§ 5.33 p.m.
§ Lord Gordon of Strathblane rose to call attention to the White Paper.A New Future for Communications (Cm 5010); and to move for Papers.
§ The noble Lord said: My Lords, I am glad that my good fortune in the ballot affords us an opportunity to debate the recent White Paper on communications. When legislation is introduced, it will clearly affect every individual in the land and it is good to know that perhaps points may be raised in this afternoon's debate that the Government will wish to take into account before framing the Bill, which I look forward to seeing later in the year.
§ The main proposal of the White Paper is, of course, the creation of OFCOM, replacing the current functions and duties of various regulators. I confess that I am an agnostic as to whether the creation of a single regulatory body is the best solution, or whether much the same result could have been achieved by ensuring better co-operation between the existing regulators. However, I am quite happy to go along with the Government's view that OFCOM is the best option, provided that the distinct regulatory roles regarding broadcasting are preserved, including separate regulation of radio and television. In this connection, I should declare that I am Chairman of Scottish Radio Holdings.
§ It is obvious that technology and broadcasting interact very closely, affecting not only the transmission but also the content of programmes. The advent of colour, for example, greatly increased the popularity of sport on television. Satellite communications have clearly made us a global village on the one hand, while, one the other, they have perhaps made it more difficult to cram news from all over the world into a half-hour bulletin that was designed for a time when we could only get such pictures from the United Kingdom. In radio, the advent of the transistor radio transformed radio from a large set sitting in the corner of a room when listening decisions were essentially a family matter to one where it was a matter of individual choice, with a dramatic impact on the sort of programme that teenagers, for example, were then able to demand.
§ In one important respect technology impacts very closely on one of the fundamental tenets of public service broadcasting, which is universal access. In this context, I must say that. I believe the White Paper has got it wrong. It is, I think, a serious mistake to impose a 1224 "must offer" obligation on public service broadcasters without a corresponding "must carry" obligation on satellite owners. Otherwise the negotiating position of the platform owner is unfairly strengthened, and there could be a huge transfer of resources from terrestrial public service broadcasters to the satellite owner. I should remind noble Lords that, in the past, transmitters were owned in the independent sector not by the broadcasters but by the regulator, the IBA. The transmission systems of both ITV and BBC have now, of course, been privatised, but with considerable safeguards.
§ I ask your Lordships to look ahead to the time when we have analogue switch-off and all our transmissions are digital. At the moment, we have two platforms: digital terrestrial television and satellite. Unless something is done to improve the coverage of digital terrestrial, I believe that satellite will undoubtedly have the upper hand. I freely concede that satellite is highly effective; indeed, only a month ago when I decided that it was time our family moved into the digital age, we opted for satellite simply because there was not an On Digital signal available in our area.
§ But it is surely clear that we cannot allow our entire broadcasting system to be dependent on a platform that the Government cannot effectively regulate, both as to access and as to the terms on which access is granted. If the Government feel that they are unable to do this, there is really no alternative but to increase our reliance on digital terrestrial television so that we do not find ourselves beholden in the future to the platform owner of a satellite who may not always wish to act, or be willing to act, in the way in which the government of the day would wish.
§ If, however, the Government can adequately control the terms of access to the satellite platform, then I must confess that, if cable operators are required to carry public service broadcasting free of charge, I can see no reason why satellite platform operators should be allowed to charge—except perhaps the minimal cost of encryption where that is required. Are they seriously suggesting that television even in a digital age could attract an audience without the current terrestrial public service broadcasters, which still account for well over three-quarters of all viewing? They need the output of BBC, ITV and Channel 4.
§ That brings me to another minor criticism of the White Paper; namely, that I do not believe that it does enough to encourage the take-up of digital. I was a member of the committee that recently looked at the funding of the BBC. One of the reasons that I disagreed with my colleagues on the imposition of a digital licence fee, which was one of the options under consideration, was precisely that it would discourage a take-up of digital television. The Government fortunately shared that view. But if they really want the nation to move towards a digital system they must do more to encourage the take-up. In this connection, it is distressing to note that the vast majority of television sets being sold are still analogue sets. Once the date for analogue switch-off has been decided, it might be worth the Government considering mandating the inclusion of digital receivers in all sets 1225 sold over, say, the prior three years. However, in the meantime, it might be appropriate to ensure that the term "digital", which is currently used far too widely and misleadingly, should only apply to sets that can actually accept digital signals.
§ I was glad to see that the White Paper came out strongly in favour of regulation of content and public service broadcasting. I think it should go further in that the public service regulations should be identical for BBC, ITV, Channel 4 and Channel 5—as indeed they were in the case of BBC and ITV in the last Labour government when the noble Lord, Lord Merlyn-Rees, was Home Secretary. He produced a White Paper on broadcasting in 1978. For similar reasons, I would have the BBC fully under OFCOM, just like ITV, as regards programme content, and its usage of spectrum under the same control as, for example, is the Radio Authority under the new radio division of OFCOM.
§ Public service broadcasting is essentially about trying to elevate public taste by persuasion rather than coercion. The Reithian view that broadcasters have an obligation not only to give the public what they want but a tolerable leavening of what a civilised consensus would indicate they should have, offends both libertarians—they do not believe that there is better and best—and extreme free marketeers who think that that should be left safely to the market.
§ Yet the chief merit of public service broadcasting is its respect for the audience. It believes that if we are to elevate public taste as well as to entertain, we must win the loyalty as well as the respect of our audience. We must be in contact with them in much the same way as a magnet must be close to metal before it can move it in any direction. It is only elitist in the sense that it believes that the best in human thought and achievement as well as entertainment should be made available to all; and the triumph of British broadcasting, both BBC and independent, has been to demonstrate that the best can attract huge audiences as well as critical acclaim.
§ But there is a third and dangerous siren voice: technology. I should like to see the Bill put a duty on OFCOM to have regard to the overall health of the system in considering the licensing of new services. We must resist the technological imperative whereby invention has become the mother of necessity. Technology dramatically increases the range of options open to us but it does not, and must not, determine how they should be used. Decisions on the number of services we have must be based not on technical considerations like the spectrum efficiency of digital broadcasting but on listener and viewer demand and the availability of resources, both human and financial, to provide the programming they wish. Few people would want to admit publicly that as human beings we are powerless to control the technology we have created. Somehow technology seems to mesmerise and freeze our critical faculties and 1226 produce a sense of inevitability about the nature and direction of change that comes pretty close to an abdication of responsibility. Of course, there is a role for the market place and the BBC paid a heavy price in the early 1960s for failing to recognise that the growth of cheap radio receivers and the increased spending power of teenagers had transformed dramatically the nature and tastes of its audience. Arguably, the introduction of Radios 1, 2, 3 and 4 were 10 years too late.
§ I certainly do not suggest that we now freeze the number of services at the present level. I do suggest, however, that the criterion for the introduction of new services should not be simply the availability of frequencies and aspirant groups wanting to run them—those are prerequisites but not determinants—but rather some evidence, and research can help us, that there is an adequate listener demand for such a service and the funds to fund it. In this, I counsel OFCOM and the Government to pay even less attention to the clamour of those who want to provide new services than they do perhaps to the protectionist fears of incumbents who do not want them.
§ Similar thoughts govern my thinking on ownership rules. The White Paper disappointed many by not being more specific. The Government have indicated that they are content to have one company for ITV, yet seem to be pussy-footing around with radio. In radio, there is already the BBC and three separately owned independent national services and it is difficult to see the need for any further constraint on the consolidation of independent local radio. I would also suggest that it could well be in the public interest.
§ I recognise that deliberation on changes to cross-media ownership rules may have been required because many of the perceived synergies also raise delicate public interest considerations. But the case for liberalisation of ownership rules within radio itself is much more clear cut and should be proceeded with separately and quickly.
§ In broad terms from the point of view of the listener, I suggest that plurality of ownership, far from producing diversity of output, may in fact reduce it for reasons of both motivation and availability of resources. It is perhaps obvious that if a single owner has several radio stations in the one market place, it is in his own self-interest that different services will be provided and listener choice enhanced. Happily, this also coincides with the public interest. Separate owners, however, although promising different services, may tend to use similar programming to reach the same target audience which is most attractive to advertisers.
§ Pressure on resources and a consequential reduction in the amount of money available to be spent on programming will also be very much greater if they are under separate ownership. A common owner can obviously amortise administrative overheads over a number of services thus leaving more resources available for the attainment of quality and diversity in 1227 programme making. Historically,' when independent local radio stations were required to cease simulcasting on FM and AM and instead produce separate programming streams, it was the biggest leap in listener choice we have had in the independent sector. Unfortunately, ownership regulations prevented the AM service being broadcast on FM, thus making it more acceptable to listeners. It is perhaps no coincidence that since independent radio tends to cater for an older age group on AM, it is the one segment of the population in which the BBC still enjoys the highest market share because Radio 2 is available on FM and is now the BBC's flagship service.
§ Advertisers are always looking for more choice but they sometimes forget that more choice tends to diminish individual market share for each participant. You cannot have mathematically BBC, ITV, Channel 4 and another service all with 50 per cent market share. It does not work. That is why I think that, in licensing new services, OFCOM should have regard to the overall viability of the broadcasting market place as a whole; otherwise there is a very real danger that even the most successful services will gradually have their audiences and consequently revenue whittled away and that, as a result, overall quality will suffer. I feel sure that this is something the Government would wish to prevent. I commend the suggestion to them. My Lords, I beg to move for Papers.
§ 5.47 p.m.
§ The Earl of Northesk
My Lords, I congratulate the noble Lord, Lord Gordon of Strathblane, on securing this important debate. Time is short and I therefore confine myself to a single aspect of the White Paper: higher bandwidth services.
We are all aware of the Government's stated ambition to make the UK the best and safest place in the world for e-commerce. At its best this offers reassurance that Ministers are aware of the crucial importance of the knowledge economy to the future competitiveness of the UK. Indeed, the White Paper is peppered with a plethora of lofty pledges articulating the Government's commitments.
In this context, broadband matters. The difference between current narrowband connection rates of 56 kilobits per second and those of broadband of 2 or more megabits per second—perhaps as much as 1 gigabit if "optical wireless" technology comes on stream—is not only a matter of degree. Greater connectivity also enhances the user's online experience as well as paving the way for the delivery of new and improved services.
It is all the more regrettable therefore that there is a whiff of incompetence about the way the roll out of broadband has been managed. The White Paper states that,We … wish to move quickly on developing our proposals".It also states:We want the UK to have levels of access to the communications infrastructures of the new economy that match or exceed the best in the world".1228 Three months on, far from moving quickly and far from,levels of access … that match or exceed the best in the world",we have instead a further publication from the Government: UK online: the broadband future. This replaces the wishful thinking of the White Paper with a more tentative approach. It sets a new goal for the UK; namely,to have the most extensive and competitive broadband market in the G7 by 2005".However, it also concedes:Some areas of the country may remain unserved at the least for many years, and some segments of the population may be unable to afford services".In effect, the Government are content to institutionalise digital divides.
