§ 4.23 p.m.
§ Debate resumed.
§ Lord Ponsonby of Shulbrede
My Lords, I should like to return to the debate on the Government's White Paper on The Development of Cable Systems and Services. I should first like to thank the noble Viscount the Lord President for introducing this debate in such a robust and forthright manner. Although it was not his maiden speech in this House, it was his first major speech, on which I should like to take this opportunity to congratulate him.
As a generation we are more attuned to the problems and defects of technological innovation than were our predecessors. We have witnessed the development of radio and television from the old accumulator charged battery sets of my youth to the remote control television sets of today with their allied data banks. We have seen the development of the 666 microchip and witnessed computers shrinking in size each year and their price going in the same direction.
Cable television is another innovation before us now whose introduction seems irresistible, but with the rapid pace of technological change I must question whether we are right in rushing into this new revolution without taking full cognisance of future technological developments in this field —developments which we know are already on the horizon. The White Paper has made some welcome progress in anticipating these by prescribing that whatever system cable providers use they should lay it in a star switched manner, as the noble Viscount told your Lordships, to allow for subsequent developments. But, of course, the current proposal in the White Paper is that providers may use either a star switched or a tree-and-branch technology. Inevitably, different providers will use different systems, making the possibility of a national cable network in the longer term more difficult to achieve.
We strongly hold the view that there should be a single cable provider and that this single provider should be British Telecom. If there is a single national provider of the infrastructure of cable, it will be very much easier for the Cable Authority to exercise its control over the services provided. British Telecom is already being asked to hold discussions with individual consortia for the purpose of getting agreement in those geographical areas that British Telecom will provide, and hear the cost of laying the cables to be leased out.
I should have thought that the advantages of a single national provider were obvious. The provider could directly lease his cable for different purposes at different times—to educational authorities, to local sports promoters, to the providers of films and so on. It is notable that in Milton Keynes, which was originally wired with co-axial cable to provide better television reception, only 10 per cent. of households are prepared to pay an extra £10 a month in order to receive the film service which is available on the cable network there.
The White Paper provides that if a cable operator loses his franchise then he shall sell his system to the new operator. Inevitably there will be arguments about what is to be paid for that system by the new operator. As one has heard, in the now traditional world of commercial television these negotiations can sometimes be so tortuous that the new provider of services may decide that it is cheaper in the long run to provide new facilities than to take over old ones. Here, again, it would be much simpler if there were a single provider of the network.
I was glad to see that, as the noble Viscount mentioned, the White Paper offers an inducement to licensees to provide a star switched system by suggesting an initial licence period of 20 years, as opposed to 12 years for tree-and-branch systems. These licence periods are, in any case, far too long, and it would not be necessary to have periods as long as this if there were a single national provider. Indeed, there is a lot to be said for the roles of the cable provider and the cable operator being split.
We welcome the proposed establishment of the Cable Authority. Time will tell whether or not the powers to be given to the Cable Authority are 667 sufficient, and we shall know that only after it has been in operation for a time. One hopes that the proposed Cable Authority will involve itself very closely in establishing the sort of franchise operator desired in a particular neighbourhood. One hopes that it will carry out the same sort of public consultation which is carried out now by the IBA. One would think that before any decisions are taken about the award of franchises there should be a period during which the implications of the franchise bid, or bids, can be discussed in the communities concerned.
The White Paper makes provision for the successful franchise bid to be published. It is, however, equally important that all competing bids are published before the franchise is awarded, so that competing bids can be evaluated by individual communities. Publication should be at least three months before a decision is taken, so as to enable local discussion and representations to take place. It should be recalled that areas in which cable operators are likely to operate are in many cases no smaller than areas in which independent local radio operates. Therefore, the criteria of consultation adopted there could well be used for cable.
In the debate on this matter in another place the role of the consumer was not considered to a very great extent. Cable will first of all bring to the consumer a greatly increased choice of entertainment. It will bring to the consumer access to data banks and up-to-date information. It will enable the use of home banking, direct shopping and other interactive services. It will also provide the possibility of a very local network for use by local communities.
In determining the area of a franchise the Cable Authority should be able to direct an operator to include and provide a service to communities outside the most immediately profitable area. Although, according to the White Paper, the authority will not be required to seek to extend cabling to whole areas which would be uneconomic, they should at least be able to ensure that the areas which are served by a particular cable system are as comprehensive as possible.
Cable will be, to a large measure, dependent on advertising. I think we must all be aware that there is a considerable limitation on the amount of advertising available. The noble Viscount has explained the limitation which will be imposed upon the amount of advertising which may be carried, but there is also a limitation on the amount of advertising which is available. There must be concern that there will be insufficient advertising revenue to go round, the effect of which will be further to undermine the advertising revenues available for the existing television channels and, indeed, for existing local newspapers.
The White Paper says that cable investment should be privately financed and market led. I do not necessarily believe that it will be the bonanza that commercial television was in the early years. The attraction and the cost to the viewer of additional channels when he already has access to four channels and access to a video lending library may not be all that great. Indeed, the noble Viscount, in moving that we take note of this White Paper, raised a large question mark about what the speed of development 668 would be and hinted that it could take a considerable period of time.
I do not intend to dwell on the question of content; that will largely be dealt with by my noble friend Lord Willis. But let me say that we welcome the improvements which have been made since the publication of the Hunt Report. We shall press for further improvements as the Bill goes through the House. Indeed, we noted with great interest the closing remarks of the noble Viscount, that the Bill is to be introduced in this House and not in another place. We agree with him that in this matter we in this House have a remarkable expertise.
§ 4.35 p.m.
My Lords. I have already had the pleasure and. indeed, the privilege of questioning the noble Viscount the Leader of the House, but perhaps I should say that I regard it as a particular honour as well as a pleasure to follow the noble Viscount in a debate upon a subject in which he is obviously an expert and in which he has already played such a major part. Your Lordships are well aware of the efforts of the noble Viscount in another place to make absolutely sure that the introduction of this new system—a cable network, which most of us favour—will not be at the cost of some damage to the standards of public service broadcasting, a matter which was referred to very dramatically by the noble Lord, Lord Hill of Luton, in an earlier debate in your Lordships' House. Your Lordships will be very grateful to the noble Viscount for the efforts he has already made in that direction, and we are very glad to support him now that he is here with us.
I listened with interest to the noble Lord, Lord Ponsonby of Shulbrede, and I was somewhat reassured by what he had to say. While he has anxieties and reservations (indeed, who does not?) it seemed at the end of the day that he and the party which he represents in your Lordships' House are perhaps in favour of the long-term aim of the initiative which we are now discussing. It is interesting to note that when this matter was discussed in another place on 30th June the Motion then before the other place, standing in the name of the noble Viscount's right honourable friend, was as follows:That this House approves the White Paper on the Development of Cable Systems and Services (Cmnd. 8866)".At the end of the debate I was astonished to find that the Labour Party in another place apparently disapproved, because they voted against the Motion. That seemed to me to be rather surprising, bearing in mind the immense benefits to the economy of our nation and the new jobs which this development could bring to areas in desperate need of jobs. I was not surprised that the Labour Party expressed anxieties and doubts; that is right and proper. However, I was surprised that they voted against the Motion.
Today we have a Motion standing in the name of the noble Viscount the Lord President of the Council:That this House takes note of the White Paper on the development of cable systems and services (Cmnd. 8866)".I wonder why we are not being asked to approve it. My noble friends on these Benches would have liked to approve it. Then we might have seen whether or not 669 the noble Lords in the so-called official Opposition in your Lordships' House would on this occasion have approved or disapproved. But it seemed to me that, in general, the noble Lord, Lord Ponsonby of Shulbrede, approved.
§ Lord Ponsonby of Shulbrede
My Lords, may I remind the noble Lord that there is only one official Opposition in this House?
My Lords, I am glad to be reminded by the noble Lord. All I can say to him, as somebody else once said, is: we must wait and see. As I am quite sure the noble Viscount knows, we on these Benches have always supported the introduction of cable. The noble Viscount followed our activities with great interest before he arrived here. We support cable, in the main because we believe in the immense advantages to our nation of the interactive services which might in the end be derived from it—services which could be of immense benefit to our nation by providing jobs and assisting the economy.
However, it is perhaps a little unfortunate that in the areas where there is a desperate need for jobs—for instance, in Liverpool and on Merseyside—we may find that when new industries which are based on new technology, particularly on technology of the kind which is dealt with in this White Paper, go there, not many months elapse before there is a manpower shortage: a manpower shortage because, tragically, the young people who are now out of work in that area have not been trained at primary or secondary school, or anywhere else, in the skills which will be needed in those new industries—but that is another matter.
We supported the cable system on the basis of the long-term advantages, but we were already aware—as were other noble Lords—that this great initiative was to be brought in on the back of an entertainment service. We also understood that there was a threat to the standard of public service broadcasting. We were prepared to face that danger; but I am bound to say that I believe we now have to look at those dangers with even more care because, as has been said already, times have changed.
We have already seen that sources of advertisement income are not limitless; we have seen what happened to TV-am, although perhaps that is not a strict parallel and other factors were involved there. After all, we have 4 million people unemployed and 7 million retired—in other words, around 11 million people who do not have to get up in the morning. It is not actually against the law to stay in bed, but when people do get up in the morning most of them have something to do. They have to go to college or to work. When they switch on the television, as soon as an advertisement appears they switch over to the other side. So perhaps the evidence from TV-am is not really relevant.
But we have seen the difficulties which Channel 4 has been in, although many of us would like to say how much we think the programmes on Channel 4 have improved. In particular, I believe that some of them improved as a resut of the efforts made by the existing independent programme contractors in assisting Channel 4 with programme making. That leads me on to say that I hope we shall be making proper use of 670 independent programme contractors in the initiative upon which we are now embarking.
I should like to speak mainly about that initiative. Like other noble Lords who have an interest in this subject, I have received papers from all kinds of bodies: the National Consumers' Council, the Consumers' Association, IBA, BBC, and so on. I have read them all with great interest and have learnt a lot. However, I hope that the people who sent me those papers will forgive me if I do not refer to those points today, because they can be dealt with when we come to the legislation at a later stage. I will merely say, in regard to the BBC's points, that I share their view of the importance of the so-called "must carry" provision, to ensure that people who would have difficulty in picking up direct broadcasting by satellite because they already depend on urban community reception schemes will not be deprived of the full range of choice available. With that goes my belief that it is very important to cherish and protect the development of direct broadcasting by satellite—to which we refer as DBS.
If the existing TV programme contractors are to play an important part in this venture, I believe that the Government need to look again at three points in the White Paper. The first of these is that the ITV companies should not be cable franchise holders for all or part of their existing ITV franchise areas. Secondly, that pay-per-view and sponsored programmes should not be permitted to interim licence holders until the new Cable Authority is set up and assumes control. The third is the White Paper's proposal on the number of homes to be served by any one interim licence holder. I will return to those three points in a moment. I will first say a few words about the financial prospects of cable, which are very much related to those three points.
It is now generally accepted that cable is not going to be "a licence to print money". What we do not yet know is whether cable will be sufficiently attractive to investors to encourage them to risk sums substantial enough to meet the very considerable cost which cabling Britain will require. As the Government are intending to denationalise British Telecom in the very near future, the cabling of Britain will have to be financed entirely by the private sector. Estimated costs vary, but the sum required to cable the country is likely to be between £3½ billion and £4 billion.
The White Paper's decision to allow 10 or 12 interim licences to be granted before the setting up of the Cable Authority is surely designed to get cable off the ground quickly, and that aim calls for as many aids to a fast return on investment as possible—partly to encourage investors, and partly to provide profits to fund continuing expansion in the field of cable development, once the enabling legislation has been carried through. But even under the most sympathetic regulations, cable investors will have to wait a long time to get their money back—and even longer to see a profit. Experts in the City doubt that return on cable will be seen for at least seven years, maybe not until after 10 years. This pessimism is borne out by the North American experience.
Without allowing such incentives as pay-per-view and programme sponsorship to interim licence holders, either potential investors will be deterred or 671 those investors who do enter the fray may soon find themselves in a financial position which lacks liquidity. Thus, the Government may have thwarted their own intentions. Another aim of granting interim licences should surely be to test the market; to find out what the public are prepared to pay for and how much they are prepared to pay for it. Many interested parties and potential investors—the ITV companies among them—will be watching the fortunes of the interim licence holders closely, to learn from their experience and so form a judgment on the role they wish to play in cable development.
