§ LORD ASKWITH rose to call attention to the proposed Charter of the British Broadcasting Corporation, and to ask His Majesty's Government for information on the subject. The noble Lord said: My Lords, it seems to me, in view of the intense interest that is taken throughout the country in broad-1696 casting, one of the great industries of the future, that everyone would like to know when this Charter is going to be produced and what its contents are likely to be, or some information about it. Any holding it over for any length of time by the governing authority in this great industry is to be deprecated. There are a great many questions that have to be decided. There is, for instance, the question of beam wireless stations. Beam wireless for South Africa, I understand, has been practically completed but the question of rates as between the cable companies and other wireless communications has broken down. I understand that the question of beam wireless with Canada has also been mooted.
§ Further, it is very important to know whether this body will have full Government authority and support in its wave length negotiations and wave band protection in relation both to other British services and to other broadcasters, and also that the service will be protected against demands from the Treasury in regard to anything that it may have over. Then the question of interference is one of a very important character. There has not been for some time, I think, an attempt made on a broad scale to see whether the Continental stations can have a relay programme upon a good basis. That is a matter which only an authority doing bold work without restriction can hope properly to settle. Many other questions there are which I dare say will be touched upon in answer to my Question or in debate, if there be any debate upon this subject. I beg to ask my Question.
§ THE EARL OF LUCANMy Lords, perhaps it would be convenient if I gave a short statement on behalf of the Post Office in reply to my noble friend. The subject of broadcasting is a very wide one and my noble friend has covered a broad field, having wandered as far as Africa. I do not propose to go into any technical details in giving your Lordships information this morning, but shall simply make a short statement covering what is practically the conversion of the British Broadcasting Company into the British Broadcasting Corporation, which is to take place under the Charter that will come into force on January 1 next. I may say that when I was first 1697 approached on the subject I spoke to the Postmaster-General and he welcomed such a discussion taking place in your Lordships' House. The growth of broadcasting, as your Lordships know, has been one of the great romances of scientific invention. Four years ago it was practically only a toy and now, to-day, it is a great power, not only nationally but internationally. It is chiefly for that reason that this change is now taking place.
In that short period—that is in the last four years—the number of listeners has increased so rapidly that at the end of November last there were no fewer than 2,130,000 licences in force. Some measure of State or even international regulation of this new service is essential in order that the various users of the wireless wave bands may be mutually protected from overlapping and from interfering with each other. This control is already exercised by tire. Postmaster-General under the Wireless Telegraphy Acts, 1904–1925, The policy adopted in this country was to allow broadcasting in its infancy to be guided and developed by those having a direct interest in the successful development of the service. Accordingly, the British Broadcasting Company was formed, under Post Office licence, as an association of wireless manufacturers and limited as to profits. If the British Broadcasting Company had limited their consideration merely to the trade aspect of the question, broadcasting in this country would not have achieved the great development which has taken place in the last few years. Fortunately, the men in control exercised a wise vision and set broadcasting upon a plane of high ideals.
I might quote from the Report of the Committee of which the noble Earl, Lord Crawford, was Chairman. I am sorry not to see him in his place this morning. He was Chairman of a very strong Committee that Was appointed and it is upon that Committee's proposals and recommendations that the conditions of the present Charter have been based. This Committee, at the beginning of their Report, make the following remarks in regard to the British Broadcasting Company and their performance in four years:— 1698
Progress has been rapid and noteworthy. And at the outset of our remarks we wish to record our admiration for the work accomplished by the British Broadcasting Company. Formed at a moment when broadcasting was still embryonic—regarded by many as a toy, as a phantasy, even as a joke—the Company by strenuous application to its duties, aided by loyalty of its staff, has raised the service to a degree which reflects high credit on British efficiency anti enterprise.That was the epitaph of that Committee upon the British Broadcasting Company. This Committee was formed to advise as to the proper scope of the broadcasting service and as to the management, control and finance thereof after the expiration of the company's licence. The Committee recommended, generally speaking, that while the Postmaster-General must always remain with the ultimate responsibility, the conduct, the general control and the day-to-day administration of the service should be entrusted to a semi-public body operating as trustees in the national interest.It is in pursuance of this recommendation that the Government decided that the British Broadcasting Corporation should be set up by the grant of a Royal Charter, a draft of which has been submitted to Parliament as Command Paper No. 2756. This Corporation will consist of five governors. The Chairman is to be the noble Earl, Lord Clarendon, and the Vice-Chairman the noble Lord, Lord Gainford. There are three other members whose names are Sir John Nairne, Dr. M. J. Rendall, and Mrs. Snowden, while Mr. J. C. W. Reith, the managing director of the existing company, is to be the chief executive officer. Command Paper No. 2756 also includes a copy of the licence and agreement which the Postmaster-General and the governors-designate of the Corporation have mutually agreed to abide by if the Charter is granted. An agreement has also been made with the British Broadcasting Company which provides that the company shall liquidate itself and transfer its assets, plants and copyrights in January 1 next to the Postmaster-General, free of charge and all encumbrances, in return for certain payments to enable the company to repay at par the subscribed capital, amounting to £71,536.