That admission contrasts starkly with the honeyed words of the White Paper, which says:We must avoid the creation of communications ghettos, areas of the country or groups in society without access to new net works and services".It also says:All our citizens should have access to the advantages and opportunities provided by the next generation of communications technologies".I highlight only two other issues, which I hope that the Minister will address. First, local loop unbundling, if not an unmitigated disaster, has been somewhat of a mess to date. Quite apart from the threat of legal action against BT by AOL and Freeserve, I understand that the European Commission is contemplating an investigation into Oftel's failure to move the process forward. What assurances can the Government give that the muddle of recent months is being replaced with a more coherent and effective strategy?
Secondly, unmetered access is crucial for the affordability of the new technology, but, inexplicably, I find no reference to it in the White Paper or the UK Online publication. Can the Minister explain why not?
In conclusion, I make the obvious point that actions speak louder than words. For all the soothing rhetoric in the White Paper about promoting the knowledge economy, the Government's approach to broadband is timid at best. Worse, they have introduced a burgeoning list of constraints and disincentives on the industry. There are the delights of the infamous IR35 and the Regulation of Investigatory Powers Act 2000. Even in the current Session, the Tobacco Advertising Bill raises the ugly prospect of ISPs being statutorily defined as publishers. Those are bad enough individually, but their cumulative effect will undermine rather than promote the knowledge economy in the UK. Surely that is not what the Government want.
§ 5.52 p.m.
§ Lord Thomson of Monifieth
My Lords, I join others in thanking the noble Lord, Lord Gordon of Strathblane, for introducing this debate on a matter on which he speaks with unique experience, particularly in relation to radio. I declare two interests. First, I am 1229 a former chairman of the IBA—the predecessor of the ITC, which is itself about to be abolished. Secondly, my daughter is a member of the staff of the BBC.
In many ways, the White Paper is as significant and mould-breaking as the White Paper of 1952, which ended the BBC's monopoly and created ITV. Then, setting up one new broadcasting body produced a storm of controversy. Today, the abolition of five worthy regulatory bodies and their replacement with a super-regulator, OFCOM, commands an agnostic acquiescence—I think that the noble Lord, Lord Gordon, got the word right—if not a positive enthusiasm, but there is not uncritical agreement. The British Board of Film Classification, which is an independent non-governmental body with no public funds, tells me that it is about to be handed over in one way or another to OFCOM with no formal consultation. The Government might look into that. OFCOM is regarded by many with some resignation as the necessary consequence of the removal of the traditional frontiers between telecommunications and broadcasting.
I welcome the White Paper's robust reassertion of the importance of public service broadcasting as an essential contributor to the quality of life in our society. I particularly welcome the unequivocal statement that there should be no privatisation of Channel 4. If the Secretary of State's aspirations in paragraph 5.2.6 are to be fulfilled, it will be vital to avoid OFCOM being unduly monolithic and having too narrow a focus. The thrust of technology, the pressures of competition and the Treasury's appetite for cashing in on selling the spectrum must be balanced by the presence of senior people in OFCOM who understand the importance of, for example, original programming or the regional dimension of public service television and its other values. As the noble Lord, Lord Gordon, said, there will be a need to create a radio division of OFCOM capable of ensuring that the development of digital radio is not overshadowed by the warring giants of ITV.
The proposal to preserve the BBC's special position is criticised understandably by its competitors in ITV and less understandably by the Consumers' Association. Admittedly, it is an untidy and not entirely logical proposal, but tidiness is not everything. The BBC, warts and all, has always been the benchmark by which the best of commercial broadcasting judges itself. Living with, and in some ways within, OFCOM will place a heavy responsibility on the BBC governors. They should welcome OFCOM's overview of the BBC's more commercial practices, because it will give them the benefit of an independent transparent judgment and free them to be the single-minded guardians of the values and duties of public service broadcasting in a way that is not possible for OFCOM.
Under the new White Paper regime, the BBC, and above all its governors, will stand to be judged by how far they fulfil the famous dictum of the distinguished 1230 BBC broadcaster Huw Weldon that the BBC's role is to make good programmes popular and popular programmes good.
§ 5.56 p.m.
§ Lord St John of Bletso
My Lords, I join in the congratulations to the noble Lord, Lord Gordon of Strathblane, on introducing the debate. I warmly welcome the White Paper. I have been particularly impressed by the extent to which the Department of Trade and Industry and the Department for Culture, Media and Sport have worked so effectively together on the consultation.
I shall devote my few minutes to chapter 3 of the White Paper, and specifically the proposal to provide universal access to the Internet by 2005. Fortunately, much of what I had intended to say has already been said by the noble Earl, Lord Northesk.
I declare an interest as the managing director of a NASDAQ-listed Internet service provider. My principal concern is the extent to which Internet access will be provided to every home. The Government need to explain precisely what is intended by universal access to the Internet by 2005. Does it mean access at home or broadband access by schools, libraries, colleges and universities? Progress on increasing the levels of home Internet penetration has unfortunately been very slow. Broadband rollout and even access to ADSL is pitifully slow. I noted the admission of the Secretary of State for Culture, Media and Sport, Chris Smith, in the Financial Times on 12th February, where he was quoted as saying:We want Internet access for all by 2005 but that won't necessarily, even in a perfect world, mean broadband access for all".Those who have access from home are far more likely to use online services more. I commend the work of Citizens Online, which is committed to promoting universal access to the Internet from homes. Its first report aptly addressed the problem, saying:Children are often unable to leave home in the evening to access public terminals or access points and people in rural areas face much longer journeys than do city dwellers in an attempt to get access to public terminals.The Government rely heavily on the platform of digital television as a significant point of access to the Internet. It is essential that the digital TV service providers allow unfettered access to the whole web, not just to commercial walled gardens.
Another major challenge is the need to educate and to change the mindset of many people towards using the Internet. I believe that in that respect the Government should be commended for their achievement of already setting up more than 600 online service centres across the United Kingdom. I understand that they are committed to opening a total of 6,000 on-line centres by next year. I do not know how they will achieve that; nevertheless, that is one of their targets.
Finally, can the Minister tell the House how much, if any, of the £21 billion that they received from the 3G licence auctions last year has been reinvested 1231 into high-speed, broad-band infrastructure? I would countenance a guess that if that sum had been invested in broad-band infrastructure across the United Kingdom, effectively it would have connected every home to broad-band access. Have the Government considered setting up a universal Internet access service fund to prime-pump new initiatives and to offer incentives to the commercial service providers to provide access to homes where it is not commercially viable?
My time is up. I look forward to the Bill being introduced into your Lordships' House.
§ 6.1 p.m.
§ Lord Bragg
My Lords, I, too, congratulate my noble friend Lord Gordon of Strathblane on introducing this debate. I have an interest to declare. I am employed by Granada Television. I am also employed as a freelancer by BBC Radio. Perhaps the two cancel each other out.
No one in this country can avoid the BBC in a debate of this kind. Not only does it control 40 per cent of television viewing and 50 per cent of radio listening, it still dominates the culture which it used to monopolise. At the moment, it seems to me to be in a mood to enter another golden age. The five national radio channels are flying; the World Service is still deeply effective; and its television twins, BBC1 and BBC2, are being primed with new money and enthused with new ambitions by the new director-general, Greg Dyke, whose first year has seen a BBC turnaround on a scale few would have predicted.
However, the BBC casts a very long shadow. It could be argued that its publicly funded power, size and competitiveness both make and mar—even distort—our mass communications systems, making it extremely difficult for ITV companies to grow in any way that is comparable to fellow commercial outfits in Europe and the US. Yet, without the BBC, our country's broadcasting is unthinkable. It is a serious dilemma.
ITV attracts an up-market audience of 48 million viewers a week, invests more in UK home-made productions than any other channel in Europe, including BBC1, and has 27 regional news services across the UK—twice the number of those on the BBC's two main channels combined. We have a massively-watched public service commercial channel, the like of which exists nowhere else on the planet. Therefore, why is it so neglected in this White Paper?
Big organisations can be neglected, too. And have not we seen the consequences of that over the past few years? There persists in radio and television the belief that what is good is not commercial and, therefore, what is commercial cannot be really good. We would consider that to be nonsense if it were applied to David Hockney, Pavarotti or Mercedes-Benz. However, here the commercial is still a taint, even though the work that it sustains, and, for that matter, some of the commercials themselves, can be a triumph.
This Government have tackled many broadcasting issues here and elsewhere with skill and sympathy but not, alas, with enough of either in the case of ITV. For 1232 example, in the case of the digital switch, firm and immediate guidance is needed now. That would encourage manufacturers to promote digital equipment and would hasten the day when the analogue channels become available for an Exchequer set to benefit from both. Again, ITV agrees that it should be available on all delivery platforms—terrestrial, cable and satellite. But if ITV must offer that, surely those systems, including satellite, must carry. Why ever not? Without such fair dealing, the satellites will be in the driving seat in all negotiations, as my noble friend Lord Gordon of Strathblane pointed out.
Moreover, surely it is time to repeal the rules which prevent any one company owning more than 20 per cent of ITN's news service. No other substantial broadcaster in the world is denied the opportunity to own its own news supplier. And what of the absurd rules governing independents? Once again, while ITV must take 25 per cent of independents, the restriction on its own classification as independent and its own investment in independents is subject to unfair discrimination.
Finally, why is OFCOM responsible for regulating content on all channels, save the giant BBC? It is as if Oftel were not to regulate BT. That w ill only exacerbate unfairness and archaic favouritism. There is no suggestion that the BBC's board of governors be disbanded, but surely those governors, too, can see that their future best lies within rather than without, especially as an over-privileged BBC will cause unnecessary friction and, worst of all, I believe, backfire on the BBC itself.
In my view, ITV's needs have been ignored for far too long, its ambitions discounted and its potential marginalised. Surely now is the time to give ITV, which is a valuable national and regional asset, the means that it needs to add fully to the wealth of the nation.
§ 6.5 p.m.
§ The Lord Bishop of Lichfield
My Lords, I also thank the noble Lord, Lord Gordon, for introducing this debate. First, across the range of exciting developments in communications, I understand that technological convergence is an important happening. Whether the context is telephony, the Internet or broadcasting, technological convergence is taking place.
Secondly, I understand that convergence is clearly accelerating the pace of change. In that context, time seems to be of the essence. However, I want to concentrate particularly on a matter of importance in relation to where I live—the issue of access. Who will have access to these new opportunities? My own Midlands diocese embraces such places as Walsall, Wolverhampton, the Black Country and Stoke-on-Trent, but also Shrewsbury, Oswestry and remote places on the Welsh Border.
At this time of the foot-and-mouth crisis, what are those remote Border farmers in need of? They need information. They need information which gives help 1233 and hope and they need it quickly. I am encouraged by the Government's help to urban areas in my own diocese—the Walsalls, the Blakenhalls and the Tiptons. However, if those places, particularly on the educational front, also miss out on access to communication, the consequences could be serious.
