Lords Sitting of 19 March 1996

Preamble
The House met at half-past two of the clock: The PRINCIPAL DEPUTY CHAIRMAN OF COMMITTEES on the Woolsack.
Prayers—Read by the Lord Bishop of Sheffield.

MRC: Alpha-Rated Projects
Lord Peyton of Yeovil Lord Peyton of Yeovil asked Her Majesty's Government:
Whether they are satisfied with a probable 70 per cent. rejection rate by the Medical Research Council in 1996–97 of alpha-rated projects.
The Minister of State, Department of Trade and Industry (Lord Fraser of Carmyllie): My Lords, the rejection rate illustrates not least the growing number of high quality applications to the Medical Research Council. Its budget increased by more than 30 per cent. in real terms during the past 10 years; but, like all organisations, the MRC must live within its means.
Lord Peyton of Yeovil: My Lords, I hope that the Government will bear in mind the fact that alpha ratings are not easily won and that to discard so large a proportion is perhaps a short-term view and is turning our backs on the future. Will my noble friend ask his colleagues in the Treasury in particular, who are chiefly responsible, to look at the matter again?
Lord Fraser of Carmyllie: My Lords, in the world of medical research we would wish to avoid any short-term approach. However, I believe that £282 million is a substantial sum to support that valuable research. Of course, it is not the only source of funding for medical research. However, I appreciate what my noble friend said; and no doubt others heard what he said, too.
Lord Taverne: My Lords, would not the MRC and the applicants save money if the MRC were to adopt the filtration and screening practice that is followed by the Wellcome Trust, which now funds more research than the MRC? Secondly, does not the turning down of such a high proportion of alpha-rated projects suggest that perhaps the balance has swung too far away from the support of basic research towards applied research which, in the end, depends on the basic research for which this country historically has a successful record?
Lord Fraser of Carmyllie: My Lords, I can draw no conclusion from the rejection rate about whether there has been a shift away from basic research. It might well be possible for the MRC to reconsider how it screens, checks or filters out applications. However, given the importance of the Haldane principle, to which we still have adherence, it would be risky for the Government to set out how they believe a better filtering system might he introduced.
The Earl of Halsbury: My Lords, is not the rating highly subjective? Does the Minister agree that all the MRC has to do is to invent a new rating called alpha double plus for those who succeed and then we are all home and dry?
Lord Fraser of Carmyllie: My Lords, I understand that within the scientific world there is always suspicion about the subjective character of such ratings. It is not for me to suggest the rating approach that the MRC ought to adopt. I readily accept, as I did in answer to my noble friend, that a large number of worthwhile projects do not receive funding from the MRC. We have attractively a growing number of high quality research projects. What should not be underestimated are the other sources of funding which are available.
Lord Walton of Detchant: My Lords, is it not the case that many of the high-rated projects which the MRC would wish to fund if it had the money available are being carried out in collaboration or partnership with some of the research charities, the universities and the NHS? It is true that the Association of Medical Research Charities is producing more money for medical research than does the MRC. However, is it not the case that the recent announcement of a 30 per cent. cutback on capital funding for the universities will seriously prejudice some of those projects with detriment to the long-term future of UK medical research?
Lord Fraser of Carmyllie: My Lords, although it is not within the responsibility of my department, I have received a number of representations to the effect that that change will impact on the money provided through the DTI to the MRC. I understand that a number of organisations are looking at the matter, as are the vice-chancellors, to see how to ensure that items such as laboratory equipment in particular should not suffer from the change. The noble Lord is right because my figures indicate that while the MRC will be spending about £282 million in the coming year, charities, the Wellcome Trust and other bodies will be spending about £50 million; and more than £400 million is being spent on research-related activity within the NHS.
Earl Jellicoe: My Lords, I must declare an interest as a former chairman of the Medical Research Council, and I must also confess a deep concern about the matter. Does my noble and learned friend agree that despite the inflow of funding from charities, which is most welcome, if the rejection trend persists, there is a real danger that there will be an erosion of our once dominant position in the field of basic medical research? Does my noble friend further agree that it is deeply disappointing for some of the brightest and youngest minds working in the field to see top-class applications rejected?
Lord Fraser of Carmyllie: My Lords, I understand that within the alpha-rating there are three sub-classifications and that all those projects which achieve an alpha-plus rating are funded by the MRC. As I have indicated, over the past 10 years there has been an increase of something like 30 per cent. in real terms. That is important. But I certainly share the

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concern of my noble friend that those who are brightest and best in the world of medical research should not be put off. However, once again I point to what I see as being very valuable alternative sources of funding, and I believe that those sources are extremely rigorous in their selection of the best.
Baroness Robson of Kiddington: My Lords, did I correctly understand the Minister to say that out of the 70 per cent. rejection rate, he cannot tell us which percentage relates to pure research and which percentage relates to applied research? He also referred to the amount of money put in by industry for applied research. In view of the enormous sums of money which the pharmaceutical industry has devoted to applied research, would it not be better for the Medical Research Council to concentrate on pure research?
Lord Fraser of Carmyllie: My Lords, I understand that it does concentrate in large measure on pure research. I shall try to ascertain the figure if there is a division between the two. But I certainly recognise the desirability to focus on pure research. Again I emphasise that there would be real concern if the department of which I am a Minister sought to lay down to the MRC, in contradiction of the Haldane principle, which research it should support and which it should not. I did not mention the amount of funding provided by industry which, in applied fashion, I understand amounted to something like £1.6 billion some two years ago.
Baroness Hayman: My Lords, regarding the classification and the importance of projects which are currently being rejected, is it not true that certainly in 1995–96, some alpha-plus rated projects were rejected, as were almost all of the alpha-rated projects? Is it not a matter of grave concern that in an area which has been so spectacularly successful in the past, we should now neglect for short-term savings long-term investment in the future scientific base of this country?
Lord Fraser of Carmyllie: My Lords, as I have indicated already, we have increased funding in real terms by some 30 per cent. The noble Baroness should realise that there is an increasing number of applications. I certainly understood that all the alpha-plus projects had been approved; but if I have been misled on that, I shall write to the noble Baroness to correct that understanding.
Lord Peston: My Lords, I am rather lost with all this highfalutin stuff. Does the Minister agree that the wording of the Question asked by his noble friend refers to whether HMG are satisfied, which is capable of a yes or no answer? Is he aware that I have been listening to him for 10 minutes and he has not yet been able to answer yes or no? It is a very simple Question. Are Her Majesty's Government satisfied about this state of affairs?
Lord Fraser of Carmyllie: My Lords, I have to look at the amount of money that we have spent. There has been an increase of something like 30 per cent. in real terms. If the noble Lord wishes to indicate that he would
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agree to increase it by the smallest percentage point, I have no doubt that your Lordships would be very pleased to hear that.
Lord Peston: My Lords, one of the characteristics of your Lordships' House is that I am supposed to ask the questions and the noble and learned Lord opposite is supposed to answer them. I know that that is only a temporary arrangement, but I feel that the Minister should make some effort to answer his own noble friend's Question. It is not my job to do that. I have a view; but at the moment, that is not my job.
Lord Fraser of Carmyllie: My Lords, it would clearly be very much easier for Ministers standing at the Dispatch Box to be able to say that every single application in every form which had been brought before the Medical Research Council had been funded. I am sure that the noble Lord appreciates that that is an unrealistic position. However, I can say that we have spent 30 per cent. more in real terms on medical research and I believe that to be a very fine record.

Overseas Aid: Debt Burden
2.47 p.m.
Lord Dubs Lord Dubs asked Her Majesty's Government:
What are the implications for their overseas aid and development strategy of the deliberations on multilateral debt at the most recent IMF and World Bank meetings.
The Minister of State, Foreign and Commonwealth Office (Baroness Chalker of Wallasey): My Lords, the British Government are at the forefront of discussing multilateral debt in all relevant international fora. The World Bank and the IMF have important roles in contributing to the solution. But debt relief alone is not enough. There must also be continuing economic policy reform to promote sound growth. That is essential for effective and sustainable poverty reduction strategies.
Lord Dubs: My Lords, will the Minister join me in welcoming the recent decision by the IMF and the World Bank to recognise that many countries have a debt problem which is simply not capable of being resolved? At the forthcoming spring meeting of the IMF and the World Bank, will the Government urge those two bodies to take rapid action to reduce the burden of debt on many of the poor countries?
Baroness Chalker of Wallasey: My Lords, I certainly agree with the noble Lord, Lord Dubs, that it is very welcome that the IMF and the World Bank are both now moving in the right direction with suggestions being put to the different meetings in April and the meeting of the development committee. Some shareholders still remain to be convinced of the ideas which are being advanced. We shall continue to debate and lobby for a solution to the problem of multilateral debt at the April meeting.
Lord Geddes: My Lords, does my noble friend have any news in relation to the discussions regarding replenishment of the International Development Assistance?
Baroness Chalker of Wallasey: My Lords, I am delighted to announce that today in Tokyo the negotiations on the replenishment of IDA were concluded successfully. That means that the United States will not contribute to the first year of the package, but it will clear its arrears to IDA 10 and will pledge 800 million dollars a year for the following two years. That is very good news. If we achieve the right results at the spring meetings I believe that many countries will have a much brighter future.
Lord Redesdale: My Lords, I welcome the news about IDA; I believe that it will be welcomed on all sides of the House. However, the proposals in the solutions paper apply only to eight countries. Will the Minister push for more of the 41 highly indebted countries to be included in the proposals?
Baroness Chalker of Wallasey: My Lords, I shall be very happy if we can make progress, first, with eight and then go on to deal with the remaining 33. We need to get the principles established as regards solving the problem of multilateral debt before overloading the whole system. We have made good progress as a result of the efforts of my right honourable friend the Chancellor of the Exchequer on bilateral debt; we have made some progress on commercial debt; and we now need to make real progress on multilateral debt.
Lord Clark of Kempston: My Lords, does my noble friend the Minister agree that, in the past, much of our overseas aid was misdirected and, in some recipient countries, misappropriated? Is she aware that the emphasis now on giving aid for managerial expertise is to be welcomed? Is not the increase in private investment to third world countries also to be welcomed when those countries need trade, not aid?
Baroness Chalker of Wallasey: My Lords, I can assure my noble friend that Britain's development assistance has not been misdirected. Indeed, we have been at the forefront in monitoring and evaluating our aid to ensure that it was not misdirected or misapplied. We have extended our systems to other bilateral and some multilateral donors to make sure that their assistance is not misapplied. I agree with my noble friend that the wider use of managerial experience from this country and others to put right the inabilities of civil servants and politicians alike in some developing countries is most welcome. The great increase in private investment flows to developing countries means that many are now much more able to get involved in real trade, provided that the developed countries do not bar that trade with themselves.
Lord Judd: My Lords, does the Minister accept that we on this side of the House congratulate her and her colleagues on the part they played in bringing about the replenishment of IDA? That is splendid news. Will the Minister also accept that we are full of goodwill for
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the lead which she and her colleagues are giving on debt generally? However, at the spring meetings, can she say whether the Government will give priority to ensuring that the IMF plays its part by selling some of its gold stock towards debt relief as proposed by the Chancellor of the Exchequer a year ago? Will the Government also ensure that meetings are held soon between multilateral and bilateral creditors to work out a meaningful strategy for the most severely affected countries?
Baroness Chalker of Wallasey: My Lords, the answer to the noble Lord's first two questions is, thank you. The answer to his third question is that, of course, we are going to work away at that possibility. We have to persuade other colleagues who are not yet fully convinced of the need for the sale of the gold that that is the right way to go. So far as concerns the overall plan to reduce debt and help countries to stand on their own two feet, the noble Lord knows full well that we are 100 per cent. behind that aim.

British Fishing Fleet: Decommissioning
2.53 p.m.
Lord Campbell of Croy Lord Campbell of Croy asked Her Majesty's Government:
Whether they are able to co-ordinate the rate of decommissioning of fishing boats under the United Kingdom's scheme with the numbers of newly built vessels being added to the British fishing fleet.
Lord Lucas: My Lords, the United Kingdom operates a restrictive licensing system, which means that new vessels must acquire existing entitlements to fish. Decommissioning is a voluntary scheme, the uptake of which is determined by competitive tender within the available funding. There is no link between decommissioning and new build.
Lord Campbell of Croy: My Lords, I am grateful to my noble friend the Minister for that reply. As fishing effort must be reduced to conserve fish stocks, and, accordingly, the United Kingdom, like other countries, is operating a scheme to take boats out of commission, can the tonnage of new boats coming into service be restricted by the licensing system in order to achieve overall reduction? Further, can my noble friend comment on the statement made at the weekend by the visiting EU Commissioner, Signora Bonino, that the British fleet's tonnage has doubled in the past 10 years, given that a substantial part of that increase must have been caused by Spanish boats joining the British register?
Lord Lucas: My Lords, as regards the first part of my noble friend's question, I do not believe that we have a problem in that respect. All new boats that enter the register must do so as replacements for a rather greater tonnage of boats that have left the register. Therefore, as fishermen upgrade their boats—as they continue to do in large numbers—the actual tonnage of the British fleet and its engine power will decline.

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So far as concerns the comments of Signora Bonino, I must disagree with the figures that she offered. She did not take account of the fact that a large number of vessels were not actively fishing at the time when the original figure that she quoted of 116,000 gross registered tonnes was compiled. If one looks at that in a more modern way—that is, that all boats are entitled to fish—that would increase the size of the fleet at that point. Signora Bonino quoted a current fleet of 239,000 gross registered tonnes. That is a figure that we do not recognise from any source. Indeed, our figure would be about 207,000 gross registered tonnes. The overall picture is of a UK fleet which is slowly declining but which has not declined at the rate required of it under the agreements into which we have entered.
Lord Gallacher: My Lords, can the Minister say whether the engine power of fishing vessels is taken into account in the licensing system as well as the length of the vessel and tonnage? Further, can the noble Lord say whether the engine power of foreign vessels permitted to fish in UK waters is monitored?
Lord Lucas: My Lords, I shall answer the noble Lord's second question first. Each state monitors the engine power of its own boats. We believe that the engine power is monitored in the same way as we monitor engine power; in other words, it is controlled. However, we have no way of checking the engine power of a boat at sea. We need to do a static test when it reaches port. As regards the noble Lord's first question, I can say that, yes, there are controls on engine power. If one is replacing a boat now, one has to ensure that the replacement boat has a lower tonnage and less engine power than that specified on the surrendered licence of the other boat in order to get a licence for the new boat.
Lord Dean of Beswick: My Lords, is the Minister aware that the answer he gave to the first supplementary question seems to indicate that all that is happening is that it is taking the patient longer to die? I say that because there is a progressive diminution in the tonnage available for the fishing fleet. Are the Government going to stand aside and see the fishing fleet destroyed as they have with the merchant navy?
Lord Lucas: My Lords, I do not believe that that analogy is apposite. Indeed, a better analogy would be a person who has been told to lose weight by his doctor but has not kept up with the weight reduction programme to which he agreed. However, he is losing weight and we do not believe that he will die yet.
Lady Saltoun of Abernethy: My Lords—
Lord Stoddart of Swindon: My Lords, is the Minister aware—
Noble Lords: Cross-Benches!
Lord Stoddart of Swindon: My Lords—
Noble Lords: Order!
The Lord Privy Seal (Viscount Cranborne): My Lords, I believe that I get the sense of the House that it was the turn of the Cross-Benches. We are running very short of time. I hope that the noble Lord will be patient. We must try to be as succinct as we can in order to leave enough time for the fourth Question.
Lady Saltoun of Abernethy: My Lords, in view of the importance of reducing the amount of effort in the British fleet, can the Minister say whether the Government will be willing to consider making a little more money available for decommissioning?
Lord Lucas: My Lords, we have increased the amount of money available for decommissioning. Indeed, that was announced some time ago. However, whether we shall do so further in the future is a matter which must await the results of the current decommissioning rounds.
Lord Stoddart of Swindon: My Lords, is the Minister aware that if there was any rapport between Commissioner Bonino and the fishermen of Brixham and Newlyn it was indeed over quota hopping? The Commissioner appeared to believe that there was a real problem. Judging by the Minister's reply to the original Question, he appears to believe that the Commissioner was, perhaps, wrong. I hope that the noble Lord can deny that.
Lord Lucas: No, my Lords. I hope that we are talking about different aspects of what Mrs. Bonino said. We are enormously encouraged by her acknowledgement that there is a problem over quota hopping. She has said that she thinks it can be solved through various restrictive terms applied to quotas. We are not aware of any way that this can be done but we have immediately commissioned our officials, and she has commissioned hers, to work together to see what might be possible. But the recognition that something needs to be done is something that we are grateful for.
Lord Mackie of Benshie: My Lords—
Noble Lords: Next Question!
Lord Dormand of Easington: My Lords, it is nice to know everyone is on my side!
Noble Lords: Oh!

Coal- and Gas-Fired Power Stations
3 p.m.
Lord Dormand of Easington Lord Dormand of Easington asked Her Majesty's Government:
Whether they are satisfied that there is fair competition between coal-fired power stations and gas-fired power stations.
Lord Fraser of Carmyllie: My Lords, competition is the best means of ensuring that the nation has access to secure, diverse and sustainable supplies of energy. That is why the Government established a competitive

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market in electricity generation in 1990 and an independent regulatory regime to oversee and promote competition. All licensed generators, whatever their fuel source, have access to this market.
Lord Dormand of Easington: My Lords, do not the long-term gas contracts give an unfair advantage, in that the cost of producing electricity from coal-fired power stations has been reduced significantly? Does not the Minister agree that electricity from the early gas stations which, as he will know, are almost entirely owned by the 12 regional companies, is now at a level 50 per cent. higher than that produced by coal-fired stations?
Lord Fraser of Carmyllie: My Lords, the coal producers currently have contracts which in effect guarantee the sale of significant volumes of electricity from coal plant until April 1998. From that point of view they are well favoured. But, more generally, the simple proposition is that, as regards electricity consumers, it is in their best interests and in the nation's best interests that the electricity should be produced at as cheap a price as possible.
Lord Ezra: My Lords, does the noble and learned Lord agree that the capital costs of coal-fired stations have long since been written off for the most part, and that therefore their costs of generating electricity—as the noble Lord, Lord Dormand, pointed out—are much less than for any competitive fuel source? Have those factors been fully taken into account in the present situation?
Lord Fraser of Carmyllie: Yes, my Lords, I believe they have. In the course of the past year, something like 45 per cent. of electricity was supplied from coal-fired plant. In those circumstances it would seem to me that coal is holding its position well and will undoubtedly do so until at least 1998. At some point the volume of gas, and the price at which it is available, may well be such that it will be used more widely to generate electricity. However, if that is the position, I am bound to say that I cannot see that that is undesirable if it will be cheaper and cleaner.
The Earl of Lauderdale: My Lords, in declaring an interest as a director of a company selling North Sea gas, may I ask whether my noble and learned friend is aware that coal-fired power stations are burdened by the environmental requirement of desulphurisation?
Lord Fraser of Carmyllie: Yes, my Lords, that is why I indicated that in some circumstances considerably more electricity may be generated from gas-fired plant. I have no doubt that a number of people would consider that to be highly desirable given the lesser impact it has on the environment.
Lord Mackie of Benshie: My Lords, bearing in mind the fact that during the cold spell there was widely reported to be a crisis in electricity supply, is the Minister sure that relying on private industry to build for profit will ensure the supply of electricity?
Lord Fraser of Carmyllie: Yes, my Lords. We have had a difficult winter—as the noble Lord will know was
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the case where he lives—in terms of some extreme weather. However, where there have ten interruptions to the electricity supply that was not—as I have indicated on previous occasions—because there was any significant mismatch between demand and capacity but because of extreme weather. Any circumstances where there might have been any threat to supply have been satisfactorily averted. I know There was some anxiety that in the case of gas-fired power stations with interruptible gas contracts there might be a problem, but they hold in reserve a considerable stock of gas oil. I understand there were a number of technical problems but the industry regulators are at this very moment looking into that matter to ensure that the technical problems, rather than the volumes of gas, will not be a problem in the future.
Baroness Gardner of Parkes: My Lords, is my noble and learned friend aware that before and after privatisation questions have been asked in this House about the interruption of power supply and that the replies given have indicated that there have been fewer interruptions since privatisation?
Lord Fraser of Carmyllie: My Lords, I am grateful to my noble friend for recollecting a reply that I have given on previous occasions. I have done so more than once and I decided on this occasion that it would not be necessary to repeat the point as it was so well known. Nevertheless I am grateful to my noble friend for making the point so well on my behalf.
Lord Dean of Beswick: My Lords, bearing in mind the fact that there are only two forms of energy mentioned in the Question, have the Government any proposals in the long term on what action to take since one of those sources may fail, as supplies of gas are known to be finite? What other alternatives have the Government in mind, having dismantled our coal industry?
Lord Fraser of Carmyllie: My Lords, the long-term availability of both fuels is clearly guaranteed. In the course of the past week there has been a significant and satisfactory uprating of the reserves of both oil and gas within the United Kingdom continental shelf and in terms of gas reservoirs to which we would have access beyond our continental shelf. I do not believe that there is any risk, for a long time, of either coal or gas drying up.
Lord Dubs: My Lords, the Minister just referred to a guarantee. What is the nature of the guarantee that he is talking about as regards the future use of coal in generating power?
Lord Fraser of Carmyllie: My Lords, the future of coal as a source for generating electricity will clearly depend not only on its availability but also on the price at which it is made available to those who produce electricity. I cannot believe that anyone would want to see anything other than the cheapest form of fuel being used to generate electricity for consumers in this country.

Disabled Persons and Carers (Short-term Breaks) Bill [H.L.]
3.7 p.m.
Lord Rix: My Lords, I beg to introduce a Bill to provide for assessments of health and social needs of disabled persons to include assessments of the need for short-term breaks for the disabled person and any carer. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.— (Lord Rix.)
On Question, Bill read a first time, and to be printed.

Consolidated Fund (No. 2) Bill
The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish): My Lords, I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read a second time.— (Lord Mackay of Ardbrecknish.)
Lord Eatwell: My Lords, yesterday the noble Viscount the Leader of the House staged what he described as a pre-emptive strike against his noble friends who traditionally hoped to discuss economic affairs under the heading of the Consolidated Fund Bill. I hope I may bring some solace to his noble friends by assuring them that they will have ample opportunity to expose the deficiencies of the Government's economic policies by participating in the debate which is in my name for tomorrow afternoon.
On Question, Bill read a second time.
Committee negatived; then, Standing Order 44 having been dispensed with (pursuant to Resolution of 18th March), Bill read a third time, and passed.

Sexual Offences (Amendment) Bill [H.L.]
Read a third time, and passed, and sent to the Commons.

Broadcasting Bill [H.L.]
3.10 p.m.
Read a third time.
Clause 1 [Certain events not to be shown solely on pay-per-view or subscription terms]:
The Parliamentary Under-Secretary of State, Department of National Heritage (Lord Inglewood)The Parliamentary Under-Secretary of State, Department of National Heritage (Lord Inglewood) moved Amendment No. 1:
Leave out Clause 1.
The noble Lord said: My Lords, I indicated at Report stage that the Government proposed to introduce amendments to guarantee the availability of live coverage of listed events to terrestrial free-to-air television and to provide for a number of associated
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measures to secure the best deal for sports bodies, broadcasters and the public. The amendments which I am now presenting aim to do that.
The Government's amendments go fully with the grain of the amendment passed by your Lordships' House which now stands as Clause 1 of the Bill. They build on the thinking underlying the amendment and seek to put right some specific deficiencies to which I drew attention in Committee.
In place of Clause 1, the Government propose a series of clauses to protect television coverage of listed events. Our intention is that a terrestrial free-to-air service of universal coverage should be able to broadcast a listed event live, subject only to rights being available to a non-universal broadcaster, and vice versa. Inevitably the clauses are somewhat complex. That is, I fear, inevitable if one takes action in this area. It may be helpful to the House if I briefly summarise the purpose of each amendment in turn.
Amendment No. 1 leaves out Clause 1, to be replaced by a series of clauses designed to put its general intentions into effect. We propose that these amendments constitute a new Part IVA of the Bill to follow that part which comprises amendments to the Broadcasting Act 1990.
Amendment No. 20 rolls over the provision in the 1990 Act to draw up the list of listed events as a prerequisite to the protection of television coverage. Amendment No. 21 establishes two categories of television services. The first effectively comprises terrestrial free-to-air broadcasters with universal reach. The second covers all other broadcasters. There is a power to vary the composition of each category by order, for example, to reflect the development of digital broadcasting.
Amendment No. 23 sets an absolute prohibition on any broadcaster in either category acquiring exclusive rights to show a listed event live. Amendment No. 24 provides that a contract between broadcaster and a sports rights holder must specify the category of service on which a listed event is to be televised. Both these amendments are designed to ensure compliance with the main provisions.
Amendment No. 25 is the key clause. It obliges a non-universal broadcaster not to broadcast live coverage of a listed event unless the same rights have been acquired by a universal broadcaster, and vice versa. There is a provision for the Independent Television Commission to pre-clear broadcasts which do not comply with the terms of this provision—for example, if no non-universal broadcaster is interested in acquiring relevant rights.
Amendments Nos. 26 and 27 allow the ITC to impose penalties on their licensees who act in breach of the provisions, with maximum fine levels set by the Secretary of State by order, and to report any breaches by the BBC or S4C to the Secretary of State. In practice the ITC pre-clearance procedure makes any such action extremely unlikely.
Amendment No. 28 provides for the ITC to draw up a code to specify the criteria which it will apply in exercising its functions in this area and to cover definitional issues. Other amendments with which these are grouped are consequential.
These amendments safeguard listed events for terrestrial television. They help in various ways to safeguard the position of broadcasters, sports bodies and viewers. As indicated at Report stage, the Government will keep the operation of the controls under review to reflect the need for flexibility in the fast-moving broadcasting sector. We believe that the amendments strike a fair balance between the reasonable interests of all concerned, and I hope that they will commend themselves to your Lordships' House. I beg to move.
Lord Howell: My Lords, the House will recall that at the start of our deliberations on these matters a significant majority was in favour of maintaining the listed events. With his normal helpfulness and courtesy, the Minister indicated that the Government would seek to honour that decision and produce a suitable amendment. That is what they have done today. I express my appreciation and that not only of colleagues but of the millions of people outside this Chamber who are grateful for what the House has done to protect their interest.
The new part is five pages long. I calculate that it contains more than 3,500 words. It replaces some 50 words in the 1990 Act and the provision of about equal length that we put into the Bill at an earlier stage. I do not know what conclusion to draw from this extraordinary verbosity. I can only assume that every dot and comma, nook and cranny, has been explored and that the new part is therefore totally waterproof. No doubt the Minister will tell us why we have such a lengthy amendment.
I express appreciation that the excellence of British sport is to be retained in the shop window of British sport—terrestrial television broadcasting. In view of that, we shall, of course, support the amendment moved by the Minister.
Viscount Astor: My Lords, my noble friend's amendment goes slightly further than the amendment moved at an earlier stage by the noble Lord, Lord Howell. My noble friend's amendment also refers to the list, and the revised list, and the power which the Secretary of State will have to include or omit various sporting events from that list.
When the Minister replies, will he state the Government's thinking as regards the list? How often will it be reviewed? Once a year? Or every five years? To what decisions have the Government come? It is important that we establish what the Government are providing in their amendment. It will certainly affect opinion as regards the later amendment in the name of the noble Lord, Lord Howell.
Lord Thomson of Monifieth: My Lords, the noble Viscount, Lord Astor, asks a pertinent question. We await with interest the answer from the Minister. In the meantime, from these Benches I join with the
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noble Lord, Lord Howell, in expressing our thanks to the Minister for accepting the will of your Lordships' House when we voted on the matter by ensuring that your Lordships' House and not another place put the consequences of that vote into proper statutory form.
Like the noble Lord and the noble Viscount, I have not mastered all the small print of the rather long series of new clauses, but I am sure that it is necessary. It is, however, the principle which matters. We are grateful to the Minister for enabling the House to come to a conclusion on the issue before Third Reading is completed.
Lord Peyton of Yeovil: My Lords, having had some part in the amendment moved in Committee, I should like to say more than a word of conventional thanks to my noble friend. I express genuine admiration and regard for the way in which the Minister listens to what is said here and produces something sensible to carry it forward.
I regarded the original amendment as not very good but as a useful way of nudging the Government into action. That is exactly how my noble friend has responded. For that I am most grateful.
The noble Lord, Lord Howell, is a little unkind, I think, in referring to the verbosity of the amendment. For once, I accept willingly that the step the Government have now taken demands a quite complicated series of arrangements in order to make it work. I willingly forgive my noble friend for the volume of the provision.
I should like to say how much I welcome the role that is given to the ITC under the amendment, so far as I understand it. In the rapidly changing technology of the industry, there is a great need for constant oversight by people who are detached and neutral but well informed on what is going on. My noble friend deserves the full thanks of the House and he certainly gets mine.
Lord Orr-Ewing: My Lords,I support the Government's new amendments. It is good that we have reached such an understanding. I was in favour of the first amendment of the noble Lord, Lord Howell, but the more I examined it the more I came to the conclusion that in both Houses flexibility is badly needed. Everything is changing in technology, in habits and in sport. Amateur sports are becoming professional, altering the amount of money that is available. The money available from the promoters of sport is important for the training of the new and young people both in our schools and in our classes.
I support the amendment, but I wonder whether we can keep the flexibility long enough to find that voluntary agreement which the various sporting authorities are now considering. It is important to have a voluntary agreement about how many highlights can be promoted. I also wonder whether primary legislation will be necessary if we need to change whatever agreement is reached, supposing the voluntary agreement does not work. If we need to change it, would it mean legislation on the highlights starting in another place? I note that the other place has changed the date of the Second Reading debate from just before Easter,

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on 2nd April, to 16th April. I hope that that will give them a fortnight in which to come to a voluntary agreement which we can all support.
Lord Donoughue: My Lords, we wish to join in the thanks and congratulations to the Minister for providing such a positive response. The whole process has shown the House at its best, with an excellent debate, a good vote and a positive ministerial response. I look forward to another place having to read the Bill. I wonder whether the reason for the delay is that they must read five pages of new clauses which might need a little more time.
Lord Butterfield: My Lords, perhaps I may interject a few remarks about my personal support and that of many people in the educational world for the Government's decision. I admit to an interest in the British Universities Sports Association, of which I have the privilege and honour to be chairman. Our patron is Her Royal Highness the Princess Royal. We are most anxious that at no time should television squeeze sport and similar activities off the screen. It is important that young people are given encouragement, not only to carry on their intellectual work, but also to keep fit and pursue the lions, the heroes who lead them.
At the moment the association has a remarkable hero in Jonathan Edwards who last year snatched the world triple jump record during sporting events organised by students. It is important to bear in mind that not only must the young be kept interested in their intellectual life and physical development, but also that their spiritual development is encouraged. In that respect, in Jonathan Edwards we have a modest young man who proclaimed his Christianity and on one occasion made it clear that he was not prepared to compete on the Lord's Day. If we can encourage that kind of hero through the proper use of television, it will be for the general good.
I wish to make one other remark. A gentleman in the University of Pittsburg in America, Digby Baltzell, may be known indirectly to noble Lords. He is a social philosopher in America and in his thesis he invented the great word "WASP", white Anglo-Saxon Protestant. He visited the United Kingdom while I was Vice-Chancellor of Cambridge University. I know him; he asked to talk to me and we had a chat. I was rather alarmed by the main theme that he wanted to put to me. He said that he was concerned because, returning to Britain, he found that the students were short of explicit role models. The role model that can come through the programmes that we can now see on sports and in other spheres will help British youth.
Lord Inglewood: My Lords, I begin by saying how pleased we are that the clauses that I have just proposed have met with your Lordships' approval. As the noble Lord, Lord Donoughue, said, we have had a good debate on the subject. Noble Lords were ahead of the Government in that respect, but we can now see a congruence in our thinking and I trust that it reflects well on both sides of the equation.
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We have been asked why what we propose is so wordy. The simple answer is that when the problem was looked at in detail, the technical complications entailed in bringing about what, on the face of it, is quite a simple concept mean that in order to draft a nearly watertight, rather than "waterproof', solution, which is what the noble Lord, Lord Howell, sought, requires a great deal of text. That is why we have come forward with proposals which are so long. I dare say that if it had not been for the skill of parliamentary counsel, they would have been longer still.
Finally, I was asked about our thinking on what is included in the list. I wish to emphasise at this stage that what we have focused on is establishing an appropriate framework for dealing with listed events. Getting that satisfactorily in place must logically precede consideration of what the content of the list should be. After all, we must not forget that any consideration of the contents of the list must involve a process of consultation, as set out in the 1990 Act, which is a precondition of any change which can be made administratively at any one time. It is the case that the contents of the list have been both expanded and contracted in the course of its history.
One point that has been raised is that we should establish criteria to act as a reference point for future decisions. I have made it clear that it is a useful suggestion and we shall consider it further. Clearly, that has a bearing on what might or might not be included in the list.
The Government's position on the matter is quite straightforward. We believe that it would be inappropriate to consider any proposals to add to or subtract from the list until one has finalised the framework within which the list should be drawn up.
On Question, amendment agreed to.
Lord Howell Lord Howell had given notice of his intention to move Amendment No. 2:
After Clause 1, insert the following new clause—
"UNBUNDLING" OF SPORTS BROADCASTING RIGHTS
(".—(1) This section applies where a person acquires the exclusive rights for the live television broadcast of any sporting event to be included in any service provided by—

(a) any holder of a licence under Part I of the Broadcasting Act 1990;

(b) any holder of a digital programme licence under Part II of this Act;

(c) the BBC; or

(d) the Welsh Authority.

(2) The Independent Television Commission ("the Commission") shall ensure that no broadcast to which subsection (1) applies shall be included in any service to which subsection (1)(a) or (b) applies unless—

(a) in the case of a subscription or pay-per-view service, the right to broadcast television highlights of that event, at a reasonable time after the conclusion of the event on the same day as the event taking place, has been offered on reasonable terms to a universal broadcaster (whether or not the same person as the provider of the subscription or pay-per-view service), or

(b) in the case of a universal broadcasting service, the right to broadcast television highlights of that event, at a reasonable time after the conclusion of the event on the

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same day as the event taking place, has been offered on reasonable terms to a person offering a pay-per-view or subscription service (whether or not the same person as the universal broadcaster).

(3) The BBC and the Welsh Authority shall ensure that no broadcast to which subsection (1) refers shall be included in any television service broadcast by them unless—

(a) in the case of a subscription or pay-per-view service, the right to broadcast television highlights of that event, at a reasonable time after the conclusion of the event on the same day as the event taking place, has been offered on reasonable terms to a universal broadcaster (whether or not the same person as the provider of the subscription or pay-per-view service), or

(b) in the case of a universal broadcast service, the right to broadcast television highlights of that event, at a reasonable time after the conclusion of the event on the same day as the event taking place, has been offered on reasonable terms to a person offering a pay-per-view or subscription service (whether or not the same person as the universal broadcaster).

(4) If the provisions of subsections (2) and (3) are not complied with any person referred to in subsection (1)(a) to (d) may refer the matter to the Director General of Fair Trading who shall determine the terms on which the rights referred to in subsection (1) or any of them are to be licensed.
(5) The Commission, the BBC and the Welsh Authority, as the case may be, shall ensure that no person referred to in subsection (1)(a) to (d)—

(a) acquires rights to sporting events which he cannot exercise, or

(b) retains rights to such events which he does not intend to exercise.