§ THE EARL OF LUCANTo the Postmaster-General, who will transfer to the new Corporation this sum of £71,000 to repay the subscribed capital at par. There are also further sums, but I am not going into the finance, because although I could give my noble friend the actual details I do not think it is quite within our province to discuss that. The plant and buildings will be re-transferred by the Postmaster-General to the Corporation free of charge. The Charter, as previously mentioned, will embody the appointment of the first governors. They are selected as persons of wide and varied interests and the Postmaster-General and the Prime Minister are confident that in recommending them they have chosen individuals who will carry out the work in the most efficient manner.
The Charter is for a term of ten years and the tenure of office of the governors is for five years, at the end of which time they can be re-elected if they so wish. The Charter is drawn up in the widest possible terms as regards the objects and powers of the Corporation and includes power to acquire copyrights and collect news. The Crawford Committee specially stressed the point that the new authority should not be fettered in its ability to acquire news, but on the other hand it was not to be specially privileged. The Corporation is also empowered to appoint committees and sub-commitees to represent the interests of education, the entertainment industry, music, literature, science, etc. It is understood to be the intention of the Corporation to take over the existing staff of the British Broadcasting Company. The financial clauses of the Charter provide that there shall be established a reserve and sinking fund and they give borrowing powers to the governors up to £500,000. The financial provisions for carrying out the service and for exercise of the powers conferred by the Charter are included in the licence and agreement published as the Command Paper of which I have given your Lordships the number.
During the past two years it has been left to the Postmaster-General to determine what in his opinion was a reasonable expenditure for the Company. By agreement with the governors-designate the licence lays down the broad lines on which their finance can safely be 1700 regulated. In effect, the Corporation are to receive an agreed proportion of the revenue derived from licence fees after deducting 12½ per cent., representing the cost of issuing licences and of enforcing the licensing system, the proportion being fixed on a sliding scale varying with the total number of licences issued. This scale, I may say, goes down as the number of licences increases, because it has been found that the cost of broadcasting does not rise directly in proportion with the increase in the number of licences. The effect of these financial provisions will be approximately as follows: If, as is anticipated, the number of licences on March 31 next amounts to 2,200,000 the Corporation will receive in its first financial year £805,000, and if the number of licences increases by 200,000 during the year thy will receive £866,000 in the following year. The financial arrangements are subject to revision in the light of experience at the end of two years.
Much of the licence and agreement with the Corporation refers to technical provisions, which represent practically no variation from the existing licence under which the company works. The condition that the Corporation must broadcast Government communiqués is not new and will not be used for broadcasting contentious propaganda on behalf of Government Departments. Although the Postmaster-General intends to lay down general rules to prohibit the Corporation from expressing as their own opinion views on matters of public policy and from broadcasting by speech or lecture matters on topics of political, religious or industrial controversy, it is his intention with these exceptions to allow the Corporation the widest possible latitude in the presentation of programmes. The Crawford Committee, in one of their concluding paragraphs, say:
The prestige and status of the Commission should be freely acknowledged and their sense of responsibility emphasised; that, although Parliament must retain the right of ultimate control and the Postmaster-General must be the Parliamentary spokesman on broad questions of policy, the Commissioners should be invested with the maximum of freedom which Parliament is prepared to concede.The Postmaster-General contends that the Charter and licence have been drawn up with the object of giving effect to the Crawford recommendations both in the spirit and the letter.
EARL RUSSELLLords, when the noble. Earl kindly acceded to my request for a debate on this Question, I recognised that that was all that was possible at a late sitting of the Session. The misfortune that we are debating this in so thin a House and at so cold and cheerless an hour of the morning is due to my fault and not his, for I should have approached him earlier on the subject. Still, I am glad that your Lordships are going to have an opportunity for discussion, and I only wish it were a fuller one because it is a subject which does interest very much a large number of people in this country. The first thing one notices in looking at the Command Paper to which the noble Earl who has just sat down has referred is that the Earl of Clarendon is to be the Chairman of the new Corporation. I can say—as I think we all can say—that he enters upon his office with the good will of every member of your Lordships' House.