The interim period could be regarded as experimental: what is the use of an experiment if all the contributing factors are not tested? In other words, it is ridiculous not to use the interim period to test the market for sponsored programmes as well as basic subscription and interactive services. The Government are wrong to lay all the stress on testing the technology involved in cable; financial considerations should also be taken into account.
Even when the Cable Authority has been set up and pay-per-view and sponsored programmes are allowed, it is clear that the problem for the Government will lie not in the selection of applicants for cable franchise but rather in finding enough applicants with sufficient capital available to fund this massive project. Against that background, it is surely clear that the Government should do all in their power to encourage investors to come forward and should be wary of excluding or limiting potential investors, including the ITV companies, unless there are the clearest possible grounds for disqualifying them from entering the market in the way they themselves find most appropriate.
Let me return briefly to the three points to which I referred earlier, and which I hope the Government will look at again. First, there is the question of the ITV companies' participation in their own ITV franchise areas. The White Paper has said that the Government believe it will be undesirable for a company that holds the ITV franchise for a particular area also to be the cable franchise holder for part or all of the same area. It gives the reasons for this belief as being,in the interests of encouraging diversity",the prevention of,a concentration of powerin a particular area, and the need to secure,a diversity of ownership of cable operations in the country as a whole".In other words, it fears monopolies.
So far as the fear of monopolies is concerned, surely the Government need have no worries with regard to the possible participation of ITV companies. The ITV network structure consists of 15 totally separate and independent companies, and while these 15 companies may have certain obvious common interests, and of necessity work closely together, in terms of financial ownership and company structure they are each completely autonomous. When considering whether or not ITV companies should be allowed to operate cable franchises within their own areas, it is important to take into account the well-developed relationship with and knowledge of their 672 regions which the companies have established since their conception. This should be a highly relevant factor in determining their suitability to operate a local cable franchise.
It is said that one of the aspirations of cable television is to provide more and better community programming. Who better to help and advise in this field than the regional ITV company? An ITV company granted a cable franchise in its own area would not itself produce all the programme content provided by cable. On the contrary, the amount of programming required will (and should) come from many different sources. Nor would the ITV company be the sole arbiter of what appeared on the screen, since the cost of setting up and operating a cable franchise would almost certainly necessitate an ITV company participating only as part of a consortium. In this role, as a member of a cable consortium with informed and intimate knowledge of the area being served, an ITV company could serve a uniquely useful purpose in contributing the vital expertise and experience which will be required in order to provide a successful local programming service.
Furthermore, it is important to remember that no ITV company could hope to operate all the cable franchises within its region. The cost of cabling 100,000 homes has been estimated at between £141 million and £15 million—perhaps £8 million more if the operator wants to have absolute control of the cabling ducts and does not use existing ducts. No ITV company would have the financial resources available to bid, even as a member of a consortium, for more than a small proportion of the cable franchises within its own area. British Telecom has been allowed, within the framework provided by the White Paper, to participate very fully in the developemnt of a British cable network, and rightly. It has earned the right, by virtue of its high calibre of expertise in its own field. Surely ITV companies have equally earned the right to participate freely in a rapidly expanding and changing industry.
At a time when the Independent Television companies are being challenged by revolutionary technology, cable, satellite and the rest, they should be given the opportunity to compete and participate as competitively and as effectively as possible and in a way which is socially beneficial. We are not going to have Anglia seeking a cable franchise in Cornwall or Granada in Kent. The object is to allow them to work to a limited extent in their own areas.
May I say a brief word—I know 6I am speaking for too long—about the pay-per-view and programme sponsorship in the interim period. The White Paper proposes that,pay-per-view will not be permitted until the Cable Authority is set up and assumes control",and thatno sponsored programmes will be allowed in the interim period outside the guidelines currently operated by the IBA".The reason given is that neither service should be allowed to operate without being.conditioned by the exercise of the Cable Authority's judgment".Is that a persuasive argument? The granting of interim licences before the Cable Authority has been set up will obviously necessitate many decisions being made 673 before the new authority is in a position to have a voice. The White Paper gives no clear reason for excluding pay-per-view and programme sponsorship in the interim period. By preventing the interim licence holders from offering pay-per-view and sponsored programmes the Government are denying them the quickest and easiest ways of generating early revenues at a time when their capital costs will be highest. The effect of the ban will be to restrict the range of choice available to cable subscribers. The task of meeting specialist tastes and requirements will be made more difficult, and in some cases impossible. In other words, the wider the availability of pay-per-view the greater the variety of programming provided on cable will be.
I will just mention the last of the three points very briefly: the size of the area to be covered by interim licence holders. The White Paper proposes that this should be limited to an area of not more than 100,000 homes. A report published by National Economic Research Associates entitled, Can Cable be Profitable? suggested that franchises of around 150,000 homes are too small to give a rate of return attractive to private capital. The most a franchise of 100,00 homes can expect is 50,000 customers, which is not an economic proposition.
I have gone on about that, and I want to make it clear; I have been connected with broadcasting for many years; I have worked for BBC.1 and BBC.2. I mention that to show that I am "respectable". In addition, I have written and presented programmes for each and every one of the individual programme contractors, but I have no interest to declare in any of them, save that I believe that they have immense expertise which we could mobilise and use in order to make this transitional period effective and make it work. I very much fear that there are things in the White Paper at the moment which might perhaps obstruct that happening, and I hope the Government will look again at the three points I have raised.
May I say finally that I will presently have to absent myself very briefly from your Lordships' House for another public engagement connected with the business of your Lordships' House. I will return as rapidly as possible, and miss any speeches made by my noble friends no discourtesy is intended and I assure them that I will read their words with the greatest possible care. We will give all the support we can to these developments over the coming time. We shall want to ventilate some anxieties, of course, when the legislation comes forward.
§ 4.54 p.m.
The Lord Bishop of Wakefield
My Lords, I want to express my general support for the main thrust of the Government's proposals in the White Paper, and for the way the Government have responded to some of the anxieties expressed in the debates last autumn following publication of the Hunt Committee Report, in particular over how long public service broadcasting of its present quality could co-exist with entertainment-led cable television. So, for my part, I very much welcome the Government's recognition that they have a responsibility,to see that in allowing new facilities to be provided to some it does not sanction the impoverishment of existing services which are available to all".674 I think we all recognise that it is going to take time before the cable services can be provided. There are indeed some estimates that in the end only 60 per cent. of homes will receive them. It therefore is essential that the 99 per cent. of people who receive the existing BBC and ITV services should not be left in a worse position through the only partial expansion of cable.
The White Paper shows that the Government have taken account of the many fears about the likely impact of cable on the quality of public service broadcasting, and I am glad that it so generously recognises the achievements of public service broadcasting. I think it correctly identifies the challenge before us as finding ways of preserving the benefits which the present system gives us while at the same time giving cable and DBS the freedom they will need to fulfil their potential in what has been called "the third age of broadcasting".
I therefore welcome the safeguards in the White Paper about the televising of the great national and sporting events so that they will continue to be available to all through the BBC and ITV. I think it is a wise provision that the Home Secretary should have reserve power to determine the list of protected events.
One of the significant developments following the birth of Channel 4 is the fact that there are independent British producers and companies creating good programmes on that new channel. Sources of supply, though small, are here. And while it is arguable whether a quota should be imposed on low-cost foreign imports, it is certainly very desirable that those who seek a franchise should indicate what proportion of British and European Community production material they will be offering in their programmes. I therefore very much welcome the fact that in the White Paper the Government are going further forward in the encouragement of British producers than the Hunt Report originally did.
Obviously in the development of cable television the role of the Cable Authority will be crucially important. The Government followed the Hunt Committee's approach that once franchises are granted the authority should regulate with a light touch and adopt a reactive rather than a proactive style. I welcome the assurances in the White Paper about the authority's monitoring role, the importance of its keeping in touch with operators so that the public interest is served and promises made are promises kept. The responsibility for programme standards of taste and decency will rest with the operators. I am sure it is right that they should be bound by the same obligations as the public service broadcasters. The Cable Authority will need to supervise this, give guidance in sensitive areas and make recommendations about the timing of controversial programmes. So I welcome the sanctions that the authority will have in particular cases, maybe preventing certain programmes from being shown. Also the authority will have reserve powers in that they could bring a particular franchise to an end if the operators abused the conditions under which it was granted.
I think the Government have rightly reflected the concern that many people now have about the increase of violence and pornography in our society and its expression through so many outlets. I am sure 675 that many in the House this afternoon were glad to hear the noble Viscount the Lord President quote the White Paper in stating that so-called "adult channels" have no place in the sort of cable systems the Government wish to see developed.
I am pleased, too, that the Government are looking into the position of the Obscene Publications Act and its possible application to cable. This is important because the Cable Authority will not exercise the detailed control over programmes which the BBC and the IBA do. As we know, there are those in our society who believe that the controls which the public service broadcasting authorities now exercise are not always fully adequate.
The role of the Cable Authority in granting franchises, in monitoring operations and forwarding the development of interactive services is fundamental. Surely it is very important that great care should be exercised in the choice of the channel and the part-time members of the authority to ensure that they are people of wisdom, foresight and standing who will command the respect of the general public as well as possessing the necessary kinds of expertise to oversee the development of cable.
I turn now to the ownership of cable systems. In paragraph 61 the Government propose to exclude from any stake in the ownership of a system any organisation which appears to be of a directly political or religious character and any individual who would seek to use his position in order to favour a particular political or religious cause. In its submission to the Hunt inquiry, the Central Religious Advisory Committee to the BBC and the IBA—known as CRAC—of which I am the chairman, thought it undesirable that any cable company should be the exclusive property of any one political party, religious group or foreign interest. But we did put forward the belief that the control of a limited proportion of a cable company might be permitted. I note that the British Council of Churches' paper on cable television went further than that. It argued that because a cable company would be in a monopoly position it was right to exclude religious and political groups from ownership of complete cable systems. But the General Synod of the Church of England last February accepted an amendment, admittedly by a small majority, calling for the participation of churches and other religious bodies in the ownership of cable operating companies.
I noted last week that in his speech in another place the Home Secretary said that the restrictions which the Government propose on ownership were designed to avoid political or religious domination of local systems. However, the question I ask the Lord President of the Council is this: would this perhaps. allow churches and religious groups some measure of involvement in ownership, though not an exclusive or dominating role?
I believe that in one or two of the independent local radio companies the churches have a minority holding, and that might be a useful parallel to examine. I am, of course, aware of the very real difficulties in this area, particularly the existence of small and unrepresentative groups with very high 676 motivation which are able to raise large sums of money and which have a desire to secure channels for their exclusive use. It would seem that the issue here turns on partial influence in ownership which might be constructive and healthy or exclusive ideological control which would certainly be neither.
For my own part, I think that what matters principally is that churches should become involved in the programmes. So I hope that in the granting of franchises the Cable Authority will consider local views and encourage their expression and that the authority will also follow the IBA practice of making publicly available all the franchise applications they receive. I trust that churches and educational bodies and community groupings will make their wishes and views known to those seeking franchises so that due account will be taken. I hope, too, that churches will take a due part in local access and community programmes. I also hope that Christian producers and programme-making bodies will offer programmes of acceptable standard with a committed quality which is respectful of the audience that will find their way into the schedules and packages of the programme operators. In this way there could be a Christian involvement which would enrich the general output.
I am glad that in paragraph 139 of the White Paper there is an indication of a greater scope for religiously committed material in cable television and that the Government foresee the creation of channels devoted to political or religious matters provided that a variety of views is expressed allowing for widespread access and avoiding a narrow sectional control by any political or religious group. I am sure that this is the right approach. I also welcome the recognition in the White Paper of the value of broadly representative religious advisory committees.
Little over a year has passed since the setting up of the Hunt inquiry and nine months since that committee reported. The Government have worked very fast, but I think the White Paper's proposals show that they have taken fair account of much of the debate that has so far taken place. I therefore welcome the main thrust of the White Paper's proposals.
§ 5.6 p.m.
§ Lord Nugent of Guildford
My Lords. I am very glad to follow the right reverend Prelate in this short debate and to say that I sympathise with his plea for the churches to be allowed to be involved. It would certainly be a mistake to have a dominating party in any particular group. It seems to me obvious that the Christian Church, which has been the inspiration of our country for 1,500 years. should be allowed to have some part of this very important medium. I feel sure that my noble friend the Leader of the House will be sympathetic to that view.