As a previous speaker has already said, this White Paper sets the goal of universal access to the Internet by 2005. I note that it has also promised 100,000 computers at low rent. Clearly, the task is great. However, the Government speak of promoting that access rather than trying to ensure it. Should not work be done to monitor the effect of non-provision on people and communities or on sectors of society which are at risk?
I submit that access is a vital issue, whether in relation to the Internet, to telephony or to digital broadcasting. Therefore, I submit—I believe that here I am in agreement with the noble Lord, Lord Gordon—that a strong regulatory presence may be required to ensure that communications deliver their potential to all members of our community.
I end with a punch-line. I have heard it said that sophisticated communications networks can shrink the globe. What a pity if, through the gravitational pull of profitability or the lack of political will, they succeed only in shrinking the inside of the M25.
§ 6.8 p.m.
§ Baroness Wilkins
My Lords, I add my thanks to my noble friend Lord Gordon of Strathblane for introducing this debate. It provides a timely opportunity to consider how the proposed new framework can deliver full and equal access to the communications revolution for the UK's 2 million visually-impaired people.
The White Paper acknowledges that access to communications services often poses particular difficulties for disabled people, even though such services may be more important to them than to the population at large. It states:We will want to ensure that as many as possible are able to benefit".However, current plans for reform simply do not spell out how that is to be achieved. There is apparently no provision for ensuring universal access for disabled people through primary legislation or strong licensing conditions. The duties of the new regulator in relation to disabled people appear weak. A consumer panel is proposed without any reference to how disabled people's interests are to be represented within it, and the willingness and ability of new media industries to self-regulate is grossly overestimated.
As matters stand, neither digital TV, digital radio, mobile phones or websites are accessible to blind and partially-sighted people. They are excluded from those proliferating technologies because of poor design, the extra cost or technical difficulty of access, the absence of suitable equipment and the lack of training. Yet all 1234 of those services could be available for use if they included basic inclusive design features that magnify text or provide an audio alternative.
The industry has shown itself to be unwilling to make a small but fundamental investment in inclusive design and it is showing no signs whatsoever of developing the universal access standards that the White Paper calls for. Every time a new generation of equipment is produced that is not accessible, the longer it takes and the more expensive it is to rectify the situation. There is nothing in the White Paper to suggest that the Government plan to enforce universal access through licence conditions or that the back-stop powers of OFCOM will be deployed swiftly or strongly enough to make a difference.
One of the most critical issues for blind or partially sighted people today is, of course, access to digital TV. For more than a decade, the RNIB and others have campaigned for audio description on TV. That is an additional narration that fits "between" dialogue and describes action, body language, facial expressions and anything else that helps people to follow what is happening. While broadcasters on digital terrestrial TV are currently required by law to have 10 per cent of programmes with audio description within the first 10 years of their licence, there is currently no way for visually impaired people to access those programmes because they lack the necessary equipment.
Broadcasters and the voluntary sector have invested in developing a prototype of the necessary technology to show that audio description can work, but no broadcaster or manufacturer is willing to fund production of the equipment for public use. Why, then, are the Government refusing to ensure that a statutory right to have public broadcast programmes televised with audio description is matched by a statutory right to have equipment that can receive audio-description? The RNIB and the digital network have requested governmental intervention to underwrite the costs. Without such support, the whole project will founder. However, the Government have thus far said no. Moreover, they say that they will not countenance raising the audio-description targets on broadcasters until the RNIB and broadcasters sort out the production of the module between themselves. It cannot be right to leave access to such core services either to the market or a charity. If the Government are truly to honour their commitment in the White Paper to,extend and improve provision for … audio description'",they must take action.
In the brave new communications future it appears that sighted people will have the opportunity to, for example, vote online, receive vital health information and access new educational opportunities through interactive digital TV. However, blind or partially sighted people may not have such opportunities.
It cannot be the Government's intention that the digital communications revolution should exclude blind or partially sighted people in that way. There is still time to ensure that A New Future For Communications urgently addresses their needs. We must all hope that the opportunity is seized.
§ 6.13 p.m.
§ Lord Mitchell
My Lords, I, too, am delighted that my noble friend Lord Gordon introduced this debate. I congratulate the Government on publishing the White Paper primarily because it is very reassuring to see a government for once dealing with a future technology in such a proactive way.
I am not a broadcaster and I have no history in the broadcasting media. My background is in information technology and in consequence I probably view the White Paper with somewhat different eyes from those of many other noble Lords. From my perspective it seems that information technology and the Internet have been added to the White Paper somewhat as an afterthought.
I would like to state the obvious: that the Internet is not the same as broadcasting and that it has to be treated differently. Indeed, in a few years' time, when broadband will be universal, much more content will be available over the Internet than is available today on television.
I turn to a subject that I know worries Members of the House; that is, access to unsuitable material and pornography. Three weeks ago I was telephoned by a friend of mine, who suggested that I should take a look at a programme on Channel 5 called the Ricki Lake show. I turned on my television and was horrified to see a young American man extolling the virtues of pimping. His line was simple: that pimping was a fine profession and that it made him lots of money. Perhaps that is simply the world we live in. However, I venture that noble Lords will be as shocked as I was when I relate that I viewed that programme at 9.20 on a Friday morning. I had thought that there was a watershed relating to such programmes but clearly I am wrong. I am aghast that Channel 5 allowed that programme to appear on daytime television.
Noble Lords may be interested to know that I complained to the Independent Television Commission in writing and on House of Lords writing paper. I have received a n acknowledgement, but as yet no answer. Noble Lords may also be interested to know that someone else I know, who does not have a title, telephoned the ITC to complain, only to be fobbed off with the comment that that is the way that television is going these days. Finally, noble Lords may be even more interested to know that I also telephoned Channel 5 but, predictably, my call is yet to be returned. The conclusion is obvious—nobody gives a damn; all that matters is ratings.
However, all of that is sweetness and light compared with what is available on the Internet. Within one minute of leaving your Lordships' House, any noble Lord could be sitting in front of a computer in the Library and could have accessed the homepage of any number of highly offensive websites. Little skill is needed. One simply has to enter, "www.", followed by any expletive that one likes, and then ".com". An immediate connection will be made to a hardcore porn site that is located who knows where on this planet. One will see people engaged in all types of sexual activity. As noble Lords will have read, the material is 1236 not confined simply to adults; children too are featured. When broadband arrives those activities will become more immediate and infinitely more graphic.
If such material can be accessed in the Library of your Lordships' House it can equally be accessed by an eight-year-old child left unsupervised in front of a home computer. Soon there will be pornographic video on demand, in full Technicolor, in Dolby sound and "in your very own home". The Internet is so simple to use that it is no exaggeration to say that everyone can learn to tap into it very quickly and without hindrance. The Internet permits ludicrously easy access in a matter of seconds to the most hardcore, violent and perverted pornography. How can any child deal with that? How can any child know what he is letting himself in for when he gets together with a few friends after school to look up something naughty on the net?
To our children the Internet should be viewed as a wonderful window on to the world, a fantastic learning tool and a superb way of communicating. But when it offers easy access into depravity we should all be on our guard. It is our duty to ensure that our children are protected. I hope that OFCOM can step up to the challenge.
§ 6.18 p.m.
§ Lord Holme of Cheltenham
My Lords, I should like to take four minutes—I thank the noble Lord, Lord Gordon, for giving me the opportunity to do so—to make four points about the White Paper. I do so as someone who believes that convergence is coming and that the White Paper therefore points in the right direction.
My first point is about the composition and processes of OFCOM. It must be a new body that is fit for its ambitious role, it must be open, transparent and accountable in its processes and it must have executive and non-executive directors and functions and structures that are purpose made. Any attempt to create OFCOM simply by bolting together the ITC and Oftel would be wrong because they are very different bodies. Both have distinguished histories. But they were created for entirely different purposes. Of course we must draw on their strengths and people, as we must draw on other regulatory bodies' strengths and people. May we have an assurance from the Minister that OFCOM is a start-up and not a merger?
Secondly, I emphasise the extent to which wise, light-touch regulation should draw on research into people's attitudes and patterns of behaviour in relation to broadcasting. Research is an indispensable part of the wise judgment that will certainly be required. Powerful experience is now available through the broadcasting regulators, principally but not exclusively through the Broadcasting Standards Commission. May we have an assurance from the Minister—I know that research is a subject that is close to his heart—that that experience will be built on and reinforced in the new structure?
Thirdly, we must accept that competition should be the main route to the satisfaction of viewers, listeners and telecom users. Of course, one enemy of 1237 competition is excessive regulation; the other is abuse of dominant market position. I, for one, find the White Paper rather coy on the question of cross-media ownership. We need competition, and we need plurality of voice. Some competition may lead to the sort of concentration the noble Lord, Lord Gordon, described. But when it comes to cross-media ownership, over-dominant share of voice becomes the issue—an issue which is social, economic and political. Perhaps it is unreasonable to expect the Government to be too brave on this issue in the run-up to an election. But afterwards is another matter. Let us hope that the Bill does not shirk this issue in the way that I fear the White Paper does.
Finally, what of the BBC? The BBC remains at the heart of the British communications kaleidoscope, not least as a benchmark of quality which still distinguishes British broadcasting from so much of the rest of the world. But we need a focused and accountable BBC with defined and specific public service objectives; not a beanstalk growing and proliferating in every direction, trying to fill every nook and cranny of the media market. It should be a BBC wholly within the scope of OFCOM, not half in and half out as it is in the White Paper, perhaps with governors still responsible for internal quality control and good governance, but securely protected from random, short-term political interference from politicians of all colours. That is one of the paradoxes of the White Paper; that it opens the BBC to political interference from which it can only be protected by being part of the complementary regulatory structure. I fear that that issue too has been shirked in the White Paper and I hope that the Bill will do better.
§ 6.22 p.m.
§ Lord Dubs
My Lords, I, too, thank my noble friend Lord Gordon for making this debate possible. I declare an interest in that earlier this month I became chair of the Broadcasting Standards Commission, having previously been deputy chair of the Independent Television Commission, though clearly the views I put forward are entirely my own. I am delighted to follow the noble Lord, Lord Holme, who was my predecessor at the Broadcasting Standards Commission and I pay tribute to his work and indeed that of his predecessors in the chair.
The Broadcasting Standards Commission, together with its predecessor body the Broadcasting Standards Council, set standards in this country for openness and transparency in dealing with standards and complaints, linked to high quality research—qualities which I hope will be carried fully into the new OFCOM procedures.
I welcome the idea of OFCOM as a merger of the five regulatory bodies. It will be a welcome end to the double jeopardy that now exists for broadcasters—indeed, sometimes triple jeopardy when there are complaints about their work. And I welcome the idea of a light regulatory touch over our broadcasting. However, I have a number of comments to make on the content of the White Paper.
1238 First, I hope that the new OFCOM will have proper representation of non-executive board members in order to fully represent consumers and citizens. Secondly, I hope that OFCOM will be fully accountable as a body. Indeed, it ought to come under the National Audit Bureau just to add another layer of oversight and accountability.