(6) In this section—
"television highlights" means recorded extracts of the coverage of a whole sporting event, such selection to be by the universal broadcaster for the purposes of subsection (2)(a) and (3)(a) and by the person offering a subscription or a pay-per-view service for the purposes of subsection (2)(b) and (3)(b);
"universal broadcasting service" means a service received or delivered to more than 90 per cent. in aggregate of all households in the area appropriate to the sporting event, and "universal broadcaster" shall be construed accordingly.").
The noble Lord said: My Lords, for the reasons which I shall give in moving Amendment No. 3, I shall not move Amendment No. 2.
[Amendment No. 2 not moved.]
Lord Howell Lord Howell moved Amendment No. 3:
After Clause 1, insert the following new clause—
BROADCASTING SPORTS RIGHTS: SPORTS COUNCIL CODE
(" .—(1) It shall be the duty of the Sports Council to draw up and keep under review a code giving guidance to the Commission, the BBC and the Welsh Authority as to the carrying out of their duties under section ("Unbundling" of sports broadcasting rights).
(2) In carrying out their duties under section ("Unbundling" of sports broadcasting rights) the Commission, the BBC and the Welsh Authority shall have regard to the code mentioned in subsection (1).
(3) The Sports Council shall lay before both Houses of Parliament an annual report on the extent to which the code has been complied with.").
The noble Lord said: My Lords, Amendment No. 3 deals with the difficult subject of whatever is left, the other sports not included on the list of events. Those sports are important. They include such events as the Rugby Union Five Nations Championship, motor
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racing, open golf, Ryder Cup golf, Royal Ascot, Cheltenham racing and so on. We have to consider the rights of the public to see those events should the governing bodies of those sports wish to dispose of them exclusively to one television channel, which might not, as is the case with Sky, be happy to provide highlights to other channels.
No doubt, like me, noble Lords are a little weary with the constant cross-communications we have all received in recent times, from the sports bodies on the one hand and the television authorities on the other. They show the importance of the subject. This amendment is an alternative means of tackling the problem, as distinct from the purely statutory manner in which we have dealt with listed events.
Subsection (1) of the amendment states that it will be the duty of the Sports Council to draw up a voluntary code of conduct on the question of highlights. Secondly, the amendment requires the relevant regulating bodies to have regard to that code when performing their duties under the Act. Thirdly, it requires the Sports Council to report annually on how far the code has been complied with.
I have had the advantage of seeing the proposals which I believe the Sports Council has delivered to the Government by way of a first draft of its code. It seems to me that they go a long way—if it is possible to bring them off—towards meeting some of our fears. The draft does not go the whole way, for reasons I shall return to in a moment, but it certainly goes a long way.
I am told that the television companies have indicated to the Sports Council the likelihood that they will support such a code. I know that some sports—including, as I particularly appreciate, my own sport, football—have tried to be extremely helpful. The Sports Council is confident that it can, in a reasonable time, get all the major sports we refer to to sign up to the code.
The noble Lord, Lord Orr-Ewing, made a point a moment ago with which I entirely agree. We cannot have a voluntary code of conduct if we believe it might be undermined in any way. That is one of the reasons we seek to have statutory backup in this amendment: to say, for example, that the Sports Council has to report annually to Parliament, in case anyone wishes to break the code having once entered into it, be it sport or television, and also to call upon the regulatory bodies to have regard to the code when issuing licences.
The noble Lord, Lord Orr-Ewing, is quite right. There are effectively four to six weeks, perhaps more, before the Committee stage of this Bill is taken in another place. My judgment is that the Sports Council ought to be able to produce a code by then. We have to take that on trust. I take it on trust. I know that the council will do its utmost. The chairman and director of the Sports Council and their senior officers have worked ceaselessly, especially in the past seven days, to try to bring us to this situation and avoid further confrontation. The House may therefore feel that they should he supported and be allowed to produce a voluntary code if they can do so. That is certainly the view to which I am inclined.
However, there are difficulties in this area. Hardly a day goes by when I am not told one thing by some of those parties which is contradicted the next. That makes it very difficult to reach agreement with anybody. For example, last week I was told that the copyright provision which would allow access to highlights from the Bruno/Tyson fight had all been settled and solved and there would be no difficulty at all; they would all appear. But the very day after I was told that by the appropriate television company, it issued another statement saying that it would not allow the BBC to show the actual knock-out if one occurred. That seemed odd to me, since in my judgment there almost certainly would be a knock-out. There are difficulties. People say one thing one day, no doubt in good faith, and then are under all sorts of pressures to change their stance the next. I concede that that makes it very difficult for the Government, as well as for us and for the Sports Council.
I am glad that the Minister mentioned in his earlier remarks the question of extended listed events. There is not the slightest doubt that, unless we can get some sensible agreement about highlights and the right of the public to see them, there will be a great demand to extend the number of listed events. We cannot have a situation in which 33 million households, or even more, may suddenly be deprived of any sight of the major sporting events in this country outside the listed events. That would cause enormous difficulties and problems throughout the land. So one of the reasons for supporting our approach today is to prevent the need to add to the listed events. There would certainly be a movement towards that in another place if the code of conduct has not come into operation. I hope that the voluntary sports bodies will remember that.
I shall deal with two of the objections with which we have all been flooded. The major spectator sports division of the Central Council for Physical Recreation—spectator sports are the great sports of our nation—wrote to me, and I suspect to other noble Lords, in terms which suggest to me that its intellectual capacity seems to be withering. It says, for example, that we have to have regard to the effect of our measures on husky racing, sheepdog trials and darts—none of which I regard as sports, and so far as I know they are not affiliated to the Central Council for Physical Recreation.
Mr. David Elstein, of Sky, has gone even further. He says, that we have to have regard to topless darts. I do not think that sport is affiliated to the CCPR, but if it does become affiliated, since I attend all the conferences, I look forward to exhibitions of what is involved in that activity. The mind boggles. When representatives of major sports and Sky Television tell us that we have to have regard to husky racing, sheepdog trials and topless darts, I wonder where on earth we are, and whether these protagonists are all quite right in the mind.
I turn to the competition argument, which is important. It has to be met and dealt with in just a moment or two. The major spectator sports tell us that sport has a right to sell its wares to the highest bidder.
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So it does, and we have protected that right in our amendments and in our legislation. We are not trying to undermine the right of sport to sell what it can.
Perhaps I may illustrate the position by reference to one sport. If it wants to sell its products to Sky Television for exclusive use, under these proposals it must separate the negotiations for the highlights. That means in practice that if the rights are sold to Sky the governing bodies of important spectator sports will then have to negotiate the highlights with the BBC, Independent Television or Channel 5. If that is opposed, it seems to me that what the spectator sports are saying is, "We don't have any confidence in our ability as negotiators in the marketplace to get a fair deal, even though there are three television companies with which to negotiate".
Let me illustrate the effect. The House will recall, when we discussed earlier the world cricket championships (we congratulate Sri Lanka on its astonishing victory in that competition), at the start, no highlights were to be made available to the BBC. After discussion in this House, highlights were made available and the BBC paid £1 million for them. It is quite ludicrous that the BBC should pay £1 million for the highlights of world cricket when it could have paid £1 million to the cricket authorities themselves. As suggested in the amendment, the cricket authorities could negotiate directly with the BBC and the other two companies. I wish that the marketing men would have confidence in their ability to negotiate properly.
I say again to the governing bodies of sport that not once in any of the letters that I have received this week have they answered the point that we repeatedly made; namely, that they should face up to their social responsibilities as sports bodies. As well as earning as much money as they can for the sport, quite rightly, they have a duty to millions of sports lovers who cannot afford to watch Sky, especially those in infirmity or old age. They should be allowed to watch excellence in their living rooms, as indeed should the young. The sports bodies will undermine their own future if they acquiesce in taking out of the living rooms of most houses in this country excellence in sport through the terrestrial broadcasting which is currently available to them.
There is another financial argument to consider. At the moment the Test and County Cricket Board feels aggrieved because it has 30 days of test cricket. It feels that it can get more money from Mr. Murdoch, if it negotiates with him, than out of the BBC. I myself heard the chairman of the Institute of Sports Sponsorship say, "Don't think that if you go to the minority audience on Sky you will take our sponsorship with you. The value of our sponsorship and the value of all the perimeter boards around the grounds when seen on BBC for 30 days is something that money cannot buy". That is the other part of the economic and financial argument and it is often left out of the equation by the sporting bodies. It is our duty to remind them of that.
I regret their repeated silence in not answering the question: how do you intend to fulfil your social responsibilities? How do you intend to look after those who cannot receive the television programmes in their home? There is great silence on those matters.
There is silence in other quarters. We rightly pay tribute to the Minister in this House, the noble Lord, Lord Inglewood. Perhaps noble Lords, like me, have felt it extraordinary that over the months of argument about this matter, which is probably the most important matter concerning sport that is before Parliament or the nation, not one word has been heard from the Minister for Sport, Mr. Iain Sproat. There has not been one word from him during all the months that we have been conducting the negotiations. Where is that mystery Minister? Is he about anywhere? Will he emerge at any time to give us the benefit of his leadership? He should have been doing that a long time ago.
I am prepared to take the Sports Council's voluntary code on trust, if the Minister intends to give us reasonable news, as I hope he might do; namely, the assurances that the Sports Council will be given every encouragement to produce such a code. I hope we can be assured that the sports bodies will play their part, as will the television companies. It is now time for the Sports Council to produce such a voluntary code. This amendment is designed to allow the Minister to encourage it and tell us in detail how it will work. It also takes regard of the fact that, when we have a voluntary code, should any of the participants wish to withdraw after Parliament has given the code its blessing, then the other place, having taken careful note of that, might have no alternative but recourse to further statutory measures. That ought not to be necessary with the good will of the major voluntary sports bodies in this country, supported by the Government and by the Sports Council. I hope so.
I look forward to the Minister's response. I beg to move.
3.45 p.m.
Lord Thomson of Monifieth: My Lords, I find myself in some difficulty in speaking to the amendment. The noble Lord, Lord Howell, is a doughty champion of the interests of the general public in British sport. I have always been content to defer to his judgment. At his request, mine is the second name on his two amendments on the Marshalled List. I did not learn from the noble Lord, Lord Howell, that he proposed not to move the first amendment. I knew that he had reservations as to whether it was wise to ask your Lordships' House to come to a view on it. I feel that there should have been rather more adequate consultation on these matters.
We are now asked by the noble Lord to abandon any idea of having some statutory back-up for so-called "unbundling", enabling the general public to have the right to see the highlights of sporting events when the exclusive live rights have been bought for subscription. He prefers to go for a voluntary code. At this moment I do not quite know what the noble Lord means by a voluntary code. I have glanced at a piece of paper that I found just now on this Bench. It seems a rather vapid arid general document. For my part, I prefer to stick to the views on which the amendments were formed; namely, the need for some kind of statutory underpinning and then, no doubt, the advantage of an effective voluntary code.
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There is here a matter of procedure which I do not quite understand. Amendment No. 3 on the Marshalled List asks the Sports Council:
"to … keep under review a code giving guidance to the Commission, the BBC and the Welsh Authority as to the carrying out of their duties under section (`Unbundling' of sports broadcasting rights)".
There is no such section now. The amendment goes on to say:
"In carrying out their duties under [this] section … the Commission, the BBC and the Welsh Authority shall have regard to the code".
The amendment is meaningless as argued by the noble Lord. I do not know what the Opposition generally or the Labour Front Bench will do, but I propose to argue our considered case on this matter. We remain of the view that there should be some statutory underpinning, even though it may be reinforced by a voluntary code of conduct. If duties are to be placed on the Independent Television Commission and the BBC, they ought to be spelt out in legislation and not put forward in this rather curious way in terms of a proposed voluntary code that none of us have had the opportunity to study.
Behind the amendments as they stand is an underlying situation of legitimate conflicting interests in the sporting field. Those interests are in many ways locked in a conflict as dramatic as the Bruno-Tyson fight. Mr. David Elstein of Sky Sport and Will Wyatt of the BBC are more evenly matched than Bruno and Tyson; but they are in conflict with each other.
I do not take sides one way or the other. The reason we on these Benches feel that a statutory power is required is that our interests—they should also be the Government's interests—are those of the ordinary viewer and listener. I fully recognise that even the interests Of the ordinary viewer and listener in regard to sporting events beyond the listed events are not straightforward. There is an important minority of viewers—of whom I am one—who want much more sport than is practical on the four terrestrial channels and are prepared to pay for it, even at 3 o'clock in the morning, although my sporting enthusiasm does not extend that far. There is probably a bigger minority of viewers who feel that there is too much sport on public service channels and believe that more should be shunted onto subscription.
However, we are concerned with what I believe to be the middle mass of viewers, some of whom are not able to pay a subscription and who feel that they should have a fair share of the most interesting sporting events; that they should be able to enjoy live coverage of the special national occasions which come under the listed events—we welcome the Government's decision in that respect—but who feel also that they should enjoy a decent view on the day of the highlights of other important events. That seems to us to be a public interest that the Government should try to secure. What the debate in your Lordships' House has done is to provide evidence that the market place is not enough. I remain to be convinced that a code of conduct of the kind described in the amendment will be enough.
There has been the rather farcical wrangle over whether ordinary terrestrial viewers should he allowed by Sky Television, which was in total control, to see the

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final punch of the Bruno-Tyson fight; and at what time they should see it, the next morning or 48 hours later. An operator like Sky has a powerful financial incentive right up to the last minute to persuade viewers that the only way they can obtain even a glimpse of the great sporting event is to sign up and pay for it. Some holders of sporting rights are tempted to take the short-term view that more money and fewer viewers is in their best interests. There seems therefore to be a need for some degree of public control in the interests of viewers and, although I am a strong supporter in general of self-regulation, there are cases where it needs to be reinforced by some statutory backing.
We have talked mainly about viewers. What about listeners? They tend to be overlooked. There is not and cannot be—thank goodness! —subscription radio. Nobody can operate a "pay-per-listen" service on the old steam radio. But a satellite operator like Sky, without radio facilities of its own, can and does buy up the exclusive radio rights as part of a total package. It is then in a position to hold the public service radio channels to ransom for the live radio rights. BBC's Radio 5 Live, which does so well in providing live radio commentary of sporting events, finds itself from time to time in that situation. For instance, with only three months to go to the start of the cricket World Cup, the BBC discovered that the full broadcast rights, including radio rights, were held by Sky. It had been in negotiations with the original holders of the rights in India for over a year and it was not until the deal was closed with Sky that the BBC was informed that the whole package, radio as well as television rights, was being sold to Sky. Over the three months of negotiations with Sky, the rights holders did not volunteer the knowledge that they were in negotiation with Sky and the price was going up and up. It was only the extreme pressure of the debate in your Lordships' House and impending legislative change that finally forced Sky to agree a deal just one week in advance of commencement and at a price double that paid for the last cricket World Cup.
There is a question looming over Rugby Union. I understand that the BBC is currently negotiating with the RFU for the radio rights for the 1997–98 tour. But there is a possibility that Sky will again go for full broadcast rights, including radio that it does not itself operate, so making radio suffer in terms of obtaining the rights agreed. That is extremely unsatisfactory from the public interest point of view. A satellite broadcaster like Sky can delay a deal until the last minute to prevent the radio channel giving advance publicity and thereby create the impression to the rest of us that if we are anxious to partake of the live broadcast in one form or another of a specific sporting event the only way we can do so will be on subscription TV. That is an abuse of a dominating situation. Until this afternoon, on the basis of the amendments tabled on the Marshalled List, I assumed that that was the general view of the Opposition. We felt that it was necessary, along with a code of conduct, to have reinforcement of statutory rights. I am sorry to have to say to the noble Lord,
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Lord Howell, to whose judgment in these matters I normally defer, that I remain unconvinced by what he said; that is, that a code of conduct by itself is adequate.
Viscount Astor: My Lords, the noble Lord, Lord Thomson, made a powerful speech in favour of statutory regulation. But that is not what the amendment is about. The noble Lord's speech related to the previous amendment; we must be clear on that.
Lord Thomson of Monifieth: My Lords, I am not sure what the rules of order are in this situation, but perhaps the noble Viscount will allow me to interrupt. If I had dreamt for one moment that the first amendment was being withdrawn without consultation, I would have objected.
Viscount Astor: My Lords, I understand what the noble Lord says. All I am seeking to do is to put the argument in context. It is important that we look at the amendment as it stands. I agree with the noble Lord, Lord Thomson, that it does not stand on its own.
The amendment talks about the Sports Council drawing up and keeping a code for the,
"'Unbundling' of sports broadcasting rights".
That is what the amendment says. The problem with the amendment, very simply, is that the Sports Council does not represent all sports. After all, we can all discuss what is sport. To me, racing is sport and I regard most of the rest as games. Of course, I accept that not all of your Lordships might agree with that scenario, but what is entirely clear is that the Sports Council does not represent racing and it does not represent motor racing. Those are both sports and they would be affected. The amendment cannot be right because it will bring the Sports Council into areas of which it has absolutely no experience and with which it has had absolutely nothing to do. That must be wrong.
There has been, I understand, a voluntary code which is either agreed or is about to be agreed. I am sure that my noble friend the Minister will have something to say on that. We should listen very carefully. I agree with much of what the noble Lord, Lord Thomson of Monifieth, said. In particular, I agree that the amendment cannot stand on its own. I believe that the amendment would be damaging to sport.
4 p.m.
Lord Shepherd: My Lords, perhaps I may ask the Minister whether he can help many of us who have a great interest in this particular subject. The noble Viscount, Lord Astor, believes that the amendment is imperfect, but so was the very important amendment which we all agreed in Committee. Because the Government have responded, in the end the House has obtained what it had been looking for, despite the imperfections of the amendment.
I understand in this respect that there is a question of whether there is a statutory code of practice or a voluntary code of practice. My noble friend has moved an amendment proposing a statutory code of practice, but I gather that there were rumours floating around the House during the morning that the

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Government were able to make a statement which may be helpful to those who have anxieties. Therefore, I wonder whether the Minister—since he has a right to speak, and also, if necessary at the conclusion of our debate, to wind up—can tell us what, in fact, the Government have in mind. I see no point in having a great debate only to find that what we are talking about has already been considered and acceded to by the Government. I suggest to the Minister, if that is the wish of the House, that he should tell us what offering, big or small, the Government are willing to make in regard to the issue raised by my noble friend. It is far better to have a debate on a subject we know something about, rather than having a debate that could be largely airy-fairy. So, if the noble Lord is willing to take my words as the spirit of the House, perhaps he will enlighten us as to what is the Government's position.
Lord Inglewood: My Lords, with the leave of the House, I shall willingly respond to the noble Lord, Lord Shepherd. Without wishing to give the entire remarks that I had intended to deliver at the conclusion of this part of the debate, it may be helpful to spell out where I believe we are on this subject now.
The Sports Council has advocated a voluntary code of conduct for governing bodies on unbundling and is discussing this with sports' governing bodies. The Government, along with other noble Lords, have welcomed that idea in principle, because we believe that a voluntary code offers to provide greater access to sport for the public on television and is the best way forward in this particular area.
As the noble Lord, Lord Howell, intimated in his remarks, good progress is being made in preparing the voluntary code which the Sports Council has proposed and which has already been referred to. A draft for discussion has been issued and I understand that the main governing bodies of sport are already discussing what it might say with the Sports Council. My honourable friend the Minister for Sport, to whom the noble Lord, Lord Howell, referred rather by his absence earlier in this afternoon's proceedings, has had a meeting about it with the Central Council for Physical Recreation and with the major sports' governing bodies.
The Government's view is that a voluntary code is the right way to proceed with this matter. We are encouraging the various parties involved to draw up such a code, and meetings are currently taking place to that end although at the moment no conclusion has been reached. However, that process is still under way and I am advised that there is no reason to suppose that a successful outcome will not be achieved.
Lord Renton: My Lords, before my noble friend sits down, I wonder if he would care to mention to your Lordships the purely technical point that Amendment No. 3 cannot possibly be accepted. It makes a nonsense without Amendment No. 2 having been moved, because subsection (1) of Amendment No. 3 refers, in effect, to Amendment No. 2.
Lord Barnett: My Lords, perhaps I may make this one point. It was suggested that this is a voluntary code but, as I read the amendment, if it is accepted by the Minister, it would be a statutory duty written into the Act, would it not? It is a statutory duty of the Sports Council to draw up and keep under review a code. That must be, in the legislation, a statutory duty. Perhaps he will correct me if I am wrong.
Lord Inglewood: My Lords, with the leave of the House perhaps I may respond to those two points. First, with respect to the remarks of my noble friend Lord Renton, of course, my noble friend is right. On the other hand, I was anxious that we discuss the substance behind the amendment because that is a matter of wide interest to your Lordships.
The noble Lord, Lord Barnett, is absolutely correct that the amendment which is being discussed refers to a code which is enshrined in statute. That is a proposition which the Government do not consider to be the right way forward, because we believe that the right way is to have a voluntary code agreed by the various parties concerned. I hope that that clarifies the position.
Baroness Rawlings: My Lords, perhaps I may return to the substance of the debate. I, like many of your Lordships, have received an enormous amount of briefings at every stage of this Bill, but more on this one amendment than on any other aspect. I have read them with great care, as it is an extremely complicated subject, especially for the layman.
I have no declaration of interest to make, and hold no brief for either side of the debate. My nearest interest would be my great admiration for many years for the BBC World Service, but I feel that sports—or, as my noble friend Lord Astor, calls them, sport and games—play an important role in many people's lives.
The amendment, on the face of it, looks very attractive, yet it has many anomalies. It would be wrong to take into account only the viewers and listeners and not all the people who are involved in sport. We have a fine tradition of the highest class in all sports and in sportsmanship in Britain. Alas, today, we are no longer the major winners, but merely showing more sport on television is not instantly going to produce gold medallists or cup winners. We all know that there is much more to world class winners than that.
I have always believed that sport is vital for youth. It encourages a good, healthy, competitive spirit and, more often than not, keeps the mind and the body out of trouble. I would encourage more sport in schools as part of the curriculum, with more funds made available for facilities.
In Raising the Game, my right honourable friend the Prime Minister said that sport enriches the lives of thousands and millions of people of all ages around the world, who know and enjoy it. It cannot be true that if we continue to have some major events on satellite or cable the vast majority of viewers could soon be unable to see any coverage of sporting events that are able to inspire and unite the nation.

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The amendment, as it stands, is muddled and will, as a result, only bring unhappiness. Differences between sports are not provided for. Surely, there would be very few people who would pay extra for highlights when they could see the live broadcast for only the annual TV licence. After all, if you cannot watch it live you can always video it.
The current situation where broadcasters are freely able to bid for rights of both live coverage and highlights is in the best interests of both viewers and sports bodies. There are many programmes covering sport on both terrestrial and satellite, but let us get this into the right perspective. Perhaps I may quote a few figures. The top three television programmes last week were: "Coronation Street", "Coronation Street" and "Coronation Street". The viewing figures were 19.57 million, 18.55 million and 18.44 million. The top sporting programme, "The Match Live", came 36th on the list with 9.11 million.
Many of us would ideally like sport to be all amateur again with the great gamesmanship that was shown in the past and broadcast regularly on our BBC. This might even attract those 19 million viewers. We were perhaps the last to have the great amateur sportsmen in the Olympics with those outstanding skiers like the Palmer-Tomkinsons and Gina Hawthorne. Those days are over. We must face reality. Today a great amount of money is involved. The amendment has potentially disastrous financial consequences for all sport in Britain. What right do we have as legislators to deny people the right to sell a legitimate product? I congratulate my noble friend the Minister on his broadminded approach to this highly complex Bill. The system that we have at the moment, which is freely negotiated, with a voluntary code of practice and with no statutory interference, is surely right. I would urge your Lordships not to support the amendment.
Viscount Caldecote: My Lords, before the Minister replies, this issue of unbundling is of importance, as I am sure the whole House agrees. Can he say what will happen if the voluntary code of practice—in general, I am in favour of voluntary codes—seems to be unsatisfactory and is not working? Will it then be possible, without more primary legislation, to come to a statutory code? What is the position on that?
Lord Campbell of Alloway: My Lords, much the same thought has been worrying me. Under Amendment No. 3 there is no code having legal efficacy. It is a code of guidance. The only statutory duty is on the Sports Council to draw it up. As my noble friend Lord Astor has pointed out, the Sports Council does not have a remit over many things which my noble friend and I consider sport. But I shall leave that aside for a moment. If this code is a code of guidance—this amendment says that it is—it will have no legal efficacy at all. That was the point being made by my noble friend Lord Caldecote. If it does not work, what will happen? This is an experiment and all that can happen is that one will have to come back to primary legislation.
Lord McNally: My Lords, there is an old saying that sometimes you can be so sharp that you will cut yourself. I have the feeling that having got one part right—the protected list—by a full debate of this House and considered thoughts by the Minister and then amendments to the Bill, we have not done very well with the unbundled list. There is a great danger, as the noble Lord has just said, that the unbundling of television rights will be botched as the House has not had proper time to consider the full implications of what has been put before it in this last minute way.
As a number of noble Lords have pointed out, one does not get that many bites at legislation. If we take this pig in a poke of a voluntary scheme and it does not work, what will be the protection for sports and viewers? Who is putting this together for us? —sports bodies, which, as the noble Lord, Lord Howell, said, have shown themselves to be failures in accepting their social responsibilities in guarding their sport and negotiating on television rights, and the television companies. If one reads Mr. Elstein in the Guardian and elsewhere one sees that he is still bent on all-out war with the rest of television so far as concerns sporting rights. Who will bring these bodies together with the wisdom of Solomon? —none other than Mr. Iain Sproat, the Minister of whom the noble Lord, Lord Howell, spoke so warmly. It does not fill me with the same confidence as the procedure we followed when we had that magnificent debate on the protected list. The Minister went away and came back with considered amendments and wrote protection into the statute. This House would he well advised to go no further with this because we are heading for a botch-up.
4.15 p.m.
Lord Dixon-Smith: My Lords, I find myself becoming a trifle confused about where we are. The House has certainly had the opportunity to have a full debate on this issue and I do not think we can run away with the excuse that we have not. There was certainly no objection when the noble Lord, Lord Howell, decided not to move his amendment. Therefore, it seems to me that the speech we have just heard and the one that we had from the noble Lord, Lord Thomson of Monifieth—I hope he will forgive me for saying this—are what I would call the equivalent of the highlights of rounds four to 12 of the Bruno-Tyson fight, because they are after the event and are therefore best left.
Perhaps I may come back to the amendment proposed by the noble Lord, Lord Howell. During the course of his remarks he said that he was prepared to leave the matter to voluntary agreement. If he is prepared so to do, it seems to me that we do not need the amendment anyway. We have heard from the Minister that he is well disposed to the issue of voluntary agreement and that this is in fact the proper way to decide it. I would rather like to hear what the Minister has to say in winding up and I hope very much that after that the noble Lord, Lord Howell, will find it possible to withdraw his amendment.
Lord Donoughue: My Lords, we find ourselves in a slight procedural pickle because it is clear that Amendment No. 3 depends on Amendment No. 2 and

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Amendment No. 2 is not moved. So perhaps I may at the beginning apologise—I know that my noble friend Lord Howell would like to apologise—to the noble Lord, Lord Thomson, and in a way to the House. However, we can clear things up. We on this side shall not be voting on this amendment because that would add confusion to wherever we are. But I should point out to those opposite who are smiling that this is not the end of the story.
The Bill now goes to another place and today there is still an opportunity for this House, as the noble Lord, Lord Thomson, has done and as my noble friend did, to make the arguments to the Minister as we move towards the conclusion of this story. The case for protecting highlights, as has already been put and as is secured in the amendments on paper, remains overwhelming. It is a logical extension of Clause 1 which was based on the overwhelming view of this House. The Government have commendably accepted that clause and so logically should accept the spirit and thrust of what is being said on the highlights.
What we have before us, although it is of a rather ill-defined shape, is the Government's compromise proposal—the voluntary code. That is fine. The amendment on paper supports that principle. However, there are problems. Will it actually happen? Will it stick? We know that the problem with voluntary codes is that participants can voluntarily leave them.
This code, so far as I have studied it, involves some sports bodies who are clearly reluctant to be part of it; they prefer the short-term money, as they see it. It involves at least one broadcaster who is not enthusiastic about it. So this is not a secure vessel. At this stage we have to—if we do—take it on trust. I am not sure we can do that. My noble friend Lord Howell, who is always a much more trusting man than I am, inclines to that.
Perhaps I may tell the House what our fear is. It is that those who are part of this voluntary code and who do not really want it will use it as a device to divert us from today's vote—although they do not need to do so because we have our own devices—and to delay it until the threat of statutory backing is past and then, when what they see as the parliamentary danger is over, pull out.
The code is based on the Sports Council. As an ex-member I am very sympathetic towards that body. But we must bear in mind that it is a fragile one. As the noble Viscount, Lord Astor, said, it does not represent all sports and has little power over many, and none over television. I suspect that knowing that it is a fragile vessel the Sports Council, or some of its more responsible members, will welcome the kind of statutory backing suggested in Amendment No. 3 because it gives them clout over the constituent members. That is our thinking on the amendment. It is not an amendment of government interference but leaves the negotiations and the detail to the sports industry and gives the Sports Council statutory backing.
The Government have been a main engine of the voluntary compromise. The Minister has said and, I am sure, will say again, that as far as he and the Government are concerned the voluntary code is going
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to happen. I hope that that is true. If it falls apart responsibility will lie with the Government as well as with the Sports Council and the sporting bodies because it would have been perfectly possible for us to sit down with the Government and agree a clause of the kind set out in Amendment No. 3, based on a voluntary code but with statutory backing. I believe that we could have achieved that together and that the House would have accepted it and been happy with it.
Amendment No. 3 would have secured that statutory backing and I believe that a majority of the House would have supported it. Now we shall not have it. I say to the Government and to the sporting bodies that they must make sure that the voluntary code happens and sticks before the Committee stage in the other place because I believe that Parliament will not tolerate it not happening. The public want the highlights protected. I believe that a majority of this House also want that and indeed the majority of Parliament. If anyone disrupts the voluntary code and treats it cynically as a way of bypassing Parliament, there is one logical conclusion to be drawn.
If we do not have highlights we must have a longer protected list. That is the reality which the sports bodies have to face. And it is why they really must work as enthusiastically as possible to get it in place. The alternative in due course will not be that choice but a longer protected list. We sincerely hope that the sports bodies and the Government will produce a voluntary code that sticks. It is on that basis that I shall listen very seriously to what the Minister has to say about how this whole business goes forward.
Lord Inglewood: My Lords, perhaps I may preface my remarks by saying that we believe that television should provide widespread access to different sports. It is an aspiration of policy that we have. But we differ from those on the Benches opposite over whether that aspiration should be given effect by statutory or voluntary means.
I explained where the Government stand on the issue and the position I believe the negotiations have reached. In that context I pick up a point made by my noble friend Lord Caldecote and echoed by the noble Lords, Lord McNally and Lord Donoughue. In bringing forward a voluntary code we cannot wait indefinitely. It is important that what is agreed is available for Parliament to look at.
The approach that we have adopted I wish to explain in some detail. We believe that our approach is consistent with the basic policy which is wanted on all sides of your Lordships' House. There is an issue about highlights of major national and other events, which are not listed and quite properly so. It is desirable that coverage should be made available but it should he done in a sensible and practical way which works with the market and does not cut across it. It should be done in a way which recognises that there is only a limited amount of time available for sports programmes on terrestrial television. It should be done in a way which recognises that there are limits to the public interest argument, perhaps even to the public wish to watch sports which would be covered by the amendment we

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are considering. Above all, it must be done in a way which allows a balance to be struck between revenue, coverage and investment in the future of the game in question.
We believe—and I think many noble Lords share this view—that the sports should be given the opportunity to show, through a voluntary code, how they will strike a balance and how they will invest television revenues in improved performance and greater spectator safety and comfort.
We believe that the approach which lies behind the amendment is likely to hinder rather than assist the Sports Council in its present efforts. The strength of the voluntary approach is that it is freely and willingly entered into and does not require the sort of unparalleled and novel intrusion into property rights which we believe is unjustified in the present circumstances. This is an important point when considering how everybody must work together to give effect to the ideas that we are debating. It is the Government's belief that to oblige the Sports Council through statute to draw up a statutory code is unhelpful. We also believe that the approach inherent in the amendment is likely to confuse rather than clarify responsibilities. That point was touched on by my noble friend Lord Astor. Essentially, we are being asked to agree that one public body should have no choice but to draw up guidance for another public body on how to regulate the broadcasting industry on unbundling sports rights. The rights holders themselves seem to be left somewhere outside all this advice and guidance although, after all, at the end of the day it is their rights which are under consideration.
The Sports Council was never intended or equipped by its charter, or at any subsequent stage in its history, to be a body responsible for giving guidance to broadcasting regulators. The Sports Council undertakes a central role in promoting sport in this country. We believe that it can effectively, sympathetically and appropriately encourage and guide co-operation among sports governing bodies. But having a quite different duty of this kind imposed on it would entirely change its nature which would only weaken its ability to carry out its core remit and its relationship with government.
Furthermore, it seems to us that the approach suggested by the noble Lord, Lord Howell, in his amendment perhaps paradoxically risks the perverse effect of actually prejudicing the prospect of securing a voluntary code which, as I have explained, is the approach that we believe to be right. It would inevitably lead to sports bodies focusing their energies on campaigning against those draconian provisions rather than working constructively with the Sports Council and the broadcasters on an agreement to secure their mutual interests and to provide benefits for viewers. I accept the remarks that have been made about the need for clarity in this respect and that there must be no potential for obfuscation and brinkmanship in the arrangements that emerge.
I think that all concerned have taken careful note of the interests of Parliament in this issue, not least in the comments made in your Lordships' House today. Indeed, they echo some remarks made by my noble friend Lord
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Harrowby at Report stage which I sense conveyed the sentiments of the whole House. No doubt the other place will keep the progress of negotiations under close scrutiny. I can assure your Lordships that I shall. We believe that we should let those concerned now proceed with the process and, for the reasons which I have given, I am glad that those opposite have explained that they will not now pursue proposals for a statutory code.
4.30 p.m.
Lord Howell: My Lords, with the leave of the House perhaps I may make just a few short points. First, I must express my profuse apologies to my old colleague the noble Lord, Lord Thomson. I must accept full responsibility for what has happened, and I do. In my defence I can say only that the news about the negotiations between the Minister and the Sports Council did not reach me until mid-morning with the result that I did not have the required time to consult that I would have wished for. In addition, I had been told—I had expected—that Amendments Nos. 2 and 3 would be taken together. Obviously, I was not quick enough on my feet to be able to object to their being considered separately—nor was anyone else—but that was the situation.
The noble Lord, Lord Barnett, is right. There was an attempt on my part to give statutory backing to what we are seeking to do in terms of a voluntary code of conduct, and for the very good reasons which my noble friend Lord Donoughue outlined. For the remainder of this debate I can do no better than adopt all the arguments advanced by my noble friend who put them extremely well.
This matter is now passed over to the Commons. I hope that my sporting colleagues there, some of whom are listening to this debate, will take note of the mood of this House. If I withdraw the amendment, as I intend to do, we shall be trusting to a voluntary code of conduct. We expect that trust to be honoured. We expect the spirit of this debate to be honoured. If that does not happen in the four or five weeks now available, we expect that the matter will be more firmly dealt with in another place. However, in the belief that the voluntary code of conduct will work and can be backed up by the constant vigil of the Sports Council and the Government, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness O'Cathain Baroness O'Cathain moved Amendment No. 4:
After Clause 5, insert the following new clause—
LOCAL DELIVERY SERVICE: CONDITIONS FOR GRANTING FUTURE LICENCES
(" .—(1) The Commission shall ensure that any licence granted after the coming into force of this section to a person for the provision of a local delivery service under section 73 of the 1990 Act contains conditions which require that person to include, by the reception and immediate re-transmission of the broadcasts, each of the relevant television broadcasting services for reception in the area for which the local delivery service licence is granted or for reception within the United Kingdom as a whole.
(2) For the purposes of this section "relevant television broadcasting services" means

(a) the television broadcasting services provided by the BBC which are funded from the licence fee; and

(b) the Channel 3 service, the Channel 4 service and, in Wales, the S4C service.

