HC Deb 06 March 2002 vol 381 cc346-72
Mr. Tim Yeo (South Suffolk)

I beg to move amendment No. 6, in page 3, line 2, at end insert— 'and (c) any proposal by the Secretary of State to bring within the remit of OFCOM the BBC Board of Governors.'.

Mr. Deputy Speaker

With this it will be convenient to discuss the following amendments: No. 7, in clause 6, page 5, line 28, at end insert— '(aba) the BBC Board of Governors.'. No. 8, in schedule, page 7, line 22, at end insert— '(aba) a member of the BBC Board of Governors'.

Mr. Yeo

The amendments in this group, especially amendment No. 7, go to the heart of the only surviving political controversy in the Bill. Why are the Government persisting in excluding the BBC from the remit of Ofcom? The structure that Ministers have proposed for Ofcom is anomalous, irrational and likely to work against the interests of viewers, listeners, licence fee payers, other broadcasters and the BBC itself.

It is absurd for Parliament to approve the creation of a new super-regulator for the industry and, at that very moment, leave outside its responsibilities the largest single broadcasting organisation in the country. The BBC has more than half the national radio audience and a substantial share of the total television audience—although the latter is gradually reducing. The chance of primary legislation does not come along very often. After the communications Bill in the next Session, it may be a decade or even longer before another opportunity occurs.

To those who say that we should not prejudge the forthcoming debate about the renewal of the BBC charter, I say that that debate should start with a recognition that the BBC is increasingly one of a number of broadcasters, albeit a large, special and important one. Its role will he less dominant in future. The BBC's public service obligations are much more stringent than those of other broadcasters and its governors have a primary duty to see that those public service obligations are met. However, so do the boards of Channel 4 and the ITV companies. If the ultimate responsibility lies with Ofcom for all those other broadcasters, so it should for the BBC, especially as it continues to enjoy such a uniquely privileged funding status.

The Government will eventually have to concede this argument and I urge them to do so today. If they do not, the only remaining chance will be in the communications Bill in the next Session. That Bill is due to be published in draft form soon—perhaps the Minister can enlighten us on when we can expect to see it. We could have the absurd situation of the Government publishing a draft Bill that contains an amendment to this Bill, perhaps even before it receives Royal Assent.

The amendment is designed to save Ministers from that embarrassment—I am ever helpful. I also give the Minister notice that we will seek to press amendment No. 7 to a vote and I hope that we will enjoy the support of all those hon. Members who have expressed support for the principle in the amendment.

Mr. Bryant

My problem with the amendment is that it seems to suggest that the issue of the BBC's regulation and how it relates to Ofcom is simply a matter of wholly in or wholly out. The hon. Gentleman was not able to join us in Committee, so he will not have heard all our debates—perhaps he has read all eight of them—but the point was often made that the BBC is already regulated by third parties and therefore will, in large measure, be regulated by Ofcom. The problem with the amendment is that it might make it impossible for the governors and the BBC to have any accountability directly to this House.

Mr. Yeo

I assure the hon. Member that nothing I propose will affect his rights, should he be a member of the BBC's pension fund from his time there. I did read the reports of most of the Committee's debates with interest and I was pleased to see that the issues were addressed. I seek to put the BBC on a par with the other broadcasting organisations that will ultimately be regulated by Ofcom. That will still leave the governors with a substantial and important role, to which I shall refer in more detail presently.

The idea that the amendment, by placing the BBC within Ofcom's remit on the same basis as other organisations, would put the governors out of a job is wrong. As to the question of how accountable the BBC is to this House, that is a matter on which hon. Members will have a variety of views. However, many of us have felt over the years that the existing system falls short of being satisfactory.

Mr. Gerald Kaufman (Manchester, Gorton)

The whole point about the BBC being established under a charter is that it is not accountable to the House of Commons. If it operated under an Act of Parliament, it would be accountable in the same way that Channel 4 is accountable to this House. I well recall that when the Select Committee asked the chairman of the BBC to delay a planned change until the Committee had reported on the matter, he said that that would be yielding to political interference with the BBC. It was a simple request for a delay. As I shall seek to say if I am fortunate enough to catch your eye, Mr. Deputy Speaker, the real problem with the BBC is that it is accountable to no one.

Mr. Yeo

The right hon. Gentleman speaks with great authority and expertise on this subject and I know that he has studied it carefully for a long time. I entirely accept everything he says, particularly the point about the charter and the obstacle that it represents to direct scrutiny by the House. He cited an example in which a wholly reasonable request was denied. Now is the time to address that difficulty.

7 pm

Mr. Derek Wyatt (Sittingbourne and Sheppey)

The hon. Gentleman may care to know that I once asked the Table Office whether I could table an amendment about the BBC. The Speaker, who is now in another place, wrote to the Secretary of State. The Secretary of State could not make up his mind so he wrote to the chairman of governors, who wrote to the Speaker to say that it was up to her. Clearly, Parliament has no way of holding the BBC to account.

The question of whether the governors want to be included in Ofcom arises because the board of Ofcom might define, once and for all, what a public service is, then ask the governors to behave by holding the BBC to that remit. Does the hon. Gentleman agree that that is what they fear and why they do not want to be included?

Mr. Yeo

That is another example of the difficulties faced by hon. Members in trying to call the BBC to account.

I do not know the motives of the governors who are apparently resisting the inclusion in Ofcom. Certainly, if Ofcom can produce a definition of public service broadcasting that commands broad agreement, it will have achieved something that has eluded many people over many years. The need to make that definition is growing increasingly urgent, for several reasons.

My motive in moving the amendment—apart from a general sense of fairness to the other players in the broadcasting industry—is to benefit the BBC. I have no wish to damage the BBC's governors, staff, management or programme makers; and certainly not its viewers, listeners or licence fee payers. The BBC would be strengthened if it were to be so regulated in future. The present situation may have been justified a long time ago, but no longer: it is now anomalous.

The right hon. Member for Islington, South and Finsbury (Mr. Smith) has come round to that viewpoint. He spoke impressively on Second Reading, explaining his conversion by saying that his concern for the future of public service broadcasting had led him to share our view that the BBC should have the same relationship with Ofcom as other broadcasters.

Mr. Ian Taylor

The issue goes even wider than that. The BBC's problem is that it operates in an increasingly multi-channel digital age with different delivery platforms. It may therefore decide that it wishes to reinforce its position not only by using the internet, cable, satellite, and other delivery mechanisms, but by taking an interest in the production of programmes that compete with the commercial sector. If the BBC is to be able to make effective investment plans, it needs to be part of an organisation that has an overview of all those matters—that is, Ofcom.

Mr. Yeo

My hon. Friend speaks on these matters with great expertise and authority. I entirely agree that we are moving into a world that is wholly different from that of even a decade ago. Many of the opportunities presented to the BBC and other broadcasters were not conceived of at that time. Our comments are not intended as a criticism of people who in the past did not require such a regulatory arrangement. Today, the Government have an opportunity to acknowledge the extent of the changes that have occurred by accepting what has become a widespread view.

Brian White

Having watched the launch of BBC4 the other night, I agree with the sentiments behind the hon. Gentleman's proposal. However, does he appreciate the danger that, if the amendment were to be accepted, the establishment and initial months of Ofcom would be dominated by discussions about the BBC? The most important matters with which Ofcom will deal relate to communications, but they would be lost in a controversial political debate about the BBC.

Mr. Yeo

The best way to ensure that the debate about the establishment of Ofcom is not dominated by arguments about the BBC would be to accept the amendment. That would largely put the matter to rest.

Mr. Bryant

The hon. Member for Esher and Walton (Mr. Taylor) seemed to suggest—and the hon. Gentleman seemed to agree—that Ofcom should decide on the future investment pattern of the BBC. That would be a dangerous route to take.

Mr. Yeo

I am sure that that is not what my hon. Friend was suggesting, and it is certainly not what I was agreeing with. He was suggesting that the investment decisions that are made by the BBC and bodies regulated by Ofcom will he affected by a whole range of completely new factors and that it would be all the more anomalous if the BBC alone, among the bodies making those decisions, was not subject to a regulatory regime that could take account of all the new considerations.

I want to refer briefly to the views of the right hon. Member for Manchester, Gorton (Mr. Kaufman), although I know that he will speak later. His opinions on the subject, and those of members of the Select Committee on Culture, Media and Sport, which he chairs, have been consistent for some time. This is not an issue that has just loomed over the horizon.