I hope that the good work on content, which was carried out by the Broadcasting Standards Commission and the Broadcasting Standards Council before it over recent years, will not be lost in the larger OFCOM structure. It is therefore proper that within OFCOM there should be a content committee, also including one or more non-executive board members, in order to ensure that acceptable television standards are maintained. I am pleased that the phrase, "acceptable standards" will replace the words, "taste and decency".
I trust also that the new OFCOM will be robust in defending the concept of public service broadcasting, a concept which has made British television the best in the world and made us unique as a country in providing television. I am disappointed that so far it appears the BBC will not come fully under the new regulatory structure. The danger is that it means that either the Government or Parliament will have to act in an oversight capacity over the BBC if the governors do not meet the need, which they may not always do. That may bring the BBC, as the noble Lord, Lord Holme, said, into possible conflict with the Government.
If I were a BBC governor, I would argue passionately that it is in the interests of the independence and integrity of the BBC that it should come fully under the new OFCOM structure. That will be desirable given the complexity of the White Paper and the likely complexity of the Bill to follow. If the Government were to publish a draft Bill, it would enable Parliament to exercise pre-legislative scrutiny, which would result in a better Bill in due course.
Lastly, it is right that OFCOM should deal with content problems post delivery. I am a little concerned at the suggestion that the role of classification should be given to OFCOM. That is probably not the best way forward, even though OFCOM may have a duty to consider complaints about classification itself. Having said that, I believe the White Paper represents a good way forward and if the Government listen to the criticisms, we will have an even better broadcasting structure in the end.
§ 6.26 p.m.
§ Lord Haskel
My Lords, I have no special interest to declare. I am just an ordinary consumer strongly in favour of broadcasting, and I am grateful to my noble friend Lord Gordon for this opportunity to tell your Lordships the reasons why.
Public service broadcasting makes a special and distinct contribution to the sense we have of being a nation. That is why I am a supporter of public service broadcasting. By that I do not mean warm beer and cricket on the village green, or church bells across the 1239 meadow; I mean that it reflects the whole variety of different regions, different ethnic backgrounds and different cultures of our urban, rural and suburban life. Television and radio bring us the whole mixture of life that makes up our society today.
But the advantages of public sector broadcasting do not end there. News and current affairs, based on a high standard of journalistic integrity, feed our democracy. Public service broadcasting backs up our education system with such things as the Open University, the National Grid for Learning and the University for Industry. It provides us with entertainment and cultural activity, not only making the good popular and the popular good, but also nourishing us with cultural activity in which we can all share. In addition, public service broadcasting can provide a showcase for creativity and talent which helps the economy, particularly the creative economy.
Of course, broadcasters other than the BBC can provide that. Thanks to our system of regulation, all broadcasters in this country have to provide an element of public service. Public service broadcasting is not just there to provide what the market will not or cannot provide. The communications White Paper recognises that. That is why I am generally in favour of its recommendations.
But central to that is the way in which media technologies are converging. As all the broadcasting media come together, will we be able to maintain the public service ethos which I find so beneficial to our society? I hope so.
In the White Paper the Government clearly state that public service is an objective. Regulation and controlling ownership are their means of achieving that. For there are obvious dangers from concentrating media ownership in a few hands. I saw a quotation the other day from Gerald Levene of America On line. He is reported to have said:The global media is becoming more important than Government, than NGOs, than the educational institutions".I find that rather chilling and worrying. Neither am I persuaded that the proliferation of services in the media markets means there is any less need for regulation. There may be more competition but the public interest remains to be defended.
To get that right, we need a lot more debate to hear what ordinary consumers have to say, because the experts sometimes get it wrong. For instance, they certainly got wrong our anxiety to shop over the Internet; they obviously grossly overestimated that. But one thing seems certain; that is, that the development of public service broadcasting partly lies in what Steve Morrison of Granada has referred to as the broadcasting of public services. By that he means programmes such as homework and revision TV channels; a televised health advisory service; a citizens advice bureau of the air, and help with pensions and social security matters. With interactivity, all those are likely to become an important part of public service broadcasting.
At a seminar on digital citizenship last year, my right honourable friend Chris Smith gave a vision of the future of broadcasting that I rather like. He saw the 1240 multichannel, online, multitechnology broadcasting world as a public library of the airwaves, which would inform, entertain, educate, challenge and unite us. I hope that his vision becomes a reality.
§ 6.31 p.m.
§ Baroness Greengross
My Lords, I too welcome the White Paper and thank the noble Lord, Lord Gordon, for the opportunity to debate it. However, there are real concerns that the White Paper gives far too much power to broadcasters to determine their own priorities with little or no emphasis on broadcasting's responsibility to its audiences both as consumers and as citizens. We want artistic and dramatic freedom and creativity, but it has to be balanced with responsibilities which public sector broadcasting gives, and that must have the utmost importance.
Perhaps what is needed is a clear definition of public sector broadcasting which is enshrined in legislation. That would give greater reassurance to many viewers and listeners, which self-regulation cannot. The organisation Public Voice brings together many bodies which focus on public sector broadcasting. It feels that the current consumer panel should have its remit extended or, if not, that it should be supplemented by a citizenship panel which could monitor broadcasting's performance and ensure that it contains a sufficient mix of educational, social action and children's programmes to reflect the multiple interests of our society today.
When the rules were relaxed in 1990, the amount of public sector broadcasting rapidly diminished. There is evidence that certain groups are very much underrepresented. Their voices are not heard sufficiently. They are not visible enough to ensure that through that sort of broadcasting the diversity of our communities is fully represented. I believe that strengthening is needed before we get too far along the road.
§ 6.33 p.m.
§ Lord Ahmed
My Lords, I too thank the noble Lord, Lord Gordon of Strathblane, for introducing this debate and providing us with the opportunity to discuss this important document.
I begin by congratulating Her Majesty's Government on this excellent White Paper, which is widely welcomed. However, there are a number of issues in relation to ethnic minorities, religious minorities and particularly the Muslim community, on which I should like to concentrate in the next three-and-a-half minutes.
Last week the Home Office Minister, Mike O'Brien, stated:Religious belief is important to many of us. It is the moral code by which many people live their lives. We live in a multicultural society with people of many faiths. To make that society truly equal and inclusive it is vital that we respect the right of others to freedom of thought, conscience and religion—and their right to practise their religion or belief. The Government is alive to concerns among some minority faith communities that they suffer discrimination".1241 There are more than 200 commercial radio stations in the UK and almost none are owned or administered by Muslims. They do not have a comparable right to reply. They remain under-served and underrepresented by almost all media groups. If we are to reflect the multicultural, multi-religious nature of Great Britain, it is important that all ethnic and religious minority groups are part of the mainstream too.
As your Lordships are aware, major pieces of broadcasting legislation come before Parliament only occasionally. It is against that background that 2 million British Muslims will welcome the attention given to "Access Radio" and community broadcasting in the Communications White Paper, A new future for communications. They too would like to see some specific definitions and amendments to make the new media legislation compatible with the Human Rights Act 2000 and EU and other international laws, conventions and treaties.
The right to communicate is a basic human right, which is unfortunately denied to the many minorities in Europe. The Muslim community contributes more than £6 billion to the UK economy every year, yet it has a tiny impact within the media. British Muslims wish to see a strategic approach from the Government to the development and regulation of community access radio and television. Such an approach should be cross-media in nature and grounded in clear public service objectives.
British Muslims have a substantial contribution to make to neighbourhood renewal, equality and social inclusion, local democracy, participation in local decision-making and supporting lifelong learning and access to new information and communication technology. I hope that the Government will establish a community media fund whose purpose will include support for start-up and development costs, operating costs, including social and creative programming, training, learner support costs and research into audience and impact.
The new communications regulator, OFCOM, could adopt a strategic and supportive cross-sector approach to the regulation of all minority media including broad public service requirements where licensing is required and self-regulation where appropriate. There is a case for OFCOM to hire and retain informed and representative individuals from the minority communities as well as Muslims, at key decision-making levels to create greater representation and participation. I should be obliged if my noble friend the Minister in his reply could tell us whether OFCOM will have regional offices and what efforts will be made to consult with all the communities throughout the regions.
Finally, I should like to draw to the attention of your Lordships the many organisations which have made representations and written about the White Paper including Access Media Alliance and others. I hope that the Government will take note of their views and ensure that all sections of our community are fairly represented.
§ 6.38 p.m.
§ Lord Merlyn-Rees
My Lords, I, too, commend the noble Lord, Lord Gordon, on having the ingenuity to raise this debate. It is the House of Lords at its best. On other occasions when we imitate the other place, we are not very good. Debates of this nature are very good and worth listening to. I commend the Government for publishing a White Paper which is their response to a new communications environment.
I notice in the introduction that the Government wish to restore the balance between basic standards of decency and quality. That prompted me to say a word about the video industry. For nine or 10 years I have been chairman of the Video Standards Council. It is not generally known how important the video industry is. We are taken by what happens on the Internet, quite properly; it is a new departure and is important. But the video industry serves the 89 per cent of households in this country which own a video recorder, and the number is still growing. The industry sold 96 million videos in 1999. It rents 3.5 million videos each week and generates £1.2 billion from video sales. It employs over 38,000 people. It has paid £2 million in VAT and generated considerable revenues for investment. It is a substantial part of the entertainment industry. Not much is said about it in this White Paper.
For historical reasons, the UK video industry is the responsibility of the sentencing and offences unit of the Home Office. The White Paper introduces OFCOM and so forth, the implication being that the responsibility for videos will remain with the sentencing and offences unit. But the reason for the introduction of the Video Recording Act 1984 was the dirty videos and the like.
The situation is different today because there is an anomaly. When the Government talk about OFCOM and so forth, it is important that they consider putting the regulation of videos under the same regulating department; the Departure for Culture, Media and Sport. It cannot be divided between the two bodies. The British Board of Film Classification should remain. I have every confidence in it. It has done a good job over the years and a very good job for the video industry. It is important that we consider the structures of government, which is my purpose in speaking tonight.
§ 6.41 p.m.
§ The Lord Bishop of Wakefield
My Lords, I, too, am grateful to the noble Lord, Lord Gordon of Strathblane, for securing tonight's debate. I congratulate the Government on the White Paper. It is an excellent start and I hope that there will be opportunities for further consultation and more detailed clarification before the appropriate legislation is brought forward.
In the formal response to the White Paper submitted in my name from the Church of England's Communications Unit, we warmly welcome the Government's emphasis on public service broadcasting. It is a beguiling argument that in a multi-channel world neither religious programmes nor 1243 any other category should have protected status; or that they should be narrow-cast into a digital ghetto. So it is good to see that countered in the Government's firmly expressed aim that public service broadcasting will have potentially an even more important role. And I welcome the commitment to secure the carriage of public service channels on cable and satellite and that these will be given due prominence in electronic programme guides.