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(3) The Secretary of State may, after consultation with the appropriate regulatory authority, by order make such transitional arrangements for existing local delivery services in respect of the requirement in subsection (1) above as he considers appropriate.
(4) In exercising the power in subsection (3) the Secretary of State shall have regard to whether or not the local delivery service is delivered by analogue or digital means.
(5) The copyright in any broadcast is not infringed by reason only of the compliance by any person providing a local delivery service with the requirements of this section or any regulations made under it and it shall not be an infringement of copyright for any other person who is statutorily obliged to provide a relevant television broadcasting service as described in subsection (2) to broadcast those services whether encrypted or not.").
The noble Baroness said: My Lords, in this amendment I return again to an issue of great significance for our public service broadcasters as we enter the new age of digital broadcasting. My noble friend the Minister has progressively recognised, as the weeks have passed, that protecting quality public service broadcasting is fundamental to guaranteeing that the digital opportunities created by the Bill are not frittered away on disappointing and low-level programming which could dominate a multi-channel future.
As we know, in Britain we have a uniquely successful broadcasting system. Viewers have the option to see programmes such as "Pride and Prejudice", "People's Century", "The House", "Inspector Morse" and "Correspondent" on BBC2, bringing exceptional current affairs to TV as well as radio and an endless host of other entertainments, arts and educational programmes which the public relish and which, by and large, reflect our greatly valued culture.
Just last week the nation was united in common grief following the horrific events in Dunblane. We rely on our public service broadcasters to express our common anguish as much as our common joy. Our commemorations of VE Day and VJ Day are still very much in our minds. But all that comes with a price: the availability of quality public service broadcasting to all—I stress "to all"—supported by a licence fee which allows unique investment in programmes of outstanding quality. That investment depends on universal reach and availability. That is the nub of the amendment.
The amendment relates to "must carry". "Must carry" regulations are essential to protect viewers who pay a licence fee for television services and so that they can continue to receive those services which they value and want. Increasingly, viewers may choose to access their television services from cable providers. Indeed, industry predictions suggest that something like 40 per cent. of all homes will be linked to cable by 2005. The cable companies currently carry mainstream terrestrial public service broadcasting services; namely, BBC1, BBC2, ITV, Channel 4 and S4C, where relevant. It is a good deal. Cable subscribers want those services and the cable providers know that viewers' access to mainstream services is an essential component for securing subscriptions—the carrot, in effect, to encourage investment in what the cable providers are offering.
However, there is no requirement for that situation to continue and with an increased number of digital cable services, each pressing providers for priority space on
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the cable networks, commercial considerations could and will increasingly threaten the position of existing mainstream services once a significant number of the population have selected cable as their sole means of receiving television.
Let us face it: people do not like roof-top aerials. I always call them an "aesthetic nightmare". Increasingly, not just in flats but on new housing estates, cable is seen as the delivery system not only for television and radio, but also for phone calls, with interactive shopping potential, and games. If there is no requirement to carry any public service broadcasting, the public could find that the services for which they pay through the licence fee are not easily available to them. Amendment No. 4 seeks to correct that anomaly.
It is a commonsense amendment, which takes account of the realities of how commercial pressures could threaten public service channels. The regulatory authorities could, of course, challenge the cable operators if there were complaints from viewers denied access to the mainstream services of BBC1, BBC2, ITV, Channel 4 and S4C, but viewers are unlikely to be happy with either the hassle or the delay that such a challenge would involve. Resolving the situation now secures viewer access well into the digital future.
The Government's response to date has not been wholly satisfactory, despite the fact that my noble friend the Minister has been more than willing to listen to my advocacy. However, the Government have not given the cable industry the guarantee that it will be able to carry new public service channels without charge, nor have they given the viewers the guarantee that they will always be able to receive public service channels on cable systems.
Consumers cannot rely on the Government's argument on Report that:
"any such case of a monopoly franchisee abusing its dominant position to deprive customers of services they want to receive … having attracted custom on the basis that it would offer those services, would swiftly attract the attention of the fair trading authorities".— [Official Report, 5/3/96; col. 203.]
Although welcome in principle, that statement is not correct in practice. The terms of a typical cable contract state that the cable company is able to change the services it offers to the consumer. Indeed, on two occasions a satellite company changed the terms of my contract, reducing the service but not the price.
It is possible that a large number of viewers might sign on to cable knowing that the BBC is available. Eventually that analogue terrestrial will be switched off and if the BBC, ITV, Channel 4 or S4C are withdrawn viewers will have no other way of obtaining those services.
I believe that viewers will always want to watch public service channels. The question is whether cable companies will always want their viewers to be able to do so. The greater popularity of a public service channel could be seen by some cable service operators as a threat to the greater profitability of pay channels, particularly if those cable operators are in turn owned by pay-TV companies.
Nor is it true that the amendment would be unnecessary regulation. At present in negotiations between public service broadcasters and cable companies one party's right to contract is regulated but the other's is not. I stress that the BBC cannot refuse to provide its service to cable companies but cable companies can refuse to carry the BBC services. There is already regulation on carriage of public service channels on cable. All the amendment will do is to ensure that that regulation is fair and even-handed.
Perhaps I may explain briefly what the amendment does. The aim of the amendment is to guarantee viewers access to public service channels in the digital age by ensuring that cable companies must carry public service channels. There are at present two types of cable licence; those granted under the Cable and Broadcasting Act 1984 and those granted under the Broadcasting Act 1990. As I stated previously, holders of 1984 licences had to carry the BBC's publicly funded services and the ITV and Channel 4 services, but the 1990 Act removed that obligation. Eventually, all cable franchisees will have to apply for a 1990 Act licence; in other words, all cable franchisees could stop distributing the public service channels, even those which currently have a licence under the 1984 Act.
The amendment would extend the "must carry" obligation to the 1990 Act licences, ensuring that all cable companies carry the publicly funded services and public service broadcasting. Of course, there is a difference. In return for that "must carry" obligation, the cable companies get "free carry". The Copyright, Design and Patents Act 1988 gives the cable companies an exemption from copyright law when retransmitting public service channels which are neither encrypted nor broadcast by satellite. With digital broadcasting, encryption would be more common.
The amendment as worded would ensure that the exemption would not apply to many future public service channels, thereby eliminating the fear that, if the amendment were accepted, public service broadcasting could overload the systems. The response of the Cable Communications Association to the White Paper on digital broadcasting specifically requested that the Copyright, Design and Patents Act should be amended to allow the free carriage of new digital public service channels whether or not they are encrypted. Subsection (5) of the amendment grants the cable companies an exemption from copyright when carrying out their "must carry" obligations.
Your Lordships will have noticed that although the amendment deals with local delivery services, which would encompass both cable and satellite, I have in the main referred to cable. Under conditional access it seems that satellite would be covered; but if it is not, I would wish it to be covered. I must also ask why, if satellite is covered, cable is not covered.
In conclusion, the provisions in the amendment, which carry support from all sides of the House, are fair and just and are a simple guarantee that, in the uncertain future of digital broadcasting, we can be sure that our quality public service channels are available to all
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without discrimination. Failure to bring this measure into the Bill could undermine the entire concept of a universal licence fee and cut away the benchmark of quality that we have become used to as the standard-bearer in world broadcasting. I beg to move.
4.45 p.m.
Lord Thomson of Monifieth: My Lords, we on these Benches strongly support the amendment so clearly moved by the noble Baroness. She has dealt fully with the arguments and I have nothing to add beyond emphasising the fact that probably this is the last major broadcasting Bill before the turn of the century. It will take us into the digital age, as it is meant to. While it is now possible to rely on the self-interest of cable operators to carry the public service channels, once we get into pay-to-view television there may well be situations in which the companies decide that it is in their financial interest to go for those rather than carrying the public service channels. It is important to return to the provision of the 1984 Act in order to create certainty that the cable operators have an obligation to carry the public service channels.
Lord Ashley of Stoke: My Lords, I too support the amendment most strongly. The "must carry" provisions are an essential component in guaranteeing viewers access to public service broadcasting. Unfortunately, the Minister appears to believe that viewers have that access guaranteed for a long time. He gave that impression during the Committee and Report stages. However, I believe that he is deceived by appearances.
I am sure that some people who will be using cable television in the digital age will not wish to have additional aerials. They are unsightly, they can be expensive and they must be erected. There is a great deal of trouble and bother to which some people—not all and not even the majority—will not attend. As regards aerials, there is a risk that public service broadcasting will be lost to some people.
The problem which may arise does not stem from the decisions of the viewers but from the decisions of the cable companies. As has been indicated, they are willing to transmit public service broadcasting because it is in their interests to do so. They are trying to attract viewers. However, it would be unwise to assume that that will always be the case. In fact, the reverse may be the case and they will not want such viewers in the future. There is an increasing risk that as competition grows cable companies will be tempted to exclude public service broadcasters. Therefore, viewers who falsely assumed that they had perpetual access to the BBC and ITV channels could find themselves deprived. If that is the case, and I believe that it will be the case, the consequences for viewers will be regrettable. However, the consequences for the BBC and ITV companies will be catastrophic. Therefore, I must decide whether to accept the Minister's assurance that the fair trading authorities can deal with such a manoeuvre if it happens or after it has happened, or whether we should prevent it by legislation. Obviously, prevention is better than cure. Therefore, I hope that the principle of prevention can be accepted by the House and the Minister.

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I have no doubt that it is a tribute to the Minister's good nature that he regards me as cynical. In fact, on Report he called me cynical for suggesting that cable companies could act in that way by excluding the BBC and ITV. I believe that I am being realistic and that that is how the cable companies will operate. If the Minister cannot accept the detail of the amendment, I hope that he will accept the fundamental principle behind it and take steps to ensure that the BBC and ITV have guaranteed access on those wavelengths.
Viscount Caldecote: My Lords, I support the amendment moved so ably by my noble friend Lady O'Cathain. I wish to emphasise one point. Everyone who owns a television set must pay a licence fee to finance public service broadcasting. It would be extremely inequitable and it would be resented if people who had paid that licence fee could not receive public service broadcast programmes. Therefore, I strongly support the amendment for the reasons which my noble friend gave, but I wished to emphasise that point in particular.
Lord Barnett: My Lords, without wishing to make the noble Baroness too big-headed, I must say that I agree with almost everything that she said at the beginning of this debate and I shall not add very much to that. The case that she made was overwhelming. Knowing the good nature of the Minister and his willingness to accept sensible amendments, I am sure that he will accept this one because the idea of this "must carry" amendment is so overwhelmingly sensible that it could only have been put forward by the noble Baroness.
I hope that in his customary manner, the Minister will agree that that is the case. The noble Baroness said so much that seemed to me to be so strongly in favour of the amendment that I have nothing more to add except to say that I hope the Minister will accept it.
Lord Hayhoe: My Lords, first, I endorse all the compliments which have been paid to my noble friend. But I wish to introduce another reason as to why the use of roof aerials is not always appropriate. When I served in another place, my constituency was very close to Heathrow. However good the aerial on the roof, when aircraft passed over, if they were passing on the sightline between the roof aerial and the transmitting aerial, there were wild fluctuations in the pictures. Therefore, to people in that area cable has brought the enormous benefit of the reception of steady, high-quality pictures.
Indeed, I live in a geographical dip where, however high the aerial was placed, one tended to encounter difficulties. If the wind began to blow or pigeons decided to alight on one's tall aerial, that had devastating effects. Therefore, when cable television came to my area, for the first time in 20 years or more we enjoyed clear pictures on all four channels. Therefore, I believe that the arguments which my noble friend has adduced are extremely powerful and I hope that the Minister will respond in a constructive and positive manner.
Lord Monson: My Lords, I hold no brief for the cable companies. Apart from anything else, like most people who live in London, I have been infuriated by the traffic and parking chaos caused by their cable-laying activities.
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Against that, I recently received a circular letter from the BBC urging me to support this amendment. It contained no fewer than three glaring spelling mistakes and any number of grammatical errors. That does not make me feel very well disposed to the BBC either. However, when the noble Baroness responds, perhaps she will explain how Channels 3 and 4, as distinct from the BBC, can possibly be described as public service broadcasters in view of the fact that they are financed through advertising and not the licence fee.
Lord Inglewood: My Lords, we have already covered in detail in Committee and on Report the issue of introducing a requirement on cable operators to carry the channels provided by public service broadcasters. I have also had extensive and very constructive discussions with my noble friend Lady O'Cathain.
The Government have made it clear throughout that they are reluctant to move the regulatory goalposts by rescinding provisions made in the 1990 Act regarding the conditions of local delivery licences. As I have said both in this context and particularly during our debates on conditional access, we must give a message to industry that the regulatory environment will be stable.
However, as my noble friend and other noble Lords have made clear, their concern is with the digital future rather than with the analogue present. We have said throughout that we are in full agreement with aspirations behind the amendment. We want the services of existing public service broadcasters and, when it comes on stream, Channel 5 to continue to be available throughout the United Kingdom. That is why we are offering them guaranteed places on digital terrestrial television. We continue to believe that that is likely to be sufficient to ensure universal availability in the digital future, given that over 99 per cent. of the population has access to terrestrial television. It seems very unlikely that they will abandon terrestrially transmitted television for that exclusively delivered by cable unless they are sure that they will continue to receive the public service channels. That will give cable companies an enormous incentive, regardless of any regulation, to carry the channels concerned.
Nevertheless, as I have said myself many times during the passage of this Bill, it is very difficult to be absolutely sure of the way in which digital technology will develop, and the effect that will have on the market. The Government are, therefore, prepared to look again at how they might provide safeguards on the face of the Bill which would meet the principal concerns so lucidly explained by my noble friend and other noble Lords who have taken an interest in this matter.
I should stress that that will not mean reimposing requirements on cable operators using analogue technology. Neither will it mean allowing the public service broadcasters an unfair competitive advantage by requiring cable operators to carry any new commercial services which they may provide on digital terrestrial television. And naturally, cable operators would not he required to pay to carry existing services. Finally,

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I make it clear that none of that signals any weakening of the Government's commitment to ensuring that digital terrestrial television is given the best possible chance in the market. Of course, the offer of guaranteed places to existing broadcasters is an important part of that.
Within those parameters, the Secretary of State and I shall be discussing further with our colleagues in government the details of how we might move forward to a solution satisfactory to all concerned. I promise to keep my noble friend Lady O'Cathain closely in touch with our thinking. Given that assurance, I hope that she will be satisfied by that explanation and will agree not to press this amendment.
Baroness O'Cathain: My Lords, first, I thank all noble Lords who supported the principle of the amendment, because we are talking about a principle.
Just as an aside, perhaps I may explain to the noble Lord, Lord Monson, that there is a difference between publicly-funded broadcasting—that is, BBC 1 and BBC 2—and public service broadcasting which is BBC 1, BBC 2, ITV, Channel 4 and S4C. That is the distinction. The word "funded" is in one and "service" is in the other.
I am most grateful to the Minister. We have had a great deal of discussion about this matter. He has been 100 per cent. courteous and has been a listening and understanding Minister. It has been a delight to deal with him. I am grateful to him for the trouble that he has taken to meet me on this amendment. I am delighted that the Secretary of State and the Minister have decided to work out details regarding how it may be possible to move forward. I presume that the Government will bring forward in the other place a concrete way of ensuring that the concerns expressed so eloquently by Members of this House will be met.
Of course I can give my noble friend the Minister the assurance that the amendment does not deal with analogue; it is only for digital. We would certainly not expect public service broadcasting to have an unfair advantage. If at any time in the future—and, as we all know, the future is extremely uncertain in this area—public service broadcasting actually produced a commercial service, there would he absolutely no requirement under the amendment for the cable companies or satellite companies to carry such services. Again, I should like to thank all those who have taken part in the debate, and particularly my noble friend the Minister. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5 p.m.
Clause 19 [Duration and conditions of digital programme licence]:
Lord Ashley of Stoke Lord Ashley of Stoke moved Amendment No. 5:
Page 19, line 7, at end insert—
("( ) that by the eighth anniversary of the commencement date of the digital programme licence not less than 95 per cent. of the programmes to be broadcast in the service are subtitled to such technical standard as is specified by the Commission,
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( ) that by the eighth anniversary of the commencement date of the digital programme licence not less than 10 per cent. of the programmes to be broadcast in the service are presented or interpreted into sign language, and
( ) that by the tenth anniversary of the commencement date of the digital programme licence not less than 50 per cent. of the programme hours to be broadcast are audio-described.").
The noble Lord said: My Lords, I shall refer briefly to the amendment once again for three reasons. First, as the Minister said in a recent letter to me, there was insufficient time to discuss the matter on Report. Secondly, I do so because it is a matter of profound importance to those who are deaf and hard of hearing and people who are sight impaired; and, thirdly, because I believe that the Minister has genuinely misunderstood the situation. In his letter to me he said that a code would have a greater impact than specifying targets for subtitling, signing and audio-description. After all the discussion that we have had this afternoon on the effect of a code, I cannot believe that the Minister still holds that belief.
The Minister has given the impression that he believes that the levels of targets required in the amendment could be achieved by the code which has already been mentioned. In his letter to me the Minister said that the code would allow,
"for the amount of subtitling to be increased as the market takes off and broadcasters move into profit [and that it] could make clear that those entering the market in a strong position might be expected to provide subtitles ֵ from the start".
The point about subtitles on television is that they enable totally deaf people to follow television programmes. When I lost my hearing completely about 28 years ago I could not watch television because there were no subtitles. That meant, apart from just watching sport and perhaps activities like snooker, I could not follow the dialogue on television. It is incredible, but television did not exist for me 20 or so years ago; indeed, it did not exist for me for 25 years until I had my cochlea implant.
Many deaf people today are reliant upon the subtitles on television and those who use sign language are similarly dependent upon that. If they do not have those services, television in 1996 does not exist. It is a staggering fact but it is true. Blind people or those who are very heavily sight impaired cannot follow television programmes. However, if they have access to audio-description where someone explains to them what, say, the criminal is doing racing down the street in a car being followed by a policeman, they can then understand the dialogue. Indeed, with audio-description, those blind people or those whose sight is impaired can follow such programmes. That is why the amendment is so profoundly important.
I support the plaudits offered to the Minister. I believe that his conduct has been great on the proceedings of the Bill. I endorse all the tributes that have been paid to him. I know that he cannot accept my amendment on this occasion, but I hope that he will accept the principle behind it. If he does not do so, it means that those very severely handicapped people, those sight-impaired people who cannot regain their sight and those without the implant to which I referred—andthere are many

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thousands of people without such implants—will be seriously deprived of digital television. When that comes it will be a great shame to leave those people without access to it.
Finally, I should like to turn to the code, to which my noble friend Lord Donoughue spoke with great eloquence on the last amendment. He spoke about the impact and effect of a code. It does nothing compared with legislation. If the Minister does not accept that, all I can say is that he will be letting down all those people who are relying upon him. At the end of the day, I hope that the Minister will be able to do something for the people to whom I referred. I beg to move.
Lord Inglewood: My Lords, as the noble Lord, Lord Ashley, said, I have already written to him setting out in detail the Government's position on the provision for disabled people by digital terrestrial broadcasters. Therefore, I shall attempt to be as brief as possible. However, at the same time, I believe it is important for the whole House to have the opportunity to hear the arguments involved.
It may appear at first sight unreasonable to object to the proposition that virtually all digital terrestrial programmes should be subtitled and that a large proportion should be available with sign-language interpretation and audio-description. I accept that, without those services, television is inaccessible to significant numbers of people and that where it is practicable they should be provided. I think it is fair to say that the Government have, with the full co-operation of existing broadcasters, demonstrated their commitment in the area, and a large proportion of programmes shown now has subtitles. That was achieved gradually and further progress is being made under the provisions in the 1990 Act. The advent of digital technology may well facilitate the provision of subtitles by allowing them to be provided as separate streams of information on the same frequency channel as well as via text services. It may also facilitate both audio-description and sign-language interpretation, as it will be possible to make them available to those who wish to access them without their being received by all viewers indiscriminately. I hope that full advantage will be taken of those possibilities. But let us be clear that none of those services can be provided without a great deal of effort and without the involvement of a large number of skilled people.
I shall concentrate here on subtitling. On Report, the noble Lord referred to the,
"seemingly miraculous simultaneous presentation of words on a screen as they are spoken".—[Official Report, 5/3/96; col. 222.]
There is no miracle involved, merely a great deal of hard work. Even subtitling for pre-recorded programmes, the easiest and cheapest sort to provide, involves a great deal of work by highly trained staff using sophisticated and expensive video and computer equipment. The text of most programmes has to he edited down by about 40 per cent. The captions must be synchronised with changes of camera shot. It takes a year to train a subtitler to operate at what is regarded as a good speed, about 30 minutes of screen time subtitled per working
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day. The skills required are very much akin to those of a modern newspaper sub-editor in terms of both linguistic and technical skill.
As the noble Lord said on Report, that might cost about £600 per programme hour. If a broadcaster is spending £600,000 on an hour of high quality original drama, I agree with the noble Lord that he should be able to afford an extra 0.1 per cent. for the subtitling. Equally, if someone is providing a movie channel, spending large sums on film rights, attracting large numbers of subscription viewers and repeating films on several occasions, he, too, should be able to afford to subtitle a high percentage of output. I am sure that the ITC's code, which we have provided for in the Bill, would reflect that. The government amendment that I shall shortly move reinforces the ability of that code to respond flexibly to the practical needs of disabled people by requiring the ITC to consult them before drawing up the code.
However, let me be very clear. In 1990 we were dealing with a situation which is very different from that which we have now in that analogue terrestrial braadcasting was an extremely stable market dominated by very large and established organisations which have very large programme budgets. But most new digital terrestrial broadcasters will not have £600,000 to spend on one hour of programming. Nor are they going to have large numbers of viewers; indeed, every broadcaster will start off with an audience of nil and some will be providing specialised services that will only ever attract a minority. Many new services could be working to budgets of as little as £2,000 per hour, as I understand some satellite and cable stations already do. What is more, some of those are likely to be live services. Subtitling live programmes is considerably more difficult and requires more expensive equipment and the efforts of very fast stenographers with levels of skill similar to those of the people who serve us so well in this House. It also requires substantial extra studio space. It is quite possible that for some new broadcasters subtitling could represent as much as a 50 per cent. increase in programme budgets. That clearly would be enough to endanger their survival in the market. If they do not survive, there will be no programmes for anyone, including disabled people.
In these circumstances we believe it would in the long run help no one to impose on new digital broadcasters, within eight years of launching their services, requirements considerably more onerous than those asked of existing broadcasters who have been established for decades and have almost every citizen of the United Kingdom as customers. As I explained on Report, each existing terrestrial broadcaster, unlike many new digital ones, also provides a heterogeneous service, some parts of which are easy to subtitle and some more difficult and costly, leading to an overall balance. But even then, the provisions in the 1990 Act do not, as this amendment would, remove the scope for account to be taken of differing circumstances between broadcasters. Once the proportion of programmes subtitled by existing

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broadcasters exceeds 50 per cent., as it is scheduled to do by 1998, the Act allows the ITC to require broadcasters, through licence conditions, to subtitle,
"the greatest number of hours in a week that appears to the Commission to be reasonably practicable".
The noble Lord said in Committee that it would be quite unfair for some television businesses to bear the cost of subtitling and others to evade it. I suggest that it would not be fair to treat the whale the same as the minnow. Given that there are not unlimited numbers of subtitlers, it seems to me important to ensure that efforts are concentrated on programmes with the widest appeal. The Government therefore remain in favour of a code. The use of a code will allow for distinctions to be made between different types of broadcasters; for example, those spending £600,000 an hour on programmes and those spending a tiny fraction of that. It will also allow for the amount of subtitling to be increased as the market takes off and broadcasters move into profit.
If digital terrestrial television takes off in the way we hope and believe it will, and becomes the primary mode of transmission, the medium-term outcome might be that subtitles are provided for a similar proportion of new digital programmes as for programmes transmitted on existing analogue channels. Simulcasts, of course, will be subject to the same requirements as analogue services. In absolute terms that would mean a vast increase in the number of programmes accessible to deaf viewers, although the percentage might be higher on profitable digital services with wide audiences—in other words, the ones that most people want to watch—than on more specialist channels. I should stress also that the code could make clear that those entering the market in a strong position might be expected to provide subtitles and the other services referred to in the noble Lord's amendment at an earlier stage rather than after eight years.
I have already made clear to the noble Lord that I am concerned to ensure that we do the best we reasonably can in this Bill for people who would benefit from subtitling, signing and audio description and that I am prepared to discuss this issue further. That consideration might, of course, now feed through into deliberations in another place. However, I believe the arguments I have just set out are strong. The Government remain convinced that a code is the right approach, as opposed to the inflexibility of setting percentages on the face of the Bill. As I have already made clear in previous debates, the House has already accepted, by giving its approval to the Disability Discrimination Act, that this approach should apply to other industries and services. Under that Act, what it is reasonable to expect service providers to do to make their services accessible is to be determined by detailed regulations allowing for different circumstances and drawn up after due consultation and reflection, including with disabled people. We believe that we should be consistent with that. I fully understand that the noble Lord may feel disappointed at my remarks but at least I hope that he will understand the basis of my thinking.
Lord Ashley of Stoke: My Lords, with the leave of the House, I genuinely thank the Minister for the few concessions that he has been able to make. He referred
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to the whale and the minnow not being treated alike. That is a colourful phrase but I hope that he will be careful about encouraging companies into the market and absolving them from the costs of providing services for deaf and blind people, because if those companies cannot afford to pay those legitimate costs they should not enter the market. They have a clear duty to provide those services. The Minister has been helpful and I am grateful for his comments. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 20 [Code relating to provision for deaf and visually impaired]:
5.15 p.m.
Lord Inglewood Lord Inglewood moved Amendment No. 6:
Page 20, line 20, at end insert—
("( ) Before drawing up the code or reviewing it in pursuance of subsection (1) the Commission shall consult such bodies or persons appearing to them to represent the interests of the persons referred to in subsection (1)(a) as the Commission think fit.").
The noble Lord said: My Lords, in moving Amendment No. 6 I wish to speak also to Amendment No. 7. I have tabled these amendments in response to an amendment put down by the noble Lord, Lord Ashley, during the Committee stage. As your Lordships will recall, the Bill as drafted provides that the ITC should draw up, and from time to time review, a code giving guidance on the extent to which digital programme services should promote the understanding and enjoyment of programmes by persons who are deaf, hard of hearing, blind or partially sighted and on the means to be used for that purpose.
The first of these two amendments provides that the ITC should consult bodies representing the deaf, hard of hearing, blind and partially sighted before drawing up this code: the second provides that the ITC should publish the code in forms that are accessible to the blind or partially sighted and deaf or hard of hearing. I beg to move.
Lord Ashley of Stoke: My Lords, those provisions will be warmly welcomed by the people concerned. I am grateful for them.
On Question, amendment agreed to.
Lord Inglewood Lord Inglewood moved Amendment No. 7:
Page 20, line 24, at end insert ("and in determining the manner of publication, the Commission shall have regard to the need to make the code or revision accessible to persons who are blind or partially sighted and persons who are deaf or hard of hearing").
On Question, amendment agreed to.
Clause 29 [Promotion of equal opportunities]:
Lord Inglewood Lord Inglewood moved Amendment No. 8:
Page 26, line 3, after ("groups,") insert—
("( ) to make arrangements for promoting, in relation to employment by him, the fair treatment of disabled persons,").
The noble Lord said: My Lords, in moving Amendment No. 8 I wish to speak also to Amendments Nos. 9, 10 and 11. These amendments take on hoard an issue raised during the Committee stage by the noble

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Baroness, Lady Dean of Thornton-le-Fylde, and the noble Lord, Lord Ashley of Stoke. The amendments extend the existing clauses on promotion of equal opportunities in relation to employment to require that holders of television multiplex and digital programme licences, national radio multiplex and national sound programme licences should make arrangements for promoting, in relation to employment by them, the fair treatment of disabled persons. These amendments also bring our provisions in line with the Disability Discrimination Act 1995, giving "disabled person" the same meaning as in that legislation. I beg to move.
Lord Ashley of Stoke: My Lords, these provisions again will be warmly welcomed. I am grateful to the Minister.
On Question, amendment agreed to.
Lord Inglewood Lord Inglewood moved Amendment No. 9:
Page 26, line 6, at end insert ("and "disabled person" has the same meaning as in the Disability Discrimination Act 1995.").
On Question, amendment agreed to.
Clause 62 [Promotion of equal opportunities]:
Lord Inglewood Lord Inglewood moved Amendments Nos. 10 and 11:
Page 56, line 3, after ("groups,") insert—
("( ) to make arrangements for promoting, in relation to employment by him, the fair treatment of disabled persons,").
Page 56, line 6, at end insert ("and "disabled person" has the same meaning as in the Disability Discrimination Act 1995.").
On Question, amendments agreed to.
Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 12:
Before Clause 67, insert the following new clause—
AMENDMENT OF THE BROADCASTING (RESTRICTIONS ON THE HOLDING OF LICENCES) ORDER 1991
(".—(1) The Broadcasting (Restrictions on the Holding of Licences) Order 1991 is amended as follows—
(2) In article 12(3) for "two" there is substituted "three".
(3) In article 13(1)—

(a) for "hold a licence" there is substituted" hold more than one other licence"; and

(b) for "holder of a licence" there is substituted "holder of more than one other licence".

(4) In article 13(2)(a) for "for which the service" there is substituted "for which a service".
(5) In article 13(2)(b) there is inserted "and
(c) provided as a local radio service falling into category A or B".
(6) After article 13 there is inserted—
"Radio services licences.
13A—(1) Subject to paragraph (5), a person who holds a licence to provide a local radio service shall not at any time hold a licence to provide a local radio service to which this article applies; and, subject to paragraphs (3) and (4), such a person shall not be a participant with more than 20 per cent. interest in a body corporate which is the holder of a licence to provide a local radio service to which this article applies.
(2) This article applies to a local radio service which is—

(a) provided for an area which is substantially the same as that for which the service provided by the person mentioned in paragraph (1) is provided; and

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(b) provided on the same frequency band as that service; and

(c) provided as a local radio service falling into category C or D.

(3) A person who holds a licence to provide a local radio service may be a participant with more than a 20 per cent. interest in a body corporate which is the holder of a licence to provide such a local radio service as is described in paragraph (2) if the number of persons over the age of 15 resident in the smaller area does not exceed 10 per cent. of the number of such persons resident in the larger area.
(4) Where such a person as is described in paragraph (3) is a participant with more than a 20 per cent. interest in a body corporate which is the holder of a licence to provide such a local radio service as is described in that paragraph he may not be a participant with more than a 20 per cent. interest in any other such body corporate.
(5) Nothing in this article shall prevent a person from holding licences to provide local radio services if—

(a) that person was, immediately before the grant of the licences, a local radio contractor for an area which was substantially the same as the area in respect of which those licensed services are provided; and

(b) he provided two or more different programme services on different frequencies pursuant to his contract.

