§ House again in Committee.
Lord Crickhowell moved Amendment No. 29:
After Clause 3, insert the following new clause—
"APPLICATION OF GENERAL DUTIES TO THE SECRETARY OF STATE
(1) Except as provided for in subsection (2), in carrying out his functions under the relevant enactments, the Secretary of State shall have regard to the general duties imposed by virtue of section 3.
(2) The provisions of subsection (1) do not apply when the Secretary of State is carrying out his functions under—
(3) In this section, "the relevant enactments" means—
§ The noble Lord said: In moving Amendment No. 29, I shall speak also to Amendments Nos. 311 and 312. I draw attention to page 31 of the report of the Joint Committee on the draft Bill, which deals with the duties of the Secretaries of State. The general policy of the Government has been made perfectly clear, and I respect it. It is that there should be a clear dividing line between the Government and regulators, and that the Government should set the overall legal framework and then allow the regulators independence to operate at arm's length from the Government within that framework.
§ However, the Government propose that they should have a range of additional powers over Ofcom. First, the Secretaries of State are able to issue directions to Ofcom in respect of networks or spectrum functions in the interests of national security or relations with a foreign country, for the purpose of securing compliance with international obligations or in the interests of the safety of the public or public health. The Government also propose to seek an additional power, subject to the affirmative resolution procedure, to further extend that range of purposes. Secondly, the Secretaries of State are able to issue directions to Ofcom in respect of broadcasting functions for the sole purpose of securing compliance with an international obligation of the United Kingdom. Thirdly, the Secretaries of State have wide-ranging powers to alter Ofcom's legal framework on a continuing basis by means of powers to issue more specific directions and to make secondary legislation.
§ The Joint Committee considered that, as a consequence of those powers, the Secretaries of State will be able to exercise functions that are regulatory by nature. That is indicated in Part 2 of the Bill by the fact that certain functions of the Secretaries of State are subject to appeal, in the same way as are those of Ofcom. It was those facts that led to representations from a number of organisations—the Royal National Institute of the Blind, in particular—to the effect that the general regulatory duties under the Bill should apply to the Secretaries of State, as well as to Ofcom.
That is not a new idea. It is not a novel concept. The Secretary of State is subject to the general duties under Section 3 of the Telecommunications Act 1984. It is a generally accepted principle, as we pointed out in the Joint Committee, that, in the words of the current Minister for Tourism, Film and Broadcasting,
General duties … set the framework in which regulators—both the regulatory authorities and the Secretary or State—exercise their functions".—[Official Report, Commons Standing Committee A. 29/2/2000; col. 232.]
Paragraph 42 of the Government's response to our suggestion that the general duties should, therefore, apply to the Secretaries of State said:
We believe the functions of the Secretary of State and Ofcom, as set out in the Bill, to be quite distinct. The Secretary of State would be carrying out her functions in the context of wider policy considerations. In doing so, it would be open to the Secretary of State to import broader considerations of public policy than could Ofcom in carrying out their functions in accordance with their general duties. We do not therefore accept that it would be appropriate in general for the general duties to also be applied to the functions undertaken by the Secretary of State".
§ I accept that there are certain functions of the Secretary of State that fall outside the general duties applying to Ofcom. It is for that reason that my amendment makes an attempt—I expect that I will be told that it is an imperfect attempt—to list the general duties that apply, except where they are exercising powers for public interest purposes. We understand that there are matters that should be exempted from any general duty application, and we have attempted to deal with that. The subsequent amendments deal with an outstanding element of the Joint Committee's recommendation 43, which was accepted in principle and relates to the reporting provisions of the Telecommunications Act 1984.
§ Having myself been a regulator, I am a little sensitive on the subject of general duties and the relationship between Secretaries of State and the regulatory organisations. I know that there are matters in which Secretaries of State get involved in one way or another. However, it is a more important matter that leads me to move the amendment. There is a matter of principle. If Parliament gives regulatory powers to Ministers, the nature of those powers should be made clear and should be limited. The Bill, after all, spells out the extent of and the limitations on the powers given to Ofcom. It must be right that it should spell out with equal clarity the extent of and the limitations on the powers given to the Secretary of State.
§ If Ministers believe that different duties should apply and that they should be specified differently, they should say so. The general principle that Ministers should not be empowered to do things without a set of principles that clearly define and limit their powers is an important one. That is the subject that I wanted to raise by moving the amendment. I beg to move.
§ Lord Puttnam
I support everything said by the noble Lord, Lord Crickhowell. I am supported in that by the noble Lord, Lord McNally, and the noble Lord, Lord Hussey, who is not in his place. In response to what the noble Lord, Lord Crickhowell, said, perhaps I may make an important general point which I hope I shall not have to raise again in Committee.
Along with noble Lords such as the noble Lord, Lord Crickhowell, I am a member of the joint scrutiny committee. It has been put to us that we are in danger of 1045 discrediting the process of joint scrutiny by tabling this very large number of amendments—70 in all. I should like to make it very clear that the reason 70 amendments have been put forward is because, as a joint scrutiny committee, we were wholly dissatisfied with the responses which we received from the Government to our report. I am a great believer in the process of scrutiny. If this process is to go forward, if it is to grow and to become a more important component of the life of this House, it will be increasingly incumbent on government to take joint scrutiny committee reports seriously, and not just numerically. I am delighted that the Government have responded positively to 122 of our 144 recommendations. It is not a matter of the quantitative; it is to do with the qualitative response—most particularly to those issues with which the Government do not agree.
Seventy amendments have been tabled in order to probe and encourage the Government to say in this Committee what they could just as easily—I think in a much more time-saving way—have said in their initial response. This is a very important issue. I doubt very much that my colleagues on the Front Bench will agree with it, but next time joint scrutiny is involved, I suggest that the Government take their response far more seriously and respond in a far more detailed manner.
Turning to the specifics of this amendment, the noble Lord, Lord Crickhowell, has covered most of the ground. Paragraphs 104, 105 and 106 of the joint scrutiny committee report make it clear that this is not a trivial issue. We suggest at the end of paragraph 106 that,Government should find it possible to draft the Bill so as to disapply the general duties from the Secretary of State where it is appropriate to do so. A general disapplication would appear to be at odds with the principles of earlier legislation".The noble Lord, Lord Crickhowell, made that point very well. I am becoming very confused as to when a principle is a principle or when a general duty is a general duty because, as far as I can determine, the Telecommunications Act, the Utilities Act and this Bill seem to have taken very different lines. Therefore, three different regulators are being given three different forms of advice for three different forms of occasion. It is not tidy. I am the last person in the world to stand in your Lordships' House and suggest logic; I am anything but a logician. But there is a desperate lack of logic in the responses of the Government to what are important issues. I support the amendment wholeheartedly.
§ Lord Fowler
I, too, support this important amendment. We are very keen on setting up regulatory bodies, giving them powers and laying down principles by which they should act. However, when it comes to it, I suspect that it is more important that successive governments and successive Ministers should act according to the kind of principles that are set out in Clause 3; that is, principles such as the maintenance of a plurality of providers of different television and radio services. These are issues which are set out there 1046 and which I think should guide successive governments and successive government Ministers. As the noble Lord, Lord Crickhowell, said, this clause spells out the position as far as Ministers are concerned.
I am bound to say that I start from a suspicion of governments and government Ministers becoming involved with the media at all. I emphasise and underline that irrespective of political party. It is not remotely a party political point. The overwhelming interest of any government is that they should be seen in the best possible light on all issues, which can lead to all kinds of actions. When I served in another place as shadow Home Secretary a few years ago. I remember the Home Secretary placing an injunction on the national press because of a report that was embarrassing to him.
As for the regulatory issues of this Bill. I underline a point made earlier. I believe that we all have suspicions about decisions on ownership made by governments. I certainly hope that the Secretary of State does not believe that there is any kind of consensus on the ownership provisions of the Bill, with which we shall deal later. We all deeply suspect that some previous decisions have been made on the grounds that it might be politically advantageous to do so—indeed, this also applies to decisions that will be made—because it is useful to have an owner on your side. On occasions, we suspect that Ministers can make decisions on reference to competition authorities which are very much based on their own beliefs, and which might reflect their own prejudices.