The noble Earl, in reply to my suggestion that we could not discuss finance, corrected me and reminded me that we are in a position in this House to discuss finance, although we have been rather sharply reminded this morning how very ineffective such discussion may be. I do propose to say one or two words about finance, and there is one point in particular to which I should like to call your Lordships' attention, among the points to which the Earl of Lucan has alluded, and that is the proportion of the licence fees which is going to be put into the pocket of the Postmaster-General. The whole of the money upon which this business is founded and upon which the enormous expenditure involved depends, is the money received from individuals who pay a licence fee of 10s. to the Postmaster-General for the privilege of infringing his monopoly by having receiving sets. That is how it arises. That 10s. is a fee in respect of a broadcasting receiving licence. Out of that money the broadcasting system has been established and built up.
Of course, apart from the financial aspect of the Postmaster-General's monopoly, what these people really pay for is entertainment, and very cheap entertainment at the price, but there was 1702 a complaint last year that the Postmaster-General, who I think originally retained 2s. 6d. of the 10s., retained rather more than that, and did not give the whole proceeds to the existing British Broadcasting Company. Now it is laid down that he is to retain, first, 12½ per cent. for collection. That is one-eighth. I should think it would very amply cover the cost of collection and leave a very handsome profit. Then, when you come to the fourth million licences, he is only to pay them 60 per cent., that is to say, having first retained—I think I am putting it correctly—12½ per cent., he is then to retain 40 per cent. of the balance. I think that this is undesirable from many points of view. It is undesirable because, in my view, it is a very bad method of indirect taxation. It somewhat recalls the sums that were made during the War through controllers' licences. Your Lordships will remember the long discussions that we had about milk licences and the action that was taken.
It is perfectly true that the Postmaster-General, in virtue of his monopoly—a monopoly granted only in the public interests—is able to impose any fee that he thinks proper upon people who infringe that monopoly under licence, but here the fee is imposed for a particular purpose, for the provision of services, and it seems to me that, if any surplus arises—assuming that he is right in the supposition that they do not want more money than is demanded—surely it ought properly to be applied to the reduction of the licence fee and, as a constitutional matter, ought not, to go to the general reduction of taxation. This seems to me to be very analogous to the raid that was recently made upon the Road Fund, where money raised for a particular purpose was seized for general taxation and thereby, by a doubly indirect method, a general tax was imposed in a way not set out in the Taxing Statute as such. I have always felt that this consideration applies not only to this particular provision but to the whole of the Post Office administration, and that the surplus from the Post Office ought to be applied either to the betterment of the service or to the reduction of postal charges, and should not be taken in aid of general Revenue. I have already said that your Lordships 1703 cannot effectively deal with that point, but I think attention ought to be called to it.
There are one or two other points to which I should like to direct your Lordships' attention. The one that seems to me to be next in importance relates specifically to this Corporation. It is the power which is given to them under Clause 3, which sets out their objects. These are, among other things:—
To compile and prepare, print, publish, issue, circulate and distribute, whether gratis or otherwise, such papers, magazines, periodicals, books, circulars and other literary matter as may seem conducive to any of the objects of the Corporation.That sounds rather innocent, like a general clause in a memorandum of association, but by the very virtue of their existence this body has the monopoly of the programmes. That is to say, they, and they only, know what programmes are coming forward, and they have the copyright. They use that monopoly, as your Lordships probably know, to issue a weekly paper called the Radio Times, and that paper has an enormous circulation, not in the least upon its merits, but simply because it is the only paper which contains the official programme. No other paper has the right to publish that information, although, as a matter of fact, it is accorded to other newspapers, and it is published fairly fully in many of them, including The Times. This is a business which is totally different from their other business, and they are so pleased with it and they have drawn such a very large revenue from advertisements—I think they get something like £100,000 a year from advertisements in the Radio Times—that they are now issuing a second paper which, I think, is devoted to foreign programmes.This is a totally different business, and it seems to me that it is very undesirable that it should be embarked upon by this Corporation. It competes with the legitimate Wireless Press, and very bitter complaint was made about this before the Crawford Committee. That Committee—I do not quite know why—turned down that complaint and paid no attention to it, but it seems to me that we are allowing the Corporation to embark upon a very large public business, that of the 1704 publication of books, magazines, circulars and other literary matter. Why that business rather than any other kind of business? There are many other businesses which they might conduct. I think it is rather unfortunate that they should be encouraged to take this course, and I think that the monopoly in these programmes should not be turned to financial account.