(6) For the purposes of this article two areas are to be regarded as substantially the same if at least 50 per cent. of the persons over the age of 15 resident in the smaller area are also resident in the larger area.".").
The noble Lord said: My Lords, I hope it will not be necessary to occupy the time of the House for too long on this rather wordy amendment which deals with the small matter of making it possible for an independent local radio station to operate a second FM channel in areas where there is likely to be a strongly competitive market. There seems to be no problem about the BBC operating four FM channels in the same location. If I understand its new Charter correctly, it may even have the possibility of operating a commercial transmission channel, which may well give it a fifth FM frequency, again in the same area. However, the regulations as at present constructed prevent an independent local radio station from operating a second channel. I hope that we might be able to move a little further forward on this matter. At Report stage my noble friend the Minister was what I would call damply encouraging—if I may use such a euphemism—on this matter. I hope that the additional time that has passed since then will enable him to be rather more encouraging today. I beg to move.
Lord Inglewood: My Lords, as my noble friend Lord Dixon-Smith said, at the end of the debate in Committee I indicated that the Government have not a firmly closed mind on this issue. That remains the case. However, rather than rehearsing all the arguments again tonight, it may be helpful if I highlight the paradox which lies at the heart of our discussions.
The aim of our Bill is to allow greater concentrations within the media while at the same time seeking to preserve plurality and diversity. All of the restrictions in Schedule 2 should be viewed in that light. When considering radio ownership, we are essentially dealing with two quite different states of affairs. First there are urban areas offering a wide

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choice to the listener, and, secondly, there are rural areas where a single local radio station may be dominant. The amendment tabled by my noble friend seeks to relax the two licence limit in urban areas while retaining it elsewhere.
It has been argued that where there is already choice we should not constrain successful companies from further growth. Yet it is in just these areas that fears of excessive concentration of power are greatest because, conversely, it has been argued that allowing a dominant, established broadcaster to have a second licence in a shire area would be more likely to lead to a lasting new service, because of the economies of scale which would be unavailable to, and thus discourage, any other potential bidders. Any detrimental effect on plurality of the same ownership would be more than offset by the wider range of services provided.
My noble friend's amendment allows greater concentration of ownership where there is already a multiplicity of choice, while ignoring the possibly greater benefits from a wider variety of services to listeners in shire areas that a relaxation in ownership might bring. The Government's view is that any relaxation should apply generally, but should incorporate safeguards both for plurality of ownership and for diversity of output.
Let us he under no illusions. This is a difficult area. I undertook at Report to consult the Radio Authority to see whether the current arrangements can be improved. I met Sir Peter Gibbings last week for a preliminary discussion. I believe that there may be some scope for movement, but we have not yet defined possible improvements. I assure the House that in our further considerations the interests of the listener will be to the fore. But the Government will also bear in mind that the continued development of strong and successful companies within the radio market can be of great benefit to the industry and the public alike.
I hope that the further assurances I have given this evening will convince my noble friend that the Government have taken on board the concerns that he expressed. We are looking carefully at the problem and hope to arrive at a satisfactory solution for implementation in the Bill. I know my noble friend shares my view that if the current restriction to one FM and one AM licence is to be relaxed the specific approach in this amendment may well not be the right one. In view of what I have said I hope that he will not seek to press the amendment this evening.
Lord Dixon-Smith: My Lords, I am grateful to the Minister for the trouble that he has taken on the issue. I have no doubt that I also owe thanks to others outside this Chamber. My noble friend states that he seeks a solution. I entirely accept that the wording of the amendment may not he in perfect form for legislation. I beg leave to withdraw the amendment.
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Amendment, by leave, withdrawn.
Clause 69 [Funding of Sianel Pedwar Cymru]:
Lord Cledwyn of Penrhos Lord Cledwyn of Penrhos moved Amendment No. 13:
Page 60, line 27, leave out ("transmitting") and insert ("providing").
The noble Lord said: My Lords, the purpose of the amendment is to widen the power of the Secretary of State to take all the costs of providing a full digital service into account as well as the cost of transmitting the service. The effect would be to provide a fairer base for the new arrangement than the 1997 amount. It encompasses all the costs which will be incurred by the S4C digital service.
This short amendment follows the debate about the proposed new funding arrangements for S4C and, more precisely and importantly, the question of the fairness of the settlement. That lies at the centre of my argument. I am sure that the Secretary of State will recognise that.
During the passage of the Bill through the House, I noted that some noble Lords referred to the proposed funding arrangements for S4C. The matter was referred to at Second Reading and at Report stage. Let us look at the reality of the position. The fact is that at present S4C's funding formula is one based on 3.2 per cent. of total advertising revenues. The Bill proposes to change the formula from 1998 to one based on the 1997 funding plus RPI. Noble Lords have pointed out to the Minister that total advertising revenues have consistently risen at a higher rate than RPI and that this pattern is projected to continue.
What does this mean? It means that the proposed funding formula will give S4C a lower level of funding support in the future. Let us be clear about this. It will weaken the current analogue service; and, furthermore, S4C will be unable to take advantage of the opportunities presented by digital broadcasting. The cost of implementing a digital service must be reflected in the future funding arrangements. The opportunity to do more is there, but the means are not, and the availability of a Channel 4 digital service in Wales will have an effect on S4C's advertising revenue.
I know that S4C welcomes the reassurances given by the Government that commercial flexibility will be awarded in order to maximise other funding schemes. This is similar to the provision granted to the BBC. But there are marked differences between the BBC and S4C. They are at opposite ends of the spectrum in terms of scale. In terms of income, the licence fee provides the BBC with income 20 times greater than S4C. Commercially the BBC has a global market to exploit. S4C's market is more limited as it seeks to serve a minority audience, and S4C has a less established international brand.
Despite the noble Lord's assurance on 13th February at col. 602 of the Official Report, that,
"The Government are committed to ensuring that proper arrangements are in place for S4C to continue to thrive. That includes the adequate provision of resources",
the Government have not accepted any arguments which have sought to address the obvious conflict between a lower level of funding and the opportunity to provide an enhanced S4C service using digital technology.
This conflict is at the very heart of the concerns voiced by noble Lords and by S4C. Despite the opportunity and the will to exploit new commercial opportunities, S4C must always be heavily dependent on public funding—a fact accepted by the Government at the time of S4C's foundation. I am glad that the noble 'Viscount, Lord Whitelaw, is present this evening because 15 years ago he played a major role in the foundation of S4C, and Wales will always be grateful to him for that. He knows that what I say now is accurate. That fact is an undeniable reality for a minority channel. S4C's funding has to be protected and stagnation for S4C at a time when all other broadcasters in the UK develop their services is not an option and is patently unfair.
With the support of the Government and opposition parties, and with its own drive and imagination, S4C has developed into a major Welsh organisation in the space of 15 years. It has a central role in supporting and nurturing the Welsh language and culture. The fortunes of the Welsh language are on the upturn. I am glad to have the understanding and support of my noble friend Lord. Elis-Thomas, the chairman of the Welsh Language Board. At least 25 per cent. of the population of Wales have a reasonable understanding of Welsh, and 19 per cent. are fluent in the language. The total number of Welsh speakers is stabilising after decades of decline and an increase is evident within the critical younger age group. In a recent survey conducted by NOP, 20 per cent. of those interviewed who had spoken a little Welsh at one time in their lives had been inspired to try to use the language by the existence of S4C. Twenty per cent. of those with no knowledge of Welsh also watched some Welsh programmes by availing themselves of the sub-titling service. S4C is central to the television viewing patterns of Welsh speakers today. Sixty one per cent. of fluent Welsh speakers watch S4C for at least half their total television viewing time.
Given S4C's influence on the improved state of the language, and given that its establishment has resulted in a remarkable level of social cohesion in Wales, it is surely vital that S4C's funding remains at a realistic and practical level. Government funding is given to S4C in order to produce television programmes. But it would be naïve to think that the benefits are limited to the channel's output. The effect of the Government's financial support on the language, culture and social harmony in Wales is immeasurable, but it is there for all to see. S4C is the major commissioner of work from independent producers in Wales. The security of thousands of jobs is inextricably linked with the financial well-being of S4C. These jobs have brought economic benefits to areas where other employment opportunities are limited. Any diminution of funding would have a negative impact on all those related issues. It would be a serious blow to Wales and one which would hurt the Welsh community from Anglesey to Gwent.
Sixteen years ago, we had a long and difficult debate about the future of television in Wales in which I was closely involved, as was the noble Viscount, Lord Whitelaw, to whom we owe a great deal. The issues are fundamental in Wales today. I feel that the House and the Government should respond to the call and the plea of Welsh people at this time. I beg to move.
5.30 p.m.
Baroness Dean of Thornton-le-Fylde: My Lords, from these Benches I support the amendment, although I am probably the only person whose name is attached to it who does not speak a word of Welsh. However, the other three signatories do.
It is regrettable that the Government have chosen to make no moves in this important area for a small but nevertheless important television service to people in Wales. We feel that the Government have walked away from the advanced step that was taken when S4C was set up. It is a small company, covering 25 per cent. of Welsh speaking people in Wales. We have to be careful. It will be crushed in what will become an international big boys' game if the funding of S4C is affected in the way we believe it will be. A reduction of funding would weaken the analogue service. We would have a Broadcasting Bill which provided the means for S4C to go digital but did not provide the financial underpinning which is necessary. The channel would be kept in a competitive box unable to develop.
At the same time as digital services become available, Channel 4 in Wales will take a major part in the competition for advertising revenue in Wales. Noble Lords have been trying to find a means through discussion with the department and through amendments at Committee and Report stages, as well as now at Third Reading, to give S4C hope that it will not be allowed to shrink on the vine as it feels will happen. The channel will not be able to compete in a system which makes the competitive requirements fair to it. I hope that the Minister will be able to give S4C better news at this Third Reading than at the Committee and Report stages.
Lord Aberdare: My Lords, I wish warmly to support the amendment so well moved by the noble Lord, Lord Cledwyn. There are serious worries in Wales about the future of S4C. It has been universally acknowledged by Welsh and English speaking people in the Principality that S4C has been a great success. None of us wants to return to the unhappy period of social unrest that preceded its existence. It has been a significant factor in supporting and nurturing the Welsh language and culture. A whole network of supporting jobs has grown up around it. However, as has been said, its future depends on its funding arrangements. Efforts have been made at every stage of the Bill by many of us to ensure that it will be fairly treated.
At the Committee stage, my noble friend Lord Inglewood said:
"The Government are committed to ensuring that proper arrangements are in place for S4C to continue to thrive. That includes the adequate provision of resources".—[Official Report, 13/2/96: col. 602.]

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Fair words butter no parsnips—or should they be leeks? The facts are these. First, funding in future is to be linked to the retail prices index and is therefore likely to grow less than the proportion of advertising revenue did before. Secondly, as a minority channel S4C is and always will be dependent on public funding. It will do its best to increase its commercial resources, but its task will be that much harder when a Channel 4 digital service is available and in competition with S4C for advertising revenue.
We tried to persuade the Government to continue to pay the grant on 1st January. That was refused. We put forward an amendment for a slight widening of the Secretary of State's power so that the transmission costs of a digital service should include the cost of promotion. That too was turned down. This is our last effort to try to obtain help from the Government.
Throughout the passage of the Bill, S4C has been encouraged to continue talks with officials of the Department of National Heritage but so far without any satisfactory conclusion. As noble Lords have said, on this side of the House we can take pride in, and are especially proud of, my noble friend Lord Whitelaw's part in instituting S4C. We would be wise to ensure that it continues to flourish. We have a good record of economic success in Wales. We should not allow any failure in the broadcasting field to overshadow that achievement. I conclude by asking my noble friend on the Front Bench to give a positive response.
Lord McNally: My Lords, perhaps it is appropriate for another English voice to support the amendment, although eagle eyes may see that my noble friend Lord Geraint is sitting behind to ensure that I keep close to the party line. I have another interest since I am married to a Swansea girl whose sister lives in north Wales, so I have a fully balanced view of the issues concerned.
The crux of the answer we wish to hear from the Minister was mentioned by the noble Lord, Lord Aberdare. The Minister referred to the Government's commitment at earlier stages of the Bill. At this point we ask whether the means will be available for the desired end. If not, all the good will in the world is of no use.
Broader issues are at stake than simply a Welsh interest. Some noble Lords have pointed out that when the noble Viscount, Lord Whitelaw, championed S4C he was cementing the Welsh nation into the British nation. We discuss Europe and the capacity of nations and regions to prosper and retain their identity. The willingness of the broader British state to commit itself to such an imaginative experiment as S4C was a sign of what can be done. I do not want to tempt other Members into a broadly European debate. However, I do think it is important in terms of regions and nations of Britain that the larger shows imagination and generosity in respect of the smaller.
In setting up S4C, the noble Viscount, Lord Whitelaw, showed that vision and breadth of imagination. What we need to see now from the Minister is a recognition that
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that confidence was not misplaced. As a number of noble Lords with great experience of Welsh culture, language and society affirmed, the television channel has been a cementer, strengthener and improver of all those things in the Welsh nation. We are looking now for a recognition of that success and of the dangers of underfunding, and for the Minister to give this House the commitment in spirit that he gave at an earlier stage.
Viscount Whitelaw: My Lords, as I believe the House knows well, I have been very much in favour of this development. I was persuaded completely by the noble Lord, Lord Cledwyn, long, long ago that I must do this. I did it; and I was right. I did exactly what the noble Lord told me to do, and it was not wrong on that occasion. I can only say to the Minister that he is a great friend of mine and he can do a great many things in this respect. I hope he will be able to think very carefully of something that has been a very considerable success in Wales.
Lord Elis-Thomas: My Lords, I am very grateful to the noble Viscount for contributing to this debate. He will remember the heated debate at the time he was making his various decisions on these matters. So too will his noble friend, the noble Lord, Lord Crickhowell, who will also remember our conversations in those days when my honourable friend in another place, Mr. Gwynfor Evans, decided to make a public stand on this issue. The noble Viscount will recollect that the issue had all-party support in Wales. I pay tribute yet again to the involvement of the noble Lord, Lord Cledwyn, in today's debate, as he was involved then.
It will not have escaped the Minister that the amendments we have moved on issues relating to S4C in Committee, on Report and now at Third Reading also have all-party support in this House. That mirrors the situation when the channel was established. I shall not repeat to the Minister what I said during the technical debates in Committee about the nature of the funding formula. What I will ask him to do is look to this consensus and to not breaking it. I ask him to ensure that the decision on that channel, established by his noble friend Lord Whitelaw on the principle that it should be adequately funded in order for it to compete successfully along with all the other broadcasters, will be upheld and that the momentum established by the channel will be maintained.
The Minister in particular, and his officials, have been prepared to discuss this whole issue with the authority. It is obviously up to the authority to justify its arguments in terms of the level of funding it requires. We are in difficulty here in that, short of having some independent arbiter (I do not suggest that, but it might be one way of proceeding) funding is very difficult to quantify in this area of broadcasting as we move through analogue into the world of digital. (I must say, the Welsh word digidol is much easier to say than the word "digital". I shall say digidol rather than digital.)
The point is this. As we move into a multi-media situation in new technology, it is essential that the authority should be able to compete. To measure the real costs of that revolution requires very careful, objective analysis of what the costs are likely to be.

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For those reasons I ask the Minister to assure the House that he stands by the statement he made at earlier stages of the debate. He committed himself and the Government to ensure "adequate provision of resources". If it becomes clear to the Minister and his department, through the submissions of S4C, that the present level of the formula set out on the face of the Bill is not adequate, on the objective evidence presented to his department, I hope that he will either take the route of seeking further independent advice or will ensure that resources are provided according to the clear views expressed by the authority and its officials.
I should have declared an interest as chair of Screen Wales, and also on behalf of the rest of my household. My son is employed as a post-production sound person in that excellent facilities company, Barcud. My wife's translation agency, Cymen, also benefits from contracts from S4C, including subtitling.
5.45 p.m.
Lord Prys-Davies: My Lords, at every stage in the passage of the Bill, as the noble Lord, Lord Aberdare, pointed out, we have been at pains to try to mitigate the funding formula which is in the Bill and at Clause 69, as we understand that the terms of that formula will inflict injury on S4C. But, depressingly, the Government have not accepted any of our amendments. However, I assure the Minister that we have not surrendered to the arguments he has advanced.
Initially, I remind noble Lords, the Government maintained that the reason for changing the formula was to provide S4C with a "more predictable and reliable formula". That argument has been demolished. It is inconsequential, because S4C has never experienced any difficulty with the formula and never asked for it to be adjusted.
Perhaps I may also remind the House that in Committee, the noble Lord, Lord Inglewood, threw a different explanation at us. The new terms, so we are told, will put S4C funding on a similar basis to that of the BBC. I took careful note of that comparison, because it appeared to me to be somewhat persuasive. However, I have reflected on that formula, and it is totally unfair.
There are at least four major defects in the comparison. First, it lacks integrity because it is used selectively. The comparison is resorted to when it is helpful to the Government for one purpose and one purpose only; namely, to reduce the funding of S4C. But it is entirely ignored when it comes to other purposes, such as giving S4C the same digital capacity as the BBC
Secondly, as my noble friend Lord Cledwyn clearly pointed out, and I shall not elaborate, it is plain common sense that the BBC and S4C are at opposite ends of the spectrum, and one cannot draw a comparison.
Thirdly, it was not contemplated 12 or 13 years ago when S4C was established that its funding should be on a basis of comparability with that of the BBC. It was accepted, as I believe the noble Lord, Lord Aberdare, mentioned, that S4C would always he more heavily
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dependent on public funding than was the case with the BBC. But on that matter the Government have experienced a spasm and changed their mind.
The fourth and last defect is that the new funding formula will lead the Government's Welsh language policy into a farcical situation. I very much hope that the noble Lord will convey that argument to his noble friend the Secretary of State for Wales. Diminish or reduce S4C funding and S4C may become less effective than hitherto, with the inevitable result that the painstaking efforts of schools and teachers throughout Wales and the public and voluntary bodies will be greatly diluted or weakened, if not thwarted.
I should like to make one final point. No new measure will be taken to compensate for that loss because there is none that can be taken. To my mind, on that basis alone the funding formula embedded in Clause 69 needs to be amended and mitigated in favour of S4C. I very much hope that the Minister will give: very careful consideration to this amendment, which has been ably moved by my noble friend Lord Cledwyn.
Lord Inglewood: My Lords, I am most grateful to the noble Lord, Lord Cledwyn, for setting out the rationale for this amendment, which aims to meet, as he himself said, similar concerns to those raised by the noble Lord, Lord Prys-Davies, in the amendments that he tabled on Report. I am also grateful to all noble Lords who have contributed to our discussion this evening.
Since the debate on Report, I again met very recently the chairman and chief executive of S4C. I listened carefully to their concerns for the future of S4C and what they see as the implications of the proposed arrangements for funding the channel for the way in which it 'carries out its activities and fulfils its remit. I shall elaborate in further detail on certain points relating to that. We shall also reflect carefully on your Lordships' remarks this evening.
The funding arrangements in the Bill already allow for extra provision for S4C's transmission costs. That is in line with the provisions of the 1990 Act. I have also indicated that we shall be making provision for S4C to increase its commercial activities and therefore enhance its self-funding capabilities, though I am afraid that time has not allowed us to bring forward the necessary amendments to your Lordships' House. We believe that these are sensible measures to ensure the continued success of S4C, while keeping the running of the channel, and in particular editorial control, sufficiently distant from government interference.
As I made clear on Report, S4C will be able to use its public funding to meet the costs of broadcasting S4C digital, including measures to promote receiver take-up which will be taken forward in partnership with the other broadcasters on the multiplex. S4C is unique among broadcasters in being given the possibility of additional funding to meet its transmission costs, both analogue and digital, and I cannot see why S4C should be given any extra funding to meet other costs which other broadcasters, including the BBC—although it is much bigger than S4C it is very similar inasmuch as it is publicly funded and is self-regulating—should meet from their existing sources of revenue. As I stated on

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Report, it seems that there is a line to be drawn with regard to what might legitimately be seen as an extra call on taxpayers' money. I believe that the line is sensibly drawn behind transmission costs.
This amendment would extend significantly S4C's ability to call on the Government for additional funding beyond that derived from the core funding formula. Following earlier representations from S4C and arguments made in our own debates, Clause 69 as drafted is careful to maintain and not to disturb the traditional arm's length relationship with the Government which all broadcasters have come to expect and, quite apart from the other considerations, I am convinced that what is proposed might prejudice that. Moreover, in its implication of generalised bids for additional funding, the amendment raises obvious questions of public expenditure control. I remain to be convinced that additional funding for S4C is necessary and also that, if it were, we should seek to provide for it in this way.
In conclusion, I have always found it advantageous to follow the advice given to me by my noble friend Lord Whitelaw on a whole variety of matters. I end by emphasising that we shall continue to take your Lordships' remarks very seriously in our continuing discussions with the channel.
Lord Cledwyn of Penrhos: My Lords, I cannot say that I am full of delight in responding to what the noble Lord said in his winding-up remarks. He could have been rather more constructive in his response, not only to what we said but to the feelings of the Welsh people at the present time. Nevertheless, he made one or two remarks which caused me to pause. He said—twice—that he would reflect on this debate and what has been said by noble Lords throughout the House. Secondly, he said that measures were being prepared but were not yet ready to be published or made known to Parliament. Let us hope that those measures will give us some measure of satisfaction.
Against that background, we realise that the Bill proceeds to another place. So there is ample opportunity for the noble Lord and his right honourable friend to consider very carefully the feelings on the Bill of noble Lords from the Principality in this House and at this time. I hope that he will do so. With those remarks, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 71 [Application of excess revenues of Channel Four Television Corporation]:
Lord Thomson of Monifieth Lord Thomson of Monifieth moved Amendment No. 14:
Page 61, leave out lines 34 and 35 and insert—
("(a) for paragraph (a) there is substituted—
"(a) subject to subsection (1A) of this section, pay 50 per cent. of the excess to the Commission; and", and").
The noble Lord said: My Lords, in moving this amendment I shall speak also to Amendments Nos. 15, 16 and 17. This series of amendments deals with the anomalies that lie in the financial relationships between
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Channel 4 and the ITV companies and the fact that what is meant to be a safety net for Channel 4 has become a rather large subsidy from ITV to Channel 4. The amendment also deals with the wider background, in a sense, of the financial relations between one ITV company and another. The two issues are linked and that affects the timetable that is proposed.
We have covered this ground a number of times during our proceedings on the Bill. It is fair to say that those on conflicting sides of the argument have both moved. On this side, we put forward our compromises. The latest is in the series of amendments that I now move. The Minister has also shown willingness to move and put forward his compromises. Those compromises are now set out on the consolidated list. The difference now left between us is not big but it is very important and not to be shrugged away.
On our side, we have conceded a timetable that moves a good way from the original desire for immediate abolition of the subsidy from Channel 4. It is a timetable which would reach zero by 1st January 1998 and during 1997 would reduce more gradually. The Minister at Report stage, characteristically ready to listen to the arguments of the House, moved very significantly indeed. We welcomed that at the time. He said that the Government were now ready to move and that the first reduction should take effect from 1998 and the second reduction would take effect from 1999. He then added these characteristically cautious ministerial words: "It is too early to say what the new levels will be". However, the Minister has shown himself ready in principle to make 1st January 1999 "zero date", if I may call it that. He is proposing in his amendments to provide the necessary legislative power for that possibility.
However, as I understand it, the Government are still unwilling to make a final commitment. I am making a last ditch stand tonight to seek to persuade the Minister to abandon his amendment and accept the arguments that I put forward for mine. Leaving uncertainty in the matter will continue to have a destabilising effect within the independent television system for the next couple of years while the final figures are haggled over. Other noble Lords no doubt received, as I did, representations from the Independent Television Association, which supports the Government's proposals rather than mine. I want to face that argument. I recognise the reasons for the Independent Television Association taking that view; but it is profoundly mistaken, even in its own interests.
Under the 1990 Act, 1998 is the year in which the contracts for the ITV companies are open for review. I am reinforced in my position by words from the well-known figure in the ITV world, Mr. Ward Thomas of Yorkshire Tyne Tees Television. He says that the view that I have been expressing, linking the problems of Channel 4 funding and ITV licence fees, is the way to resolve the issue. He said,
"This can be the only practical way of eliminating the continuing tad blood' within the system that you have referred to in the House".
Linked with the Channel 4 subsidy are the grotesque arrangements for the ITV companies paying their licence fees that emerged from the 1990 bidding

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process. To take a single example of those distortions, Midlands licensee, serving 4.5 million homes, by a magnificent piece of risk-taking, managed to end up paying £2,000 per annum for the privilege of serving the great Midlands area of this country, whereas Tyne Tees, serving 1.4 million homes, pays £15.1 million per annum. Those anomalies are as unsustainable as the anomaly of the subsidy from Channel 4 to the ITV companies.
Over the whole period of ITV until the totally mistaken and disastrous 1990 Act, there was an even-handed arrangement between all the regions in regard to the proper contributions that they should make to the Treasury. It was in fact only the 1990 Act which, for the first time, reduced that to a system of blind options and enormous disparities. I mention that because, if there was certainty that during 1998 the commitment from Channel 4 to the ITV companies was going to reduce and that from 1st January 1999 there would no longer be any subsidy, it would clear the air for negotiations between the ITC and those ITV companies which are seeking a review of the arrangements. The matter must be seen as a whole. From the point of view of the ITV companies, if the Government get away with the timetable that they are proposing, the water will be muddied in that negotiation and the ITV companies' ability to obtain a fresh start will be obscured by the fact that there is still a possibility of some element of subsidy from Channel 4.
It is for those reasons that I argue the merits of this series of amendments. Before I sit down I should perhaps explain what the amendments do. Amendment No. 14 is a consequential amendment and I need not waste time on it. Amendment No. 15 represents a substantial concession from the position that I have argued for so far in these proceedings. It has the effect of reducing to zero the thresholds at which Channel 4's revenues over the 14 per cent. of total national advertising revenue would be paid from 1999 onwards. It makes a transitional provision for the year 1998.
Amendment No. 16 has the effect of placing in legislation the intention that the Minister announced and which we welcomed at Report stage; that is, that the Channel 4 reserve fund should be capped following the enactment of the Bill and that no further payments into it would be required from Channel 4. Amendment No. 17 has the effect of permitting the Secretary of State the opportunity to vary the thresholds once more after the year 2002 when the present cycle of ITV contracts comes to an end and when the government of the day can properly take stock of the impact that the digital revolution is having on the broadcasting scene. At that time it will be amply proved that Channel 4 can stand on its own feet. I hope that I may be there to see it happen; who knows? I beg to move.
6 p.m.
Lord Birkett: My Lords, in rising to support Amendments Nos. 14 to 17, I am conscious that the Minister's Amendment No. 19 comes shortly after. It is a little like coming round the corner and finding oneself face to face with the sphinx. I hope the Minister will not mind if I describe his amendments as a little "enigmatic"
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as I should like to join in the tributes paid to him today for the sheer intelligence, courtesy and capability with which he has handled the Bill. I am full of admiration for him. I say the amendments are enigmatic. I wish I were prescient enough to read between the lines. However, your Lordships may agree that the words "may be nil but", do not give a lot of space for reading between the lines.
It is clear from everything said by the noble Lord, Lord Thomson, that the intention behind the amendments is to clear away the anomaly of Channel 4 having to pay out anything to ITV once the date of 1997—it is generally agreed that that is the right one—has passed. I am well aware that at Report stage the Minister indicated—if I get him wrong perhaps he will tell me immediately—that in 1999 that may be the case, but 1998 he thought would be the transitional year. It was at that time that he announced the concession of Channel 4 not having to pay into the reserve fund. I am sure that that will be welcome to Channel 4. However, there is a big difference between being obliged to put one's earnings into one's savings account and being obliged to pay them out via a thumping great bill to somebody else.
I can see no justification, after the end of 1997, for any payments to go forth either way. It has often been said in the course of these debates that we cannot foretell the future, particularly in the world of television. I have two comments to make in that regard. First, we can tell a jolly sight better now than we ever did in 1990 when this formula was invented. It was invented, of necessity, on guesswork and we now know that that guesswork proved wrong. Justice and common sense suggest that we put it right as fast as possible.
Secondly, who knows what will happen in the future to Channel 5? I cannot find an informed television commentator who thinks, however successful Channel 5 may be, that there is the smallest remaining danger of Channel 4 foundering, and therefore this formula having to be invoked. I cannot see any justification for thinking that Channel 4 may still be in danger. It seems to me therefore that if 1998 is to be a transitional year, the amount paid in that year ought to be absolutely tiny. As I said at Report stage if indeed it could be nil, as the Minister's amendment would make possible, that would be the best of all solutions. I hope that when the Minister replies he will give some indication of what 1998 will bring. If he gives any indication that it would be less than 15 per cent., I should be exceedingly happy and immediately cease to support this amendment. However, if he does not, I recommend to your Lordships that the figure of 15 per cent. is quite enough. I hope it is unnecessary.
Baroness Birk: My Lords, I rise to support these amendments which, but for some unfortunate error, should have had my name attached to them. It seems to me that it is virtually impossible to add to the steady stream of arguments in favour of freeing Channel 4 from the malfunctions of the 1990 funding formula which your Lordships have heard since Second Reading as we have gone through this in Committee, on Report and now at Third Reading.

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There was no way in 1990 of knowing how unfairly the funding formula would work out. Indeed, there are few, if any, who can argue that it has worked as Parliament originally intended. Had we known in 1990 how much effort it would take six years later to right an unintentioned wrong, I am sure things would now be very different. However, these amendments would provide the much needed clarity and certainty from which all sides would benefit and, as was explained by my noble friend Lord Thomson, they would also preserve the flexibility of a safety net which many of us would wish to see, and that safety net is not going to disappear by adopting these new amendments.
The ITC has said that payments from Channel 4 to ITV should cease after the end of 1997. It would seem sensible, therefore, to take steps to adopt that position as soon as possible. These amendments provide for just one more payment to ITV and then settle the matter at nil after 1998.
The latest briefing document I have seen from the ITV association states that it will need a "cushion" as the subsidy from Channel 4 is phased out. Cushions are usually reserved for the slothful couch-potato or for the brittle and unathletic and sometimes for those falling from a great height. ITV may tell us which is more applicable. Channel 4 estimates that this particular cushion will be worth about £25 million. This should be more than adequate, given the huge amounts it has already received from Channel 4.
As a direct consequence of the statements made by the Minister at Report stage, it is clear that the ITV companies can entertain no expectation of further revenues from Channel 4 after 1999. It was good that the Minister made that clear at that stage. But unless this conclusion is written into the Bill there will be a great danger that conflict between ITV and Channel 4 will continue. It would give certainty on this issue, although it is far from the ideal option of abolition which many of us were hoping would be accepted when we argued the matter in Committee. That was our first target, but we now seek to achieve an improvement with these amendments. Writing these provisions into the Bill is important. It is more important even than accepting the good word of the Minister. There is no doubt about what he said, but it does need to be on the face of the Bill.
It would seem that the amendments tabled by the Government will have little real effect. I hope to hear from the Minister, as the noble Lord, Lord Birkett, said, what extra they bring to the Bill. I too find that rather difficult to work out. They are certainly less than could have been expected from the Minister's comments at Report stage, when, as he is well aware, we were not able to see anything in writing. With that in mind, I am pleased to support these amendments, as they incorporate the Minister's express intention to cap the Channel 4 reserve fund. I hope the Government will support this proposal, as it will make a welcome change. It will ensure that these particular changes will be made to the Bill in this House before it goes to another place.
6.15 p.m.
The Earl of Stockton: My Lords, as at Report stage, I rise to support the noble Lord, Lord Thomson of Monifieth. However, I would like to preface my remarks on his amendments by reiterating my strong belief that there are no grounds of principle or public policy for continuing with this formula. There is, frankly, no reason why Channel 4 should continue to subsidise the ITV companies beyond the end of next year.
My noble friend's Amendments Nos. 18 and 19 are disappointing as well as being impenetrable in that they fail to deliver the expectation which he raised with us at Report stage. His statement then led us to expect a reduction of the payments in two stages, with the latter set at zero. Pending consideration of this, an amendment to end the payments at the end of 1997 was withdrawn. But what he now proposes offers nothing that will guarantee a reduction in two phases; it merely sets the powers to do so at a later stage.
At Report stage we were led to believe that, in line with the ITC position, the second stage would be a reduction of the payments to zero. Now that promise is simply a "maybe". My noble friend's amendments say that these payments "may be nil". That means that the payments may vary anywhere from 50 per cent.—that is £80 million—to nil. It means that they may be altered any, or, indeed, every, year. It means that they may be altered in any way. It means that they may rise as well as fall. That must be a recipe for continuing conflict and for endless lobbying by ITV and Channel 4 at a time when they should be co-operating to introduce digital television. I would have preferred simply to alter "may" to "shall".
The amendment of the noble Lord, Lord Thomson, is itself a compromise. The board of Channel 4 has quite reasonably asked to be relieved from the end of 1997 of a formula which was designed to help it but which everybody now accepts is draining substantial funds from programme making. The amendment asks for an additional—in my view unjustified—payment for 1998. What it offers, however, is that element of certainty which is so badly needed. Without certainty, Channel 4 will find it extremely difficult to plan its film, programme and digital investment budgets for the years following 1997, and without certainty the debilitating wrangling will continue.
This compromise must surely answer all the Government's concerns. The safety net will remain in place, even though Channel 4 does not want it or need it. The Secretary of State will still have power to vary the percentage of qualifying revenue on which the formula is based and so manage any dramatic fluctuation in later years. Nothing more is now needed other than certain figures by which the formula is to be phased out.
I shall be most interested to hear what my noble kinsman Lord Arran, the noble Viscount, Lord Astor, or the noble Lord, Lord Howell, speaking as they do with great affection and support severally and collectively for the independent television companies, have to say in answer to this. By the by, I would also like to ask my noble friend the Minister, who has considerable