Not all of those issues can be tackled by one new clause inserted in the Bill. However, the proposed clause lays down guidelines under which Ministers should act. I assume that the argument against such a provision is that government Ministers are different from regulatory bodies in that they are answerable to Parliament; and they certainly are. But the process and progress of this Bill show how inadequate such a check can be today. Over 100 of the clauses in this Bill were not debated in another place. That is utterly disgraceful.
The noble Lord, Lord Puttnam, who accomplished such a fine job on the scrutiny of the Bill, should not be apologetic about the 70 amendments that he has put forward at this stage. When the Bill was debated in another place, we can all agree that no adequate check was placed on Ministers responsible for this policy. It is very difficult to argue against that position.
Although the proposed new clause is not a guarantee that Ministers will act objectively, sensibly. and with fairness, it would at least set down the principles that they should follow. The latter are important principles. I believe that most noble Lords in this place, and most of the people outside, would agree with them. I see every advantage in such a provision being included in the Bill in the way proposed by my noble friend.
§ 9.15 p.m.
§ Viscount Astor
I have some brief comments to make about my noble friend's amendment. Whatever party is in opposition, it seems to me that it is always moving amendments to Bills stating that the Government and the Secretary of State should have less power. It is then the duty of Ministers of the party in power to defend that position, because they are constantly being advised by their Secretaries of State in another place who, having finally reached their exalted positions, want to keep the maximum amount of power possible.
I make the following comments with due deference to my two noble friends who spoke before me, both of whom have held exalted positions in another place. Nevertheless, I am sure that they will understand. The issue has been debated in this Chamber on many occasions during the course of legislative scrutiny. The one lesson that we learned from the two previous broadcasting Bills is that such legislation quickly becomes out of date. Therefore, it is important for the Secretary of State to have such power in certain circumstances, but also to have a wider view of such matters than we can possibly perceive this evening. At the same time, the Secretary of State must be answerable to Parliament and, indeed, he or she should not interfere with the running and the operation of Ofcom. If we are creating such an entity then it is important to leave it to carry out its duties without government interference, whatever shade of government that may be.
The Minister will have to demonstrate why the amendment spoken to by my noble friend should not apply because, in principle, we all believe that governments should be made more accountable, not less so. To that end, I agree that the noble Lord, Lord Puttnam, should make no excuses for the number of amendments he has tabled, in particular given that, despite the best of intentions, the system operated in another place does not allow it properly to scrutinise Bills. This is a revising Chamber and we would be derelict in our duty if we did not carry out that role.
§ Lord McNally
On the point of the number of amendments which have flowed from the scrutiny committee, I hope that we have been able to strengthen the position of future pre-legislative committees in getting from the Government the proper response that the work deserves.
I wish to make a relatively brief point that flows from the remarks made by the noble Viscount, Lord Astor. There is much in the Bill that attempts to deal with the problem often encountered by broadcasting and communications Bills; namely, that very quickly they become out of date. As the joint committee noted, the Bill leaves a wide range of discretionary powers to Ministers, along with certain regulatory functions. Therefore I seek simply to put hack to the noble Lord, Lord McIntosh, the point he made about an hour ago. He pointed out very pertinently that we have spent one-and-a-half days debating in Committee the general powers of Ofcom. Having spent so long considering those general 1048 powers, it is a little rum to be told, "Oh, by the way, it does not apply to Ministers". Future historians would boggle at Parliament if such gaps were left so that Ministers could later ride a coach and horses through them. Furthermore, the noble Lord, Lord Fowler, was right to point out that many of those gaps could be used by Ministers to make highly sensitive political decisions.
The case for Ministers to be subject to the same responsibilities and guidelines that have been put with such care on the regulator is very strong indeed.
§ Baroness Buscombe
I rise simply to support the amendments. I am not sure whether the noble Lord, Lord Puttnam, was in his place earlier when I referred to what the Secretary of State said in public last week. He stated that we had already reached a consensus on the Bill. That is why I am particularly pleased that the noble Lord has confirmed that he makes no apology—and nor should he—for bringing forward these amendments.
§ Lord McIntosh of Haringey
I hope that the noble Lord, Lord Crickhowell, will forgive me if I start by responding to my noble friend Lord Puttnam. I shall do so because he sought to make certain general points about the work of his committee and the nature of the Government's response. His first point was that the Government should not be resentful of the fact that something like 70 amendments have emanated from what I refer to as the "gang of four"—I am sure my noble friend will forgive me for using that expression, because it is how I have thought of the committee all along.
We are not in the least resentful. We think that it is entirely proper for the pre-legislative scrutiny committee to recognise, first, that some 120 of the roughly 140 recommendations were accepted by the Government. My noble friend has acknowledged that and we are grateful to him for doing so. Conversely, however, it is also entirely proper for the committee to seek to protect and advocate the 20 or so recommendations which were not accepted by the Government. We harbour no trace of resentment about that and we do not in the least resent debating those points in public.
However, my noble friend went on to say that in some cases the Government's response was, shall we say, summary and that we would have saved time if we had argued the case in more detail. On that I do think he is wrong. When we consider the Government's response, it is a response not only to the recommendations, but also to the evidence which was presented to the committee. If he looks at page 405 of the evidence presented to the joint scrutiny committee by the Government he will see that the issues raised by the amendment are covered in great detail. Yes, the response to recommendation 42, to which the noble Lord, Lord Crickhowell, referred, is fairly brief. But if we look at the detail in the evidence, we said that a number of powers were conferred on the Secretary of State and we explained the rationale for them.
We have tried to define the powers and duties of Ofcom—particularly the general duties, which we have been debating for a day and a half—because it is 1049 important that we should get them right and that Ofcom should have powers and duties which are definable and workable. But that does not apply to the Secretary of State, who has to represent the public interest for a period of time.
We suggested six broad categories where the Secretary of State should continue to have powers which were not restricted by the Bill. Incidentally, the amendment would restrict the Secretary of the State not only to the Bill but to Clause 3 of the Bill, which is not concerned with the whole range of responsibilities of either Ofcom or the Secretary of State.
The six broad categories are: future-proofing powers, which have been referred to, that permit changes to the Bill once it has been enacted to ensure that it remains effective in the light of rapidly changing market dynamics—a point made by the noble Lord, Lord McNally; powers to ensure public policy objectives, such as the provision of services essential to full social and economic inclusion—yes, of course it is a proper objective of Ofcom, but Ofcom cannot achieve it by itself and it needs to involve public policy; powers to ensure compliance with international obligations, a point recognised by the noble Lord, Lord Crickhowell, which he did not contest; powers to ensure the effective operation of concurrency and competition law and which concern the interaction between the Bill and the Competition Act 1998—which again has not been questioned as being a legitimate role of the Secretary of State; transitional powers—which again have not been contested; and the consequential powers needed to ensure that other areas of the law affected by the current regulatory regime are amended to reflect the proposed regime. Those are all matters which we need to get right to ensure that Ofcom is properly established.
None of those powers seem controversial. They are not difficult to understand. It is clear that the Secretary of State will have to do this before, during and after the existence of Ofcom. No, I am sorry; Ofcom must last for ever, must it not? Nevertheless, these are proper things which, in the exercise of public policy, any Secretary of State must do. The fact that Parliament has created an Office of Communications and given it defined and workable powers ought not to detract from the responsibilities of any Secretary of State.
It is suggested by the noble Lord, Lord Crickhowell, that somehow the responsibilities of the Secretary of State are not constrained. They are constrained all the time. They are constrained by obligations arising under European Community law, under domestic law and under international treaties to which the UK is a party. All this is set out in the evidence that we gave to the committee of the noble Lord, Lord Puttnam. So it is not new to any noble Lord to whom I am speaking today.