Throughout the passage of the Bill, and in the debates that preceded it, Ministers and others who tried to defend their insistence on a special exemption for the BBC, have increasingly struggled to make a coherent case. Recently, even since the conclusion of proceedings in Standing Committee, the BBC has contributed to the discussions with the publication of the document, "BBC Governance in the Ofcom Age". I welcome that document, which is quite revealing in more ways than one. It frankly acknowledges some of the shortcomings inherent in the present situation. That is a useful step forward, although it begs the question why some of the issues were not dealt with before. [Interruption.] The hon. Member for Rhondda (Mr. Bryant) says from a sedentary position that we did not change the law when we were in power. As I said, we are in a rapidly-changing environment. Even in the five years since Labour took office, the background to the whole media industry has changed fundamentally.

I am not criticising people who have not taken such decisions before. I am saying that, in the light of our present knowledge, and given that after the passage of the communications Bill next Session we may not have another chance to legislate on these issues for many years, we must ensure that we react to the situation as it is today. Trying to make cheap points about what the Conservatives did or did not do is completely out of keeping with the spirit of this debate.

Mr. Ian Taylor

As the Minister responsible for science and technology in the previous Conservative Government, I can assure my hon. Friend and the hon. Member for Rhondda that at that time the BBC was put on notice that in the multi-channel digital environment that was already becoming inevitable, the definition of public service and the role of the BBC would need to change, perhaps well before the next review of the BBC's charter. The situation has arisen not as a result of failures by the previous Conservative Government, but because of the rate of progress since 1996 in the whole broadcast and internet technology sector.

Mr. Yeo

I am grateful to my hon. Friend for that information. In a spirit of consensus with the hon. Member for Rhondda, I should say that I am usually the last person to defend the record of the previous Conservative Government.

Mr. Kaufman

Not quite the last.

Mr. Yeo

if the right hon. Gentleman is offering to take over that role, I am sure that my Front-Bench colleagues will be glad of his assistance.

Page 3 of the recently published BBC document reveals that a unit is to be established to ensure that the Government are furnished with performance information, gain a proper understanding of audience behaviour and needs, and can access relevant expertise". That is interesting. If the BBC has lacked those things for all these years, one wonders how it has managed to do its job.

The document also sets out why the BBC believes that oversight by Ofcom, in the manner of all other broadcasting organisations, would be wrong. I am afraid that some of the arguments advanced are very unconvincing. It is claimed on page 6: Taking back-stop powers over the public service remit of the BBC would make Ofcom's effective early operation much more difficult. Because something is difficult does not mean that it is wrong. The remainder of Ofcom's very considerable tasks will scarcely be a doddle. I do not see how it should not be able to accept the difficulty—if, indeed, it is one—of dealing with the BBC at the same time. It would be much easier to deal with it from the outset than to have it imposed at a later date, spatchcocked in when Ofcom already has operating procedures in place.

Equally odd is the argument advanced in favour of continued internal BBC regulation. The document states: Unlike an external regulator, the Governors can take direct action if they believe that the BBC is not serving the public interest. They can change the management, and they can alter the BBC's budget allocation. In other words, they can ensure that the BBC must adhere to their judgement of what is in the public interest" Nothing proposed in the amendment would prevent the governors from doing that in future. In my view, they would and should continue to have exactly those powers and to exercise them on a regular basis. Sadly, the reforms proposed in the document do not add up to a great deal. The first of the four aims of the reform plan, as it is described, is said to be To ensure that the distinction between the Governors' role and the management's is clearly understood inside and outside the organisation. That is a worthy enough aim, which, after more than 70 years, it might have been hoped would have been addressed already. However, it is certainly not an aim that reduces in any way the case for bringing the BBC fully under Ofcom; nor, indeed, do the other three aims of the so-called reform plan.

The document sets much store on the improved support that the governors will receive in future, enabling them to discharge their duties in what they describe as "the Ofcom age". This restructuring may or may not help the governors; that is not for me to judge. However, it does not answer this question; why should not the BBC now be regulated on the same basis as the rest of the industry?

I will not stray from the subject matter of the amendment, but before leaving the document—which I commend to hon. Members as a worthwhile study, and something that will be useful when we discuss the future of the BBC in the context of the debate about charter renewal in the future—I should point out that it refers to the licence fee payers as shareholders. I was interested to pick up on that. I had not noticed that before in a BBC publication, although I have not studied them for as many years as some of my colleagues. I do not know whether that is a pointer to a secret agenda existing somewhere within Broadcasting House.

On page 2, the chairman's foreword claims: But nor do we have any desire simply to replicate services which could be provided equally well by the private sector. I wonder whether he cleared that with the director general before he included it in his foreword. Certainly that is something else that I look forward to returning to when we scrutinise some of the new proposals and the existing activities of the BBC.

I happened to be in the shadow Cabinet meeting when the right hon. Member for Manchester, Gorton (Mr. Kaufman) raised a point of order at the start of our proceedings, but I agree with what I believe to be the thrust of his point. I was surprised today to receive a letter from a BBC employee, saying that this House has spent too much time considering this issue and that Parliament should now debate the subject in a more constructive way. The person concerned is fully entitled to his view, but whether it is for the BBC to use licence fee payers' money to employ a member of its staff to act as a lobbyist who then writes to Members of Parliament to say that we are spending too much time debating a particular issue—suggesting that it has been discussed in a way that is not constructive—seems highly questionable.

The BBC is a powerful organisation with a distinguished history. I hope that it has a successful future. In a multi-channel world and an increasingly global industry, its role in the future will be very different from in the past. When it started as a small organisation operating a monopoly radio station—a pioneering organisation—the role of the governors was totally different from what it is today.

Today, the BBC enjoys immense privileges. It is funded, uniquely in our national life, by a more than inflation-proofed, guaranteed compulsory levy on consumers; a levy that is highly regressive in its impact on households and which leaves consumers with no alternative but to pay. Against this background, to leave the BBC as a self-regulating organisation in an industry where no other organisation enjoys that status is wrong.

The time for the BBC governors to be judge and jury in their own affairs has ended. Those governors will still have an important function in the future, but it will be a different one. It is clear to me that most of the media world believes that the BBC should be fully within Ofcom's remit. It is clear that many hon. Members on both sides of the House believe that as well—it is clear, I suspect, even to many within the BBC. Eventually—sooner rather than later, I hope—it will be clear to Ministers. They can save themselves and Parliament a great deal of time if they accept the amendment, which I commend to the House.

7.15 pm
Mr. Kaufman

May I make it clear that, in the remarks that I offer to the House, I am expressing my personal view and not speaking on behalf of the Select Committee on Culture, Media and Sport? The Committee is considering these matters at the present time. Later in this Parliament, it will no doubt consider what will happen with the BBC when its charter ends in June 2006.

I also make it clear that while I have a great deal of sympathy with the argument of the hon. Member for South Suffolk (Mr. Yeo), I cannot sympathise with the terms of his amendment, which would entrench the role of the BBC board of governors. I am on record as opposing the existence of the BBC board of governors, for reasons that I shall advance as I proceed.

The hon. Gentleman deserves great credit for having studied with care the document that the BBC has issued and which Mr. Davies has sent to a number of us. The hon. Gentleman spotted a reference to all of us who pay the licence fee as "shareholders". If we were shareholders, there would be a company meeting. If there were a company meeting, we would have the right to state our views and, what is more, the chairman and the governors would have to respond to them.

In my experience, both as an individual and as Chairman of the Select Committee, the BBC is not interested in the views of the public or of Members of Parliament. I intervened on the hon. Member for South Suffolk to refer to one episode, when the Committee was considering the BBC proposal—not yet then implemented—to remove "Yesterday in Parliament" from FM, which was a violation of the spirit, if not the letter, of the charter. The chairman of the BBC, Sir Christopher Bland, said that for him to yield to the request that the BBC delay removal would be political interference in the BBC. It did so happen that the BBC later—not much later—decided, because the audience had fallen so much, to transfer the programme back again. We were right all along, and if the chairman had listened to us, he would not have made that mistake.

I have previously raised, from the very spot where I stand now, the deplorable BBC programme "The Big Ticket". I have always argued that the BBC is behaving anomalously in paying Camelot for the rights to broadcast lottery results rather than being paid, as Radio Telefis Eireann is paid. When the BBC decided to stage that programme, I pointed out firmly that that clearly violated the charter in that the BBC was promoting commercial activity by a privately owned company. I was ignored. I received correspondence demonstrating that the BBC seriously regretted the line that I had taken. Then, the BBC board of governors accepted that it was wrong to broadcast that programme and abandoned it.

For that reason, among others, I agree with the argument of the hon. Member for South Suffolk but do not agree with his remedy. The BBC board of governors was sufficiently supine not to interfere in either of those matters. The reason for that is that the board is not a professional group of people who have knowledge of communications. The people on the board are picked at random. They were picked at random by the hon. Gentleman's party when it was in office, and I cannot say that my party has done a great deal better.