Not only religious programmes but also educational, children's and other strands and genres which contribute to our high international reputation would fall by the wayside if left to commercial imperatives. Indeed, I have some worry with the paper's proposal that ITV companies will continue as the main commercial provider withless prescriptive detailed regulation".Does that mean that there will be no indication of how much religious and other public service broadcasting will be required? I assure the noble Lord, Lord Ahmed, that by "religious" I mean not only Christian but other faiths, too.
The White Paper sets out only one justification for public service broadcasting; namely, that it works. I venture to suggest that the reason it works is because of the kind of pressures broadcasters face: the lowest common denominator; competitiveness; and the power of what is appealing rather than what is important. Such matters are currently held more or less in check.
But even with its interesting proposals for a light three-tier structure, the White Paper is a little short on detail about how such vital tempering and balancing is to be sustained. How will the various elements of public service broadcasting be measured? To relax regulation without putting in its place a clear and measurable strategy seems to be a strange way of strengthening public service broadcasting. I suggest that more needs to be done to ensure that each genre within the public service broadcasting responsibility is properly defended as part of the mainstream. We need more detail on that.
If the Government are sincere—as I believe they are—in their reiteration of public service values in broadcasting, they have to look beyond the technical enhancements of increased choice. As the noble Lord, Lord Gordon, indicated, we have an understandable tendency to be seduced by technical progress. But new technologies are simply means of distribution. They do not of themselves make the end product any better.
An essential test of the new arrangements will be that they deliver in terms of content. So do the Government believe that the mechanism for regulation in the White Paper will be sufficiently robust? There is much to be said for the more unified approach. However, like the noble Lords, Lord Bragg and Lord Dubs, I believe that OFCOM's remit should include the BBC because in order to be effective regulation needs to be distant from production.
How effectively will the proposed new arrangements deal with matters which violate generally accepted standards of taste and decency? As the noble Lord, 1244 Lord Mitchell, demonstrated, these concerns are by no means confined to a small cranky group of the disgusted. There are legitimate and public protests about offensive broadcasts, videos and the Internet. The White Paper begins to address them and I hope that the Government will take the issue very seriously indeed.
§ 6.45 p.m.
§ Lord Borrie
My Lords, the topic on which I want to touch is the regulation of advertising, considered in Chapter 6 of the White Paper. I declare an interest as chairman of the Advertising Standards Authority. Because I took up the office only on 1st January, I can happily welcome the favourable comment about the authority in the White Paper without appearing to boast. Indeed, I can at the same time pay tribute to the work of my predecessor, the noble Lord, Lord Rodgers of Quarry Bank, and to the council and staff of the authority for improving the processes and efficiency of the ASA in recent years while maintaining its independence both of government and the industry.
The ASA currently regulates not only advertising in all the print media but also in the cinema, on videos and on the Internet. The White Paper proposes that the new regulatory body, OFCOM, should have the principal responsibility for regulating advertising in the broadcast media, taking over the responsibilities currently held by the ITC and the Radio Authority, but states—and this is of importance—that OFCOM could authorise the broadcasting or advertising industry to run industry-based codes within a co-regulatory system whereby OFCOM would set the framework and the industry could be left to draft detailed rules and take responsibility for implementation and enforcement. The White Paper states:The strengths and effectiveness of the Advertising Standards Authority (ASA) system for self-regulation of non-broadcast media, which is well-regarded both here and overseas, gives us confidence that a more co-regulatory approach than the present could be effective".Fast moving changes in technology and its application mean that old distinctions have become problematic. There is much convergence between what is regulated as broadcast advertising and what is regulated as non-broadcast advertising. Video advertisements appear on buses, in taxis and on the Heathrow Express. We have moving pictures in Internet advertising. All those look like television advertising and it is difficult to discern the distinction between broadcast and non-broadcast electronic advertising, particularly when the Internet can be accessed on a television screen and television can be viewed on a personal computer. I need hardly say that modern advertising is no respecter of the division between broadcast and non-broadcast. And global brands expect to advertise on all platforms.
The legislation that is envisaged should allow sufficient flexibility for OFCOM, the ASA and any new co- regulatory arrangements to operate effectively in a rapidly changing scene. But there needs to be in 1245 place a mechanism to ensure consistency of standards and in decision-making and to enable consumers to know where they should go.
Inevitably, I suppose that the legislation will be complex and lengthy. Because my noble friend Lord McIntosh recalls the complexity and length of the Financial Services and Markets Act, which he took through the House, he might like to recall the warning of Sir Howard Davies, chairman of the Financial Services Authority. He said:Having a Bill in Parliament is like having a skip in front of your house: other people put their rubbish in before you have a chance to fill it with your own".
§ 6.50 p.m.
§ Lord Lipsey
My Lords, I spent many hours on the Davies committee considering the BBC with my noble friend Lord Gordon of Strathblane. Therefore, I particularly welcome this opportunity to debate these matters with him tonight. He was rather more successful: one of his recommendations was accepted by the Government. None of mine was. That is what committees of inquiry are like.
I rise to make just one concrete suggestion following the remarks of my noble friends Lord Dubs and Lord Borrie. When I look at the White Paper and the Bill that is to follow it I have a powerful sense of défà vu. This is very much like the Financial Services and Markets Bill in which some of us were closely involved last year. We have a situation in which the existing system of regulation no longer matches modern reality. The subject is fantastically complicated in its detail. I see the noble Baroness, Lady Miller, nodding. The subject is also absolutely non-partisan. We have a situation in which four or five regulators are to be merged into one. We hope that that will be done from the bottom up and that they will not all be shovelled into the same pot. We also have disciplinary systems with serious implications for human rights legislation.
The Financial Services and Markets Bill was referred to a Joint Committee of both Houses of Parliament chaired by the noble Lord, Lord Burns. Had it not been for the work of that committee the Bill would have been completely unworkable. We had enough trouble with the Bill when it emerged, but without that work it would have been unworkable and probably would have offended against human rights legislation. The simple suggestion that I make tonight, which has also been made by the all-party media committee, is that the Bill be referred to such a committee. I believe that all the more strongly because, from what I hear of the drafting process—I make no criticism of it—the clauses are being shovelled to the draftsman so that the Bill is ready as soon as possible in the new Session. No doubt the best job is being made of it by the best possible people, but I shall be surprised if they come up with a flawless Bill.
Here we have an opportunity to use that method to consider the Bill before it is passed. It has been used only once since the Financial Services and Markets Bill, but clearly that is how we should proceed with the Bill before it is considered in detail in both Houses so 1246 that we arrive at a correct piece of legislation that lasts for the decade of revolutionary change which lies ahead of the broadcasting industry.
§ 6.53 p.m.
§ Lord Addington
My Lords, I thank the noble Lord, Lord Gordon, for introducing this debate. I should like to address my remarks primarily to the subject of disabled users of the broadcast media. I believe that over 2.5 million people have visual impairment and 8.7 million people have hearing impairment. Traditionally, those groups of people are pushed into ghettos within broadcasting and are dependent on our changing the system to make it more accessible to them. The noble Baroness, Lady Wilkins, has already spoken of the tremendous opportunities for change that are available with the new technological media if the Government are prepared to give a little nudge to ensure that people are better able to gain access.
Public service broadcasting—I believe that all broadcasting should have an element of public service, even if it is only for a minority interest—has been one of the democratising influences in our society, certainly throughout my lifetime. That is beginning to break down with the ability to purchase what one wants. We now have an opportunity to insist that the Government pay greater attention to the new technological possibilities to cater for the 6 or 7 million people who have problems with the media. That may mean stipulating that programmes must be broadcast over particular ranges or that suppliers ensure that new equipment can receive new broadcasts.
Probably the most obvious example is that the BBC believes that it is capable of achieving 100 per cent subtitling. Other terrestrial broadcasters do not believe that that is possible. I welcome the fact that we intend to bring into the system both cable and satellite broadcasting, but surely in the not too distant future we should work towards a system in which all of them are included, especially in view of the fact that many programmes in these other media are recycled from the primary producers. We have been over the subject many times. The estimated cost of providing broadcast subtitling is £400 an hour, which is not a huge cost. I believe that not long ago I and the Minister agreed at Question Time that under the Disability Discrimination Act there was an arguable case for regarding that as a reasonable consideration. I suggest that now is the opportunity for the Government to nudge it further forward.
There are similar requirements, for example in relation to those with hearing problems who use radios. There is the possibility of broadcasting without sound effects, for example on Radio 4, to enable people to pick up the gist of programmes. It is possible that with the emergence of new channels that service will be available. That is the kind of approach which must be looked at in the current environment.
As to the use of telephones, unless we begin to put pressure on providers to ensure that equipment is adapted to enable those with hearing problems to use 1247 them, for example, by building in microphones, and is available at the same cost as ordinary telephones, we shall continue to deny to a large section of our community the use of that basic form of communication. I do not know how many people who use mobile telephones noble Lords have bumped into in the past few weeks. Mobile telephones are here to stay for the foreseeable future. We must begin to apply pressure, and I hope that discussion on progress will allow us to do so.
§ 6.57 p.m.
§ Lord Eatwell
My Lords, I begin by declaring two interests: first, as a non-executive director of Anglia Television; secondly, as chairman of the Commercial Radio Companies Association. The communications White Paper has been generally well received, and quite rightly so. It is a far-sighted document which in general has tackled the issues of technological change, convergence and the future of the communications industry with imagination. Sadly, there is a major exception to that general approbation. The radio industry has reacted with undisguised disappointment. That disappointment is derived both from what the White Paper says and what it does not say.
Part of the radio industry's disappointment derives from the failure of the White Paper to say anything decisive about the future of radio ownership. Concerns about radio ownership arise from the desire to provide listeners with a wide range of choice of high quality programmes. What then is the relationship between diversity of programming and the pattern of ownership?
It is a well known result in economic analysis that having a large number of owners does not provide a wide range of choice. In that case every owner will compete for the largest number of listeners, and the result will be a narrow range of programming as different stations struggle to capture the most popular part of the market, cannibalising each other's markets. It is a small number of owners that will produce greater diversity as stations spread along the spectrum of taste to maximise total listening. The BBC is an excellent example of that; it is a major company which provides a diverse range of programming on its national and local services. Clearly, the Government agree with the argument of my noble friend Lord Gordon that plurality of ownership reduces choice and that a limited number of owners can increase choice, for they have deployed that argument convincingly in the case of television.
The White Paper makes clear that a future in which there are only two companies providing regional television; namely, the BBC and a single ITV company, will not in any way compromise the provision of a diverse local service. Does the Minister agree that the same argument can be applied to radio? The radio industry itself has proposed that in future there should be at least three companies providing radio services in a given locality, the BBC and two commercial companies, hence providing a framework with the plurality necessary to stimulate competition 1248 and the concentration necessary for the provision of a wide choice of programming. Will the Minister this evening endorse that proposal?
I turn now to what the White Paper does say. I believe that the proposal to create OFCOM, a single integrated regulator, is really excellent. A single regulator is necessary if this country is to take full advantage of the opportunities provided by the new technologies. However, the ability of OFC'OM to deliver the Government's goals of diversity, a dynamic market and efficient use of the scarce spectrum, is seriously compromised by the failure to include the BBC within OFCOM's regulatory domain.