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experience at a European level, how he believes that any continuing subsidy payments to ITV after 1997 can pass scrutiny by the commission, since the funding formula was registered as state aid with the sole purpose of supporting Channel 4.
My noble friend the Minister has himself conceded that early action needs to be taken to stop the payments from Channel 4 to ITV. Those words, "early action", are his in col. 443 of the Official Report of 7th March. So action—and action on the face of the Bill—is what we need. Intentions, statements, promises and maybe's are not enough. They cannot bind this Government or any future government and they do not in my view respond to the widespread agreement among many of your Lordships that we ought to put right in this Bill what has clearly gone wrong in the last one.
Lord Crickhowell: My Lords, there is a certain familiarity about this debate. There have been a number of previous rounds, although unavoidably I missed the last one. However, I have carefully read what was said on 7th March. On this occasion, as on previous occasions, I must declare an interest as a director of an ITV company, HTV.
I was glad that the noble Lord, Lord Thomson of Monifieth, brought us back to the gap year. I had looked at his amendment with a certain amount of surprise, noting as I did the absence from the Marshalled List of another amendment from him on the gap year. I well recall him saying when we debated the gap year that he would be looking closely again at the issue and might well return to it. At that time I said that I would support him. But the impact of his amendment is in a sense to bring that issue right back to the fore again. My noble friend the Minister argued on 7th March that effectively the compromise he advanced had gone a long way to close the gap. That was acknowledged at the time by the noble Lord, Lord Thomson of Monifieth. But, by now accelerating the process, the issue is inevitably reopened.
The noble Lord, Lord Birkett, said that we can foresee better than we could in 1990. But back in 1990 the television companies which were bidding—those that did not get their licences had the same problem—had to bid into a very deep fog indeed. The noble Lord, Lord Thomson of Monifieth, is right in saying that the two points need to be looked at together. If a violent change is to happen at the end of 1997 there has to be a re-examination of the total position and not just a part of it The noble Lord is proposing a fairly sharp change—a reduction in one year of two-thirds of the money at present going to Channel 4 companies. I am not arguing for a moment that there does not need to be a phasing out of these arrangements but it seems to me that the Government are right in saying that it is sensible to leave flexibility and to set the rate of phasing in the light of circumstances as they are in 1997. Only then will we be able to gauge the impact of Channel 5, measure the impact of the proposed digital or satellite channels—there could he a large number of themߞand take account of the economic climate and the impact on the Channel 3 companies in the light of the advertising revenue for those companies at that time.
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The Government put forward a particularly sensible compromise on the last occasion, in that it allowed for some adjustment at the time in the light of circumstances. I find myself in perhaps the rather unusual position in debates in this House, in which I have sometimes been a little difficult with my noble friend, of being the first person to speak in favour of the Minister's solution as advanced on Report. I believe that he got it right then and I hope he will stick to that solution.
I have only one other thought to put to him. He said that, as the payment for 1997 is made in 1998, that in effect eliminates the gap year and is a factor to be taken into account. He referred to the fact that that was a cash flow impact. But in terms of the way in which companies do business and prepare their accounts—this is the almost universal practice—they account for those funds in the year to which they refer. Therefore, in planning their expenditure and their income, they relate to the year to which they refer and not to the fact that the cash comes in a month or two later. That is a cash flow impact. It is not an accounting impact; it is not the basis on which companies can plan their business. My noble friend must consider that matter but stick to his guns and retain the flexibility that he has given himself. I hope that he will reject the amendment.
Viscount Astor: My Lords, I support the argument put forward by my noble friend Lord Crickhowell. As he said, we are now in the third round of this debate. If that proves anything, it proves that my noble friend the Minister, by giving two substantial concessions to Channel 4, instead of making it absolutely satisfied, aroused in Channel 4 an appetite for more and more. To give more would be a mistake. The amendment of the noble Lord, Lord Thomson, seeks further to amend the Government's compromise amendment. I believe that the Government's compromise has balanced the interests between ITV and Channel 4. Peace has broken out. There is no conflict any more.
It is right that we should not seek to prescribe precisely what the levels of the payment should be from January 1998, therefore allowing discussions to take place before the end of 1997. I share the Government's view that a review should be conducted at that time, when judgments can be made about the impact of competition. The noble Lord, Lord Birkett, said that he can see into the future more clearly than we could in 1990. He may be right. He may have a better crystal ball than us. But I have to say to the noble Lord that Channel 5 will come before us and the experts in the industry say that by the year 2000 it could be taking 7 per cent. of the revenue. We know that satellite and cable will expand rapidly and the Government say that digital and satellite will come before us very quickly. It is important that the Government should maintain flexibility. The Government made substantial concessions to Channel 4. We do not know what will happen. No one will lose anything by retaining this flexibility. I therefore urge your Lordships to reject the amendment.
Baroness O'Cathain: My Lords, as the noble Lord, Lord Thomson, said, we had full and frank debates on the Channel 4 funding formula during the Committee and Report stages and as a result the amendments tabled on that issue were withdrawn. At the same time the Government announced that they would cap Channel 4's reserve fund, thereby increasing its programming budget by at least £30 million or by 10 per cent., and that they would review the formula in 1997 with the intention of reducing the money received by ITV. In the light of that it seems to me that Channel 4 has already done very well out of the contribution to the debate in your Lordships' House and I would therefore urge your Lordships to hold back from giving Channel 4 any further concessions.
My main reason for this seemingly hard line is that, as the Broadcasting Bill reaffirms, the present formula was designed to remain in place until 1998, when it could be amended following a review in 1997. It should really be at that point and not before that the exact levels at which the formula should be set for the future are debated. We really will, as many noble Lords have said, have a clearer idea by the end of 1997 of the impact of Channel 5 and of the growing importance of cable and satellite.
The amendment tabled by the noble Lord, Lord Thomson, obviously pre-empts the end of 1997 review by specifying the precise amount of money to be received by ITV. It has been clear from the outset of this debate on the funding formula that it is only one part of a very complicated web of funding arrangements which sustain both Channel 4 and ITV. Any change to any part of the arrangements could therefore have a serious and damaging impact on the UK's commercial television sector. I honestly do not believe that it is good practice to fiddle with one part of a contract, if one likes, while leaving the other untouched.
The intention of the amendment is effectively to bring forward the 1997 review without giving due consideration to the many factors at play. That could result in a decision being made in this House that would damage the quality of service provided to viewers. Noble Lords will remember that in Committee I pointed out the apparent disinterest of Channel 4 to spend its increased programme budgets on UK material, preferring instead to invest in cheap US programmes. Since that date I have had a letter from the chief executive of Channel 4, Mr. Michael Grade. He says,
"You may not know that the Board of Channel 4 has committed publicly to spending every penny of its revenues released by abolition"—
that is abolition of the funding formula—
"on British film and television production (and training). The whole purpose of redressing the funding formula iniquity is to substitute home grown for imports".
Despite that, like my noble friend Lord Crickhowell, I support the amendment produced by my noble friend the Minister. Channel 4 has the assurance that the review will take place at the end of 1997 and we should wait until then. Therefore, I urge your Lordships to reject the amendment.
6.30 p.m.
Lord Inglewood: My Lords, the noble Lord, Lord Thomson of Monifieth, explained that his amendment to Clause 71 aims to provide on the face of the Bill that Channel 4 should make no further payments to its reserve and that the payment from Channel 4 to Channel 3 companies for 1998 should be set at 15 per cent. of Channel 4's income above the statutory threshold; and that no payments should be made for the four years thereafter. With your Lordships' permission, in my comments on this amendment, I shall also speak to government Amendments Nos. 18 and 19, which have been referred to and which cover related issues.
As I have explained on previous occasions, the Government want to retain the Channel 4 funding formula as a prudential measure but to operate it flexibly so that Channel 4 can retain more of its income for programming. I have indicated our intention to take early action to cap Channel 4's payments into the reserve, and Amendment No. 19 duly makes this possible. As to Channel 4's payments to Channel 3—in effect, an insurance premium against the guarantee of minimum income payable by Channel 3, which will remain in force—I explained that the Government intend to proceed by a phased approach, with the first reduction taking effect from 1998 and the second from 1999. Our overall expectation is a significant adjustment in Channel 4's favour. Amendment No. 18, which I have tabled, will in principle allow a reduction in Channel 4 payments to Channel 3 to zero from 1999. This general approach is intended to establish a way forward which is fair to all concerned.
The amendment of the noble Lord, Lord Thomson, reflects the Government's thinking on continuation of the funding formula, on immediate termination of payments into the reserve and on the phasing of reductions of Channel 4 payments to Channel 3. I very much welcome this growing consensus on the way forward. But there is a significant difference as against the Government's approach in the proposal to set the precise level of Channel 4 payments to Channel 3 for each year from 1998 to 2002 on the face of legislation. The Government's view is that this approach is a mistake, for reasons both of principle and of practicality.
As far as the proposal to set a 15 per cent. payment for 1998 is concerned, it has been argued that it is necessary to establish certainty for Channel 4 now. I do not find this argument convincing. Even were we to establish a figure now, there would remain uncertainty for Channel 4 as to the actual amount of their payment for 1998. After all, that will depend on two variables which cannot yet be established. The first is the level of the total television revenues for the relevant year, which forms the basis for the threshold above which the formula comes into effect; and the second is the level of Channel 4's own revenues for 1998. For those reasons I believe that the arguments based on certainty are perhaps overdone.
In response to the point made by the noble Lord, Lord Birkett, I am not persuaded that 15 per cent. is necessarily the right figure. That will need to be established against updated estimates of television

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revenue, market and sectoral developments and other relevant matters nearer the time. That point was made by my noble friend Lady O'Cathain. For those reasons the Government are opposed to the proposition that Channel 4's 1998 payments should now be set at 15 per cent. on the face of the statute.
The second limb of the proposal put forward by the noble Lord, Lord Thomson, is that Channel 4's payments for the four subsequent years from 1999 to 2002 should be established by statute at zero. As I indicated, the Government's own amendment would in principle allow zero payments from that year. But here also it is simply too early to take a final and definitive view of payment levels up to six years from now. Moreover, establishing the figures in primary legislation, as the amendment proposes, would rule out all prospect of subsequent adjustment in the years up to 2003 were that to be deemed sensible subsequently. Such an approach would be inconsistent with the need for flexibility to respond to fast-moving developments in the broadcasting sector. For those reasons the Government oppose this element of the amendment of the noble Lord, Lord Thomson, as well.
The Government recognise that it must be for Parliament to decide on the precise levels of funding to be established within the revised formula. That is why we have proposed that they should be set by order subject to affirmative resolution. Such an approach is wholly in line with the approach which Parliament adopted in relation to variations to the formula in the 1990 Act. It allows well-informed judgments about appropriate levels after proper consideration and consultation at the appropriate time. It is consistent with the need for flexibility, which is a key principle underlying the formula itself.
My noble friend Lord Stockton expressed some concern about the Government's policy. I can do no better than other noble Lords have done and refer to the second day of the Report stage of the Bill. With the leave of your Lordships, perhaps I may quote:
"As a second step, we propose to introduce reductions to Channel 4 payments to Channel 3 in two phases. The first reduction will take effect from 1998; the second will take effect from 1999. It is too early to say what the new levels would be, but we have indicated that we expect significant adjustment in Channel 4's favour, and we are taking powers which would in principle enable us—if we so judge nearer the time and Parliament agrees—lto reduce Channel 4 payments to Channel 3 to zero from 1999. Whatever the final level, there would be a stepped reduction towards it from 1998".— [Official Report, 7/3/96; col. 443.]
The importance of that passage is that it is clear what our policy is. I appreciate that some noble Lords may not agree with it and might wish that it were something different. However, bearing in mind the appropriateness of Parliament taking a final decision, it is a perfectly proper way to proceed. It also indicates to the world generally what our policy is now. As I explained, we take the view that this is not the right time to decide a final figure for what might be a significant amount of money at some considerable time in the future.
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There is one final point I wish to touch on. It has been argued that we must finalise the amounts of funding now in order completely to clarify matters. I believe it is clear that the amendment of the noble Lord, Lord Thomson, would not achieve that because of the very nature of the formula we are talking about which contains a number of variables that interrelate. As my noble friend Lady O'Cathain said, that in turn is part of a wider matrix of the funding arrangements for Channels 3 and 4 broadcasters.
As regards Channel 4 funding arrangements, we have put forward a proposal, supplemented by the amendments I have now tabled, which, we believe, as my noble friend Lord Crickhowell, acknowledged, attempts to strike a balance between all the relevant interests and retain sufficient flexibility to establish fair figures. It is for those reasons that I hope the amendments will commend themselves to your Lordships.
Lord Thomson of Monifieth: My Lords, I do not want to detain the House, but perhaps I should explain to the noble Lord, Lord Crickhowell, that I did not table a separate amendment about the gap year because I was trying to be as economical as possible with my amendments at this late stage in our consideration of the Bill and I thought that I might deal with the matter by putting it in a wider context in my remarks.
I thought that the Minister made a curious remark—perhaps I did not pick it up correctly—when he said that even my amendment did not create certainty. I cannot think of anything more certain from Channel 4's point of view than to know that from 1st January 1999 its payments would cease; that its payments would be zero. I cannot think of anything more certain than zero.
The usual remark that one would make to the Minister—we have had many opportunities to say it because, as far as was possible within the limits of government policy, he has been a most accommodating and helpful Minister—is that one wants to read and study carefully what he has said and perhaps return to it later. Suddenly and sadly, I remember that we shall not be able to return to this later. However, other people further along the corridor and in another place will have the opportunity to consider these matters later.
I was greatly encouraged by what the Minister said on Report. Incidentally, I have subsequently examined his remarks carefully. In my innocence I had thought that my amendment was such an olive branch and was so reasonable—I wrote to the Minister to tell him about it in advance—that I fully hoped that he would say that he did not want to waste your Lordships' time and was happy to accept it. However, when I saw the Minister's amendment I knew that I was sunk. Against that background, I beg leave to withdraw my amendment.

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Amendment, by leave, withdrawn.
[Amendments Nos. 15 to 17 not moved.]
Lord Inglewood Lord Inglewood moved Amendment No. 18:
Page 62, line 4, after ("which") insert ("may be nil but").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Lord Inglewood Lord Inglewood moved Amendment No. 19:
Page 62, line 7, at end insert ("which may be nil").
On Question, amendment agreed to.
Lord Inglewood Lord Inglewood moved Amendment No. 20:
After Clause 77, insert the following new clause—
("PART IVA
SPORTING AND OTHER EVENTS OF NATIONAL INTEREST
LISTED EVENTS
.—(1) For the purposes of this Part, a listed event is a sporting or other event of national interest which is for the time being included in a list drawn up by the Secretary of State for the purposes of this Part.
(2) The Secretary of State shall not at any time draw up, revise or cease to maintain such a list as is mentioned in subsection (1) unless he has first consulted—

(a) the BBC,

(b) the Welsh Authority,

(c) the Commission, and

(d) in relation to a relevant event, the person from whom the rights to televise that event may be acquired;

and for the purposes of this subsection a relevant event is a sporting or other event of national interest which the Secretary of State proposes to include in, or omit from, the list.
(3) As soon as he has drawn up or revised such a list as is mentioned in subsection (1), the Secretary of State shall publish the list in such manner as he considers appropriate for bringing it to the attention of—

(a) the persons mentioned in subsection (2), and

(b) every person who is the holder of a licence granted by the Commission under Part I of the 1990 Act or a digital programme licence granted by them under Part II of this Act.

(4) In this section "national interest" includes interest within England, Scotland, Wales or Northern Ireland.
(5) The addition of any relevant event to such a list as is mentioned in subsection (1) shall not affect—

(a) the validity of any contract entered into before the date on which the Secretary of State consulted the persons mentioned in subsection (2) in relation to the proposed addition, or

(b) the exercise of any rights acquired under such a contract.

(6) The list drawn up by the Secretary of State for the purposes of section 182 of the 1990 Act, as that list is in force immediately before the commencement of this section, shall be taken to have been drawn up for the purposes of this Part.").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Lord Inglewood Lord Inglewood moved Amendments Nos. 21 to 28:
After Clause 77, insert the following new clause—
CATEGORIES OF SERVICE
(".—(1) For the purposes of this Part television programme services shall be divided into two categories as follows

(a) such of the services specified in subsection (2) as are provided without any charge being made for the reception of programmes included in the service, and

(b) all television programme services not for the time being falling within paragraph (a).

(2) The services referred to in subsection (1)(a) are—

(a) regional and national Channel 3 services,

(b) Channel 4, and

(c) the television broadcasting services provided by the BBC.

(3) The Secretary of State may by order amend subsection (2) so as to remove any service from, or add any service to, the services specified in it.
(4) An order under subsection (3) shall be subject to annulment in pursuance of a resolution of either House of Parliament.").
Insert the following new clause—
CONTRACT FOR EXCLUSIVE RIGHT TO TELEVISE LISTED EVENT TO BE VOID
(".—(1) Any contract entered into after the commencement of this section under which a television programme provider acquires rights to televise the whole or any part of a listed event live for reception in the United Kingdom, or in any area of the United Kingdom, shall be void so far as it purports, in relation to the whole or any part of the event or in relation to reception in the United Kingdom or any area of the United Kingdom, to grant those rights exclusively to any one television programme provider.
(2) In this Part "television programme provider" means the BBC, the Welsh Authority or any person who is the holder of any licence under Part I of the 1990 Act or a digital programme licence under Part II of this Act.
(3) For the purposes of this section rights to televise the whole or any part of an event live for reception in any area granted to a television programme provider are granted exclusively if the person granting them—

(a) has not granted any such right to any other television programme provider, and

(b) is precluded by the terms of the contract from doing so.). Insert the following new clause—

CONTRACT FOR TELEVISING LISTED EVENT MUST SPECIFY CATEGORY OF SERVICE
(".—(1) Any contract entered into after the commencement of this section shall be void so far as it purports to grant to a television programme provider rights to televise the whole or any part of a listed event live for reception in the United Kingdom, or any area of the United Kingdom, unless the contract complies with subsection (2).
(2) A contract complies with this subsection if the terms of the contract allow the television programme provider to include the live coverage of the listed event—

(a) only in a television programme service falling within paragraph (a) of subsection (1) of section (Categories of service), or

(b) only in a television programme service falling within paragraph (b) of that subsection.")

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Insert the following new clause—
RESTRICTION ON TELEVISING OF LISTED EVENT
(".—(1) A person providing a service falling within either of the categories set out in subsection (1) of section (Categories of service) ("the first service") for reception in the United Kingdom or in any area of the United Kingdom shall not, without the previous consent of the Commission, include in that service live coverage of the whole or any part of a listed event unless—

(a) another person, who is providing a service falling within the other category set out in that subsection ("the second service"), has acquired the right to include in the second service live coverage of the whole of the event or of that part of the event, and

(b) the area for which the second service is provided consists of or includes the whole, or substantially the whole, of the area for which the first service is provided.

(2) The Commission may revoke any consent given by them under subsection (1).
(3) Failure to comply with subsection (1) shall not affect the validity of any contract.
(4) Subsection (1) shall not have effect where the television programme provider providing the first service is exercising rights acquired before the commencement of this section.").
Insert the following new clause—
POWER OF COMMISSION TO IMPOSE PENALTY
(".—(1) If the Commission—

(a) are satisfied that the holder of a licence under Part I of the 1990 Act or a digital programme licence under Part II of this Act has failed to comply with subsection (1) of section (Restriction on televising of listed event), and

(b) are not satisfied that in all the circumstances it would be unreasonable to expect him to have complied with that subsection,

they may require him to pay, within a specified period, a specified financial penalty to the Commission.
(2) If the Commission are satisfied that, in connection with an application for consent under subsection (1) of section (Restriction on televising of listed event), the holder of a licence under Part I of the 1990 Act or a digital programme licence under Part II of this Act has—

(a) provided them with information which was false in a material particular, or

(b) withheld any material information with the intention of causing the Commission to be misled,

they may require him to pay, within a specified period, a specified financial penalty to the Commission.
(3) The amount of any financial penalty imposed on any person under subsection (I) or (2) shall not exceed the amount produced by multiplying the relevant consideration by the prescribed multiplier.
(4) In subsection (3)—

(a) "the relevant consideration" means an amount determined by the Commission as representing so much of any consideration paid by the person on whom the penalty is being imposed as is attributable to the acquisition of the rights to televise the event in question, and

(b) "the prescribed multiplier" means such number as the Secretary of State may from time to time by order prescribe.

(5) An order under subsection (4)(b) shall be subject to annulment in pursuance of a resolution of either House of Parliament.
(6) Where the Commission receive any amount payable to them by virtue of subsection (1) or (2), that amount shall not form part of the revenues of the Commission but shall be paid into the Consolidated Fund.
(7) Any amount payable by any person to the Commission by virtue of subsection (1) or (2) shall be recoverable by them as a debt due to them from that person.").
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Insert the following new clause—
REPORT TO SECRETARY OF STATE
("—(1) If the Commission

(a) are satisfied that a broadcasting body has failed to comply with subsection (1) of section (Restriction on televising of listed event), and

(b) are not satisfied that in all the circumstances it would be unreasonable to expect the body to have complied with that subsection,

they shall make a report on the matter to the Secretary of State.
(2) If the Commission are satisfied that, in connection with an application for consent under subsection (I) of section (Restriction on televising of listed event), a broadcasting body has

(a) provided them with information which was false in a material particular, or

(b) withheld any material information with the intention of causing the Commission to be misled,

they shall make a report on the matter to the Secretary of State.
(3) In this section "broadcasting body" means the BBC or the Welsh Authority.").
Insert the following new clause—
CODE OF GUIDANCE
(".—(1) The Commission shall draw up, and may from time to time review, a code—

(a) specifying the circumstances in which the televising of listed events generally, or of a particular listed event, is, or is not, to be treated as live for the purposes of this Part, and

(b) giving guidance as to the matters which they will take into account in determining—

(i) whether to give or revoke their consent under section (Restriction on televising of listed event)(1), or

(ii) for the purposes of section (Power of Commission to impose penalty)(1) or (Report to Secretary of State)(1), whether in all the circumstances it is unreasonable to expect a television programme provider to comply with section (Restriction on televising of listed event)(1).

(2) In exercising their powers under this Part, the Commission shall have regard to the provisions of the code.
(3) Before drawing up or revising the code the Commission shall consult such persons as appear to the Commission to be appropriate.
(4) As soon as the Commission have drawn up or revised such a code, the Commission shall publish the code in such manner as they consider appropriate for bringing it to the attention of—

(a) the BBC,

(b) the Welsh Authority,

(c) every person from whom the rights to televise a listed event may be acquired, and

(d) every person who is the holder of a licence granted by the Commission under Part I of the 1990 Act or a digital programme licence granted by them under Part II of this Act.").

Insert the following new clause—
INTERPRETATION OF PART IVA AND SUPPLEMENTARY PROVISIONS
(".—(1) In this Part (unless the context otherwise requires)—
"Channel 4" has the same meaning as in Part I of the 1990 Act;
"the Commission" means the Independent Television Commission;
"listed event" has the meaning given by section (Listed events)(1);
"live" shall be construed in accordance with the code drawn up under section (Code of guidance);
"national Channel 3 service" and "regional Channel 3 service"
have the same meaning as in Part I of the 1990 Act;

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"television broadcasting service" has the same meaning as in Part I of the 1990 Act;
"television programme provider" has the meaning given by section (Contract for exclusive right to televise listed event to be void)(2);
"television programme service" has the same meaning as in Part I of the 1990 Act.
(2) Section 182 of the 1990 Act (certain events not to be shown on pay-per-view terms) shall cease to have effect.").
The noble Lord said: My Lords, I have already spoken to these amendments. I beg to move them en bloc.
On Question, amendments agreed to.
6.45 p.m.
Baroness David Baroness David moved Amendment No. 29:
After Clause 78, insert the following new clause—
BSC TO PROVIDE GUIDANCE FOR EDUCATIONAL BROADCASTS
(" · It shall be the duty of the BSC to draw up, and from time to time review, guidance as to standards and practices to be followed in connection with programmes which fulfil the obligation of the BBC to provide—

(a) education; and

(b) educational content.").

The noble Baroness said: My Lords, this amendment places on the new Broadcasting Standards Commission a duty to draw up and review guidance on the content and nature of broadcasting defined as "education" and that which has some educational content. We want to see some such provision appear on the face of the Bill.
This amendment was moved at Committee stage by my noble friend Lady Farrington. Replying to the debate at that stage the Minister said that,
"The amendment … seeks to treat the BBC on a different footing from … other public service broadcasters".—[Official Report, 15/2/96; col. 822.]
In fact, this amendment seeks to bring the BBC in line with other public service broadcasters, as the independent terrestrial television companies and Channel 4 are regulated by the ITC. The BBC is unique in that its education programmes are not monitored and evaluated by any independent body. Channel 4 has a minimum number of hours for schools programmes but there is still no such requirement for the BBC. The Agreement between the Secretary of State and the BBC requires the BBC,
"to have programmes of an educational nature…as well as formal education".
This loosely worded double requirement allows the BBC to blur the distinction between education programmes and programmes with some educational content. This amendment separates the two elements, thereby requiring the nature of each to be understood and addressed.
At present, the Bill provides that the Broadcasting Standards Commission will have responsibilities in two areas: first, the treatment of individuals in respect of fairness and privacy; and secondly, standards of taste and decency. Both of those involve it reacting to actual or potential broadcasts. Placing a third responsibility on the Commission to ensure high standards in education
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broadcasting and broadcasting with some educational content will allow it to adopt a positive role which will set an example to the other public service broadcasters.
The need for an amendment of this kind arises from concern about the changes which seem to have occurred in the BBC's education broadcasting provision over the last year. The BBC is seeking higher ratings by diluting its education mission. Evidence of this dilution is provided by the fact that the chat show "Esther", presented by Esther Rantzen, the antiques quiz show "Going for a song" and the entertainment programme "Ruby's Health Quest", as well as "My Brilliant Career", the documentaries about failed businessmen, are all examples of programmes which have been funded by the education budget. I know the arguments which the BBC puts forward to justify such programmes.
The BBC's ring-fenced budget for adult education, Education for Adults, is now being transferred into general programming and the controllers of BBC 1, Alan Yentob, and of BBC 2, Michael Jackson, have effectively been given the power to decide what programmes are educational and who should make them.
At this point I want to remind your Lordships that this is the International Year of Life-Long Learning. This very morning I received a document from the National Institute of Adult Continuing Education, its response to the Government's consultation document on lifetime learning. I should like to read from its page on broadcasting. It states:
"The 1990 Broadcasting Act ended the obligation on terrestrial independent television companies to provide educational programming for adults. Yet all the evidence points to the importance television can play in reaching under-participating groups free at the point of use in their own homes, and motivating people to participate in education and training activities …
The adult literacy campaign of the 1970s was kick started by prime time television, through BBC's On the Move.
Adult Learners' Week each year includes programming on all channels backed by a freephone helpline, attracting some 50,000 people, more than half of whom are unemployed to phone seeking opportunities for adult learning. An impressive number turn the enquiry into active enrolment. The BBC/ALBSU"—
that is the learning programme for those with learning difficulties—
"Family Literacy adverts in 1995 stimulated 350,000 people to phone for family literacy packs. Terrestrial television is still a major influence on the lives of Britain's adults, and is likely to remain so".
It is important that programmes are available at prime time. It is because people just happen on these programmes that they have such an effect. They are not going to video programmes—they may well not have a video—and if they are broadcast at midnight they are not going to get them and the whole effect will go.
We want to encourage regulators to approve programming designed to motivate, like short promotional sketches. At the same time, the Government should welcome the development of dedicated programming, like that on the Learning Zone, which reaches already committed learners, while—and this is important—maintaining an obligation on the BBC and Channel 4 to provide accessible programming for

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adult learners during prime time evening slots, as well as after midnight and in the afternoon. I hope that that plea from the national institute will have some effect.
Seventy per cent. of programmes will be made by independents or other BBC departments. The BBC justifies this change by contending that any factual programme-maker can make education programmes. The BBC is reducing the number of new television programmes it is making for schools. It will be making only 90 hours a year, fewer programmes than Channel 4 is required to make for schools. The BBC is also asking producers who have no experience of making schools programmes to start making them.
Schools programmes require very different skills from those needed to make mainstream television programmes. One important reason for that is that schools programmes need to follow the national curriculum and need to be a suitable resource which teachers can pursue effectively in the classroom. With favourite and memorable programmes such as "You and Me", "Storytime" and, more recently, "Come Outside" and "Hotch Potch House", the BBC has built a distinguished reputation in programmes for the under-fives. The programmes carefully lay firm foundations for children before they enter school. These programmes will all disappear, replaced by a daily programme made by children's entertainment producers. There has been no involvement from the BBC's education policy unit in supervising a proper education framework for the programmes. This has resulted in the distinction between education programmes and programmes with some education content being blurred.
While this amendment seeks guidance for both categories, its purpose is to ensure that the content and methodology of education programmes meet, and continue to meet, the highest standards of production practice. This includes ensuring that any curriculum requirements are met; that proper account is taken of changes in teaching practice; that the programme is appropriate to the age and other characteristics of the intended audience; and that effectiveness of the programme (or series) in fulfilling its educational function is evaluated.
Only if those and similar criteria are met will it be possible for the BBC to fulfil its obligation to disseminate education, which is expressed in the draft Charter and the draft Agreement. I wish to make it clear that I have great belief in the BBC and I very much respect what it does. I believe that, because of the need to keep up its ratings and because of the money involved, it has perhaps been forced into doing what I have been complaining about in the amendment. I strongly believe that provision for education should be written on the face of the Bill and I hope that the Minister will appreciate my keenness in wanting to provide that in the amendment. I beg to move.
Lord Donoughue: My Lords, perhaps I may add briefly to what my noble friend said and make a couple of general points which go wider than the BBC, though including it. There is no provision in the Bill to enable education to benefit from the greater scope and opportunity for choice and for specialist broadcasting,
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such as education, which is provided by the digital revolution. That is the positive side and the positive opportunity that is missed.
The negative side relates to a time in the future when the BBC and Channel 4 analogue services cease; when they are switched off. We shall then be left with the digital multiplex providers sitting on 12-year licences with renewal who will have no educational obligations whatever. All that we have helping education are the commitments in the BBC Charter for 10 years ahead. However, as I and other noble Lords pointed out when we debated the matter, those commitments have already been weakened.
Britain last had an opportunity to establish a specific education channel when BSB left the Marco Polo satellite vacant. That opportunity was not taken. We now have a new opportunity with digital television and this Bill and it would be wrong and sad to miss it again. I hope that the Government, in anything that the Minister can say today or in proceedings in another place, will find a way to improve the guarantees for educational broadcasting and in particular to write that into the Bill.
Lord Inglewood: My Lords, I expect that it will come as no surprise to the noble Baroness, Lady David, when I say at the outset that this is a matter for the Governors of the BBC and not for the BSC. The BBC's obligations in respect of the provision of educational programming are contained in its Charter and Agreement and it is for the Governors to ensure that those obligations are met. Similar obligations are placed on independent broadcasters under the 1990 Act. I do not believe that this is an area in which the BSC can usefully, or indeed appropriately, play a part, nor do I believe that it is desirable to single out the BBC or any other broadcaster for special treatment by the BSC, however important the sector may be, as is clear in this instance.
The BBC's record of providing educational programming is impressive. This year, BBC Education will broadcast over 4,200 hours of programmes. Nearly 80 per cent. of primary schools use BBC broadcasts. The BBC has operated in partnership with the Open University since 1970 and broadcasts over 2,000 Open University programmes on television and radio each year.
The BBC's new Charter and Agreement includes a new requirement in Clause 32(e) of the Agreement that home services:
"contain programmes of an educational nature (including specialist factual, religious and social issues programmes as well as formal education and vocational training programmes)".
We have discussed the matter in a different context and on a number of occasions during debates on the Bill. There are a variety of ways in which those who believe that the BBC may not be honouring its obligations can take that matter forward. As I intimated earlier, I do not believe that what the noble Baroness proposes is an appropriate extension of those means. The BBC has also set out its aim to develop and strengthen educational programming over the coming years. It is increasing

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funding to the tune of an additional £1.5 million for the Education Directorate for the next year and is increasing broadcast hours of educational programmes.
The noble Lord, Lord Donoughue, painted a bleak and I believe unfair picture of the future of educational broadcasting. In the digital world the existing public service broadcasters will still be subject to the existing criteria in respect of educational matters. In addition, looking at the way in which the multiplex licences are to be allocated one sees that the core criterion as regards the services is that there should be variety. Within that variety there is great potential for educational services. Those who want to achieve multiplex licences must look to a wide range of programmes, which includes possible educational programmes.
I believe that a fair picture of the future is not emerging in front of us; it is said that there will be a desert for education. The Government see the amendment as unnecessary and an entirely unjustified expansion of the BSC's remit into a new area. For those reasons we would resist it.
Baroness David: My Lords, I thank the Minister for his careful answer. As he said, it was not altogether unexpected, particularly his comments about attaching the amendment to the BSC. I hope that his predictions will prove to be correct: we shall be watching most carefully. I am most anxious about those adults who have not had a good education and about young people who have missed out and at 16, 17 or 18 are not sure what they want to do. They may happen to see such programmes quite by accident and may be taken with them. They may then decide that they want to go on to further education or to obtain some qualifications. I am afraid that such people may miss out.
We shall be watching the situation carefully and I hope that provisions for education can be put on the face of the Bill and pursued a little further in another place. Clearly, at this time the only suitable thing for me to do is to beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
7 p.m.
Clause 79 [Power to publish guidance relating to avoidance of unjust or unfair treatment or interference with privacy]:
Lord Inglewood Lord Inglewood moved Amendment No. 30:
Page 68, line 8, leave out ("guidance relating") and insert ("a code giving guidance as").
The noble Lord said: My Lords, in moving this amendment I shall speak also to Amendment No. 31.
Your Lordships will recall the debates which we had during Committee and Report stages where the noble Lord, Lord Chalfont, and others proposed a number of amendments intended to change the wording used in the Bill to describe the BSC's "guidance" on fairness. The Government have listened carefully to the concerns of those noble Lords, and have, after careful consideration, decided that the existing wording is, indeed, anomalous.
The Government's Amendment No. 30 is therefore intended to rename the existing "guidance" as "a code giving guidance". That will have the effect of standardising the form of words used across the broadcasting spectrum: in the Bill, in the 1990 Act, and in the BBC's new Charter and Agreement.
I am aware that some noble Lords would prefer the Government to go further. However, the Government remain satisfied that the form of words used here is sufficiently clear and has been effective in the past.
The Government have also reconsidered the role of the BSC's fairness code, and the Government's Amendment No. 31 would require broadcasting and regulatory bodies to reflect that code in drawing up or revising their own guidance, just as they are at present required to do in respect of the BSC's standards code. I beg to move.
Viscount Caldecote: My Lords, in Committee I moved a similar amendment designed to strengthen the clause. Amendment No. 30 accepts very largely the principle which I tried to put forward. Therefore, I am extremely grateful to my noble friend on the Front Bench for accepting in principle what we were trying to achieve. That is another example of his listening carefully to what was said and being ready to try to accommodate us whenever he can. I am extremely grateful to my noble friend.
On Question, amendment agreed to.
Lord Inglewood Lord Inglewood moved Amendment No. 31:
Page 68, line 13, at end insert—
("( ) It shall be the duty of each broadcasting or regulatory body, when drawing up or revising any code relating to principles and practice in connection with programmes, or in connection with the obtaining of material to be included in programmes, to reflect the general effect of so much of the code referred to in subsection (1) (as for the time being in force) as is relevant to the programmes in question.").
On Question, amendment agreed to.
Clause 83 [Complaints of unfair treatment etc.]:
Baroness Dean of Thornton-le-Fylde Baroness Dean of Thornton-le-Fylde moved Amendment No. 32:
Page 71, leave out lines 2 to 7.
The noble Baroness said: My Lords, in moving this amendment, I shall speak also to Amendments Nos. 34 and 35, all of which deal with the issue of direct interest. It is not a new subject. It was discussed in some depth in Committee. Indeed, at the invitation of the Minister we withdrew an amendment because the Minister suggested that both the Government and I should reconsider the matter.
He suggested to me also that perhaps a lawyer should look at the amendments because I drafted the amendments for Committee stage and, of course, I am not a lawyer. We have done that, and the amendments before the House this evening have been drafted by a lawyer. However, I gather that the department may have a different view about their legal status and, indeed, the breadth of the amendments.
From some points of view, although certainly not from mine, direct interest is a potentially controversial area. Therefore, it may help the House if I say what the amendments are not about before I go on to describe what they are intended to achieve.
The amendments are not about the whole area of impartiality or incorporating that aspect into the Bill. That has been discussed previously. If that were the intention, neither the Broadcasting Standards Commission nor any other public commission would have the resources to deal with issues about which any member of the public or group, whether or not incorporated, could make a complaint. Nor are the amendments about party political broadcasts and impartiality in that respect. Indeed, that is covered by Clause 107 of the 1990 Act.
So what are the amendments about? They aim to deal with the situation in which a programme is unfair. It may not be unfair to one individual but, rather, unfair in relation to a group of people or perhaps in relation to a very narrow subject area.
Both the 1990 Act and this Bill leave open to judicial review the question of redress. When I was a member of the Broadcasting Complaints Commission—and I declare an interest in that I was a member of that commission until about 15 months ago—complaints were often received in which we felt that there was a sufficient direct interest. That was then challenged by the broadcasters who indicated that they would take the matter to judicial review. Sometimes they did and sometimes they did not carry out that threat. Of course, although individuals may have such a legal right, they do not have that right in practice because of the cost involved. When the commission is taken to judicial review, the cost is on the public purse.
These amendments intend to avoid that situation. I approach the amendments from the point of view that I assume that when the Secretary of State appoints members to the Broadcasting Standards Commission the individuals appointed will be responsible; they will consider all the aspects of the case before accepting it and accept accountability and responsibility for that. Therefore, the Secretary of State should be prepared to give credit to and trust to the commission.
In the past 18 months, there have been two judicial reviews in relation to the issue of direct interest. One case was in relation to a village called Elmton. In that case, the judge accepted that there was a direct interest as a broad concept. In that case the parish council felt that it had a defined interest in a programme which alleged that that small Derbyshire village harboured racists. Therefore, as a consequence, the complaint was covered by the provisions of the 1990 Act.
In that same period of 18 months, a complaint was made in relation to the National Council for One Parent Families. That was referred to in Committee and the Minister has written to me about that. In that case, the judge cast doubt on the Elmton judgment but he did not give the reasons behind those doubts or how he had reached his conclusions. Did the National Council for One Parent Families fail the direct interest test because it was a national body representing hundreds and
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perhaps hundreds of thousands of unidentifiable people—lone parents in that case—or did the judgment in that case mean that no representative body may complain unless it can point to named individuals? Does the size of the organisation matter? Is the membership of the organisation crucial in judging direct interest? Should a body which represents members of our community who, by the very nature of their disability—for example, people with mental disabilities—are unable to become members or indeed to complain, be prevented from representing that particular group in relation to direct interest?
I mentioned the case of the National Council for One Parent Families, and that is a good example of the direct interest issue. In that programme, a young woman by the name of Michelle Ellis was treated unfairly. The complaint was dealt with and the commission found unfairness. But under that very narrow definition of direct interest, the Broadcasting Complaints Commission could not deal with the programme as a whole. Indeed, there were sections within that programme which were judged to be unfair in their treatment of the issue but they did not relate directly to Michelle Ellis who made the complaint.
I suggest to the House that the amendments before us this evening relate to the raison d'être of the Broadcasting Complaints Commission. For example, what would happen in relation to a programme which unfairly treated people who are blind? Could the RNIB make a complaint? Could SANE make a complaint on behalf of people with mental disabilities? Could trade unions make a complaint on behalf of their members?
If the Broadcasting Standards Commission is not given jurisdiction in such cases as having sufficient direct interest, I believe that many will go without redress. Without the new body there is no redress except through the courts. We are dealing with groups of people who do not have the resources—either financially or otherwise—to take such issues through the courts. The amendment would not open the floodgates as has been suggested by some people. Left as it is, judicial review is something which in my view will happen increasingly as the new commission tries to carry out its responsibility to viewers and listeners. I beg to move.
Lord Inglewood: My Lords, I am most grateful to the noble Baroness for having explained to me her thinking behind the proposed amendments, and for letting me see an early version in draft form. I understand that she takes as her starting point in the issue the case of the "Panorama" programme "Babies on Benefit" where, noble Lords will recall, the court found that the Broadcasting Complaints Commission was acting beyond its remit in entertaining a complaint from the National Council for One Parent Families. I shall take the amendment in the sense described so helpfully by the noble Baroness.
The issue in that case was that the complaint in question was brought to the BCC by the organisation, not on behalf of a named participant in the programme but on behalf of the interests of single mothers. In establishing the BCC, the Government's intention was