There is a great deal of tokenism in appointments to the board of governors. I am sure that all the people who sit on it are extraordinarily worthy individuals, but I cannot understand why, for example, the chief executive of Lambeth borough council was regarded as a person who should participate in the running of the biggest broadcaster in the United Kingdom and one of the most important broadcasting organisations in the world.

During the past two weeks, there have been two blatant violations of the watershed. First, there was the breakfast programme in which Ali G participated, regaling a 9 am audience with a stream of filth and obscenity. The BBC apologised, but so far as I know not a single member of the BBC board of governors has taken any view on that matter—certainly not publicly. Next, Stephen Fry compered the British Academy of Film and Television Arts awards the other Sunday. The broadcast started before the watershed, and again we had a stream of inexcusable obscenity. It went over the watershed, but began before it. We have heard not a peep out of the BBC board of governors on either episode, or on a range of other matters.

I do not believe in censorship. Before and since coming to the House, I have campaigned against it. I am against theatrical censorship. I am against censorship of the cinema. I am against censorship of broadcasting, except in the sense that I believe that the protection of children is a duty of adults until those children are old enough and mature enough to think for themselves. The only activities in which I have ever participated in regard to censorship, including when the House dealt with film when the right hon. and learned Member for Folkestone and Hythe (Mr. Howard) was Home Secretary, have related to children.

If the BBC board of governors cannot even perform a role in protecting children, what on earth is it for? It does not—heaven help us—run the BBC, because that is run by a partnership of the chairman and the director general. It cannot even exercise that role to make the BBC accountable for what it is supposed to be doing.

Michael Fabricant

It is clear that some of the right hon. Gentleman's views must be shared by the chairman of the BBC, who, if I may put words in his mouth, recognises that the board of governors may, on occasion, have been supine. Nevertheless, Gavyn Davies has introduced the document "BBC Governance in the Ofcom Age", in which he seeks to persuade us that the board of governors will become proactive in governing the BBC and its board of management. Does the right hon. Gentleman believe that that will be achieved?

Mr. Kaufman

I am sure that Mr. Davies means well and understands that there is a problem. I am sure that he is doing his best to address himself to that problem in an effort to save the way in which the BBC is governed at present. I am afraid that those efforts will not work. He was good enough to send me a copy of the document, but what we have is a series of regulatory rules for the BBC board of governors, laid down on its behalf by the chairman. The regulation is not external in any way. It is internal—so much as, and no more than, the BBC itself feels it needs.

James Purnell (Stalybridge and Hyde)

My right hon. Friend's argument is interesting, but there is a common misconception that the BBC falls totally outside the scope of Ofcom. He will correct me if I am wrong, but my understanding is that the BBC would be subject to the rule of the Broadcasting Standards Commission on issues of obscenity. A complaint could be made to the BSC or to Ofcom. Ofcom would have no powers in relation to ITV or Channel 4 that it did not also have over the BBC.

Mr. Kaufman

My hon. Friend is highly knowledgeable about these matters, but I do not need to be reminded of what the White Paper said or of what the proposals are.

The situation is simple. If, under the Independent Television Commission—soon to be absorbed into Ofcom, which will subsume its powers—there is a violation of, say, the statute governing Channel 4 or of the watershed, the ITC can take action against the broadcaster. When "Brookside" dealt, well before the watershed, with incest, the ITC intervened. When, under Mr. Dyke, ITV wanted to shift "News at Ten" to allow it free evenings to broadcast more adult material, the ITC stopped it. When ITV tried again and succeeded, the ITC, having caved in, came back and forced the programme back into place.

Not only the terrestrial channels, but all commercial channels are under the ITC, and will come under Ofcom. In the case of a broadcast on MTV to which the ITC took exception, the ITC imposed a heavy fine on MTV for violating the watershed. There is no external sanction of any kind on the BBC, and under the Bill there will be no external sanction of any kind Last week, representatives of the Broadcasting Standards Commission came before our Select Committee and told us that they were looking into the Stephen Fry episode, but all that they can do is to administer a slap on the wrist.

7.30 pm

I shall tell my hon. Friend one reason why the present regime is entirely unacceptable. I am not in favour of fines and castigations, but if there is a regime of regulation that is enforceable, it makes those who are responsible for the programmes—with whose freedom I do not wish to interfere—aware that there is a sanction, which causes them to be slightly more wary. Let us face it: people broadcasting on the BBC do not give a damn when they violate the watershed. Nothing happens to them. There is no external regulator to say that something should have happened to them, so they will go on violating the watershed with impunity and the BBC spokesperson will say that the BBC received, say, only six complaints.

If there is an external regulator, even if that regulator is not heavy-handed, there is an awareness within the organisation that external regulation exists. There is no such awareness at the BBC, because all my experience in all the time that I have been in the House is that the BBC board of governors lies flat and allows itself to be walked over by whichever director general is in power at the time.

I cannot support the amendments tabled by the hon. Member for South Suffolk, not because I do not believe that the BBC should come within the scope of Ofcom?which I do—but because all his amendments are about the BBC board of governors, and I regard it as anomalous and antiquated that in 2002, in a multi-channel environment, with convergence a factor, with huge competition, and when the BBC can spend £20 million on a channel watched by 11,000 people, the BBC's governance should be based on the duopoly of the chairman and the director general, with a supine, inexpert board of governors. It is utterly against the interests of the BBC.

Mr. Bryant

Will my right hon. Friend give way?

Mr. Kaufman

I will give way in a moment.

By contrast, all the other broadcasting organisations are run—efficiently or inefficiently—by experts in their field. It could very well be said that, given the current travails of ITV, the people in charge are not running it all that well, but at least they are subject to the sanction of the market. Indeed, the breakdown of negotiations between Granada and Carlton was due to the fact that a leak led to a leap in Granada shares and there was not time to get the agreement as speedily as was necessary to satisfy stock exchange regulations. No one in this world, whatever they think of what is broadcast by Sky Digital—although I consider that a great deal of it is high quality, and its news has just won two awards when the BBC's news is faltering and ITN is in a sad state—could say that Sky Digital is not aware of market requirements. The constant technological advances on Sky, such as the advance of Sky interactive, and many other forms of convergence, are being made because those broadcasters know that they must cater to a market.

The BBC is not immune to such pressures, but it is utterly immune to the necessity for awareness of such pressures. That is why the view that I have held for a considerable time, and from which I do not regard—

Brian White

Will my right hon. Friend give way?

Mr. Kaufman

If my hon. Friend will allow me for a moment, I should like to make progress.

I cannot support the amendments because I believe that the present structure of the BBC is utterly out of date in the world in which we are living, let alone the world in which we are about to live. The BBC should have an executive chairman instead of the type of chairman that it has—I am not commenting on Mr. Davies as an individual. It should have a chief executive—not a director general, who is an unanswerable boss. Instead of this tokenistic board of governors, it should have a board—

Mr. Bryant

Will my right hon. Friend give way?

Mr. Kaufman

I will give way to my hon. Friend soon.

The BBC should have a board of directors consisting of people who know about broadcasting, technology and convergence. When, as the hon. Member for South Suffolk said, we have further discussions approaching the charter, the Government must address themselves to such matters, because we cannot go on as we are.

Mr. Bryant

I thank my right hon. Friend enormously for giving way, and it is a delight to hear such a nuanced and moderate set of views on the BBC.

Mr. John Bercow (Buckingham)

And understated.

Mr. Bryant

Indeed, understated views on the BBC.

Mr. Alasdair Milne, the former director general of the BBC, who was, as I understand it, sacked by the governors of the BBC, would be surprised to hear of their supine nature. Would my right hon. Friend like to suggest ways forward to enable broadcasters to prevent people from saying on live programmes things that they might not want to have said? Is it not difficult to regulate after the event?

Mr. Kaufman

I am astonished at my hon. Friend because he is an expert on these matters. I knew Mr. Alasdair Milne very well because I worked with him on "That Was The Week That Was". He was not sacked because the board of governors suddenly decided to be a board of governors but because, as so often in the BBC, his face did not fit. That is what happens in the BBC. If someone's face fits, that is okay; if not, they are out.

I cannot begin to tell the House what respect I have for my hon. Friend, and it amazes me that he seems to be unaware that on a considerable number of programmes "live" does not mean live. The former editor of The Sun., Mr. Kelvin MacKenzie, wrote to me last week about his station, where they run live programmes but create a seven-second delay, to ensure that any unacceptable material can be stopped. If my hon. Friend, who is an intellectual and may not devote himself to these matters, watched the live transmissions of "Big Brother" on E4 last summer, he will know that that programme had a similar delay, so that the casual obscenities used by some of the inhabitants of the house were not broadcast during the pre-watershed period. There is a thing called technology, and that technology—

Mr. Bryant

A popular beat combo, m'Lud.

