to move amendment No. 23, in page 116, line 41, leave out 'paragraphs 9 and 17' and insert `paragraph 9'.
  Mr. Deputy Speaker: With this, it will be convenient to discuss Government amendments Nos. 35, 38, 41 and 42.
  Mr. Sproat: The amendments arise as a result of the new regime for limiting participation, short of control, in broadcasting licences. As a result of these changes, paragraphs 16 to 21 of part III to schedule 2 are largely redundant, and are therefore deleted by amendment No. 42.
  The holder of a licence to provide a national channel 3 or Channel 5 service is currently limited to a maximum interest of 20 per cent. in a national radio service and vice
  816
  versa. The holder of a licence to provide local digital sound programme services or a local radio service is currently limited to a maximum interest of 20 per cent. in a regional channel 3 licence holder where each of the services covers an area that is to a significant extent the same, and vice versa.
  Amendment No. 35 replaces these restrictions with restrictions on common control, but does not impose restrictions on the extent of participation below the level of control. It therefore harmonises these restrictions with the restrictions on participation that were agreed in Committee.
  Amendments Nos. 23, 38 and 41 make consequential adjustments to part III of schedule 2.
  Amendment agreed to.
  7.45 pm
  Mr. Sproat: I beg to move amendment No. 24, in page 116, line 42, leave out 'sixteen' and insert 'seventeen'.
  Mr. Deputy Speaker: With this, it will be convenient to discuss Government amendments Nos. 25, 26, 36, 37 and 158.
  Mr. Sproat: Amendments Nos. 24, 25 and 26 enable the Secretary of State, by order, to include the new category of restricted service television licences within the categories of licence that are subject to the 15 per cent. total television audience share limit.
  Amendments Nos. 36 and 37 allow the Secretary of State to limit, by order, the number of such licences that may be held by any one person.
  Amendment No. 158 allows the Secretary of State to make an order imposing restrictions on cross-ownership of restricted service television licences and newspaper companies, and to apply the public interest test to them, should this prove appropriate in the future.
  Amendment agreed to.
  Amendment made: No. 25, in page 116, line 45, at end insert—
  '(aa) restricted services (within the meaning of Part I of this Act);'.—[Mr. S'proat.]
  Amendment proposed: No. 220, in page 117, line 24, leave out from beginning to end of line 26, and insert
  `No person shall at any one time—'.—[Mr. Austin Mitchell.]
  Mr. Deputy Speaker: With this, it will be convenient to discuss the following amendments: No. 237, in page 117, line 25, leave out '15' and insert '10'.
  No. 234, in page 117, line 26, after 'not', insert 'subject to sub-paragraph (3B)'.
  No. 131, in page 117, leave out lines 44 to 49.
  No. 249, in page 117, line 46, leave out '15' and insert `10'.
  No. 221, in page 117, leave out from beginning of line 50 to end of line 14 on page 118.
  No. 235, in page 117, line 50, after 'Or, insert 'and subject to sub--paragraph (3A)'.
  No. 132, in page 118, leave out lines 1 to 4.
  No. 133, in page 118, line 7, leave out '1(2)(b)' and insert '1(2)(a), (b)'.
  No. 134, in page 118, line 9, leave out
  'more than a 20 per cent.'
  and insert 'a qualifying'.
  No. 135, in page 118, leave out lines 11 and 12.
  No. 236, in page 118, at end insert—
  `(3A) For the purposes of calculating a person's audience time in respect of any period in accordance with sub-paragraph (3):

  (a) there shall be included the audience time attributable in respect of that period to each service referred to in that sub-paragraph in respect of which, on the date upon which the calculation of his audience time for the purposes of sub-paragraph (1) is made, he holds the licence, is a participant in the body corporate which holds the licence, or which he provides (as the case may be), irrespective of whether he held the licence, or was a participant in the body corporate which holds the licence or provided the service at any time during the period; and

  (b) there shall (for the avoidance of doubt) be excluded the audience time attributable in respect of that period to each service referred to in sub-paragraph (3) in respect of which, prior to the date upon which the calculation of his audience time for the purposes of sub-paragraph (1) is made, he has ceased to hold the licence, or to be a participant in the holder of the licence, or to provide the service (as the case may be).

  (3B) Sub-paragraph (1) shall not prevent a person from continuing to hold any licence, or to be a participant in a body corporate which holds any licence, or from continuing to provide any service (as the case may be) if and to the extent that arrangements made by him after the end of period in respect of which his audience time exceeds 15 per cent of total audience time would cause his audience time calculated so as to take into account the effect of those arrangements, not to exceed 15 per cent of total audience time.'.
  No. 222, in page 118, leave out from beginning of line 23 to end of line 13 on page 119.
  No. 136, in page 118, line 27, at end insert—
  `(6) In this paragraph "qualifying interest" means an interest of more than 20 per cent.
  (7) The Secretary of State may by order amend sub-paragraph (6)—

  (a) by substituting a different percentage for any percentage for the time being specified there, and

  (b) so as to specify different percentages in relation to licences to provide different services.'.

  Government amendment No. 27.
  No. 223, in page 119, line 13, at end insert—
  '3A. Provided that any proposal by a person who holds a licence to provide a service falling within any category specified in paragraph 1 (2)(a), (b), (c), (d) or (g) to acquire a further licence to provide one of the services so specified shall not take effect unless the Commission have examined the proposal and satisfied themselves that its terms are conducive to the public interest.'.
  Mr. Robert G. Hughes: I have been asked to table amendments Nos. 132 to 135 by Carlton Television. They are technical amendments that change the so-called audience attribution system introduced in Committee by the Government.
  The purpose of the Government's system is to take some account of holdings in television stations that are significant but fall short of overall control. If a company holds more than 20 per cent. of a television station but not enough to have control, it has to add one half of that
  818
  station's audience share to. its overall total. The amendments' purpose is to ensure that all such minority stakes in television stations are treated the same.
  Under the Bill as drafted, stakes over 20 per cent. in television stations trigger the audience attribution system, except in the case of channel 3, where the trigger is set at 15 per cent. I do not see a case for treating channel 3 stakes differently. It could lead to some serious anomalies.
  If, for example, the consortium running Channel 5 is made up of five companies holding 20 per cent. each, none of them would incur any extra audience share. Yet a 20 per cent. holding in a channel 3 licence, such as the one Carlton, Scottish and Granada hold in GMTV, would incur extra percentage points.
  The amendments make the system a little more balanced and give the Secretary of State the power to alter the trigger threshold should the need arise in future.
  Mr. Sproat: Amendments Nos. 220 to 223 and 249 seek to remove the scheme whereby holdings in television are regulated against a 15 per cent. audience share limit. We chose audience share as a way of regulating television ownership because it relates directly to plurality. Limits based on the number of licences are no longer appropriate because licences are not a balanced unit of measure and do not reflect the ability of a media owner to influence opinion.
  Amendment No. 237 is an alternative that would reduce the general limit on the holding of television licences from 15 per cent. of the total television audience to 10 per cent. But a 10 per cent. threshold would discourage companies from moving into digital broadcasting, particularly some of the larger players that would be well placed to make such investments. We therefore oppose those amendments.
  Government amendment No. 27 introduces an order-making power, subject to the affirmative resolution procedure, whereby sub-paragraphs (1), (3) and (6) of paragraph 2 of part HI of schedule 2 can be amended to reflect any significant change in audience measurement practices of the television industry.
  We have reflected further on the calculation of audience share and we are prepared to accept amendments Nos. 234, 235 and 236, and I hope that Opposition Front Benchers will enjoy my saying that. I am grateful to my hon. Friend the Member for Harrow, West (Mr. Hughes) for his cogent explanation.
  Mr. Maclennan: I rise briefly to thank the Minister for accepting amendments Nos. 234, 235 and 236: no doubt that will give satisfaction to the ITC, which submitted the amendments.
  Mr. Austin Mitchell: I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Amendment made: No. 234, in page 117, line 26, after `not', insert 'subject to sub-paragraph (3B)'.—[Dr. Moonie.]
  Amendment made: No. 131, in page 117, leave out lines 44 to 49.—[Mr. Robert G. Hughes.]
  Amendment made: No. 235, in page 117, line 50, after `(1)', insert 'and subject to sub-paragraph (3A)'.—[Mr. Maclennan.]
  Amendments made: No. 132, in page 118, leave out lines 1 to 4.
  No. 133, in page 118, line 7, leave out `1(2)(b)' and insert `1(2)(a), (b)'.
  No. 134, in page 118, line 9, leave out 'more than a 20 per cent.' and insert 'a qualifying'.
  No. 135, in page 118, leave out lines 11 and 12.—[Mr. Robert G. Hughes.]
  Amendment made: No. 236, in page 118, at end insert—
  `(3A) For the purposes of calculating a person's audience time in respect of any period in accordance with sub-paragraph (3):

  (a) there shall be included the audience time attributable in respect of that period to each service referred to in that sub-paragraph in respect of which, on the date upon which the calculation of his audience time for the purposes of sub-paragraph (1) is made, he holds the licence, is a participant in the body corporate which holds the licence, or which he provides (as the case may be), irrespective of whether he held the licence, or was a participant in the body corporate which holds the licence or provided the service at any time during the period; and

  (b) there shall (for the avoidance of doubt) be excluded the audience time attributable in respect of that period to each service referred to in sub-paragraph (3) in respect of which, prior to the date upon which the calculation of his audience time for the purposes of sub-paragraph (1) is made, he has ceased to hold the licence, or to be a participant in the holder of the licence, or to provide the service (as the case may be).

  (3B) Sub-paragraph (1) shall not prevent a person from continuing to hold any licence, or to be a participant in a body corporate which holds any licence, or from continuing to provide any service (as the case may be) if and to the extent that arrangements made by him after the end of period in respect of which his audience time exceeds 15 per cent of total audience time would cause his audience time calculated so as to take into account the effect of those arrangements, not to exceed 15 per cent of total audience time.'.—[Dr. Moonie.]
  Amendment made: No. 26, in page 118, line 27, at end insert—
  '() The Secretary of State may by order amend subparagraphs (1)(a), (3)(a) and (c) by adding a reference to relevant services falling within the category specified in paragraph 1(2)(aa).'—[Mr. Sproat.]
  Amendment made: No. 136, in page 118, line 27, at end insert—
  '(6) In this paragraph "qualifying interest" means an interest of more than 20 per cent.
  (7) The Secretary of State may by order amend sub-paragraph (6)—

  (a) by substituting a different percentage for any percentage for the time being specified there, and

  (b) so as to specify different percentages in relation to licences to provide different services.'.—[Mr. Robert G. Hughes.]

  Amendment made: No. 27, in page 119, line 13, at end insert—
  `(7) If it appears to the Secretary of State that there has been a significant change in the audience measurement practices prevailing in the television industry, the Secretary of State may, after consulting the Commission, make such amendments of sub-paragraphs (1), (3) and (6) as he considers appropriate for the purpose of taking account of that change.'.—[Mr. Knapman.]
  Mr. Sproat: I beg to move amendment No. 28, in page 119, line 41, leave out 'for any numerical limit' and insert
  820
  `or percentage for any numerical limit or percentage'.
  Amendment No. 28 enables the Secretary of State to vary the percentage interest short of control that a person may have in licences to provide television multiplex services.
  Amendment agreed to.
  Mr. Sproat: I beg to move amendment No. 29, in page 120, line 24, leave out from first 'services' to second `services' and insert
  `by means of two or more television multiplex services if the number of points attributable to those digital programme'.
  Mr. Deputy Speaker: With this, it will be convenient to discuss Government amendments Nos. 30, 31, 147 and 32.
  Mr. Sproat: In the start-up phase of digital terrestrial television, a broadcaster may wish to provide several services on one multiplex. We do not want to prevent that, but the ownership points system would have done so. The amendment would allow the points system to operate only where a broadcaster is providing services on more than one multiplex. Amendment No. 29 gives digital terrestrial television a better chance of a successful launch and ensures that we can safeguard plurality of voice in its initial stages, before the overall 15 per cent. audience limit can bite.
  Amendment No. 32 allows the Secretary of State to vary elements in the digital points system set out in paragraph 7 of schedule 2.
  We do not yet know precisely how digital television will develop. Therefore, the ownership regime must be able to cope with unforeseen developments.
  The radio points system, which is set out in paragraphs 8 to 10 of schedule 2, already provides for the variation of elements within that system. Amendment No. 32 extends a similar flexibility to the digital points system.
  Amendment No. 147 is a minor technical amendment that clarifies the drafting of paragraph 7(8).
  Amendment agreed to.
  Amendments made: No. 30, in page 120, line 32, leave out 'broadcast' and insert 'provided'.
  No. 31, in page 120, line 33, leave out 'broadcast' and insert 'provided'.
  No. 147, in page 121, line 26, leave out from 'licence' to 'to' in line 29 and insert
  `but who does not control that body, shall be taken'.
  No. 32, in page 121, leave out lines 30 to 32 and insert—
  `(9) The Secretary of State may by order amend this paragraph—

  (a) by altering the number of points for the time being attributable to digital programme services falling within sub-paragraph (2), (3) or (4),

  (b) by substituting a different number of hours for the number for the time being specified in sub-paragraph (3), (4) or (5),

  (c) by substituting different numbers for any numbers for the time being specified in sub-paragraph (7), and

  821

  (d) by substituting a different percentage for the percentage for the time being specified in subparagraph (8).'—[Mr. Knapman.]

  Mr. Sproat: I beg to move amendment No. 148, in page 121, line 43, at end insert 'or have been awarded'.
  Mr. Deputy Speaker: With this, it will be convenient to discuss Government amendment No. 149.
  Mr. Sproat: Amendments Nos. 148 and 149 make it clear that, for the purposes of the 15 per cent. total radio ownership points limit, points will be allocated to the company concerned when a licence is awarded. In other words, the Radio Authority will not wait until the company is broadcasting.
  Amendment agreed to.
  Amendments made: No. 149, in page 121, line 51, after `force' insert 'or have been awarded'.
  No. 150, in page 124, line 45, at end insert—
  `(5A) This paragraph has effect subject to paragraph 12A.'
  No. 151, in page 125, line 3, at end insert—

  'Power by order to impose different restrictions in place of paragraph 12
  12A. The Secretary of State may by order provide that, where a digital sound programme service is provided in any area, the holding by any one person of two or more licences to provide in that area local radio services which for the purposes of paragraph 12 share a potential audience with each other or with each of the others shall, instead of being subject to the restrictions specified in paragraph 12, be subject to other restrictions specified in the order.'.—[Mr. Knapman.]
  Mr. Sproat: I beg to move amendment No. 33, in page 125, line 7, leave out 'such' and insert 'non-simulcast'.
  Mr. Deputy Speaker: With this, it will be convenient to discuss Government amendment No. 34.
  Mr. Sproat: The amendments take account of the fact that local radio broadcasters are likely to want to simulcast their existing AM or FM services on local radio multiplexes and may also wish, and will be well placed to do so, to provide new services. Therefore, we have changed the restrictions on the provision of services on local radio multiplexes so that a broadcaster can provide any number of simulcast channels and one non-simulcast service on a local multiplex. It does not guarantee local broadcasters capacity on the local multiplex, but it recognises their distinctive position and the fact that digital local multiplexes are likely to cover wider areas than analogue licences.
  Amendment agreed to.
  Amendments made: No. 34, in page 125 leave out lines 8 to 28 and insert—

  '(2) Where—

  (a) the coverage area of the local radio multiplex service is to a significant extent the same as that of another local radio multiplex service, and

  (b) the person concerned is not providing any non-simulcast service by means of that other local radio multiplex service,
  822
  sub-paragraph (1) shall have effect as if the reference to one non-simulcast service were a reference to two such services.

  (3) In this paragraph "non-simulcast service" means any local digital sound programme service other than one which—

  (a) is provided by a person who holds a licence to provide a local radio service, and

  (b) corresponds to that local radio service.

  (4) For the purposes of sub-paragraph (3)(b) a local digital sound programme service corresponds to a local radio service if, and only if, in every calendar month—

  (a) at least 80 per cent. of so much of the local radio service as consists of programmes. consists of programmes which are also included in the local digital sound programme service in that month, and

  (b) at least 50 per cent. of so much of the local radio service as consists of such programmes is broadcast at the same time on both services.

  (5) The Secretary of State may by order—

  (a) amend sub-paragraphs (1) and (2) by substituting a different numerical limit for any numerical limit for the time being specified there, and

  (b) amend sub-paragraph (4)(a) or (b) by substituting a different percentage for any percentage for the time being specified there.

  (6) In subsection (4) "programme" does not include an advertisement.'

  No. 35, in page 125, line 28, at end insert—

  'Further restrictions on holding of licences of different descriptions
  13A.—(1) No one person may at any time hold—

  (a) a licence to provide a national Channel 3 service or Channel 5, and

  (b) a licence to provide a national radio service.

  (2) No one person may at any time hold—

  (a) a licence to provide a local radio service or local digital sound programme services, and

  (b) a licence to provide a regional Channel 3 service whose coverage area is to a significant extent the same as that of the local radio service or of any local digital sound programme service provided by him.'

  No. 36, in page 125, line 32, leave out `1(2)(b)' and insert '1(2)(aa), (b)'.
  No. 37, in page 125, line 40, after '1(2)(a)' insert 'or (aa)'.
  No. 38, in page 125, line 43, leave out '13' and insert '13A'.—[Mr. Knapman.]
  Mr. Sproat: I beg to move amendment No. 39, in page 126, leave out lines 8 to 12.
  Mr. Deputy Speaker: With this, it will be convenient to discuss Government amendment No. 40.
  Mr. Sproat: Amendments Nos. 39 and 40 are minor drafting amendments that are consequential on the removal of local radio services from the scope of the order-making power in paragraph 14(1) of schedule 2. As local radio is no longer subject to an order made under paragraph 14(1), paragraph 14(4) is redundant.
  Amendment agreed to.
  Amendments made: No. 40, in page 126, line 23, leave out 'sub-paragraphs (4) and (5)' and insert 'subparagraph (5)'.
  No. 152, in page 126, line 37, at beginning insert 'Subject to sub-paragraph (1A)'.
  No. 41, in page 126, line 38, leave out '13' and insert '13A'.
  No. 153, in page 126, line 39, after 'paragraph' insert '12A or'.
  No. 154, in page 126, line 42, at end insert—
  `(1A) For the purposes of paragraph 12 and any order under paragraph 12A, a person shall not be treated as holding a licence to provide a local radio service merely because he is a director of a body corporate which holds the licence.'
  No. 42, in page 126, line 46, leave out from beginning to end of line 19 on page 128.—[Mr. Knapman.]
  Dr. John Cunningham: I beg to move amendment No. 102, in page 129, leave out lines 32 to 37.
  Mr. Deputy Speaker: With this, it will be convenient to discuss the following amendments: No. 260, in page 129, line 32, leave out from 'newspaper' to 'may' in line 34.
  No. 261, in page 129, line 34, leave out '20' and insert '10'.
  Government amendments Nos. 43 and 44.
  No. 262, in page 129, line 37, at end insertp—
  '(d) a domestic or a non-domestic satellite service.'.
  No. 162, in page 129, line 41, at end insert—
  '(2A) If as a result of a takeover a person who owns or controls newspapers with a circulation market share above the percentage specified in paragraphs 4(1) and (2) becomes the holder of a licence to provide a Channel 3 service, the Independent Television Commission shall not for that reason alone revoke that licence unless a period of 12 months from the takeover has elapsed and the newspaper proprietor has failed to reduce the market share of those newspapers he controls to below the specified percentage.'.
  No. 263, in page 130, line 7, at end insert—
  '(6A) Any person who immediately prior to the date of coming into force of Schedule 2 to the Broadcasting Act 1996 was both the proprietor of a national newspaper and the holder of a licence to provide any of the services mentioned in sub-paragraphs 1(a) to (d) of paragraph 4 above shall, within three months of that date, take such steps as are necessary to comply with the provisions of that paragraph.'.
  Government amendments Nos. 45 and 46.
  Dr. Cunningham: Amendment No. 102 addresses one— of the most controversial aspects of the legislation—the regulations on cross-media ownership. The amendment seeks to delete that part of the Bill which contains the limit on cross-media ownership by national newspapers.
  At present, any newspaper group with more than 20 per cent. of the national market share is not allowed under the Bill to hold a licence to provide a regional national channel 3 service. In practice, that provision affects only two companies—Mirror Group Newspapers and News International.
  In seeking to abolish the limit, Labour has been portrayed as advocating no controls on media ownership. That is certainly not the case. The Bill contains two other important provisions that we fully support: first, the rule whereby no single television supplier may accumulate more than 15 per cent. of the total television audience and, secondly, the important public interest tests that may
  824
  be applied by the Independent Television Commission and which are contained in paragraphs 7 to 12 of schedule 2.
  In advocating lifting one restriction on cross-media ownership, it is important to spell out why we believe that this is such an important issue. In Britain, we have a large number of newspaper groups which, whether we like them or not, have managed to flourish over a period of years. More recently, there has been major growth in the television market as well as concentration of ownership. The future of the media, which is important to us all, is likely to continue broadly in the same way. Some people believe that newspapers are in long-term decline and that the future lies much more in broadcasting and the development of multimedia companies.
  I do not believe that we should commit ourselves to opposing the development of cross-media ownership or the growth and success of large companies. The idea of a Britain where large numbers of small companies make high-quality television programmes for the local area in which they broadcast while the Berlusconis and Bertelsmanns compete across Europe and the world is not a realistic proposition. One of the implications of the Bill as it stands is that Mirror Group Newspapers is denied ownership of a channel 3 licence, while the Berlusconi and Bertelsmann empires are not. Other European multi-media groups could purchase such licences, but Mirror Group Newspapers and News International could not.
  The Government have got themselves into a terrible mess. There are seven major newspaper groups, five of which are to be allowed to enter the television market. Another, News Corp, is already a major player in television. BSkyB is currently about third in the viewing figures when the public service broadcasters are discounted, and all credit should be given to it for the initiative, investment and innovation that it has brought to television broadcasting in this country. It is obvious that satellite broadcasting will be increasingly important and influential as the technology develops.
  8 pm
  The practical implication of the proposals is that a single newspaper group—a successful British newspaper group that wants to expand into broadcasting—is being prevented from doing so. It is a coincidence that it happens to own a newspaper that supports the Labour party; the arguments would be the same regardless. We have been accused of being politically partial in this matter, but, if there is any real argument for political partiality, it is exactly the other way round: the Government's friends are being looked after in the legislation, and the single newspaper that supports Labour is being excluded.
  The Government's explanation has been, first, that the 20 per cent. limit was arrived at intuitively: it seemed about right to everyone. Some would say that it is completely arbitrary, while others would argue that it is not arbitrary at all—that it was set deliberately to have the effect that I have described—but there is no rational argument for it. Some will argue that the 15 per cent. rule in television is equally arbitrary, but I do not agree with that. At present, apart from the public service broadcasters—the BBC, Channel 4 and S4C—no broadcaster has more than 6 per cent. of the market. The

