Digital Television

HC Deb 13 May 2002 vol 385 cc488-90

3. Mr. David Amess (Southend, West)

What discussions she has had with Carlton and Granada since 26 April on digital television. [53964]

The Minister for Tourism, Film and Broadcasting (Dr. Kim Howells)

Since 26 April, Ministers and officials in the Department for Culture, Media and Sport have continued our regular contacts with Carlton and Granada, which are members of the ITV network and digital television stakeholders through ITV's interest in the Digital 3 and 4 licence.

Mr. Amess

Is the Minister aware that a hard pressed club such as Southend United stands to face a shortfall of £238,000 over the next two years as a result of the collapse of digital television? Is he further aware that clubs such as Southend United feel that Carlton and Granada have some responsibility in the matter? Will he please clarify the situation and do everything that he can to help Southend United football club even if it means playing for it?

Dr. Howells

Did the hon. Gentleman say, "Even if it is painful"?

My right hon. Friend the Minister for Sport has been very active in trying to broker new arrangements and new talks to ensure that football clubs do not suffer overly as a result of the contracts that they signed with ITV Digital.

Mr. Peter Pike (Burnley)

Does my hon. Friend recognise that even a club such as Burnley now faces a £;3 million gap in its funding and has had to put all its policies for progress on hold until the position is clarified? Will he not accept that the House should clearly condemn Carlton and Granada? Even if they do not have a legal responsibility, they have a moral responsibility and they should get on and sort out the problems for the sake of football in this country.

Dr. Howells

Whatever I may think about the morality or otherwise of the contract that was entered into, it was a commercial contract between two sets of companies. We must treat it as such.

Michael Fabricant (Lichfield)

Will the Minister confirm that, under the terms of the draft Communications Bill, Carlton and Granada would be able to combine and form, in effect, one ITV company? Why then is the Minister happy to see a situation whereby another pornographer, Silvio Berlusconi, could be allowed to take over ITV whereas Rupert Murdoch would not be allowed to? Will the Minister not accept that the large penetration of digital television in the United Kingdom has occurred as a direct result of News Corporation and Sky and not of companies such as ITV Digital?

Dr. Howells

I do not accept that the situation is vastly different after the publication of the Bill. Silvio Berlusconi could, of course, have made a bid before now. However, the hon. Gentleman has highlighted a basic anomaly in the existing rules, and it is quite proper to remove the rules that preclude someone who is not from the European Union from owning a television station here.

Mr. Clive Betts (Sheffield, Attercliffe)

I am sure that many in football would like to thank my right hon. Friends for the considerable efforts that they have made to sort out the mess of ITV Digital, but ITV Digital has now collapsed, putting at risk the future of many Football League clubs. Does my hon. Friend agree that there must be something wrong when Carlton and Granada—companies that are, on the one hand, joint owners of ITV Digital and, on the other, making millions of pounds from the so-called digital dividend—can walk away from their obligations to 72 Football League clubs and try to pretend that they have nothing at all to do with the matter? Must we not keep the pressure on those companies and tell them that they have a moral obligation and that football generally expects something to be done?

Dr. Howells

I understand that both parties have hired expensive lawyers. No doubt the matter will become a question for the courts, and in the end the only people who will make money out of it will be very expensive QCs.

Miss Anne McIntosh (Vale of York)

Will the Minister take the opportunity today to assure the House that there will continue to be a viable future for all forms of digital television—terrestrial, cable and satellite—bearing in mind the precarious position in which some of the cable companies find themselves? Will he also clarify precisely the regime that will operate under the new Ofcom, and whether the Office of Fair Trading or Ofcom will be the competition authority? Although the Secretary of State said that the regime will be proprietor-neutral, there will be a reference to the competition authority if a newspaper proprietor expresses interest in owning a share of ITV.

Dr. Howells

Sophisticated and well-tested arrangements already exist between sectoral regulators and the Director General of Fair Trading and the OFT. I hope that they can be replicated and improved under Ofcom—indeed, I have every confidence that they will be. The regulator, Ofcom, will judge competition cases in the first instance, but it will operate alongside and in conjunction with the Director General of Fair Trading, who has responsibility for implementing the terms of the Competition Act 1998.