With the next clause, which enables them to collect their own news and broadcast it, I am in very great sympathy because, as I ventured to say when I gave evidence before the Crawford Committee, the news bulletin which they are now by their agreement compelled to accept from the newspapers or the telegraphic agencies, and which also they are not allowed to broadcast before a certain hour—they are not allowed to transmit any definite news before seven o'clock—is generally of the most deplorable character and an extremely dull production. Very often it has all the unimportant news in it and very few important things, even the results of by-elections; and I think that if they are allowed to collect their own news and, of course, to transmit it at any time they think fit, that service will be very much improved. Moreover, the result will probably be that they will be able to make a very much more favourable agreement with these distributing agencies for securing the benefit of their services—for, of course, it is not suggested by the Postmaster-General, nor was it suggested by the Crawford Committee, that they should have the right of infringing the copyright of Reuter's or the Exchange Telegraph Company, and it was not suggested by anybody that they should take their news without paying for it.
I notice that any vacancies which arise are to be filled up by the rather cumbersome method of Order in Council, but I suppose that in the case of a company under Royal Charter that is necessary, though I should have thought that the Postmaster-General might have done it. I should like to add a word about the remuneration. I think I am right in saving that the Crawford Committee recommended that the remuneration should be ample. There is, perhaps, no complaint concerning the Chairman and Vice-Chairman, but I notice that the 1705 ordinary members are to have only £700 a year. In a business of this magnitude, which expends something like £800,000 a year, it seems to me that £700 a year is a very modest remuneration when you consider the amount that actually enters a man's pocket after the Exchequer has bad its say. Personally I should have been very glad to see £1,500 a year for the Vice-Chairman and £1,000 a year for the others. I am sorry that His Majesty's Government did not think fit to be a little more generous in that matter.
Turning to the draft licence which is to be given by the Postmaster-General, there are one or two matters to which I should like to call attention. There is a provision which, I am sure, will meet with universal public approval in this country. I need not read it to your Lordships, but, in effect, it amounts to the prohibition of the use of broadcasting facilities for advertising. The Corporation are not to receive money for advertisements, and that condition, I am sure, will meet with general approval.
I do not take any exception to the limitations of their powers as to broadcasting that which the Postmaster-General thinks fit to prohibit or proscribe, because I am quite sure, as all your Lordships will be, that those powers will be exercised in a reasonable manner and for the public good Nor, I think, can any exception be taken to the obligation to broadcast official news when required, when we have so recently in memory the events of the General Strike. I am glad to see that in subsection (7) of Clause 18 there is a provision that after 1929 the Postmaster-General will give consideration to an application for an increase in the amounts payable, but I should like to see the principle accepted that the Post Office shall not recover appreciably more than the reasonable cost of collection of these licences and that the balance, if any, shall go to the improvement of the service or to the reduction of the licence fee.
I may pause here to say that the Postmaster-General might usefully expend some additional money in more actively prosecuting unlicensed receivers. There are still, I am afraid, a very large number of these, and it really is his 1706 public duty to bring them into line. I think a good deal more might be done in that way. Incidentally, I hope that the noble Earl, Lord Clarendon, the new Chairman, will take some steps about this remarkable committee which has been teaching us to pronounce words, and telling us to pronounce them in a way which I think would shock the members of your Lordships' House. I am very glad to have had this opportunity of discussing these matters, late as it is in the Session and difficult as it is to discuss these matters very fully in this House, and I wish the utmost success to this new plan. Obviously it is impossible that so vast an undertaking should go on any longer under private control, and it was only because those in charge did not manage it as a profit-making concern that it went on so well. It is due to the English spirit which makes us refrain from sticking so strictly to the letter of the law.
§ LORD ASKWITHMy Lords, it is interesting to note that the noble Earl on the Front Opposition Bench does not consider that £700 for an ordinary director is sufficient, and I agree as to the balance that it is very important that the Treasury should not raid it. I thank the noble Earl, Lord Lucan, for the clear answer which he gave to my statement, and I will ask him whether he can say if all the Papers are going to be printed as Parliamentary Papers, so that they can be circulated, and whether in this Charter there is sufficient provision made for protecting the prior rights of British broadcasting to scientific inventions made in the future.
§ THE EARL OF LUCANMy Lords, if I may I will answer the noble Earl, Lord Russell, on one matter. As regards his proposal that the surplus should be devoted to the Post Office, and not paid into the Exchequer, that is an old question which has arisen before on other points, and I could not offer him any hope that that will be done. I can only tell him that the agreement between the governors-designate and the Postmaster-General has been discussed between them, and they think that the funds which they are going to have will be sufficient. For the first million they are going to have 90 per cent.—it is calculated rather like 1707 Super-Tax—80 per cent. for the second million, 70 per cent. for the third, and then after the third 60 per cent. They have only just got into the third million now, and it is not likely that they will have got beyond it at the end of two years, when it is all going to be revised. I will make known the noble Earl's objection as regards publishing. With regard to the question of Lord Askwith, these Command Papers have been published for some time now.