  825
  15 per cent. rule is there to prevent further market concentration by a single company. The 20 per cent. rule, however, cuts a swathe through an existing newspaper market, placing newspapers on opposite sides of an artificially erected barrier. That is why we have suggested that the limit on cross-media holdings should be lifted, and that other regulatory mechanisms should be used to protect the public interest. That is what the ITC was constructed to do, and that is what the powers in the Bill allow it to do.
  If the amendment is not accepted, we shall support the amendment tabled by the hon. Member for North Thanet (Mr. Gale). As is well known, he and I do not always agree on these matters in the context of the Bill, but we both see a considerable case for amendment No. 162, which is intended to allow a newspaper with more than 20 per cent. of the national market to become a television licence holder, and then to be allowed up to 12 months' grace in which to divest itself of some of its newspaper holdings.
  On 21 May, in Committee, the Minister said:
  "the hon. Gentleman will none the less see in paragraph 10 of part IV of schedule 2 on page 108 of the Bill that if the Daily Mirror wanted to acquire a channel 3 interest, it could have 12 months in which to divest itself of, for example,The People, or of whatever title it decided upon, in order to bring itself under the 20 per cent. ceiling. It could therefore make the takeover and then divest itself '.—[Official Report, Standing Committee D, 21 May 1996; c. 423–24.]
  There is indeed a measure of dispute about whether the Bill actually provides for such circumstances, but, in subsequent correspondence with members of the Committee, the Minister wrote that
  "while the Mirror Group, or any other group holding over 20 per cent., could make a bid for a Channel 3 licence and indeed have the bid accepted, before they had made the necessary divestment, that Group could not take over and own the Channel 3 station until after the divestment."
  That statement directly contradicts what the Minister said in Committee. The Government have apparently gone back on the commitment that everyone—including people outside the House—thought that the Minister had given, and I expect an explanation from him. Amendment No. 162 puts that commitment firmly in the Bill, and, given what the Minister said in Committee, the Government should be duty bound to accept it.
  My hon. Friend the Member for Sunderland, South (Mr. Mullin), who has taken an interest in these matters, has tabled amendments which—although I cannot encourage the House to support them—would at least be fairer than the current position. They would exclude all the major newspaper groups from owning channel 3 licences. That might not be sensible in other respects, in that it could block the development of multimedia ownership, but at least it could be seen as fair among large newspaper groups. Because we support the development of multimedia ownership, however, we shall not support those amendments.
  Unless this change is made, one newspaper group, Mirror Group Newspapers, will be denied the opportunity given to all other media companies in the group's area of operation—in its sector—and its development will be severely curtailed. There will also be a further imbalance in the power, influence and profitability of the British press. That is the long-term implication of the Bill's proposals.
  826
  It is argued that the amendments would benefit the Murdoch empire as well, but I do not consider that the circumstances are the same. First, if News Corp wanted a channel 3 licence, it would have to divest itself of not 3 per cent. but a massive 18 per cent. of its newspaper holdings to bring itself within the 20 per cent. threshold. Most people know that that is highly unlikely. Secondly, why should a company with a major interest in BSkyB bother to acquire a channel 3 licence when it is already making significant strides in the market, and has already publicly announced massive investment in digital satellite broadcasting?
  It appears—I shall say this as gently as I can—not only that the Minister has gone back on the commitment that he gave in Committee, but that behind the scenes, in discussions that we all know to have taken place between officials of the Department of National Heritage and Mirror Group Newspapers and its representatives, commitments have been made and broken, and proposals that have apparently been accepted have subsequently been rejected. The Government have handled the whole issue very badly, but it is not too late for them to correct the position, and I urge them to do so.
  Mr. Gale: I wish to speak to amendment No. 162, tabled in my name and that of the Leader of the Opposition. Let me make it abundantly clear that I do not support amendment No. 260. I am astonished that the Opposition should table any amendment that is remotely likely to allow News International a further stranglehold on the British media, and I expect not only my hon. Friends but Opposition Members to oppose it.
  Amendment No. 162 simply seeks to place in the Bill the undertaking that the Minister gave to me in Committee. As the right hon. Member for Copeland (Dr. Cunningham) mentioned, in Committee the Minister said:
  "if the Daily Mirror wanted to acquire a channel 3 interest, it could have 12 months in which to divest itself of, for example,The People, or of whatever title it decided upon, in order to bring itself under the 20 per cent. ceiling. It could therefore make the takeover and then divest itself, rather than the other way round,".—[Official Report, Standing Committee D, 21 May 1996; c. 423–24.]
  In a letter to my hon. Friend the Member for Macclesfield (Mr. Winterton), who was the Chairman of the Committee, the Minister said:
  "I would like to make clear that while the Mirror Group, or any group holding over 20 per cent., could make a bid for a Channel 3 licence and indeed have the bid accepted, before they had made the necessary divestment, that Group could not take over and own the Channel 3 station until after the divestment."
  I have discussed this matter privately with the Minister and I am sure that he will not quarrel with what he said to me at the weekend, that it was his understanding that Mirror Group Newspapers—or, indeed, any other newspaper group, but we are talking about the Mirror group—could acquire a channel 3 company. That is the important part on which we seek clarification. If the Minister can give me the answer that I want, I shall not pursue the matter further.
  I appreciate that the Mirror group would like more freedom, but I would settle for clarification as, I believe, would the Mirror group. I am told that it can acquire a channel 3 licence, but that it cannot control it until it has divested itself of The People or another newspaper. The confusion between us appears to be precisely what is

  827
  meant by "acquire" and "control". My understanding from our conversation was that the Mirror group could acquire a channel 3 licence, could buy all the shares, and leave the existing management in place while it divested itself within 12 months of newspaper holdings to bring itself within the 20 per cent. If it did that, there would be no problem and when it had divested itself of the requisite amount the ITC would approve the licence and the group would take over control as well as ownership.
  It now seems that the group can acquire in the sense that it can sign on the dotted line and agree the price but that it cannot transfer the shares. That might seem merely semantic, but for the fact that David Montgomery, the chief executive of Mirror Group Newspapers, has told me that the City would not wear that; that it would not be possible to finance that kind of deal.
  My interest in this matter is not to support the Mirror group: it does not support my party, it has certainly done me no favours, nor do I expect it to. As the Minister knows, my interest in the matter is purely one of equity. I do not care what political party the group supports and I am satisfied with the 20 per cent. figure, as was the Labour party in another place. It is only since the Bill came here that there has been confusion and concern among Opposition Members about the 20 per cent. As I say, I am happy with the 20 per cent. and I think that the Daily Mirror management has accepted it—provided that it is free to acquire the shares and then to divest, which is what the Minister said in Committee and what we all understood would be the case.
  I do not suggest, and I slightly resent the fact that the right hon. Member for Copeland seemed to suggest—unless I misunderstood him, which I often do—that the Minister had in some way deliberately misled the Committee or the House.
  Dr. John Cunningham indicated dissent.
  Mr. Gale: I am grateful to the right hon. Gentleman. I withdraw my suggestion and thank him for his clarification. I certainly do not suggest that the Minister has in any way deliberately misled the House. However, it is important for all concerned to clarify this matter now at the 11 th hour and to make abundantly clear precisely what the Minister seeks to allow anybody with a holding over 20 per cent. to do. If, as he has said, one can acquire the shares but not control, everybody would be reasonably satisfied. However, if all that one can make is some sort of half a deal and then divest, it is unlikely to be workable. I hope that the Minister will be able to give me the assurances that I seek in the name of fair dealing. It is as simple as that.
  8.15 pm
  Mr. Gerald Kaufman: I have a rather peculiar declaration of interest. For nine years I was a member of the staff of the Daily Mirror when it was one of this country's great newspapers and was directed by Hugh Cudlipp. I do not write frequently for newspapers in the Mirror group, although I write for a number of other newspapers. I therefore have a peculiar disinterest in the interests of the Daily Mirror and in the amendment that my right hon. Friend the Member for Copeland (Dr. Cunningham) has moved.
  I hold no particular brief for Mirror Group Newspapers, and if the amendment sought only to favour that group I would not have risen to speak. Although my right hon.
  828
  Friend the Member for Copeland, from his position on the Front Bench, has some sort of party political interest to pursue, from the Back Benches I rise loftily above such considerations. I am trying to deal with extremely important issues relating to communications policy which are involved in the amendment, in the schedule and in the part of the Bill with which we are dealing.
  Much of the Bill is extraordinarily old-fashioned and backward looking. If I am called to speak on Third Reading I shall say more about that. It is an extraordinary Bill from a Conservative Government who claim to believe in the free market. The restrictions that it imposes on cross-media ownership are extraordinary not only because they come from a Conservative Government, but because they appear at a time when the whole nature of communications is changing.
  Day after day, one reads in the specialist press about a coming together of newspapers, television, radio, computers and telephones. That development cannot be stopped and I strongly welcome it. The Bill, and particularly the part that we are debating, stands futilely in the way of that. Those developments will take place but the Bill will interfere with them in a partial and illogical way. This is not the moment to go into the utter idiocy of the calculation of rules about audiences and the nonsense of believing that one can estimate the proportion of 15-year-olds who watch or listen to television or radio programmes. Among adults that is absurd, but as the idea comes from the Department of National Heritage, it is neither silly nor absurd but absolutely characteristic.
  While we debate this dull, drab Bill—little in its scope, if large in its number of pages and clauses—in other countries massive changes are under way. Microsoft and the National Broadcasting Corporation have got together to provide a 168-hour-a-week news service, which moves between the television screen and the computer, so that a viewer can amplify the news coverage as she or he wishes. All sorts of other developments are taking place. Later this year, it will be possible to have a device by which one can receive the Internet on the television set rather than on computer. Interactive computer games will be available on cable television. The whole communications landscape has changed while the Bill has been going through the House of Commons and since I spoke on Second Reading—even then, in a critical manner.
  Because there is no logical consistency in the Government's policies on these matters, ITV companies are able to gobble each other up almost at will—one hardly knows any more which owns which—but unless the Bill is changed as a result of the amendment, it will mean not an organic and sensible growth of media ownership in this country, but a Procrustean interference in media growth, which will do no one any good and will do the country less good than anyone else.
  As has been pointed out, in general, to abide by the restrictions in the Bill, newspapers could be faced with the absurdity of having to cut their circulation to meet the market share provisions. No newspaper can easily do that. What a newspaper group can do—and we are dealing with newspaper groups—is precisely what is being talked about and has been written about in the press in the past few days. For example,The Times reported that, in order not to be restricted by the provision—which my right hon. Friend the Member for Copeland is trying to relax—Mirror Group Newspapers is thinking of selling The

  829
  People. What good would it do to take a newspaper from the ownership of a group that is able to cross-subsidise it, if it needs to, if the newspaper is in trouble? Mirror Group Newspapers can do that and allow such a newspaper to float freely.
  Right hon. and hon. Members may not have much of an opinion of The People, but that is not the point. The whole point about a democracy is that, in a democracy, newspapers of which one does not have a high opinion must have as much right to publish and as much chance of survival as newspapers of which one does, subjectively, have a high opinion.
  Mr. David Winnick: I understand the sentiments of my right hon. Friend the Member for Copeland (Dr. Cunningham) in moving the amendment and I have listened carefully to my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman), but is he saying—perhaps if this is not the position, he will soon put me right—that he does not want any restriction on ownership, and that in a democracy all such restriction is an impediment to technological development in the media, because I do not go along with him on that?
  Mr. Kaufman: My hon. Friend has a right not to go along with me. Restrictions of this rigidity, stringency and artificiality can only damage this country's communications.
  Mr. Winnick: So no restrictions?
  Mr. Kaufman: I am not saying that we should get rid of all restrictions—although there is an argument for saying that in a world in which this country's communications groups, with the exception of some of the largest groups, are tiny compared with those outside—so I do not give my hon. Friend quite the answer that he would like to have.
  Let us forget about The People, although in a democracy it has as much right to publish and to seek an audience as anyone else, and consider the two other newspapers that are under the aegis of Mirror Group Newspapers:The Independent and The Independent on Sunday. Under its new editor, The Independent is becoming a remarkably interesting and vibrant newspaper which deserves much support. I say that again with a declaration of non-interest in that I rarely write for it and it is in competition with newspapers for which I do write.
  Mr. Winnick: It must be one of the few.
  Mr. Kaufman: I am open to offers. Could anyone say that it would be a good idea for these rules, restrictive as they are on Mirror Group Newspapers, to compel Mirror Group Newspapers to consider divesting itself of The Independent, which it rescued and which is becoming a remarkably interesting and individual newspaper? That will do no good. It will not even benefit newspapers with which The Independent competes, because a newspaper such as The Guardian must improve—and, by God, it has scope to improve—to compete with a lively newspaper such as The Independent.
  Newspapers are not only publications that one purchases over the counter. It is not simply in the United States that Bill Gates is financing an Internet newspaper
  830
  edited by the former editor of the New Republic. On the front page of The Daily Telegraph, in the bottom left-hand corner, one will find that we can get The Daily Telegraph on the Internet—an excellent idea. I hope that more and more newspapers will do that.
  Other newspapers are expanding in different ways. Associated Newspapers owns Teletext, about which the Government have performed gyrations and acrobatics during the passage of the Bill. It also owns a cable channel. Mirror Group Newspapers owns a cable channel. I am all in favour of such diversification and diversity. I favour much more cross-media ownership, because that is good for the media and for creating more newspapers and publications, both in print and on the Internet.
  If the Government persist in such a restrictive attitude, even for the short period of office remaining to them, they will be helping Britain to remain a tiddler in the international communications pool. That is not good for Britain. In relation to this part of the Bill, it happens not to be good for Mirror Group Newspapers, but the interests that I am talking about go far wider than that. I hope that the Government will listen seriously to the arguments of my right hon. Friend the Member for Copeland and accept his amendment because, apart from anything else, it will spare him from having to introduce a new Bill in the middle of next year.
  Mr. Maclennan: It is odd that, in this debate about competition policy, the Opposition have at no time mentioned the interests of the consumer, whose concerns should be at the heart of the matter. We have heard from the right hon. Member for Manchester, Gorton (Mr. Kaufman) about the desirability of commercial expansion—empire building is what it might have been called in the days of old Labour—and the right hon. Member for Copeland (Dr. Cunningham) asked whether Mirror Group Newspapers was being unfairly treated. What we have not heard from the Labour party's spokesman in this debate is any indication of Labour's understanding of the purpose of competition policy, to protect the diversity and plurality of the channels of communication to the public.
  The futuristic picture of the right hon. Member for Gorton is one that we can all enjoy speculating about, but it is the future. [HON. MEMBERS: "It is happening."' It may be happening, but the effects will take some time. No doubt other regulatory measures will be taken to ensure that the changes are properly reflected when they constitute a significant threat to plurality and diversity. At present, they do not. The right hon. Gentleman might take a very different view if, after the next election,The Sun was able to say once again, "It was The Sun wot won it", not only in the newspaper but in news broadcasts on terrestrial channels.
  8.30 pm
  The risk of over-concentration is not fanciful. I do not consider that News Corp, for other reasons of regulatory policy, including the nationality exclusions, is likely to be in a position to dominate in that way. However, the static view, that the relationship between companies will remain roughly the same as now, is an improbable picture of what is likely to happen over the next decade. That is what we are talking about. We are talking about legislating not for all time, but for the short term. That is not irresponsible, but is entirely necessary.

  831
  I do not think that anyone has argued that the 20 per cent. threshold can be justified in terms of any particular principle. That is a point I argued in Committee. The percentage threshold approach was argued by the Labour party when the Bill was introduced in the other place. Lord Donoughue argued that 25 per cent. would be an acceptable percentage because it would deal with the Mirror group problem.
  Dr. John Cunningham: Will the hon. Gentleman give way?
  Mr. Maclennan: In a moment.
  The notion of a percentage threshold was accepted by the Labour party in another place, and 25 per cent. was held to be the appropriate figure because it would bring the Mirror group under the net.
  I have no doubt that the Government were aware when they proposed 20 per cent. that the Mirror group was being caught on the wrong side. For that reason, I too would have accepted a movement to 25 per cent. When the Bill was in Committee, the Labour party's spokesmen argued that 25 per cent. would have been appropriate. The only reason they did not push that was the order in which the amendments arose. They said that they could not vote on that, and that therefore they would vote on the other approach—the one that they are pushing tonight—in amendment No. 102. That is a risky route, and we should not take it.
  I am not alone in arguing that point. Many media interests, not only newspaper groups, are in favour of retaining what the Government have proposed. Granada and LWT have pointed out the risks of following the advice of the right hon. Member for Gorton. The House is wise to take some heed of those warnings.
  If the Bill has to be changed in seven years, I do not think that that will mean that it has not served a purpose. There is nothing wrong with dealing with things as they are. That is better than having one's head in the clouds, which I suggest has been the case with the right hon. Member for Gorton during a number of debates on broadcasting.
  Mr. Kaufman: I am not sure what the hon. Gentleman means about my head being in the clouds. For some time now, everything that I have talked about in all the debates on broadcasting—whether on the BBC charter, this Bill or at other opportunities—has been happening at the time or has come to pass. If the hon. Gentleman thinks that a description of developments in communications which are changing the nature of our world and our society means that my head is in the clouds, I fear that it is his head that is in the clouds.
  Mr. Maclennan: The right hon. Gentleman knows, because I have made it clear, that I am not denying that those developments are taking place. What I am asserting, and what I assert again, is that they do not constitute a threat to diversity and plurality. Indeed, they may assist that process. As things stand, the narrow concentration of press ownership in the hands of a relatively small number of groups in this country could constitute a significant threat to diversity in the short term. That is what we have to deal with in the Bill.
  832
  I do not think that the Mirror group has been well served by its political friends, given the way they have twisted and turned around the question of the 25 per cent. market share. The amendment tabled by the hon. Member for North Thanet (Mr. Gale) goes some way towards helping to deal with the injustices, and I have no hesitation in subscribing to it.
  It is reasonable that the Mirror group should be in a position to acquire a channel 3 television station and, within 12 months—the grace period allowed by that amendment—divest itself. That position, as it was understood by Committee members, appeared to be supported by the Minister in Committee. There have been the most extraordinary tergiversations in the Department of National Heritage since that time. Candidly, I cannot understand how the Minister has got himself into this position. He is an extremely straightforward Minister, and I can assume only that the affair has been taken out of his hands.
  It was clear from what the Minister said in Committee—the hon. Member for North Thanet quoted his words—that he intended that the matter should be dealt with in the way proposed by the amendment. His letter of 28 June to the hon. Member for Macclesfield (Mr. Winterton) and other members of the Committee is incomprehensible in terms of the sequence of historical events—it does not lie squarely with what he said before—and makes no sense in English. I cannot imagine how it could be interpreted by a court of law.
  I hope that the hon. Member for North Thanet has been drumming up some support for his amendment among his hon. Friends, and I hope that the Minister has had time to take into account the evident injustices to the Mirror group, which the amendment would go some way to addressing.
  Another matter has been raised, probably with many members of the Committee, by the GWR Group. It concerns amendments Nos. 44 and 46. I feel that I should raise this matter, although I recognise that it is not as exciting as some of those we have been discussing so far. It concerns the Government's withdrawal of market share threshold on newspaper ownership of digital audio broadcasting, which GWR points out offers the newspapers the opportunity to enter DAB through the back door.
  GWR says that, if DAB is to be the medium of the future, the amendments allow newspapers to move straight into that broadcast medium. The concerns expressed by the GWR Group include the lack of sufficient DAB spectrum for local multiplexes, and the fear that it will be further exacerbated by the added competition of free access by dominant newspaper groups.
  ILR has already been put into an invidious position regarding access to local DAB multiplexes. The BBC local radio services and independent national radio have guaranteed access to their appropriate multiplexes. However, independent local radio has no such guarantee, and the lack of clarity will be compounded by the relaxation of newspaper ownership laws.
  This group of amendments is probably among the more important matters that we have had to consider in the debate on this Bill. I must confess to having found the Labour party's position very disturbing if it is a reflection of how it may behave if it was ever to form a Government.

  833
  We must take its position seriously. I can assume only that the freedom of opposition allows it to canter down this rather circuitous route. I sincerely hope that it does not put itself in hock to substantial newspaper interests if it is entrusted with government.
  Mr. Chris Mullin: I shall be brief, particularly as the Labour Chief Whip is in the Chamber. I shall speak to the amendments in my name and the name of my hon. Friend the Member for Great Grimsby (Mr. Mitchell)—amendments Nos. 260 and 261—and to those that are only in my name, amendments Nos. 262 and 263.
  I listened with great care to the speech of my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman), whose views I always take very seriously. I think that he is wrong on this occasion, but I acknowledge that his position is well thought out, and one which he has held for a long time and argued consistently. I think that he has allowed himself to become dazzled by technology. I am much more interested in the quality of what appears on television, and the implications that that has for the future of our democracy.
  Regulation in the British television industry has worked, and the only reason we have something worth defending is that it has worked. If regulation had not worked, or if we had not regulated in the 1950s, 1960s and 1970s, we would have nothing worth defending now. But we have something that is worth defending, which is why we must reflect carefully on where the future lies.
  I should also like to comment on amendment No. 102, which was tabled in the name of my hon. Friends. I listened carefully to what my right hon. Friend the Member for Copeland (Dr. Cunningham) said, and I accept that there is a certain logic in the Opposition amendment. Whatever percentage one selects—whether it is 20 per cent. or 10 per cent.—by definition it will be arbitrary. Everyone understands that. But to accept his argument, one must have a touching faith in regulators' abilities.
  As I understand it, the Opposition's position is to take off all artificial limits on the size of a newspaper company's market share before it moves into television, and to substitute a public interest test. To enforce that public interest test, one obviously must rely on the Monopolies and Mergers Commission, which has let us down very badly in the past, or on the Independent Television Commission, which has done better than the MMC. But I do not think that either of those institutions—even if they were beefed up—is necessarily capable of facing up to the mighty and enormous vested interests we face.
  I should be much happier with amendment No. 102 if someone could convince me that those institutions were up to the task, that there would be a totally revamped MMC, and that behind it would lie the political will to stand up to those corporations. I believe that it is a responsibility of politicians to intervene in the broadcasting marketplace.
  When my right hon. Friend the Member for Livingston (Mr. Cook) was the shadow Secretary of State for Trade and Industry, he wrote to the Director General of Fair Trading—who was then Sir Bryan Carsberg—to ask what
  834
  he thought the limit should be on media ownership. Sir Bryan wrote back to him—I gave a little cheer when I read the letter—saying, in effect, that it was not a responsibility that could be shuffled off on to the Monopolies and Mergers Commission; it was a matter for politicians. It was for politicians to decide. He was absolutely right.
  It is a matter for politicians to decide, and that is why I tentatively offer alternatives to the Opposition's position. My amendment Nos. 260 and 261 offer two alternatives. They are, as my right hon. Friend the Member for Copeland conceded, more logical than the Government's position, even if they are not his first preference.
  8.45 pm
  My first amendment is that no national newspaper should be allowed to buy into television. As I said, that is my first preference, everything else being equal. I want diverse media, and I think that that is an essential precondition of a democracy.
  My second amendment, amendment No. 261, which is also in the name of my hon. Friend the Member for Great Grimsby, provides that only newspapers with less than 10 per cent. of the market may buy into television. That would have the effect—which I commend to the House—of excluding all our tabloid newspapers. It would not discriminate only against the Daily Mirror; it would discriminate against them all.
  The argument for such discrimination is quite simple. Those who brought us junk journalism will bring us junk television if we let them, and we should not. There is nothing about those corporations' stewardship of our popular newspapers that suggests any reason why we should be nice to them. We had yet another disgraceful display with the recent European football championship of why we do not want the people who control those newspapers also to get their hands on television.
  Amendment No. 262, which is in my name only, adds non-domestic satellite television to the categories listed in schedule 2. That would have the advantage of inviting Mr. Murdoch to choose between his television assets and his newspaper assets. I am neutral as to which he should choose, but, should he choose to stick with his newspapers, owning four national newspapers is too many in a fragile democracy such as ours. In my broadcasting Bill, newspaper corporations would be allowed to own one daily and one Sunday newspaper, and all the others would have to be put on the market. However, we are not discussing my Bill.
  My amendment No. 263 would give any corporation that owns more than the limits allowed in the other amendments three months to divest.
  As I said, I believe that the free flow of information is a precondition of democracy. I believe that diversity of ownership—the more the better—is the best guarantee of that. I do not believe that big is beautiful or necessary. We talk about the need to compete with mighty American corporations and with one or two of the big European ones. I do not think that we will ever be able to compete on that scale.
  Ultimately, a handful of American corporations—probably American, but there may be one or two European corporations, and perhaps one Japanese among them—will eventually dominate most of the earth. I do not want to see us included as an offshore part of a great empire.