As I think I am the first speaker on the Government side in this debate following the speech of the Leader of the House, may I congratulate my noble friend on his lucid and helpful introduction of the White Paper and congratulate him on the White Paper itself. I am sure that the Government are right to proceed with all speed with the development of cable TV. There are big prizes to be won in the advanced technology of 677 communication and the sooner that development takes place the sooner will our country benefit from those prizes.
The Government are to be congratulated in every way on proceeding with it. The capital outlay is formidable and, as other speakers have already said, the financial prizes to be realised are likely to be further off than some may think. Certainly this is no financial bonanza, as the noble Lord, Lord Ponsonby of Shulbrede, said. Therefore, quite obviously it has to be a development for private enterprise and market led, as my noble friend said. Great risks are involved, and there is no doubt about that.
Fortunately there seem to be powerful groups who are already anxious to begin. There has already been one very important group in this country making investigations in my local town of Guildford. Indeed, I was invited to take a leading part with the group of local people who were to join in. However, because I wished to take part in these debates—in some respects, perhaps, not always as uncritically as my noble friend would expect—I felt that I should resist this temptation. In any case, I was not absolutely sure that I would still be on this earth in order to see the benefits of it. I wish them well and I am delighted that these people, who have some experience of these matters, feel that there are such good prospects. I am sure that my noble friend is right in what he is doing. I wish the Government, and all those who take part, well in this tremendous enterprise.
My noble friend referred, very helpfully, to the safeguards that are needed and he declared his own convictions in the matter and his own record, on which we all congratulate him. I particularly welcome the improved safeguards which appear in the White Paper which were not in the Hunt Report, particularly the safeguards for the existing national corporations—the BBC and ITV—and for standards of taste and decency. I do not propose to make a comment on the first point, because I see that my noble friend Lord Hill of Luton is poised ready to discharge a broadside shortly, and I do not doubt that that particular aspect of the debate will be very well catered for.
I wish to make only a few comments on the safeguards for taste and decency. As I say, I thank my noble friend for listening to the comments that were made in the debates on the Hunt Report and for the considerable advance that has been made in the proposals in the White Paper. The proposals are that the Cable Authority should have the same responsibilities for programme content as have the BBC and the IBA, and that programmes are to be subject to the Obscene Publications Acts. Well, this is something.
But I follow the point made by the right reverend Prelate—of which noble Lords in this House will be well aware—that on many occasions we have expressed our anxiety about the deteriorating standards in the television programmes that we now see on both the BBC and ITV. There is more violence, more pornography, and more bad language than there ever was 20 years ago, when there was none, or 10 years ago, when there was some. It seems steadily to increase, and our anxiety is to try to see it checked, not 678 increased. So we cannot regard that particular obligation being placed on the Cable Authority as providing an assurance that we shall not be affronted and offended by an even greater flow of this kind of material, which many people find objectionable in the family circle.
As my noble friend Lord Whitelaw will well know from the many occasions when I have importuned him on the matter, we have some strong feelings about it. Invariably during my noble friend's previous existence as Home Secretary there was the response that it would be inappropriate for the Home Secretary to take any direct action with the corporation or the authority, and that it is up to them to discharge their responsibilities themselves, though of course their attention has been called to what we have said. I accept the necessity for these bodies to proceed to use their best judgment, and I quite understand that there is a whole range of problems with which they have to deal—artistic, commercial, and so on. I do not doubt that we shall be hearing more about that aspect before this debate is over.
I turn now to the question of the application of the Obscene Publications Acts: but I just make the point that the Cable Authority will be even less able to exert influence on programme producers when they come from all over the place than the BBC and the IBA are able to do at present. With regard to the application of the Obscene Publications Acts, my noble friends will be all too familiar with the debates that we have had here on many occasions calling attention to the ineffectiveness of the main Act, the 1959 Act. The fact is that the Act has had so many holes punched in it that the Director of Public Prosecutions is now unwilling to approve a prosecution taking place, even in the most flagrant instance, because he cannot be certain that there would be a conviction. The Act really is a broken reed.
I refer in particular to my own Private Member's Bill of last year, which redefined and strengthened the law in this field. As noble Lords will remember, it received a very substantial measure of support on all sides of the House. Unfortunately, when I represented it to my noble friend in his previous existence as Home Secretary, he explained to me his difficulty in handling it in the House of Commons. Indeed, I recall his actual words, since they were particularly graphic. He said, "My dear chap, if I took this into the Commons, I couldn't tell whether I would be able to bring it out again, and, if I did, what shape it would have".
Of course, I understand the great difficulties of handling these issues involving conflicts over standards of taste and decency, on the one hand, and the liberty of the subject, on the other. Nevertheless, I roundly make the point that the Obscene Publications Act 1959 is a broken reed and cannot be regarded as an effective safeguard for the standards that all of us believe should be maintained.
It is against that background that I say to my noble friend—I do not wish to be ungenerous, because I realise that the White Paper has made a considerable advance—that I feel that more is needed. It is in that spirit that I would say to him that I hope he will look very carefully at this aspect of the matter when he is drafting the proposed Bill. I realise that it will be an 679 extremely difficult Bill to draft, but my noble friend was very generous in saying that he would listen to everything that we said here today.
I say to him that I am quite certain that not only I, but many other noble Lords, will wish to see the Bill actually contain sufficient safeguards for maintaining standards of decency. If the safeguards are not included in the Bill, my noble friends and I will wish to move amendments to include them in it, and I do not doubt that in trying to do so we should receive a substantial measure of support. With those words, I say to my noble friend that I congratulate him on the speed and efficiency with which he has acted, and I wish him well with this major development.
§ 5.17 p.m.
§ Lord Somers
My Lords, I fear that I am going to be the only dissentient voice this evening, and it makes me particularly sad to be so when it is in a debate on a Motion of the noble Viscount the Lord President. May I say in parenthesis how very proud we all are to have him here as our Leader. He has now occupied a high position in public life long enough for us all to know how very high are his standards, and it is a great privilege to have him with us. I do not want to see television enlarged. I feel that we have too much of it already, and I shall try to explain a little why I feel this.
Television is an excellent thing to a limited degree, but unfortunately we have not got it to a limited degree; we have it practically unlimited. We have two programmes to choose from—three, actually—from a very early hour in the day. We are rapidly becoming a nation whose minds are made up for us, rather than a nation who think for themselves. I notice increasingly among young people how their opinions, their ideas on life, their likes and their dislikes, all seem to come from something or other that they have seen on television. rather than being genuinely their own ideas.
I think it is a great pity for us to have lost our power of thinking; and such a trend will continue. If there is a television set in the house one cannot prevent young people from looking at it. Much material that comes over the television is of good quality, but a great deal is anything but. At the moment we have some forms of entertainment that are extremely good, very amusing, and I should like to see them stay. But we have others that are vulgar to the extreme, sensatational, and are not at all the kind of things on which we would want our young people to be brought up.
I was very glad to hear from the noble Viscount the assurances that sex and violence are to be eliminated so far as possible—but of course the important phrase is "so far as possible"; that does not mean that they will be eliminated entirely. If one buys a film from overseas—in particular an American film, may I say—it is fairly certain to include a scene showing someone firing a gun. Most of the interest in it is of a slightly sexual variety. It is a great pity that that kind of thing appears so much on the screens. I am not a puritan. I see the noble Lord, Lord Lyell, looking rather surprised, but I am not. I enjoy quite a lot of good, clean entertainment. I do not enjoy the other kind.
680 I agree entirely with what the right reverend Prelate said about the Christian churches joining together to produce something that is of Christian interest. That has been almost eliminated from television nowadays. Have we forgotten that we are or, shall I say, that we are on paper, a Christian nation? Christianity is not necessarily sectarian. That might be remembered when programme designers start work in cable television. I realise that one dissentient voice—a very insignificant one at that—in your Lordships' House will not stop the Bill from going through. I am glad to hear that there will be safeguards. I only hope they will work.
§ 5.21 p.m.
§ Lord Jenkins of Putney
My Lords. I am glad to follow the noble Lord. Lord Somers. I can bring him the comfort of assuring him that he is not alone in his objection or dislike of this White Paper. I object strongly to it myself, but for somewhat different reasons to those enunciated so clearly by the noble Lord.
The noble Viscount, Lord Whitelaw, spoke of the necessity of maintaining standards. I believe that the White Paper is a recipe for lowering standards. There is no way out of it. My general view of the White Paper is that what it proposes is premature and undesirable and that it should not be followed by legislation. In the other place the Opposition voted against the White Paper. I wish that we were doing the same. I understand that the Bill is to be considered in this Chamber first. As the measure will not have gained the consent of the other place, and will indeed have been opposed in principle in respect of the White Paper. I take it that we would be entirely in order in voting against the Second Reading. I wish to give the House one or two reasons why we should do just that.
The Commons opposition seems to have been very soundly based. As my right honourable friend Mr. Orme remarked, if the whole thing was deferred until 1986, it could be based on fibre optics with an advanced system, which should of course be nationally owned. As it is, what the Government propose seems likely to be the biggest flopperoo since breakfast television. The only consolation is that it will be private money that will be lost. Indeed, I would recommend any entrepreneur who wishes to lose a few thousand or million pounds to put it into cable. The money will most certainly go down the drain. If someone wants a good tax loss, this might be a way to acquire one. That would not matter, but the use of commercial cable for what is essentially a salesmanship operation and an inferior entertainment operation, regurgitated, as it will be, from the United States, will drive out the possible social uses of cable. The proper proportion proposal in the White Paper will most certainly not stop it.
I hope that when we see the Bill—I suppose that we are going to see one—it will not content itself with proper proportion but will lay down precisely what that proportion should be. This will be the only way to ensure that it is enforced. I would suggest a proportion of American material not exceeding 14 per cent. That should be the sort of figure.
The advent of cable may well be noted as the point of decline of British television that hitherto has had a 681 good record inside our own country and throughout the world. With families being urged to pay £120 a year or more for the use of cable, it will become even more difficult politically to seek a higher licence fee. Indeed, the licence system may well have to go, and the BBC will have to accept an inadequate grant out of ordinary public revenue. I believe that this is almost certain to be one of the consequences of the increased family expenditure on television that the advent of cable will bring to those who adopt it.
Equally clearly, the independent television companies will find it impossible to maintain their advertising revenues, and consequently the standards of their programmes will also decline. So cable will not only introduce a new low in television standards itself, but it will drag down the levels of existing broadcasters. As it flops and fails, in desperation to rescue some part of their investment, entrepreneurs will be driven to trying to capture some of the market at present held by the cinema, the reputable cinema and the disreputable cinema. They will be driven to try and take away programmes from BBC and ITV. They will be driven to capture advertising by any means they can. We are opening a position in which broadcasters will find themselves forced to take actions that will not only deprive the public of the kind of standard that at present exists in television but will render it very difficult to recover those standards ever again.
The lesson of breakfast television is that there is no new market. Saturation has been reached. All you can do now is to try to take away some part of the total viewing eyeballs from your competitors by hook or by crook. The licence to print money has vanished. It is now only a franchise to go fishing in a pond where a growing number of lines are having to share a declining number of fish. It is not really a prospect that I find particularly enticing. There will come a time, in a year or two, when we may be able to look at cable in the same way as we now look at the sewers—as part of the furniture of a modem society, provided automatically for the convenience of people. When we can do that, then will be the time to go ahead, but not now as a means of searching for a non-existent profit. The money will simply not be there.
The Government would therefore do well to defer their proposed legislation following this White Paper, at least for the time being. The Bill might well be introduced, I suggest, right at the end of the present Session of Parliament so that it can be allowed to fall. A different Bill could be introduced in a new Parliament because the technicalities would be more advanced and we could go straight into the fibre optics situation, instead of having to provide the possibility of some part of that, some part of something else, alternative measures and so on. Fibre optics are coming within a year or two. Therefore, it would be very wise to defer the introduction of the legislation. Indeed, it would be wise from all points of view—wise from the point of view of waiting for the technicalities to get right, wise too from the point of view of waiting for a time when more money is available, so that there is more advertising to go round and a greater degree of prosperity generally in the country. In that way cable would have some chance of getting off the ground 682 without having to draw everything from the existing organisations. We might then be able to look at cable with the national interest in mind rather than entering upon what may well prove to be a "communications bubble", delivering nothing more than a general collapse of standards.