Before using the power, the Secretary of State would need to consider whether such action was proportionate and compliant with the EC communications directives. But the exercise of the powers is not subject to the general duties set out in Clause 3(1) and 3(2) of the Communications Bill. The reason for that is that the 1050 Secretary of State can be expected to exercise wider public policy discretion than that of Ofcom when using its powers under the Communications Bill. Clause 3(1) imposes obligations on Ofcom, among other things, to further consumer interest and promote competition—although the wording has of course changed; we do not say "promote competition" any more—and to encourage efficient use of the radio spectrum. The Secretary of State will not be limited to the consideration of these factors when exercising her powers—and nor should she be.
The Communications Bill does not impose a duty on the Secretary of State to take these factors into account, since Ofcom and the Secretary of State do not perform or share regulatory functions. This is the fundamental point which has to be recognised; it was made clear in the Government's evidence. The Secretary of State is constrained by the specific criteria listed in the Communications Bill, by the negative resolution procedure, by the affirmative resolution procedure and, of course, by the general requirements of administrative law.
The noble Lord, Lord Crickhowell, recognises the division of power regarding the Secretary of State, who is accountable to Parliament. However, both former Secretaries of State—the noble Lords, Lord Fowler and Lord Crickhowell—are very cynical about the exercise of the functions they once exercised so joyfully.
§ Lord Fowler
I am not so cynical about that; I am, however, rather cynical about a Bill which appears in this House when over 100 clauses have not been considered. Does the Minister regard that as satisfactory? Is that what he is aiming to achieve?
§ Lord McIntosh of Haringey
I have made no reference to that at all; I am not responsible for procedures in the House of Commons. That is the responsibility of the House of Commons. It would be utterly improper for me to make that kind of comment. The Bill comes to us having received such consideration as the House of Commons sees fit.
§ Lord Puttnam
Before the noble Lord moves on, I should like to make two points. First, I did not claim or suggest that the Government Front Bench were resentful of the number of amendments we brought forward. I did, however, make the point, which was put to me by the Government, that we—the gang of four—were in danger of discrediting the process of joint scrutiny because of the volume of amendments brought forward. I want to make it very clear—and I think I probably have an agreement from the noble Lord, Lord McIntosh—that that is not the case. It is important for the Committee to understand that the Minister agrees with me that it is very proper for a joint scrutiny committee to bring forward these amendments if it does not feel that the Government's response has answered it adequately.
Of course the evidence the Minister referred to was taken into account by the joint scrutiny committee, but that was before we published our report. Is the 1051 Minister really saying that we should not have published our report because of the evidence received or that it would not have been a good idea—I think he used the word "perfunctory"—to answer a lot of detailed suggestions in page 31, paragraphs 104, 105 and 106, with something rather less than this pathetic response in paragraph 42 of page 13 of the Government's response? That is my point. If we are making powerful points, they should be answered powerfully, irrespective of whether the Minister feels that the evidence might have clarified the situation in the first place.
§ Lord McIntosh of Haringey
I do not know what has been indicated to the noble Lord, Lord Puttnam. For myself and my colleagues on the Front Bench, I repeat that as far as I am concerned, it is entirely proper and, indeed, desirable for the joint committee, having made recommendations which were not accepted by the Government, to pursue the matter in Parliament by putting forward as many amendments as it thinks fit. I have never had the faintest doubt about that. If anybody else has indicated anything else, at the risk of charges of splits. I do not agree with them.
Secondly, I did not use the word "perfunctory" and I did not use the word "pathetic". After all, the report has 140 or so recommendations, and each one is fairly short. I said that our response was summary—in other words, it did not cover all the detailed arguments we put to the committee in our evidence in any form. There really is no disagreement between us on this. We are delighted to be able to debate these matters with the noble Lord, Lord Puttnam, and his colleagues. We think it right that we should, and I hope that nobody will think that, given the time I have taken in responding to this amendment, we on the Front Bench have treated it with anything less than the respect it deserves. We do not agree with it; we think that there are separate functions for the Secretary of State, who has wider, continuing, changing responsibilities to Parliament and must ensure that we conform with our international obligations.
We understand the motivation behind the amendment and the skill with which it was framed, because it very properly excludes matters of national security and other matters in which the Secretary of State ought never to be constrained. However, we do not believe that it is a proper way in which to set up an office of communications or to define its responsibilities in a workable way, or that the Secretary of State, who has wider responsibilities, should be constrained by a particular part of the general duties of Ofcom.
§ Lord Crickhowell
I am grateful to all Members of the Committee who took part in this short debate, especially to my noble friends Lord Fowler and Lord Astor and to the noble Baroness, Lady Buscombe, who supported the amendment from the Front Bench. However, I must make special reference to the speech of the noble Lord, Lord Puttnam, who so ably chaired the joint committee.
I am sure that the noble Lord will be, as I am, extremely grateful to the noble Lord, Lord McIntosh, for the statement that he has just made from the Front 1052 Bench about these amendments and our right to table them. I regard it as profoundly shocking that anyone should have suggested otherwise, so it is good that we now have an authoritative statement in the House from the Government. I put a little emphasis on the words "in the House", because this is one of the issues that was never debated in another place. The only reference to the duties of the Secretary of State was in the moving of a clause at the tail-end of the proceedings in another place, when it was proposed that a report should be published on the exercise of those duties. That itself says something about the issue.
I am bound to say that I found slightly bizarre the answer to the criticisms that the response to the Secretary of State was perfunctory and inadequate. That answer drew attention to the evidence on page 405 that was given to the joint committee, but we had that evidence in front of us and we took account of every point in it when we drafted our report and made the comments and criticisms contained in it. It is precisely because we received that evidence that we drafted our report. To say that it is a response to our report seems a most extraordinary supposition.
I do not question that the Secretary of State must have broad categories of powers. Indeed, I referred to most if not all of them. However, I come back to the fact that general duties have been applied to the Secretary of State in similar circumstances in other legislation, such as the Telecommunications Act 1984. Yes, Parliament will have the opportunity to deal with matters brought forward by regulation. Yes, there will be amendments later in these proceedings to some of the powers that may be taken by the Secretary of State, and we will debate them in more detail. However, the fact of the matter is that by referring to the evidence on page 405, the Minister has failed to answer the criticisms that we made. He could not provide an answer by referring to it because that was the basis of the criticisms that we made.
I acknowledge that at this hour of the night, with an important Statement to follow, this is not the time to pursue the issue. However, in the light of the inadequacy of that response, we shall have to consider carefully what to do at a later stage. I beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.
Lord Thomson of Monifieth moved Amendment No. 30:
After Clause 3, insert the following new clause—
"DUTY TO PROMOTE COMMUNITY MEDIA
(1) It shall be the duty of OFCOM to take all such steps as they consider appropriate for promoting the growth and development of community media.
(2) In this section—
community media" means communications services provided primarily for the benefit of members of the public in a defined geographical locality or of a particular community and not operated by the BBC or for commercial purposes.
(3) In subsection (2)—
communication services" includes—
§ The noble Lord said: This group of amendments seeks to establish in the Bill the place of community media operations in the new landscape of broadcasting and telecommunications for the 21st century as set out in this massive Bill. Community broadcasting already has a long and honourable history. I can remember a local charity in my old constituency running an excellent local hospital radio service, for example. In the past, however, community broadcasting has always been limited by spectrum scarcity and has always met with—I am bound to say, and I say it with a guilty sense of self responsibility—a certain disdain from the engineering mandarins of the BBC and the IBA.
§ We are now in a new situation. Road maps are very much in the news these days. This group of amendments seeks to set out a road map for the expansion of community media across the new broadcasting landscape. That landscape should include community-based radio, television and Internet projects, and they should be on the face of the Bill. The Government's proposals recognise the potential benefits of community media, but they are disappointingly tentative in delivery. The Bill provides enabling powers but no firm commitment to a tier of not-for-profit access radio services, an access radio fund or the development of local digital television services.