Again, it is a well-known result in economics, now the economics of regulation, that if one has more than one regulator of an industry, the result is wasteful duplication, the inefficient utilisation of scarce resources and the consumer being badly served. These were some of the reasons, for example, why the Government quite rightly opted for a single regulator for the whole financial services industry.
In radio, a single regulator could be the guardian of diversity and choice and of the efficient use of the spectrum. A single regulator for radio would be able to ensure that format commitments are kept where appropriate, are adapted where necessary and in either case there is not wasteful duplication. The proposed system of radio regulation in the White Paper, in which OFCOM regulates commercial radio and BBC radio is regulated by the BBC governors, is an economic nonsense and a guaranteed recipe for inefficiency.
As everyone who has spoken on this topic in this debate so far has agreed—namely, the noble Lords, Lord Gordon of Strathblane, Lord Bragg, Lord Holme of Cheltenham, Lord Dubs and the right reverend Prelate the Bishop of Wakefield—the enormous benefits which a single integrated regulator, properly constructed, will bring to broadcasting will be lost if the Government preserve the antiquated anomaly of the BBC being regulated entirely separately. Will the Minister assure the House that the Government will look at this matter again?
The radio industry to keen to work with the Government in transforming the White Paper into a successful Bill. Regrettably, all the major recommendations made by the radio industry in the consultation process preceding the White Paper were ignored. I hope that the Minister can give me an assurance this evening that that will not be the case the second time around.
§ 7.2 p.m.
My Lords, in thanking my noble friend Lord Gordon of Strathblane for having the luck of a Napoleonic general in the ballot and giving your Lordships the chance to debate this White Paper, I was going to say how quickly we seem to be returning to this subject. I then realised that five years have already elapsed since the passage of the Broadcasting Act 1996, a virtual lifetime in a world in which Moore's Law, for instance—the doubling of processing power every 18 months—applies.
1249 That rate of dynamic change lies at the heart of the regulatory challenge. Each of the last Broadcasting Acts has arguably been overtaken by developments in the markets and technology before the ink on the Royal Assent has dried. The proposal to establish OFCOM, therefore, will be judged on the basis of how well and how flexibly, under the legislative framework, it can respond to the rapidly changing environment.
My version of the agnosticism of my noble friend Lord Gordon is to ask whether we really need a concurrent regulator at all, or whether the DTI and OFT could not be responsible for all the commercial and competition issues and another single body responsible for all issues of content and standards. I suspect that, on balance, OFCOM is the right route to go down, but when the legislation is introduced I hope that the argument will be convincingly and clearly made.
In addressing just two other points in my remaining time, I should declare a number of interests as a director of, or venture capital investor in, various companies for which broadband connectivity in particular is of critical importance. In addition, I am a director of a company, Indicii Salus, which is in the forefront of cryptographic security for Internet services.
Universal broadband access is of overwhelming importance to both individual consumers and to businesses, large and small. Our culture and our prosperity alike will be diminished if we fall behind in its provision. There is no doubt that over the past 10 years neither BT nor the cable operators have shown the level of innovation or dynamism that consumers deserve. In the end I believe that the markets will pass judgment, as the board of BT may now be finding, and perhaps as a result we will see the long-needed improvement in commitment and service.
The regulator, as so often, may only be the enforcer of last resort, but Oftel's recent record in sharpening or complementing market forces is deeply disappointing. If, as the White Paper notes,unbundling … in every country, gives rise to disputes between the incumbent operator and its competitorsOftel was as well prepared to handle these disputes, many years after they were apparent in other countries, as Dad's Army would have been for 21st century warfare. I sincerely hope that OFCOM in the future and Oftel in the interim, show greater vision and determination.
The White Paper covers briefly the issue of Internet security and the prevention of on-line fraud. The DTI, over 10 years or more, has been longsighted and energetic in encouraging work and standards in this field. But it is impossible to overstate the importance not only of achieving the highest levels of security for e-commerce and on-line payments, but also of instilling unequivocal confidence in these systems on the part of consumers. Much of that responsibility lies with the private sector whether Internet companies, banks or retailers.
1250 But the Government have a vital role as well. In particular, where the Government have an existing regulatory or supervisory role such as, for example, in the move of the National Lottery to on-line playing, they must surely ensure that the highest levels of security are adopted. Can the Minister say whether he believes that the present regulatory regime, before any new regulation, is adequate in that respect?
§ 7.7 p.m.
§ Baroness Flather
My Lords, I, too, would like to thank the noble Lord, Lord Gordon of Strathblane, for initiating this debate. I would also like to thank him for planting a very important seed, at least in my mind, that technology should not be in the driving seat. I hope that noble Lords will take note of that because I am sure that when the Bill arrives in this House we shall have to bear that in mind. We shall have to make sure that the controlling force is not technology.
I must declare an interest. I am a director of Meridian Broadcasting, which is a regional ITV company. I am also a director of Kiss and Magic, which are independent radio stations. I am very proud of Meridian's record in providing services in the area it serves. I am also very proud of the original way in which it has used its charitable trust to provide programmes on very special subjects, which are mainly disability issues as well as programmes on ageing, carers and all the related matters which affect us. It has followed them up with booklets, information, provided loops and so forth. It is very important that, whatever happens, the regional dimension must be maintained and not be smothered by too much regulation.
I was going to mention one or two names, but there are more than I can quote now. Many noble Lords have already said that the BBC should be fully regulated by OFCOM. The Charter was brought into force at a time when, in their wildest imaginings people would not have envisaged what is happening today. There is no question but that the BBC should be part of the regulatory process. Ultimately, it cannot continue to be judge and jury in its own case. It does not work.
The main issue at the moment is providing a level playing field. There are a number of different aspects. I am talking only about television. Noble Lords have touched on many matters which are beyond my comprehension. With regard to television, there is the BBC, free to air, pay TV and all the ITV companies which have to generate their own revenue to provide programmes. If we provide a level playing field for all these services, they will grow and prosper and we shall have the best of all worlds.
If the ITV companies are penalised when they want digital carriage or when they compete in other forms of carriage, they will not have the money to provide the programmes. We know that ITV companies are providing the programmes and have overtaken the BBC among ABC viewers. That people are watching TV is a most important statement. I am sorry that the noble Lord, Lord Ahmed, is not here; but Channel 4 1251 provides a tremendous number of programmes. It provides programmes on Islam. They are not patronising, which the BBC's programmes so often tend to be.
My time is up. The real point I want to leave with noble Lords is that when we come to debate the Bill we must try to see that there is fair play between the different providers and that they all have the opportunity to grow and do their best for us.
§ 7.12 p.m.
§ Lord McNally
My Lords, last year I had the honour of meeting the world-wide president of Sony. When we were introduced, I said, to break the ice: "You know, sir, I sometimes think that in 10 years' time we will not recognise this industry". With typical Japanese terseness he replied, "Three years". I thought of that when the noble Viscount, Lord Chandos, made a comment about the 1996 Bill. Whenever, over the past 20 years, we have debated broadcasting communications it has been against a realisation that the technology is moving much faster than the parliamentary process.
Nevertheless, like other noble Lords, I welcome and am grateful to the noble Lord, Lord Gordon, for initiating the debate. We have, in this debate perhaps more than in previous debates during the past 20 years, and in the legislation we are looking forward to, an opportunity for setting the parameters and the foundations for our communication system, at least for the earlier parts of the 21st century. That is why I should like first of all to welcome and endorse the call of the noble Lord, Lord Lipsey, for an imaginative way of scrutinising the Bill.
The Government have had the benefit of a great deal of experience today. Indeed, the debate could have lasted twice as long. Some of the shortened speeches left much wisdom unsaid. I have received over 30 briefing papers from various organisations in preparation for the debate. Because there is an onus on us to get it right, we need a procedure which will allow the various interest groups to have their say at a pre-legislative stage. I hope that the Government take that on board and think imaginatively about the process.
Furthermore, that is illustrated by the fact that today we have had more than the usual number of declarations of interest. My noble friend Lord Thomson took the matter to a new stage. I have heard of the sins of the fathers being visited on the sons, but the success of the daughters being visited on the fathers is a new dimension.
My own declaration is that I am president of BREMA, the manufacturers' trade association. Over the past 20 years I have been involved in various capacities in the passage of most of the Bills. At present I am chairman of my party's study group on the White Paper.
My own involvement in broadcasting started just over 30 years ago, when I worked for the noble Lord, Lord Callaghan, in Downing Street. He said to me, 1252 "Find out what Merlyn is up to with the BBC"—and he was one of the Ministers whom the noble Lord trusted!
Perhaps I may just make a comment about what the noble Lord, Lord Eatwell, said about radio. That is often neglected. The Minister always has the stock reply that digital radio is far too expensive for him. The signs are that digital radio is making advances. Both the BBC and the commercial sector have given it a real impetus. The manufacturers have always said that they need the quantity before they can get prices down. One good sign is that Ford have said that they will put digital radios into their cars from 2004. It could be that digital radio will get its impetus first through car radio.
I turn to TV. It is only with reticence that I take issue with the call of the noble Baroness, Lady Flather, for a level playing field. Many of our problems over the past few years, and particularly much of the sniping at the BBC is because some of the commercial interests do not understand the matter. I can best illustrate that by saying that a few years ago I was involved in the setup of the National Lottery. I went to see a very senior civil servant with a representative of the football pool. The representative asked for a level playing field. After a while the civil servant said, "But you don't understand. We have no intention of creating a level playing field. We want the lottery to win". That came as a great shock. But I am sure that it would help the commercial interests if they realised that we want public service broadcasting to win.
Over the past few years, or certainly in the early part of the 1980s, the great debate has been whether public service broadcasting in this country would be forced into a smaller and smaller ghetto as it has been in the United States, in Canada, in Australia and elsewhere. But the great victory of the debates of the 1980s and 1990s is that in the 21st century we are determined to build into our regulatory framework of broadcasting a very strong public service broadcasting sector.
We wish the commercial sector well and that it should prosper. But the commercial sector should stop thinking that it can shrink the public service sector by constantly sniping at it. There is no doubt about that. I see the noble Lord, Lord Gordon, looks surprised, but I am not surprised because I have seen strong vested interests trying to undermine public service broadcasting in this country. I am happy and. indeed, in some ways pleasantly surprised, at the robust nature of the White Paper's defence of the public sector. I welcome that.
I feel that we have an opportunity on digital broadcasting, but it is not an opportunity if we leave it purely to market forces. Each individual digital provider is happy to adopt the cheap and cheerful technology that will get it subscriptions into a walled garden. I understand that. They have the interests of their shareholders profit maximisation to fulfil. But that commercial impetus is not necessarily the same one as a national commitment to an orderly digital switchover. I welcome the parallel White Paper, Enterprise, Skills and Innovation, published by the DTI and the Department for Education and Employment, 1253 which puts forward a whole range of initiatives for a proactive approach to the adoption of digital. Paragraph 4.5.3 of Chapter 4 of the White Paper sets out a real plan for a digital switchover. It will not happen without that kind of commitment from government.