  835
  We have already reached a situation in this country in which Mr. Murdoch is so big that even the Conservative party—which helped to create this monster—is afraid of him. As politicians, we recognise that it is not possible to win an election with The Sun against our party. I do not think that Labour has won an election since Mr. Murdoch took control of The Sun. The best that we can hope for—and, by God, we are doing our best—is a surly neutrality at the next election, and we can expect that only once. I do not want somebody who has mishandled the newspapers he owns being given greater access to television.
  Mr. Kaufman: My hon. Friend over-estimates the influence of the press. In 1970, the Labour party lost the general election even though it was supported by both The Sun and the News of the World.
  Mr. Mullin: As my right hon. Friend knows,The Sun was a quite different animal in 1970. He and I both worked for the Daily Mirror in the days when it was a good newspaper—which it is not now.
  Some 18 months ago, I introduced the Media (Diversity) Bill, which would have implemented one or two of the proposals in these amendments, as well as one or two other things. When I presented the Bill, I referred to those who are currently running our media as unscrupulous megalomaniacs. That resulted in my being invited to lunch, one by one, with all of them. They were charming and eloquent—not in any way the stereotype of a media baron. One by one, they sought to persuade me that big was beautiful, that they would be extremely responsible were the market to be allowed to let rip, and that we should regulate in general terms but not impose any limits on size. I am afraid that I was not persuaded.
  Some of the arguments about the advantages of new technology were advanced at the time that Mr. Murdoch broke the unions at Wapping. I must say that, in some respects, he had a good case for doing so, bearing in mind some of the abuses in the newspaper industry. Those abuses could not be justified, and I would not try to do so.
  It was argued that, as a result of all the new technology, there would be a flourishing of new titles—a thousand flowers would bloom, and a thousand schools of thought would prevail. A number of new titles did emerge, but they are all dead now, except The Independent. Of course,The Independent is not independent any more, primarily because Mr. Murdoch unleashed a price war in a ruthless attempt to sink his rivals. That was his objective. I believe that some of that philosophy will be extended to television ownership if we let the tabloid media barons into television ownership.
  I listened to Viscount Rothermere on "Desert Island Discs" the other day. He is another whose interests would be affected by the amendments. He was idly musing whether he would allow one of his principal newspapers to support the Labour party at the general election. In a democracy, we should not need to persuade any of those people to back one political party or the other. I do not think that their stewardship of their assets has been acceptable in a democracy. I do not want them to extend their interests into television.
  Of course, the Daily Mirror has already done so in a small way. It has ventured into cable television—something that was much remarked upon in Committee.
  836
  The small audience enjoyed by its cable channel gets topless darts and Newsbunny. It is not just the same values that are being imported—it is the same people. Mr. Kelvin McKenzie now gives us junk television where before he gave us junk journalism.
  With great reluctance, I will support the Opposition amendment. It has a certain logic, but it is entirely dependent on the powers that it gives to the MMC and the ITC. When the time comes, I will, with permission, press my amendment No. 261 to a Division.
  Mr. Austin Mitchell: The choice between amendment No. 102 and amendment No. 261 is a choice between all and nothing. In effect, amendment No. 102 would allow any newspaper to take control of a television station or channel, whereas amendment No. 261 would not allow any tabloid newspaper to take control of channel 3. I support the amendment tabled by my hon. Friend the Member for Sunderland, South (Mr. Mullin), as I believe that we should exclude the tabloids from channel 3.
  Although I agree with my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) about the desire of the newspaper proprietors and the big publishing houses to become multimedia giants with a powerhouse of information at their disposal across diverse media, that is really just their science fiction dream about what they have to become for competitive reasons, rather than a wish to make a genuine contribution or to improve themselves.
  What will those people gain by becoming multimedia giants? It is fashion rather than competence. I do not know what they could possibly add to existing terrestrial television stations, which have been producing successful programmes, which have been successfully run and which have done a good job in serving their areas. They should not now be prey to takeover by giant newspaper groups. Would the newsrooms be merged? That would be disastrous for television news. The disciplines are different and the training, instincts and requirements of the journalists for balance and impartiality are different. Will there be synergy? Where can synergy possibly come from in that sort of takeover? Apart from cross-advertising between television and the newspapers, I can see no synergy. Will the quality of the journalism be improved? Will they bring the same balance, impartiality and fairness that characterise the tabloids—the Daily Mail is a classic example—to the newsrooms of television? What can they really contribute? The only experiments by the big newspaper groups in cable television have been disastrous.
  I quite like Live TV, and I watch it when I get home late at night. It has a sort of low sexual stimulation—but it certainly is not Kelvin McKenzie's finest contribution to journalism. I think that Newsbunny is a great innovation. Indeed, the Conservative Front Bench has a Newsbunny—he is called a parliamentary private secretary. He sits behind the Minister saying, "Eee, get that," as a reaction to the Minister's approach. Newsbunny is a great idea, but it is not an astounding innovation that will revolutionise television, any more than topless darts will.
  Where the media barons have experimented in television, they have made no real contribution. Channel One surely refers to the number of viewers rather than the title of the station. It is certainly not a great innovative

  837
  station. I do not believe that they can add anything to television. If they want to be international players in an international market—they tell us that they want to be big so that they can compete internationally—the only way to achieve that is to make programmes.
  The strength of this country is in production. The quality of British programming is the strength. If those people want to compete internationally, they could easily buy a production house and put money into it. Most production houses are short of money. Investment in production would make the newspaper groups international players. They do not have to own a television station and a television newsroom to make a contribution. They want to buy a slice of a monopoly to cushion themselves from the inevitable decline of print and the rise of television.
  Too often, the desire to take over television stations is a formula for failure. The formula for successful businesses is to stick to what they are good at. I do not know why newspapers do not do that. The only justification for a newspaper group getting into television is that offered by Rupert Murdoch, who has been very successful—all praise to him—because he took a risk. He saw the opportunity to put the Sky channels on the Astra satellite.
  We cannot—it would be unrealistic—penalise Rupert Murdoch for being successful, which is why I do not support amendment No. 262. He is the one person who has made a contribution to television. That powerful contribution has made all our lives and the diversity of viewing better. If other newspaper groups wanted to contribute, why did not they seize the opportunity that Murdoch seized right at the start, and get themselves on Astra?
  I live in the real world. I am new Labour. I recognise that the righteous—a group which includes me and my hon. Friend the Member for Sunderland, South—do not necessarily prevail in the real world. I do not think that our amendments will be acclaimed. The backs of the heads of my Front-Bench colleagues have been especially inscrutable while I have been speaking. They have not been nodding the sort of ready assent that I would have expected for our amendment.
  I therefore assume that we shall have to support amendment No. 102, which I hope will be successful. So we move from nothing at all to all. That is a rational position, because there is no logic in the distinction that the Government have drawn. If some newspaper groups are to be allowed in, all must be allowed in—especially the one that has made a contribution to television. The distinction is based on prejudice—prejudice against the Daily Mirror because it is Labour, and against Murdoch because he is successful. I cannot stand such prejudice on the Government's part. I shall enthusiastically support amendment No. 102, while, in my heart of hearts, wanting amendment No. 261.
  9 pm
  Ms Roseanna Cunningham: I am grateful to the hon. Member for Sunderland, South (Mr. Mullin) for using a phrase that characterises some of the interventions on amendment No. 102—he mentioned being "dazzled by technology". That is what is happening.
  838
  The hon. Member for Caithness and Sutherland (Mr. Maclennan) was right to talk about the current reality. I occasionally look at newspapers on the net but, for the foreseeable future, like everyone else, I shall get my news from actual newspapers, television and radio. That will be the case for most people for some time. To pretend otherwise is to live in a fairytale world. I suspect that my hon. Friend the Member for Banff and Buchan (Mr. Salmond) does not know his way around the Internet. That is probably true of a great many hon. Members.
  There is a certain irony in the fact that we should be debating this matter now. Clearly, six months is a long time in terms of new Labour policy, as the people of Scotland have recently discovered to their cost. Labour's backsliding referendum proposal shows how much can change. It did not take it six months to make that turnaround. The policies that were proudly proclaimed in the winter have been shed at the first sight of the sun.
  The leader of the Labour party said as recently as last year that the then shadow National Heritage Secretary, the hon. Member for Islington, South and Finsbury (Mr. Smith),
  "has already laid out the principles which should govern this area—diversity of content, plurality of ownership, regional strength, quality of programme-making and the avoidance of excessive dominance by any one company."
  I do not understand how the Labour amendment achieves any of those.
  Cross-media ownership greatly concerns many hon. Members who recognise the threat to democracy and competition inherent in large cross-media corporations. Those are grave anxieties. I suspect that we should therefore consider Labour's motives in tabling the amendment with some cynicism. I presume that Tony Blair's jaunt to the News International conference in Australia last year is now getting its pay-back.
  That Labour's amendment will favour the Murdoch press, among others, at the expense of the effective control of media ownership is a price that it seems willing to pay for the prospect of a gentler run in the forthcoming general election, as if adopting Tory policies on social and economic affairs is not going to be enough. The real lesson is: new Labour, no principles. Whether on the Scottish constitution or on this issue of media ownership, we are effectively seeing a two-faced Labour party. I am confirmed in my view that neither Tory Blair nor new Labour can be trusted.
  Mr. Deputy Speaker: Order. The hon. Lady should know that she must not refer to hon. Members by their surname.
  Ms Cunningham: I was referring to the right hon. Member for Sedgefield (Mr. Blair).
  It is hard to see how the Labour amendment can be supported by anyone. I was therefore pleased to see the amendments in the name of the hon. Member for Sunderland, South—clearly without the support of Labour Front-Bench Members. I must admit that their sentiments are preferable to the Government's proposal, which seems designed to exclude just one or two newspaper groups, but would allow others into the market.
  Amendment No. 261 would effectively prevent all UK tabloid newspapers from buying into television. The misuse of the word "national" has been frequent tonight:

  839
  many other hon. Members will agree that the United Kingdom is not a nation. The amendment would prevent cross-ownership between those UK tabloid owners and the new television services. Ultimately, that is a far better protection for democracy, which, thankfully, is still an important principle for some of us.
  Mr. Winnick: I know that the Whips are keen to proceed to a vote, so I shall not delay matters for much longer.
  Mrs. Jane Kennedy indicated assent.
  Mr. Winnick: I see that the Labour Whip on duty is nodding her head in full agreement.
  This debate, however, is one of the most important on the Bill, so there is some justification for expressing a view, however briefly. I well understand the points made by my right hon. Friend the Member for Copeland (Dr. Cunningham). Knowing the Government, I am sure that, if the Mirror group supported the Conservative party, the difficulties that my right hon. Friend seeks to resolve would not exist. The Government's political bias will come as no surprise to anyone.
  I remain extremely concerned about the vast concentration of media ownership. Many of my hon. Friends agree that far too much of the national press is already owned by a handful of powerful companies. That position has existed for some time. I therefore see no justification for further strengthening those immense powers by allowing what would be, to all intents and purposes, a free-for-all over cross-media ownership. I therefore see much merit in the amendments of my hon. Friend the Member for Sunderland, South (Mr. Mullin).
  In a democracy, it is always dangerous to allow a handful of people to have immense power.
  Mr. Kaufman: The Whips.
  Mr. Winnick: My right hon. Friend mentions the Whips, but their powers are indeed slight compared with the vast powers of those who dominate the media. It is undesirable and unhelpful when, in a parliamentary democracy, some people have the vast powers described by some hon. Members tonight. It is perfectly understandable that political parties are keen to have the support of one or two individuals who own vast numbers of newspapers and television channels. The fact that that is part of the present political process illustrates the point that I am making: it is unhealthy and undesirable. It is not possible entirely to avoid a concentration of media ownership in relatively few hands, but there are very few hands—far fewer than existed 50 years ago.
  I accept that the television regulations at least allow minimum standards to be established. Last week, I read in The Times a letter from a former chief executive of a television company, who is anxious about poor standards of popular television shows in Britain. Having been to the United States and watched some of the popular shows there, he had reached the conclusion that we were not so bad; but surely that means only that certain regulations have come into force over the years, setting minimum standards.
  This is a very important part of the Bill. The debate about whether far too few people have far too much power in this country will continue, because those of us who
  840
  share my views believe that that power should be diminished, not strengthened. That is why it is important that there should be effective powers and regulations on cross-media ownership. It is undesirable for Mr. Rupert Murdoch or others to have excessive power.
  The Government have not gone about things in the right way. My right hon. Friend the Member for Copeland made one or two valid points, but I believe that the excessive power of a few private individuals should be diminished as soon as possible, and I am not alone in that.
  Mr. Dafis: I shall be the briefest speaker of all in this important debate. It is important that I stand up and be counted, as I did in Committee.
  The situation is astonishing—or at least it would have been regarded as astonishing some time ago. An amendment that was presented in Committee by Tory free-market Back Benchers is now being brought back by Labour Front Benchers. The effect of the amendments would be identical.
  We can speculate about the motives. The rational case was presented by the right hon. Member for Manchester, Gorton (Mr. Kaufman). He spoke about the fact that the boundaries between the various media are dissolving before our eyes. The pleasant reality is that those boundaries are there, and that crossing them is a significant act.
  What of the other possible motives? The motive that I ascribed to Labour Front Benchers in Committee was to embarrass the Government by inflicting a defeat, by aligning with certain right-wing Tory Back Benchers. It did not work because on this matter I was prepared to support the Government, as was the hon. Member for Caithness and Sutherland (Mr. Maclennan).
  Labour may be trying to out-Tory the Tories—it is doing that quite a lot these days—or it may be trying to please certain powerful vested interests, for goodness knows what reasons.
  Whatever the motive for tabling the amendment, its effect would be to deregulate—a word that we often hear from Conservative Members—in a way that, I understand, the ITC does not approve of. The effect is to deregulate and, through market forces, to facilitate the process of aggregating power and influence in fewer, already very powerful, hands, in the key area of the mass media, so hugely influential on political developments, civil rights and so on.
  I and my party want no part of that. We shall associate ourselves with the purpose and spirit of amendments Nos. 260 and 261, and we shall vote against amendment No. 102.
  Mr. Sproat: The issue of the 20 per cent. national newspaper market threshold—covered by amendment No. 102—has been debated at considerable length at each stage of the Bill's passage. Our policy objective is to prevent national newspaper groups that enjoy a dominant position in the market from becoming dominant broadcasters, and vice versa.
  I have heard nothing this evening that shakes the Government's belief that it is right, in the interests of plurality and diversity, to pursue that objective. The Government also remain convinced that it is right for Parliament to give a clear idea of the cut-off point at which a newspaper group is judged to be simply too large

  841
  to be permitted to control our major broadcasters. We believe that that cut-off point should be at 20 per cent. of the national newspaper market.
  Mr. Hoon: Will the Minister explain how the Government decided that 20 per cent. was the definition of a dominant position?
  9.15 pm
  Mr. Sproat: The Government started off by saying that there should be a cut-off point—and, as the hon. Member for Ashfield (Mr. Hoon) will know, his noble Friends in the other place also reached that conclusion—whether it be 15 per cent., 20 per cent. or 25 per cent. The Labour party now suggests that there should not be a percentage, but that there should be some other test. We looked at what other countries do—the French have a 20 per cent. cut-off and the Italians have a 16 per cent. cut-off.
  We thought that 20 per cent. was a good place to start, so we fixed on that figure. We had to choose a figure because—as the hon. Member for Ceredigion and Pembroke, North (Mr. Dafis) rightly said—we do not want a dominant newspaper group to become a dominant terrestrial television group. The hon. Member for Sunderland, South (Mr. Mullin) said that the cut-off should be 10 per cent.
  As I said, the Italians have set the cut-off point at 16 per cent., the French have set it at 20 per cent. and Labour Members' noble Friends in the other place started off by saying that it should be set at 20 per cent. and then changed it to 25 per cent. I do not mind that; I am merely making the strong point that a cut-off point had to be fixed, and 20 per cent. seemed to be a decent level—there was a precedent for it.
  Mr. Kaufman: The Minister responded to the question of my hon. Friend the Member for Ashfield (Mr. Hoon) by proclaiming the virtues of 20 per cent. Why does he have the power in the Bill to change that figure? If the Government are so sure that the figure is right, why do they want the power to change it to something that they say is wrong?
  Mr. Sproat: I have no such power in the Bill. Clearly, when the convergence develops—or converges more, if I can use that tautology—it may be sensible to look at those matters again. At every stage of the Bill, we have said that what we are debating now is what seems to be best in 1996. Nothing is more certain than the fact that technology will advance, and no one proclaims that more frequently and rightly than the right hon. Member for Manchester, Gorton (Mr. Kaufman). In five years' time or less, we may return to the matter and decide that 20 per cent. is not the best level at which to fix the threshold. The hon. Member for Ashfield asked me why we chose 20 per cent. and I gave him the precedents and the options—some countries set a lower level and other countries set a higher level.
  We do not consider that it is appropriate to rely on public interest test considerations alone to regulate cross-ownership between newspapers and broadcasters, as has been suggested by some Labour Members. The general danger in doing so is that it would subject the regulators to the pressure that influence and circumstance
  842
  can bring to bear. Moreover, great uncertainty would be caused in the media market, as no one could be clear in advance what rules would be applied. Above all, any decision by the House now to remove the 20 per cent. threshold would send a clear signal to the regulators and to the courts that even a newspaper market share above that could well be perfectly compatible with owning channel 3 licences.
  I come to Government amendments Nos. 43 to 46. In Committee, the Government agreed that they would allow individuals and bodies corporate from outside the European economic area to control digital programme services and licences for television and radio. Having conceded the case for foreign ownership of digital sound programme services, I believe that it would be inequitable for us to retain the restriction preventing United Kingdom newspaper groups with a market share of 20 per cent. or more from being allowed to apply for such licences. The amendments achieve that objective.
  I come now to my hon. Friend the Member for North Thanet (Mr. Gale). I do so willingly as he has had something of a triumph with this legislation, in that he persuaded us to amend various provisions during its passage in Committee. In this case, my hon. Friend's amendment would allow a national newspaper group that was above the 20 per cent. threshold to acquire a channel 3 licence and then have a 12-month grace period from the date of the acquisition to reduce its newspaper market share. My hon. Friend asked fairly whether I would spell out the Government's position in that area. I shall do so gladly—it is a complicated matter.
  If Mirror Group Newspapers or any other group that has more than 20 per cent. of the market wants to bid for a channel 3 licence, it can certainly do so. I shall take the Daily Mirror as an example, but the same thing applies to other parties. It would go to the ITC and say, "We have 23 per cent. of the national newspaper market and we want to bid for the Loamshire Television channel 3 licence. We are prepared to divest ourselves of 3 per cent. and we shall do that by selling the following assets." The group could then divest itself of the assets immediately, or it could make the bid. It is perfectly straightforward—many companies must divest themselves of their assets under competition law because they need the cash to buy something else. There is nothing extraordinary about that.
  The group could sell its assets before it made the bid, or it could tell the ITC that it wanted to pass the conditional public interest test. It could then bid and reach an agreement with Loamshire Television. As soon as the group complied with the condition of selling its assets, it could acquire Loamshire Television. It is a perfectly straightforward process that has many precedents in other areas of commercial life. That is how it would be done—if the Mirror group or anyone else wishes to do it, they should read Hansard and see.
  Mr. Maclennan: Will the Minister address directly the comments of the chairman of the Mirror group to the Secretary of State? I shall quote from the letter that he wrote to her. He said:
  "You said that you fully understood that to do so"—
  that is, to notify the ITC in the way that the Minister suggests—
  "would signal to the world that we were likely to attempt such an acquisition. You acknowledged that, should the acquisition fail, we would be left with the worst of both worlds having sold an asset and missed our target".

  843
  For that reason, the Secretary of State accepted the submission that is embodied in the amendment tabled by the hon. Member for North Thanet (Mr. Gale).
  Mr. Sproat: If the chairman of the Mirror group were to say that to me, I would simply reply that it is normal in commercial life that, when one wishes to buy an asset, one may have to take a decision about selling another asset in order to do so. It is a perfectly straightforward commercial decision—it may not be an easy one, but it is not unusual. Companies do it all the time. If the Mirror group wants to do that, it can; if it does not, it need not.
  If the Opposition press the amendments to a vote, we shall oppose them.
  Dr. John Cunningham: The Minister has described a process which, in other circumstances, would involve providing market-sensitive information to the public. He is suggesting that Mirror Group Newspapers give a clear signal to the television sector that it is about to bid for a channel 3 licence. That is an absurd proposition, and he knows it.
  The hon. Member for Caithness and Sutherland (Mr. Maclennan) quoted from correspondence that is widely available. The Secretary of State told the Mirror group personally that she understood that the proposition would not work. It is not only that the Minister has changed his ground from the position that he took in Committee, but the Secretary of State has changed her position from the one that she took in conversations with people from the Mirror group. However the Government wriggle and twist and turn on the issue, they know that they are in a mess. The rules are not fair or rational.
  The hon. Member for Ceredigion and Pembroke, North (Mr. Dafis), who spoke for the Welsh nationalists, did not learn much or listen to much in Committee. He accused us of tabling an amendment that was tabled in Committee by two Government Back Benchers. If he had read the amendment paper properly, he would have seen that the equivalent of amendment No. 102 was tabled in Committee by my hon. Friend the Member for Kirkcaldy (Dr. Moonie). The hon. Gentleman is wrong about that.
  What actually happened in Committee was that Government Back Benchers recognised the force of the arguments of Labour Front Benchers. The hon. Member for Colchester, South and Maldon (Mr. Whittingdale) admitted that again today on television. He said that the Government's position was illogical.
  Mr. Andrew Robathan indicated dissent.
  Dr. Cunningham: It is no good the hon. Gentleman shaking his head, because we all heard the hon. Member for Colchester, South and Maldon say it.
  The reality is, as the Minister would recognise in any other circumstances, that the Government have, unwittingly or otherwise, rigged the legislation. The Bill might even be subject to legal challenge in the European Court of Justice. The Minister mentioned maintaining diversity and avoiding dominant positions, but the legislation conveniently omits to take into account the regional newspaper ownership of United Newspapers and, especially, Associated Newspapers. If their regional newspaper ownership were taken into account, they too would fall foul of the proposals.
  844
  The Minister's response to the debate was inadequate. The explanation that he gave in response to the hon. Member for North Thanet (Mr. Gale) was also inadequate. For those reasons, we shall press amendment No. 102 to a Division.
  Question put, That the amendment be made:—
  The House divided: Ayes 232, Noes 302.