§ The organisation Community Media is the coordinating organisation in this sphere. It is eager to exploit new opportunities for interaction between audiences and producers and to involve people directly in media production for community benefit and public service. Despite the difficulties, community broadcast groups are already quite widespread in the United Kingdom, located in both urban and rural areas. Radio Ryedale, for example, is a rural Internet-based webcast radio station and website. Tenantspin is a broadcast television service run by tenants in a Liverpool tower block. Desi Radio has a pilot 12-month licence for a radio service for West London's Punjabi community. Solent TV is a new not-for-profit community television service for the Isle of Wight.
§ In the future, community broadcasting will expand to go on broadband and be receivable through the next generation of mobile telephony. However, it has been held back by a lack of regulatory support, difficulty in securing access to frequencies and channels and the absence of a structural financial base. Amendment No. 30 therefore proposes to make the promotion of community broadcasting one of the duties of Ofcom, linked to a clear definition of this important and growing sector.
§ The next amendment in the group is Amendment No. 175. This new clause has the purpose of placing community television on the face of the Bill rather than leaving it to secondary legislation. The new clause has 1054 been drafted to provide a clear definition of community television and licensing criteria which would ensure the distinctive nature of community television as different from other local television services. As the cost of television facilities reduces and the techniques become easier to learn, there will be considerable interest in the development of new community television services.
§ Amendment No. 176 deals with the funding of access radio—or community radio, as it is more widely known. The amendment proposes that access to radio should be able to draw on a variety of funding sources. The principle of a mixed funding base is important both to the viability of this sector and to its independence. That funding base should be allowed to include public funds and private funds raised from commercial sources such as advertising and sponsorship.
§ I fully recognise that some in commercial radio, mainly existing smaller-scale local radio services, have expressed understandable fears that community radio carrying advertising sponsorship might have an adverse economic impact on their business. We consider that unlikely and not supported by researched economic evidence. The best evidence that that is the correct assessment is to be found in the proposed new clause in Amendment No. 177. That seeks to replace the existing Clause 258. It has been drafted by the Community Media Association in consultation and agreement with the Commercial Radio Companies Association. It has the purpose of placing community radio on the face of the Bill rather than leaving it to secondary legislation.
§ The new clause provides a clear definition of community radio and licensing criteria which would assure the distinctive nature of community radio as different from other local radio services. It does so by amending the Broadcasting Act 1990 to give community radio a status in legislation alongside other independent radio services.
Community radio is already a substantial and growing sector in the United Kingdom but it has been held back by an inappropriate regulatory framework. The Government have acknowledged the potential benefits of community radio. Over the past 12 months, with the Government's agreement, the Radio Authority has introduced, and recently extended, 15 experimental services—the access radio pilot scheme. The independent evaluation of that scheme completed in February of this year by Professor Anthony Everitt lends strong support to the case for a distinct licensing framework for community radio. In the foreword to his report Professor Everitt, a former secretary general of the Arts Council, states that this new tier of radio,
promises to be the most important cultural development to take place in this country for many years".
§ The question now is not whether to proceed but how and under what rules. While the detail of licensing can well be left to Ofcom, there is no remaining reason why there should not be provision for community radio on the face of the Bill. That would give clarity both to aspirant community radio broadcasters and to the 1055 existing radio industry and would ensure that the new community radio sector builds on a clear parliamentary mandate for development.
§ Finally, I turn to Amendment No. 302 which sets out a new clause to put the community media fund into the Communications Bill as a primary legislative provision. That would give the fund a similar status to the Gaelic Media Service. An important principle of any public funding mechanism for community media, and indeed other forms of public service media, is that the arrangements should be at arm's length from both government and the regulator. That is an important guarantor of editorial independence and it is necessary to avoid the funding mechanism becoming an additional tool of regulatory intervention. I tell the Committee as a Scot that the arrangements in this amendment are similar to those provided for the Gaelic Media Service and consist of the appointment by Ofcom of the members of the community media foundation who then take decisions within the framework set down in the legislation.
§ The community media fund would be only one source of the financing of these new projects but it is thought that it might contribute between 20 and 40 per cent of costs depending on the need and the size of the operation. A potentially controversial issue is the source of income to the community media fund. In our view that should be taken directly from the receipts of Ofcom as part of the funding of the broadcasting side of the whole Ofcom, operation. Alternatively, however, the receipts could be paid from the Consolidated Fund or, as some have suggested, from part of the BBC licence fee. For my part I would not rule out a part of the BBC licence fee but I think that in practical terms that would need to be examined in the context of the review of the BBC services and the charter renewal process. If our professed mechanism of funding from Ofcom receipts is not adopted, we on these Benches would recommend that the community media fund be set up initially through a contribution from the Consolidated Fund. I beg to move.
§ The Duke of Montrose
I would like to offer my support to Amendment No. 30. Community organisations work in sound, pictures, text and moving image, and encourage interactivity and community participation. A future-proof Communications Bill committed to community-based media should provide Ofcom with a clear duty to take a strategic cross-media approach to the growth and development of all forms of community media. In doing so, it should take account of the range of present and future platforms, and the trend towards convergence and new interactive media.
We are all aware that the attraction provided by community media is that they give a channel for the promotion of culture, heritage and identity. They give access to local information, encourage citizens' participation, provide a platform for diverse cultures, and create a sense of local identity and community.
Scotland has been at the forefront of community media development in the UK. There are a number of successful community radio stations in the highlands and islands that have been pioneers in developing the 1056 model for community radio. At one time, I came across what might even have been a spoof radio channel called Radio Clachnacuddin, which took a light-hearted look at the situation around Inverness.
Amendment No. 177 deals with Clause 258. The Bill makes provision for a new type of radio licence that will enable the establishment of community radio stations all over the UK under the "access radio" provision. One of the "access radio" pilot stations, Radio Awaz, is also based in Scotland, in Glasgow. It has demonstrated the social benefits of community radio in the Asian community. Awaz FM not only fills a gap in entertainment and cultural provision, but gives the city council and police, who support it, and other public agencies an avenue of access to a somewhat isolated Asian community with which they find it difficult to communicate effectively by other means.
As it stands, the Bill seems liable to enable the concentration of media ownership into fewer hands. There will be a growing need for community media in promoting and protecting local culture, and in enabling minority voices to be heard.
§ Lord Phillips of Sudbury
I too strongly support this group of amendments. Because community media, both television and radio, are so little known and make up such a tiny proportion of the total broadcasting output, there may be a temptation to overlook their potential. On other Bills, we spend a lot of time in the House trying to address the intractable problem of social exclusion. It is fair to say that community radio outlets reach the parts that commercial broadcasting and the BBC do not reach. That is mainly because they are set up and driven by the communities that they serve.
I came across a striking example of community radio in the Feltham young offender institution recently. It is a remarkable and hugely encouraging experiment in community broadcasting, where the inmates do all the work necessary to broadcast not only within the prison, but for four weeks a year to the neighbouring community. As many Members of the Committee will know, the extent to which community media can broadcast is currently limited to a four-week broadcasting stretch at a time, save for the 15 pilot schemes that the Radio Authority has allowed recently.
As my noble friend Lord Thomson of Monifieth said, the Bill only refers, and then indirectly, to the community media in terms of the enabling arrangements under Clauses 241, 258 and 352. The Government may be inclined to say that they deal indirectly with community media in the keynote clause of the Bill, Clause 3. Members of the Committee may recollect that Clause 3(1)(b) refers to furthering,the interests of the community as a whole".However, that does not cover at all the territory covered by the amendments, which directly address media outlets that are non-commercial. That is crucial, and should put to rest any anxiety from the commercial broadcasters as to the danger that 1057 community media pose to them. So, first, the amendments address the non-commercial media. Then, as the definition in Amendment No. 30 makes clear, we are looking at particular communities, whether geographical or interest groups, rather than, and in contradistinction to, the community as a whole.
The Community Media Association deserves a great deal of credit for what it does. It has 250 organisations as members, 170 of which run some sort of community-based media—the vast majority being radio. That small army of community media could and should grow in the coming years exponentially. It needs to grow exponentially, because, as has been said, it has a direct and unique impact on the particular community that it serves, being created by them and serving their needs directly, enabling them and giving them esteem.