I welcome the work done by Chris Smith and Patricia Hewitt. They have shown that grown-up government works. Chris Smith is the first Secretary of State to have made it to Cambridge television conferences—a great success in terms of the Ministry of Fun having been a rather short-term appointment in successive governments. However, at the base of it, we have to go back to the old mantra laid down by the noble Lord, Lord Hurd, in his White Paper—quality, diversity and choice. How do we do that? We do it by defending and building on the strengths of the White Paper and by using the consultative process to which the noble Lord, Lord Lipsey, referred. The danger is not that we progress from the White Paper but that we slip back and allow it to become green and frayed at the edges.
Our late colleague, Lord Ted Willis, used to say that the kind of Minister for whom he had the most contempt was the one who always carried the imprint of the last bottom which sat on him. In the communications industry, there are some very big bottoms about. Ministers will need support to resist being sat upon. I hope the Minister believes that he and his colleagues will have the support of this House if they remain robust in the defence of public service broadcasting and a truly inter-operable digital service.
§ 7.22 p.m.
§ Baroness Miller of Hendon
My Lords, I, too, am grateful to the noble Lord, Lord Gordon of Strathblane, for having used his valuable place in the ballot to introduce this debate on a topic of which he has had so much experience in his business career.
Communications is a topic which bears down on us with increasing intensity, complexity and with bewildering speed. Let me say, right at the outset, that we on these Benches accept the need for a major overhaul of the regulatory regime of the communications industry in all its forms, especially as the demarcation between those forms is becoming increasingly blurred. We can read newspapers on the Internet, and even watch the cricket from California. We can send and receive e-mails and faxes from mobile phones. Indeed, whereas 20 years ago you would ask someone if he had a fax, you now automatically ask, "What is your e-mail address?"
Considering the importance that telecommunications play in everyday life, with about 50 per cent of the population possessing mobile phones and that telecommunications are an essential ingredient in fax and e-mail and the Internet, it may surprise your Lordships to know that in the White Paper the word "broadcasting" is used 592 times whereas the word "telecommunications" appears only 78 times.
1254 Because of the increasing technical connection between the differing forms of communications, the time has come for some rationalisation of the industry. We agree that the time has arrived to consolidate the activities of the various regulators. As the White Paper points out in paragraph 1.3.2:There are nine separate regulators covering television and radio and telecommunications, with different regulators covering issues of taste and decency and economics and competition".Obviously, that cannot continue. In addition, the BBC is a law unto itself, and the White Paper proposes that it should continue to be so, with some slight modification. This gaggle of regulators is to be replaced by a single regulatory body to be called in the jargon of the day, OFCOM.
We also agree that this is the right route to take. However, this job is far too big and complex for any one person or superstar; or perhaps "superczar" is the right word. The Secretary of State told the other place on 12th December last year (at col. 487 of the Official Report) that the regulator,will be a hoard, not a single person",although the actual wording of the White Paper is,the new regulator will be governed by a board",which is not quite the same thing. Perhaps the Minister will explain this discrepancy because the White Paper makes it clear that OFCOM will consist of a chairman, a chief executive and other executive and non-executive members. We do not quarrel with that because obviously OFCOM will have to have a series of chairmen or managers of divisions or whatever to deal with its day-to-day operations. We are in actuality converting five large quangos into a gigantic quango filled with the favoured nominees of two different departments of the government of the day.
We accept that a single regulator is necessary, but we certainly believe that, without detracting from its essential independence, the regulator should be fully answerable to Parliament. I would appreciate the Minister reassuring me on that point because although the White Paper refers to OFCOM establishing links with the devolved assemblies and the English regions, there is no mention of accountability to Westminster. That is despite the fact that the Secretary of State told the other place that OFCOM,will be jointly accountable to me and my right hon. Friend the Secretary of State for Trade and Industry".—[Official Report, Commons, 12/12/00; col. 487.]The White Paper is the product of two government departments, the DTI and the hybrid Department for Culture Media and Sport, and gives rise to strange inconsistencies, depending on which department wrote which chapter. As a result, while it provides a superficial analysis of the subject and is undoubtedly full of good intentions, it is woefully short of detail and inconsistent in its approach. We see practical proposals to implement "light touch regulation" and self-regulation for broadcasters, but the chapters on telecommunications recite a litany of deregulation without containing any ideas of how this is to be brought about.
1255 We all know that, left to itself, regulation grows. That is a particular danger for OFCOM. It will inherit the responsibilities of the existing regulators. In addition, it will be given new concurrent powers with the Office of Fair Trading; concurrent, my Lords. This means that broadcasters will be simultaneously subjected to the jurisdiction of two separate authorities. Optimistically, the White Paper says that which of the two would exercise their powers in a particular case would be the subject of consultation in each particular case. Getting one authority to defer to an equal authority may happen elsewhere, but not on planet Earth! And whose criteria is the broadcaster supposed to conform to if they are not identical?
Left to themselves, the present constituent sub-regulatory parts of OFCOM are likely to seek to retain all their existing powers, and indeed take on board any new ones their colleagues enjoy, but which they do not. There is a danger, therefore, that we will have regulation by the highest common factor, rather than the light touch that the Government promise and which we all support. There is a saying about the devil being in the detail. Our problem is that there is a considerable lack of detail in the White Paper, which shows some signs of having been rushed into print ahead of the rumoured imminent general election. There is also the rumour of a draft Bill ready for publication. That would not be surprising when one considers that the Government wanted to tack this gigantic separate subject onto the Utilities Bill until common sense prevailed and it was left to separate legislation.
We look forward to seeing the Bill in due course. While I am not in a position to issue any blank cheques, I believe that all the principles will be acceptable. It is the only the detail that we shall want closely to examine.
We are not happy with the bland phrase buried in the fine print that,we will give OFCOM Competition Act type powers to levy financial penalties … This will bring the range of enforcement powers into line with the powers of other regulatory bodies, for example the Financial Services Authority".This means that the regulator could fine companies up to 10 per cent of turnover and impose penalties on individuals. There is lack of reference to any appeals procedure over the exercise of any of these regulatory powers, especially the financial penalties. I shall be pleased if the Minister is able to tell the House today what right of appeal would be available.
FSA type powers include those to enter premises and seize documents. Those powers are not truly consistent with a "lighter regulatory touch" and putting them into the hands of what—I am sure that noble Lords opposite will not mind my saying this—will be a political appointee could possibly be entirely inconsistent with the freedom of the press.
Another cloud no bigger than a man's hand appears in the seemingly innocuous and pious passage which states that,we believe there is a case for OFCOM to have a general responsibility to promote support for training … including powers to research and monitor performance".1256 By what standard in spin doctoring will that performance be monitored? One does not have to be paranoid to see where such powers could go wrong under the influence of any government, and where that might lead. I believe that it could represent a danger. Other regulators around the world are facing the same issues and Britain should take the lead by finding practical solutions.
To repeat and stress what I have said previously, we believe that the White Paper is short on practical measures to give the communications industry, in particular telecommunications, the space it needs to develop its potential. For example, I have time to touch only briefly on the wide subject of streamed video material on the Internet. Does the White Paper suggest that this should be licensed? Will there be the same "must carry" obligations as on public service broadcasting?
Telecommunications is a rapidly expanding international industry which technically knows no borders but in which Britain could and should play a major role. It seems to me that every door is left ajar and I await the draft legislation with interest. It is important to the economy that the entire communications industry should be regulated well, but not too hard, and that such regulation as is necessary is forward looking rather than backward looking. We on these Benches will support those ideas.
§ 7.33 p.m.
§ Lord McIntosh of Haringey
My Lords, along with other noble Lords, I am grateful to the noble Lord, Lord Gordon, for securing his place in the ballot and thus bringing forward such an expert range of speakers. That has made my task tonight extraordinarily difficult, not only because the White Paper is necessarily wide-ranging, but because the range of expertise to which I must respond is very great indeed.
Perhaps I may begin by agreeing immediately with the noble Baroness, Lady Miller, that the ways in which we communicate are being transformed. We have had and at the moment still have distinct static media—broadcasting, telephony and the Internet—but these are changing and converging with astonishing speed. I am not sure whether the president of Sony was right to say that great changes will take three years rather than 10 years, but certainly the change, for example, in the ownership of mobile phones over the past 12 months—an increase of 67 per cent—is absolutely staggering. I now find myself in a minority by not having one.
Many contributions to the debate have reflected a general recognition that the White Paper strikes an effective balance between lighter, more appropriate regulation and the continued protection of the public interest, although the balance of the debate has erred towards the public interest, and quite properly so. We believe that we shall meet the twin goals of freeing industry from outdated restrictions but still put in place a framework which will at its heart meet the needs of citizens.
1257 We have three main objectives: first, to make our communications and media market the most dynamic and competitive in the world; secondly, to ensure universal access to a choice of high quality and diverse services; and, thirdly, to safeguard the interests of citizens and consumers. Those objectives are not set out in any particular order of importance. The way in which we shall embody those is through the establishment of the office of communications, OFCOM. I was interested to hear the noble Lords, Lord Gordon and Lord Thomson, acquiesce to that, and the noble Baroness, Lady Miller, accept it. In that context, I was grateful for enthusiastic support, based on sound economic principles, expressed by my noble friend Lord Eatwell.
In response to the noble Baroness, Lady Miller, of course OFCOM will be responsible to Parliament. Any organisation responsible to Ministers is by that fact then responsible to Parliament. I am not sure that I welcome the reminders from the noble Baroness, Lady Miller, and my noble friend Lord Lipsey of the analogies with the Financial Services Authority and the Financial Services and Markets Bill. However, I am afraid there are many ways in which in due course a communications Bill will encounter some of the complexities with which we had to grapple when dealing with the regulation of financial services.
Perhaps I may start with the first objective of creating a dynamic market and look at the relationship between OFCOM and the Office of Fair Trading, which at present exercises the powers contained in the Competition Act in the communications sector. We see this developing in the following manner. As competition becomes more pervasive, we will expect to rely more on the general competition framework than on the sector-specific powers which will be exercised by OFCOM. However, we think that there will be a continuing need for sectoral powers, in particular to address the competition implications of technical bottlenecks and to protect the interests of consumers. OFCOM will be given appropriate powers in line with the new European framework. The noble Viscount, Lord Chandos, expressed doubts about that in his early remarks, but in the end I believe he came to recognise that this is the right approach.
So far as concerns ensuring universal access, I agree with the right reverend Prelate the Bishop of Wakefield that this will continue to need a strong regulatory presence. Everyone should continue to have easy access to public service television and radio channels. In the future, as it is now, it should be free at the point of delivery, along with other communications services at affordable prices. The proposals contained in the White Paper ensure that channels currently available free to air are carried on all platforms and that electronic programme guides provide easy access to them.