This may be yet another of those developments which are carried out not because they are of any general benefit, but simply because they are technically possible. Brabazon was one such enterprise, an aircraft which is only a memory; Concorde was another. Between them they have destroyed the British aerospace industry which should have been making less fascinating but more saleable aircraft and which would not be in its present situation if it had done that instead of putting all its eggs in the Concorde basket. There is also the question of Trident and cruise missiles. We are to have them, not because they increase our safety, but because they are more advanced. Together they will destroy us.
We have not learned the lesson that we have reached the position, technically, where we must not do things because they can be done. We have arrived at the point in our technical expertise where we must recognise that there are some things which can be done but which ought not to be done—indeed, which must not be done. This is a small example of that general tendency, but it is quite an important example because there is basically no necessity for it at all. It is yet another project which, in a world in which every year more and more people are dying of starvation, is a ludicrous irrelevance.
The White Paper ought to go on the shelf. It ought to stay there at least until 1986 when it might be brought down, dusted and re-written, although it really would not matter very much if it was forgotten altogether. I much regret the Government's decision to act in advance of parliamentary decision. For that reason alone I regret that we are not dividing against the White Paper tonight. If it comes before us I hope that it will provide us all with an added reason to look very carefully at the legislation and to consider very carefully whether we ought to allow it to pass even the Second Reading stage in this House.
In case I have seemed over-protective on behalf of the BBC and indeed ITV, let me say that the threatened advent of cable emphasises how wrong it is for the two existing authorities to be allowed to prevent the advance publication of their programmes except, of course, in their own "house organs", the Radio Times and the TV Times. In the United States and in many other countries, there are weekly guides giving all the programmes. That has proved to be legally impossible in this country and I think it is very wrong and very much against the public interest that it should continue to be so. If cable does come along, not only will it be against the public interest but it will be completely absurd that no single weekly publication would be capable of publishing, without breaking the law, a summary of all the available programmes. At the moment that cannot be done and it is a considerable public inconvenience and causes many of us to spend 52p a week buying two weekly jounals when we ought to be able to buy a single paper which will give us a reasonable summary of what is available over the 683 whole sphere: radio, television, local radio, and cable, if it comes, as well.
However, for the reasons which I have given, I hope that cable will not come just yet. I have the feeling that it will inevitably come at some time. I appreciate that it has great possibilities, but not in the entertainment sphere. The possibilities of cable are quite different; they are social and economic possibilities. We shall not be ready for those for another couple of years. Therefore, this occasion is perhaps one of those unusual cases—and maybe it is very rare that it happens—where Parliament, instead of acting as Parliament normally does, too slowly, is in fact acting too quickly. It is my unusual plea to the Government tonight to drag their feet, and to drag them hard.
§ 5.36 p.m.
§ Baroness Lane-Fox
My Lords, I must apologise to your Lordships that other business kept me away from the Chamber during the early part of the debate. Change, even when for the better, can be very uncomfortable in the intermediate stage. The fear and apprehension about the cable system springs from a lack of knowledge and understanding of the complex subject, plus the view that the telly allows the forces of good and evil to wage battle in the home. The charge of evil, of course, is reinforced by a surfeit of violence and sex films in programmes over recent months.
It is against that background that the White Paper's statement in paragraph 2 of the Introduction, which says that,any attempt to disregard the technological revolution which is now upon us, or to embrace it half-heartedly, would be shortsighted",must be seen. As an avid viewer—and here I disagree with the noble Lord, Lord Somers—it seems to me that we have got to get the new system to work for us. Just as the innovation of CEEFAX is proving a godsend to the deaf and other people, so two-way information services, for instance, could be invaluably suited to help our lifestyle. Such things as electronic banking, shopping from home and household security systems hold the prospect of reducing the chores and using the telly for more than just entertainment and off-the-cuff interviews. These are the sweets of the future: at present, it is the bitter time of reckoning.
It is the Government's view that a separate Cable Authority be set up. Nevertheless, in their submission to the Home Office the IBA say that they have the establishment and organisation well laid to undertake the phased development of the three DBS channels. I would not presume to try to speak on such subjects, which are very complex. On the other hand, I would ask that from the earliest stage plans be made to get the facts across to the public. The IBA considers it hardly likely to be acceptable that contract applications be kept totally secret, and inevitably there will be seen a need for public comment. With my small past experience as chairman of the London Local Radio Advisory Committee to the IBA, I humbly recommend discussion in order to get initial interest and loyalty to a new system. Could it be that competing channels would be available to parade the arguments in favour? We have, as we know, breakfast, day and evening viewing, with a more or less captive audience, and how 684 to inform and attract the rest to the new potential fruits must be a conundrum.
The IBA questions whether a self-financing system, such as IBA, could be certain that sufficient funds, whether from advertising or subscription, would necessarily be available to meet the cost of new services. Market conditions, advertising and even the bolstering up of a company through hard times—to the extent, once, where the chairman of a local radio company put in pawn his own works of art—have hugely helped existing companies.
It is my belief that we, the public, are greatly indebted to the innovation and determination of the stalwarts who believe in broadcasting. Certainly the wonder of increased television opportunities is very relevant to those immobilised by age or handicap. Perhaps I may be allowed to speak from my experience as a teenager of having been inert and splinted and unable to turn the page of a book for nearly two years. I realise what a miracle it would have been to have had telly then. To be excluded from participating in so much of life made one more of a responsibility for the carers. Mark you, I have no grouse; the bonus was just to be kept alive! But I know how it was to be immobilised in the 1930s as a 12-year-old without these wonders. There are so many charities for disablement causes which diagnose that lack of dissemination of advice and information is one of the worst drawbacks for disabled people to overcome. I ask that the possible air time be used usefully, enjoyably and profitably.
As a member of the Carnegie Trust Arts and Disability Committee, with Sir Richard Attenborough as chairman, we shall certainly hope in the next year to obtain viewing time to tell much that will encourage people at home, and much more than that when the cable system comes into operation.
As I understand it, the Government propose to progress with legislation at an early opportunity and to establish an authority with the necessary statutory powers. It will be that authority which will further all these hopes. I am certain that the Minister will think carefully about the IBA's suggestion.
There is one more point on which, for once, I am in agreement with the noble Lord, Lord Jenkins of Putney. Even now is not too early to think about programme listings. Although these are made available under licence to daily newspapers, the fact is that weekly publications are licensed to print only a selection of programmes, but no comprehensive guide. For instance, Time Out magazine says that the advent of cable and satellite television will produce further complications to the monopoly of programme listings which the BBC and ITV are so keen to protect. I hope that this aspect will not be lost sight of. Apart from that, I wish the proposed legislation the very best and hope that it will fulfil our highest aspirations.
§ 5.43 p.m.
§ Lord Hill of Luton
My Lords, those of us who in another place were colleagues of the noble Viscount who opened the debate will recall his vigour, his ability, his good humour, and indeed indirectly the help that he afforded to those members whose hearing 685 was declining. We are delighted that he has been appointed Leader of this House.
In the debate on the Hunt Report last November I, like others, voiced some critical comment. Let me say at the outset that I am glad that some of the criticisms that were made in that debate have been met in this White Paper. But some have not. I expressed concern then and I feel it now that further and stronger competition with Independent Television may lead to a lowering of standards, perhaps in the BBC as well as in Independent Television.
I want to develop this point. It is not out of sympathy for the investors in Independent Television. It is because I recall—and I was then the Minister responsible for sponsoring broadcasting, the Postmaster General—the early days of Independent Television when it was hard up and worried about its prospects of financial solvency, and when it secured over three-quarters of the audience, with the BBC left with a quarter. Why? Because in that situation inevitably it follows that there is a trivialisation of what is on offer. It is only when there is a sense of security that you get the kind of change that we have seen, in which Independent Television has now achieved equal esteem with the BBC, despite all the gloomy forecasts when it first came before Parliament.
It is because of this that I am much concerned. Already it appears certain that satellite broadcasting will include the advertising of other and foreign programmes projected directly into the homes of people in this country. That of itself presents a problem. The financing of the fourth channel is presenting a problem to Independent Television. But to introduce a competitor who is officially given advantages in gathering audience and in gathering income is I think a serious mistake.
Let me just develop that point, for it is that point which is my main concern. It is dismally true that "trivial" beats "serious" in broadcasting terms. We should not be surprised. An argued intellectual leader in The Times does not stand a chance in terms of numbers with page three of the Sun. Those are the facts of life. We do not want a retreat of Independent Television to the urge to get an audience at all costs. That means trivialisation. In my day it used to be said that any service could defeat the other by putting on American films. It is a dismal thought, but nevertheless that was the experience of the professionals—that when there is an urge to get an audience in order to get an income, that when there is financial difficulty, trivial wins. That is what must be faced.
As I have said, the White Paper meets many of the points that were raised in that debate, but not all. Let me take some examples. I welcome the application to cable of the similar requirements to the ITV advertising—maximum of seven minutes per hour and six minutes on average. But why is cable television to be exempt from that rule where the channel is concentrating on specialist fields or on sport? I see no reason for that. Why should it compete in this way with Independent Television? Why should there not be a general application of the seven-minute and the six-minute rules governing the amount of advertising? It makes one somewhat suspicious that the road to 686 profitability in cable is sought to be made easier by lowering or changing the standards by pronouncing one rule for Independent Television and one for cable. Why should not the limitations on advertising be the same for both services?
Restriction of foreign material is to be 14 per cent. It applies to both services in the interests of British programme makers. After all, so much American material is so cheap, it having earned its corn in the States and then being sold to this country, there is a great financial temptation to increase the amount of that material. Heaven knows, we have enough of it already.
But why a difference? Why a difference between the standards for the two sevices? I am quoting from the White Paper, which says that "the Cable Authority should be required to satisfy itself that a proper proportion" of British material shall be broadcast. What is a "proper proportion"? How do you work that out? Let us look again. This is a control which needs to be precise and not vague, and the very opposite is the truth. It needs to be absolutely precise. Account should be taken of the channel's "intended character". What does that mean? When I was chairman of the authority we were taken in by the intended character of the company to put on Weekend Television. My word, were we wrong. It was not until John Freeman came in that in fact it became a first-class company. Intended character? How the blazes do you measure what is the intended character?
I could go on, but I will not. There are all the other arguments. It will give British programme makers time to prepare the material, so that the limitation of 14 per cent. can be applied. What nonsense that is. Channel 4 did not need this period of rehearsal, as it were. Bless my soul, by the time those cables are sunk, by the time the legislation is through, if any time of rehearsal is needed there is going to be plenty of it available.
The White Paper produces no effective requirement of range and balance. Impartiality is not a precise requirement for this newcomer to the field, but it is a precise requirement for the existing services. Mind you, there are words used that there must be no bias across the generality of the services in a particular system. I am not clear what that means.
The Cable Authority may wish to take positive steps to satisfy itself that there is a wide-ranging access".What in God's name does that mean? Why not apply the same requirement and the application of the single word "impartiality" as a rule to govern the service? It really is undesirable in all these little ways that cable should be given this greater freedom so that more and more people may be tempted to invest in it.
There is one silly thing. It is trivial, I know. In my innocent, non-scientific way I thought that the development of this marvellous cable system throughout the country was going to make less necessary the forest of aerials that is to be found in urban areas. I thought, "Bless my soul, there is something in this". How often is the view of a locality spoilt by them. But not a bit of it. It contemplates—not very vigorously, let it be admitted—that when the time comes that the cable company is satisfied that everybody can receive 687 BBC and ITV direct, then the cable company is to be spared the requirement to transmit those two services. In other words, we are going to have slightly more aerials. I know how unscientific I am, but it seems to me to be absurd that one of the results of this may well be, in certain circumstances, if not more aerials certainly the same number of aerials.
Finally, I hope that the new service will begin on terms of equality in these important matters with Independent Television. Independent Television is in for a difficult time financially. It has had a taste of it with the fourth channel. It is in for a difficult time because of satellite transmissions. For heaven's sake let there be terms of equality between these services. Do not give cable a position of greater strength, for in my view, and I hold it deeply, to give cable an unfair advantage will lead inevitably to a degradation of standards of independent television for the reasons I have given, and that would be a great pity. The growth of independent television from a trivial to a comprehensive service has been truly astonishing. Do not let us go back on that.