So for all of those reasons I hope that community media will cease to be the Cinderella of the broadcasting family. I should like to think that bringing them to the heart of the Bill in the explicit way provided for in the amendments could usher in a new era for these very important small media outlets.
§ Baroness Buscombe
We are supportive in principle of community media, and in particular of community radio. We are sympathetic to these amendments put forward by the Community Media Association.
I want, however, to raise a point in regard to Amendment No. 302. To be brutal, where will the money come from for the community media fund? Suggestions have been made by noble Lords that it should come, for example, in terms of receipts from Ofcom; but, in practice, is the funding to come from general taxation, from the national lottery or from some other source? Or is it to come from the general fees that Ofcom charges its licensees?
We have had input from commercial broadcasters, who have raised some concern that, were they to pay into the community media fund as suggested by the amendment, they might be prevented from diverting resources for the improvement of their own services. There is a potential conflict here. I shall be interested to hear how the Government will respond to the amendments.
§ Lord McNally
I have added my name to the amendments. The case for them was skilfully put by the noble Lord, Lord Thomson. I want to put to the Minister the fact that I was originally attracted to this cause as the result of meeting a young black activist from one of the more troubled London estates. She told me enthusiastically about the impact that local access radio had had on that estate in terms of getting through to young people and getting across positive messages of community.
Listening to the advocates of these proposals, it seemed that I had heard some of the arguments previously. I say that in the ominous presence of the noble Lord, Lord Gordon of Strathblane. In regard to community and access radio we seem to be hearing many of the hopes that we originally heard in regard to local 1058 radio. It is rather sad that in some ways local radio has been hoovered up by the conglomerates. Part of the debate that we had earlier about music, poetry and the spoken word from local communities has somehow been lost because of the commercial pressures and commercial amalgamations. The attraction of community broadcasting is that it gives us a second chance to use the technologies: to give local communities access to the technologies for local use, which may have been lost in the first round. One of my fears is that unless such a provision is written into the Bill, commercial interests will lobby against the greater proliferation of access radio—if they are successful, they will, make no mistake, take the audience from their commercial competitors—or they will work out some way of buying them all up because they were attracting audiences. We should then be into the same cycle of amalgamations and consolidations, which lose the essence and the attraction of that sort of broadcasting.
§ 10 p.m.
§ Lord Gordon of Strathblane
Before the noble Lord concludes, I offer him a further avenue of collaboration between the commercial sector and community radio. I do not mean to sound cynical, but there is a grave danger that community radio and community media are set up for the producers rather than the consumers. Grant-giving powers will simply be a beacon of hope to everyone who cannot get a job in the BBC or commercial radio to the effect that the local rates will give them the job of setting up their own radio station even if they are broadcasting, frankly, only to themselves. That sounds terribly much like a put down but I do not mean it in that way. Some of those people do very good work.
However, there is another way forward. When the Annan committee was set up, I advocated to it that comparatively large stations such as my own at that point—Radio Clyde, which covered Glasgow—should be obliged to take rural areas under their wing. Radio Oban was a community radio service that covered Oban, which, as I recall, had a population of about 5,000 people and therefore, frankly, had no chance of being viable on its own. We offered a radio service to it as a sustaining service. We paid for it—for the land lines—but it could opt out of the arrangement whenever it wanted and could do its own thing whenever it wanted; it had a sustaining service for the rest of the time. That is a potential way forward. We had no vested interest in the matter whatever. The advertising revenue from 5,000 people is, frankly, buttons. It would not affect us one bit. We were happy to do that because we thought that it was worth while.
That might he the way forward. We should not get caught up in the idea that community radio is automatically a good thing. I can quote examples by the barrel-load in Scotland of public money being ploughed into community radio, which went bust in six months because, frankly, no one was listening, not even the person's mother.
§ Lord Phillips of Sudbury
I was involved professionally, 25 or more years ago, in setting up the first partnership radio in Cardiff between the 1059 commercial and the voluntary sectors. They bid for and won a licence. Unfortunately, that bold experiment ultimately came to naught. I ask the noble Lord to consider that precedent. There are real problems about co-equal partnerships. The partnership that the noble Lord may have referred to was one of dominance by the commercial entity—
§ Lord Phillips of Sudbury
Well, if "not at all", the noble Lord should study the Cardiff example. It does not lend much encouragement to the noble Lord's idea.
§ Lord Gordon of Strathblane
This matter is entirely trivial hut, purely for the record, Oban FM decided entirely on its own what it wanted to do. Radio Clyde had nothing to do with that. We were simply available, at no cost to it, whenever it wanted to fill gaps. The arrangement was entirely and quite genuinely altruistic.
§ Lord McNally
I believe that it is now my turn to speak. That exchange underpins the need for some protection for community radio in the Bill.
§ Baroness Blackstone
We have had an interesting debate on this matter. There is a slight danger that community media may become a little like motherhood and apple pie—necessarily always a good thing. I was enormously grateful for the intervention from my noble friend Lord Gordon of Strathblane. He brought to the debate a touch of realism as well as a rather constructive and interesting practical way forward.
I do not want to suggest that the Government believe that opportunities for community media are not a good thing. We believe that they are. But I shall disappoint the noble Lord, Lord Thomson of Monifieth, by saying that I do not support Amendment No. 30. Indeed, I am afraid that I am unable to support any of the amendments in this group. I do not support Amendment No. 30 because I do not believe that it is necessary. Powers already exist to licence local TV and radio services. Clause 241 provides for local digital television regime stations and Clause 258 will enable the Secretary of State to introduce a new tier of access radio. We believe that enabling powers of that kind are appropriate here.
Given that the powers will exist to license access radio and local TV, it is not clear what point is served by giving Ofcom an additional duty to promote those services. Ofcom already has a number of general duties that one would expect to encourage the development of local TV and access radio. I am confident that that will happen. Ofcom's duty in Clause 3(1) is to further the interests of consumers and the community as a whole. Put that in the context of Ofcom's duty in subsection (2)(c), to secure,a wide range of television and radio services which … are both of high quality and calculated to appeal to a variety of tastes and interests",1060 and one can see the relevance of Ofcom supporting and encouraging the development of community TV and radio. In the light of Ofcom's existing powers and duties there is not, in my view much, if anything, to be gained by adding yet another duty to promote community media.
The noble Duke, the Duke of Montrose, raised the issue of convergence. It is perfectly true that it has been argued that a duty to promote community media is necessary because of the increasing convergence between media. The Bill is certainly designed with convergence in mind but that does not mean, for example, that the provisions dealing with radio and TV can or should be merged into a single set of provisions. The main driver for convergence is the creation of a single regulator which is well placed to look at issues across the communications horizon. It is not necessary to converge the powers if the body that exercises the various powers is itself converged.
Turning to Amendment No. 175, I am unclear why this clause is necessary. We are committed to supporting local television, and existing analogue services are proving an important local focus for communities and a popular form of broadcasting. Ofcom will be able to licence local analogue TV as at present. And, as I have already indicated, Clause 241 provides for an effective licensing regime for local digital television which can come into force by order once digital spectrum becomes available. It is therefore not clear what the relationship is between the existing powers and the new clause. The new clause sets out criteria for award of such licences but these are not greatly different from those already in Clause 241. In short, other than cause a degree of confusion in the relationship between various licences, I do not think that this clause adds a great deal to the existing powers.
In regard to Amendment No. 176 we believe that it is important that the Secretary of State should be able to use the order to place limits on the amount of sponsorship and advertising that access radio stations can take. That view is backed up by the very thorough evaluation of the pilot stations by Anthony Everitt which was published in March. He concluded that access radio stations should normally be able to receive no more than half their funding from advertising and sponsorship. In areas where there is a small commercial station, an access radio licence should be offered only if the applicant can show that it will present little or no advertising sales and sponsorship competition.
No decisions have yet been taken on the funding of access radio, but it is clearly essential that the order should be able to place restrictions on the amount and type of advertising and sponsorship that such stations could carry.