  Division No. 166]

  [9.26 pm

  AYES

  Abbott, Ms Diane

  Evans, John(St Helens N)

  Adams, Mrs Irene

  Fatchett, Derek

  Ainger, Nick

  Faulds, Andrew

  Allen, Graham

  Field, Frank(Birkenhead)

  Armstrong, Hilary

  Flynn, Paul

  Ashton, Joseph

  Forsythe, Clifford(S Antrim)

  Austin-Walker, John

  Foster, Rt Hon Derek

  Banks, Tony(Newham NW)

  Foulkes, George

  Barnes, Harry

  Fraser, John

  Barron, Kevin

  Fyfe, Maria

  Battle, John

  Galbraith, Sam

  Bayley, Hugh

  Galloway, George

  Beggs, Roy

  Gapes, Mike

  Bell, Stuart

  Garrett, John

  Benn, Rt Hon Tony

  George, Bruce

  Benton, Joe

  Gilbert, Rt Hon Dr John

  Bermingham, Gerald

  Godman, Dr Norman A

  Berry, Roger

  Godsiff, Roger

  Betts, Clive

  Golding, Mrs Llin

  Boateng, Paul

  Gordon, Mildred

  Bradley, Keith

  Graham, Thomas

  Bray, Dr Jeremy

  Griffiths, Nigel(Edinburgh S)

  Brown, Gordon(Dunfermline E)

  Griffiths, Win(Bridgend)

  Brown, N(N'c'tle upon Tyne E)

  Gunnell, John

  Byers, Stephen

  Hain, Peter

  Caborn, Richard

  Hall, Mike

  Callaghan, Jim

  Hanson, David

  Campbell, Mrs Anne(C'bridge)

  Hardy, Peter

  Campbell, Ronnie(Blyth V)

  Harman, Ms Harriet

  Campbell—Savours, D N

  Hattersley, Rt Hon Roy

  Canavan, Dennis

  Henderson, Doug

  Cann, Jamie

  Heppell, John

  Chisholm, Malcolm

  Hill, Keith(Streatham)

  Church, Judith

  Hinchliffe, David

  Clapham, Michael

  Hodge, Margaret

  Clarke, Eric(Midlothian)

  Hoey, Kate

  Clarke, Tom(Monklands W)

  Hogg, Norman(Cumbernauld)

  Clelland, David

  Home Robertson, John

  Coffey, Ann

  Hood, Jimmy

  Cohen, Harry

  Hoon, Geoffrey

  Connarty, Michael

  Howarth, Alan(Strat'rd-on-A)

  Cook, Frank(Stockton N)

  Howarth, George(Knowsley North)

  Cook, Robin(Livingston)

  Howells, Dr Kim(Pontypridd)

  Corbett, Robin

  Hoyle, Doug

  Corbyn, Jeremy

  Hughes, Kevin(Doncaster N)

  Corston, Jean

  Hughes, Robert(Aberdeen N)

  Cousins, Jim

  Hughes, Roy(Newport E)

  Cummings, John

  Hutton, John

  Cunliffe, Lawrence

  lllsley, Eric

  Cunningham, Jim(Covy SE)

  Jackson, Glenda(H'stead)

  Cunningham, Rt Hon Dr John

  Jackson, Helen(Shef'ld, H)

  Darling, Alistair

  Jamieson, David

  Davidson, Ian

  Janner, Greville

  Davies, Rt Hon Denzil(Llanelli)

  Jenkins, Brian(SE Staff)

  Davies, Ron(Caerphilly)

  Jones, Barry(Alyn and D'side)

  Denham, John

  Jones, Jon Owen(Cardiff C)

  Dewar, Donald

  Jones, Martyn(Clwyd, SW)

  Dixon, Don

  Jowell, Tessa

  Donohoe, Brian H

  Kaufman, Rt Hon Gerald

  Dowd, Jim

  Keen, Alan

  Eagle, Ms Angela

  Kennedy, Jane(L'pool Br'dg'n)

  Eastham, Ken

  Khabra, Piara S

  Etherington, Bill

  Kilfoyle, Peter

  845

  Lestor, Joan(Eccles)

  Purchase, Ken

  Lewis, Terry

  Quin, Ms Joyce

  Liddell, Mrs Helen

  Radios, Giles

  Litherland, Robert

  Randall, Stuart

  Livingstone, Ken

  Raynsford, Nick

  Lloyd, Tony(Stretford)

  Robertson, George(Hamilton)

  Loyden, Eddie

  Robinson, Geoffrey(Co'try NW)

  McAllion, John

  Rogers, Allan

  McCartney, Ian

  Rooker, Jeff

  Macdonald, Calum

  Rooney, Terry

  McFall, John

  Ross, Ernie(Dundee W)

  McKelvey, William

  Rowlands, Ted

  Mackinlay, Andrew

  Sedgemore, Brian

  McLeish, Henry

  Sheerman, Barry

  MacShane, Denis

  Sheldon, Rt Hon Robert

  McWilliam, John

  Shore, Rt Hon Peter

  Madden, Max

  Short, Clare

  Mahon, Alice

  Simpson, Alan

  Mandelson, Peter

  Skinner, Dennis

  Marshall, David(Shettleston)

  Smith, Andrew(Oxford E)

  Marshall, Jim(Leicester, S)

  Smith, Chris(Isl'ton S & Fsbury)

  Martin, Michael J(Springburn)

  Smith, Llew(Blaenau Gwent)

  Martlew, Eric

  Smyth, The Reverend Martin

  Maxton, John

  Snape, Peter

  Meale, Alan

  Spearing, Nigel

  Michael, Alun

  Spellar, John

  Michie, Bill(Sheffield Heeley)

  Steinberg, Gerry

  Milburn, Alan

  Stevenson, George

  Miller, Andrew

  Sutcliffe, Gerry

  Mitchell, Austin(Gt Grimsby)

  Taylor, Mrs Ann(Dewsbury)

  Molyneaux, Rt Hon Sir James

  Taylor, Rt Hon John D(Strgfd)

  Thompson, Jack(Wansbeck)

  Moonie, Dr Lewis

  Timms, Stephen

  Morgan, Rhodri

  Touhig, Don

  Morley, Elliot

  Trickett, Jon

  Morris, Estelle(B'ham Yardley)

  Turner, Dennis

  Morris, Rt Hon John(Aberavon)

  Walker, Rt Hon Sir Harold

  Mowlam, Marjorie

  Walley, Joan

  Mudie, George

  Wardell, Gareth(Gower)

  Mullin, Chris

  Wareing, Robert N

  Oakes, Rt Hon Gordon

  Watson, Mike

  O'Brien, William(Normanton)

  Wicks, Malcolm

  O'Hara, Edward

  Williams, Rt Hon Alan(Sw'n W)

  Olner, Bill

  Wlliams, Alan W(Carmarthen)

  O'Neill, Martin

  Wilson, Brian

  Orme, Rt Hon Stanley

  Winnick, David

  Pearson, Ian

  Wise, Audrey

  Pendry, Tom

  Worthington, Tony

  Pickthall, Colin

  Wray, Jimmy

  Pike, Peter L

  Wright, Dr Tony

  Pope, Greg

  Young, David(Bolton SE)

  Powell, Sir Ray(Ogmore)

  Prentice, Bridget(Lew'm E)

  Tellers for the Ayes:

  Prentice, Gordon(Pendle)

  Ms Janet Anderson and

  Primarolo, Dawn

  Mr. Robert Ainsworth.

  NOES

  Ainsworth, Peter(East Surrey)

  Batiste, Spencer

  Aitken, Rt Hon Jonathan

  Bellingham, Henry

  Alexander, Richard

  Bendall, Vivian

  Alison, Rt Hon Michael(Selby)

  Beresford, Sir Paul

  Allason, Rupert(Torbay)

  Bonsor, Sir Nicholas

  Alton, David

  Booth, Hartley

  Amess, David

  Boswell, Tim

  Arbuthnot, James

  Bottomley, Peter(Eltham)

  Arnold, Jacques(Gravesham)

  Bottomley, Rt Hon Virginia

  Ashby, David

  Bowden, Sir Andrew

  Ashdown, Rt Hon Paddy

  Bowis, John

  Aspinwall, Jack

  Boyson, Rt Hon Sir Rhodes

  Atkins, Rt Hon Robert

  Brandreth, Gyles

  Atkinson, David(Bour'mouth E)

  Brazier, Julian

  Baker, Nicholas(North Dorset)

  Bright, Sir Graham

  Baldry, Tony

  Brooke, Rt Hon Peter

  Banks, Matthew(Southport)

  Brown, M(Brigg & Cl'thorpes)

  Banks, Robert(Harrogate)

  Browning, Mrs Angela

  Bates, Michael

  Bruce, Ian(South Dorset)

  846

  Budgen, Nicholas

  Greenway, John(Ryedale)

  Burns, Simon

  Griffiths, Peter(Portsmouth, N)

  Burt, Alistair

  Grylls, Sir Michael

  Butcher, John

  Hague, Rt Hon Wlliam

  Butler, Peter

  Hamilton, Rt Hon Sir Archibald

  Butterfill, John

  Hampson, Dr Keith

  Campbell, Menzies(Fife NE)

  Hanley, Rt Hon Jeremy

  Carlile, Alexander(Montgomery)

  Hannam, Sir John

  Carlisle, John(Luton North)

  Harvey, Nick

  Carlisle, Sir Kenneth(Lincoln)

  Haselhurst, Sir Alan

  Carttiss, Michael

  Hawkins, Nick

  Cash, William

  Hawksley, Warren

  Channon, Rt Hon Paul

  Hayes, Jerry

  Chapman, Sir Sydney

  Heald, Oliver

  Churchill, Mr

  Heathcoat—Amory, Rt Hon David

  Clappison, James

  Hendry, Charles

  Clark, Dr Michael(Rochford)

  Heseltine, Rt Hon Michael

  Clarke, Rt Hon Kenneth(Ru'clif)

  Hicks, Sir Robert

  Coe, Sebastian

  Higgins, Rt Hon Sir Terence

  Colvin, Michael

  Hill, Sir James(Southampton Test)

  Congdon, David

  Hogg, Rt Hon Douglas(G'tham)

  Conway, Derek

  Horam, John

  Coombs, Anthony(Wyre For'st)

  Hordem, Rt Hon Sir Peter

  Coombs, Simon(Swindon)

  Howell, Rt Hon David(G'dford)

  Cope, Rt Hon Sir John

  Howell, Sir Ralph(N Norfolk)

  Cormack, Sir Patrick

  Hughes, Robert G(Harrow W)

  Couchman, James

  Hughes, Simon(Southwark)

  Cran, James

  Hunt, Rt Hon David(Wirral W)

  Currie, Mrs Edwina(S D'by'ire)

  Hunt, Sir John(Ravensbourne)

  Curry, David(Skpton & Ripon)

  Hunter, Andrew

  Dafis, Cynog

  Hurd, Rt Hon Douglas

  Davies, Chris(L'Boro & S'worth)

  Jack, Michael

  Davies, Querrtin(Stamford)

  Jackson, Robert(Wantage)

  Day, Stephen

  Jenkin, Bernard

  Deva, Nirj Joseph

  Jessel, Toby

  Devlin, Tim

  Johnson Smith, Sir Geoffrey

  Dorrell, Rt Hon Stephen

  Jones, Gwilym(Cardiff N)

  Douglas—Hamilton, Lord James

  Jones, leuan Wyn(Ynys MÔn)

  Dover, Den

  Jones, Nigel(Cheltenham)

  Duncan, Alan

  Jones, Robert B(W Hertfdshr)

  Duncan Smith, lain

  Jopling, Rt Hon Michael

  Dunn, Bob

  Kellett—Bowman, Dame Elaine

  Durant, Sir Anthony

  Key, Robert

  Dykes, Hugh

  King, Rt Hon Tom

  Eggar, Rt Hon Tim

  Kirkhope, Timothy

  Elletson, Harold

  Kirkwood, Archy

  Emery, Rt Hon Sir Peter

  Knapman, Roger

  Evans, David(Welwyn Hatfield)

  Knight, Mrs Angela(Erewash)

  Evans, Jonathan(Brecon)

  Knight, Rt Hon Greg(Derby N)

  Evans, Nigel(Ribble Valley)

  Knight Dame Jill(Bir'm E'St'n)

  Evans, Roger(Monmouth)

  Knox, Sir David

  Evennett, David

  Kynoch, George(Kincardine)

  Faber, David

  Lait, Mrs Jacqui

  Fabricant, Michael

  Lamont, Rt Hon Norman

  Fenner, Dame Peggy

  Lawrence, Sir Ivan

  Field, Barry(Isle of Wight)

  Legg, Barry

  Fishburn, Dudley

  Leigh, Edward

  Forth, Eric

  Lennox—Boyd, Sir Mark

  Foster, Don(Bath)

  Lester, Sir James(Broxtowe)

  Fox, Rt Hon Sir Marcus(Shipley)

  Lidington, David

  Freeman, Rt Hon Roger

  Lilley, Rt Hon Peter

  French, Douglas

  Lloyd, Rt Hon Sir Peter(Fareham)

  Fry, Sir Peter

  Llwyd, Elfyn

  Gale, Roger

  Lord, Michael

  Gallie, Phil

  Luff, Peter

  Gardiner, Sir George

  Lyell, Rt Hon Sir Nicholas

  Garel—Jones, Rt Hon Tristan

  Lynne, Ms Liz

  Garnier, Edward

  MacGregor, Rt Hon John

  Gill, Christopher

  MacKay, Andrew

  Gillan, Cheryl

  Maclean, Rt Hon David

  Goodlad, Rt Hon Alastair

  Maclennan, Robert

  Goodson—Wickes, Dr Charles

  McLoughlin, Patrick

  Gorman, Mrs Teresa

  McNair—Wlson, Sir Patrick

  Gorst, Sir John

  Maddock, Diana

  Grant, Sir A(SW Cambs)

  Madel, Sir David

  Greenway, Harry(Ealing N)

  Maitland, Lady Olga

  847

  Malone, Gerald

  Smith, Sir Dudley(Warwick)

  Mans, Keith

  Soames, Nicholas

  Marland, Paul

  Spencer, Sir Derek

  Marlow, Tony

  Spicer, Sir James(W Dorset)

  Marshall, John(Hendon S)

  Spicer, Sir Michael(S Worcs)

  Marshall, Sir Michael(Arundel)

  Spink, Dr Robert

  Martin, David(Portsmouth S)

  Sproat, Iain

  Mates, Michael

  Squire, Robin(Hornchurch)

  Merchant, Piers

  Stanley, Rt Hon Sir John

  Michie, Mrs Ray(Argyll & Bute)

  Steel, Rt Hon Sir David

  Mills, Iain

  Steen, Anthony

  Mitchell, Andrew(Gedling)

  Stewart, Allan

  Mitchell, Sir David(NW Hants)

  Streeter, Gary

  Monro, Rt Hon Sir Hector

  Sumberg, David

  Montgomery, Sir Fergus

  Sweeney, Walter

  Moss, Malcolm

  Sykes, John

  Needham, Rt Hon Richard

  Tapsell, Sir Peter

  Nelson, Anthony

  Taylor, Ian(Esher)

  Neubert, Sir Michael

  Taylor, John M(Solihull)

  Newton, Rt Hon Tony

  Taylor, Matthew(Truro)

  Nicholls, Patrick

  Taylor, Sir Teddy(Southend, E)

  Nicholson, David(Taunton)

  Temple—Morris, Peter

  Norris, Steve

  Thompson, Sir Donald(C'er V)

  Oppenheim, Phillip

  Thompson, Patrick(Norwich N)

  Page, Richard

  Thornton, Sir Malcolm

  Paice, James

  Thurnham, Peter

  Patnick, Sir Irvine

  Townend, John(Bridlington)

  Pattie, Rt Hon Sir Geoffrey

  Townsend, Cyril D(Bexl'yh'th)

  Pawsey, James

  Tracey, Richard

  Peacock, Mrs Elizabeth

  Tredinnick, David

  Pickles, Eric

  Trend, Michael

  Porter, Barry(Wirral S)

  Trotter, Neville

  Porter, David(Waveney)

  Twinn, Dr Ian

  Portillo, Rt Hon Michael

  Tyler, Paul

  Powell, William(Corby)

  Vaughan, Sir Gerard

  Rathbone, Tim

  Viggers, Peter

  Redwood, Rt Hon John

  Waldegrave, Rt Hon William

  Rendel, David

  Walden, George

  Renton, Rt Hon Tim

  Walker, Bill(N Tayside)

  Richards, Rod

  Wallace, James

  Riddick, Graham

  Waller, Gary

  Robathan, Andrew

  Ward, John

  Roberts, Rt Hon Sir Wyn

  Waterson, Nigel

  Robertson, Raymond(Ab'd'n S)

  Watts, John

  Robinson, Mark(Somerton)

  Wells, Bowen

  Roe, Mrs Marion(Broxbourne)

  Whitney, Ray

  Rowe, Andrew(Mid Kent)

  Widdecombe, Ann

  Rumbold, Rt Hon Dame Angela

  Wiggin, Sir Jerry

  Sackville, Tom

  Wigley, Dafydd

  Sainsbury, Rt Hon Sir Timothy

  Wilkinson, John

  Scott, Rt Hon Sir Nicholas

  Willetts, David

  Shaw, David(Dover)

  Winterton, Mrs Ann(Congleton)

  Shephard, Rt Hon Gillian

  Wood, Timothy

  Shepherd, Sir Colin(Hereford)

  Yeo, Tim

  Shepherd, Richard(Aldridge)

  Shersby, Sir Michael

  Tellers for the Noes:

  Sims, Sir Roger

  Dr. Liam Fox and

  Skeet, Sir Trevor

  Mr. Richard Ottaway.

  Question accordingly negatived.
  Amendment proposed: No. 261, in page 129, line 34, leave out '20' and insert '10'.—[Mr. Mullin.]
  Question put, That the amendment be made:—
  The House divided: Ayes 73, Noes 303.

  Division No. 167]

  [9.40 pm

  AYES

  Abbott, Ms Diane

  Bayley, Hugh

  Ainger, Nick

  Benn, Rt Hon Tony

  Ashton, Joe

  Berry, Roger

  Austin-Walker, John

  Campbell, Ronnie(Blyth V)

  Banks, Tony(Newham NW)

  Campbell-Savours, D N

  Barnes, Harry

  Canavan, Dennis

  848

  Clapham, Michael

  Mackinlay, Andrew

  Clwyd, Mrs Ann

  MacShane, Denis

  Cohen, Harry

  Madden, Max

  Corbyn, Jeremy

  Mahon, Alice

  Corston, Jean

  Marek, Dr John

  Cousins, Jim

  Marshall, David(Shettleston)

  Cunningham, Roseanna

  Maxton, John

  Dafis, Cynog

  Michie, Bill(Sheffield Heeley)

  Davies, Rt Hon Denzil(Llanelli)

  Mitchell, Austin(Gt Grimsby)

  Davis, Terry(B'ham, H'dge H'l)

  Mullin, Chris

  Ewing, Mrs Margaret

  O'Brien, William(Normanton)

  Flynn, Paul

  Pickthall, Colin

  Fyfe, Maria

  Purchase, Ken

  Galloway, George

  Radice, Giles

  Gapes, Mike

  Rooney, Terry

  Godman, Dr Norman A

  Salmond, Alex

  Godsiff, Roger

  Sheldon, Rt Hon Robert

  Gordon, Mildred

  Simpson, Alan

  Hardy, Peter

  Skinner, Dennis

  Home Robertson, John

  Smith, Llew(Blaenau Gwent)

  Jackson, Helen(Shef'ld, H)

  Spearing, Nigel

  Steinberg, Gerry

  Jones, Barry(Alyn and D'side)

  Sutcliffe, Gerry

  Jones, leuan Wyn(Ynys MÔn)

  Thompson, Jack(Wansbeck)

  Jones, Lynne(B'ham S 0)

  Wigley, Dafydd

  Keen, Alan

  Williams, Alan W(Carmarthen)

  Lewis, Terry

  Winnick, David

  Litherland, Robert

  Wise, Audrey

  Livingstone, Ken

  Wray, Jimmy

  Llwyd, Elfyn

  Loyden, Eddie

  Tellers for the Ayes:

  McAllion, John

  Mr. Frank Cook and

  McKelvey, Wlliam

  Mr. Brian Sedgemore.