I urge the noble Viscount, who will bear a heavy responsibility for this, to bear in mind that the dangers of unfairness, the dangers of eating unnecessarily into Independent Television income, bring a danger of greater trivialisation and damage to services about which one need not use extravagant language but they are first class services, as the world knows it and sees it. It is unnecessary to run these risks. Let the rules, whether they be about advertising or otherwise, apply equally between the two services. Then although some of us may be sceptical about the claims of modern science and technology to sweeten our lives, to make them easier, that is partly because we are too old to learn new tricks. But we can avoid doing unnecessary damage. If the real purpose of this scheme, of this plan, is for easier communication under a host of headings, so be it, but not at the expense of television standards in this country.
§ 5.58 p.m.
Earl De La Warr
My Lords, before I start I must declare an interest in that I am a director-elect of a cable consortium that has yet to be incorporated, and we shall in due course be applying for a franchise. Before I go on to say what I intend to say, I must bring to your Lordships' attention how disappointed I was with the views that we have just heard from the noble Lord, Lord Hill of Luton. He is a very wise man. He is a man who has known all sides of broadcasting; and I was greatly disappointed to hear a speech which seemed to be wholly embedded in the past.
I was also disappointed to see a lack of vision, a defensiveness, which seemed to me to epitomise what I hope are a very small number of broadcasters who are not prepared to look into the future about the new things which may be coming to us, but are only prepared to look with suspicion at that which is new and yearn for the retention of that which is old.
§ Lord Somers
My Lords, I am sorry to interrupt the noble Earl. Would he not agree that the future is not necessarily always better than the present?
Earl De La Warr
My Lords, the noble Lord has given us the benefit of a platitude with which I could not possibly disagree.
I welcome the White Paper. It give a marvellous send off to an exciting and financially hazardous new industry. I shall deal later with the word "hazardous" at some greater length, but I should say, as a generalisation, that there is no new industry in this country that is not hazardous at its inception. It would be strange indeed if this were an exception to that rule.
I shall deliberately talk to your Lordships at some small length about the financial and the marketing aspects. The first thing we have to remember is that this is an extremely high cost investment. I differ slightly from the other statistics which were given, but when one thinks that to cable up half the United Kingdom one would have to spend no less than £2½ billion, your Lordships will see that we are talking about no small matter. I entirely agree with the figures which came from the noble Lord, Lord Winstanley, who has no doubt had access to financial forecasts, and with his comments that it will take between seven and 10 years to reach a return on the investment and not less than four years to get to the year in which, for the first time, there is a positive cash generation.
One other thing needs to be said about the nature of the investment, because a large part of it will go into cable. That cable will go straight underground, and from that point onwards, the asset will be worth only what it will earn. It has no break-up value; it has no alternative use. It is scrap. That perhaps accounts for some of the attitudes we are now finding in the "square mile" towards investment in the cable itself. Nevertheless, I am confident that in due course the money will be found to embark on cabling on a large scale.
I refer next to some aspects of the high risk element in this industry. First, we are dealing with a market that has been wholly unexplored. Some noble Lords will ask about everything that has been happening in the United States for years. I would only say that many an entrepreneur has breathed his last moments standing on the parapet of Westminster Bridge, simply because he forgot that the ways of the American market and the ways of the British market are many a time totally unalike. I say without any fear of contradiction that we know very little about this market upon which we are about to embark.
What is it that we have to find out? We have to find, to be precise, what percentage of the households that are cabled will be prepared to pay how much extra for what degree of extra choice of programmes of what particular type and produced at what sort of cost. This is the orbit of the market that has to be explored. We must not forget that the money has to be invested underground before we can find the answers.
That is why I welcome the 12 pilot projects that will be licensed to start so soon. I urge the people who are doing this to make the benefit of the marketing information that they acquire available to those who are likely to follow them. English businessmen are not very good at giving away that sort of information. They are not nearly as good as the Americans. I do not suggest that the Government should nudge them in any way, but I hope that we will all suggest to them 689 that it would be helpful to know how they fare on the marketing side.
I shall now say a word about the sort of competition that our salesmen will have to face. My honourable friend, Mr. Kenneth Baker, said in another place last week:It"—this is the cable experiment—will mean a wide range of educational programming not yet really available on television. It will mean interactive services such as home shopping and home banking. The television set will no longer be simply a rather passive electronic receiver in the sitting room. It will enable the viewer to communicate".—(0fficial Report, Commons, 30/6/83; col. 784.)I entirely agree with that. This is the excitement in the long term. But, make no mistake about it, in the early days it will be entertainment based. None of the exciting things about which my honourable friend spoke will come about unless we can establish a sound base of subscribers. Establish it we will, only if we offer them the things that they want and which, in part, they are already used to.
The competition lies in what is already available. I have always believed that there were millions of households in this country—this sort of thinking is not perhaps welcome to a television producer—where the button is never pressed during the evening except the button to turn the machine on. Thereafter I believe that the same programme remains on all evening, except at the cost of a household revolution. There are millions of people who are satisfied not with four but with just one. If that is not competition, I do not know what is, in this context. There are others who have made rather wider use of the television set but who do not feel they want to spend more than they have already spent on the considerable licence fees to get extra programmes because they are satisfied with what they have.
At the other end of the spectrum are people who have become dissatisfied and who have purchased a video cassette recorder. That is the real competitor to cable. Already 22½ per cent. of households in this country own or are renting VCRs. The trade believe—and I agree with them—that over the next few years this can well go up to between 40 and 50 per cent., and I must remind your Lordships that with the video cassette recorder you get exactly what you want, provided only that you can acquire it and are prepared to get up off your backside and go and find it. So these are powerful competitors, indeed.
One other thing has to be said. It is that there will be many people who will take the service on the basis of suck it and see. Some will suck it and will like it and others will suck it and will pack it in. This is a factor that is well known in the United States and well known in the cable industry in this country: that there is an enormous turnover all the time. In the United States it is what is known as a churn rate. Even while the market was going up, you might have at least 70 per cent. coming off during a particular year—and that is a very expensive way to increase the audience. I hope that in what I have said up to now your Lordships will not mistake pragmatism for pessimism; but these are things which need to be said and I think have not been said enough during the course of the many debates 690 that have been held in both Houses on the subject of cable television.
I now want to come to some aspects of the White Paper and I will deal with them as quickly as I can. If I go on for too long, I apologise; but cable has been my life for 20 years and I should like to give your Lordships the benefit of what small experience I have. The control structure that is envisaged is, I have to say, an unusual one. Partly I think this stems from the fact that the noble Lord, Lord Hunt, produced the concept that the operation was really divided into two parts: that of the cable operator and that of the cable provider. A big company like my old company, Rediffusion, rather laughed at that, and did so because they always put the cable down and then relayed the programmes down it; so that to have it considered as two separate entities was something that they found difficult. I see the logic. But it has led to control being under two separate authorities.
The Cable Authority will licence the cable operator, and OFTEL (the Office of Telecommunications) run by the DGT (the Director General), will licence the provider. Not only that but, ultimately, the Cable Authority will be under the Home Office, and OFTEL will be under the Secretary of State for Industry. All right, this can work but I must give the warning that we have created a potential dichotomy. There is a danger of an overlap and a danger that, as a result of that, cable might be a kind of pig in the middle—and that is never a position that I terribly relish. Nevertheless I accept the way that things have gone. We must be careful to see that cable does not suffer and that we get the legislation right so that it takes account of this difficulty.
I draw the attention of your Lordships to Clause 3 of the Telecommunications Bill, which is shortly due to come back to us, in which the guidelines given to the Secretary of State, to which he is obliged to pay attention when licensing telecommunications systems under Clause 7, are enormously wide. The White Paper dealt with this; but I am bringing it up because we must be extremely careful in the legislation that the Cable Authority do not have the powers that they need eroded by something that is in the Telecommunications Bill, by a power that belongs somewhere else. So, please, legislators, go into this very carefully!
Secondly, we need a very strong Cable Authority. I know that it has been said that the Cable Authority should handle things with a light touch. With that I entirely agree; but they should have strong reserve powers, and I will give your Lordships one particular reason why that is so. It is because the Cable Authority as often as not will be not engaged in regulating the cable operators but in looking after them and seeing that the other quangos do not get after them and make their lives difficult. I note that the Office of Telecommunications is to have a director-general whereas, in the words of the White Paper, the Cable Authority will have a part-time chairman and some part-time members "with the necessary executive help". On the face of it, it does not sound at the moment as though we are looking at a potential Cable Authority which has the power or the stature that other authorities will have and which it must have. I hope that the Government will take that point on 691 board. As for the length of licence, I strongly suggest that the Government have further thoughts about this question of obliging the authority to readvertise the licence after 12 years. In financial terms, it simply is not long enough to make an investment worth while. I suggest that at the very least the Cable Authority be relieved of its obligation to readvertise and have the power to let the franchise go on for the full 20 years. By the same token, when we are talking about the licensing of the cable operation, I suggest that the state of the art is changing so rapidly that, by the time we get to it, it may be a false distinction to talk about switched or not switched and really it would be much simpler if we now made both licences coterminous at 20 years.
I must say a word about the must-carry obligations. I want to draw your Lordships' attention to what I regard as the main problems. The method that the Government are considering using at the moment for the system under which the broadcasting will be done from satellites is known as the C-Mac system. For reasons with which I shall not weary your Lordships, when C-Mac is converted to what it has to be so to be used by cable and re-encoded for the normal television set (which is the PAL set) each programme will take up 24 Megahertz instead of the 8 Megahertz that are taken up by the terrestrial programme. So that, if I can put it into channel form, by the time you have got five DBS channels and four terrestrial channels, you have used up 19 out of a total of 25 channels if 25 is what some people are going to start on. That does not seem to leave you with much more than a relay operation. I should like the Government to consider this point very carefully.
I should like them to consider it on one other score, and that is whether perhaps the noble Lord, Lord Hunt, might have been right when he said in effect that subscription television is not really public service broadcasting just because it comes through the BBC or ITA. But it is not really where it comes from that is important; it is the nature of the programme. I would recommend the Government to give another thought to freeing the companies from having to carry subscription television unless they really want to and can do so on terms freely negotiated with the broadcasters.
I should like to make one final point, which is one that does not appear in the White Paper, and it is a point which may be unfamiliar to some of your Lordships. In the United States the growth of cable was enormously helped in the early days when it was being done by private individuals and later on when what were called the multiple systems operators—the big companies—came in and acquired systems. As I say, it was enormously helped by the fact that cable systems were freely transferable. They could be bought and sold in the same way as local newspapers can be bought and sold in this country. It is true that if, say, Associated Newspapers is buying a paper the Minister may refer the matter to the Monopolies Commission. I should like the Government to consider something like this because it would enormously encourage investment; and to encourage investment is, I must say quite frankly, one of the Government's most important duties at this time. My Lords, I have spoken for far longer than I should. Normally I would not dare 692 to speak for as long as this, but I have been connected with cable for some 23 years and so perhaps it is not too inappropriate that I have taken up 24 minutes.
§ 6.22 p.m.
My Lords, like the noble Earl who has just spoken, I, too, heartily welcome this White Paper and I want to congratulate the Government on having produced it. The subject is a highly technical one, but the paper is so clearly written that even I can understand most of it. I should like to touch briefly on a few points. First, regarding the controversy about co-axial versus optical fibre cable, surely we must look ahead and use the most advanced technology available both for the sake of our own system in the long term and for the sake of our export trade. I therefore urge the Government to do all in their power, whether by stick or by carrot, or both, to encourage the use of fibre optic cable, in the development of which Britain leads the world. It must be best to start with the most up-to-date equipment. Not to do so would be like deliberately equipping a new house with an old-fashioned fuse box instead of with contact-breakers.
Secondly, the Government have taken the view that the Cable Authority should be a completely separate body from OFTEL. I am not entirely convinced that they are right about this, although I see the force of their arguments. Against them, I would put the well-known inability of Government departments to work together: they are still at the well-known game of "passing the buck". It is quite clear that cable and telecommunications will be so intertwined in the future that the very closest co-operation between the respective authorities will be essential. I hope the Government will reconsider this but, should they stick to their present view, I wonder whether they would consider housing the Cable Authority under the same roof as OFTEL and arranging that one member of the board of the Cable Authority has the special duty of liaising (to use a horrible word) with the director of OFTEL or one of his staff; and possibly the same as regards the IBA.