Mr. Kaufman

Now, now; just because I have squashed my hon. Friend, he should not heckle.

David Winnick (Walsall, North)

Will my right hon. Friend give way?

Mr. Kaufman

No; I will not give way because I have spoken for too long already. [HON. MEMBERS: "No."] I want to conclude.

Of course there are ways of dealing with these matters. One way, if one is running a breakfast-time programme, is not to ask Mr. Ali G on to the programme because everyone knows what he gets up to. Another way, when the BBC broadcasts the BAFTA awards live, is to read Mr. Stephen Fry's script in advance and tell him that certain things that he is planning to say are not acceptable before the watershed.

I regard my hon. Friend the Member for Rhondda (Mr. Bryant) as someone whose expertise far surpasses my amateuristic views on all these matters and I am sad that he should intervene in a way that does not allow me to agree with him.

Miss McIntosh

Perhaps the right hon. Gentleman will agree with me. He will know that BAFTA also had slight delay with the problems that came to light with Russell Crowe's poem not being broadcast, so why the expletives were not removed is a question for the BBC.

Mr. Kaufman

I accept what the hon. Lady says, although I wish that I had been able to hear Russell Crowe's poem; it may well be the best performance that he has ever given.

Mr. Gavyn Davies has proposed, with some desperation, that the BBC should find a new way to regulate itself, but that is an example of "quis custodiet ipsos Custodes?". That is not acceptable to me, so I very much hope that, between now and when the main Bill is introduced, the Government will consider the anomaly into which the BBC might be placed. I ask them to reread the report, issued by the Select Committee on towards the end of the previous Parliament, in which we clearly advocated the subsumption of accountability for the BBC in what is now to be called Ofcom, which we proposed four years ago, and consider a way to remedy the situation, which is not acceptable.

Nick Harvey

Until the draft communications Bill is published, until a Joint Select Committee has had a chance to grill witnesses on the Bill's proposals and until Parliament begins to debate the Bill next Session, the White Paper that was published about 15 months ago remains the most definitive statement of Government policy on the issue. It is worth remembering that the White Paper's proposals did not put the BBC outwith Ofcom's remit. What the White Paper referred to as tier 1 and tier 2 regulation involved putting significant aspects of the BBC's operations under Ofcom; what it referred to as tier 3 predominantly involved self-regulation.

The backstop powers on self-regulation remain an issue, and a separate issue is who will approve future proposals that the BBC may have to develop new services. I am absolutely clear in my mind that Parliament—or, in a practical sense, the Secretary of State—should retain the authority to allow the BBC to develop new services. The BBC will continue to be funded by the licence for the foreseeable future, so it is an absolutely unique institution in that sense. I do not believe that Ofcom should make decisions on the creation of new services—its responsibilities are predominantly competition and protecting consumer interests, which I shall distinguish from the public interest.

I am absolutely clear in my mind that the authority to allow new services should remain with Parliament and the Secretary of State, so the remaining issue is who should oversee—the backstop powers—the tier 3 self-regulation of the BBC. It could be argued that Parliament and the Secretary of State, the BBC governors or Ofcom should have those powers.

I share many of the reservations expressed by the right hon. Member for Manchester, Gorton (Mr. Kaufman), the Chairman of the Culture, Media and Sport Committee, about leaving the powers with the BBC governors. I am not prepared to take a view on whether those powers should be given to Ofcom until we have resolved what its nature, characteristics and purposes will be, and under what broad remit and instructions it will act.

7.45 pm

For that reason, we would prejudge this issue if we were to put the cart before the horse with this relatively minor paving Bill and assume that the powers will be given to Ofcom. The official Opposition spokesman was wrong to suggest that we were in the last-chance saloon—nothing could be further from the truth. It is perfectly obvious that the sensible time to deliberate on that issue will be when we debate the communications Bill in the next Session.

Mr. Bryant

I broadly agree with the hon. Gentleman, but I have a niggling concern about the process of confirming any new service that the BBC governors may like to propose. I am still uncertain whether the Secretary of State should decide and Ofcom provide advice, or whether it should be the other way round, but the more substantive issue that we need to consider for the future is what constitutes a new service. It is easy to say that BBC3 or BBC4 is a new service; it is a new channel in a traditional system that we understand. However, I have been troubled for a long time about one of the gaps in the market: the fact that religion is one of the drivers for internet use. Religion is relatively low in the list, but it is a driver none the less. The BBC has a reputation for independence, yet is has no religious—

Mr. Deputy Speaker

Order. The hon. Gentleman's intervention is developing into a mini speech.

Nick Harvey

Thank you, Mr. Deputy Speaker. The hon. Gentleman is right to suggest that the impact of new BBC services will not be quite so predictable as in the past, because of the speed of technological change. That is the basis on which creating a single regulator has been proposed, but we have not, as yet, thrashed out very clearly what Ofcom's character will be.

There is a slight culture clash between the regulation that the Department of Trade and Industry has traditionally sponsored and that which the Department for Culture, Media and Sport or, before it, the Home Office has tended to favour. I am concerned that Ofcom may be very much more a creature of regulation as the DTI understands it than of regulation as the DCMS or, before it, the Home Office has understood it. If that were to prove correct and if Ofcom were much more concerned with economic considerations, with theoretical models of competition policing and with a narrow definition of the consumer interest, I would have grave misgivings about it being responsible for taking some of the decisions now under discussion.

There is a difference between the consumer interest and the public interest. It can be argued that the consumer interest is served by things that are popular with consumers being on offer at all times, whereas, to return to the point that was being made by the hon. Member for Rhondda (Mr. Bryant), the public interest might be better served by having more religious broadcasting. Those interests are simply not one and the same thing. If Ofcom is to have wide responsibilities for determining what constitutes the public interest, that needs to be written into the legislation that establishes Ofcom far more explicitly than anything in the White Paper led me to believe the Government envisaged or intended.

The development of broadband internet services is an example of the consumer interest and the public interest diverging. Oftel has got the regulation of that issue horribly wrong and has completely lost sight of the public interest because it has taken a very narrow economic view of what constitutes the consumer interest. It has been so concerned to get the economic model of competition theory precisely right that it has significantly held back the development of broadband internet communications in the United Kingdom.

If Ofcom is to get deeply into matters of public interest, that needs to be stipulated not only in terms of what powers it might have over the BBC, but how it will ensure that ITV, Channel 4 and Channel 5—or channels 6, 7 and 8 if they are established—perform under whatever remit they are given. I will not decide whether Ofcom is the right body to have backstop powers for the BBC until we have hammered out some of the arguments and know much more about the colour of Ofcom.

I am not saying that I will die in the ditch to defend the status quo. The BBC is far from perfect. Some of the regulatory mechanisms that govern the BBC are self-evidently flawed, and the right hon. Member for Manchester. Gorton gave examples of that. The BBC is more inclined to be impervious to criticism than commercial broadcasters because their regulators have had the power to instruct more remedies. In the new regime that we anticipate, the BBC must be more susceptible to instructions from external regulation.

Mr. Wyatt

I can get the BBC on my computer, but as I do not have a television licence for that I should be arrested and locked up.

Mr. Bryant

So the law says.

Mr. Wyatt

Indeed, and there are many women in Holloway who have not paid the licence fee. However, to return to my substantive point, convergence means just that. We need to consider how the licence fee gets collected and the fact that under the current regulatory system there is no one to whom the BBC can complain. It needs to be covered by Ofcom. Its funding needs to change because it cannot collect the fee if people can receive its transmissions through broadband. It is an issue.

Nick Harvey

The hon. Gentleman makes a good point. The BBC will be covered by Ofcom in a considerable sense. The material issue of concern relates to the backstop powers that determine whether it fulfils the statement of programming that it proposes as part of the tier 3 regulation. The issues to which the hon. Gentleman refers can be taken to Ofcom under the proposals as laid out in the White Paper.

If the BBC and its regulation is far from perfect, so is the system of the BBC governors. I found myself agreeing with the right hon. Member for Manchester, Gorton, who spoke for longer than I expected. However, it makes no sense to put all that right in a paving Bill. I am not even convinced it would make sense to crack open that nut in the communications Bill, although I am open to persuasion. It would probably make more sense to hammer out who has the backstop powers and get Ofcom up and running for two or three years before we resolve the problems to which the right hon. Gentleman rightly referred when we deal with the charter renewal in 2006.

The BBC has a proud heritage and a strong position in the world. Of course the rest of the broadcasting sector wants the BBC regulated by Ofcom—you bet they do! It is delighted at the thought that the BBC, unique though its history and position are, will be put into the hands of a regulator whose views may be fashioned entirely by economic rather than public interest considerations.