  NOES

  Ainsworth, Peter(East Surrey)

  Burt, Alistair

  Aitken, Rt Hon Jonathan

  Butcher, John

  Alexander, Richard

  Butler, Peter

  Alison, Rt Hon Michael(Selby)

  Butterfill, John

  Allason, Rupert(Torbay)

  Campbell, Menzies(Fife NE)

  Alton, David

  Carlile, Alexander(Montgomery)

  Amess, David

  Carlisle, John(Luton North)

  Arbuthnot, James

  Carlisle, Sir Kenneth(Lincoln)

  Arnold, Jacques(Gravesham)

  Carttiss, Michael

  Ashby, David

  Cash, William

  Ashdown, Rt Hon Paddy

  Channon, Rt Hon Paul

  Aspinwall, Jack

  Chapman, Sir Sydney

  Atkins, Rt Hon Robert

  Churchill, Mr

  Atkinson, David(Bour'mouth E)

  Clappison, James

  Baker, Nicholas(North Dorset)

  Clark, Dr Michael(Rochford)

  Baldry, Tony

  Clarke, Rt Hon Kenneth(Ru'clif)

  Banks, Matthew(Southport)

  Coe, Sebastian

  Banks, Robert(Harrogate)

  Colvin, Michael

  Bates, Michael

  Congdon, David

  Batiste, Spencer

  Conway, Derek

  Beggs, Roy

  Coombs, Anthony(Wyre For'st)

  Bellingham, Henry

  Coombs, Simon(Swindon)

  Bendall, Vivian

  Cope, Rt Hon Sir John

  Beresford, Sir Paul

  Cormack, Sir Patrick

  Bonsor, Sir Nicholas

  Couchman, James

  Booth, Hartley

  Cran, James

  Boswell, Tim

  Currie, Mrs Edwina(S D'by'ire)

  Bottomley, Peter(Eltham)

  Curry, David(Skipton & Ripon)

  Bottomley, Rt Hon Virginia

  Davies, Chris(L'Boro & S'worth)

  Bowden, Sir Andrew

  Davies, Quentin(Stamford)

  Bowis, John

  Day, Stephen

  Boyson, Rt Hon Sir Rhodes

  Deva, Nirj Joseph

  Brandreth, Gyles

  Devlin, Tim

  Brazier, Julian

  Dorrell, Rt Hon Stephen

  Bright, Sir Graham

  Douglas-Hamilton, Lord James

  Brooke, Rt Hon Peter

  Dover, Den

  Brown, M(Brigg & Cl'thorpes)

  Duncan, Alan

  Browning, Mrs Angela

  Dunn, Bob

  Bruce, Ian(South Dorset)

  Durant, Sir Anthony

  Budgen, Nicholas

  Dykes, Hugh

  Burns, Simon

  Eggar, Rt Hon Tim

  849

  Elletson, Harold

  Kirkhope, Timothy

  Emery, Rt Hon Sir Peter

  Kirkwood, Archy

  Evans, David(Welwyn Hatfield)

  Knight, Mrs Angela(Erewash)

  Evans, Jonathan(Brecon)

  Knight, Rt Hon Greg(Derby N)

  Evans, Nigel(Ribble Valley)

  Knight, Dame Jill(Bir'm E'st'n)

  Evans, Roger(Monmouth)

  Knox, Sir David

  Evennett, David

  Kynoch, George(Kincardine)

  Faber, David

  Lait, Mrs Jacqui

  Fabricant, Michael

  Lamont, Rt Hon Norman

  Fenner, Dame Peggy

  Lawrence, Sir Ivan

  Field, Barry(Isle of Wight)

  Legg, Barry

  Fishburn, Dudley

  Leigh, Edward

  Forsythe, Clifford(S Antrim)

  Lennox-Boyd, Sir Mark

  Forth, Eric

  Lester, Sir James(Broxtowe)

  Foster, Don(Bath)

  Lidington, David

  Fox, Rt Hon Sir Marcus(Shipley)

  Lilley, Rt Hon Peter

  Freeman, Rt Hon Roger

  Lloyd, Rt Hon Sir Peter(Fareham)

  French, Douglas

  Lord, Michael

  Fry, Sir Peter

  Luff, Peter

  Gale, Roger

  Lyell, Rt Hon Sir Nicholas

  Gallie, Phil

  Lynne, Ms Liz

  Gardiner, Sir George

  MacGregor, Rt Hon John

  Garel—Jones, Rt Hon Tristan

  MacKay, Andrew

  Garnier, Edward

  Maclean, Rt Hon David

  Gill, Christopher

  Maclennan, Robert

  Gillan, Cheryl

  McLoughlin, Patrick

  Goodlad, Rt Hon Alastair

  McNair-Wilson, Sir Patrick

  Goodson—Wickes, Dr Charles

  Maddock, Diana

  Gorman, Mrs Teresa

  Madel, Sir David

  Gorst, Sir John

  Maitland, Lady Olga

  Grant, Sir A(SW Cambs)

  Malone, Gerald

  Greenway, Harry(Ealing N)

  Mans, Keith

  Greenway, John(Ryedale)

  Marland, Paul

  Griffiths, Peter(Portsmouth, N)

  Marlow, Tony

  Grylls, Sir Michael

  Marshall, John(Hendon S)

  Hague, Rt Hon William

  Marshall, Sir Michael(Arundel)

  Hamilton, Rt Hon Sir Archibald

  Martin, David(Portsmouth S)

  Hampson, Dr Keith

  Mates, Michael

  Hanley, Rt Hon Jeremy

  Merchant, Piers

  Hannam, Sir John

  Michie, Mrs Ray

  Harvey, Nick

  Mills, Iain

  Haselhurst, Sir Alan

  Mitchell, Andrew(Gedling)

  Hawkins, Nick

  Mitchell, Sir David(NW Hants)

  Hawksley, Warren

  Molyneaux, Rt Hon Sir James

  Hayes, Jerry

  Monro, Rt Hon Sir Hector

  Heald, Oliver

  Montgomery, Sir Fergus

  Heathcoat—Amory, Rt Hon David

  Moss, Malcolm

  Hendry, Charles

  Needham, Rt Hon Richard

  Heseltine, Rt Hon Michael

  Nelson, Anthony

  Hicks, Sir Robert

  Neubert, Sir Michael

  Higgins, Rt Hon Sir Terence

  Newton, Rt Hon Tony

  Hill, Sir James(Southampton Test)

  Nicholls, Patrick

  Hogg, Rt Hon Douglas(G'tham)

  Nicholson, David(Taunton)

  Horam, John

  Norris, Steve

  Hordem, Rt Hon Sir Peter

  Oppenheim, Phillip

  Howard, Rt Hon Michael

  Ottaway, Richard

  Howell, Rt Hon David(G'dford)

  Page, Richard

  Howell, Sir Ralph(N Norfolk)

  Paice, James

  Hughes, Robert G(Harrow W)

  Patnick, Sir Irvine

  Hughes, Simon(Southwark)

  Pattie, Rt Hon Sir Geoffrey

  Hunt, Rt Hon David(Wirral W)

  Pawsey, James

  Hunt, Sir John(Ravensbourne)

  Peacock, Mrs Elizabeth

  Hunter, Andrew

  Pickles, Eric

  Hurd, Rt Hon Douglas

  Porter, Barry(Wirral S)

  Jack, Michael

  Porter, David(Waveney)

  Jenkin, Bernard

  Portillo, Rt Hon Michael

  Jessel, Toby

  Powell, William(Corby)

  Johnson Smith, Sir Geoffrey

  Rathbone, Tim

  Jones, Gwilym(Cardiff N)

  Redwood, Rt Hon John

  Jones, Nigel(Cheltenham)

  Rendel, David

  Jones, Robert B(W Hertfdshr)

  Renton, Rt Hon Tim

  Jopling, Rt Hon Michael

  Richards, Rod

  Kaufman, Rt Hon Gerald

  Riddick, Graham

  Kellett—Bowman, Dame Elaine

  Robathan, Andrew

  Key, Robert

  Roberts, Rt Hon Sir Wyn

  King, Rt Hon Tom

  Robertson, Raymond(Ab'd'n S)

  850

  Robinson, Mark(Somerton)

  Taylor, Sir Teddy(Southend, E)

  Roe, Mrs Marion(Broxbourne)

  Temple—Morris, Peter

  Rowe, Andrew(Mid Kent)

  Thompson, Sir Donald(C'er V)

  Rumbold, Rt Hon Dame Angela

  Thompson, Patrick(Norwich N)

  Sackville, Tom

  Thornton, Sir Malcolm

  Sainsbury, Rt Hon Sir Timothy

  Thumham, Peter

  Scott, Rt Hon Sir Nicholas

  Townend, John(Bridlington)

  Shaw, David(Dover)

  Townsend, Cyril D(Bexl'yh'th)

  Shephard, Rt Hon Gillian

  Tracey, Richard

  Shepherd, Sir Colin(Hereford)

  Tredinnick, David

  Shepherd, Richard(Aldridge)

  Trend, Michael

  Shersby, Sir Michael

  Trotter, Neville

  Sims, Sir Roger

  Twinn, Dr Ian

  Skeet, Sir Trevor

  Tyler, Paul

  Smith, Sir Dudley(Warwick)

  Vaughan, Sir Gerard

  Smyth, The Reverend Martin

  Viggers, Peter

  Soames, Nicholas

  Waldegrave, Rt Hon William

  Spencer, Sir Derek

  Walden, George

  Spicer, Sir James(W Dorset)

  Walker, Bill(N Tayside)

  Spicer, Sir Michael(S Worcs)

  Wallace, James

  Spink, Dr Robert

  Waller, Gary

  Sproat, Iain

  Ward, John

  Squire, Robin(Hornchurch)

  Waterson, Nigel

  Stanley, Rt Hon Sir John

  Watts, John

  Wells, Bowen

  Steel, Rt Hon Sir David

  Whitney, Ray

  Steen, Anthony

  Whittingdale, John

  Stewart, Allan

  Widdecombe, Ann

  Streeter, Gary

  Wilkinson, John

  Sumberg, David

  Willetts, David

  Sweeney, Walter

  Winterton, Mrs Ann(Congleton)

  Sykes, John

  Wood, Timothy

  Tapsell, Sir Peter

  Yeo, Tim

  Taylor, Ian(Esher)

  Taylor, Rt Hon John D(Strgfd)

  Tellers for the Noes:

  Taylor, John M(Solihull)

  Dr. Liam Fox and Mr. Roger Knapman.

  Taylor, Matthew(Truro)

  Question accordingly negatived.
  Amendments made: No. 43, in page 129, line 35, at end insert 'or'.
  No. 44, in page 129, line 36, leave out from 'service' to end of line 37.—[Mr. Brandreth.]
  Mr. Gale: On a point of order, Mr. Deputy Speaker. My hon. Friend the Minister has been extremely generous in his concessions throughout the Bill and I am sorry that he has felt unable to meet me on this issue, but I have to respect his views. I have also had the benefit of the arithmetic of the last Division, so it would be unreasonable to force the House to another Division at this time of night. I do not, therefore, intend to press my amendment.
  Amendment proposed: No. 162, in page 129, line 41, at end insert—
  '(2A) If as a result of a takeover a person who owns or controls newspapers with a circulation market share above the percentage specified in paragraphs 4(1) and (2) becomes the holder of a licence to provide a Channel 3 service, the Independent Television Commission shall not for that reason alone revoke that licence unless a period of 12 months from the takeover has elapsed and the newspaper proprietor has failed to reduce the market share of those newspapers he controls to below the specified percentage.'.—[Mr. Maclennan.]
  Question put, That the amendment be made:—
  The House divided: Ayes 172, Noes 273.

  851

  Division No. 168]

  [9.52 pm

  AYES

  Abbott, Ms Diane

  Golding, Mrs Llin

  Adams, Mrs Irene

  Gordon, Mildred

  Anger, Nick

  Graham, Thomas

  Answorth, Robert(Cov'try NE)

  Griffiths, Nigel(Edinburgh S)

  Allen, Graham

  Gunnell, John

  Alton, David

  Hain, Peter

  Ashdown, Rt Hon Paddy

  Hanson, David

  Ashton, Joe

  Hardy, Peter

  Austin-Walker, John

  Harvey, Nick

  Banks, Tony(Newham NW)

  Hattersley, Rt Hon Roy

  Barnes, Harry

  Hinchliffe, David

  Battle, John

  Hodge, Margaret

  Beggs, Roy

  Hoey, Kate

  Benn, Rt Hon Tony

  Hogg, Norman(Cumbernauld)

  Benton, Joe

  Home Robertson, John

  Betts, Clive

  Hood, Jimmy

  Boateng, Paul

  Hoon, Geoffrey

  Bradley, Keith

  Howarth, Alan(Strafrd-on-A)

  Bray, Dr Jeremy

  Howells, Dr Kim(Pontypridd)

  Brown, N(N'c'tle upon Tyne E)

  Hughes, Kevin(Doncaster N)

  Cabom, Richard

  Hughes, Robert(Aberdeen N)

  Callaghan, Jim

  Hughes, Simon(Southwark)

  Campbell, Mrs Anne(C'bridge)

  Hutton, John

  Campbell, Menzies(Fife NE)

  lllsley, Eric

  Campbell-Savours, D N

  Jackson, Glenda(H'stead)

  Canavan, Dennis

  Jackson, Helen(Shef'ld, H)

  Carlile, Alexander(Montgomery)

  Jamieson, David

  Chidgey, David

  Jones, Barry(Alyn and D'side)

  Chisholm, Malcolm

  Jones, leuan Wyn(Ynys MÔn)

  Church, Judith

  Jones, Lynne(B'ham S O)

  Clapham, Michael

  Jones, Martyn(Clwyd, SW)

  Clarke, Eric(Midlothian)

  Jones, Nigel(Cheltenham)

  Clarke, Tom(Monklands W)

  Jowell, Tessa

  Clelland, David

  Kaufman, Rt Hon Gerald

  Clwyd, Mrs Ann

  Keen, Aan

  Coffey, Ann

  Kennedy, Jane(L'pool Br'dg'n)

  Cohen, Harry

  Lestor, Joan(Eccles)

  Connarty, Michael

  Lewis, Terry

  Cook, Frank(Stockton N)

  Livingstone, Ken

  Cook, Robin(Livingston)

  Uwyd, Elfyn

  Corbett, Robin

  McAllion, John

  Corbyn, Jeremy

  Macdonald, Calum

  Corston, Jean

  McKelvey, William

  Cousins, Jim

  Mackinlay, Andrew

  Cummings, John

  McLeish, Henry

  Cunningham, Jim(Covy SE)

  Maclennan, Robert

  Cunningham, Roseanna

  MacShane, Denis

  Dafis, Cynog

  Madden, Max

  Davidson, Ian

  Maddock, Diana

  Davies, Chris(L'Boro & S'worth)

  Mahon, Alice

  Davies, Rt Hon Denzil(Llanelli)

  Marek, Dr John

  Dewar, Donald

  Marshall, David(Shettleston)

  Dixon, Don

  Martlew, Eric

  Donohoe, Brian H

  Maxton, John

  Eagle, Ms Angela

  Meale, Alan

  Etherington, Bill

  Michael, Alun

  Evans, John(St Helens N)

  Michie, Mrs Ray(Argyll & Bute)

  Ewing, Mrs Margaret

  Miller, Andrew

  Faulds, Andrew

  Molyneaux, Rt Hon Sir James

  Field, Frank(Birkenhead)

  Moonie, Dr Lewis

  Flynn, Paul

  Morley, Elliot

  Forsythe, Clifford(S Antrim)

  Mowlam, Marjorie

  Foster, Rt Hon Derek

  Mullin, Chris

  Foster, Don(Bath)

  O'Brien, William(Normanton)

  Foulkes, George

  Olner, Bill

  Fraser, John

  Pendry, Tom

  Fyfe, Maria

  Pike, Peter L

  Gale, Roger

  Prentice, Bridget(Lew'm E)

  Galloway, George

  Radice, Giles

  Gapes, Mike

  Rendel, David

  Garrett, John

  Rooker, Jeff

  George, Bruce

  Rooney, Terry

  Godman, Dr Norman A

  Salmond, Alex

  852

  Sedgemore, Brian

  Wallace, James

  Sheerman, Barry

  Walley, Joan

  Sheldon, Rt Hon Robert

  Wardell, Gareth(Gower)

  Simpson, Alan

  Watson, Mike

  Skinner, Dennis

  Welsh, Andrew

  Smith, Chris(Isl'ton S & F'sbury)

  Wigley, Dafydd

  Smith, Llew(Blaenau Gwent)

  Williams, Aan W(Carmarthen)

  Smyth, The Reverend Martin

  Winnick, David

  Spearing, Nigel

  Wise, Audrey

  Steinberg, Gerry

  Worthington, Tony

  Taylor, Matthew(Truro)

  Young, David(Bolton SE)

  Timms, Stephen

  Trickett, Jon

  Tellers for the Ayes:

  Turner, Dennis

  Mr. Arehy Kirkwood and

  Tyler, Paul

  Ms Liz Lynne.

  NOES

  Ainsworth, Peter(East Surrey)

  Currie, Mrs Edwina(S D'by'ire)

  Alexander, Richard

  Curry, David(Skipton & Ripon)

  Aison, Rt Hon Michael(Selby)

  Davies, Quentin(Stamford)

  Allason, Rupert(Torbay)

  Day, Stephen

  Amess, David

  Deva, Nirj Joseph

  Arbuthnot, James

  Devlin, Tim

  Arnold, Jacques(Gravesham)

  Dorrell, Rt Hon Stephen

  Ashby, David

  Douglas-Hamilton, Lord James

  Atkins, Rt Hon Robert

  Dover, Den

  Atkinson, David(Bour'mouth E)

  Duncan, Aan

  Baker, Nicholas(North Dorset)

  Duncan Smith, lain

  Baldry, Tony

  Dunn, Bob

  Banks, Matthew(Southport)

  Durant, Sir Anthony

  Banks, Robert(Harrogate)

  Dykes, Hugh

  Bates, Michael

  Eggar, Rt Hon Tim

  Batiste, Spencer

  Elletson, Harold

  Bellingham, Henry

  Emery, Rt Hon Sir Peter

  Bendall, Vivian

  Evans, David(Welwyn Hatfield)

  Beresford, Sir Paul

  Evans, Jonathan(Brecon)

  Bonsor, Sir Nicholas

  Evans, Nigel(Ribble Valley)

  Booth, Hartley

  Evans, Roger(Monmouth)

  Boswell, Tim

  Evennett, David

  Bottomley, Peter(Eltham)

  Faber, David

  Bottomley, Rt Hon Virginia

  Fabricant, Michael

  Bowden, Sir Andrew

  Fenner, Dame Peggy

  Bowis, John

  Held, Barry(Isle of Wight)

  Boyson, Rt Hon Sir Rhodes

  Fishburn, Dudley

  Brandreth, Gyles

  Forth, Eric

  Brazier, Julian

  Fox, Dr Liam(Woodspring)

  Bright, Sir Graham

  Fox, Rt Hon Sir Marcus(Shipley)

  Brooke, Rt Hon Peter

  Freeman, Rt Hon Roger

  Brown, M(Brigg & Cl'thorpes)

  French, Douglas

  Browning, Mrs Angela

  Fry, Sir Peter

  Bruce, Ian(South Dorset)

  Gallie, Phil

  Budgen, Nicholas

  Gardiner, Sir George

  Burns, Simon

  Garel—Jones, Rt Hon Tristan

  Burt, Alistair

  Garnier, Edward

  Butcher, John

  Gill, Christopher

  Butler, Peter

  Gillan, Cheryl

  Butterfill, John

  Goodlad, Rt Hon Alastair

  Carlisle, John(Luton North)

  Goodson—Wickes, Dr Charles

  Carlisle, Sir Kenneth(Lincoln)

  Gorman, Mrs Teresa

  Carttiss, Michael

  Gorst, Sir John

  Cash, William

  Grant, Sir A(SW Cambs)

  Channon, Rt Hon Paul

  Greenway, Harry(Ealing N)

  Chapman, Sir Sydney

  Greenway, John(Ryedale)

  Clappison, James

  Griffiths, Peter(Portsmouth, N)

  Clark, Dr Michael(Rochford)

  Grytls, Sir Michael

  Clarke, Rt Hon Kenneth(Ru'clif)

  Gummer, Rt Hon John Selwyn

  Coe, Sebastian

  Hague, Rt Hon William

  Colvin, Michael

  Hamilton, Rt Hon Sir Archibald

  Congdon, David

  Hampson, Dr Keith

  Conway, Derek

  Hanley, Rt Hon Jeremy

  Coombs, Anthony(Wyie For'st)

  Hannam, Sir John

  Coombs, Simon(Swindon)

  Haselhurst, Sir Aan

  Cope, Rt Hon Sir John

  Hawkins, Nick

  Cormack, Sir Patrick

  Hawksley, Warren

  Couchman, James

  Hayes, Jerry

  Cran, James

  Heald, Oliver

  853

  Heathcoat-Amory, Rt Hon David

  Norris, Steve

  Hendry, Charles

  Oppenheim, Phillip

  Hicks, Sir Robert

  Ottaway, Richard

  Higgins, Rt Hon Sir Terence

  Page, Richard

  Hill, Sir James(Southampton Test,)

  Paice, James

  Hogg, Rt Hon Douglas(G'tham)

  Patnick, Sir Irvine

  Horam, John

  Pattie, Rt Hon Sir Geoffrey

  Hordem, Rt Hon Sir Peter

  Pawsey, James

  Howard, Rt Hon Michael

  Peacock, Mrs Elizabeth

  Howell, Rt Hon David(G'dford)

  Pickles, Eric

  Howell, Sir Ralph(N Norfolk)

  Porter, Barry(Wirral S)

  Hughes, Robert G(Harrow W)

  Porter, David(Waveney)

  Hunt, Rt Hon David(Wirral W)

  Portillo, Rt Hon Michael

  Hunt, Sir John(Ravensbourne)

  Powell, William(Corby)

  Hunter, Andrew

  Rathbone, Tim

  Hurd, Rt Hon Douglas

  Redwood, Rt Hon John

  Jack, Michael

  Renton, Rt Hon Tim

  Jenkin, Bernard

  Richards, Rod

  Jessel, Toby

  Riddck, Graham

  Johnson Smith, Sir Geoffrey

  Robatnan, Andrew

  Jones, Gwilym(Cardiff N)

  Roberts, Rt Hon Sir Wyn

  Jones, Robert B(W Hertfdshr)

  Robertson, Raymond(Ab'd'n S)

  Jopling, Rt Hon Michael

  Robinson, Mark(Somerton)

  Kellett-Bowman, Dame Elaine

  Roe, Mrs Marion(Broxbourne)

  Key, Robert

  Rowe, Andrew(Mid Kent)

  King, Rt Hon Tom

  Rumbold, Rt Hon Dame Angela

  Kirkhope, Timothy

  Sackville, Tom

  Knight, Mrs Angela(Erewash)

  Sainsbury, Rt Hon Sir Timothy

  Knight, Rt Hon Greg(Derby N)

  Scott, Rt Hon Sir Nicholas

  Shaw, David(Dover)

  Knight, Dame Jill(Bir'm E'st'n)

  Shephard, Rt Hon Gillian

  Knox, Sir David

  Shepherd, Sir Colin(Hereford)

  Kynoch, George(Kincardine)

  Shepherd, Richard(Aldridge)

  Lait, Mrs Jacqui

  Shersby, Sir Michael

  Lamont, Rt Hon Norman

  Sims, Sir Roger

  Lawrence, Sir Ivan

  Skeet, Sir Trevor

  Legg, Barry

  Smith, Sir Dudley(Warwick)

  Leigh, Edward

  Soames, Nicholas

  Lennox-Boyd, Sir Mark

  Spencer, Sir Derek

  Lester, Sir James(Broxtowe)

  Spicer, Sir James(W Dorset)

  Lidington, David

  Spink, Dr Robert

  Lilley, Rt Hon Peter

  Sproat, lain

  Lloyd, Rt Hon Sir Peter(Fareham)

  Squire, Robin(Hornchurch)

  Lord, Michael

  Stanley, Rt Hon Sir John

  Luff, Peter

  Steen, Anthony

  Lyell, Rt Hon Sir Nicholas

  Stewart, Allan

  MacGregor, Rt Hon John

  Streeter, Gary

  MacKay, Andrew

  Sumberg, David

  Maclean, Rt Hon David

  Sweeney, Walter

  McNair—Wilson, Sir Patrick

  Sykes, John

  Madel, Sir David

  Tapsell, Sir Peter

  Maitland, Lady Olga

  Taylor, Ian(Esher)

  Malone, Gerald

  Taylor, John M(Solihull)

  Mans, Keith

  Taylor, Sir Teddy(Southend, E)

  Marland, Paul

  Temple-Morris, Peter

  Marlow, Tony

  Thompson, Sir Donald(C'er V)

  Marshall, John(Hendon S)

  Thompson, Patrick(Norwich N)

  Marshall, Sir Michael(Arundel)

  Thornton, Sir Malcolm

  Martin, David(Portsmouth S)

  Thurnham, Peter

  Mates, Michael

  Townend, John(Bridlington)

  Merchant, Piers

  Townsend, Cyril D(Bexl'yh'th)

  Mills, lain

  Tracey, Richard

  Mitchell, Andrew(Gedling)

  Tredinnick, David

  Mitchell, Sir David(NW Hants)

  Trend, Michael

  Monro, Rt Hon Sir Hector

  Trotter, Neville

  Montgomery, Sir Fergus

  Twinn, Dr Ian

  Moss, Malcolm

  Vaughan, Sir Gerard

  Needham, Rt Hon Richard

  Viggers, Peter

  Nelson, Anthony

  Waldegrave, Rt Hon William

  Neubert, Sir Michael

  Walden, George

  Newton, Rt Hon Tony

  Walker, Bill(N Tayside)

  Nicholls, Patrick

  Waller, Gary

  Nicholson, David(Taunton)

  Ward, John

  854

  Waterson, Nigel

  Winterton, Mrs Ann(Congleton)

  Watts, John

  Wood, Timothy

  Wells, Bowen

  Yeo, Tim

  Whitney, Ray

  Widdecombe, Ann

  Tellers for the Noes:

  Wilkinson, John

  Mr. Patrick McLoughlin and

  Willetts, David

  Mr. Roger Knapman.