I turn to Amendment No. 177. There is no need for the new clause because Clause 258 already gives Ministers the power to introduce access radio. We are still in the process of considering Anthony Everitt's report, but I am confident that we will bring forward an order later in the year for consultation. It will be debated in both Houses, subject to the successful passage of the Bill. So I am not quite sure why the noble Lord, Lord Thomson of Monifieth, is opposed to dealing with this matter in secondary legislation.
1061 The amendment itself appears to want to bring access radio within the mainstream radio licensing regime. It seeks to do that by inserting a reference to "access radio" into Section 104 of the 1990 Act. However, Section 104 deals simply with the process of making an application. If the amendment were agreed, I am not clear how access radio would be treated in respect of other aspects of the licensing regime. The amendment is silent on that matter. In that sense, I think that it may be defective.
Anthony Everitt's report identifies a number of special issues which need to be addressed with access radio. They include funding, a matter which I have briefly mentioned. There are other issues; for example, how to deal with changes in the composition of the board and arrangements for evaluation, in particular with regard to receipt of government grants. Again, it is unclear how these matters are to be dealt with. The new clause does not tell us. They are questions that must be considered carefully.
We believe that access radio should be introduced in such a way to ensure that it has a good chance of success. That is through an order, on which we can consult, get people's responses and which Parliament will then have to approve.
Finally, I cannot support Amendment No. 302 as I believe that any fund should be limited to access radio. It is a prudent assumption that if and when we are able to secure funds they will necessarily be limited. If so, TV would almost certainly swamp the fund. The end result would be that the jam would be spread terribly thinly. So let us be realistic and try and make a success of access radio. We should not deliberately raise expectations that we cannot fulfil. A small, oversubscribed fund could damage, not help, the development of community media. We do not want that to happen.
On the issue of funding, there are certainly no plans to fund community media through broadcasting fees. That responds to the point of the noble Baroness, Lady Buscombe, that were that to happen it would become an issue for other broadcasters. We are looking at the prospect of some Exchequer funding for access radio, but no decisions have yet been made. It would—as I always have to say on these occasions—on the availability of resources. Finally, on that note, I do not think it would be right in some way to top-slice the BBC licence fee. The BBC is universally available, whereas access radio will only be available in local areas. I believe that it would be wrong to use a fee paid by virtually everyone in the UK to support services that would be available to only small numbers of people.
In the light of the arguments that I have put forward, I very much hope that the noble Lord will feel able to withdraw his amendment.
§ Lord Thomson of Monifieth
The Minister will not be surprised that I am disappointed with her reply. That does not particularly surprise me either. One is accustomed to being disappointed by ministerial 1062 replies. However, I am rather sorry that it was such a dispiriting reply because the community media movement comprises enthusiastic people who deserve more encouragement than that which came from the Government Front Bench.
However, in consolation, it was not a response without substance. Having listened to it, it mentions several matters that we shall all want to study to consider whether we want to make different approaches later. I am interested in what my former colleague, the noble Lord, Lord Gordon of Strathblane, said about partnership with community radio in Oban, for example.
So we shall return to that matter, but I am bound to say that I am dispirited by the tone of the response. In a massive Bill dealing with great issues—such as the creation of a global industry of telecommunications and broadcasting and of international ownership, which in turn raises great issues about the quality and character of the broadcasting scene in this country—I am rather dispirited that such a modest, grassroots operation should receive so much cold water from the Government Front Bench. However, I beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.
§ Clauses 4 and 5 agreed to.
§ 10.15 p.m.
§ Clause 6 [Duties to review regulatory burdens]:
Lord Luke moved Amendment No. 31:
Page 7, line 33, at end insert "; and
(c) to seek the views of persons providing services and facilities in relation to which OFCOM have functions on which of these functions should be subject to review.
§ The noble Lord said: I shall speak also to Amendment No. 32. I suspect that the importance of ensuring that the regulatory regime keeps pace with advances in the industry will become a recurring theme in our discussion of the Bill.
§ Amendment No. 31 is designed to ensure that the regulator consults the communications industry on those regulatory functions that should be subject to review. It is most welcome that Ofcom is required from time to time to review the regulatory burden and to identify those aspects of the regime that are no longer necessary or applicable, but I am concerned that despite those welcome inclusions, there is still a danger that Ofcom may lose sight of the views of those whom it regulates.
§ From the experience of the Independent Television Commission and Oftel, we know that new developments in the communications industry can call existing regulation into question. The amendment would simply mean that Ofcom would consult the relevant service providers on those aspects of regulation that it believed should be subject to review. It would give business stakeholders confidence in the regulator's approach, while allowing them access to the detail and conclusions of the regulator's discussions. It 1063 would also allow businesses to plan ahead with a clear view of how future regulation would affect their industries—whether as suppliers or users.
§ It would not require Ofcom to act on the consultation, but to give network and service providers the opportunity to participate in the regulatory discourse would help to ensure that the industry's regulatory regime would more accurately reflect the needs of communication providers.
§ Amendment No. 32 is intended to enhance the industry's ability to co-regulate—to promote the maintenance of a self-regulatory function by the industry with hack-stop powers for Ofcom. I ask the Committee to note the use of the words, "offer adequate opportunities", and, "as appropriate". The last thing that I should want is to impose a requirement on a self-regulatory body to report to Parliament.
§ I understand the purpose of Clause 6 as being to promote a range of regulatory mechanisms, including co-regulation or, as the Joint Committee called it, accredited self-regulation. I further understand that to mean that any opportunities to expand the frontiers of self-regulation would be taken.
§ I presume that Members of the Committee who will speak to Amendment No. 33 will have more to say about accredited self-regulation. My point is that those involved in self-regulation are not necessarily free from obligations to transparency and accountability. It is reasonable to write those principles into the Bill to allow for any such future developments.
§ The amendment would merely allow Ofcom to consider what opportunities for accountability would be appropriate through it to Parliament and the Secretary of State. I beg to move.
§ Lord McNally
Amendment No. 33 is included in this group. As the noble Lord indicated, it allows us to discuss the pre-legislative scrutiny committee's ideas on self-regulation. It is a matter on which we agree with the Government. The Government stated that they wanted self-regulation to be extended wherever possible. We think that that is a very good approach and that those are good guidelines so far as concerns Ofcom and the whole communications industry.
I noticed today that the new chairman of the Press Complaints Commission has put forward seven points to improve self-regulation in that area. It is sometimes said that this House has no power. Yet I read this morning that the BBC has suddenly started to think again about how its accounts might be subject to the scrutiny of the Public Accounts Committee. Today the new chairman of the Press Complaints Commission has come forward with some bright new ideas about self-regulation. I cannot think that these new thoughts from those bodies are entirely divorced from the fact that we are busily working on this business at present. We should be very encouraged to find that our endeavours are causing rustlings in the undergrowth in various parts of the forest.
1064 On this amendment, we think that, for self-regulation to carry the credibility it needs. Ofcom should be able to set down guidelines on proper self-regulation, against which the public and the sectors concerned can measure themselves. Accredited self-regulation is certainly not what, I think, was termed "a slippery slope to state control" in any of the sectors. It is exactly as the amendment suggests. It sets broad guidelines by which both the industry and the public can judge how a self-regulatory body goes about its business.
The whole idea of this amendment is to try to push forward so far as possible the concept of self-regulation. Here we stand shoulder to shoulder with the Government. It is far healthier for all sectors of the communications industry, and for relations between the sectors and the Government. We already have a good example of self-regulation working. I see the noble Lord, Lord Borrie, moving in his seat. I hope that he will contribute to the debate. The Advertising Standards Authority, now chaired by the noble Lord, Lord Borrie, has set a good example of how a body can be respected by the public and the sector. I understand that the ASA is in discussion with Ofcom, and I hope that it can conclude those negotiations successfully. That would set an example to other parts of the communications industry.
§ Lord Puttnam
I rise to support the noble Lord, Lord McNally, and to prove that the "Gang of Four" are as one.