Mr. Kaufman

The hon. Gentleman exposes one of the hypocrisies of the commercial sector, but there is another. The one aspect of the market in which commercial broadcasters do not want the BBC to be involved is advertising. They fear that the BBC, which is a popular broadcaster even now with its dwindled and dwindling audience, will take advertising away from them. Apart from the hon. Gentleman, myself and a few others, no one else who is engaged in the debate is totally objective.

Nick Harvey

The right hon. Gentleman makes a good point about advertising. In addition, commercial broadcasters would take exception to my suggestion that Ofcom should have written into its remit more explicit public interest powers than the White Paper anticipates. The last thing the commercial sector wants is for its activities to be regulated by Ofcom with reference to a more widely defined public interest consideration. It cannot have it both ways. If the BBC is not going to invade its advertising market but remain essentially a public service broadcaster with a public interest objective and a public service remit, it cannot be treated and regulated in the same way as the commercial sector.

There are big issues to resolve before it makes sense to do what the amendments suggest and set the cart before the horse. Let us hammer out what Ofcom is going to be and determine that it will be fit to take on the powers. Let us not prejudge the issue and throw the BBC to the wolves.

Brian White

The hon. Member for North Devon (Nick Harvey) has obviously read my speech, 90 per cent. of which I have had to cut because I agree with him entirely.

I tried to make it clear in Committee that this is a communications Bill, not a broadcasting Bill, but we are none the less falling into the same trap on this occasion. I fear that the amendment could perpetuate the argument about the BBC to the detriment of the communications industry and the establishment of Ofcom. That would do major damage. Ofcom would become dominated by arguments about the BBC and the role of the board of governors. Although my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) may be right about the deterioration of the BBC's standards in its terrestrial news broadcasts, he should recognise the innovative and superb work that it has done on its web pages and on BBC news online, which marks a tremendous step forward.

Ofcom's role is a real issue in this paving Bill, but it should not become dominated by arguments about regulation of the BBC. The key issues—Ofcom's relevance to the European Union framework directive; how it will interact with existing regulators and the European regulatory group; and market dominance, to which the hon. Member for North Devon referred—will be subsumed by arguments about the BBC.

I do not agree with the hon. Member for South Suffolk (Mr. Yeo) who argued that the way to kill the argument is to cover the BBC in the Ofcom paving Bill. It is important that consultation and pre-legislative scrutiny identify that as a key issue for public consultation as part of the communications Bill, but to address it now will cause the problems that the hon. Gentleman wants to avoid. We must not deal with that problem at the expense of the rest of the communications industry.

Michael Fabricant

The hon. Member for Milton Keynes, North-East (Brian White) has been a powerful advocate for the other elements to which Ofcom will have regard. As he rightly says, broadcasting is not the only one to consider. However, I disagree with him and the hon. Member for North Devon (Nick Harvey) when they say that now is not the time to debate whether we include the BBC under the auspices of Ofcom.

Amendment No. 7 relates to clause 6, which sets out what is meant by the "existing regulator". The clause refers to the Broadcasting Standards Commission … the Director General of Telecommunications"— otherwise known as Oftel— the Independent Television Commission … the Radio Authority". My hon. Friend the Member for South Suffolk (Mr. Yeo) has argued long and cogently, as has the right hon. Member for Manchester, Gorton (Mr. Kaufman), that there is an omission, and that the BBC and its governors ought to be included. They are right.

8 pm

The hon. Member for Milton Keynes, North-East says that to include the BBC would result in continuing arguments within Ofcom about BBC issues, but that is not the case. The big argument is whether Ofcom would control the BBC in the sense of the third tier having access to the BBC. Once the BBC came under the auspices of Ofcom, there would be no further argument because, as several hon. Members have said, on the whole the BBC does a pretty good job. At times, of course, the BBC has shown itself to be a bad governor of its own operations, and the right hon. Member for Manchester, Gorton gave two recent and powerful examples of that. But the BBC has a unique role in British broadcasting, and indeed in world broadcasting, and bringing it under the auspices of Ofcom would strengthen it, not weaken it.

This is the very time at which we should be debating that matter. The hon. Member for North Devon is utterly wrong when he says that this is not the time and place to be discussing the BBC, but he is certainly right when he says that we will be discussing it when a communications Bill comes before the House in a year or so, if indeed it appears.

Why should the BBC be included? Recently, the Scottish Media Group made submissions to the Department for Culture, Media and Sport and to the Select Committee about the method of measuring the degree of cross-media ownership. How does one compare the radio listener with the television viewer? Does one equal the other? The formula that the Scottish Media Group came up with is simple—it uses overall revenue. Of course, the BBC's revenue comes from the licence fee, and not from the sale of advertising time. It receives a small degree of revenue from the world sales of programming, but only to the tune of a net profit of £50 million. The point is that its total revenue is about £2.5 billion; it is a major player. To say that it should be ignored is an insult not only to the BBC but to its listeners and viewers.

The right hon. Member for Manchester, Gorton began to paint a picture of how the royal charter came about. Let me briefly add to that and remind colleagues that the BBC started as the British Broadcasting Company in 1922. It operated five separate radio stations around the United Kingdom. One was just down the road at Savoy Hill 2L0 in London, and there were others in Bournemouth, Leeds and Birmingham. At that time, the BBC was the only broadcaster, and the idea behind the royal charter was to create a unique monopoly position for it. The royal charter was wholly appropriate at that time. It was advocated by the then managing director of the company, Sir John Reith, who later became Lord Reith.

What was appropriate in 1926 is not appropriate now. Indeed, as my hon. Friend the Member for South Suffolk said, what might have been appropriate five or six years ago is not appropriate now because of the changes in technology, in delivery and in the many different platforms by which television and radio can he delivered to viewers and listeners.

Mr. Kaufman

The hon. Gentleman was present at a sitting of the Select Committee the other day when I made a point that I think it may be useful to place on record in the Chamber. The BBC is the only organisation in this country, in either the private or the public sector, which is organised and governed in precisely the same way as it was 75 years ago. No other public sector organisation—not the NHS, which is not as old as the BBC, nor the pension system, nor the income support system—is administered as it was only a few years ago. The private sector changes all the time. The BBC says, "Stick to the way in which we were organised and financed on 1 January 1927."

Michael Fabricant

The right hon. Gentleman is correct. It is not only a question of the length of time during which the structure has remained static; what is even more extraordinary is the background of the degree to which the broadcasting environment has changed. Even if one compares the BBC with the NHS, established in 1948, one finds that the needs and structure of the NHS have changed less than the broadcasting environment because of all the technological changes in broadcasting. The idea that what was suitable when the BBC had a monopoly in 1927 is suitable now is risible and has to be addressed. As the right hon. Gentleman said, if it is not dealt with now, it will have to be tackled by Parliament some time, because in June 2006, when the BBC charter has to be renewed, surely that will not be done yet again by a compliant Government.

That would be wrong, primarily because of perception. It is utterly wrong that the BBC should be perceived to be its own judge and jury in so many different issues. The chairman of the BBC clearly recognises that point. By publishing the document, "BBC Governance in the Ofcom Age", he seeks to give greater independence and more muscle to the board of governors.

The right hon. Member for Manchester. Gorton rightly points out that the whole history of the BBC—and to anyone who argues with this point I commend the excellent books on the subject by Lord Asa Briggs—shows that the board of governors tends to be compliant to the director general and the board of management. Perhaps the changes proposed by the chairman will help somewhat, but I do not think that they will be a complete solution. They will certainly not give the appearance of the BBC being accountable to an outside body, and that is the whole point.

Two areas are addressed in "BBC Governance in the Ofcom Age". One is programme content and the other is fair trading. There have been numerous claims in the past few years that the BBC has used its unique position, funded by the licence payer, to trade unfairly against commercial organisations that have to operate in the real world, where their revenue is generated by sales. Those claims may or may not be true, but people who make them continue to believe that the BBC is not addressing the problem. My God, if I were chairman of the BBC, I would welcome Ofcom's independent scrutiny and judgment on that issue. But what can the chairman do? What can the director general do? All he can say is, "We have had an internal inquiry, and it found us innocent." Well, innocent they may be, but people do not believe it because they do not believe any organisation that is its own judge and jury.

Nick Harvey

The hon. Gentleman comments on how those commercial activities might be perceived to work directly against the interests of other commercial organisations, but surely it is anticipated that Ofcom will be given precisely the relevant powers in the lower tiers mentioned in the White Paper.

Michael Fabricant

No, the hon. Gentleman is wrong. It is for that very reason that the issue is now being addressed by the BBC. The BBC perceives that fair trading does not come under tiers 1 and 2, which is precisely why it is making changes to the board of governors to address that issue. Perhaps the hon. Gentleman has not seen the letter by Gavyn Davies, which appears to have been circulated quite widely—

Nick Harvey

indicated dissent.