  Question accordingly negatived.
  It being after Ten o'clock, further consideration of the Bill stood adjourned.
  Motion made, and Question put forthwith, pursuant to Standing Order No. 14 (Exempted business),
  That, at this day's sitting, the Broadcasting Bill[Lords] may be proceeded with, though opposed, until any hour.—[Mr. Wells.]
  Question agreed to.
  As amended (in the Standing Committee), again considered.
  Amendments made: No. 155, in page 129, line 47, leave out from beginning to end of line 5 on page 130.
  No. 45, in page 130, line 26, at end insert 'and'.
  No. 46, in page 130, line 27, leave out from 'services' to end of line 28.
  No. 156, in page 130, line 39, at end insert—
  'Holding of local radio licence by person running local newspapers with at least 50 per cent local market share
  5A.—(1) A licence to provide a local radio service may not be held by a person who runs a local newspaper which has, or local newspapers which for the time being together have, a local market share of 50 per cent. or more in the coverage area of the service unless—

  (a) the service in question shares a potential audience with another local radio service, but

  (b) he does not hold any other licence to provide a local radio service whose coverage area is to any extent the same as the coverage area of the service in question.

  (2) The reference in sub-paragraph (1) to sharing a potential audience shall be construed in accordance with paragraph 12(5) in Part III of this Schedule.
  (3) For the purposes of this paragraph a person shall be treated as holding a licence if the licence is held by a person connected with him.'
  No. 157, in page 131, line 10, at end insert—
  '(5) This paragraph has effect subject to paragraph 6A.

  Power by order to impose different restrictions in place of paragraph 6
  6A.—(1) The Secretary of State may by order provide that, where a digital sound programme service is provided in any area, the holding, by a person who runs a local newspaper or local newspapers as mentioned in paragraph 6(1), of two or more licences to provide in that area local radio services which for the purposes of paragraph 6 share a potential audience with each other or with each of the others shall, instead of being subject to the restrictions specified in paragraph 6, be subject to other restrictions specified in the order.
  (2) For the purposes of any order under sub-paragraph (1), a person shall be treated as holding a licence if the licence is held by a person connected with him.'
  No. 67, in page 131, line 22, leave out from beginning to 'that' in line 23 and insert 'permitted period'.—[Mr. Wood.]
  Mr. Deputy Speaker (Mr. Michael Morris): I shall now call amendment No. 68—
  Dr. Moonie: I am on my feet, Mr. Deputy Speaker. I want to speak on amendment No. 67.
  Mr. Deputy Speaker: It is too late. Voices have to be heard—physical movement is not enough.
  Amendments made: No. 68, in page 131, leave out lines 37 to 40 and insert—
  `(5) Subject to sub-paragraph (6), in this paragraph "the permitted period" means a period beginning with the day on which the licence holder becomes, or becomes connected with, the proprietor of the national or local newspaper ("the relevant day") and ending—

  (a) in a case where the licence holder has, before the relevant day, notified the relevant authority that he will become, or become connected with the proprietor of that national or local newspaper on that day, at the end of the period of three months beginning with the relevant day, or

  (b) in any other case, at the end of the period of three months beginning with the day on which the licence holder notifies the relevant authority that he has become, or has become connected with, the proprietor of that national or local newspaper.

  (6) The relevant authority may in a particular case, after consultation with the licence holder, notify him before the time when the permitted period would (apart from this sub-paragraph) have ended that the permitted period in that case is to be calculated as if the references in sub-paragraph (5) to three months were references to such longer period specified in the notification as the relevant authority reasonably consider necessary in the circumstances.'
  No. 69, in page 131, line 40, at end insert—
  '() Nothing in any of the preceding provisions of this Schedule shall be construed as affecting the operation of this paragraph or paragraph 8 or 9.'
  No. 70, in page 131, line 51, leave out from beginning to 'that' in line 52 and insert 'permitted period'.
  No. 71, in page 132, line 17, leave out from first 'the' to 'that' in line 18 and insert 'permitted period'.
  No. 72, in page 132, leave out lines 36 to 41. No. 73, in page 132, line 44, at end insert—
  '(8) In this paragraph "the permitted period" has the meaning given by paragraph 7(5) and (6).'
  No. 74, in page 132, line 48, leave out 'relevant authority' and insert 'Commission'.
  No. 75, in page 132, line 48, leave out from 'determine' to first 'that' in line 51 and insert
  `before the end of the period specified in sub-paragraph (1A)'.
  No. 76, in page 132, line 52, at end insert—
  `(1A) The period referred to in sub-paragraph (1) is the period of three months beginning with the day on which the Commission are notified pursuant to section 19(3) of the 1996 Act of an agreement to provide the digital programme service, or such longer period beginning with that day as the Commission may in a particular case, after consultation with the licence holder, notify him during those three months as being the period which they reasonably consider necessary in the circumstances.'
  No. 77, in page 133, line 4, leave out `relevant authority' and insert 'Commission'.
  No. 78, in page 133, line 4, leave out from first 'the' to 'that' in line 6 and insert 'permitted period'.
  No. 79, in page 133, line 22, leave out 'relevant authority' and insert 'Commission'.
  No. 80, in page 133, line 22, leave out from first 'the' to 'that' in line 24 and insert 'permitted period'.
  No. 81, in page 133, line 41, leave out lines 41 to 44 and insert—
  `(6) In this paragraph—

  (a) references to a relevant local newspaper shall be construed in accordance with paragraph 8(7), and

  856

  (b) "the permitted period" has the meaning given by paragraph 7(5) and (6).'.

  No. 82, in page 133, line 52, leave out `9(2)' and insert `9(1), (2)'.
  No. 83, in page 134, line 21, leave out '9(2)' and insert `9(1), (2)'.
  No. 84, in page 134, line 24, leave out '9(2)' and insert `9(1), (2)'.
  No. 85, in page 135, line 3, leave out '9(2)' and insert `9(1), (2)'.
  No. 158, in page 135, line 5, at end insert—

  'Restricted television services
  .—(1) The Secretary of State may by order—

  (a) prescribe restrictions on the holding of one or more licences to provide restricted television services by a person who runs a national or local newspaper, and

  (b) apply any of the provisions of paragraphs 7 to 11, with such modifications as may be specified in the order., in relation to the holding of a licence to provide a restricted television service.

  (2) Any order under sub-paragraph (1) may provide that, for the purposes of any provision of the order, a person is to be treated as holding a licence if the licence is held by a person connected with him.

  (3) In this paragraph "restricted television service" means a restricted service within the meaning of Part I of this Act:—[Mr. Wood.]

Clause 73

  VARIATION OF REGIONAL CHANNEL 3 LICENCE FOLLOWING CHANGE OF CONTROL
  Amendments made: No. 159, in page 64, line 39, leave out
  `imposed under subsection (1) or section 5(2)(d)'
  and insert
  `in a regional Channel 3 licence'.
  No. 160, in page 64, line 45, leave out 'without that change having' and insert
  `(whether or not that change has'.
  No. 161, in page 66, leave out lines 25 to 28 and insert—
  '(8) Where, in a case falling within subsection (2)(a), a notice under subsection (3) or (4) varying a licence is served before the change to which it relates takes place, the variation shall not take effect until the change takes place.'—[Mr. Wood.]

Clause 79

  EXTENSION OF POWERS OF CHANNEL FOUR TELEVISION CORPORATION AND SIANEL PEDWAR CYMRU
  Amendments made: No. 93, in page 70, line 26, after `power' insert—
  '(a)".
  No. 94, in page 70, line 28, after 'form' insert
  `in any part of the United Kingdom'.
  No. 95, in page 70, line 29, at end insert
  `and
  (b) to establish qualifying companies, to purchase or otherwise acquire shares, stocks or other securities of qualifying companies and to assist any qualifying company.

  857
  (6) In subsection (5)(b) "qualifying company" means any company (whether incorporated under the law of the United Kingdom or of any other country) which is or will be wholly or mainly engaged in one or more of the following activities

  (a) the provision of one or more services which are licensed by the Commission or by the Radio Authority or which, if provided in the United Kingdom, would be required to be so licensed,

  (b) activities incidental to such provision, and

  (c) the holding of shares in any other company which is wholly or mainly engaged in such provision or in activities incidental to such provision."

  (1A) In paragraph 1 of Schedule 3 to the 1990 Act (status and capacity of Channel Four Television Corporation) after subparagraph (3) there is inserted—
  "(4) Section 24(5)(b) of this Act shall not be taken to limit the Corporation's power by virtue of subp-paragraph (3) to do such things and enter into such transactions as are incidental or conducive to the discharge of their functions under section 24(1) or (5)(a)." '
  No. 96, in page 70, leave out lines 37 to 43 and insert—
  `(b) to establish qualifying companies, to purchase or otherwise acquire shares, stocks or other securities of qualifying companies and to assist any qualifying company.
  (1B) In subsection (1A)(b) "qualifying company" means any company (whether incorporated under the law of the United Kingdom or of any other country) which is or will be wholly or mainly engaged in one or more of the following activities—

  (a) the provision of one or more services which are licensed by the Commission or by the Radio Authority or which, if provided in the United Kingdom, would be required to be so licensed,

  (b) activities incidental to such provision, and

  (c) the holding of shares in any other company which is wholly or mainly engaged in such provision or in activities incidental to such provision." ' —[Mr. Wood.]

Clause 83

  ENFORCEMENT OF LICENCES TO PROVIDE NON-DOMESTIC SATELLITE SERVICES
  Mr. Rowlands: I beg to move amendment No. 216, in page 73, line 20, after 'determined', insert
  `, subject to subsection (6B) below'.
  Mr. Deputy Speaker: With this, it will be convenient to discuss the following amendments: No. 217, in page 73, line 28, at end insert—
  '(6B) Where the payments received or to be received by the licence holder in connection with the licensed service derive wholly or mainly from the sale of goods or the supply of services not falling within subsection (2)(a) or (2)(b) of section 19, the qualifying revenue of the licence holder shall be determined in accordance with the principles set out in the statement referred to in Part I of Schedule 7".'.
  No. 218, in clause 85, page 74, line 44, after `determined', insert
  `, subject to subsection (9B) below'.
  No. 219, in page 75, line 7, at end insert—
  '(9B) Where the payments received or to be received by the licence holder in connection with the licensed service derive wholly or mainly from the sale of goods or the supply of services not falling within subsection (2)(a) or (2)(b) of section 19, the qualifying
  858
  revenue of the licence holder shall be determined in accordance with the principles set out in the statement referred to in Part I of Schedule 7".'.
  Mr. Rowlands: My amendment involves a point that I raised in Committee. The Minister said that he would consider it, but he has not responded. The ITC wishes to pursue the question of whether the qualifying revenues in clauses 83 and 85 cover revenues from home shopping channels. I would be grateful if he could answer that point.[Interruption.] Does the Minister wish me to elaborate further?
  Mr. Sproat: In the general uproar, I could not hear what the hon. Gentleman was saying. Perhaps he could swiftly repeat his point.
  Mr. Rowlands: In Committee, I asked whether, under clauses 83 and 85, home shopping channel revenues counted as qualifying revenues in respect of the £50,000 fines. The Minister promised that he would find out whether the ITC had a point. The fines involve a sum of up to £50,000 or up to a specified percentage of the qualifying revenue as defined in section 19 of the Broadcasting Act 1990. That includes advertising sponsorship and subscription income. The ITC is concerned about whether the large and growing home shopping channel revenues will be covered by the fines.
  Mr. Sproat: I thank the hon. Gentleman for his courtesy in repeating his question. The answer is no.
  Mr. Rowlands: I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.

Schedule 3

  THE BROADCASTING STANDARDS COMMISSION: SUPPLEMENTARY PROVISIONS
  Amendments made: No. 86, in page 138, leave out lines I and 2.
  No. 87, in page 139, line 4, leave out from 'State' to end of line.—[Mr. Wood.]

Schedule 5

  TRANSFER SCHEMES RELATING TO BBC TRANSMISSION NETWORK: SUPPLEMENTARY PROVISIONS
  Amendments made: No. 10, in page 143, line 45, at end insert—
  '(aa) rights and liabilities of the BBC under any agreement or arrangement for the payment of pensions, allowances and gratuities, '.
  No. 141, in page 149, line 17, at end insert—

  'Consideration for transfer etc.
  10.—(1) A transfer in accordance with a transfer scheme may be made for consideration or for no consideration and, if it is made for consideration, the consideration may, in particular, take the form of the issue of shares or securities.
  (2) In sub-paragraph (1), "transfer" has the meaning given by paragraph 1(1) of Schedule (Transfer schemes relating to the BBC transmission network: taxation provisions).'.—[Mr. Wood.]

Clause 127

  AGREEMENTS WITH RESPECT TO TRANSFER SCHEMES
  Amendment made: No. 139, in page 105, line 33, at end insert
  ', or the issue of shares or securities,'.—[Mr. Wood.]

Clause 133

  GENERAL INTERPRETATION
  Amendment made: No. 253, in page 109, line 24, after `sections' insert
  `(Standards for transmission systems) and'.—[Mr. Wood.]

Schedule 7

  MINOR AND CONSEQUENTIAL AMENDMENTS
  Amendments made: No. 11, in page 151, line 31, after 'paragraph (b)' insert—
  '(i)".
  No. 12, in page 151, line 32, at end insert—
  '(ii) after "television programme services" there is inserted "and multiplex services (as defined by section 1(1) of that Act), and
  (iii) for "such services" there is substituted "television programme services.'.
  No. 214, in page 151, line 47, at end insert—
  '. In section 72 of the 1990 Act (local delivery services), in subsection (2)—
  (a) after paragraph (c) there is inserted—
  "(cc) any digital programme service (as defined by section 1(4) of the Broadcasting Act 1996);", and
  (b) at the end there is inserted "and
  (f) any digital sound programme service (as defined by section 36(5) of the Broadcasting Act 1996)." '
  No. 13, in page 152, line 20, at end insert 'digital sound programme'.
  No. 88, in page 152, line 26, at end insert—
  `. In section 112 of the 1990 Act (licensable sound programme services), in subsection (2)(a), after "sound broadcasting service" there is inserted "or a radio multiplex service (as defined by section 36(1) of the Broadcasting Act 1996)".'
  No. 89, in page 152, line 29, at end insert—
  `. In section 176 of the 1990 Act (duty to provide advance information about programmes), in subsection (7), in the first column of the table—

  (a) after "Welsh Authority" there is inserted "and the service referred to in section 57(1A)(a)", and

  (b) after "Radio Authority" there is inserted ", any simulcast radio service (within the meaning of Part II of the Broadcasting Act 1996), and any national digital sound programme service (within the meaning of that Part of that Act) subject to regulation by the Radio Authority" '.

  No. 97, in page 153, line 5, after 'company' insert
  ', a Channel 4 company'.
  No. 98, in page 153, line 13, after 'the BBC' insert—
  '() in relation to a Channel 4 company, the Channel Four Television Corporation,'
  No. 90, in page 153, line 16, after 'inserted ",' insert
  `a multiplex service (as defined by section 1(1) of the Broadcasting Act 1996),'.
  No. 99, in page 153, line 30, after 'BBC company' insert
  ', a Channel 4 company'.
  No. 100, in page 153, line 36, after 'the BBC' insert—
  '() in relation to a Channel 4 company, the Channel Four Television Corporation,'
  No. 101, in page 153, line 42, at end insert—
  '() after the definition of "broadcast" there is inserted—
  "a Channel 4 company" means—

  (a) any body corporate which is controlled by the Channel Four Television Corporation, or

  (b) any body corporate in which the Corporation or any body corporate falling within paragraph (a) above is (to any extent) a participant (as defined in paragraph 1(1) of Part I of Schedule 2);" '. —[Mr. Wood.]

Schedule 8

  REPEALS
  Amendments made: No. 47, in page 156, line 45, column 3, after 'it,' insert
  `in subsection (10) the words from "and for this purpose" onwards,'.
  No. 215, in page 156, line 49, column 3, at end insert
  `In section 72(2)(d), the word "and".'.
  No. 48, in page 157, line 24, at end insert—
  `S.I. 1991/1246 The Cable (Excepted The whole order.' Programmes) Order 1991.—[Mr. Wood.]

Clause 135

  COMMENCEMENT AND TRANSITIONAL PROVISIONS
  Amendments made: No. 7, in page 109, line 31, at end insert—
  `() paragraphs 6 to 8 of Schedule 2 so far as relating to BBC companies (as defined by section 202(1) of the 1990 Act), and section 69 so far as relating to those paragraphs in their application to such companies,'.
  No. 91, in page 109, line 35, at end insert—
  `() section(Modification of Restrictive Trade Practices Act 1976 in its application to agreements relating to Channel 3 news provision),'.
  No. 140, in page 109, line 36, after '5' insert
  `, (Transfer schemes relating to the BBC transmission network: taxation provisions)'.
  No. 164, in page 109, line 36, after '5' insert
  `, (Transfer schemes relating to the BBC transmission network: successor companies)'.—[Mr. Wood.]

Clause 136

  SHORT TITLE AND EXTENT>
  Amendment made: No. 252, in page 110, line 8, after `Act' insert
  `except paragraph 24 of Schedule 7'.—[Mr. Wood.]

  Title
  Amendment made: No. 172, in title, line 6, after `interest' insert
  `to amend in other respects the law relating to the provision of television and sound programme services'.—[Mr. Wood.]
  Order for Third Reading read.
  Motion made, and Question proposed, That the Bill be now read the Third time.—[Mrs. Virginia Bottomley.]
  10.16 pm
  Dr. Moonie: An old dog can be taught new tricks. May I sum up the proceedings as briefly as possible?
  First, I wish to raise an important point in the hope that, when the Secretary of State replies, she can give some indication to the ITC on it. Some amendments concerned the need for the ITC to apply its test to a cross-holding, irrespective of its size. I have a letter from the ITC, which says:
  "The purpose of these amendments is to address a defect in paragraph 7(3) of Part IV of Schedule 2. At present if the ITC is notified of a cross-holding, no matter how small a share of the market the acquisition or start up represents, it has to apply the test. If subsequently the same broadcaster acquires a further large cross-holding, the ITC is then debarred from conducting a further test unless a different broadcasting interest is also involved."
  It would seem logical that, in certain circumstances, say, if a company buys 1 or 2 per cent. of a licence, it is not worth while wasting time applying the test, yet the ITC is forced to do so. If the same company then moves and buys 50 per cent. of a licence, the ITC is no longer allowed to apply the test. The ITC should be given some discretion to decide when it is appropriate to apply the test and when it is not. If some direction can be given to it without it appearing in the Bill, it would benefit all concerned.
  We have had an interesting few months since Second Reading. We had a long Committee stage and what appeared at times to be an even longer Report stage, although it accelerated towards the end. Despite our initial misgivings, some of which persist, our view has remained unchanged: in principle, we support the Bill and therefore have no intention of asking the House to divide on this issue. However, it is worth going over some of the changes that have been achieved in the Bill. I do not propose to try to claim all those as fantastic victories for the Opposition, as that is not the case. Although one or two are, I shall simply refer to them in a fairly neutral fashion because the Bill has been improved beyond all recognition during its passage through the Committee and on Report. That is the function of detailed scrutiny of legislation.
  Statutory instruments have now been laid before the House in draft form on conditional access. I confess that I have not examined them in great detail, but they appear to be very good and meet most, if not all, of the concerns that we raised in Committee. I am glad of that. We shall see whether that remains so or whether the ingenuity of those who are supposed to be regulated by them finds some way round a measure that obviously will have widespread support in the House.
  We welcome the reserve powers on technical standards that have been given to the ITC. We accept the arguments that a common set-top box, although ideal, may be a fantasy—something that we cannot realise in practice. At least giving the ITC reserve powers to determine technical standards has ensured that, if problems are seen to arise and if industry is unable to arrive at a consensus as to how the technological developments should take place, it has the powers to step in and try to do something about it. Everyone will welcome that.
  We welcome the link to the provisions in the Broadcasting Act 1990 on quality, to which the Secretary of State has given at least ringing verbal support.
  862
  [Interruption.] Rather less ringing, it appears. Perhaps I had better go back and read exactly what the Minister said, but it sounded fairly ringing to us the last time that she gave it.
  We are glad that the mechanism for review of switch-off dates has been clarified. That is a very important point, which will raise public concern as time goes by. I could refer to items such as the single nominated news provider for channel 3, which is a welcome clarification of the position, and the protection of news access to sporting events and of channel 3 regions in the event of their being taken over, which was very welcome to many of my hon. Friends and I am sure to Conservative Members.
  Some detailed improvements have been made to the position of S4C on digital. I am sure that my hon. Friend the Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) will wish to refer to that if he is lucky enough to catch your eye, Mr. Deputy Speaker. He will have to be here, of course, but I am sure that he will have returned to the Chamber by that time.
  The Channel 4 funding formula arrangements have been clarified, if not necessarily yet resolved. There is the question of future privatisation of that organisation. Perhaps, in the not too distant future, the Government will be prepared to enlighten us as to their intentions. I am convinced that Mr. Grade would be very grateful for that, to enable him to plan for the future. We welcome the must carry provisions that have been introduced on cable. I speak personally when I say that the extra space that has been allocated for Gaelic broadcasting in Scotland will find great favour in vast areas of the country, and I hope that it will be improved in future.
  Last but not least was the Minister of State's commitment today to review the perceived anomalies in television licensing. Such a review is long overdue, and we look forward to hearing more about it very soon.
  Deficiencies remain in the Bill, which are inevitable, given its size and complexity. We are very disappointed that the Government saw fit to water down the commitment to people with sensory disabilities. I accept to some extent the logic of their argument that such things may be hard to do, but I believe that technological change is occurring at such a rate that this will seem to have been a bit mean-spirited in the not too distant future.
  We are very disappointed that BBC employees were not given the. assurances that they sought on pension rights. Such assurances have been given in every other recent privatisation. It would not have taken much effort to set those people's minds at rest.
  Although we welcome our victory in another place on sporting events, which the Government accepted, we feel that our failure to carry the day on Report on the other changes that we want to the coverage of sporting events will ensure an inexorable decline in the general public's ability to watch popular sporting events on free to air television. That is to be deplored.
  Despite the arguments advanced by other parties, we still believe that the cross-media ownership regulations are arbitrary and discriminatory. I hope that, when they are tested, as I hope that they will be, in the European Court, the Government get another bloody nose from that organisation and are forced to change their mind yet again.