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that it should defend the personal rights of those appearing in television programmes. The same role is intended for the new commission. It was not the Government's intention that either commission should be used as a forum for interest groups to air their grievances about the treatment or representation of groups of individuals who might be indirectly affected by a programme.
The Government are particularly concerned that the commission's role, in providing an opportunity for those who feel that they have been treated unfairly by a broadcaster, or had their privacy infringed in some way, should not he diluted. There is no reason why an interest group, or a representative of one, may not be authorised by an individual to make a complaint on his or her behalf. Both the 1990 Act and the Bill allow for that to happen. If, in the case that I mentioned earlier, the interest group had been authorised by an individual featured in the programme to make a complaint of unfair treatment, then the BCC could quite legitimately have entertained the complaint.
I think that in that context it is important to be clear that there is nothing to prevent a complaint of the kind that the noble Baroness is concerned about being made to the regulator; that is to say, the Governors of the BBC, the ITC, the Radio Authority in the case of a radio programme, or the Welsh Authority. That seems to us to be the right way to deal with the type of matter under discussion. It is for those reasons that the Government feel that it is both unnecessary and unhelpful to extend the commission's remit in the way proposed. Therefore, we resist the amendments.
Baroness Dean of Thornton-le-Fylde: My Lords, I thank the Minister for his response. I do not welcome it, but at least it makes the Government's position clear. After considering both the meeting that I had with the Minister and the exchange of correspondence that has taken place between us, I regret to say that there still seems to be a block between us on the matter. It may be that a programme is unfair, but it may not be unfair directly to one individual featured in it. That is where the kernel of the matter lies. I expect that the devil is in the detail in the sense that the Minister is obviously concerned about having a remit which is open-ended. That is not the intention of the amendment.
Normally when we are told that complaints can be made to the BBC or, indeed, to the regulator, one would welcome such information. However, I have not yet built up the confidence in either of those two areas that I believe the public have as regards the old Broadcasting Complaints Commission and the Broadcasting Standards Council, both of which will be replaced by the new body. The Minister's response does not meet the points that we have made. I hope that the issue will not be dropped; indeed, I believe that it will be raised time and time again. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
7.15 p.m.
Clause 87 [Consideration of fairness complaints]:
Baroness Dean of Thornton-le-Fylde Baroness Dean of Thornton-le-Fylde moved Amendment No. 33:
Page 72, line 42, at end insert—
("(f) to provide the BSC in respect of unfairness complaints with full unedited visual or sound recordings and transcripts of the making of the programme which is the subject of the complaint so far as the relevant person has in his possession a visual or sound recording of it,").
The noble Baroness said: My Lords, the above amendment deals with an issue that was tabled on the Marshalled List in Committee to which the Minister gave a most helpful response and to which we now return. I have to say that the Minister has also written to me on the matter and indicated that the broadcasting companies have been approached by his department. However, as of last Friday, I believe they had not all responded. I am not in a position to say whether that indicates their interest in the matter, in that they think that if they do not answer the matter will, perhaps, go by the wayside.
However, I am in a position to judge the fact that time and time again one would have complaints about a programme from an individual—and there is no division between us in that area. The complaint would be accepted as legitimate and, in the process of dealing with it, questions would be put at the oral hearing to the complainant, who would say, "Yes, I know it says that in the programme but, if you look at the whole interview; you will find that just before that part that was edited and shown I said this or that and omitting it completely put out of context what I said".
On many occasions the broadcasters would hand over the unedited tapes—the rushes, as I believe they are called—and that would help considerably. Sometimes it would help the commission find in favour of a broadcaster and sometimes in favour of a complainant. But by no means are they available by right. For example, if one had a broadcast from an independent producer, as sometimes would be the case, he might say, "Sorry, we've destroyed those tapes". One would then be left with the programme and, therefore, unable in some instances to reach a really fair adjudication either as regards the broadcaster or, indeed, the individual complainant.
I shall be most interested to hear the Minister's response to the amendment and to know whether he has heard from the broadcasters. Their views would certainly be most welcome. I should point out in conclusion that the amendment was not intended to develop a situation where we would have a warehouse south of the river housing hundreds and hundreds of tapes indefinitely simply to meet that provision in the Bill. That was not the intention. Indeed, it would not be necessary. If one looks at the position as regards radio, the stations are required to keep all tapes for three months after transmission of the programme.

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A provision along those lines would be most welcome, especially as there is a time limit on the ability of individuals or organisations to make complaints under the Bill. I beg to move.
Lord Inglewood: My Lords, the noble Baroness has again been most helpful in her introduction of the amendment. As she said, and as noble Lords will recall, the noble Baroness previously tabled the amendment, which would require broadcasters to provide the BSC with transcripts and all available unedited material used in the making of a programme against which a fairness complaint had been made. At that time I said that the Government would resist the amendment. However, I subsequently met the noble Baroness and, having heard her arguments, agreed that we would consider the matter further.
The noble Baroness will know that the Government are not unsympathetic to her desire to ensure that broadcasters co-operate with the BSC in providing sufficient information to enable the commission to reach a properly informed adjudication. However, after careful consideration of her proposals, in consultation with broadcasting and regulatory bodies, a number of practical difficulties have presented themselves.
One problem lies with the lack of a corresponding requirement upon broadcasters to retain the additional material in question. Clearly—and the noble Baroness has, I believe, acknowledged this point—it would he quite impractical and unreasonable to require broadcasters to find the additional resources and space to store such material for all programmes. As the noble Baroness pointed out, the unedited material used in making a programme may be several times the quantity of that used in the final transmission. However, in the absence of such a requirement, there is nothing to prevent an unscrupulous broadcaster from simply deliberately destroying, before a request has been received, any material which he does not wish to hand over were such a request to be made.
Additionally, there could also be quite legitimate reasons why a broadcaster might be unwilling to hand over such material; for example, it might infringe the privacy of other participants in the programme or reveal a confidential journalistic source. We wish to avoid giving the BSC powers which would go beyond those available to the courts to demand material without hearing argument and without a public interest exemption in situations where the courts would need to make an order under the Police and Criminal Evidence Act.
These are important points which we shall have to take into account. However, we remain sympathetic to the thinking behind the amendment of the noble Baroness. With your Lordships' leave, I should like the opportunity to consult more widely before the Government's more detailed response is made to another place.
Baroness Dean of Thornton-le-Fylde: My Lords, that was a helpful response, particularly as regards the latter points the Minister made. In our experience of the Bill, when a measure has been promised it has been
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forthcoming. We respect the integrity of the Minister as regards his proposal. I shall await with interest the Bill's passage in another place to see what emerges. I thank the Minister for his response. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 101 [Interpretation of Part V]:
[Amendments Nos. 34 and 35 not moved.]
Baroness Trumpington: My Lords, I beg to move that further proceedings on the Third Reading of the Bill be now adjourned. In moving the Motion I suggest that we do not return to this business until twenty minutes past eight o'clock.
Moved accordingly, and, on Question, Motion agreed to.

Prevention of Terrorism (Temporary Provisions) Act 1989 (Continuance) Order 1996
7.21 p.m.
The Minister of State, Home Office (Baroness Blatch)The Minister of State, Home Office (Baroness Blatch) rose to move, That the draft order laid before the House on 22nd February be approved [11th Report from the Joint Committee].
The noble Baroness said: My Lords, I shall speak also to the second Motion on the Order Paper. As in the debate in another place, there are two elements to the debate on the prevention of terrorism powers. Two orders are to be considered by this House. The first relates to the renewal of the Prevention of Terrorism Act for a further 12 months. The second relates to some amendments we propose to be made to Schedule 2 to the Act. These will bring the procedures under which exclusion orders are made into line with European Community law following the judgment given in the Gallagher case. The debate is to be followed by separate votes on each of the orders. I shall deal with each of the orders in turn.
First, I shall deal with the renewal of the PTA. I should like to begin by thanking Mr. John Rowe QC for his very interesting and thorough report on the operation of the Prevention of Terrorism Act in 1995. His clear recommendation is that the Act should be renewed, and for the full 12 months possible under the Act. The Government have accepted his recommendation but before I explain why I should like to say a little about the background to tonight's debate.
The background is very different from last year's, and indeed very different from that which I thought it would be only a few weeks ago. We argued last year for the continuation of these powers against the backdrop of a Provisional IRA ceasefire and the subsequent cessation of violence by loyalist paramilitary groups. While recounting the very real threats which still existed and noting the activities of the first part of 1994, I was able to point to the hope felt by many in Northern Ireland and Great Britain that the threat from terrorism would diminish in the longer term. At that time, and for the

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first time for many years, the people of Northern Ireland were beginning to experience the fruits of peace. They could go about their daily business without fear of violence from either republicans or loyalist paramilitaries. For the first time, too, in many years, the imminent threat of Provisional IRA violence in Great Britain had receded.
The hope was that the cessation in the violence would become a lasting peace. As your Lordships know, the Government have done all in their power to bring that about. In the months which followed the paramilitaries' respective ceasefires, we reduced the more visible and inconvenient aspects of security. In Northern Ireland we took soldiers off the streets, and border crossing points were reopened. The number of house searches carried out in 1995 under the Northern Ireland (Emergency Provisions) Act 1991 were reduced by 75 per cent. and the number of arrests under Section 14 of the Prevention of Terrorism Act fell to a third of what it had been in 1994. There has been new investment in Northern Ireland and new jobs have been created. Tourism was on the increase.
The total number of detentions under the Prevention of Terrorism Act in the United Kingdom for 1995 was 70 per cent. down on 1994's figure. We constantly sought to move the peace process forward. The Government held talks with all the parties including Sinn Fein at ministerial and official level. The terrorist response to these developments was the bomb at South Quay on 9th February. As ever, the Provisional IRA's intent appears to have been to kill or to maim as many people as possible. It is with great sadness that I remind the House that two people were killed in that blast; many others were injured, some seriously. I know that I speak for the whole House when I say that our thoughts are very much with them and with their families.
Since then there have been further incidents, further injuries and another death. Our deepest thanks go to the emergency services whose courage and professionalism have done so much to limit the injury and pain planned by the Provisional IRA. A new ceasefire has not been declared. Instead Mr. Gerry Adams tells us that the Provisional IRA is offering another 25 years of bloodshed.
The powers in the Prevention of Terrorism (Temporary Provisions) Act 1989 enable us to fight terrorism more effectively than would otherwise be the case. That is why we have argued for their renewal each year, and it is why we do so again today. In his report on the operation of the Act in 1995, Mr. Rowe confirms that the paramilitaries have retained their structure and their organisation intact throughout the past 18 months. Murder, assault, intimidation, and coercion; all continue in their name and under their direction. He concludes therefore that the provisions of the Act are still needed and that the Act should therefore be renewed. His report was prepared and submitted to my right honourable friend the Home Secretary before the Provisional IRA's ceasefire came to an end. His conclusions must carry even greater force now that the bombings have begun once more.
The Government agree with Mr. Rowe's conclusion. It would be sheer folly to lower our guard now by allowing any of the provisions in the Act to lapse. The events of the past few weeks surely put the continuing need for the Act beyond question. But the Act's provisions are not used solely to counter Northern Irish terrorism. Some of its powers can be, and indeed are, used to great effect to counter the threat of international terrorism. The most recent examples are the charges on explosive offences—after detention and extension of detention under the Prevention of Terrorism Act—made following the car bombs outside the Israeli embassy and Balfour House in July 1994. In 1995 a series of detentions under the Act of those suspected of involvement in the terrorist campaign in France were a contributory factor in the disruption of that campaign. One of those detained is currently held following an extradition request from France. Mr. Rowe concludes that whatever happens in Northern Ireland there is always likely to be terrorism of an international kind; that the manifestations of this are increasing; and that the need for the Act's provisions to counter them therefore remains.
I should also like to say something about the inquiry which is currently being undertaken by a Member of your Lordships' House, the noble and learned Lord, Lord Lloyd of Berwick. As my right honourable friend the Secretary of State for Northern Ireland announced to the House on 9th January, the noble and learned Lord, Lord Lloyd, had then agreed to lead an inquiry to consider whether specific counter-terrorist legislation would be required once a lasting peace was established in Northern Ireland. His review is under way. It will examine the provisions both of the PTA and of the Northern Ireland emergency provisions legislation in the course of considering what may or may not be needed in future. His terms of reference remain unchanged notwithstanding recent events and the Government will consider his conclusions once the inquiry has been completed. I understand that the noble and learned Lord hopes to report before the autumn.
The Government's first priority must be to protect the public. To do that we need to give the police the powers they need to combat terrorism effectively. The provisions of the PTA are needed to stop the terrorist from taking action and from re-stocking his armoury and to deprive him of funds and a place to hide. In the absence of peace, at a time when the terrorist is ready and willing to strike and slaughter at random, there can be no question but that the Act is needed. The Act must be renewed, and for the full period of 12 months allowed under the Act. I therefore commend the order to the House.
I come now to the second part of this debate. The second order before the House today amends the procedures in the PTA governing the making of exclusion orders.
In putting the case for the renewal of the Act, I have not dealt with the detail of the powers themselves. They have been discussed and debated many times before, both here and outside Parliament. We all know the

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arguments. Except as regards the making of exclusion orders, I shall not detain the House therefore in describing them now.
The power to make exclusion orders may be used only to counter the threat from Northern Irish terrorism; and it has, as Mr. Rowe points out in his report, proved a valuable tool over the years in disrupting terrorist plans.
Particular individuals can be barred from entering Northern Ireland, Great Britain or the United Kingdom where the Secretary of State is satisfied that they would take advantage of their presence in that place to commission, prepare or instigate acts of terrorism in connection with the affairs of Northern Ireland. The use of this power not only hampers the terrorists' ability to travel, but because their identity is known, it also limits their overall usefulness to the terrorist organisation to which they belong. Once their organisation is aware that the activities of an individual have become known to the security forces, their usefulness necessarily diminishes.
Some have argued that keeping people under observation could be more effective than exclusion. But the Government believe that the resource implications of mounting a surveillance operation in every case would be substantial, and in most cases that would not be a realistic proposition.
Some people have suggested that the process of exclusion is arbitrary and unfair. I do not accept this, and Mr. Rowe's report makes it clear that it is not so. Before any order is made, a considered report is sent to the relevant department. Mr. Rowe refers to the further scrutiny of the case for exclusion by officials and by the Secretary of State. This scrutiny is robust. I was pleased to note from his report that Mr. Rowe found that each participant in the process,
"approached the task with fairness",
during the year under review.
Each case is assessed on the basis of the available facts. There are currently 33 orders in force. That is the lowest number ever since the power was introduced.
The reduction in the numbers of orders in force since 1994 reflects the assessment of the level of threat presented by certain individuals at the relevant time. I have to tell your Lordships that the case to exclude each of the 33 is a strong one and that it remains.
It is possible that further orders will be made, particularly now that the Provisional IRA's ceasefire has broken down. But each case will, as now, be considered very carefully on its merits.
The need for the exclusion power is proven. It is effective. It is an essential weapon in the counter terrorist armoury. Now is not the time to relinquish it.
But we propose to make some changes to the procedures governing the making of exclusion orders in order to bring them into line with European Community law following the European Court of Justice's ruling in the Gallagher case; and these are set out in the second order which we are debating today. The regulations are to be made under Section 2 of the European Communities Act 1972 which makes special provision to facilitate the amending of legislation to bring UK law into line with European Community law.
For the avoidance of doubt, perhaps I may say that the Court found no fault with the substance of the power to exclude. Its judgment simply requires the Secretary of State to obtain independent advice in every case where he is considering whether to make an exclusion order before the decision is taken.
The new procedures set out in the regulations require the Secretary of State to serve written notice on any person in the United Kingdom against whom he is considering making an exclusion order; to refer the matter for advice to one or more independent persons nominated by him to give him advice on such matters; and to take the advice he subsequently receives into account when making his decision. A person who has been served with such a notice may make written representations setting out his objections and can ask to be interviewed by the independent adviser before the latter reports to the Secretary of State.
These new procedures replace very similar procedures in Schedule 2 to the Act but which currently apply only after an exclusion order has been made.
Historically, those detained under the Act have often been at an advanced stage of planning a terrorist operation. The decision to arrest them will have been taken either because surveillance has been compromised or because there is uncertainty as to the exact timing of a terrorist attack. This can sometimes mean that the individual is detained before sufficient evidence is available to secure a criminal conviction. In such cases it is often the police who apply for an exclusion order.
These people can be dangerous, committed terrorists involved in an operation at an advanced stage of planning. It would not be right to release them back into the community pending the procurement and consideration of independent advice.
That is why there is currently a power to detain individuals during that time; and it is why the new regulations before us contain a similar power of detention. Under the new procedures it will he possible, if the individual concerned is within the part of the United Kingdom from which consideration is being given to excluding him, to detain him for the period between the serving of the notice and the final decision being taken.
This power is not always used now. It may not always be used in the future. Sometimes the individual is permitted to leave the jurisdiction pending consideration of the case against him. This will still be possible in future.
All the necessary procedures will be carried out as swiftly as possible. But, as your Lordships will have seen from the regulations, the time it takes for any individual to be interviewed and so forth is partly dictated by them. The individual concerned will have seven days from the date of the notice, if they arc inside the jurisdiction from which consideration is being given to excluding them, in which to make their representations and request an interview.
The events of the past five weeks fill us all with dismay and sorrow. Peace seemed for a while as close as it has ever been and then the terrorists chose to return to violence and murder. The bombs in London serve the

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interest of no one and no party. They have shown us, however, that we cannot afford to drop our guard. We do not propose to do so. We continue to need the emergency powers contained in the Act. The orders before us will give us those powers, and I commend them to the House. I beg to move.
Moved, That the draft order laid before the House on 22nd February be approved [11th Report from the Joint Committee].—(Baroness Blatch.)
7.37 p.m.
Lord McIntosh of Haringey: My Lords, the Minister spoke, entirely properly, for, I think, 15 minutes in total. I begin by saying that I agree with 13 minutes of what she said—in other words, minutes one to 10 and 13 to 15. Therefore, it will be clear that on a subject on which one must be entirely serious we are largely in agreement with the Government.
We are, and always have been, in total agreement with the Government, and I believe with all the people of this country, and with virtually all the people of Northern Ireland, on the nature of the scourge of terrorism in Northern Ireland. We have always totally condemned terrorism by paramilitaries of whatever persuasion, and we do so again. We do so with renewed fervour because of the deplorable resumption of hostilities by the IRA in recent weeks. We share with the Government and with all parties in your Lordships' House the sincere hope that it will be possible by the continuation of the peace process to persuade the IRA to return to its ceasefire and to enable positive negotiations to take place in the period following 10th June of this year. Our position on all these matters has never changed; and we have pursued our bipartisan support of the peace process ever since it began, as I think will he recognised by Ministers and indeed by all noble Lords.
We have always accepted that there must be some form of anti-terrorist legislation. In 12 of the years since the legislation was first introduced by a Labour Government my colleagues in another place have felt it necessary to vote for the legislation, although they did not do so in other years. That fact is evidence of our recognition of the need for anti-terrorist legislation while the situation in Northern Ireland continues. Our votes against that legislation in certain years have been specific, by design. I shall deal with each of the issues in turn. We have been concerned with the problem of exclusion orders and with who is responsible for the extension of detention and whether that should be the Secretary of State or whether there should be a judicial element. Above all, we have been concerned with the need for a general and comprehensive review of counter-terrorism legislation.
I deal first with the issue of exclusion orders. The figures which the Minister gave us tonight are extremely welcome. We are glad to learn that the number of exclusion orders in force has decreased from a much larger figure in recent years down to 33. The number of exclusion orders is important and we are glad to note that the figure has been reduced. Nevertheless, exclusion
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orders are internal exile, which has not been part of our law since the time of Henry VIII. We must surely continue to look forward to a time when no citizens of the United Kingdom are excluded from one part of the United Kingdom. By using the phrase "United Kingdom", I do not in any way prejudge the result of the peace process. I am saying that we are citizens of the United Kingdom and it must surely be our intention to ensure that we all have freedom to move everywhere within our own country.
Having read Mr. Rowe's report carefully, I still do not know whether the exclusion orders have an effect. It is true that a majority of the police in all parts of the United Kingdom take the view that the orders continue to be necessary. But it is to be noted that a significant minority expressed the view to Mr. Rowe that the exclusion orders were not performing any useful purpose. While it is not a basis on which we or my honourable friends in another place would vote against the order, nevertheless we look for a statement from the Government that they share our view that exclusion orders are peculiarly undesirable. All counter-terrorism legislation is undesirable, but exclusion orders are especially so. They ought to be brought to an end either by administrative action—in other words the action of the police—or by an amendment to the Act as soon as possible.
The second issue is extended detention. Again, we have reluctantly come to accept that extended detention is necessary, although I understand that in recent years the number of detentions under the Act beyond 48 hours has fallen. It is quite small, although the power exists for extended detention for seven days. All that is welcome.
Our specific complaint about extended detention is the involvement of the Home Secretary rather than judicial involvement. We hope that, in legislation which contains many necessary elements, the Government will continue to scrutinise that element with care and will bring it to an end as soon as possible. In other words, where there is a derogation from the provisions of the Police and Criminal Evidence Act that should be done within the judicial process, without political involvement. I believe that that principle ought to commend itself to many noble Lords. We hope that it will commend itself to the Government and that we shall not be in the position of being forced to mention it in future years. Ideally, we would not wish to be faced with these regulations under the temporary provisions Act 1974 in future years.
The third issue is the general and comprehensive review. Over the years at intervals there have been reviews of the operation of the anti-terrorist legislation by the noble Earl, Lord Jellicoe, Lord Gardiner, Lord Shackleton and, recently, the noble Viscount, Lord Colville, in 1987. We welcome the appointment of the noble and learned Lord, Lord Lloyd of Berwick, to undertake a review which was announced in January of this year. I appreciate that the terms of reference of his review are not strictly a review of the prevention of terrorism Act. As I understand it, his responsibility is to consider the future need for specific counter-terrorism legislation in the United Kingdom if the cessation of violence connected with the affairs of Northern Ireland

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leads to a lasting peace. It has not yet, but we welcome the fact that the noble and learned Lord has been encouraged and is continuing his review, even though the ceasefire has come to an end and there has been a resumption of violence.
I do not believe that one ought to make a distinction between the need for counter-terrorism legislation in Northern Ireland in the present situation and the possible longer-term need for counter-terrorism legislation in respect of other enemies. The considerations are the same, whether it is the IRA or the Groupe Islamique Armée of Algeria, or whoever else it may be. The noble and learned Lord's inquiry specifically considers terrorism in general and seeks general principles about how we, as a free nation, seek to counter terrorism and to learn what departures from our normal procedures may be necessary if we are to succeed in doing so.
That most important concern which we had about the prevention of terrorism legislation has, I believe, been properly answered by the appointment of the noble and learned Lord. We welcome it. On that basis my honourable and right honourable friends in another place felt that it was unnecessary to continue to vote against the continuance order when the matter came before the House of Commons last Thursday. However, as I have made clear, they felt that some of the provisions are still defective. Therefore, it was not possible to give a blanket approval to the continuation order.
I turn now to the exclusion orders regulations. Again, we do not oppose them, but they are Henry VIII legislation. We are, by order, amending Schedule 2 to the current 1989 Act in considerable detail. I accept that the need for amendment which arises in part from the Gallagher case before the European Court of Justice has been demonstrated. We certainly do not oppose this exclusion order, and we shall not be voting against it. But I do so only having drawn attention to the strictly constitutional impropriety of amending legislation in this way.
The involvement of the European Court of Justice, as has been made clear, was relatively peripheral to the fundamental thrust of the exclusion orders. It was concerned with the opportunity for an independent review rather than with the principle of exclusion orders themselves. On that basis, we do not oppose the second order that will be put before the House.
In conclusion, we find ourselves in complete harmony with the Government on almost all the issues relating to terrorism that confront our country. We share with the Government a desire not to have any more derogations from the rule of law than are absolutely necessary to maintain our position in seeking to defeat terrorism. We do not under-estimate the power of terrorists who have no fear of public opinion and have nothing but their own fanaticism to drive them forward. We see that in Northern Ireland, but we see it much more strongly and horribly with the suicide bombs in Israel. We do not think that a prevention of terrorism Act will prevent terrorism. But we think it is necessary to do what we can to minimise the effects of terrorism, and to that extent, subject to the remarks I have already made, we are not opposing these orders.
7.51 p.m.
Lord Rodgers of Quarry Bank: My Lords, I apologise to the noble Baroness. She was so quick off the mark that I missed her opening two minutes. We on these Benches share the very deepest regret, felt in this House and elsewhere, about the resumption of terrorism by the IRA. We also greatly welcome the Government's determination to pursue the peace process when it would have been so easy to find cause to abandon it. What the Government have done in this respect should have the support of everyone.
I shall not pursue some of the contradictions in the Labour Party's approach to the order. They are such that even the noble Lord, Lord McIntosh became tongue-tied trying to explain them. I invite noble Lords who have any doubt about the matter to read the debate in the other place on 11th March to get the full flavour of the divisions in the party. What I particularly regret are not differences of opinion, which are natural enough and are found in any party, but the failure of the Opposition to support positively what we believe to be a necessary measure. The noble Lord, Lord McIntosh, made the best of a bad fist in that respect. Because I have a regard for him, I like to believe that if there were to be a vote on the order in this House he would have found it extremely difficult not to support it.
The views that the noble Lord expressed about the original legislation and what has happened since will be widely shared. I do not think any noble Lord can welcome the order, because it might imply welcoming the necessity of it. But we accept it because it is an instrument, however limited, in the fight against terrorism.
I recommend that noble Lords wishing to explore the matter should look back to the debate in this House in November 1974 and study particularly the remarks of my noble friend Lord Harris of Greenwich in introducing the Bill, as it then was, and what he said about the fundamental need for such legislation in the circumstances of that time. I also advise noble Lords to read the speech of my noble friend Lord Wigoder. He had some very wise words to say about how we had to be very careful that the legislation did not become a permanent feature of the landscape in this country. I should be quite happy to rest, if that were sufficient, on what they said all of 22 years ago.
There is no question that there is a derogation from civil liberties in the order. I agree—at least, I do not dissent from, if that is the best way of putting it—the remarks of the noble Lord, Lord McIntosh, about detention for seven days and about exclusion orders. I regret those powers. We should not take them for granted, and we should not allow them to become a permanent aspect of legislation in this country.
Of course, it is true that the expression "prevention of terrorism" is a misnomer. The legislation of 1974 and the subsequent orders, including this one, neither prevent terrorism nor ensure the capture of those who practise it. It is a blunt instrument. But its role, although limited, is not one we can abandon. I accept that innocent people are sometimes victims of it. Sometimes, also, it may impede good relations between the police

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and the community. That is the inescapable price that in today's circumstances we must pay, faced with the threat that terrorism represents to a free and democratic society, sustained both by the rule of law and by our belief in the liberties that flow from it.
A year ago, in the debate in this House on 16th March, I said that I could not see why a full review should not be undertaken of existing legislation and that that could be done without prejudice to the order we were then discussing. I said that we on these Benches believed that such a review should be undertaken without delay. I made those remarks a year ago, and the view had been expressed before.
The noble Baroness, in her reply to that debate, while accepting that the time might come for such a review, said that it would be premature. It remained "premature" for all of 10 months. But that is no reason why we should not welcome the announcement made in January this year of an inquiry—the review to be undertaken by the noble and learned Lord, Lord Lloyd of Berwick.
There is, however, one point on which I should like to be clear. It may be the point on which the noble Lord, Lord McIntosh, briefly dwelt. The terms of reference of the inquiry are to,
"consider the future need for specific counter terrorism legislation in the United Kingdom, if the cessation of violence connected with the affairs of Northern Ireland leads to a lasting peace".—[Official Report, Commons, 9/1/96; col. 33.]
That could he read as meaning that as, very sadly, the terrorism has resumed and we do not know when a further cessation may take place, in effect, the inquiry of the noble and learned Lord, Lord Lloyd, is on hold meanwhile. I am sure that that is not the intention of Ministers, and indeed I understand that the noble and learned Lord is taking evidence at the present time. But perhaps the Minister will confirm my assumption that, whatever the terms of reference, it will be within the power of the noble and learned Lord not only to make such recommendations as will be appropriate once the cessation of terrorism connected with the affairs of Northern Ireland has led to a lasting peace, but, if that cessation has not taken place, to make whatever recommendations he feels are proper in respect of the legislation that has resulted in this order. As I say, we accept the need for the order with reluctance; but we support the necessity of bringing it forward.
7.58 p.m.
Lord McConnell: My Lords, I support the renewal of the temporary provisions Act, which I consider to be most necessary. Rather than put the argument in my own words, which people may think indicate that I take a particular view, I refer to paragraph 13 of the report by Mr. J. J. Rowe, QC, which has already been referred to by the Minister. It states:
"The proscribed organisations still maintain their structure and organisation, and murders and assaults are carried out in their name and under their direction. Between 8th December 1995 and 2nd January 1996, 5 murders were carried out by DAAD, which is widely believed to be associated with the IRA. The influence of the proscribed organisations is as strong as ever, and they retain the capacity, which they exercise, to intimidate and coerce individuals and businesses. I have seen examples. Jurors and witnesses receive
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threats, or fear to receive them; traders pay 'protection money'. Collections are made for contributions; and funds are diverted to the organisations by fraud and racketeering. Robberies are carried out to raise money. Explosive devices have been found: a new mortar device has been developed for use … [in] Northern Ireland. Considerable amounts of firearms and explosives are still in the hands of the proscribed organisations and ready for use. Training goes on, and there is some recruiting — The summary is this: there remains a capability to carry out attacks with explosives and firearms; the risk of immediate large scale violence has gone down, but the threat of it is still there, and the structure and influence of organisations remain. In these circumstances, there is a need for the PTA so far as concerns terrorism connected with the affairs of Northern Ireland".
That was written in respect of the year 1995, during the so-called ceasefire. How much more is it applicable today in view of the recent atrocities that have been committed.
Another point that was made by the noble Lord, Lord McIntosh of Haringey, concerned the possibility of a judicial element in exclusion orders. Again, I take an impartial source and quote Mr. Rowe:
"it must be remembered that an application for an exclusion order usually relies upon and recites information which does not amount to admissible evidence; it is intelligence which is secret, and cannot be disclosed in court, because disclosure would compromise the source of it, and endanger someone. An application to a judge would rely on material just like this. Thus the person against whom the exclusion order was sought could not be told what the information was, and so could not cross-examine or challenge it, and could not raise an answer to it … In these circumstances the judge would not be hearing both sides, and the rules of natural justice would simply be absent. The judge could not give reasons for a decision, there would be no appeal, and there would be no possible guidelines from a superior court. He would be acting as a judge in name only".
The other aspect that I should like to mention is the funding of terrorism. That is very important. People talk about Godfathers and the Mafia-like characteristics of some of the terrorist organisations. Again, that was dealt with by Mr. Rowe in paragraph 41 of his report, in which he said:
"There are two other sections which have been effective on the financial side of terrorist activity; section 12 as to voluntary disclosure of a suspicion that money or property is derived from terrorist funds, and section 18A which penalises failure to disclose knowledge or suspicion of financial assistance … all these powers have been used to support anti-terrorist investigation; I was given important examples of the detection and analysis of financial transactions, and this applied both to international terrorism and terrorism connected with Northern Ireland".
With that mention of international terrorism, we must remember that most of this Act—not in its entirety but most of it—applies to the whole of the United Kingdom and not just to Northern Ireland. It is essential in this country that we have proper defences against people who come here from another country and seek to plot against the government of that country or some faction within that country and do it within the shelter of the United Kingdom. It is essential that we are able to defend ourselves against such activities.
Finally, I join in the welcome that has been given to the review that is to he undertaken by the noble and learned Lord, Lord Lloyd of Berwick. We have every confidence in his ability and impartiality and we look forward to reading his report when it is published.
8.6 p.m.
Lord Mason of Barnsley: My Lords, I shall be brief. Ever since I introduced, as Secretary of State for Northern Ireland, the Prevention of Terrorism Act in another place in 1976, I have consistently supported the continuation of that Act and the exclusion orders which back that legislation. Tonight, I do so once again.
The ceasefire has ended. We are now back in a terrorist-war situation. There is all the more reason therefore to support the Government in their fight against terrorism, both terrorist forces within the United Kingdom and those who come from beyond our shores.
We have just endured an uneasy peace, welcome though it was particularly for those in Northern Ireland. I wish that it could have continued. But I believe that it was a sham. As I have reminded the House on previous occasions, the Provos—the Provisional IRA—were never at rest. When Gerry Adams was heckled in West Belfast, he said, "They haven't gone away, you know". Well, we know that now.
During the course of the ceasefire, Irish Americans, many of them gullible and naÏve, with no real knowledge of the Northern Ireland situation, raised nearly £½ million. Many of them thought that it was going to Provisional Sinn Fein or probably the families of terrorist prisoners. But in reality it has been going to the Provisional IRA. It has been paying for recruiting and training in the Republic and used as payment for the movement of arms or bomb-making equipment, renting safe houses, supporting activities such as dummy bomb runs in London and surveillance of persons. Therefore, there has been no shortage of moneys to finance those operations. Indeed, there is no more classic example than that of the lorry used in the Canary Wharf bombing which was prepared and moved from Northern Ireland to Great Britain; weeks of work were involved and it took place during the so-called ceasefire. No doubt that job was made easier because of the relaxed state of the security forces.
Having reverted to a terrorist-war condition, we must use to the full the legal armoury of the Prevention of Terrorism Act and the exclusion orders.
During the ceasefire, the Provos have taken full advantage of all those relaxations, many of them when visiting the mainland from both the north and south, visiting friends or attending football matches and so on, but diverting en route to leave a message in a covert drop, awaken sleepers, contact an active service unit, move arms and establish safe houses. We know in retrospect that for the past 18 months that has been going on. So checks at our ports and airports must be increased and exclusion orders are an important element in those operations.
I know there is concern about the extension time that a suspect can be held under the orders and that a Minister or the Secretary of State can determine the length of detention. I have no qualms about that, having done it and treated it with the seriousness that it deserves. I recognise its value. Tracing, tracking and detaining suspects, including exclusions, may he harassment—hut often it disrupts the plans and operations on the mainland and deters suspects from
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crossing from Ireland. As Mr. Rowe mentioned in his report, the powers to make exclusion orders deter terrorist acts and deprive the terrorist groups to which these people belong of some of their experienced operators.
The latest figures show that 477 people were detained under the Prevention of Terrorism Act 1995: 19 were held in connection with international terrorism—that is some proof of its value—and the rest were in connection with Northern Ireland terrorism. Subsequently, 121 were charged with offences under the Act and these orders.
The terrorists are still active; they are not at rest. There has been no recognition by them of the ceasefire; and without these orders more terrorists would be active. I know that some people complain and object to these orders. But libertarians must understand that we have to forfeit a little liberty to save and secure a lot of freedom. That is the crux of anti-terrorist legislation and that is why I back these orders tonight.
8.11 p.m.
Lord Monkswell: My Lords, the House will appreciate that, in rising to speak tonight, I may bring a slightly different perspective to this debate. First, I thank the Minister for introducing and explaining the orders. I wish to explain why I am speaking; to go on to look at some of the background; to look at the current situation and then to ask the Minister a number of questions.
Why am I speaking? It will be appreciated that when I first came to this House 11 years ago I attempted to divide the House against the Prevention of Terrorism Act as it was being renewed and I did that for a number of years. I stopped doing it because I received no support in the House for my point of view. I noted also that the legislation was changed a little by the introduction of the 1989 Act.
There are two elements that bring me to my feet tonight. First, in the second of the orders we are effectively introducing a new power of detention without charge and without judicial review. Secondly, given the debate and discussion that surrounded the Labour Party's opposition to these renewal orders, I felt that I had to stand and reaffirm my commitment to the principled position based on what I believe is a pragmatic view of the facts.
Perhaps I can explain a little of the background as I see it. The original Prevention of Terrorism Act was introduced in 1974, 22 years ago. If any Act introduced by Parliament demonstrates the adage that legislation introduced in haste leads to repentance at leisure, this does. I only hope that we can learn from that experience and not be pushed into a knee-jerk response following the horrific tragedy that occurred in Dunblane last week.
Over the past year or so we have experienced a peace process. It is worth considering the background to that. We need to look at the economic circumstances, the predominant one of which is the accession of the Republic of Ireland to the European Union. As a result it became involved in the common agricultural policy, which injected massive economic stimulus into its economy and reduced the gap between the two