I hope that particularly close liaison will be maintained between the Cable Authority and OFTEL over the laying of cable. We have too much digging up of roads, first for one thing and then for another, causing great inconvenience to the public and involving expense for resurfacing, when it is done at all. It would be nice to see the day when all services—water, sewage, electricity, gas, telecommunications and television cable—were laid through one duct with access for servicing at frequent intervals.
Thirdly, in paragraph 60 of the White Paper we read that the Government's view is that,it would not be right at this stage to impose upon the Authority a formal duty to seek to extend cabling to the whole of the country".But I hope the time will come when they will think it is right and that that time will not lie too long ahead. Once telebanking and teleshopping become the normal practice in large parts of the country, areas where these facilities and others are not available will be deprived of services which could become as essential to their inhabitants—of whom I am one—and not only to sheep and tourists as are the postal and telephone services today. In addition to 693 this, cable is surely the answer to the poor radio and television reception which is often a problem in remote areas.
Then, regarding pay-per-channel versus pay-perview, I should like to see a choice of either. For example, I cannot see why a sports enthusiast who also loves ballet should not be able to subscribe to a sports channel and also order a specific ballet programme to be switched on and charged to his account or his credit card when he wished, or vice versa.
Like the right reverend prelate the Bishop of Wakefield, I was very glad to hear the noble Viscount the Leader of the House make an emphatic statement of the Government's view as regards standards of taste and decency, but I share the anxieties of the noble Lord, Lord Nugent of Guildford, on this subject and on the inadequacy of the Obscene Publications Act. I hope the Government will take this opportunity of tightening existing standards. It is important to keep in mind the fact that many children, who in my opinion should be in bed and asleep by eight o'clock, are often still watching television well after ten o'clock at night. I cannot go so far as my noble colleague Lord Somers in deploring television, because if the opinions of the young are not formed by trashy television programmes they will probably be formed by trashy magazines or books, unless they are so much better educated that they resist all trash. Good television programmes can help them to do so; and anyway you cannot put the clock back.
Finally, the development of cable television is one of the most exciting things that has happened in my lifetime and I greet it with particular enthusiasm, especially the prospect of such services as telebanking and teleshopping and also the possibility of being able to subscribe to channels which carry programmes that I want instead of programmes that I do not want. Like the noble Baroness, Lady Lane-Fox, I welcome the benefits which cable television can bring to the sick, the disabled and the old.
§ 6.29 p.m.
§ Lord Aylestone
My Lords, it is a particular pleasure to me, on a subject in which I am particularly interested, to hear the White Paper introduced by the noble Viscount who comes to us as Leader of the House of Lords. He and I have known each other for a very long time, serving in another place. We are both members of probably the most powerful trade union in the world: that of Chief Whips. But perhaps it is not everyone who will agree.
Nevertheless, in dealing with this White Paper I do not intend to follow the noble Earl, Lord De La Warr, into the technicalities, for the simple reason that I cannot do so. I just do not understand many of the technicalities of which he spoke; but I take his word for it that these things are extremely important.
It was a pleasure to read the report of the Hunt Committee some months ago; but I could not do otherwise than say that I believe the Government have modified it to considerable advantage and they have left out some of the things that were worrying at that time. I will have one or two queries during my short speech, and I hope that in his reply the Minister will be able to put my mind at rest and make some of the 694 uncomfortable feelings I have about one or two matters rather more comfortable.
It has been said that 99 per cent. of all homes in the United Kingdom are reached off air by television, and the other 1 per cent. could probably be reached by cable. The terrain is the reason why not all homes are reached and it is impossible to get a signal to them. But they could be reached by cable, although they are unlikely to be reached on a commercial basis, because it would be much too costly. The only hope for that 1 per cent. is direct broadcasting by satellite because, given the right dish on the side of the house, it should be possible to get a signal from a satellite almost anywhere.
I should like to say a word or two about the Cable Authority. I am so glad that the Government have decided to set one up and I am delighted with the figure of seven people that they have chosen. More than about seven would have been quite unnecessary for the work which they have to do. A figure of 16 to 20 for the BBC and the IBA is probably right. It is also right in those circumstances to have representatives of Ireland, Wales, Scotland and England, and probably a statutory trade unionist and a statutory woman. It is right in that case, but it is not right in the case of an authority of this sort. But I could not care two hoots whether they are all women or all men, so long as at least two of them have some technical knowledge, and at least two of them know something about broadcasting and programmes. So I agree that seven is about the right number.
They are to be financed by fees received from the customers; but I am afraid that in the early stage they will need a substantial Government loan in order to get going. I say that because I think that the IBA had a loan of about £2 million, which was very promptly repaid. But if the Government could give the new Cable Authority a loan at a fairly low rate of interest, it would enable them to get going before they can collect their fees and dues from the cable companies.
The staff of the authority are to be appointed on a part-time basis and that is probably right. It is equally true of the BBC and the IBA, except that from my own experience the chairmen of those authorities do a full-time job on a part-time salary. But it was ever so and I have no doubt that it will continue to be.
There is I am sure a case for independent television companies and newspapers taking some shares if they so wish in the cable companies—not too many and certainly not a controlling interest—and I see no reason why they should not take an interest in the areas where they are broadcasting on air. But apparently there is some doubt in the mind of the Government whether it is wise to do that. The Cable Authority, in awarding licences, will first need to be assured of the solid financial stability of the company to which they are offering the franchise. They will need to be sure also that the cable company know precisely what they will have to face in the early years, and that they have the ability to do the job.
We are always worried about the influx of what might be regarded as foreign capital into British companies. But in my experience in the early days of independent local radio, we would have found it very difficult indeed to go on the air in time, as we did, 695 without the help of Canadian know-how and Canadian money. I do not see any reason why this should not happen again. Of course, United Kingdom and EEC companies will also join in on the financial side. So I urge that the Cable Authority follow the method adopted by the IBA and make sure that the franchises are fully advertised when the authority is set up, and that applications are produced for everyone to read.
The Cable Authority is to have some control over programme content. The Government have suggested a light touch and, occasionally, a retrospective look at programmes. This may be all right and it may work out perfectly. But on balance I prefer the Cable Authority, when in doubt, to have the right to preview programmes rather than always looking at them retrospectively. The rules on good taste and decency are not only difficult to define, but it is difficult to see whether they are carried out, and it is not always sufficient simply to look at programmes retrospectively and say that a mistake has been made. But that is a matter for the Cable Authority, although it may be rather more than the Government think they should do.
We learn that the cable companies are to be financed by rentals as well, but we must also bear in mind that they are entitled to raise some advertising revenue if they can. After what has been said this afternoon, I think everyone realises what an unknown quantity this is. I feel that the amount of revenue that can be obtained from advertising on television and radio in particular is almost getting near the limit now. We have the experience of Channel 4, which has been mentioned, whose programmes are now so much better. We also have the problem of TV-am. There are special circumstances in both cases. Channel 4 has had an industrial dispute going on for much too long, but both of them are finding it difficult to get enough advertising revenue. So I hope that the Cable Authority will realise this in granting franchises, and will also watch the amount of rental fee that a cable company charges to the customer and see that it makes it absolutely clear what the figure is likely to be.
Contrary to the Hunt Report, I am not of the opinion that there should be absolute freedom of time for advertising. I agree with the Government that it should be more or less six or seven minutes. I also agree that a code of practice on advertising should be set up, though not necessarily the same on as the IBA has. In this field, the Advertising Standards Authority could be very helpful.
I come now to one point on the White Paper which worries me and with which I disagree. It is the point which the noble Earl, Lord De La Warr, told us he particularly welcomed. I refer to the granting of 10 or 12 franchises before legislation is passed by either House of Parliament. I do not take the view that it is always wrong to behave in that way, but I am worried about it in this case. If the Government are going to grant these franchises—and presumably they will do so—they will be the plums of the cable television industry in this country, which will be granted in the months before legislation is passed. If they are the plums, the Government or whichever Government 696 Department is involved—the Home Office or the Department of Trade—will have to be particularly careful about them.
Earl De La Warr
My Lords, I wonder why the noble Lord assumes that they will be the plums. I had assumed that they would be very much the experimental places. I know for a fact that a number of small towns have been picked just because they are small and will produce the answers quickly, in microcosm form. Therefore I suggest that the noble Lord may be wrong in thinking that they are the plums. Not at all.
§ Lord Aylestone
My Lords, I concede that I may be wrong, but I think it is much more likely that it will be companies covering perhaps half a million people which will apply for these early franchises, or that some of the cable companies which are already broadcasting will apply for them, because they, too, will need licences. I hope that the Government will advertise these franchises in absolute detail and that they will ask the applicants for these 10 or 12 franchises to publish their applications so that the public can read them before the Government take a decision.
There is another side to this problem which worries me. Without a Cable Authority in existence, for a period of weeks—probably before legislation—some programmes will be going down the line into people's homes over which nobody will have any control. I may be told that the Government will have control over the content of those programmes at that stage. If that is so, it will be the first time in the history of this country that any Government will have interfered with the content of television programmes. Therefore they will be in a very difficult situation. If therefore the Government refuse to interfere—and I hope that they will—during those early months, it will be a free-for-all and anything will be able to go down the line into people's homes.
I urge the Government to set up the proposed Cable Authority as quickly as possible and get the necessary legislation through Parliament. In the meanwhile, I hope that on reflection the Government will drop the idea of a pilot scheme, with all its possible dangers, unless they can make it foolproof. They may think it wiser to wait until a properly constituted Cable Authority has been set up and is ready to take over.
§ 6.43 p.m.
§ Lord Willis
My Lords, I should like to join in the greeting that has been given to the noble Viscount. I speak as somebody working within television. Of all the Ministers who have had responsibility for television, it would be the general view that the noble Viscount was the most enlightened. I find myself. too, in a curious position today because I usually speak from the heights of the Back-Bench, from which lofty position Ministers look very small and remote. Now I find that they look large and menacing. However, I am determined to be brave and to press on.
I find that the score so far is 10 to two in favour of the White Paper. On the whole, I am in favour of the proposals contained in the White Paper, but I share many of the valid doubts which have been raised in the 697 debate and I should like to comment on some of them. First, however, I want to make one comment on the Government's claim—they seem to be putting on the clothes of virtue about this—that they are pressing ahead with speed on the cable issue. It is true that in the last 18 months there have been signs of movement, but to my knowledge—I believe that the noble Earl, Lord De La Warr, could confirm this—the cable industry has been pressing its claims for 10 or 15 years in this country and has met with a dusty answer from successive Governments. So the fact that it is only in the last 18 months that cable has become stamped on the national consciousness and bears now the label marked "Urgent" is either due to the noble Viscount or to some change of thinking in high circles. Anyway, we welcome it.
We welcome it not so much because cable will give people a greater choice of television programmes—I shall come to that in a moment—but because of its implications, which other speakers have mentioned, for information technology; the so-called interactive services. That is where everybody agrees the potential lies. But even here it is necessary to utter a word of warning. We have heard a great deal about the benefits that will come from these interactive services; for example, that many people will not have to commute to work. They can stay at home by their television sets; their boss can speak to them directly; they can plug into a computer and get all the figures they need. My experience is that work is a social experience and that most men like to get away from their wives for eight hours, whilst most wives like their husbands to get out of their way for a few hours. If we had a nation of people all sitting at home working in their parlours on computers it would be a very dull nation indeed. Similarly, there is a great deal of exaggeration about shopping: that wives will sit at home and do their shopping. I cannot think that many women will be satisfied to buy a dress without feeling it, looking around and enjoying the social experience of shopping. So those two factors are greatly exaggerated. There are other aspects about which far too much excitement is being worked up without real justification.
Another claim for cable is that it will create a new industry and new jobs. We all fervently hope that this may be so, but could I ask the Minister to be more specific about it? Could he perhaps peer into the future and indicate the ways in which he sees a growth in the labour employed? The point is that what you lose on the swings you may well gain on the roundabouts, and vice versa. I know that to mention the Greater London Council in this august Chamber is to mention a dirty word at the moment, but in a report which the GLC prepared, called The Cabling of London, there was a suggestion that there would be actual losses in entertainment and in consumer goods production of some 25,000 jobs by the end of this decade. I cannot comment on that; I have no way of measuring it. But would the Minister care to comment upon it?
We welcome also the recommendation that cable programmes should be subject to the same controls as to decency as ITV and the BBC. The Hunt recommendation that there should be a so-called decency switch or key on all sets was almost the only ridiculous thing in an otherwise excellent report. The noble Lord 698 should have studied the history of the Crusaders of old. They had their decency keys, which they called chastity belts. The result was that the locksmith had a great time and the chastity belt went out of fashion.