  863
  The single biggest remaining problem with digital terrestrial television is whether it will ever get off the ground. The Labour party supports the principle—as do the Government—but we are dubious as to whether it will fly. Last week, David Elstein, the head of programming at BSkyB, said in The House Magazine:
  "Digital terrestrial television is an industrial dead end … no broadcaster has any serious expectation that digital terrestrial will happen."
  At least with this Bill, if nothing else, we are giving it a chance to happen—and that is all we can do at present. We can only give it a chance and hope that it will confound the pessimists and take off. Although I am not a natural pessimist—as hon. Members can tell by looking at me—I am somewhat pessimistic about the chances of digital terrestrial television.
  We have consulted many people in this regard—as I am sure the Government have—and they share our concerns as to whether digital terrestrial television will fly. We believe that digital satellite and digital cable may well be a reality long before digital terrestrial television. That is why we need to have a legislative and regulatory regime that is able to cope with a rapidly changing environment. Broadcasting will continue to change quickly, particularly as near super-highway services are developing.
  During the course of the Bill, the Government have said that there will need to be another such Bill in the future—the success or failure of digital terrestrial television will determine just how soon that new legislation will have to be introduced.
  I thank my hon. Friends for their sterling support in Committee and on Report. We may not have seen eye to eye on every issue, but we generally managed to arrive at a consensus. I thank them all from the bottom of my heart for their support.
  10.26 pm
  Sir Wyn Roberts: I compliment the Government on safeguarding the Welsh language—provision has been made for it through S4C and the BBC's contribution to that service. I express my gratitude to my right hon. Friend the Secretary of State for National Heritage and to her colleague the Minister of State.
  Some problems still have to be ironed out—such as the operation of the multiplex and the transmission coverage—but the general framework, with regard to the share of the multiplex and financing, is satisfactory so far as we can tell at this stage. We are standing on the threshold of the digital era. That era will be highly competitive, and I am not sure that our analogue broadcasters have fully grasped just how intensely competitive it may be. However, they have an in-built advantage in that they are already in the field and have an assured place in the digital spectrum. They have been given priority, but I have no doubt that others will challenge them.
  A fundamental rule in a competitive situation is that people should look to the quality of their product—if they are good enough, they will win through and they will hold on to their audience. We must give viewers not necessarily what we think they should have or what they want, but, if possible, what they have not dreamed of—that was Shakespeare's recipe for success, and it still holds good. There will always be jockeying for advantage among competitive broadcasters.
  864
  As far as Wales is concerned, I have a great deal of sympathy with HTV, which has a heavy licence cost and faces the prospect of losing some £6 million in revenue from Channel 4. It must ensure that its changed circumstances are taken fully into account in the re-negotiation of its licence fee. That is the solution to its problem, and I am sure that it is aware of it.
  I refer to the BBC in Wales. It is plaintive because it cannot get on the network as frequently as it would wish. That is the position now—it has nothing to do with digital, radio or television. I regret its lack of success as much as anyone in networking because it has some performers of outstanding quality. Essentially, it is an internal problem for the BBC to sort out. I would like to see more English programmes about Wales. That would please Welsh viewers in the first instance and then, I hope, secure recognition elsewhere. I cannot believe that
  "All the air things wear
  That built this world of Wales"—
  as Gerard Manley Hopkins put it—does not contain infinite possibilities for good programming for those with creative minds.
  10.29 pm
  Mr. Kaufman: The Secretary of State was wise to say nothing in introducing the Third Reading of the Bill as there is little to be said for it. I think that my hon. Friend the Member for Kirkcaldy (Dr. Moonie), in his kindly way, was overgenerous in his comments about it. The Bill has been washed up rather than passed: it is part of television's past. Although it has sections relating to digital television, they hold the fort rather than look to the future.
  Since the Bill began its passage through Parliament, there have been huge changes in the communications scene—including in television and broadcasting—in this country. However, those changes appear to have had little or no impact on the Bill, despite the many amendments that the Government have made to it. We are seeing a change in the television climate that makes the Bill largely irrelevant.
  When Independent Television was introduced 40 years ago, it was a revolution. It doubled the number of television channels and changed the nature of, and the approach to, broadcasting. We shall soon have Channel 5, but a new television channel is no longer a revolution—it is a possibly interesting increment. During the Bill's passage, the scope of non-terrestrial television has expanded. The number of viewers who are linked up either by satellite or by cable has increased during that time and will continue to increase after the Bill becomes law. There will be 12 more satellite channels this autumn—a number introduced by Granada and one by Warner Bros.
  Recent developments—which are highly relevant to discussions about the sporting events that have taken place—reveal the direction in which we are moving and the increasing irrelevance of the Bill even before it becomes law. This country has witnessed its first pay television sporting event—the Bruno-Tyson fight—and, although BSkyB did not make money on it, 600,000 people paid —9.95 to watch it. That is the way of the future.
  The Premier league has sold its television rights for the next four years to BSkyB—with highlights rights to the BBC—for a much greater price than it paid for them when

  865
  it entered into the present five-year contract. It is only a four-year contract this time. With the arrival of digital television, the Premier league clubs do not want to be excluded from broadcasting their own matches on pay per view—as they may be doing in the new century.
  Rugby league has changed from a winter to a summer game simply because it proved more lucrative when selling television rights. The Rugby Union game has been turned upside down by the perfectly legitimate purchase of its television rights by BSkyB. While that is going on and while we are arguing about who shall own ITV channels, ITV is shrinking. The ITV audience has shrunk substantially and it will shrink even more. The BBC audience is shrinking too, and it will shrink even more. My hon. Friend the Member for Kirkcaldy was accurate when he said that the prospects for digital terrestrial television are not great. The prospects for satellite digital television are far greater, especially with the possibility of the launch of a new satellite, which Mr. Murdoch will use.
  Meanwhile, the BBC, which has made grandiloquent statements about the future of digital terrestrial television, does not have any money to launch digital terrestrial television. It has talked nonsense about obtaining the huge sums of money required from the private finance initiative and by economies on candle ends within the organisation. That shows how unrealistic and impractical the present BBC regime is and how increasingly unfit it is to run the BBC, which has also been shown by the serious attack on the World Service that the BBC has now undertaken.
  The National Heritage Select Committee will shortly decide whether to conduct a new inquiry into the BBC and, like the inquiry that we conducted three years ago, it will inevitably be an inquiry into the whole subject of communications. When we conducted our last inquiry, we set the pattern for much of the activity that has taken place since and I hope that we shall be able to do that again. Indeed, some of the Government's setbacks on the Bill, to which my hon. Friend the Member for Kirkcaldy referred, would not have happened if the Government had had the good sense to pay greater attention to the Select Committee reports.
  The problem with the Bill is not that it is a bad Bill, but that even as it completes its House of Commons stages it is becoming increasingly irrelevant to what will happen to the media, television and communications industry. The Government who will be elected next year will have to bring in the next broadcasting Bill and I hope that that Government will understand the need for vision in dealing with the subject, because vision has been sadly missing from the Bill.
  10.36 pm
  Mr. Gale: It is a pity that the right hon. Member for Manchester, Gorton (Mr. Kaufman) has been so uncharacteristically churlish, because many people have put a lot of hard work into the Bill. His remarks were wholly out of keeping with the courteous and constructive approach of the Opposition Front-Bench team, certainly in Committee. I wish to thank my right hon. Friend the Secretary of State and my hon. Friends the Ministers for the courtesy and consideration that they have shown, throughout the passage of the Bill, to the suggestions made by—it is fair to say—hon. Members from both sides of the House, on the Floor of the House and in discussions.
  866
  Few of us feel that the Bill has not been improved during its passage. It was never going to be a perfect piece of legislation because, as the right hon. Member for Gorton rightly said, the technology has changed as we have been speaking and will continue to do so. The right hon. Gentleman is profoundly wrong because the future is not in satellite, which is merely a delivery system. The long-term future will be in fully interactive cable services, but that remains to be seen.
  The Bill, when it becomes an Act, will create a framework for the development of digital television for the digital future of communications. Those who have the courage to invest in that digital future will justly and rightly reap the rewards. If we have achieved that, we will have achieved a great deal.
  10.38 pm
  Mr. Kevin Hughes: I want briefly to refer to radio licensing and, in particular, a local radio station. Last year, the Radio Authority reconsidered the franchise covering my constituency, the Doncaster area. It advertised for a local radio station for the Doncaster area. At that time it was served by a Sheffield station called Radio Hallam.
  There were two bidders for a local radio station in Doncaster. Doncaster has a population of around 300,000, and the metropolitan borough is, geographically, the largest in Britain. If that is put together with neighbouring areas, the population would be about 500,000. The Radio Authority, after advertising for a local station, saw fit to give the licence back to the regional radio station, Radio Hallam. Therefore, Doncaster still does not have a local radio station. Instead, it has three regional stations—Radio Hallam, Great Yorkshire Gold and Kiss FM. I understand that the Radio Authority's decision was challenged and one of the bidders sought a judicial review. Unfortunately, the Radio Authority's decision was upheld. Recently, the Radio Authority has said that there may be an opportunity to reconsider the Doncaster situation.
  When I met the Radio Authority's chief executive he tried to fob me off with a small garden-shed medium-wave-type station which most hon. Members know would probably not get off the ground. We need an FM station with decent coverage; a decent commercial radio which could do the business, make money and provide a service for the Doncaster area.
  I raise this matter because, the Radio Authority having agreed to reconsider the situation, at least one of the bidders is still interested in providing a proper commercial radio station to cover the Doncaster and Bassetlaw area. I do not want the Radio Authority to fob the people of Doncaster off yet again. We are not an outpost of Sheffield. We are fed up with being thought of as one. We have three regional radio stations. The Doncaster evening paper is basically The Star of Sheffield, with an additional two or three sheets.
  I should like the Secretary of State to bang some heads together at the Radio Authority and tell it that if it intends to advertise for a local radio station for Doncaster again, it should award it to a station that will promise to provide a radio station for the Doncaster people, not yet another regional radio station. We already have three of those and we do not want any more.
  10.42 pm
  Mr. Robert Key: I intervene briefly to hand out some medals and to flag up an issue. I have medals for my right hon. Friend the Secretary of State, her Ministers and the staff of the Department of National Heritage for this remarkable Bill which has achieved a great deal. Legislation will never lead the technological way. It will always be the other way round, I suspect. But I have watched the Bill from the sidelines and it has made remarkable progress. I had hoped that it would address a particular problem, but it has not, so we shall have to wait for the next broadcasting Bill.
  I want to flag up the fact that most of the effort seems to go into Britain's highly populated urban areas. However, many people in the United Kingdom live in sparsely populated areas which will never be cabled and where it will probably be impossible to receive satellite programmes, but who cannot receive the news and current affairs programmes which apply to them. I raise this on behalf of my constituents in Wylye, Steeple Langford, Hanging Langford and Amesbury. They cannot receive their local news from the BBC or from commercial television. They have to receive somebody else's local news in which they are completely uninterested. That must have an impact on the advertising revenue of the commercial stations.
  I suspect that the problem will not be addressed by digital terrestrial stations, nor by the technology that is currently available, but it must be addressed somehow. It is not for me to say how, but I am quite sure that someone will find a solution. I shall return to the issue in the next broadcasting Bill on behalf of my constituents and the hundreds of thousands of people who must be in similar circumstances wherever there is a boundary problem.
  I congratulate the Government on an excellent Bill that will benefit many people and technologies. It will add lustre to Britain's tradition of leading the world in broadcasting technology.
  10.45 pm
  Mrs. Anne Campbell: I shall be brief. The Broadcasting Bill has raised an interesting mixture of technical and political issues. We have touched on several matters that have not been mentioned so far on Third Reading such as our failed attempt to strengthen the equal opportunities provisions. I hope that we shall redress that, perhaps in the next broadcasting Bill.
  I would offer my congratulations to the hon. Member for Harrow, West (Mr. Hughes) on persuading the Government to relent on the facilities for people with disabilities, particularly in respect of subtitling, signing and audio description for people with vision disabilities. That was a major triumph for which many people will be grateful for many years to come.
  I am sorry that we did not succeed in amending the Bill to strengthen the notion of quality, as it is a key issue. There has to be a balance between quality and hard commercial decisions, particularly when they involve new technology that is not certain to get off the ground. However, most of us feel that any effort that is put into providing digital terrestrial television would include the facility to produce high-quality programmes.
  Parliament is always better at being reactive rather than pro-active and I regret that we have not been able to take account of the way in which the technology is developing.
  868
  Several hon. Members referred to converging technologies—telephony, computers and television—but few of us are in a position to make projections as to the implications of those converging technologies.
  We shall need another broadcasting Bill within a short time as the way in which the Government have framed the clauses on cross-media ownership will prove unworkable and will become totally irrelevant within two years.
  Reference has been made to set-top boxes and open standards. I expect that manufacturers are convinced that open standards are a good idea. If they were not convinced before, they will have been persuaded by the fact that IBM licensed its operating system to other manufacturers and made a great deal of money, whereas Apple Mac chose to remain technically isolated and lost its market share. There are two lessons to be learnt from that. First, open standards work and can be advantageous in the market and secondly, technical superiority does not necessarily prevail. It is rather curious that the market does not always win. Most people who are familiar with computing technology would agree that Apple Mac is far superior to IBM, yet IBM has triumphed because of its marketing rather than its technical quality.
  I shall not delve into today's lobby on the BBC World Service—if I did so, you would no doubt rule me out of order, Madam Deputy Speaker, as the Bill does not specifically mention the World Service—but I am sure that we shall all want to debate the subject in the coming months. Certainly, people who have been here today have made strong representations about the need to preserve the quality of the World Service.
  10.49 pm
  Mr. John Greenway: I did not expect us to have an opportunity to debate the Bill on Third Reading. I apologise for not being present at the beginning of the debate.
  Like my hon. Friend the Member for North Thanet (Mr. Gale), I served on the Standing Committee that considered the Bill that became the Broadcasting Act 1990. As an adviser to Yorkshire-Tyne Tees Television, however, I felt unable to serve on the Committee that considered this Bill: the future of Yorkshire-Tyne Tees Television's ownership is clearly affected by some its provisions.
  The real question, which has been lost in many debates on the Bill, is why we should have such a Bill at all. Essentially its purpose is to provide a framework for digital television, and in that respect the Government must be congratulated: we seem to be ahead of the game compared with other western European countries. As my hon. Friend the Member for North Thanet said, it is impossible through legislation to drive what will happen in either technology or the market, but at least when the Bill is passed, Britain will have a framework. As our debates on the 1990 legislation made clear, people talk of prescribing quality, but it is impossible to guarantee where the money will come from to pay for that quality.
  The lesson that we have learnt over the past five or six years, in radio as much as in television, is that those in the industry know far better than us politicians what will work and what the British people, as viewers and listeners, will accept, support and subscribe to. It is somewhat ironic that Classic FM, although never

  869
  prescribed in the 1990 legislation, has had such a success with only a glimmer of a legislative framework establishing what it should do. It has been successful because those who run it know how to run a radio station.
  One of the main arguments during our debates on the Bill has concerned the future of Channel 4. When we debated the 1990 legislation, we were accused of giving Channel 4 an opportunity to secure its own advertising revenue, and of effectively selling it down the river. We put its remit on the statute book, and by and large that has worked. Channel 4 has been extremely successful in selling its own air time, to the point where channel 3 is receiving money back from it instead of the money going the other way. That should tell us that, while we have a close interest in the quality of our broadcast media, we often underestimate the ability of the talented people in broadcasting to know what works best. As a result of that ability we have some of the best broadcasting in the world, and we are all concerned about its future.
  As the right hon. Member for Manchester, Gorton (Mr. Kaufman) pointed out, there are clouds on the horizon that we cannot ignore and I shall deal with two. We have not dealt with them in the Bill, but that is not the end of the world: we can still consider them. First, there is a gross inequality in what some channel 3 licence holders pay for the right to hold a licence. We should have provided for an early review of the matter, but that is still possible; we do not have to put it in the Bill.
  Secondly, there is a gross anomaly because channel 3 pays almost £400 million a year to the Treasury while BSkyB, Channel 4 and other commercial broadcasters pay nothing. We must look ahead five or 10 years. As the right hon. Member for Gorton has said, if the ITV audience continues to shrink, as it must when all the other channels come on stream, what will be the ultimate solution? There will have to be a more equitable take of advertising revenue across the television spectrum and more people are beginning to realise that. That is as important for the Chancellor as what we pass in the Bill. The House will need to return to that.
  My hon. Friend the Member for Salisbury (Mr. Key) alluded to the fact that in many ways new technology is great for urban areas but does not do much for rural areas. In large areas of my constituency, one planning restriction or another means that a satellite dish cannot be put on the roof. Cable television is 10 to 15 years down the line, but large parts of north Yorkshire will not be able to receive Channel 5 unless my hon. Friend the Minister for Science and Technology, whom I am glad to see in his place, and his Department agree to release channel 35 in the spectrum to Channel 5. That channel will be in direct competition with Yorkshire-Tyne Tees Television. Perhaps I should conclude on that happy note.
  The Government are to be congratulated on producing the framework for digital television, but it was inevitable that such a Bill would raise many other issues. We have debated some of them and have left others for another day.
  10.56 pm
  Mr. Andrew Miller: It has been fascinating to take part in the debates on the Bill. I have thoroughly enjoyed working with hon. Members of all parties in the past few months. I congratulate my hon.
  870
  Friends the Members for Kirkcaldy (Dr. Moonie) and for Ashfield (Mr. Hoon). As shadow Ministers, they do not have the resources that are available to the Minister of State, whom I congratulate on grabbing pieces of paper from thin air and quickly absorbing their contents and on moving amendments at a rate of knots.
  I do not mean to be disrespectful to the Minister when I say that the Bill has been legislation on the hoof. The way in which we deal with such matters shows that there is an underlying weakness in our procedures. Fast-moving technology meant that some of the Government's first ideas were overtaken by events and better ideas emerged. A good example of my concern occurred last night when we dealt with sensory impairment. I intervened on the Secretary of State during that debate. There was good will among all parties when we dealt with the clause relating to that, but we were not able to address some of the technical issues on the delivery of resources. We could not even answer some of the basic questions about the cost of the requisite technology. That was unfortunate.
  My right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) correctly explained how technology has taken a grip on the media. In Committee, I raised that issue in the context of local services in my area. Local newspapers are owned by Trinity Holdings, which has a monopoly on all such newspapers in my area. I do not regard that as a threat because it has exercised proper editorial control over the various parts of its empire and there is a diversity of newspapers in the region. It may seek to take a share in or buy a radio station—there is plenty of swapping and changing in this sector. Again, if it kept that clear editorial control, that would not be a problem. The public interest issue needs to be dealt with in the context of such companies seeking to give viewers, listeners and readers the same thing, with one particular editorial slant. Clearly, that is not in the public interest.
  Our problem with the cross-media ownership debate, some of which became more heated than anything else during an interesting Committee, was that we were starting not with a blank sheet of paper but with a hotch-potch of different mixes of media ownership throughout the country and in different mediums. As a consequence, the debate was about what were, after all, arbitrary figures. That shows that we have not been able to deal adequately with some of the important issues.
  In Committee, the hon. Member for Dover (Mr. Shaw) referred, in an exchange, I think, with the Minister, to the Internet site of The Daily Telegraph. What comprises the circulation of The Daily Telegraph? Is it made up just of the hard copies that it sells to people through its normal outlets? Does it include the 100,000 copies, or whatever the figure is, that it gives away to British Rail customers, or does it include its Internet site? It is difficult to give a definition of circulation.
  The same is true of some of the more sophisticated magazine sites on the Internet. Where does one draw the boundaries between what is conventionally a magazine in hard copy, what is in electronic form and, increasingly, magazines that provide electronic clips? When we have video on demand on the television networks, we will be able to watch a film or a news item at our leisure and when we choose to do so. Broadcasting and magazines will become remarkably close.
  One of the weaknesses of this complicated sector is the procedures that we have used. I commend to hon. Members the report of the Hansard Society Commission