1239
economies—that of the Republic and that of Northern Ireland. I can also point to the immense damage done to the City of London by the Bishopsgate bomb and other activities.
We should all pay tribute to John Hume for instigating the peace process. But we need to be aware that the Government placed road blocks in the way of that peace process. The first was the demand for the surrender of arms and the second was elections prior to talks. When we consider the situation in South Africa, we see that the ANC was not required to surrender its arms before a rapprochement between its members and the ruling white elite. When one looks at the situation in Israel and Palestine, one sees that there was no requirement for elections prior to negotiations.
With regard to the current situation, it is unfortunate that the peace process has broken down and I am sure that we all hope that some way is found to ensure that it is resurrected and taken forward. We are faced with a continuation of seven-day detentions without charge or legal review and exclusion orders that have already been referred to this evening by other noble Lords. I am not sure of the current situation—this is almost a rhetorical question for the Minister—but the last time I researched the subject the only other part of the world that operated a system of internal exile was the Soviet Union, when it existed. Even in the Soviet Union there was some form of judicial review of the process of internal exile.
Lord Orr-Ewing: My Lords, perhaps the noble Lord will allow me to intervene. Is he going to try to justify the 2,500 civilians—many of whom were women and children—who have died as a result of terrorism? It is not a road block; it is a dastardly effort to reduce any peace chance in Northern and southern Ireland.
Lord Monkswell: My Lords, one of the matters we must look at is what is the practical reality of our actions. We are talking about the renewal of the draconian powers—that is how they were described when they were first introducedߞcalled the Prevention of Terrorism Act. We have had 22 years, less a little bit, of terrorism. The new situation with which we are presently faced, which is part of the reason I am speaking tonight, is that, because of the European ruling, the Government have seen fit to amend the Prevention of Terrorism Act in regard to exclusion orders and effectively bring in a new power of detention prior to operating the exclusion orders.
I am sure that there are other ways in which the Government could approach the issue, but they have chosen to introduce this new power of detention. On my immediate reading of it, it would appear that there is no time limit. It is supposed to be carried out "reasonably quickly", but no specific time limit is placed on the powers of detention. That gives rise to a number of questions.
First, will the detainees have the safeguards of the Police and Criminal Evidence Act? Will they be able to consult a solicitor and contact their families? How will the Home Secretary be safeguarded against charges of abuse of unfair executive powers? Finally, who will be
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the person nominated by the Secretary of State to conduct the investigation and the review of those powers of the provisional detention order, if I may describe it like that?
In concluding my remarks, I believe that the Prevention of Terrorism Act effectively discriminates against Irish people and acts as a recruiting sergeant for violent Irish nationalists, and that is the reason why I take a principled stand against it.
Viscount Waverley: My Lords, before the noble Lord sits down, would he accept that this Act would become unnecessary if the IRA would adopt a democratic procedure?
Lord Monkswell: My Lords, as I understand the noble Lord's question, what he is effectively saying is that, if the peace process in Ireland can progress so that all the parties agree and an effective peaceful situation can be arrived at, then, by implication, there would be no need for the Prevention of Terrorism Act. Unfortunately, we have heard a number of people around the House tonight effectively saying that, whatever happens in Northern Ireland, this is going to carry on. I think we do need to have a very serious look at how we deal with this. Yes, there are problems of terrorism, of international terrorism, of people taking violent acts, but I would hope that we would not ride roughshod over the principles of civil liberties that have been established over centuries in this country in the process of dealing with that problem.
Baroness Blatch: My Lords, first, I am grateful to all those noble Lords who have spoken in favour of these orders. May I say to the noble Lord, Lord Rodgers, that I welcome what he said and I understand very well the particular point the noble Lord made when he said that the measure was not so much welcomed as seen as a necessary measure to counter terrorism. I think that is a very appropriate way to describe these measures.
I may also say that we have heard the many voices of the Official Opposition, the Labour Party, tonight. We heard them in another place but we have heard them again tonight. I do want to put it on record that the noble Lord, Lord McConnell, speaks with some very real insight, understanding and experience of that land and knows exactly and appreciates, I believe, the importance of these measures. As for the noble Lord, Lord Mason of Barnsley, we all know in this House of the distinguished service that he gave in very high office in Northern Ireland and of his incredible courage and bravery, and I believe he has been entirely consistent throughout and sees the full force of the need for this legislation.
I have to say that the noble Lord, Lord Monkswell, will have given succour to only one set of people tonight. They are the terrorists and the Provisional IRA. Much of what he said was very much more in their interests than in the interests of people who walk free in our country.
The noble Lord, Lord McIntosh, and the noble Lord, Lord Monkswell, have expressed concern about the exclusion power. They had objections to it on the grounds of civil liberties or as an unacceptable form of

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internal exile. As I have already said, this is a power which has been used sparingly and has been used carefully over the past year. There are only 33 exclusion orders currently in force, and that is less than half the number in existence at the beginning of 1995. The noble Lord, Lord McIntosh, accepted this and recognised it, but he nonetheless believes that they are wrong. However, it would be naïve and irresponsible of the Government to abandon the power completely while the Provisional IRA maintain their weapons and maintain their explosives and, indeed, maintain their will to use them. I wish it were not so, but I am afraid that we have to face hard realities.
The noble Lord, Lord McIntosh, referred to the second order as a Henry VIII order. The amendments made by the second order are not Henry VIII provisions. That is a type of provision that I know and he knows well allows you to do whatever you like. The amendments are made under Section 2(2) of the European Communities Act 1972. That provision entitles us to make regulations to implement our Community obligations, and that is what these regulations do in response to the European Court of Justice's ruling in the Gallagher case.
Lord McIntosh of Haringey: My Lords, if the Minister will allow me, I really do not want to detain the House but of course a Henry VIII order is not one which allows you to do what you like. It is the amending of primary legislation by means of secondary legislation. It is a very specific thing and the reason why I did not object to it was because intrinsically it is right and, although I did not expand on it, also because it is required by the European Communities Act 1972.
Baroness Blatch: My Lords, the noble Lord has done battle with me across this Box on many occasions; he has always referred to them as being open-ended and sometimes the use of a Henry VIII clause can be seen because one has to rely on the Secretary of State to use a power in the appropriate way.
I confess I am not impressed by arguments about civil liberty if we are talking about the civil liberty of a person to travel around the United Kingdom to commit what acts of terrorism he pleases. The Government and, I am sure, the vast majority of the population are far more concerned with the civil liberty to run a newsagents in Docklands without the roof being blown off on top of you or the civil liberty to catch a No. 171 bus without it and its passengers being blown to bits in the Strand. As for the extensions of the detention order under Section 14 of the Act, my right honourable friend the Home Secretary gives his personal authority for any detention beyond 48 hours. In doing so, he looks at the case put forward by the police, including, for example, the need for further inquiries or for searches to be made or, with foreign suspects, for suspicious material to be translated, and he takes into account any intelligence we may have which might justify the inquiries where an extension of detention is necessary for investigative purposes. It is authorised for that purpose.
This is a decision which cannot he subject to a judicial process, some have argued, since the full intelligence picture, which alone enables an informed
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judgment to be made, could not be revealed to the detainee. The noble Lord, Lord Mason, certainly understands this and the noble Lord, Lord McConnell, referred to it specifically. It would not be susceptible to examination or challenge. No reasons could be given for a judicial decision and, as Mr. Rowe wisely pointed out in his review of the operation of the Act in 1995, a judge would be acting as such in name only and, in essence, he would—and I quote the report:
"have every appearance of being an arm of the executive".
I am sure that noble and learned Lords would agree with me that this would be a most unsatisfactory outcome. The idea of introducing a judicial element has in fact been rejected in reviews of the Act by Lord Shackleton in 1978, by my noble friend Lord Jellicoe in 1983 and by the noble Viscount, Lord Colville, in 1987.
Perhaps the most difficult area to address is the funding of terrorist operations in other countries. Whatever legislation is in place, it is extremely difficult to get the evidence to secure a conviction. Money is laundered through various routes and some may indeed be used for humanitarian purposes as a cover and, as soon as one supposedly innocent fund raising activity is exposed, I regret to say that the collecting tins will come out under another guise. To tackle this, we need close and careful international co-operation and, in many cases, it may be best to tackle the fund raiser rather than the fund he establishes, excluding or deporting when my right honourable friend the Home Secretary is satisfied that the activities concerned are effectively funding terrorism elsewhere. It is an area to which the Government will continue to give very close attention and, if there are ways of tightening up our practices which will make a real difference, we will put them into effect speedily.
We all regret the necessity for this Act. It is only on the statute book because of the activities of terrorists. So long as there is terrorism there must be prevention of terrorism. It is a reasonable defence against the very unreasonable acts of terrorists, and I think most people in the country would welcome the renewal of the Act as a way of making life more difficult for the terrorist and helping to prevent further outrages.
In answer to the noble Lord, Lord Monkswell's questions: yes, detainees, as now, are able to seek a solicitor and have an interview with an independent adviser, and the PACE rules, as I understand it, do apply to the exclusion order provision.
The Prevention of Terrorism Act is our principal legislative defence against terrorists of every description. I commend the two orders to your Lordships to make sure it remains so.
Lord Rodgers of Quarry Bank: My Lords, before the noble Baroness sits down, I asked her a specific and important question about the inquiry of the noble and learned Lord, Lord Lloyd of Berwick. I asked whether it was in limbo because the terms of reference refer to cessation of terrorism and to a lasting peace. I thought

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she was going to say—I hope she will say—that it is not in limbo at all but is proceeding. I think we need that on the record.
Baroness Blatch: My Lords, I apologise. I was trying to avoid going back to some bitty points—not unimportant points but I did not want to go on repeating myself. I apologise most profusely for not referring to that point. I am able to say that the noble and learned Lord, Lord Lloyd of Berwick, will indeed take into account as part of the review the possibility of not only a lasting peace, for which we all hope, but also the awful possibility that a ceasefire is not secured and the need for continuing legislation. That will form part of the review.
On Question, Motion agreed to.

Prevention of Terrorism (Exclusion Orders) Regulations 1996
Baroness Blatch: My Lords, I beg to move.
Moved, That the draft regulations laid before the House on 22nd February be approved [11th Report from the Joint Committee].—(Baroness Blatch.)
On Question, Motion agreed to.

Broadcasting Bill [H.L.]
8.31 p.m.
Proceedings after Third Reading resumed on Clause 101.
Lord Thomson of Monifieth Lord Thomson of Monifieth moved Amendment No. 36:
Page 80, line 37, leave out from ("programme") to end of line 38 and insert ("does not include an advertisement but includes a teletext transmission (apart from any advertisement on such a transmission) and, in relation to a service, includes any item included in that service, except an advertisement;").
The noble Lord said: My Lords, your Lordships will notice that the amendment is accompanied by a star. It is in fact the only amendment on the Marshalled List that is accompanied by a star. The star indicates that it was tabled only yesterday. I apologise to the Minister and to the House that there has not been adequate notice but I was given notice of the matter only a few days ago. I thought it worth while to try to get some clarity on the issue the amendment raises. At this stage of our proceedings it should not take long.
The amendment deals with what I regard as an oddity of the 1990 Act. The Act included for the first time in the remit of what was then the newly-established Broadcasting Standards Council in terms of its statutory position advertisements as well as television programmes. The simple issue I am raising is that there are differences between television advertisements and television programmes and that they need to be dealt with in quite different ways.
Television advertisements are tightly regulated quite separately from the Broadcasting Standards Council. They are much more tightly regulated than programmes. Television advertisements are subject to a pre-vetting arrangement. They cannot go out on the screen unless they have first been approved by the machinery set up by the ITC and the Radio Authority, which both have statutory codes covering advertisement content. Both those bodies have substantial powers of sanction which the Broadcasting Standards Council does not have. They have the right to prevent an advertisement going out; they have the right to stop an advertisement continuing to go out once a complaint has been established; and their ultimate sanction is of much greater severity for those who hold broadcasting licences.
Against that background it seems totally anomalous and undesirable that the Broadcasting Standards Council, which does a relevant job in terms of programme standards in relation to violence, good taste and so on, should have its remit extended to include advertisements. That will produce a good deal of confusion. There have been recent cases where the Broadcasting Standards Council has dealt with a complaint about an advertisement in a way that was totally at odds with what I would call the more serious and substantial regulatory authorities which I have just described.
The way the Broadcasting Standards Council has been dealing with advertisement complaints is in some ways not a matter relating to advertising standards as such but to problems of political correctness. That is an odd thing coming as a form of regulation from this deregulatory government which the Minister quite often recommends to us. I shall not bore him with the details—he has perhaps had details of it—but the Automobile Association recently got into trouble for what was called a sexist advertisement because of the way the woman in an advertisement was portrayed. There are other issues of similar political correctness which seem to excite the Broadcasting Standards Council greatly. I think it is an inappropriate way to deal with this matter.
I am bound to say that if the noble Lord, Lord Wakeham, were here, as a new and effective chairman of the Press Complaints Commission, and it was suggested to him that he was to have responsibility for the standard of advertisements as well as the standard of what goes into the press, he would think it a very curious concept indeed. It is such an odd concept that I hope the Government will consider whether they might use this Broadcasting Bill to remove it from the otherwise worthy work of the Broadcasting Standards Council. I beg to move.
Lord Inglewood: My Lords, I am most grateful to the noble Lord for the way in which he has explained the amendment and I am pleased to provide some clarification. Even if it does not satisfy him I hope that it will explain the Government's position. We believe that it is natural and reasonable that the BSC considers advertisements as an aspect of broadcasting just as capable of causing offence as programmes and that it should therefore he able to entertain complaints on

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advertising, while it is equally appropriate that the commission's other functions—its code drawing, research and monitoring—should extend to advertising.
In 1994–95 the Broadcasting Standards Council received a total of 331 complaints which referred to specific advertisements as opposed to 225 in the previous year. In the context of what appears to be growing public concern at the content of television and radio advertising, we believe that it is right that there should be an independent body to which the public may complain about advertising standards just as they may about television and radio programmes. That is why we cannot support the proposed amendment.
Lord Thomson of Monifieth: My Lords, I am conscious that the amendment was tabled only yesterday. With the greatest respect to the Minister, perhaps I may say that he is reading the standard brief that is somewhere in the files of the Department of National Heritage. I hope that when the matter is considered a little more thoroughly the Government may feel that the arguments I have put forward may have some substance.
Advertising control in particular is very rigorous. I speak with some personal authority in the matter because I was chairman of the Independent Broadcasting Authority in the days when it was in control of television advertising and I was previously chairman of the Advertising Standards Authority. These are important matters. I am totally in favour of a rigorous control of advertising standards, but they are well and properly controlled in a logical and consistent manner with proper sanctions. In this case the Broadcasting Standards Council is a fifth wheel to the coach. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Dean of Thornton-le-Fylde Baroness Dean of Thornton-le-Fylde moved Amendment No. 37:
After Clause 102, insert the following new clause—
TRANSFER SCHEMES: BBC UNDERTAKINGS
(" . Where, in consequence of any transfer made in accordance with a transfer scheme, all the property, rights and liabilities comprised in a particular part of the BBC's undertaking are transferred to a relevant transferee—

(a) the Transfer of Undertakings (Protection of Employment) Regulations 1981 shall apply to the transfer, whether or not they would otherwise so apply, and

(b) that undertaking shall accordingly (whether or not it would otherwise be so regarded) be regarded for the purposes of those Regulations as an undertaking in the nature of a commercial venture.").

The noble Baroness said: My Lords, in moving this amendment I wish to speak also to Amendment No. 38. Both relate to the BBC's transmission services. This is a new amendment but it is not the first time that this issue has been referred to in the course of proceedings on the Bill. It was referred to at Second Reading and at the very end of Report stage, late one evening, we discussed it briefly as well.
Under the Broadcasting Act 1990 IBA transmission services were privatised. At that time there were discussions about whether the BBC transmission
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services should also be privatised. It did not happen in the event but I am told that an indication was given that when the BBC Charter came up for review it would he looked at then.
In 1993 an independent report was commissioned from Coopers & Lybrand about the privatisation of BBC transmission services. The result of that review was that, first, privatisation would not really reduce costs and, secondly, it would not increase competition either. We agree with that view and would prefer to see the BBC transmission services remain within the control of the BBC, even if they were with a wholly separate company to the BBC structure itself.
These two amendments take on board the fact that there has been no indication that the Government wish to change their view that the BBC transmission services be privatised. First, in the event that they are, when this Bill has completed its passage through another place, we seek through these amendments to ensure that the approximately 750 employees of the BBC transmission services are treated in no less favourable a way than the IBA employees when its transmission services were privatised.
As regards the application of TUPE—here I must declare very strong reservations about its effect and what protection it gives to employees—at the time of the 1990 Act, it had not been established and accepted as it is today. We feel that because we do not know to whom these services will be sold off, this clause needs to be on the face of the Bill.
The second aspect of the amendments deals with the BBC staff pension scheme. It is a contributory scheme. I gather that employees pay 4.5 per cent. It is a defined benefit scheme with a proper trustee structure not only under the Pensions Act, but before that when there were employee representatives on the scheme. As we know from experience in the past few years, pensions are an absolutely crucial part of overall income.
Equally, one has to bear in mind that a number of employees work in far-flung places throughout the world—places with wonderful-sounding names such as the Ascension Island. I believe that there are also postings to Antigua. There are quite a number of exotic-sounding places. The problem is that the employees are out there and the employment contracts are based in the United Kingdom together with the pension rights. We believe it absolutely necessary for BBC employees, under the Bill, which will eventually become an Act, to have exactly the same kind of provision that exists in the 1990 Act for IBA employees.
I am told that when the 1990 Act saw its passage through this House the view of the employees of the IBA transmission services was, not to put too fine a point on it, that "the Lords did a good job for us". BBC employees are seeking the same kind of attention and concern, and hope that this House does a good job for them too. I beg to move.
8.45 p.m.
Lord Inglewood: My Lords, the noble Baroness has raised important matters concerning the rights of the staff of the BBC's transmission services which need to

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be considered in the context of the transfer of those services to another body. BBC transmission staff have built up a successful and efficient organisation and one of the BBC's priorities in handling the sale will be to ensure that the interests of staff are properly reflected in the arrangements made.
Like Schedule 5 to the Bill as introduced, the amendments tabled by the noble Baroness are drawn from Schedule 9 to the 1990 Broadcasting Act which set out the scheme providing for the division of assets of the IBA including the transfer of its transmission services. That relating to the Transfer of Undertakings (Protection of Employment) Regulations 1981, known as TUPE, is based on paragraph 4(4) and that concerning pensions on paragraph 9 of Schedule 9.
We believe that the amendment applying TUPE provisions is unnecessary. At the time of the 1990 Act it was unclear whether a transfer of this nature was the transfer of a commercial undertaking and so the provision was taken for the avoidance of doubt. It is now clear that TUPE will apply to the transfer contemplated by the Bill and there is therefore no need for the provision.
The position in relation to pensions is more complex. The provisions in the 1990 Act were required because the whole of the IBA's business was to be divided between the ITC, the Radio Authority and the transmission business. The last formed a significant part of the IBA's work. But transmission is a small part of the BBC's overall activities and involves about 750 out of a total of some 22,000 staff. The BBC pension scheme will continue in existence and those staff transferring to the new transmission business will have the same options as other BBC employees moving employment; that is, to leave their accrued benefits in the BBC scheme where they will be guaranteed to increase each year in line with the retail price index up to 10 per cent., or to take a transfer value payment (TVP) to their new employer's scheme, or to take a TVP to a personal pension arrangement.
I understand that the BBC will be offering independent financial advice to all those affected and that the TVP will be a full and fair valuation of the employees' pension rights built up during their period of employment with the BBC.
I also understand that the BBC believes that the provisions of the Broadcasting Bill, as currently drafted, are sufficiently wide for the transfer scheme to include the transfer of pension commitments. But I recognise that this is a matter of critical concern to the staff of BBC transmission and the Government therefore agree to consider the issue further so that we can reach a definitive and satisfactory agreement with the BBC as to the position on pensions. If necessary, the Government will bring forward an amendment for the avoidance of doubt along the lines of what is provided for the BSC at paragraph 4 of Schedule 4 to the Bill. I hope that that gives the noble Baroness reassurance as to the position as regards the two amendments.
Baroness Dean of Thornton-le-Fylde: My Lords, that was a very detailed reply to an amendment tabled only a short while ago, so I am particularly appreciative of its content and look forward to the result of the considerations that the Minister kindly indicated the Government will apply.
Perhaps I may make one or two points. Although the IBA transmission services were privatised, the fact is that on the sites one finds former IBA staff as part of a company, which I believe is called NTL, and BBC staff working side by side. The IBA services were privatised and, I believe, purchased at something like £70 million; today, they are worth about £300 million. Given that background, their pension scheme, which is still a defined benefits scheme, has obviously been very successful. It has been honoured by the new company and works very well.
The understandable concern of BBC staff is that if the company is privatised to an unknown company, it may not end up as a defined benefits pension scheme but as a money purchase scheme, which would be inferior to the one that exists for the employees. I have heard figures of £100 million rising to £200 million as the possible value of the BBC transmission services. As regards TUPE I received the answer I expected, but it is nice to have it on the record. All that said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 38 not moved.]
Clause 106 [General Interpretation]:
Lord Inglewood Lord Inglewood moved Amendment No. 39:
Page 82, line 27, after ("III") insert (", IVA").
The noble Lord said: My Lords, I have spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Schedule 2 [Amendments of Broadcasting Act 1990 relating to restrictions on holding of licences]:
Lord Inglewood Lord Inglewood moved Amendment No. 40:
Page 88, leave out line 31.
The noble Lord said: My Lords, in moving this amendment I wish to speak also to Amendments Nos. 41 to 45. Those of your Lordships who were present at the time will recall that in Committee we discussed Amendments Nos. 153 and 154, tabled by my noble friend Lord Chelmsford, as a result of concerns expressed by the cable industry about the attribution of audience time against the 15 per cent. television audience share limit proposed in the Bill. It has not been our intention that programme services provided for local delivery service by another channel which holds a UK licence should count towards the cable services' share. We originally felt that the proposed amendments were unnecessary and this intention was reflected in the Bill as drafted. It is on that basis that the Government resisted my noble friend's amendments in Committee. However, once we had had the opportunity to consider with our legal advisers further representations from my noble friend, we concluded that the Bill was after all

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defective in that respect. I am sorry that we got it wrong, and must apologise for any confusion caused by my earlier response.
The amendments, taken together, will ensure that those services which are simply relayed by the cable operator are attributed not to the local delivery service provider but to the holder of the licence to provide the programme service in question. Audience share will be attributed, as intended, to the person having editorial control over the programme, regardless of the means of delivery.
I hope that the amendments will address satisfactorily the concerns raised by my noble friend. I beg to move.
On Question, amendment agreed to.
Lord Inglewood Lord Inglewood moved Amendments Nos. 41 to 45:
Page 89, line 7, leave out (", (0").
Page 89, line 16, leave out from ("provides") to ("may") in line 20 and insert ("one or more satellite television services to which this sub-paragraph applies").
Page 89, line 23, leave out ("service") and insert ("services").
Page 89, line 26, at end insert—
("(3A) Sub-paragraph (3) applies to any satellite television service (other than a non-domestic satellite service) which is provided on a non-allocated frequency and either—

(a) appears to the Commission to be intended for general reception in the United Kingdom (whether or not it appears to them to be also intended for general reception elsewhere), or

(b) is (to any extent) relayed by a local delivery service.").

Page 89, line 27, leave out ("sub-paragraph (3)") and insert ("sub-paragraphs (3) and (3A)").
On Question, amendments agreed to.
Lord Donoughue Lord Donoughue moved Amendment No. 46:
Page 99, line 16, leave out ("20") and insert ("25").
The noble Lord said: My Lords, we have visited this before. We are considering the question of the arbitrary decision to exclude the Mirror Group, basically, from the benefits of the new broadcasting world. The Minister has replied on this point previously, but perhaps I may raise one particular point now. I mentioned at an earlier stage that there was a legal question about the position with regard to the Government's policy before possible European Court action. Has the Minister had the time and opportunity to consider that? Can he give us a view on it? I beg to move.
Lord Inglewood: My Lords, in responding, the noble Lord, Lord Donoughue, raised one point so I shall confine my remarks to that particular point. The noble Lord has once again suggested that the Mirror Group may have a case under the European Convention on Human Rights that our policy is in breach of the convention. I can confirm that, having taken legal advice on the application of Articles 10 and 14 of the convention, we are confident that our policy is within the terms and spirit of the convention, and for that reason we do not feel that this part of the noble Lord's arguments takes our debate any further forward.
Lord Donoughue: My Lords, I thank the Minister for that reply. It is now on the record and will presumably need to be tested and considered in another place. Given that, I beg leave to withdraw the amendment.
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Amendment, by leave, withdrawn.
[Amendment No. 47 not moved.]
Lord Inglewood Lord Inglewood moved Amendment No. 48:
Page 102, line 54, at end insert—
("( ) For the purposes of this paragraph, a person shall be treated as holding a licence if the licence is held by a person connected with him and shall be treated as providing a service if the service is provided by a person who is connected with him in relation to the licence under which the service is provided.").
The noble Lord said: My Lords, this is a minor technical amendment which will prevent possible avoidance of the provisions in Paragraph 8 of Part IV to Schedule 2. That paragraph provides that: a person who runs a local newspaper with 20 per cent. or more of the local market may not control local radio or digital sound programme service licensees whose services account for more than 50 per cent. of the radio points attributable to the relevant area. It also sets a corresponding restriction preventing local radio or digital sound programme service licensees whose services account for more than 50 per cent. of the radio points from controlling a corporate body which runs a local newspaper with 20 per cent. or more of the market in the relevant area.
The amendment will ensure that, in calculating the percentage of radio points attributable to a particular local radio licence holder, proper account is taken of the points attributable to services provided by others with whom the licence holder has a close business or personal relationship. Such "connected persons" are defined in Paragraph 3 of Part I of Schedule 2 to the 1990 Act. With your Lordships' permission, unless pressed to do so, I shall not weary the House by repeating the definition here. I beg to move.
On Question, amendment agreed to.
Schedule 8 [Repeals]:
Lord Inglewood moved Amendment No, 49:
Page 124, line 7, column 3, at end insert—
("Section 182.")
On Question, amendment agreed to.
In the Title:
Lord Inglewood Lord Inglewood moved Amendment No. 50:
Line 4, after ("1990,") insert ("to make provision about rights to televise sporting or other events of national interest,").
On Question, amendment agreed to.
An amendment (privilege) made.
8.55 p.m.
Lord Inglewood: My Lords, I beg to move that the Bill do now pass.
Moved, That the Bill do now pass—(Lord Inglewood.)
Lord Crickhowell: My Lords, I rise to make three points. First, I express my appreciation for the way in which my noble friend the Minister has handled the Bill. He has deservedly won widespread praise for the way in which he has listened and responded to points made in the House. We are extremely grateful to him for that.

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I understand that because of the pressures on officials and parliamentary draftsmen of producing the 2,500 words of the first set of amendments moved today, my noble friend has not been able to bring forward in this House amendments which he had hoped to table on the regional issues which have been extensively debated. I assume that he will tell the House that they will be tabled in another place. Again, I should like to thank my noble friend for the attention that he has given to that important issue. The clause as originally drafted was certainly helpful and it has been improved during the Bill's passage through this House. I believe that one of the great strengths of ITV has been its regional broadcasting. It is extremely important that so much has been done to safeguard that for the future.
I should like to refer to just one other subject. Again, it arises from an amendment which was promised and which will no doubt appear in another place. I was not able to be present on 7th March for our second day of Report stage when there was a curious love-in between all parts of the House in favour of monopoly, and particularly in favour of that monopoly represented by ITN. ITN has provided an admirable news service of which we can be proud. It has also provided good competition for the BBC. However, I am bound to say that the experience of some who have to pay the bills is that it has been quite extraordinarily expensive. It has not had any competitive pressures to bring down its prices, particularly because it is well understood that whatever warehousing arrangements there may be, Carlton and Granada control the company and it is desirable that they should be customers and not just suppliers.
We were told by my noble friend the Minister who responded to the debate that the Government had considered carefully the issue of having a monopoly and had concluded that they could respond to the particular situation by allowing ITN to bring forward other alternative suppliers which the industry could then select. However, that process will happen only once every 10 years. That is a pretty odd form of competition. It was suggested that at least all of the ITN companies are needed to sustain a successful news service. I do not find that a convincing argument.
During the debate there was great praise from a number of noble Lords about the quality of the news service provided by Sky Television. It is a myth to suggest that one must have all 15 of the present ITV customers in order to sustain the service. One of the things we should see is the costs fairly spread, in particular to Channel 4 which will be in a strong financial position after the changes that we debated extensively. At present it pays only prices which reflect marginal costs.
It is an odd arrangement under which the companies which pay the bills have no control over prices. I must say that some of those prices have been excessive and I am surprised that suddenly there appears to be such universal support in this House, in particular from the Government, for monopoly. I hope that the issue will be looked at again in another place and that it will be properly debated, because I fear that it was not in this
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House. Having made that one set of critical remarks, I am pleased to support the Bill and I thank my noble friend the Minister for the way in which he has presented it to the House.
9 p.m.
Lord Chalfont: My Lords, tomorrow is the day of the vernal equinox but the real sign that night has fallen is the fact that the Broadcasting Bill is before your Lordships' House. There is something intriguing about the fact that every stage of the Bill has ended late at night before a dwindling band of what I can only call "broadcasting groupies".
With the support of numerous colleagues, I had intended to table on Third Reading certain amendments seeking to achieve the purpose of those which were withdrawn after government objection during the Committee and Report stages. The purpose of those amendments was to bring the BBC under the complaints procedures of the new Broadcasting Complaints Commission, specifically in relation to issues concerning impartiality and objectivity. In the event, I and my colleagues decided not to do so.
During the progress of the Bill it became increasingly clear that the Government, supported and not to say actively lobbied by the BBC and in consultation with the BSC and BCC, were determined not to accept the amendment nor to make any concessions on the issue. Their principle argument of substance was that the BBC Governors should be given the chance to implement effectively the new agreement that accompanied the Charter which passed through this House on a take-note Motion on 9th January. In support of that proposition they point to certain measures already embarked upon by the BBC.
It is said that the corporation has established a programme complaints unit to investigate and rule on serious complaints. There is a strong case to be made on the idea that any complaints unit of that kind should be an independent body not staffed by BBC officials. However, the Charter and Agreement make no provision for that. We are told that the BBC is also drawing up a new impartiality and accuracy code under the new Agreement, which incidentally incorporates the section in the Broadcasting Act 1990 on impartiality.
Like other Members of your Lordships' House, I received a letter in my morning mail today from Mr. Marmaduke Hussey, Chairman of the BBC, for whom I have the greatest affection, admiration and respect. He set out how the system is intended to work. It is clear, and one must accept, that the Governors of the BBC have acted and intend to act in good faith and in the public interest. However, as I have said on numerous occasions in this House and elsewhere, that is not the point. The problem is not the drafting of codes and guidelines, which is not a difficult matter because anyone can do it. I did it for the Radio Authority, and it has been done for the Independent Television Commission and even for the BBC. The point is the enforcement of those codes and guidelines. Unlike the commercial sector, the BBC has no independent regulator. The complaints process is entirely under BBC control.