More important, to my mind, is the question of the general nature of the material to be distributed on cable. I know that concern has been expressed about the danger that cable channels will be taken over by pornographic films. I welcome the suggestion in the White Paper that this is not what the Government have in mind. But we ought to remember, too, that a nation can be corrupted by pap as well as pornography. Indeed, in my view pap is infinitely more dangerous. It can be argued at least that porn stimulates, while pap merely reduces the brain to sawdust. In my experience, there is an awful lot of pap around, especially in America. It is cheap, and the temptation will be for cable, in the beginning, to buy in this material.
I can envisage, for example, that some people would like to run an entire cable channel of quiz shows. Those noble Lords who have been to America will know that they run these all the morning on American television and that they have enormous audiences. There is no doubt that cable could get a tremendous audience from that kind of programme. I think it would be wrong; and it would be especially wrong to do it at the expense of British material.
The White Paper indicates that there will be a requirement on cable operators to use a proper proportion of British material, which in itself is an advance on the Hunt Report. But again—and the noble Lord, Lord Hill, raised this question—what is a proper proportion? At the moment we allow 14 per cent. of foreign material to appear on our screens. But there is already pressure, even from the established television companies, to increase this by a significant percentage. The programme controller of Granada came round this week and asked that we should raise it from 14 per cent. to 16 per cent., or even 18 per cent.—a demand which I hope the Home Office will resist. They argue that they cannot afford to fill the afternoons with expensive British programmes and that they want to provide cheap American programmes to fill up the aftrernoons. If Granada take this line, and they are an established company with full production facilities, what are the cable companies going to do? There is a hint of danger here that has to be watched.
There is a real danger, having started with programmes from the United States and other foreign material, that the cable companies may be reluctant to change. It is an absolute illusion to imagine that one starts off running a station using cheap imported programmes and then, when one can afford it, gradually weans one's viewers on to more respectable material. It does not work that way. People will not go from trivia to something that is better—that has been tried all over the place and it just does not work. The viewers all leave and switch to a company that will give them trivia. That approach has been tried very often in the running of a theatre. People have said, "We will put on farces and cheap plays to begin with and then gradually build up the standard". When they have tried to do that, they find they are left with empty seats. That is a lesson that ought to be learnt.
699 Another important point is that the quota must take note of peak viewing. The Australian experience was very interesting in this respect. It was made a requirement on the commercial companies in Australia that they should use 50 per cent. Australian material. It was then discovered that every evening was filled with American programmes. When they were asked what had happened to the 50 per cent. of Australian programmes, they answered that in the afternoons they showed Australian sport and horseracing, had an Australian quiz in the morning, and broadcast "Good Morning Australia" at breakfast time. In this way they used up the 50 per cent. quota on news and trivia and imported expensive drama programmes from abroad. The situation is much better now, but, even so, it is a lesson that ought to be learnt.
I should now like to say a word about the authority which it is proposed to set up to control cable development. It is obviously necessary to have such a body, but the revolutionary changes which have been forecast with the introduction of cable can bring economic and social upheavals. Although these cannot be denied, they can and must be regulated. What does "regulation" mean? We are told time and time again that the authority will govern with a "light touch", but we have heard in today's debate some of the dangers that may come from unrestrained and unrestricted cable. This may mean that a light touch will not be enough and that the touch ought to be at least as heavy—or the powers at least as heavy—as those which rest with the IBA at present.
For example, will the new authority have the power to direct cable operators into areas where the risk is greater or the returns less obvious? Will the Government ensure that there are people on the new Cable Authority who actually know something about cable and entertainment and not follow the usual practice as with the IBA, which is made up—with rare exceptions—of well-meaning but bungling amateurs who run a great television service and know nothing about television?
I come now to one key point. It has been suggested that because cable operators will choose only profitable areas, and because the element of payment by the consumer is an essential, cable will be divisive. Indeed, the noble Viscount the Lord President of the Council used the phrase,the country will be cabled".From reading the White Paper, and from listening to this debate, it is quite obvious that the country will not be cabled. There will be large areas of the country and large sections of the population which will not have the benefits of cable or of an interactive service in the next 10 or 15 years, if at all. I appreciate that it is necessary to start somewhere and that the wisest course will be to develop first in those areas where the cable operators can limit their risk. But what about later? Is it the intention of the Government, in the long run, to have a national cable network? This would be of immense benefit to this country but, as we have already heard in this debate, the cost would be almost prohibitive.
What is proposed in the White Paper, and what will be proposed in legislation, for all the fine words about a national cable system, is a cable system that will exist 700 in certain small, and fairly profitable, areas of the country and not in others—and not a national network at all. If that is the case, there will indeed be two nations and the technological revolution we have proudly spoken about in our debates on cable, and which is mentioned in the White Paper, will run on one leg. These are points to which we shall return when the Bill is introduced.
All the Bills and White Papers, and all the debates in the world, cannot answer one fundamental question: is there an audience for cable television? We do not know. Nobody knows. I have some doubts. If there is an audience, I doubt very much if it will be the "new" audience some people speak of. There are only 50 million-plus people in this country and there is a viable limit—there must be—to the amount of television and information that they can watch, just as there must be a limit to the amount of money that companies can spend on advertising.
I understand that this country already spends more on advertising per head of its population than any other country in Western Europe, and perhaps even more than the United States. There must come a limit to it. So when people talk about meeting the demands of the public—and I cannot see any visible demand from the public for cable—and when we talk about "cabling the country" and so on, and about the marvellous benefits we shall obtain from this, I get a whiff of the ground nuts scheme—just a tiny smell. With the ground nuts scheme, everything was going to be great: ground nuts were going to revolutionise our diet and everything else. We put millions of pounds into that scheme and nothing came out of the ground. I sincerely hope that will not happen with cable—but there must be a frontier to expansion.
We have heard already that VTRs are selling fast and that something like 22 per cent. of the population of this country now have them, and that it is estimated that in another year that figure will be up to 40 per cent. or 50 per cent.
§ Lord Willis
Anyway, my Lords, there is an enormous market for VTRs and that represents great competition to cable. There must be a frontier to expansion and I suspect that the cable audience will be drawn largely from existing audiences—and, as we have heard already, the implications for the BBC, and especially for ITV, are very obvious, because of the withdrawal of advertising and the consequent effects on standards—particularly in the case of commercial companies.
But that is the future—and it is an issue that the public, and the public alone, can decide. I, for one, will be very interested to see if cable does attract the kind of audience that is being talked about. I admire the courage of those entrepreneurs who are to put some real hard money into this venture—not just hard money, but a lot of hard money. It is a risk that I 701 personally would not take if I had any of that marvellous stuff. For the present, we will give a conditional welcome to the White Paper. It is certainly a vast improvement on the Hunt Report and we hope that improvement will continue—and we shall press for certain changes—when the Bill comes before this House. In the meantime, we should like to welcome the Bill and give it a fair wind.
§ 6.59 p.m.
§ Lord Elton
My Lords, there is an agreeable air of authority and completeness in today's debate. The legislation on cable systems to which we are proceeding will rest upon the White Paper published in April; and the White Paper rests in very large part upon the report of the inquiry into cable expansion and broadcasting policy published last October. Such is the speed of developments in this modern world that my right honourable friend who commissioned both the report and the White Paper as a distinguished Member of another place is none other than my noble friend who is the distinguished and very welcome Member of this place who opened the debate today. His release from silence in this place has done a great deal to inform your Lordships' debate.
Others of your Lordships have each spoken with a special insight or from a special standpoint which has ensured that what they have said will receive very careful attention. The field we have covered has gone wider than that covered by the report of the noble Lord, Lord Hunt. That, of course, was necessary. His terms of reference focused particularly on the relationship between cable and broadcasting, but the White Paper had a rather wider concern. Cable, as the White Paper says, is the cross-roads at which broadcasting and telecommunications meet. There are policy decisions to be taken—or, in some cases, to be very properly deferred—which relate to technological issues quite apart from those which the noble Lord, Lord Hunt, and his two very able colleagues were asked to look at.
The White Paper therefore discusses not only matters such as taste and decency, religious and political channels, and the importance of encouraging United Kingdom programme production—matters of general concern on which many of us have deeply-felt views. It also deals with the relative merits of "switched stars", on the one hand, and "trees and branches", on the other—questions which are also of great importance but on which fewer of us feel able to express a personal view—and offers encouragement (which the noble Lord, Lord Ponsonby of Shulbrede approves) to the use of and provision for "switched star" systems.
As a result of these developments there is the prospect of an increase in choice of services that may threaten to bewilder the consumer and may threaten also to outrun the ability of producers to provide material suitable for transmission, as the noble Lord, Lord Willis, suggested. There is also the prospect that the consumer will suddenly find himself released from his traditionally passive role and able to send signals back up the line down which he receives them. The implications of that are considerable, and I shall return to them.
702 These prospects are exciting and challenging, and they present the Government with two sets of duties. The first is to protect the interests of the individual, the receiver of the service; the other is to advance the interests of the community in the development of the service. Properly developed cable can well provide us with many benefits; that is widely recognised. Very few people are actually against cable, though two of them seem to have spoken this afternoon. Even the noble Lord, Lord Ponsonby, was most careful to stress that he was not against it. It is the terms of his welcome, and that of his friends, for the new cable technology that I find slightly worrying. There are so many provisos in it. As I understand it, they would like cable to expand, provided we wait until others are well ahead of us in the technological race, provided British Telecom has the monopoly of installing the hardware, provided the programme services are regulated almost as tightly as public service broadcasting, and provided that no one who has paid to take cable actually gets anything significantly better than the person who has not. That restrictive approach would, we believe, give cable very little chance of getting off the drawing board and into the home.
The Government's broad strategy is clearly set out in the introduction to the White Paper, and it can be summarised in four key propositions: first, cable investment should be privately financed and market-led; second, regulation should be as light as possible so that investors are free to develop a wide range of services and facilities; third, the regulatory framework should be flexible so that it can evolve alongside technology; and, fourth, a small number of key safeguards must apply in both the broadcasting and the telecommunications areas, both to ensure that cable enhances the existing range of services and to take account of its ability to address people directly in their homes.
The last of these is in many ways both the most important and the most difficult of the four. It is important because it is in this way that we seek to get to the potential benefits of the future without, in the process, forgoing the very real benefits of the present, which, as the noble Lord, Lord Somers, pointed out, may well prove to be superior. And it is difficult because in their different ways both broadcasting and telecommunications have, up to now, been highly regulated and very little exposed to the normal healthy pressures of competition. The Government's view is that we can only enable new technology to fulfil the potential which it so clearly has by permitting greater competition. At the same time we have to start from where we are, and that means recognising that new services for some could, unless we are very careful, lead to worse services for others.
If I do not say much about the telecommunications issues it is because your Lordships had an opportunity to discuss some of the underlying issues when considering the Telecommunications Bill before the election, and we shall no doubt be giving further attention to these matters when the reintroduced Bill reaches us from another place. We have, however, repeatedly made clear our commitment to ensuring that existing telecommunications operators can finance a universal service. For that reason we decided that British Telecom and Mercury should retain the 703 exclusive right both to provide voice telephony and to link local cable systems with each other. In addition, we have, for the initial franchise period only, restricted cable companies in the provision of data services in certain key business centres crucial to BT and to Mercury. These are the safeguads which we judged to be necessary in the public interest. We had to strike a balance, and we did not expect to please everyone. But our proposals will give cable companies a large measure of freedom to develop and market new interactive services which could, in the longer term, be of great economic and social significance.
In the meantime, however, if cable is to get going it will clearly be on the basis of cable television. If the extraordinary success of the video recorder over the past two years, to which my noble friend Lord De La Warr referred, shows anything, it is that people are prepared to pay a lot, often far more than one could safely predict, for additional entertainment services in the home. Telebanking and teleshopping, if I can use two rather unpleasant newly-coined words, are likely to catch on over a period as attitudes change and as the perceived cost to the consumer gets less. That is in the future. But the television market is there now for cable operators who can offer the right material at the right price. The Government's objective has been to give operators as much freedom as possible while both safeguarding the interests of those who will not be on cable for many years and maintaining certain basic standards in matters such as good taste and decency.