  871
  on the legislative process, which was published in, I think, 1991. In appendix 5, it sets out a case study on the Broadcasting Act 1990 and gives some good reasons why legislation such as this requires a different approach. It makes an extremely powerful argument that we should have hearings from experts during the passage of such legislation in future. I hope that Procedure Committee members will consider the matter carefully in the context of that case study of the Broadcasting Act and of this Bill.
  The Minister does not entirely disagree with my view. In an interesting exchange of letters, I brought to his attention an essay that I was using as a source, unusually because it was written by Boutros Boutros-Ghali. In our exchange of correspondence, the Minister agreed that, in this sector, the methodology that we were adopting was a weakness. I hope that I am not misinterpreting what he said.
  In Committee, the Minister said:
  "However, I remind members of the Committee that we are dealing with an interim Bill. No one here is in any doubt but that we shall have to return to the issue within the next three, four or five years."
  I intervened and said, "In two years." The Minister said:
  "The hon. Member for Ellesmere Port and Neston says two years, and he could well be right."—[Official Report, Standing Committee D, 4 June 1996; c. 462]
  That is the difficulty. It is interim legislation in an area of rapid change.
  We have debated a number of particularly important issues. Obviously, the role of the media in a democracy and free society is important. We need to exploit the technologies that are available to us in the interest not just of our internal broadcasting media but of Great Britain plc. Massive export opportunities arise from the technologies at our disposal. We have a huge area of talent and expertise from which we can benefit.
  I hope that we have done something positive in providing a basic framework for the beginning of the digital technology that is now potentially available. I do not hold with the view that it will be a failure. There is a huge potential market to be exploited. I wish the Bill well when it becomes an Act because there has been a fair measure of agreement among hon. Members on both sides of the House on some underlying points, which will prove to be a useful framework for the developing industry to which I have referred.
  In conclusion—[Interruption.] This is wonderful. Having sat here silently all day, I am now being jeered by my colleagues—
  Mr. Hoon: Cheered.
  Mr. Miller: I prefer to hear that.
  I wish the Bill well, but I remind the House of those observations. I think that we will have to return to it much sooner than we would have thought. I urge the House, particularly the Procedure Committee, to think carefully about this and the other broadcasting measure.
  11.7 pm
  The Secretary of State for National Heritage (Mrs. Virginia Bottomley): The note on which the hon. Member for Ellesmere Port and Neston (Mr. Miller) concluded his remarks has, in many ways, characterized
  872
  the passage of the Bill through the House of Commons. I should like to add my strong thanks and appreciation to my hon. Friend the Minister of State, Department of National Heritage, my hon. Friend the Minister for Science and Technology and all the members of the Committee. I should also like to thank the extremely hard-working officials from the Department of National Heritage, who laboured long and hard and who frequently kept their heads when all about them lost theirs. We are extremely indebted to them. I should like to thank the Opposition, especially the hon. Member for Kirkcaldy (Dr. Moonie) and his team. The spirit of constructive debate has been extremely impressive.
  Despite the comments of the hon. Member for Ellesmere Port and Neston about how the Committee could have been handled better, it has been my impression that the regulators and the broadcasters have effectively been offering sessions to hon. Members of whatever persuasion to seek to consider options constructively and to provide information and advice to the best of their ability. In short, in many ways, it has been a model of careful scrutiny. Following the detailed debate and discussion in another place, I believe that it leaves our deliberations improved, modified and made more sensitive and appropriate to the evolving needs that have been described by many.
  I dispute the suggestion that the Bill is not appropriate to current circumstances. I believe that the comment made earlier today by the hon. Member for Sunderland, South (Mr. Mullin) that it is easy to become dazzled by technology was fair. We have to regulate and establish a framework for the world as it is, albeit while recognising the very fast pace of change. It was because of the digital future that it was so necessary to introduce the legislation now, enabling us to be on the front foot and to provide the United Kingdom with a platform to take a world lead in digital broadcasting.
  The Bill also gives media companies the freedom to expand into new sectors. It provides greater choice and it protects the interests of viewers and listeners. Hon. Members have already described some of the ways in which they believe that improvements have been made.
  The hon. Member for Kirkcaldy raised a specific point that I should like to address. We think that the regulatory gap that the Independent Television Commission perceives is, in practice, not a major concern. If a broadcaster acquired a small newspaper, it would become a newspaper proprietor and subject to the newspaper merger provisions if it then proceeded to make a major newspaper acquisition. The Monopolies and Mergers Commission, on reporting the matter to the Secretary of State, would no doubt take into account the fact that the newspaper proprietor held a broadcasting licence when that appeared to be a relevant factor. In other words, we believe that there is adequate regulatory protection.
  I suppose that I am pleased that the voice of the right hon. Member for Manchester, Gorton (Mr. Kaufman) is fairly isolated in being quite so critical of the Bill. The careful process of consultation on cross-media ownership and on digital television was followed by the Bill's launch in December, and that process was widely endorsed and commended by those in the industry and by other commentators for its detailed consideration and debate.
  Of course rapid change is occurring, and we must be prepared for the future, but the legislation represents a very substantial process of deregulation, offering media

  873
  companies a great opportunity to extend and to move into new markets. The divisions that emerged among Opposition Members earlier in the debate over the degree to which they were able to embrace the future were extremely marked and interesting.
  My hon. Friend the Member for North Thanet (Mr. Gale) has played a very active part in the Bill's passage, and I share his view of the positive opportunities for the future. Few would have predicted that satellite would have expanded as it has; I believe that the opportunities with digital television will be similar.
  The hon. Member for Doncaster, North (Mr. Hughes) asked a very important question about Doncaster. I shall never visit Doncaster again without worrying about being interviewed on radio, particularly if it is to see the developments of the Earth Centre, which is one of the millennium flagship projects there. I shall ensure that he receives a proper answer, and that there is further consideration of the matter that he raised.
  I am delighted about the tribute that my hon. Friend the Member for Salisbury (Mr. Key) paid to officials at the Department of National Heritage, where he is remembered with great affection. I cannot promise that digital will solve all the reception problems to which he alluded, but I think that it will offer greater opportunities—certainly to develop regional and local services, which is not possible on satellite.
  The hon. Member for Cambridge (Mrs. Campbell) made some important points and spoke a little about equal opportunities. Although it does not relate to the Bill, I shall send her a copy of what I told the Royal Television Society and skill set on that matter and on the need for people in television to act on the basis of enlightened self-interest, which, of course, means wise choices in staff. My remarks also dealt with the importance of investing in training and with the need for talented people. That point was made by my hon. Friend the Member for Ryedale (Mr. Greenway), who was a member of the 1990 Bill team. As he rightly said, the great success of Classic FM and Channel 4 since then is only a small indication of the opportunities that we now see for the future.
  I thank hon. Members. I believe that we have ensured that the Bill, which we have seen through its Commons stages, will have the overall support of the industry, of
  874
  regulators and of listeners. It safeguards and enhances the prospects for British business, British jobs and the British people. I commend it to the House.
  Question put and agreed to.
  Bill read the Third time, and passed.

  DELEGATED LEGISLATION
  Madam Deputy Speaker (Dame Janet Fookes): With permission, I shall put together the motions relating to delegated legislation.
  Motion made, and Question put forthwith, pursuant to Standing Order No. 101(6) (Standing Committees on Delegated Legislation),

  COMMUNITY SERVICE (SCOTLAND):
  That the draft Community Service by Offenders (Hours of Work) (Scotland) Order 1996, which was laid before this House on I I th June, be approved.

  LOCAL GOVERNMENT FINANCE
  That the Local Government Finance (England) Special Grant Report (No. 21) (House of Commons Paper No. 431), which was laid before this House on 7th June, be approved.—[Mr. Bates.]
  Question agreed to.

  EUROPEAN COMMUNITY DOCUMENTS
  Motion made, and Question put forthwith, pursuant to Standing Order No. 102(9) (European Standing Committees),

  SMALL AND MEDIUM SIZED ENTERPRISES
  That this House takes note of European Community Document Nos. 6141/96, relating to a third multi-annual programme for small and medium sized enterprises (SMEs), and 6929/96, relating to loan guarantees for investments by SMEs creating employment; recognises the important economic role that SMEs play throughout the European Union and supports the Government's intention to support the proposals for the multi-annual programme, subject to satisfactory agreement with the Commission and other Member States about the detailed contents of the programme and the level of the programme budget, and to examine further the proposals relating to loan guarantees for investment by SMEs creating employment.—[Mr. Bates.]
  Question agreed to.

  Legal Aid
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Bates.]
  11.15 pm
  Mr. John Marshall: I make no apology for raising in this Chamber, yet again, the question of legal aid—although I apologise to my hon. Friend the Minister for the hour at which I am doing so. However, he has the bonus that it gives him the opportunity to comment on the Government's White Paper "Striking the Balance" on the very day of its publication.
  As my hon. Friend knows, I have raised the subject of legal aid many times, both in Adjournment debates and in parliamentary questions. I have found that the concerns that I have raised have been echoed by many colleagues within the House, and by many people outside it. I obtained from the Library today a list of the questions asked on the subject of legal aid over the past 14 months. They number 250, which shows the concern of a large number of hon. Members about the position.
  I pay tribute to the interest of the press in the matter. Both the Daily Mail and The Sunday Times have shown great interest. Whenever I have spoken on the subject and been quoted in the press, there is always an influx of letters from people all over the country who are concerned about the way the system is administered.
  Paradoxically, while there has been a dramatic rise in the size of the legal aid bill—it was under £100 million in 1979, about £200 million in 1983–84, had grown to £1.2 billion 10 years later and is now about £1.4 billion—eligibility has been restricted. As my hon. Friend said only yesterday, the proportion of the population eligible for legal aid has fallen from 70 per cent. to 49 per cent.
  Ironically, as my noble Friend the Lord Chancellor said, at a time of record expenditure on legal aid, the esteem and reputation of the Legal Aid Board are probably at an all-time low. There has been widespread concern that the taxpayer is not getting value for money, and that some of the cases supported by the legal aid fund are a disgrace.
  A case referred to in parliamentary questions involved a prisoner who had absconded from prison, but was still being supported by the legal aid fund. The board might at least have said, "If you come back to prison, we will carry on funding you."
  Only yesterday, we read about the disgraceful case of an individual suing the national health service because he has not died on time. It is a new concept of medical negligence—"You told me I would live for six months, but I have lived for three years. I am going to sue you, and it will be funded by the legal aid fund." The thought of taxpayers' money being used to sue the national health service for keeping someone alive beggars belief. I am glad to hear that my hon. Friend has called in the chief executive of the Legal Aid Board to discuss the matter.
  Our constituents feel that the Legal Aid Board has not been a good judge of the quality of cases. The basic principle of legal aid—that no one should be denied access to justice—has been subverted in civil legal aid cases, because the legally aided litigant can blackmail his opponent. Such litigants know that, win or lose, they will not be out of pocket, but their opponents know that, win or lose, they will.
  876
  In the north-west, people have sued chief constables for wrongful prosecutions. The insurers told the defendants that it was cheaper to settle than to continue the cases. Defendants have to calculate how much to offer, because the legal aid certificate might be withdrawn at that stage. They have to try to work out an absurd equation: will it be cheaper to fight or settle a case which logically they know that they can win but in respect of which they could lose financially?
  In my constituency, there was the case of a partnership that had broken down. One partner sued the other. The party that was being sued was told by his lawyer that he had a wonderful case and would win. He fought it and won, but he was substantially out of pocket because of the legal costs. While the Legal Aid Board is sometimes asked to contribute toward the cost of a successful defendant, the number of cases in which that happens is negligible. A written answer on 16 October 1995 stated that, in 1994–95, help had been given in 158 cases; in 1993–94, the figure was 186.
  There is a feeling that the wrong people have sometimes obtained legal aid. It is a scandal that some very well-heeled individuals have managed to get it. One thinks of Mr. Ernest Saunders, the man who made the miraculous recovery from Alzheimer's disease—"Guinness is good for you, it cures Alzheimer's". He was reconciled with his wife and her assets once he no longer needed legal aid.
  There was Mr. Gordon Foxley, who short-changed the taxpayer when he was employed at the Ministry of Defence, and did so again when he applied for legal aid, despite owning houses and cars and seeming to have substantial assets. Those people's legal bills, which were often substantial, were paid by taxpayers who live in much less salubrious homes. Why should the not-so-well-off be asked to pay the legal bills of people with luxurious life styles?
  The generosity of the legal aid scheme knows precious few limits. The most absurd case was that of the German inventor, who lived in Germany but sued Sony in the British courts. He will never pay one deutschmark of tax to Britain, but he received £500,000 in legal aid. That is a disgrace. I was sorry to read in the White Paper that the Government are going to consult on whether overseas residents who bring legal actions in the British courts should get legal aid. The Minister can consult me at any time of the day or night, and my answer will be no. Those who are not British taxpayers, owe no allegiance to the Crown or have no residence in this country should not qualify for legal aid.
  It is also felt that there has been some fraud that the Legal Aid Board has not been good at detecting. On 2 February, a written answer in column 260 of the Official Report gave the number of representations about fraudulent applications for civil legal aid. In 1991–92, there were only 2,775; by 1995–96, it was estimated that there would be 15,000. There have been many representations but very few prosecutions.
  In a written answer of 18 July 1995, at column 1013, the then Parliamentary Secretary said that the number of applicants investigated for false declaration of means in 1987–88 was nil; in 1988–89, nil; in 1989–90, nil; and in 1990–91, six. The figure reached 15 in 1993–94, and 25 in 1994–95. The reply then said that the number of assisted persons prosecuted under section 39 of the Legal

  877
  Aid Act 1988 over the same period was nil until 1991–92, when we had a dynamic year and two were prosecuted. The figure returned to nil the next year, and, in 1993–94 and 1994–95, the Crown Prosecution Service went into overdrive and managed to prosecute two people in each year.
  More recently, on 22 May this year, a parliamentary answer on fraud said that, in 1995–96, 29 cases were referred to the police in respect of civil legal aid, and, in respect of criminal legal aid, five assisted persons had been referred to the police. The number of applications for criminal legal aid runs into hundreds of thousands, and we are asked to believe that those chaps who are accused of crimes suddenly become terribly honest when they fill out the legal aid form. I just do not believe it.
  Let us look at the cost of some of those cases. We were told on 26 February that, to date, the Maxwell case had cost the taxpayer £8.3 million. We can console ourselves with the thought that that includes an element of VAT, but it is still a large sum, which causes concern to taxpayers.
  I congratulate my hon. Friend the Member for Corby (Mr. Powell), who asked on 1 May how much money had been paid to certain firms. In 1993–94. Robinsons topped the list of legal aid millionaires, because it received £3.2 million. It did not do quite as well the following year, when the figure was topped by Leigh Day and Company, which received £8.3 million from the legal aid fund. Those figures cause concern to taxpayers.
  Another worry about the legal aid fund is part of a wider concern: that the costs and delays involved in legal action mean that the very rich can afford legal action; the very poor can afford it through legal aid; but middle England, middle Scotland and middle Wales find it very much more difficult. That is why I welcome the imminent report by Lord Woolf, which will speed up justice and thereby make it cheaper. That will help everyone—the legal aid fund and the rest of us who may from time to time have to litigate.
  Today's publication of the White Paper is a fortuitous coincidence, and it enables me to comment briefly on it. I welcome the fact that the Government withdrew legal aid from the apparently wealthy, because nothing did more to bring the legal aid fund into contempt than the sight of very wealthy individuals living in large, luxurious homes, with a nice life style, being funded by people on much more modest means. There is no doubt that the legal aid fund gives the impression of being a juggernaut out of control, and the Legal Aid Board gives the impression of having a strange order of priorities. That is why I welcome some of the comments in the White Paper.
  I welcome the fact that the White Paper is the first document for a long time that has emphasised the need to get value for money and financial control in the legal aid system. I also welcome the fact that the Lord Chancellor has said that he will lay down priorities within civil and family legal aid, and that, as one would expect from him, his main priorities will be the protection of children and the detention of mental patients.
  I welcome the fact that there will be criteria for deciding whether cases should be supported. One criterion is the chance of winning the case. My God, that should have been a criterion from the start. The importance of the case, and the likely cost compared to the likely benefit—those should have been criteria from the start.
  878
  I welcome the statement in paragraph 2.21:
  "Once a case is in progress, the provider will be able to withdraw legal aid if the circumstances … such as the chance of winning change so that it is no longer worth pursuing."
  I am sure that that will be welcomed throughout the country.
  I welcome the fact that, in civil legal aid, everyone will be expected to make a minimum contribution toward the cost of the case. That may deter some, but I still think that there is an unequal balance between the legally aided litigant and the person who must fight a case against him. It is true that, in the White Paper, the Government propose that, if the successful party suffers financial hardship, he will get some help, which he has not received until now, but I suspect that he will still suffer for winning, and that is not right.
  I welcome the fact that other agencies besides barristers and solicitors are to benefit from the proposals, because one of the big growth areas of civil legal aid has been matrimonial legal aid, which grew from £87.5 million in 1989–90 to £266 million in 1993–94.
  I especially welcome the publication of the White Paper, and the determination that the Lord Chancellor and the Parliamentary Secretary have shown in carrying out this desire to get value for money, to bring common sense back into the operation of the legal aid system.
  As the White Paper says,
  "We need to restore confidence that the scheme is fair and excludes weak or trivial cases."
  If my right hon. and hon. Friends can do that, they will be doing a service to justice throughout this country.
  11.31 pm
  The Parliamentary Secretary, Lord Chancellor's Department (Mr. Gary Streeter): I congratulate my hon. Friend the Member for Hendon, South (Mr. Marshall) on his success in securing this Adjournment debate, and on the timing of the debate, which coincides, as he said, with the launch of our White Paper today on legal aid reform. I am grateful to him for his customary robustness and forthright views on the administration of legal aid; I sympathise with much of what he has said.
  I am as outraged as my hon. Friend when I see apparently fruitless cases being pursued with the benefit of legal aid. I am certainly not here tonight to defend the indefensible. The current state of the legal aid scheme and its administration leave much to be desired. That is why we have today published a White Paper containing a programme of radical action designed to transform the legal aid scheme into one that can command public confidence. The Government are determined to stop abuses of legal aid such as those that my hon. Friend mentioned.
  I warmly pay tribute to my hon. Friend for his perseverance over the years in raising these abuses in the House. This has played a major part in bringing the Government to the stage of reforming the legal aid system. I am grateful to him for his warm welcome of the White Paper.
  Before explaining the proposals that the Lord Chancellor has made in his White Paper, it is important to spend a moment reflecting that there is another side to the legal aid story. Reasonable access to the law is

  879
  fundamental to the health of our country. Legal aid is intended to, and does in thousands of cases, provide those in genuine need with the help they need with their legal problems. No one should be denied access to justice because he has nothing in the bank.
  In 1995–96, the Legal Aid Board paid for 3.33 million acts of assistance. In only 5.2 per cent. of civil cases was judgment awarded against the assisted person. Since 1989, when the board assumed responsibility for the administration of most legal aid, the percentage of refusals of civil applications on legal grounds has increased from 11.3 per cent. to 22.7 per cent., demonstrating an improved commitment to the rigorous examination of applications. I nevertheless fully accept that there is much more to be done.
  We will not rest until we are satisfied that the Legal Aid Board is capable of weeding out all undeserving applications for legal aid. My hon. Friend's list makes it clear that we have some way to go.
  To illustrate what I have in mind, I shall outline some of my thoughts on what a legal aid scheme should and should not be about. The first principle that should be applied in every case in which an application for civil legal aid is made must be that public funds should not be used where a private client would not pursue the case with his own money. The legal aid system does not exist to support any and every piece of litigation that might crop up; nor is it designed to give financial backing to the whims of political correctness. We must have in place mechanisms to ensure that help is properly targeted.
  It cannot be right that those granted civil legal aid are put in a position to blackmail their opponents by virtue of their superior financial support. I have spoken recently about opponents facing "state-funded rottweilers" when they are involved in proceedings against legally aided opponents. Legal aid was designed to stop the rich riding roughshod over the rights of the poor. However, all too often, legal aid is now used as a weapon of blackmail—my hon. Friend gave examples of that.
  People with only modest resources find themselves unable to afford to defend their legitimate rights against those supported by the bottomless purse of the legal aid fund. The balance is wrong, which is why "Striking the Balance" is the title of the White Paper. All litigants, whether they be legally aided or not, should have a financial stake in the proceedings—an assisted person must have a real interest in his case. The Government cannot allow themselves to be a party to any form of blackmail caused by the legal aid system.
  Legal aid must go only to those whose means are such that they are deserving of help. We have established strict financial eligibility limits to ensure that help is targeted properly. Despite this, it would appear that there are still those who seek to get around these rules in an attempt to get legal aid where they should not. On this front, we have already taken positive action.
  Hon. Members will be aware of the changes that the Lord Chancellor has announced to deal with apparently wealthy legal aid applicants. On 28 February 1996, he announced new regulations to strengthen the arrangements for means-testing apparently wealthy applicants for legal aid. The first will allow the assets of friends and relatives of the applicant to be included in the financial assessment. The second will introduce into legal aid assessment a limit of £100,000 on the equity allowable
  880
  in the applicant's home, the amount of repayable mortgage that can be allowed, and the amount of mortgage that can be offset against equity.
  The Lord Chancellor also announced that he had asked the Legal Aid Board to set up a special investigations unit as soon as possible. The unit will build on a prototype already in existence in the Legal Aid Assessment Office, and it will investigate the means of applicants whose financial circumstances are particularly complex. That will strike at the heart of the issues raised by my hon. Friend. Initially, the unit will deal only with applications for civil legal aid, but it will be extended as soon as possible to cover both civil and criminal legal aid. I am sure that my hon. Friend would welcome that.
  We have already made these changes, and the White Paper that was launched today goes further. I believe that three main public perceptions must be addressed: first, the public see legal aid as wasteful in supporting too many weak and undeserving cases; secondly, the public see legal aid as over-priced, with taxpayers paying for what appear to be huge lawyers' fees; and, finally, the public see legal aid as unfair to the opponents of legally aided people, who too often feel that they have to give in on cases that they would have a good chance of winning.
  We need a legal aid scheme that gets more of the right services to the right people. At present, we have a scheme which—despite efforts to control lawyers' pay and the tightening of the eligibility rules—is delivering less and less to fewer and fewer. Expenditure has doubled in the last few years, yet the percentage of households that qualify for help has fallen from about 70 per cent. in the early 1980s to about 50 per cent. now. In that light, reform is inescapable.
  We have four fundamental proposals to tackle the problems that we have now identified in civil legal a:id. First, in future we will buy a wider range of services under bulk contracts at fixed prices. In that way, we will be able to decide what services should be available and be able to meet local needs within nationally set priorities: we will he able to get the right services to the right people.
  The second proposal is to open up legal aid to new services, such as advice agencies, and to promote competition in the contracting process. I welcome my hon. Friend's kind remarks about that suggestion. Contracts will have in-built incentives to promote efficiency and quality, and in that way we will be able to get more and better services for our money.
  Thirdly, we will introduce a new test of whether a case deserves to share in the money available. That test will be stronger than the current merits test, which is concerned primarily with the legal merits. We will open the test out to include criteria that ensure that only those who are most in need receive help. An individual's nationality and place of residence may be relevant.
  I want to make sure that any test that is operated under the new scheme has no difficulty in weeding out applications from people whose cases are being heard in this country only in order to take advantage of the generosity of our legal aid scheme. My hon. Friend will be reassured to hear that. In addition, by requiring assisted persons to pay more often towards the cost of a case, we can expect them and their legal advisers to be careful not to bring ill-founded cases.
  Finally, we will redress the balance between assisted persons and their opponents by ensuring that, when legal aid is used to back losing claims, unaided opponents will

  881
  have better rights to get some or all of their costs back from the assisted person or the Legal Aid Board. As a result, the state will be even-handed in its treatment of both parties. We see no reason why the taxpayer should be expected to fund litigants who are not willing to make a sacrifice themselves. It is in no one's interest to encourage people to bring weak and undeserving cases before the courts, especially when the taxpayer must foot the bill.
  That is only part of the picture. We look forward in the near future to the publication of the Woolf proposals, which I hope will usher in a new regime of cheaper and
  882
  simpler access to justice. That would be a significant step in the right direction. I trust that I can rely on my hon. Friend's support in implementing those legal aid reforms. He has played a vital role in bringing them about.
  I truly believe that the reforms can achieve a fairer, more efficient and better controlled legal aid scheme. I fully expect that the horror stories that we have heard tonight will become things of the past. The changes outlined in the White Paper are indeed radical but, as my hon. Friend has helped us to understand tonight, nothing less will do.
  Question put and agreed to.
  Adjourned accordingly at nineteen minutes to Twelve midnight.