As with so much during the work of the Joint Committee, the concept emerged from evidence. It was not dreamt up. Much of the evidence that we took was dispiriting, but, in this area, the evidence was overwhelmingly positive. We became very enthused. The purpose of the amendment is to say to the Government, "Please don't hope passively for self-regulation to emerge. Why not actively grab it? You have the ball at your feet". The idea of accredited self-regulation is neither odd nor particularly new. It is an idea in the wind, and it gives the Government the ball, so that they can get cracking with a new, more enthusiastic and determined form of self-regulation.
The noble Lord, Lord McNally, is right. We have the best possible example represented on the Benches behind the Government. My noble friend Lord Borrie and the Advertising Standards Authority provide a superb example of what is possible. What we say here tonight will be heard in places such as the Press Complaints Commission. The Government must evince determination to support forms of self-regulation and the sense that it is the way of the future. Whatever we say tonight—whatever the Government say—I guarantee that, 10 years from now, self-regulation will be the norm, not the exception. That is the direction in which things are going, and accredited self-regulation must be the answer.
We did a lot of work looking back at how, over the past 10 or 15 years, various professional bodies had, with enormous pain, come to terms with the fact that they had to get their act together and become more transparent. It is not surprising that professional 1065 bodies go through that pain barrier, but here is an opportunity for the Government to help them by promoting the concept of self-regulation. We are not suggesting tonight who the accreditor should be. Different bodies could be accreditors for different industries. It is a great idea, and the Government would do themselves an enormous service by enthusing about it and promoting it. The important subsections are subsections (4) and (5). They make the point. Without those subsections, the clause is limp; with them, we can point out clearly the way ahead.
I must also say that the words "monitoring and" should be removed from proposed subsection (3)(d). That role already exists, and it would be inappropriate to the suggestion that we make to include the monitoring component. I urge the Government to take the rest of the amendment seriously. They would do themselves and the nation as a whole a great service.
§ Lord Borrie
I shall speak only to Amendment No. 33. I declare an interest as chairman of the Advertising Standards Authority, which adjudicates—and has done so for a long time—on non-broadcast advertisements, to determine whether, because they are misleading or seriously offensive, they should be banned.
Amendment No. 33, put forward by the "Gang of Four"—if I may use that expression—for our deliberation, deals with guidance from Ofcom on standards for effective self-regulation. Generally, the objectives of those standards are set out in subsection (3) of the proposed new clause. They seem to me to be sound. I had some reservations about subsection (3)(d), but my noble friend Lord Puttnam said that the words "monitoring and" should not be included, so I shall read the paragraph without them. It says that the objectives are,that the person or body responsible for…enforcement of the method of self-regulation has an appropriate measure of independence from providers of the relevant service".I trust that the noble Lord, Lord McNally, will forgive my being pernickety. It was not the Advertising Standards Authority but a task force chaired and led by the Advertising Association, which has been in discussion with Ofcom over a period of time, that proposed to Ofcom a self-regulatory scheme for the control of broadcast advertising; that is, advertising on radio and television. The Advertising Association task force has included advertisers, agencies, broadcasters and so forth. As Members of the Committee have already said, the model it put forward is explicitly modelled on the existing Advertising Standards Authority.
This existing system, comprising an adjudicatory body with a majority of non-industry people, is independent. I am grateful for those Members who said that it is well regarded. It certainly has a good basis of finance, with the Advertising Standards Board of Finance levying a 0.1 per cent impost on advertising billings so that—although anyone in my position would say that we never have enough money to do our job—we have been well-resourced.
1066 My noble friend Lord Puttnam perhaps is withdrawing the word "monitoring" from the amendment, but "enforcement" under the non-broadcast system run by the ASA is partly done by the industry itself; namely, the Committee of Advertising Practice, a federation of trade bodies representing advertisers, agencies and the media. The ASA's adjudications are accompanied by publicity and by the requirement to withdraw the advertisement and not to repeat any advertisement which has been found to offend against the rules. If necessary, in relation to a recalcitrant advertiser, the ASA will report the matter to the Office of Fair Trading which, being a statutory body, has legal powers to take action for an injunction under the control of misleading advertisement regulations.
I have a reservation about subsection (3)(d) of the proposed new clause. However, the existing system for non-broadcast advertising also gives an enforcement role to the industry—to the Committee of Advertising Practice—working with its member associations, which includes media associations, in order that they are warned by so-called "ad alerts" that a particular advertiser and a particular type of advertisement should not be permitted. Similarly, the Royal Mail, which is a part of the Committee of Advertising Practice, will withdraw its bulk mail discount from an offender.
I am speaking about self-regulation of non-broadcast advertisements. It seems neither surprising nor a matter to be criticised that the industry itself takes a hand in the matter of enforcement. I do not know and would not presume to tell Ofcom what the best arrangements may be for monitoring or enforcing any self-regulatory control scheme which it devises or accredits for broadcast advertisements in due course. We may be a little unwise if we prescribe in this Bill who or what kind of body does the enforcement. Independence, referred to in paragraph (d), is vital for any adjudicatory body, but in terms of enforcement there could be a mix of ways in which this is done. If the phrase self-regulation means anything, it surely must mean that the industry itself helps to do the enforcing.
§ Lord McIntosh of Haringey
We have built many measures into the Bill to ensure that Ofcom will not only be a good regulator but also a promoter of self-regulation. Clause 6 is an example of that, as it is about the obligation on Ofcom to review any regulatory burdens.
I shall begin with Amendment No. 31, which requires Ofcom to seek the views of business on which of its functions should be reviewed. It is important for Ofcom to have a strong dialogue with business, but it should be wider than that proposed in this amendment. Clause 6(2), which Amendment No. 31 would amend, is not about which functions Ofcom should keep under review—indeed, subsection (1) requires it to keep all of its functions under review so that it does not impose unnecessary burdens.
1067 We do not expect that Ofcom will be able to fulfil its duties under subsection (1) without input from a wide range of stakeholders. Clearly, that will also involve business. However, the interests of business are not necessarily the same as those of other people to whom Ofcom will be talking. What appears to business as a burden might be a necessary protection for other people. Therefore, singling out business in the way suggested is not necessarily the right course of action. The amendment requires Ofcom to take the views of business, but not those of other interested parties.
The Bill puts in place formal consultation, impact assessments, and, under Clause 6(4), publication of a statement setting out how Ofcom proposes to secure that regulation does not involve imposition or maintenance of unnecessary burdens. I believe that to be more practical than the restricted obligation on Ofcom contained in Amendment No. 31. It will allow Ofcom to decide how it will comply with the duty.
Ofcom can use what we expect to be both formal and informal systems to build a clear view of what business and other people have in mind, not only in respect of regulatory burdens—the subject of Clause 6—but also other issues. We expect Ofcom to be listening to business right across the range of its activities, without the need for Amendment No. 31.
I turn to Amendments Nos. 32 and 33. I assure the noble Lord, Lord Puttnam, straightaway that the Government are not in any way reluctant about self-regulation. We specifically provide for self-regulation in respect of premium rate communications services, in codes of practice for dealing with customer complaints, and in the public service broadcasting provisions. Indeed, self-regulation is referred to specifically in Clause 3(3)(c) and, as I said, in Clause 6.
Amendments Nos. 32 and 33 relate to references to self-regulation in Clause 6. As the noble Lord, Lord Puttnam, will recognise, those references were inserted in the Bill in response to the recommendations of the Joint Committee. So both he and the Government can take credit for their inclusion.
We considered different models for self-regulation and decided not to mandate processes or codes, or, as suggested by Amendment No. 33, to lay down in statute the factors that Ofcom should consider—other than the question of whether there is sufficient independence and adequate funding. Of course, Ofcom will be able to consider other matters as well as assessing the effectiveness, or possible future effectiveness, of self-regulation.
We decided against accreditation—or what has been called "accredited self-regulation"—not because we believe, as suggested by the noble Lord, Lord McNally, that somehow this is a matter of going down the slippery slope to state control, which was not in our mind. We took that decision because accreditation is associated with defined standards. I should be interested to hear arguments on the other side, but we find it difficult to envisage a single standard that would apply to all the situations in which self-regulation could be used. The duties and considerations that are placed on Ofcom by the Bill provide a more practical and flexible framework.