The Internet, of course, is more complicated. More and more people are gaining access to the Internet. They may access through personal computers, televisions, mobile phones and now even games consoles. They may access at work, at home—families 1258 with young children are increasingly going online—and in the future in access centres, to which I shall refer in more detail shortly. Businesses of all kinds can access global markets and make great efficiency savings in how they interact with suppliers and customers and in the way they make, market and trade their goods and services. Over the past year, business access to the Internet has risen from 50 per cent to 90 per cent. Since the beginning of 1999, household access to the Internet has more than doubled to 32 per cent. We have a part to play in this. By the end of last year, 42 per cent of government services were being delivered electronically. By 2002, this will increase to 73 per cent. We have a target of 100 per cent by the end of 2005.
On the issue of universal access, one comment made from the point of view of broadcasters—this was voiced by the noble Lord, Lord Gordon, and my noble friend Lord Bragg—was that we are being inequitable between terrestrial and cable and satellite broadcasting. The noble Lord, Lord Gordon, in particular, criticised the asymmetry of the "must carry" and "must offer" regimes. It is difficult to answer questions at the moment because, as he knows, currently negotiations are being carried on between BSkyB and ITV on non-discriminatory access. I should not like to intervene in those negotiations, except to say that, unless we achieve a just result from them, there is always Oftel in the wings, ready to act.
As to access to broadband, the noble Earl, Lord Northesk, is right; broadband matters. Our goal is for the UK to have the most extensive and competitive broadband market in G7 by the year 2005. That was set out in our broadband strategy document on 13th February—which, incidentally, is two months after the communications White Paper, not three months.
The noble Earl criticised the fact that we acknowledge that in some areas it will be many years before broadband access is available universally to homes. To achieve broadband access, it is necessary to install a server—let us say a telephone exchange or a central point—which has a range of only three to five kilometres from that point. One can therefore appreciate the difficulty of geographical access. In addition to local loop unbundling, we propose to set up an extensive network of approximately 6,000 centres, a matter to which the noble Lord, Lord St John, referred.
The noble Lord asked how we are going to do that. We are proposing to devote £10 billion over the next three years to connect schools, colleges, universities, libraries, hospitals, surgeries, police stations and the UK on-line centres to broadband. Even in areas where home broadband access is not physically possible, that will make a great dent in the inaccessibility of broadband.
As an initial step, we are setting up a new £30 million fund to support innovative schemes to meet local requirements and to ensure that as many people and businesses across the UK as possible have access to affordable broadband services. We are working with the Countryside Agency to introduce this scheme into rural areas.
1259 I recognise the points made about telecommunication services. I do not think that a word count indicates any lack of seriousness about this in the White Paper. I should say to the noble Viscount, Lord Chandos, that Internet security is partly the responsibility of the Electronic Communications Act of last year, which provides the framework, and partly the responsibility of self-regulation.
Quite rightly, much of the debate was about diversity and plurality. There was considerable criticism of the existing rules of media ownership and some comments were less friendly than others about our proposals. Generally, we want to consult on a new and suitable framework for regulating media ownership. We are clear enough about our policy but it is less obvious how we will put it into effect.
We do not argue that competition alone delivers diversity. Digital technology means that consumers can choose from a wide number of channels but that does not necessarily mean a more diverse range of content. The noble Lords, Lord Gordon and Lord Holme, and particularly the noble Lord, Lord Eatwell, recognised that point. If you have too many participants, then you have, I say with trepidation to the noble Lord, Lord Eatwell, the "hoteling" effect of the market working but generating more and more mass market output. We have seen that working rather badly in the United States.
The noble Lord asked whether we would apply our analysis to radio and specifically to the BBC plus two commercial stations. This is an issue on which we are seeking views through the communications White Paper.
While on the subject of radio, I fully appreciate what the noble Lord, Lord Ahmed, and other noble Lords have said about the importance of community radio and access radio, particularly for religious and ethnic minorities. We are very keen to encourage community radio—the White Paper is very strong on this point—and we see a continuing role for local analogue radio in religious broadcasting.
As I am on the subject of minorities, perhaps I should say something about communications for people with disabilities, which formed an important element of the debate. As noble Lords will know, we published plans at the end of January for improving access to digital terrestrial television for people who are deaf, hard of hearing, blind or partially sighted. This was debated in the House quite recently when I answered a Question tabled by the noble Baroness, Lady Ashton, in which reference was made to the heightened targets for special provision; to the half-price licences for the blind; to the extension of the regime to cable and satellite; and to the new regulations which provide for disabled access to public call boxes and text phones. The noble Lord, Lord Addington, made a point about individual phones, which might be more difficult to achieve. Certainly this matter is high on our list of priorities.
Securing quality is, of course, absolutely essential. We strongly reaffirm our belief in the value of public service broadcasting. I am sorry that the noble Lord, 1260 Lord McNally, was surprised by that; I thought we had been consistent in our view over the past four years. I should say to the right reverend Prelate the Bishop of Wakefield that I am not keen on measuring it or defining it, but it is there. The three-tier system of regulation that we are proposing is designed to protect that.
Tier one will cover all broadcasters. There will be codes establishing minimum content standards and rules on advertising and sponsorship. The noble Lord, Lord Borrie, referred to the fact that OFCOM could delegate to industry using the excellent example of the Advertising Standards Authority, although I think that the noble Lord recognises that television is a special case, both because of its persuasive power and the relationship between programmes and advertising.
The second tier provides for an element of external regulation for the BBC. This has raised a good deal of controversy in the debate. The noble Lords, Lord Gordon, Lord Bragg, Lord Holme, Lord Dubs, Lord Eatwell, the right reverend Prelate the Bishop of Wakefield and the noble Baroness, Lady F.-lather, all thought that the BBC should be completely under the control of OFCOM. If a debate on that subject were organised in the House, a large number of noble Lords could be persuaded by the BBC to put the opposite point of view. But certainly we have heard what has been said. I do not think that our view leads to the conclusion drawn by the noble Lord, Lord Bragg, that ITV is being ignored. ITV will benefit more from unified regulation than from the more discriminating regulation that we have at the moment.
In tier two we shall be concerned with quotas for independent productions and regional productions and the availability of news and current affairs in peak time. The requirements in this tier are important for the quality of broadcasting and for the continued success of the UK's creative industries.
Finally, in tier three, we propose that the qualitative public service remit of the broadcasters should be based on transparent self-regulation with back-stop powers for OFCOM in relation to commercial broadcasters and for the BBC, the Secretary of State, and Parliament. It should not be thought that the Governors of the BBC are not in turn responsible, through the BBC Charter, to the Secretary of State and Parliament. Again, I do not agree with the noble Baroness, Lady Greengross, that definition is what we need. What we need in practice is that the broadcasters responsible should make statements of programme policies, should report on them, and should develop adequate self-regulatory mechanisms which will be backed up, if necessary, by OFCOM. That will create a more level playing field for public service and commercial broadcasters, giving commercial broadcasters the challenge of demonstrating that they can exercise this new freedom.
There has been a great deal of debate about the regulation of content. I am well aware of the concerns, which were most eloquently expressed by the noble Lord, Lord Mitchell, about what is acceptable in broadcasting. OFCOM will take over the role of the 1261 Broadcasting Standards Commission in adjudicating on complaints of fairness and privacy; however, the issue of acceptability is much less clear. People have very different views about what is acceptable. I take the point made by the noble Lord, Lord Mitchell, about the even greater difficulty of regulating the Internet. The noble Lord will be aware of the Internet Watch Foundation and the content rating that it is proposing. But he will be the first to tell me that that requires international co-operation and international standards. The legislation will be constructed flexibly so that, as controls improve or expectations change, the degree of regulation can be adjusted by OFCOM in the light of research.
The interest of consumers as opposed to citizens is always a difficult distinction to make, although it is clear that there is a distinction. We shall be keeping the key role of the regulator in consumer protection, but we recognise the need for a consumer advocate. That is what the consumer panel will do. It will include codes of practice for people with disabilities and for minorities of various kinds. The noble Lord, Lord Ahmed, will be aware of the Cultural Diversity Network, which is now producing an action plan in this sphere. The question of interoperability—which is a consumer interest question—is for the industry in the first place, but there will be a back-up power to impose standards when necessary.
The issue of digital switchover is extraordinarily complicated. We have set out our tests: of availability, affordability and take-up. The noble Lord, Lord Bragg, is right to continue pushing us, because we are continuing to push ourselves. But there are significant problems in actually promoting, as the noble Lord, Lord Gordon, would wish us to do, the process of switchover. It has to be driven by availability, by the market and by individual decision rather than by government diktat. It will be recognised that it is not merely a question of the first television set in a home, but of all the other television sets, in children's bedrooms, in bathrooms or wherever they may be.
I was asked a number of questions about the organisational framework of OFCOM. I do not have time to answer them in detail, except to say to the noble Lord, Lord Holme: yes, indeed, it will be a start-up and not a merger. OFCOM will have important powers which existing sectoral regulators do not have. It will have the power to fine broadcasters for breaches of general authorisations, and the concurrent powers for the broadcast sector with the Director-General of Fair Trading under the Competition Act.
I say to the noble Lord, Lord Thomson: no, the British Board of Film Classification will not be handed over to OFCOM; however, it will be expected to adhere to the same tier one standards. I recognise the point that the noble Lord, Lord Dubs, makes about the need for consumer representatives. That is a question between OFCOM and the consumer panel. So far as concerns regional offices, I say to the noble Lord, Lord Ahmed, that there will be a regional presence. What form that will take is not yet known.
1262 I have been greatly encouraged by the tone of the debate and by a great deal of the content. Consultation is going on, and the speeches in this debate are very much part of that process. I am particularly grateful to the noble Lord, Lord McNally, for his support for what he sees in the White Paper as a robust defence of public service broadcasting—that is also my belief. I believe that that is what we are in the process of achieving. That process has a good deal further to go.
§ 7.56 p.m.
§ Lord Gordon of Strathblane
My Lords, I am grateful to all noble Lords who took part in the debate. Bearing in mind the observation of the noble Baroness, Lady Miller of Hendon, that broadcasting is mentioned 592 times in the White Paper whereas telecommunications is mentioned only 78 times, I am all too conscious that I concentrated exclusively on broadcasting. It is a question of my background. I was grateful, therefore, that within minutes the debate had swung on to broadband and the Internet. I was particularly grateful that we also gave due attention to the needs of the deaf and the blind and to the opportunities that the Bill could present to do something meaningful for them.
It is significant that very few speakers covered the same aspect of the Bill. That indicates the wide scope of the legislation that will shortly come before the House. I hope that the Government will reflect on some of the points that have been raised, and indeed on some of the innovative ideas as to how the Bill might be handled.
Most important of all, I hope that the Government will give adequate time for debate on the Bill. There could have been a full-scale debate on any one of the 20 or so contributions that we heard this evening. If the Chief Whip is listening, I say to him that it would be wise not to plan for too much else in the legislative programme for the Session in which the Bill is brought forward. In the meantime, I am happy to withdraw the Motion. I beg leave to withdraw the Motion.
§ Motion for Papers, by leave, withdrawn.