Michael Fabricant

I see that he has not, perhaps because his is a minority party. After the debate, I shall photocopy the letter and put it on the Board for him, so that he can see that fair trading is an issue of which the BBC is conscious, because it has been criticised in the past on that ground. I think that the BBC would welcome coming into the ambit of Ofcom—and it ought to be so. Given that BBC revenues total £2.5 billion and it represents a major proportion of British broadcasting, it would be anathema were it not to come within Ofcom's ambit.

The BBC gives many reasons why it should not become a part of Ofcom. One such reason is that it occupies a unique position—but no one here today has argued that the BBC should not continue to occupy a unique position. I half expected the right hon. Member for Manchester, Gorton to argue about the way in which the BBC is funded, but he chose not to do so today. I shall not do so either, because for all sorts of economic reasons I do not believe that the BBC can be privatised, nor do I believe that British broadcasting would be assisted if it were.

No one is arguing that the BBC's unique position should be weakened in any way. In fact, as I said. I believe that the BBC's position would be strengthened by its becoming a part of Ofcom. The BBC says that its position is unique because it is a public service broadcaster—but as the right hon. Gentleman rightly says, so are Channel 4 and S4C, and many would say that many aspects of ITV broadcasting constitute public service broadcasting, yet they willingly come within Ofcom's ambit.

Time has moved on since 1 January 1927. Even Parliament in its procedures is changing; perhaps the next few months hold radical changes to the way in which we operate. It seems to me that only one organisation, uniquely in the United Kingdom, has not changed: the BBC. The BBC is unique not because of the way in which it is funded, nor because of the fact that it is a public service broadcaster, but because since 1 January 1927 it has succeeded in not changing its structure, despite the fact that it exists in a dynamic and changing world.

Mr. John Grogan (Selby)

My right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman) said that there were two objective people in the Chamber tonight: himself and the hon. Member for North Devon (Nick Harvey). I shall take up and reinforce three points made by the latter.

First, the hon. Gentleman said, and I agree, that this is not the last opportunity Parliament will have to determine the relationship between the BBC and Ofcom. My right hon. Friend the Member for Manchester, Gorton will see to it that in years to come we spend many happy hours discussing such matters. Not only is there the prospect of the communications Bill, but there is to be a pre-legislative scrutiny Committee on that Bill and further opportunities during the run-up to charter renewal.

The hon. Member for North Devon is right to say that the character of the Ofcom regulator and its relationships with not only the BBC but other public service broadcasters cannot be determined until the main Bill is produced. It is not clear what powers Ofcom will have in tier 3 regulation—the backstop powers he mentioned—in relation to ITV, never mind the BBC.

8.15 pm

The chairman of the BBC has appeared before the Culture, Media and Sport Committee since Second Reading. My right hon. Friend the Member for Manchester, Gorton refers to himself as an amateur; perhaps he is, but he is also a class act who draws in the crowds. I could hardly get into the room that day—it was heaving. I just managed to squeeze into the corner. The chairman of the BBC began by saying that he agreed with much that my right hon. Friend had said on Second Reading. He said of the BBC: In fact, if anything, it should be regulated rather more robustly than other broadcasters, given its unique access to the licence fee. He added that on one or two issues of detail … I think there are nuances of difference between us"— that is, between my right hon. Friend and the BBC. Nevertheless, the BBC accepts that it will be subject to more regulation under Ofcom than at any time before.

It is worth running through the three tiers. The hon. Member for Lichfield (Michael Fabricant) mentioned economic regulation. The chairman of the BBC was unambiguous, telling the Select Committee: In the case of economic regulation, basic standards and quotas (Tiers 1 and 2) the BBC will be treated just like any other broadcaster and will be fully within OFCOM's remit … that is only right and proper and we welcome this change. For the first time, the BBC will be subject to regional programme quotas and to ensuring that news is in prime time. In terms of its economic responsibilities, it will be very much under Ofcom's wing. The hon. Member for North Devon put his finger on the issue when he referred to Ofcom's backstop powers and any role it may have in the creation of new channels. I, too, feel suspicious. My right hon. Friend the Member for Manchester, Gorton mentioned advertising: it is not only commercial broadcasters who do not like the idea of the BBC advertising—parents dislike the idea as well. They welcome new BBC children's channels because of the absence of excessive advertising during programmes that are specifically for children. That is one of the great attractions of the BBC. Many listeners to Radio 1 and Radio 2 hope that the Opposition do not decide to adopt a policy of privatisation of those stations. People like to listen to radio programmes and watch sport on television without interruptions from advertising.

Ofcom will primarily be an economic regulator and a light-touch regulator of public service broadcasters other than the BBC. Can it combine the skills needed for light-touch regulation of ITV and Channel 4, which will be far more unregulated than ever before, with the very different skills needed to ensure that our main public service broadcaster continues year on year to produce the public service programmes on which its reputation depends and on which its support in the House and the country depends? Can Ofcom really combine those two roles?

As I said, the House will spend many happy hours discussing those issues. There is no need at this stage, during the establishment of the shadow Ofcom, to tear up the broadcasting ecology that has served our nation for many years. Changes will have to be made, and the White Paper mentions measures that will fundamentally change the way in which the BBC operates, and its relationship with the regulators affecting it, but we should preserve all that is good in the BBC. I am glad to see that many hon. Members acknowledge that there is much that is good and that must be preserved.

Glenda Jackson (Hampstead and Highgate)

I will not detain the House long. I oppose the amendments, essentially for the reasons put forward by the hon. Member for North Devon (Nick Harvey), my hon. Friend the Member for Selby (Mr. Grogan) and my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman). It seems to be putting the cart before the horse to attempt to introduce that kind of regulation under such a small paving Bill.

I leapt to my feet essentially to take issue with the idea that the BBC is a unique organisation on any level other than the way it is funded. It is no longer unique as a public service broadcaster. Previous speakers have referred to the BBC's capacity to introduce new channels. The BBC is not introducing new channels; it is introducing additional programmes. I regret that I feel impelled to repeat what my right hon. Friend the Member for Manchester, Gorton has said. I find it outrageous that the BBC has seen fit to introduce its new, fourth channel which has been funded by everyone who has to buy a television licence in this country and yet is accessible only to that minority who have digital television. I do not exclude the commercial operators of the service when I say that the quality of the programmes is execrable in the main. They tend to be based on repeats—certainly that is true of the programmes that the BBC is broadcasting—and remarkably banal.

Regrettably, in this country, culture, art, intellectual practices and expertise are still in many instances regarded as minority interests. I believe that the BBC's new channel will mean an even greater reduction in such programmes and a reduction of interest in its existing channels. For the BBC to be able to avoid what I understood was one of the central planks of its existing, supposedly unique, nature—that of serving minority interests—seems to highlight how over the past decade, if not longer, it has believed that it meets its unique situation exclusively by virtue of the way it is funded, and increasingly forgets its public service broadcasting responsibility.

The BBC used to be an international byword for quality programmes. It gives me no pleasure to say that I think that reputation has been lost in leaps and bounds, not least in respect of its news broadcasts. As someone said to me, "If you want to know what has happened, you turn to Sky." It is almost impossible to get any kind of up-to-date news on the BBC. It spent an absolute fortune on introducing the 24-hour news broadcasting programme which, on its own analysis, is watched internationally and nationally by such a small audience that it does not even come up on the percentage scale. I strongly agree about the backstop for how the BBC adapts to the future, when we will see ever greater convergence between broadcasting and communications.

I was particularly grateful that the Government introduced free licences for 75-year-olds because of the litany that I inevitably heard from my pensioners. They objected to paying the licence fee because they were categoric that they never watched any BBC programme on any of the BBC channels. I would hate to see the day dawn when that feeling was more general across the country.

For the past decade, the BBC seems to have lost belief in its own identity. It believes that it has to compete with commercial stations so that it is not unique but similar in its competitive activities and programming to the commercial sector.

We have in television—one aspect of broadcasting and communications—a unique medium that has never been exploited to the full. It has never brought the greatest possible benefits to the millions of people who watch it world wide. The BBC could, perhaps, begin to forge a new path. I may be maligning the director general and the board of governors, but I think they would love to be able to have advertising in their programmes. However, if they are increasingly forced into a corner so that the process takes longer, more people are involved and the product is produced by someone else more speedily and economically, it will lose its position as the great pinnacle of broadcasting excellence. The BBC is no longer in that position, and I would hate to see it slide even further down that slippery slope. I sincerely hope it will rise again, and the amendment will do nothing to encourage the BBC to aim higher.