1068 We are not so much laying down the process of selfregulation—the aim of Amendment No. 33—we are looking at the outcomes. I think that this is what my noble friend Lord Currie called "co-regulation"; in other words, it is an option for Ofcom.
The point to make here is that there are varying degrees of self-regulation or co-regulation. It will be for Ofcom to balance the degree of accountability, reporting, involvement and how hands-on it will be against the extent to which it will be able to remove or reduce regulatory burdens. However, while I have a great deal of sympathy for what has been said by my noble friend Lord Puttnam and the noble Lord, Lord McNally—as they both pointed out, we are on the same side on this issue—I think that it would be a mistake to lay down strict guidelines or objectives for Ofcom.
In itself, the amendment would not make self-regulation any easier. Indeed, there is a danger that it might add to the bureaucratic burden. Where there is self-regulation or co-regulation, it will be only where Ofcom has powers. I listened carefully to what was said about the Advertising Standards Authority and, while I agree with much of it, I rather suspect that praise for that authority is a surrogate for criticism of the Press Complaints Commission, which was not mentioned. Indeed, the innocent look on the face of the noble Lord, Lord McNally, confirms me in that view. We have repeatedly made it clear that Ofcom will not regulate the Press Complaints Commission, so I do not see how it could accredit that organisation.
For these reasons, which are entirely sympathetic to the purposes behind the regulations, but which seek to explain the thoroughness with which the Bill addresses these issues, I hope that the amendment will not be pressed.
§ Lord Luke
I am grateful to the Minister for that explanation. Although he spoke mainly to Amendment No. 33, which I shall not mention, it appears that everyone is keen on self-regulation in one form or another. No doubt we shall return to the matter at a later stage of the Bill. In the meantime, I beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.
§ [Amendment No. 32 not moved.]
§ Clause 6 agreed to.
Lord McNally moved Amendment No. 33:
After Clause 6, insert the following new clause—
"ADDITIONAL DUTIES IN RELATION TO EFFECTIVE SELF-REGULATION
(1) In considering for the purposes of section 6(2)(a) the extent to which matters which OFCOM are required under section 3 to further or secure are already furthered or secured, or are likely to be furthered or secured, by effective self-regulation, OFCOM shall have regard to the guidance prepared under subsection (2).
(2) It shall be the duty of OFCOM to prepare, and from lime to time review and revise, such guidance on standards for effective self-regulation as appear to them best calculated to promote effective self-regulation and the self-regulation standards objectives.
(3) The self-regulation standards objectives are—
(4) OFCOM shall make such arrangements as they consider appropriate for the accreditation of methods of self-regulation complying with the standards set out in guidance prepared in accordance with subsection (2).
(5) The Secretary of State may lay before Parliament an annual report giving an account of activities under a method of self-regulation that has been accredited in accordance with subsection (4).
§ The noble Lord said: The noble Lord, Lord Borrie, was quite right to point out that it is the Advertising Association which is in negotiation with Ofcom about extending the ASA system to broadcast advertising. I also take the point made by my colleague, the noble Lord, Lord Puttnam, about the words "monitoring and" in subsection (3)(d).
§ I mentioned the Press Complaints Commission only to praise the speech made earlier today by its new chairman, Sir Christopher Meyer. However, a challenge I find almost impossible to resist, but which I had not thought of at the time, was that made by the noble Lord, Lord McIntosh, when he said that it was not possible to apply accredited self-regulation to the Press Complaints Commission. I beg to move.
§ Lord McIntosh of Haringey
I did not say that; I said that accredited self-regulation required a degree of defined standards. However, the noble Lord, Lord McNally, is perfectly free to draw that conclusion if he so wishes.
§ Lord McNally
That is what I am doing. Bearing that in mind, we may come back to this matter on Report. I am most grateful to the Minister for making the suggestion. I beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.
§ Clause 7 [Duty to carry out impact assessments]:
Baroness Wilcox moved Amendment No. 34:
Page 8, line 45, at end insert—
( ) An assessment carried out under this section shall include an assessment, as appropriate, of the impact of the proposal upon the general duties of OFCOM and, in particular, the furthering of the interests of consumers through competition as set out in section 3(1).
§ The noble Baroness said: This amendment addresses the situation where Ofcom deems it necessary to carry out an impact assessment into the effects of a particular proposal it is planning to implement. The amendment states that such an impact assessment must include reference to how the proposal relates to Ofcom's general duties, and in particular how it would further the interests of the consumer through competition.
§ We welcome the impact assessment as a measure that will strengthen Ofcom's transparency. The wording of the Bill, however, provides Ofcom with a high degree of flexibility as to the form and content of such an impact assessment. Hence subsection (4) states that an impact assessment,
- "(a) may take such form, and
- (b) must relate to such matters, as OFCOM consider appropriate"
§ So while Ofcom may choose to set out how a proposal impacts upon its general duties there is no requirement to do so. Surely it is important, for the sake of transparency, for Ofcom to include reference in any impact assessment to how the interests of consumers are affected. I beg to move.
§ 10.45 p.m.
§ Lord Crickhowell
The clauses in this section of the Bill were not made available to the Joint Committee when it submitted its report. That is perhaps why there is no amendment on this occasion from the "gang of four". While I welcome my noble friend's amendment, I take the opportunity of noting what the Joint Committee said on the subject of impact charging when we agreed with the argument advanced by NTL and Telewest that,regulatory impact assessments must review the impact of proposals on markets as a whole, not simply on the companies that are the targets of the regulation".Prompted by the fact that the amendment has been brought forward, I have for the first time, I fear, read this clause. As my noble friend said, it is extraordinarily widely drafted to give the ultimate possible discretion to Ofcom as to what constitutes a regulatory impact. In the light of the fact that the Joint Committee did not look at this issue previously and that particular recommendation, we may need to examine the clause more thoroughly than simply in regard to the point raised by my noble friend.
§ Lord Puttnam
I support the amendment. It makes an important general point that will no doubt be raised later. I was delighted that the Government showed enthusiasm for an impact assessment but I am puzzled even more today than at the time of the Joint Scrutiny Committee when we asked the Government to 1071 commission impact assessments on cross-media ownership, changes in media ownership and cross-media and cross-platform promotion—issues which are tremendously important and, for the most part, not fully understood. The Government, I rejoice to say, have made almost an obsession of evidence-based policy, but they are making very significant changes to long-established policy without any attempt to create any evidence whatever.
§ Baroness Blackstone
I can be helpful in regard to the amendment. We shall resist it because, as drafted, it does not properly reflect the relationship between Clauses 3 and 7. In carrying out all its functions, Ofcom must comply with its general duties. The duties can apply only where Ofcom has functions; they are not free-standing objectives or principles.
Amendment No. 34 inverts the relationship between Clauses 3 and 7. An impact assessment can relate only to one of Ofcom's functions—which is subject to its duties—and not to the duties themselves. We cannot therefore require Ofcom to assess the impact of a proposal on a general duty.
We can consider, however, whether impact assessments should state how a proposal will fulfil the general duty. I am not promising that we shall bring forward an amendment on Report because I want to be clear that requiring Ofcom to include a reference to its general duties would be helpful to those who would benefit from an impact assessment. We shall look at the issue.
I also want to see what the amendment would add to subsection (4), which already enables Ofcom to consider what form an assessment should take and what matters should be included in it. I hope that on that basis the noble Baroness will withdraw her amendment.
§ Baroness Wilcox
I thank the Minister. At this late hour, to have such heartening news is a lovely way to end the evening, for me at any rate. I thank my noble friend Lord Crickhowell for his unexpected support, and the noble Lord, Lord Puttnam. After the Joint Committee supporting our Front Bench and the Minister almost giving me my amendment, I am not sure I shall sleep. However, I thank the Minister very much; I greatly appreciate the response and the offer of a rethink. I beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.
§ Clause 7 agreed to.
§ Moved accordingly, and, on Question, Motion agreed to.
§ House resumed.