May I now turn to the remarks of your Lordships in the course of this debate. The noble Lord, Lord Jenkins of Putney, whose name has fallen at the top of this pile of notes, made a speech compounded, if I may say so without giving him undue offence, of Luddism and pessimism, with just a faint flavour of pacifism, in which I fear I found little with which I could agree. His view that we are dealing with a finite saturated market sounded to me very much like the arguments advanced by provincial newspapers which said that the introduction of independent local radio would wipe them out. His view that technology has advance far enough in communications is perhaps a little reminiscent of the view put forward by the man who insisted that no motor-car should go faster than the man walking ahead of it with a red flag if life was to go on as it was then known. I have a considerable regard for the noble Lord's abilities, and I shall assess them further as, listening to the local radio programme, I drive at 50 miles an hour to collect my local paper at the village shop.
The noble Lord, Lord Hill of Luton, argued, with his immense experience and seniority, that more always equals worse, and that trivial beats serious. I must say that I have never found that to be borne out in considering the noble Lord's own output in the form of his speeches; nor do I think that he has done full justice to the provisions we have made to negate what he regards as a law of nature. In case that reads amiss, I should say that the connection between the hypothesis he put forward and his speeches was that I have never found that more means worse.
Concern with standards has in fact been pretty universal, both in this House and outside it. Some of your Lordships have doubted, with the noble Lord, 704 Lord Hill of Luton, whether the practice will match up to our theory. First, let me reaffirm that cable television will be subject to the Obscene Publications Act. That is an important safeguard even if it is less stringent than my noble friend Lord Nugent of Guildford would wish. In addition the Cable Authority will have the duty to see that operators do not show other material which, though not obscene, is unacceptable on taste and decency grounds. The authority's sanctions are set out in paragraphs 75 to 79 of the White Paper. The right reverend Prelate the Bishop of Wakefield gave reassuring and most helpful support to those.
The Government have accepted, with my noble friend Lord Nugent of Guildford, that relying entirely on the power not to renew a franchise or, in an extreme case, to terminate it, might not be sufficient together with the Act. That is why the authority will be able, where an operator's performance is unsatisfactory, to impose a total degree of supervision for a period over part or all of the operator's services. For that period the authority could require the systematic submission of programme schedules. It could preview material and direct that certain programmes should not be shown. Revocation of the franchise must remain the ultimate deterrent but with this intermediate sanction at its disposal the authority should be well placed to ensure that operators observe the rules.
The noble Lord, Lord Aylestone, spoke about the previewing of programmes by the Cable Authority. We do not believe that as a general rule it would be right or practicable for the authority to preview programmes; but I can assure the noble Lord that it will, as I have said, have the power to preview programmes where it finds it necessary to do so. I hope the noble Lord finds that reassuring.
The Government took the view that it was better to exclude religious and political groups from any participation in the ownership of the operating company because the operator will control the overall package of programmes in each local area and, in practice, will normally have a monopoly. However, as the right reverend Prelate recognised the Government do see a role for the Churches in providing programme material for cable. Indeed, that is something we would welcome.
On the subject of control, the White Paper sets out the basic principles. The legislation will specify certain disqualifications. In addition, the Cable Authority will have a measure of discretion. In no case, for example, will an overseas firm be allowed to own more than 50 per cent. of the shares in a cable company. However, the Cable Authority might decide in a particular instance that a shareholding of 30 per cent. would be sufficient to give a foreign company effective control and it will have the necessary powers to insist that there is a genuine domestic control. Similarly, with existing media interests some rules will be statutory, but the authority will be left with some discretion to ensure flexibility. For the pilot projects the Government will have to reach their own view on what is acceptable, and we shall give potential applicants an outline of what we expect in the guidance notes. We have taken on board the anxiety expressed by the noble Lord, Lord Aylestone, that this might bring 705 Government too close to content control. We shall consider it, and his remarks, very carefully.
Noble Lords were concerned not only with the quality but with the source of the material shown. We are properly anxious to encourage the growth of British programme production rather than stimulating a flood of imported materials. The noble Lord, Lord Jenkins of Putney, questioned, with much else, whether our proposals in paragraph 122 are sufficient to do this. Those proposals are carefully expressed to secure a similar approach by the Cable Authority to that which has proved very successful when applied over many years by the IBA. I cannot tell the noble Lord, as he would wish, what a proper proportion may be in terms of hours and minutes—and the noble Lord, Lord Hill of Luton, seemed to share the desire for provision—but I can meet him at least in other terms. As regards product, it is that which maintains British skills and British standards at the level which still remains the envy of almost every other country in the world. This has been achieved by existing arrangements and we intend to continue them in the future.
§ Lord Jenkins of Putney
My Lords, is the noble Lord aware that the 14 per cent. was only achieved by agreement between the trade unions concerned and the independent television authorities? If in this new situation an attempt to achieve a similar limitation was unsuccessful, would the Government back the unions?
§ Lord Elton
My Lords, this is an issue to which I do not doubt we shall return. I take note of what the noble Lord said and will read it with care.
The noble Lord, Lord Winstanley—whose rapid return to the Chamber I warmly welcome—was concerned that existing commercial cable operators had captured only a small market. Certainly at present they serve only about 1.4 million households. But if 3.6 million people represents a small fish I ask the noble Lord to consider how much more attractive or, at least, varied will be the bait with which cable companies will be able to garnish their hooks.
The noble Lord was also concerned that the pilot projects will be limited to 100,000 homes on the basis that this is too small an area for the project to be viable. In taking this course we had to strike a careful balance. On the one hand, we needed to give encouragement to our own cable industry; but, on the other, there would have been little point in setting up a statutory Cable Authority to award cable franchises if substantial parts of the country had already been covered by private projects. The limit of 100,000 homes achieves this balance and while it will be up to potential applicants to consider whether a system limited to this size will be viable in their preferred area I believe the Government have created a significant opportunity of which many companies will wish to take advantage.
Another of the noble Lord's anxieties was that we have provided for no pay-per-view or sponsored programmes before the Cable Authority is set up. The government are being careful so far as is possible to avoid pre-empting decisions of the Cable Authority in the licences it proposes to issue in the interim period. The extent to which sponsored programmes and pay-per-view can be allowed will raise complex and 706 sensitive issues which the Cable Authority will have to examine carefully for itself in due course. We do not think it right to pre-empt its decisions on these matters. In any case, the Cable Authority is likely to be in existence before most of the pilot projects are sufficiently advanced to offer services to the public. The White Paper's restriction, therefore is not likely to be a significant constraint.
The noble Lord was joined by my noble friend Lady Lane-Fox in concern that bids for franchises should be published. Paragraph 68 states that the authority will have a duty to consider local views before awarding a franchise. The authority will also be required to publish the details of each application before the services come into operation so that those living in the areas concerned can see how the successful applicants match up to their promises when they deliver the services. Whether all the details of each application should be made public during the franchising operation will be for the authority to consider. Like the IBA it will I am sure wish to provide as much information to the public as it can.
My noble friend Lord De La Warr and the noble Lord, Lord Winstanley, were also concerned, with others, with the must-carry provision for direct broadcasting by satellite. I think that it is common ground that cable operators should be obliged to relay the existing BBC and IBA services; but I know that there are different schools of thought about DBS. The Government's position on the principle of this is clear. We believe that cable and DBS should develop side by side and that just as cable must relay the terrestrial broadcasting services, so DBS, if it comes along, should also provide its customers with those services.
Having said that, I recognise that there are some detailed and commercial issues which have given rise to particular concern in the cable industry. Only this afternoon my right honourable friend the Minister of State has been having discussions with the representatives of the Cable Television Association about them. These are difficult matters on which we have to strike a careful balance between the interests of cable operators, DBS broadcasters, the electronics industry and the consumer. In view of the talks which my right honourable friend has been holding I shall confine myself to assuring your Lordships that in reaching final decisions we shall pay careful attention to what has been said this afternoon.
The noble Lady, Lady Saltoun—I should like to commend her on her admirably concise and direct speech—and my noble friend Lord De La Warr are concerned about the relationships between the Cable Authority and OFTEL. They will have very different roles. OFTEL will essentially be concerned with the economic and technical aspects of telecommunications. The Cable Authority will be much more involved in qualitative judgments on matters such as programme standards and advertising content. Obviously there will need to be a close relationship between the two organisations, and I shall draw the noble Lady's interesting suggestions to the attention of my right honourable friend.
I have also noted what my noble friend has said about transferability. We shall certainly consider what he said, though we shall have to ensure that the Cable Authority's franchising powers are not undermined. 707 To take an extreme example, it would be obviously undesirable if a company which had been beaten for a franchise could simply buy out its successful rival.
The recurrent theme in your Lordships' speeches has been an anxiety about the way in which the advent of cable services may change some familiar features in the world in which we live. The noble Lord, Lord Winstanley, was anxious whether there would be a sufficient volume of skilled people to implement the choices which lie before us, and I remind him of our massive programme to get computers into schools and our massive programme concerned with how to instruct in the use of computers. I remind him that the Government have set up over 100 information technology education centres, aimed at training unemployed youngsters, and we have made funds available for additional posts in universities for research and development in information technologies.
Change therefore is a very real possibility, and we have the ability to bring it about; so there is a very legitimate concern. Indeed, I wonder whether your Lordships' concern has gone wide enough. My noble friend Lord De La Warr knows what I mean. These are not only the kind of changes of which the noble Lord Hill of Luton, and others, have so eloquently warned us. As my noble friend has said, the extent to which the potential of cable systems is realised is as yet uncertain. Its progress, at least in the early stages, is dependent upon the success of its entertainment aspect. But if it does achieve its potential there are changes in the nature, as well as the quality, of what would be available to us that have an entirely different significance. Above all, as my noble friend Lady Lane-Fox trenchantly pointed out, it is the interactive capacity promised by cable which offers developments which could have a profound, lasting, and fundamental influence on a whole range of matters—matters which hitherto we have regarded as being by nature fixed, or at best slowly moving.
It is not just a question of bringing up your bank statement on a screen, or even doing the shopping without leaving the room. The day is not far off when a great deal of the work done by a great many of the people now working in commercial and other offices will be able to be done as well, or indeed better, from home. The implications of that are considerable. The economic reasons for social congregation will have been greatly reduced. I would point out to the noble Lord, Lord Willis—and I am sorry to refer to him so infrequently, but the danger of speaking last before the wind-up is that the winder-upper has not got time to think what to say in reply—that recent research suggests that three quarters of non-managerial workers actually want to go out to work for the sake of the companionship that it offers (the research does not say that they want to do so in order to get away from the wife), for the absence of distractions, and because they like a clear division between work and leisure. But the fact remains that if you do not need to go to the office, you do not need to live near it. You can in fact live anywhere you like, any place to which the cable will reach, anywhere in the world. Maybe one day the only purpose for which businessmen will actually have to meet will be to shake hands. Before long we may be 708 considering with real anxiety whether people meet often enough for the social, and indeed the spiritual, welfare of our community.
We inevitably spend much time in this House discussing the immediate, day-to-day questions which face the country. Today we have considered developments which are going to take place over very many years, and at a pace which we should be unwise to try to predict. In the long term cable could lead to profound changes in the way in which broadcasting is organised in this country. Similarly, it could transform the framework within which we approach matters of telecommunications.
Nevertheless, however quickly cable establishes itself, all this will take time. To some that may seem a reason for proceeding slowly, for putting off cable expansion until other matters have been settled. The Government take the opposite view. If cable is a longterm development, involving heavy initial investment and no easy profits, then we must get ahead now. There will always be reasons for waiting. Channel 4, DBS, the privatisation of BT, the licensing of Mercury, are all new developments which could have served as pretexts for delaying cable expansion until times were quieter.
But if we wait, as the noble Lord, Lord Ponsonby, and other noble Lords, too, would like us to wait, we shall wait alone. The cable explosion has already happened in the United States. The French and Germans are laying plans, each in their own ways. Cable development here is not going to follow the American pattern, or any other pattern, if we move ahead now. In the Government's view, the White Paper points a way forward that is pragmatic, that strikes a fair balance between freedom and regulation, and that offers the right framework for cable to thrive according to our own pattern, which will be distinctively British. If we press ahead now, we shall have the best chance of ensuring that it will be to British industry, to British programme makers, and to the British public generally that the benefits of cable development will accrue. The White Paper sets out a strategy to take us safely into a dangerous future, and I commend it to your Lordships.
§ On Question, Motion agreed to.
§ House adjourned at twenty-seven minutes past seven o'clock.