Dr. Howells

We have had a wide-ranging debate about how a relationship between Ofcom and the BBC might look after the scrutiny and debate by Parliament and the Joint Committee of both Houses of a substantive communications Bill. We devoted a number of hours to this subject in Committee, and I have no doubt, as my hon. Friend the Member for Selby (Mr. Grogan) put it, that we will spend many more happy hours discussing this in the communications Bill. I am not one to throw a wet blanket over such enjoyable occasions, but the Bill is not about that—it is about setting up Ofcom.

Taken together, amendments Nos. 6, 7 and 8 would make the BBC an "existing regulator" for certain purposes in the Bill, alongside the other regulators. The amendments are the same as those put forward in Committee, so they have been discussed at great length. I made it clear then that the purpose of the Bill is only to set up Ofcom and its initial functions. At that time, I circulated a detailed briefing note to hon. Members so that they were clear on the Government's policy on the BBC and Ofcom, as set out in the White Paper. I appreciate that the BBC's place in the new regulatory structure and its relationship with Ofcom is the subject of much debate, and so it should be. However, the appropriate time for a detailed discussion on the issue will be when the draft communications Bill is published in the spring.

I resist the amendments because clause 2 gives Ofcom the power that it needs to facilitate or secure the modification of any proposals concerning the BBC. Under subsection (1), Ofcom has the power to do whatever is appropriate in preparing for its task. The BBC's charter will allow it to prepare for implementing our legislative proposals. The phrase whether by transfers from the existing regulators or otherwise has been included in subsection (3). That means that Ofcom's power is not limited to transfers from existing regulators, as defined in the Bill, but can also include transfers from the BBC. I am satisfied that the powers in the Bill are sufficient to cover the points that have been debated. They will allow Ofcom and the BBC to make preparations for implementing the new regulatory regime. They do not prevent proper debate of the exact relationship between Ofcom and the BBC when the time comes, nor do they pre-empt the outcome of that debate. I therefore oppose the amendments.

Mr. Yeo

This has been an excellent debate, and I am grateful to all those who have taken part in it.

I should like to reply to the Minister's comments. We have not brought forward the amendment at this stage because it is the last opportunity to do so. The hon. Member for North Devon (Nick Harvey) was wrong to claim that I said it was. It clearly is not, as the Minister has explained. There will be an opportunity to do so under the forthcoming communications Bill. However, this seems to be the most appropriate opportunity, not least because this paving Bill lists the regulators whose functions are to be taken over by Ofcom and because it will be much more sensible to have the debate about Ofcom's functions when we know what organisations it will be responsible for. I am afraid that it is those who are resisting the amendment who are in danger of getting the cart and the horse the wrong way round, not those who share our views.

8.30 pm

I am sorry that we seem unlikely to have the right hon. Member for Manchester, Gorton (Mr. Kaufman) with us in the Lobby. He is a powerful advocate of the merits of an external regulator, and he was right to question the effectiveness of the present accountability arrangements of the BBC. He made it clear that he does not want the BBC to be ignored by Ofcom—far from it. The difference between the right hon. Gentleman and me is one of means, rather than ends. In due course, perhaps, there will be opportunities to try to reach a shared position.

I am sorry also that we will not have the support of the Liberals this evening. The hon. Member for North Devon (Nick Harvey) seemed unable to decide what the party's view should be. He said that that would have to wait until Ofcom had been debated in more detail, but that misses the point. The question is one of principle: whether we believe that the BBC should be regulated in a manner similar to the other organisations operating in the field. The Liberal party clearly does not. It wishes to preserve a privileged position, for whatever reason, for the BBC. The clue to the Liberal position was in the dying phrase of the hon. Gentleman's speech, when he said that putting the BBC within the remit of Ofcom would be throwing it to the wolves. That did not suggest to me that he would approach the future debates in an open-minded manner.

On the contribution of the hon. Member for Milton Keynes, North-East (Brian White), I entirely accept that there are many other issues in the Bill, but this is the one that is before the House. That is why I have been addressing it. There will be a chance to address or return to some of the others later.

My hon. Friend the Member for Lichfield (Michael Fabricant) is a powerful advocate of the case that I have tried to advance. When I listened to his views, it made me think that on this issue I had been right to say what I had said earlier.

The hon. Member for Selby (Mr. Grogan), like a number of those who oppose the amendment, seemed to assume that including the BBC within Ofcom would somehow stop the governors carrying out their function of scrutinising how the BBC was meeting or failing to meet its public service obligations. It would do nothing of the sort. The governors would still have that function. They would be the first stop and Ofcom would be the backstop, to use the language that others have adopted.

The hon. Member for Hampstead and Highgate (Glenda Jackson) criticised the way the BBC is moving away from a strict public service role, perhaps in pursuit of higher ratings. I am sure that that is a widely held concern. My only regret is that the hon. Lady does not conclude from it that some change in the present regulatory arrangements is needed, and needed urgently.

As I explained at the outset, amendment No. 7 is the crucial amendment in the group. I therefore beg to ask leave to withdraw amendment No. 6.

Amendment, by leave, withdrawn.

Amendment proposed: No. 7, in page 5, line 28, at end insert— '(aa) the BBC Board of Governors.'.—[Mr. Yeo.]

Question put, That the amendment be made:—

The House divided: Ayes 121, Noes 308.