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The complaints process runs as follows. The corporation establishes its own codes and guidelines. If they are ignored, as they frequently are, someone may complain. BBC officials are then asked to advise on the complaint. On that advice the Governors of the BBC make their judgment. There is of course a right of appeal open to the complainant, but your Lordships will not be surprised to know that that right of appeal is to the Governors of the BBC. We understand that there is ultimately the possibility of judicial review. It may well be that in future some person or organisation will have recourse to that in law. It is an unsatisfactory situation and we are stuck with it for the next 10 years. To use the more formal and resonant language of the BBC Charter:
"It shall continue in force until the 31st day of December 2006".
The amendments in my name and those of my colleagues were withdrawn at earlier stages of the Bill in the hope that the Government would at least accept the force of the argument and offer some solution or compromise to deal with the problem. That has not happened. Their resistance to any substantial change in this context has been absolute and it does not appear to me to be based on any convincing argument of principle or of practice. Indeed, it seems to be based on the well-known rubric, "My mind is made up. Kindly do not confuse me with the facts".
The Minister was rightly congratulated on the flexibility which he displayed in listening to the arguments on the subject of televised sporting events, coming back to your Lordships' House with a government amendment designed to resolve the problem. I only wish that I were in a position to congratulate him on showing a similar flexibility with regard to independent regulation on matters of political objectivity and impartiality. I hope that I do not offend the House by saying that some of us regard that issue as marginally more important than sporting events.
This Bill will now go to another place where I hope that the issue reflected in my amendments will be subject to further debate and perhaps even to a change of approach by the Government. In the meantime, I hope that the Government will monitor carefully the implementation of the BBC's new Charter and Agreement.
Finally, I must state my view that the case for bringing the BBC out of the archaic concept of the Royal Charter into the real world of statutory regulation is as strong now as it has even been. But, as the noble Lord, Lord Inglewood, said on more than one occasion, we must understand that that is a closed chapter. I find that difficult to accept.
My colleagues and I—and there are many of us who have not yet spoken—would be reassured, as I said before, if the Government would only agree that there is a real problem. I realise that the Government and their advisers, the officials in the department, may have thought that our amendments would have some unfortunate side effects of a commercial, financial and administrative nature in seeking to achieve their purpose. They may even have thought that our amendments were not the best way in which to achieve that purpose. But if they would only concede the validity
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of the purpose and the principle that it is right and proper to bring the BBC, like every other British broadcasting organisation, under independent regulation, it should not be impossible to devise a solution which would be acceptable to all concerned. I hope that we shall not have to wait until—in the words of the Charter—the 31st day of December, 2006.
Lord McNally: My Lords, I was introduced in this House on 9th January. Therefore, this Bill was my maiden Bill. It has been a great experience to follow it through all its stages, not least because I have had the opportunity to act as spear carrier during that time to my noble friend Lord Thomson. I have intervened slightly improperly ahead of him to say that although it is right to congratulate the Minister on his stamina and skill, my admiration for him is matched by my admiration for my noble friend, who has carried out a tour de force in his assiduousness during our considerations of the Bill. I can understand why many in broadcasting still look to him for advice and help.
It has been an interesting Bill. I have been worried occasionally by the way in which the BSC, in its new form, is seen as a solution to almost every problem and seems to have more and more suggestions of powers and responsibilities thrust upon it.
Indeed, to part from what has been in the main close collaboration with the official Opposition Front Bench, I sometimes worry that if places were changed at any time in the future, the new government of New Labour may be just as enthusiastic for a little "nannying" of the broadcasters as are their predecessors. That is where, on a number of occasions at the witching hour, I have come into conflict with, in truth, some old friends, the noble Lords, Lord Chalfont and Lord Orr-Ewing, because I accept, and on these Benches we have always accepted, the icy logic of what the noble Lord, Lord Chalfont, and his colleagues have been proposing. We have been rather happier that the Government have not followed that icy logic to the conclusion. We believe that the BBC, with its responsibilities under the Charter, is worthy of confidence.
Like the noble Lord, Lord Chalfont, received the letter from Marmaduke Hussey. I remember—and it is somewhere in the archives of the Guardian—that when he was appointed, liberal consciences were aroused because they thought that he was a Thatcherite placeman there to do dirty deeds in the BBC. I actually wrote a letter to the Guardian saying that we should give him a chance and that quite often when people are given such responsibilities they accept them with gusto as a kind of Becket figure. I do not know whether Marmaduke Hussey has become such a figure, although he has certainly become so to Members in certain parts of the House. But I believe that he can leave at the end of his term of office feeling content that he has left the BBC intact and duly protected to enable it to carry out its role as the first bastion of quality television in the country. I believe that he should take great credit for that.
The problem that I have had with my old friends could probably best be summed up in the debate on Report where the noble Lord, Lord Renton, said that he found 85 per cent. of the BBC's output to he all right

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but not the sex and violence involved. Incidentally, the noble Lord then went on to criticise the broadcasting of a film which, when I later checked, turned out to be an Oscar-winning film of some social content; but of course it offended him. The noble Lord, Lord On-Ewing, has consistently criticised the BBC's news content, the noble Baroness, Lady Park, does not like the BBC's coverage of history and the noble Lord, Lord Chalfont, wants uniformity in regulation. Indeed, if I have followed his remarks correctly, the noble Lord, Lord Beloff, would just like to horsewhip all the BBC Governors.
The point is that any public body such as the BBC will have a whole range of people who find fault with it. It is the 15 per cent. overlaps that cause the hostility. The truth is that the BBC and, from what I have seen, the Governors have carried out their duties with great assiduousness. Everyone has praised the work of Marmaduke Hussey and expressed confidence in his successor. The House has debated the BBC's Charter at great length. In contrast to the appeal just made by the noble Lord, Lord Chalfont, I advise the Minister to resist, stick by his guns and carry on. I say that because, in contrast to the 1990 legislation, a very practical Broadcasting Bill has been brought forward which is free from the ideological prejudices that warped and distorted its predecessor.
I have one final point to make to the noble Lord, Lord Crickhowell. We are not talking about monopoly so far as concerns ITN or, indeed, saying that it should have a lifelong right to provide news to the third channel. However, many of us are deeply concerned that if news providing to the third channel were fragmented it would not be competition in the way that the noble Lord expressed; it would be a deterioration of service to the viewers in the individual regions. Not only would that be a dis-service to viewers; it would also rob our system of the balance of a good quality news service on that third channel. If for cost cutting reasons—and the noble Lord mentioned costs—the third channel were to lose its high quality news service, the commercial channel would come to regret it. Those are the thoughts of a new boy going through his first Bill. I conclude by saying that the admiration that I have had for the Minister's stamina, patience and good humour leaves me with a great impression of the ministerial quality in this place.
9.15 p.m.
Viscount Caldecote: My Lords, I fully agree with everything that the noble Lord, Lord Chalfont, said but with practically nothing said by the noble Lord, Lord McNally. However, I should like to make a few brief comments, especially on Part V of the Bill. Although I shall be critical of the Government's policy, I echo what other noble Lords have said. I should like to make it clear that I intend no criticism of my noble friend Lord Inglewood, who has piloted the Bill through the House with great skill and courtesy. It is a good principle not to shoot the messenger who brings bad tidings, as my noble friend has had to do on a number of occasions in relation to government policy.
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The trouble started with the presentation of the BBC's Charter and Agreement to the House in a form that could not be amended. In my view, that was a denial of the rights and duties of Parliament and, indeed, of democracy. I hope that no important issue of national importance will ever again be dealt with in such a way.
The shortcomings of the BBC's Charter and Agreement, especially those relating to the handling of complaints on impartiality, could have been rectified by amending Part V of the Bill so that the BSC could deal with such complaints. However, despite the many amendments proposed and apart from a few minor concessions, all the amendments have been turned down by the Government mainly on the ground that the BBC must be allowed to operate under the new charter and agreement on the principle of, "Let's see how it goes".
In my view that is wholly unsatisfactory. The logic of the Government's case for treating the BBC and commercial broadcasting differently is unsound, and the record of the BBC in self-regulation is not all that good. The most recent example indicating a failure by the BBC Governors to instil in their staff high principles and enforce them occurred on the very day after the Dunblane killings when the final line of the comedy "Waiting for God" was,
"Why don't you go out and machine gun some children?".
That the BBC issued an apology through the press does nothing to allay the fears of many of us that all is not well with the direction of the BBC under the largely self-regulatory regime. I believe, sadly, that although we have done what we can to improve the Bill, it leaves this House in an unsatisfactory state. We must hope that its shortcomings will be corrected during its passage through another place.
Viscount Tenby: My Lords, I do not know whether to be relieved or angry that I am not on the hit list of the noble Lord, Lord McNally, although I must say that I agree with some of the things that he says. I wish briefly to associate myself with the words of my noble friend Lord Chalfont, who all through this Bill has presented his case on regulation with both skill and tenacity. To other noble colleagues I offer the same congratulations.
This is an important Bill and many important issues have been satisfactorily resolved thanks to the good will and expertise of noble Lords on all sides of this House, and thanks, too, to the understanding—save for one blind spot—and invariable courtesy of the Minister, to whom we are all grateful; though I for one could have wished that just on one occasion we might have been a little higher in the batting order. However, one major issue remains and it will not go away—that of the mechanics of regulation.
The Government have said that all will be well and that the additional safeguards built into the Bill and into the new BBC Charter and Agreement will stiffen the new BSC and the BBC Governors' sinews in this respect. I have, sadly, to say that there are those of us who do not agree with that view and who believe that fundamental weaknesses remain which it is all too likely will emerge during the next few years.

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At this late stage it would be counter-productive and entirely inappropriate to regurgitate old arguments. I believe we sang the best songs, but the Government, though perhaps half wanting to hum the tunes themselves, chose in the final event not to listen to them but to their various advisers instead. I hope they will not come to regret that decision. I can promise them that we who have certain views in this matter will continue to take an active and, dare I say, inquisitorial interest in this facet of the Bill. I wish the Bill success as it proceeds in a northerly direction.
The Earl of Arran: My Lords, I, too, wish to join the gang of supporters who have praised the way the Minister has conducted the Bill through the House. I particularly praise the courtesy he has shown to noble Lords in all parts of the House. However, I can give only three-quarter-hearted support to the Motion that this Bill do now pass. It might have been full support if I was quite sure that the Bill would properly protect the small ITV regional companies. From the outset I have maintained a consistent theme to try to preserve the very best of regional television from the ravages of a rapidly changing industry.
I tabled—and indeed we debated—at Committee stage an amendment designed to involve the Secretary of State in any future attempt to undermine the network pricing system; the industry device that allows small ITV companies to buy mainstream ITV programmes at a fair rate. My noble friend assured me of a compromise proposal to be introduced at Third Reading. Here we are, but here it is not. Although my noble friend very helpfully wrote to say that it will be introduced in another place it seems that the pressure of bigger amendments has squeezed me out. I am afraid that it is a familiar story. The big issue today is to save our big sporting fixtures for viewers of terrestrial television. The big idea in this very big Bill is digital television—another provision presumably framed for the big companies—not to mention the change in the ownership rules which have already sparked mergers and takeovers. The "big" will be allowed to grow into giants. But what happens to the "small"—those who serve their regions with loyalty, commitment and dedication to local affairs?
It is now widely accepted that the Broadcasting Act 1990 contained, if I may put it politely, a succession of flaws. Perhaps it tried to do too much too soon. I should not like your Lordships' House to be responsible for making the same mistake. I am greatly in favour of the principle of the Bill, but the detail requires much more work yet. So today we are sending a half-finished garment with its trailing loose ends—the small bits—to another place. We must rely on its reputation as guardian of the "small" to complete the tailoring and to avoid a stitch-up.
Lord Prys-Davies: My Lords, the purpose of my involvement with the Bill, with other Members of your Lordships' House, has been to seek to safeguard the quality, range and time given to regional broadcasting, in the event of a bid, and to ensure the quality of broadcasting through the medium of the Welsh language.
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It is satisfying and pleasant to be able to express my appreciation of the Government's response to the anxieties expressed about the future of English language broadcasting in the event of a bid. However, I note the caveat raised by the noble Earl, Lord Arran. I look forward very much to seeing the amendments which the Government have promised to bring forward in another place. I trust that they will be satisfying to the producers and the viewers of regional programmes in England, Scotland and Wales.
As we bid farewell to the Bill, I have a deep sense of frustration about Clause 69. I very much hope that it is not the case that the Government have decided, "This is how it is and this is how it will he". It is still my hope that the Government will come to see as part of the public expenditure on S4C the support of the Welsh language and that they will bring forward amendments to Clause 69. However, I cannot leave the clause without expressing my appreciation of the contribution of all those Members of your Lordships' House who have participated in the debates on it. I refer to my noble friend Lord Cledwyn of Penrhos, the noble Viscount, Lord Whitelaw, who intervened this evening, the noble Lords, Lord Aberdare—he has been steadfast in his support—Lord Thomson of Monifieth, Lord Elis-Thomas, Lord Geraint and my noble friend Lady Dean from the Labour Front Bench. I am sure that Wales and S4C are very much in their debt.
Finally, I thank the noble Lord, Lord Inglewood, for the sensitive—that is the word which comes to my mind—manner in which he has handled the Bill and the attention he has given to our amendments. If the rules of the House allow me to say so, I would say: "Diolch yn fawr iawn".
9.30 p.m.
Lord Orr-Ewing: My Lords, like others, I feel that it is sad that we have spent one day on the Second Reading, four days on the Committee stage, two days on the Report stage and one on the Third Reading. The common factor is that the important amendments all came after 11 o'clock at night. That was to ensure that no one could divide the House. It was purely accidental, of course, because the Chief Whip has been trying to ensure that we make progress with the Bill. However, it has not worked out and we have not had a genuine opportunity to put forward our points. We could well have done so. There is good information and experience in all parts of the House and we could have had a good debate and possibly persuaded the Minister of our case. He has been wonderful throughout, patient and considerate, but he does not seem to have been allowed to persuade people higher in the hierarchy or in the department to accept our views.
It is strange that the Government insist that the utilities like gas, electricity and water have a regulatory authority. However, the one organisation for which there is no regulatory authority except itself, arid which is both judge and jury in its own case, is the BBC. It has more influence on every home in the land than any other element of our civilisation. This must he given proper

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consideration in the other place and I hope that the points put forward by everyone in this House will be examined there.
We had hoped that the BSC would be provided with some bite and that was even echoed at one stage by the Benches opposite. There was a general feeling that the time had come to say: "Enough is enough in the last 10 years of the Charter", before we go to other facilities. Many of my friends and I believe that it is right not to go to a Royal Charter. There are 443 other Royal Charters, the idea that it is exceptional and we cannot debate anything that is in the Royal Charter is for the birds. It is not for the Houses of Parliament.
If we have legislation in another place and debate it up here, I and many others will welcome it. How can we have the ITC regulating one half and the other half regulating itself, especially if it receives £1.8 billion of taxpayers' money to operate? I hope that taste, decency and impartiality will all be covered by the BSC.
We discovered last April that the producer guidelines were voluntary. We had all praised the 250 pages of the document on producer guidelines and said that it was good, beautifully worded. The only trouble was that no one ever read it, or if they did, they never took any action on it. All kinds of problems filtered into public service broadcasting.
I wish to give two examples of that. Today I received a letter from Duke Hussey which was sensible and encouraging. I hoped that he would ensure that the governors—responsible, respectable people—would take action. The two examples I take occurred during the last year. One was a programme called "Good Fellows" which was shown last April and repeated in June. The programme occupied 145 minutes in the evening with 212 occurrences of the "f' word. "We uphold taste and decency", we are told, but no one seems to have been ticked off or penalised in any way.
There were other examples, but no action was taken—particularly in relation to the programme on the Japanese nuclear bomb. Previously, six years before, it had shown a Marxist from the United States saying that the dropping of the nuclear bomb on Japan led to the Cold War, which endured for 25 to 30 years or more. An apology was received the first time round. There was no apology the second time, and no rectification of history. Fortunately, six renowned British history professors came forward and said that it was totally untrue. We squeezed an apology out of the organisation the first time round, but not the second time. So this is continuing, even though there are codes of conduct. All of us who are sitting here now sincerely hope that the new governors will be able to take action.
There is another awful example. Alas, the day after the shooting of the children in Dunblane, the amazing last line of a comedy programme was: "Why don't you go out and machine-gun some children?". The Secretary of the BBC apologised when the noble Viscount, Lord Caldecote, got in touch with him. Apparently, the complaints commission would not take the matter seriously. He admitted that he had made an apology.
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However, it turned out that he thought it unnecessary to apologise on the TV channels but had apologised in a newspaper. That was the Secretary of the BBC.
Most of what the BBC does is very good. But certain opportunities seem to filter through to lesser people who totally disobey the rules. Incidentally, I hope that the new code of conduct now being written will be firmer. I also hope, as we once suggested in an amendment, that those people who hold producer or editorial responsibilities, read the code, sign it and activate it, as you have to sign the Official Secrets Act on entering the Ministry of Defence. (And, by the way, when you leave you have to sign it again.) The same should apply to people who have these huge responsibilities for the well-being of the mental state of our nation.
I return to congratulating Duke Hussey on what he has done. He has achieved a considerable amount. He got rid of 5,000 people, and the organisation goes on very well without them. That must have saved quite a lot of money. I believe he now has 20,000 people. The huge list of those taking part in drama of any sort goes on forever. The credit titles seem to pour forth from the screen. I hope that he will make further economies.
Finally, as I ought to have said in my speech last time, some of the young people are responsible for the irresponsibility shown in certain selected items. Many of them enter the BBC when they are quite young and make their mark. After they have been there only a year or two, with no loyalty either to the BBC which they serve or to the nation which they also serve, they go off to Hollywood and get jobs at four times what they can raise in this country. Such people should be disciplined, and perhaps penalised, as a result. I hope that before the Bill leaves both Houses, we shall give some penalising powers to the new BSC.
Lord Renton: My Lords, first, I repeat the congratulations that have been offered to my noble friend Lord Inglewood. He has shown the most amazing grasp of the tremendous detail in this Bill and of the amendments moved in relation to it. He deserves congratulation.
I gladly support the Bill so far as it goes. But it does not go far enough in certain respects. I hope that the Government will keep an open mind over some outstanding matters as the Bill goes through another place.
The BBC has some great achievements to its credit. But there are other matters on which I have to say it fails badly to this day. I shall come to chapter and verse on this in a moment. My main concern relates to the amount of violence and sex on television. Up to now neither the broadcasters nor the staff of the BBC, nor always the staff of the independent companies, nor the British Standards Council between them have succeeded in reducing substantially the amount of violence or explicit sex on television, even though the governors and staff of the BBC all claim that they are dealing with the problem.
At about the time that the Bill was introduced, it produced for public circulation a most interesting document, headed: "The BBC, a responsible broadcaster". It deals with:

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"Taste and decency … the watershed … violence … the level of on-screen violence … producer guidelines published and strengthened by the BBC [and] the BBC's responsible approach to buying and classifying films".
I only wish that they would practise what they preach there.
I shall give your Lordships a little of the chapter and verse. The first page is headed:
"The BBC seems to abide by high standards of taste and decency".
It goes on to say that the BBC is:
"required to do all it can to ensure that its services 'do not include anything which offends against good taste or decency or is likely to encourage or incite to crime or lead to disorder or to be offensive w public feeling'".
That is splendid, but it has not kept up to those standards.
Only the governors can intervene under the law as it stands and under the law as it will stand. They are to be the only regulators. But they are not independent. The independent television companies have an independent regulator. There is no reason why the BBC should not have one. Yes, the governors are splendid people. The vice-chairman is sitting opposite us and he is a man for whom we all have a high regard. But despite him and all the other governors, those defects have continued week after week. The Government must apply their mind to this matter. They must have a fresh mind on that point.
The next page of the document deals with the watershed. It says:
"The BBC is committed to maintaining the effectiveness of the watershed … The 9 pm watershed works well and is widely understood".
That is not true. There are three reasons why the watershed fails to give the protection to young people that it should give. The first is that some violence is occasionally displayed before 9 p.m. I have seen it myself and been rather surprised. The second reason is that many children, as we all know, sit up much later than 9 p.m., especially if their parents are going out for the evening, and that can often happen. Thirdly, many households have videos. Whether turned on by the children or parents, videos can be used to record during the watershed period late programmes which can be seen by the children on another day or another evening. So what is claimed about the watershed cannot be sustained.
The next page deals with violence on television. It claims:
"Over recent years, the BBC has tackled the issue of violence on television".
I shall not trouble your Lordships with the whole of the contents of that page, though one could pick it to pieces. At the bottom of the page it says:
"sufficient information [is] to be given to viewers to enable them to decide whether they want a particular programme to be watched in their households".
That would be splendid. However, I must confess that, as a widower living alone I often turn on the television, especially at weekends, but I have never once heard that
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warning given. If such a warning is needed, I suggest that the programme is likely to be one that should not be shown at all.
The next page concerns the amount of on-screen violence that is shown. It suggests that it has fallen markedly in recent years. I wish that were true. When one studies the complaints bulletins, one knows that violence is still being shown. Many of the complaints are upheld, not only of the BBC but of independent companies also. A rather interesting sentence states,
"Most"—
I emphasise that word—
"violence occurs after the watershed".
That confirms the view I expressed earlier that some violence is shown before the watershed.
Under "guidelines for its producers", the document states:
"The BBC requires producers and directors to avoid sadistic violence".
I do not know whether "Trip-Trap" was a programme referred to as being one that I ment:.oned, but on Saturday 9th March, after we had completed proceedings on Report stage, that film was shown from 9 until 10.30 in the evening. The film concerned prosperous people living in a large house and the husband cruelly assaulted his beautiful blonde wife. He pulled her by the hair when he knocked her to the ground and two quite young children were in the background. I felt so strongly that it should not have been shown, especially after the professions of innocence contained in this document, that I made a formal complaint to the Broadcasting Standards Council.
As has been said, unless something is done, we must suffer 10 more years of uncertainty. I say to my noble friend Lord Inglewood—and I hope he will tell his Secretary of State—that instead of waiting 10 more years, let us deal with the matter in the ways suggested by the noble Lord, Lord Chalfont, and others; that is, during the next 10 weeks when the Bill is passing through another place. If we do that, posterity may be grateful to us.
9.45 p.m.
Lord Thomson of Monifieth: My Lords, at this time of the evening I shall not follow the noble Lord, Lord Renton, and others who spoke like him. My noble friend Lord McNally gave his views, which follow the traditionally libertarian position of these Benches. When he spoke I thought I was hearing my former colleague, the late Lord Bonham-Carter, on the same subject in the 1990 Bill. However, I shall confine myself to what is the more traditional habit of Third Reading debates after a long Bill, especially since, when I was passing the office of the noble Lord, Lord Graham, on my way to Hansard a few moments ago, I happened to glimpse Nottingham Forest playing Bayern Munich. There is still apparently some good football on terrestrial television and it occurred to me that I could be home watching it instead of participating in the final stages of this Bill. Perhaps tomorrow night I shall have that good fortune.

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It is with some pleasure that I view the final passing of this Bill from your Lordships' House and an end to the long days and nights that we have experienced. It has been a long and complex Bill. I join with everybody else in paying tribute to the Minister, the noble Lord, Lord Inglewood, for his stamina, his patience, his good humour and the clarity with which he deployed the Government's case on the Bill. It is a major Bill introduced into your Lordships' House first rather than the other place, as so often happens, and it has been a heavy responsibility.
It is, as has been said, a much better Bill than its predecessor, the 1990 Bill, which was disastrous for independent television. I think we can all say with a modest glow that it is now an even better Bill than it was when it was introduced into your Lordships' House. It is now to be sent to another place, and the fact that it is a better Bill is, first of all—we might as well give ourselves a little pat on the back—due to the persuasiveness of your Lordships on all sides of the House in the arguments that you have put to the Minister. But it is also due to the willingness of the Minister to respond to the arguments and to propose quite a number of improvements to the Bill. However, as has been said in other quarters and from other points of view, there are still further improvements to be made to the Bill which we hope may be made in another place.
I echo the words of the noble Earl, Lord Arran, about the position of the smaller regional companies, about which I feel as strongly as he does. The original clause that the Government put in the Bill on these matters was a good clause and a reassuring clause. The Minister was willing to see it strengthened in various ways. I fully accept what he said in his correspondence—that the sheer pressure of the draftmanship of amendments has prevented the promises he made being fulfilled here on Third Reading. But we shall all of us watch carefully what happens in another place to make sure that the strengthening of the regional safeguards does take place. In particular, I echo what the noble Earl, Lord Arran, said about fulfilling the commitment on the network pricing system and giving the Independent Television Commission the necessary responsibilities and powers to safeguard that.
I am sorry that the noble Viscount, Lord Astor, is not still with us. I hope very much that the question of conditional access for analogue broadcasting, which we came very close to introducing in the Bill, will be followed through in another place. Then there is the matter of unbundling, where we became a little unbundled ourselves earlier this afternoon. I hope very much that it may also be pursued and brought to an effective conclusion when it goes to another place.
Finally, I know I carry the noble Earl, Lord Stockton, with me in the hope that another place will do better, not only on the Channel 4 funding system, but on the whole ITV funding system than we were able to with the Minister this evening.
I again thank the Minister for the way in which he has handled us. A great debt of gratitude is also due to those who have been behind him—to the staff in the
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department, the draftsmen and the others who have worked very hard on what has been a complicated Bill, dealing with many different aspects of future broadcasting policy.
Lord Donoughue: My Lords, I shall not conduct another Second Reading debate, although I am not happy with the broadcasting landscape described in this Bill, a landscape increasingly dominated by commercialism and the commercial giants, where quality values are bound to be diminished. However, I want to thank everyone involved in the conduct of the Bill. I join in the thanks to the Minister for the courtesy and positive way in which he has handled it and for the few concessions we have managed to wring out of him—not enough, but I thank him for what concessions there are. I thank the draftsmen who have drafted the Bill, and especially I would like to thank my own team who have done most of the work. Most of them are now, quite sensibly, in bed—
Lord Renton: They are watching television!
Lord Donoughue: They are watching television? Maybe—except my noble friend Lady Dean who, as always, is here to the sleepy end.
It made the Bill more interesting that it came here first and not to the Commons. Someone said to me that that was because it was non-controversial. I was intrigued by that. I have never before seen such a volume of briefing and lobbying. Technically the Bill was complex and involved much homework, which on this side is unpaid homework. It was in some ways a political minefield. The media pressure groups were remarkable to see because they care very much about what we do in their area. It was not possible to please all of them and I am delighted to say that we upset some of them. We had only two Divisions, which is not many for a large Bill. But they were good Divisions. There were 209 votes for the Government and 327 against. That seems to me to be about right, and long may it continue.
Our big vote was on sport, which ironically was not in the Bill at all. The other issue—the noble Lord, Lord Thomson, referred to it—was conditional access. It was painful that we did not pass the amendment, but I am sure that another place will return to the issue. If we can knock some sense into the Department of Trade and Industry—I know that is a thought of fantasy—we may get progress. There is work still to be done, but the House can be pleased and proud of itself that we have cleared the way. We have identified some of the landmines. There is still the unbundling of sporting highlights to be put right. But I should like to thank all concerned for their contributions to the Bill.
Lord Inglewood: My Lords, this Bill will provide a framework for the development of digital terrestrial broadcasting and provide new freedoms for media companies to grow and succeed in an increasingly competitive marketplace.
In introducing the Bill, I pointed out that it covers an enormously complex range of issues, and looked forward to listening to your Lordships speaking with the

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plurality of voices we in government are keen to encourage. Our debates have shown that this House fully reflects the range of views that have been aired in the wider world.
I also expressed the hope that our debates would proceed on a non-partisan basis. I believe that this wish has been realised, and I thank all your Lordships, but in particular, the noble Lords, Lord Donoughue and Lord Thomson of Monifieth, for that. While it may often seem that the apparatus of government is largely switched to "transmit", it can also be tuned to "receive". I hope I have shown the Government's willingness to listen and respond to well reasoned suggestions for improving our proposals, which we brought forward with some speed to enable digital terrestrial to get off to an early start in this country.
Time does not permit me to cover all the contributions that have been made to the debate. Although it may be thought invidious to single out particular individuals, it would be equally remiss of me if I failed to acknowledge the main protagonists and to put a number of points on the record. Perhaps pride of place should go to the movers of the first amendment at Committee stage, whose efforts on behalf of sport briefly secured them pole position in the Bill. They gave the Government a clear indication and they achieved a notable victory in the Division Lobbies which more or less coincided with the Leader of the Opposition drafting the death warrant of your Lordships' House in its present form—or so he hopes. It was an emphatic response which your Lordships gave to our consultation exercise and gave a very clear indication of which of the options in our consultation document your Lordships favour. I believe that the amendments which were agreed earlier today show that the Government have taken heed.
This is a Bill to take broadcasting into the next century. Digital technology will revolutionise broadcasting. There will be more channels and more choice. For the legislators, I fear, that could mean more opportunities for getting it wrong. Our debates on the provisions relating to digital terrestrial broadcasting have shown how difficult it is to legislate for technologies whose potential is as yet unrealised and sometimes unclear. But I believe that Parts II and III of the Bill have been improved in ways which will help give digital terrestrial broadcasting the best possible prospects when it is launched.
There was a danger that these debates might have allowed the technophile sheep to gambol in the glorious fields of digital multiplexing and non-switched broad-hand communication, leaving the technophobe goats to shake their heads and retreat elsewhere to more convivial pastures or even to watch television. I am pleased that that did not happen. Certainly, several of your Lordships have moved from analogue to digital, sometimes simulcasting and sometimes on new specialist channels. I would like to mention in particular my noble friend Lady O'Cathain, with her determination to understand the issues at the technical level in the interests of the lay audience, and on the Benches opposite, the noble Baroness, Lady Smith of Gilmorehill
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who displayed a comprehensive grasp of the complexities of digital audio broadcasting in her first contributions to your Lordships' House.
One of the most important things about our debates was that we did not allow ourselves to he seduced by the technology. Properly, we focused the interests of viewers and listeners, and the future prospects for the British broadcasting industry. The noble Lord, Lord Ashley, in his customary forthright and vigorous style, cogently argued the interests of those with disabilities, while many others, equally trenchantly drew attention to the proper interests of various categories of viewer and listener. There is a balance to be struck between their particular interests and the need to ensure that we create the right framework for investment in digital terrestrial broadcasting, without which nothing will happen. I believe that the Bill, as it leaves this House, has achieved that balance.
I am afraid that pressure on parliamentary counsel's time—not least in drafting the 5½-page sports rights amendment—has meant that it has proved impossible to table the proposed amendment dealing with analogue switch-off. I assure my noble friend Lord Stockton—and I have written to him to this effect—that the Government will bring forward the necessary changes in another place. Similar considerations apply to the proposed amendment allowing S4C to develop commercial services on digital. Again, that deficiency will be remedied there.
In Committee the noble Lord, Lord Donoughue, introduced the debate on the media ownership provisions in the Bill by saying,
"we have now entered the Schedule 2 world of ceilings of 15 per cent., 20 per cent., 25 per cent. and 50 per cent. … and of point systems beyond my capacity to calculate".
Having heard the quality of the debates, I do not believe that the necessary complexity of our proposals proved a barrier to constructive debate, although I suspect that the noble Lord's arithmetic is rather less modest than he may have tried to suggest.
My noble friend Lord Dixon-Smith and the noble Lord, Lord Desai, joined forces with my noble friend Lady O'Cathain to argue for a relaxation in the rule limiting local radio stations to one service on each waveband in areas of significant overlap. I hcpe that the assurances I have given them tonight will demonstrate that we have taken on board the points made in debate.
One of our main aims is to allow British media companies greater scope to respond to technological change while maintaining diversity and plurality at regional and local as well as national level. Some of your Lordships, most notably the noble Lord, Lord Harris, argued for a simpler and even more relaxed regulatory regime than we propose, while the noble Lord, Lord Donoughue, invited us to reflect on whether the Mirror Group should benefit from higher thresholds. It will come as no surprise to hear that I believe that we have got the balance about right.
I should like in particular to thank the noble Lord, Lord Thomson of Monifieth, for so helpfully bringing his long experience of broadcasting into the debates, not only on digital issues, but also on amendments relating

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to particular arrangements in the 1990 Act. Similarly, my noble predecessor, my noble friend Lord Astor, repeatedly put forward helpful suggestions on a variety of topics.
A number of your Lordships—and here I mention the noble Lord, Lord Kirkhill, my noble friends Lord Kinnoull, Lord Crickhowell and Lord Arran, and the noble Lords, Lord Elis-Thomas and Lord Prys-Davies, rightly sought to protect the distinctive regional programming which has proved so successful in enriching the lives of viewers and of listeners.
Clause 68 has been widely welcomed for the protection it affords to regional programming and production where there is a change of ownership in a Channel 3 company. Noble Lords will recall that, rather rashly as it turned out, I promised to bring forward at Third Reading several amendments strengthening the clause in line with suggestions by my noble friend Lord Kinnoull and others. Again, regrettably, pressure on our legal draftsman have made this impossible. It remains our intention—I emphasise this to my noble friend Lord Arran and the noble Lord, Lord Prys-Davies—to bring forward these amendments at the earliest opportunity. I have written to noble Lords who have shown an interest in the clause to explain our proposals more fully.
I should also like to thank noble Lords from Wales for their contributions to our discussions on S4C, which for me, a non-Welsh speaker, were particularly helpful.
The question of Channel 4 funding has generated much discussion and numerous written representations from all sides. Without wishing to understate the importance of this issue, I pause only to acknowledge the powerful contribution to the debate made by my noble friend Lord Stockton.
I should offer a further apology to your Lordships that the clauses relating to independent local radio are not yet ready for consideration. However, as I have indicated previously during the passage of the Bill, we shall be making provision for renewal of ILR licences. In addition, we intend to bring forward an amendment to clarify the circumstances in which the Radio Authority need not re-advertise an expiring ILR licence under Section 104(5) of the 1990 Act. It will provide for the authority to invite expressions of interest in an expiring independent local radio licence and for such parties to demonstrate their firm interest with a financial bond. Those amendments will also be introduced in another place.
I should like to thank the noble Lord, Lord Barnett, for bringing to the House's attention the issue of the provision of news on Channel 3 which has in general been supported on all sides of the House. In the Report stage debate on his amendment, Amendment No. 165, on the provision of news on Channel 3, I said that the Government agreed with the purpose of the amendment and were persuaded that there were significant benefits in requiring Channel 3 to have a single news provider. I undertook to take away the noble Lord's amendment and to introduce a government amendment at Third Reading which would enable the ITC to nominate as
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many news providers for Channel 3 as it deems fit, but would require the ITV companies to choose a single provider from among those to meet their news requirements. Again, I apologise that the clause is not yet ready and I regret the inconvenience that that may have caused. The amendment will be introduced in another place.
The noble Lord, Lord Chalfont, my noble friends Lord Caldecote and Lord Orr-Ewing and the noble and learned Lord, Lord Ackner, raised a number of important issues relating to the merger of the Broadcasting Standards Council and the Broadcasting Complaints Commission. I am grateful to them for their detailed, reasoned and tenacious contributions to the debate, where their views were equally tenaciously opposed by the noble Lord, Lord McNally. They raised matters of considerable importance relating to how broadcasters in general, and in particular the BBC, should be regulated. They focused particularly on the important matter of impartiality.
I very much hope that the clarification in the BBC's Charter and Agreement and the recent exposition of the way in which the BBC handles such matters now will provide reassurance that the method which the Government believe is right for the regulation of the BBC—that is to say, self-regulation by the governors—not only works but works properly. I should like to emphasise that these, and particularly impartiality, are matters about which the Government and the Secretary of State are very concerned and which they will not allow to pass out of their minds when this piece of legislation leaves Parliament for the statute book.
The noble Baroness, Lady Dean, played a significant role in our debates and in particular, on the basis of her experience as a member of the Broadcasting Complaints Commission, has made a number of helpful suggestions which we have been pleased to take up.
I should like to give special thanks to my noble friend Lady Trumpington, who I am sorry is not with me on the Front Bench on the final leg of our journey. Without her indefatigable support and guidance my task of piloting the Bill through your Lordships' House would have been far more difficult.
Finally, I should like to record my thanks to the officials in the department who have done so much work, and to parliamentary counsel, whose life this Bill, and the changes that your Lordships' persuasive arguments encouraged me to accept, have made somewhat fraught over the past few weeks.
In conclusion, I am confident that the Bill has been improved and I thank your Lordships for that and for the constructive and helpful way in which it has been achieved. It remains to be seen what further amendments may flow from its consideration in another place, but we believe that the British viewer and listener, the broadcasters and the wider industry will benefit from what has been achieved in this House. I commend the Bill to the House.
On Question, Bill passed, and sent to the Commons.
House adjourned at ten minutes past ten o'clock.