Division No. 185] [8.33 pm
Amess, David Jack, Rt Hon Michael
Arbuthnot, Rt Hon James Jackson, Robert (Wantage)
Atkinson, David (Bour'mth E) Key, Robert
Atkinson, Peter (Hexham) Kirkbride, Miss Julie
Bacon, Richard Knight, Rt Hon Greg (E Yorkshire)
Barker, Gregory Laing, Mrs Eleanor
Baron, John Leigh, Edward
Beggs, Roy Lewis, Dr Julian (New Forest E)
Bellingham, Henry Liddell—Grainger, Ian
Bercow, John Lilley, Rt Hon Peter
Beresford, Sir Paul Loughton, Tim
Blunt, Crispin Luff, Peter
Boswell, Tim McIntosh, Miss Anne
Brady, Graham MacKay, Rt Hon Andrew
Brazier, Julian Maclean, Rt Hon David
Browning, Mrs Angela McLoughlin, Patrick
Burns, Simon Malins, Humfrey
Burnside, David Maples, John
Cash, William Mates, Michael
Chope, Christopher Mawhinney, Rt Hon Sir Brian
Clarke, Rt Hon Kenneth (Rushcliffe) May, Mrs Theresa
Mercer, Patrick
Collins, Tim Mitchell, Andrew (Sutton Coldfield)
Conway, Derek Murrison, Dr Andrew
Davis, Rt Hon David (Haltemprice) Norman, Archie
Djanogly, Jonathan O'Brien, Stephen (Eddisbury)
Dorrell, Rt Hon Stephen Ottaway, Richard
Duncan, Alan (Rutland & Melton) Page, Richard
Duncan, Peter (Galloway) Paice, James
Evans, Nigel Paterson, Owen
Fabricant, Michael Prisk, Mark
Flook, Adrian Randall, John
Forth, Rt Hon Eric Redwood, Rt Hon John
Fox, Dr Liam Robertson, Laurence (Tewk'b'ry)
Francois, Mark Roe, Mrs Marion
Garnier, Edward Rosindell, Andrew
Gibb, Nick Ruffley, David
Gillan, Mrs Cheryl Sayeed, Jonathan
Goodman, Paul Selous, Andrew
Gray, James Shephard, Rt Hon Mrs Gillian
Greenway, John Shepherd, Richard
Grieve, Dominic Simmonds, Mark
Gummer, Rt Hon John Simpson, Keith (Mid-Norfolk)
Hague, Rt Hon William Smyth, Rev Martin (Belfast S)
Hammond, Philip Spelman, Mrs Caroline
Hawkins, Nick Spicer, Sir Michael
Hayes, John Spink, Bob
Heald, Oliver Stanley, Rt Hon Sir John
Heathcoat—Amory, Rt Hon David Steen, Anthony
Hermon, Lady Streeter, Gary
Hoban, Mark Swire, Hugo
Horam, John Syms, Robert
Howarth, Gerald (Aldershot) Tapsell, Sir Peter
Taylor, Ian (Esher& Walton) Wiggin, Bill
Taylor, John (Solihull) Wilkinson, John
Taylor, Sir Teddy Winterton, Mrs Ann (Congleton)
Trend, Michael Winterton, Nicholas (Macclesfield)
Trimble, Rt Hon David Yeo, Tim
Turner, Andrew (Isle of Wight) Young, Rt Hon Sir George
Tyrie, Andrew
Viggers, Peter Tellers for the Ayes:
Waterson, Nigel Mr. Charles Hendry and
Watkinson, Angela Mr. Desmond Swayne.
Ainsworth, Bob (Cov'try NE) Dalyell, Tam
Alexander, Douglas Davey, Valerie (Bristol W)
Allen, Graham David, Wayne
Anderson, Janet (Rossendale) Davidson, Ian
Armstrong, Rt Hon Ms Hilary Davies, Rt Hon Denzil (Llanelli)
Atherton, Ms Candy Davies, Geraint (Croydon C)
Atkins, Charlotte Davis, Rt Hon Terry (B'ham Hodge H)
Austin, John
Bailey, Adrian Dawson, Hilton
Baird, Vera Dean, Mrs Janet
Barnes, Harry Dhanda, Parmjit
Barrett, John Dismore, Andrew
Barron, Kevin Dobbin, Jim
Beard, Nigel Donohoe, Brian H
Beckett, Rt Hon Margaret Doran, Frank
Bell, Stuart Doughty, Sue
Benn, Hilary Dowd, Jim
Bennett, Andrew Dunwoody, Mrs Gwyneth
Benton, Joe Eagle, Angela (Wallasey)
Berry, Roger Eagle, Maria (L'pool Garston)
Blears, Ms Hazel Efford, Clive
Blizzard, Bob Ellman, Mrs Louise
Borrow, David Ennis, Jeff
Bradley, Rt Hon Keith (Withington) Ewing, Annabelle
Bradley, Peter (The Wrekin) Fisher, Mark
Bradshaw, Ben Foster, Rt Hon Derek
Brooke, Mrs Annette L Foster, Don (Bath)
Brown, Russell (Dumfries) Foster, Michael (Worcester)
Bryant, Chris Foster, Michael Jabez (Hastings)
Burden, Richard Foulkes, George
Burgon, Colin Francis, Dr Hywel
Byers, Rt Hon Stephen Galloway, George
Cairns, David Gardiner, Barry
Calton, Mrs Patsy George, Andrew (St Ives)
Campbell, Alan (Tynemouth) George, Rt Hon Bruce (Walsall S)
Campbell, Mrs Anne (C'bridge) Gerrard, Neil
Campbell, Rt Hon Menzies (NE Fife) Gibson, Dr Ian
Gidley, Sandra
Campbell, Ronnie (Blyth V) Gilroy, Linda
Caplin, Ivor Godsiff, Roger
Carmichael, Alistair Green, Matthew (Ludlow)
Casale, Roger Griffiths, Jane (Reading E)
Caton, Martin Griffiths, Win (Bridgend)
Cawsey, Ian Grogan, John
Challen, Colin Hall, Mike (Weaver Vale)
Chaytor, David Hall, Patrick (Bedford)
Clapham, Michael Hamilton, David (Midlothian)
Clark, Mrs Helen (Peterborough) Hancock, Mike
Clark, Paul (Gillingham) Hanson, David
Clarke, Rt Hon Tom (Coatbridge) Harris, Tom (Glasgow Cathcart)
Clarke, Tony (Northampton S) Harvey, Nick
Clelland, David Healey, John
Coaker, Vernon Heath, David
Coffey, Ms Ann Henderson, Doug (Newcastle N)
Connarty, Michael Henderson, Ivan (Harwich)
Cook, Rt Hon Robin (Livingston) Hendrick, Mark
Cotter, Brian Hepburn, Stephen
Cousins, Jim Heyes, David
Cranston, Ross Hill, Keith
Crausby, David Hinchliffe, David
Cryer, John (Hornchurch) Hood, Jimmy
Cummings, John Hope, Phil
Cunningham, Jim (Cov'try S) Hopkins, Kelvin
Cunningham, Tony (Workington) Howarth, Rt Hon Alan (Newport E)
Howarth, George (Knowsley N) Morgan, Julie
Howells, Dr Kim Mudie, George
Hughes, Beverley (Stretford) Mullin, Chris
Humble, Mrs Joan Munn, Ms Meg
Hurst, Alan Murphy, Denis (Wansbeck)
Iddon, Dr Brian Murphy, Jim (Eastwood)
Illsley, Eric Murphy, Rt Hon Paul (Torfaen)
Irranca—Davies, Huw Naysmith, Dr Doug
Jackson, Glenda (Hampstead) Norris, Dan
Jackson, Helen (Hillsborough) O'Brien, Bill (Normanton)
Jamieson, David Olner, Bill
Jenkins, Brian Öpik, Lembit
Jones, Helen (Warrington N) Osborne, Sandra (Ayr)
Jones, Jon Owen (Cardiff C) Perham, Linda
Jones, Kevan (N Durham) Picking, Anne
Jones, Lynne (Selly Oak) Pickthall, Colin
Jones, Martyn (Clwyd S) Pike, Peter
Joyce, Eric Plaskitt, James
Kaufman, Rt Hon Gerald Pollard, Kerry
Keen, Ann (Brentford & Isleworth) Pond, Chris
Kemp, Fraser Pope, Greg
Kidney, David Prentice, Ms Bridget (Lewisham E)
King, Andy (Rugby & Kenilworth) Prescott, Rt Hon John
Kirkwood, Archy Price, Adam
Knight, Jim (S Dorset) Prosser, Gwyn
Kumar, Dr Ashok Pugh, Dr John
Ladyman, Dr Stephen Purchase, Ken
Lamb, Norman Purnell, James
Lammy, David Quin, Rt Hon Joyce
Lawrence, Mrs Jackie Quinn, Lawrie
Laws, David Rammell, Bill
Laxton, Bob Rapson, Syd
Lazarowicz, Mark Reed, Andy (Loughborough)
Lepper, David Reid, Alan (Argyll & Bute)
Leslie, Christopher Robertson, Angus (Moray)
Levitt, Tom Robertson, John (Glasgow Anniesland)
Lewis, Ivan (Bury S)
Lewis, Terry (Worsley) Roche, Mrs Barbara
Liddell, Rt Hon Mrs Helen Rooney, Terry
Linton, Martin Ross, Ernie
Lloyd, Tony Roy, Frank
Llwyd, Elfyn Ruane, Chris
Love, Andrew Ruddock, Joan
Lucas, Ian Russell, Bob (Colchester)
Luke, Iain Russell, Ms Christine (Chester)
McAvoy, Thomas Salter, Martin
McCafferty, Chris Sanders, Adrian
McDonagh, Siobhain Sawford, Phil
MacDonald, Calum Sedgemore, Brian
McDonnell, John Shaw, Jonathan
MacDougall, John Sheridan, Jim
McGuire, Mrs Anne Simpson, Alan (Nottingham S)
McIsaac, Shona Singh, Marsha
McKechin, Ann Skinner, Dennis
McKenna, Rosemary Smith, Angela (Basildon)
Mactaggart, Fiona Smith, Rt Hon Chris (Islington S)
McWalter, Tony Smith, Geraldine (Morecambe)
McWilliam, John Smith, Jacqui (Redditch)
Mahmood, Khalid Smith, Llew (Blaenau Gwent)
Mahon, Mrs Alice Spellar, Rt Hon John
Mallaber, Judy Squire, Rachel
Mann, John Starkey, Dr Phyllis
Marris, Rob Steinberg, Gerry
Marsden, Gordon (Blackpool S) Stewart, David (Inverness E)
Marsden, Paul (Shrewsbury) Stinchcombe, Paul
Marshall, Jim (Leicester S) Stoate, Dr Howard
Meacher, Rt Hon Michael Stringer, Graham
Merron, Gillian Sutcliffe, Gerry
Michael, Rt Hon Alun Tami, Mark
Milburn, Rt Hon Alan Taylor, Rt Hon Ann (Dewsbury)
Miliband, David Taylor, David (NW Leics)
Mitchell, Austin (Gt Grimsby) Thomas, Gareth (Clwyd W)
Moffatt, Laura Thomas, Gareth R (Harrow W)
Mole, Chris Todd, Mark
Moore, Michael Touhig, Don
Moran, Margaret Trickett, Jon
Turner, Dennis (Wolverh'ton SE) Williams, Mrs Betty (Conwy)
Turner, Dr Desmond (Kemptown) Williams, Hywel (Caernarfon)
Turner, Neil (Wigan) Williams, Roger (Brecon)
Twigg, Derek (Halton) Willis, Phil
Twigg, Stephen (Enfield) Winnick, David
Tyler, Paul Wishart, Pete
Tynan, Bill Wood, Mike
Walley, Ms Joan Woodward, Shaun
Ward, Ms Claire Woolas, Phil
Wareing, Robert N Wray, James
Watson, Tom Wright, Anthony D (Gt Yarmouth)
Watts, David Wright, David (Telford)
Webb, Steve Wright, Tony (Cannock)
Weir, Michael Younger-Ross, Richard
White, Brian
Whitehead, Dr Alan Tellers for the Noes:
Williams, Rt Hon Alan (Swansea W) Mr. Nick Ainger and
Mr. John Heppell.

Question accordingly negatived.

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