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Column 1035What is special about British broadcasting and what is now at risk is the universal accessibility of the rich and balanced mixture of programmes to everyone who--over 12 months--pays a still modest licence fee of £1.20 a week.
That mix will not be provided by satellite television or by the other channels. I shall use advertisements for two television channels to make my point about quality. One was an advertisement for a cable television channel called BRA, which said :
"Round-the-clock classic film channel showing movies from the 30s to the 70s. Titles are scheduled several times during the year, so you can't possibly miss your favourites."
Another interesting example is provided by the description of a channel called LAN, which said :
"A totally new concept in television. Music from the world's greatest composers fused with visual images showing the beauty of the natural world."
That sounds rather like the old BBC intermissions which some of us remember seeing as children.
The mix of entertainment, information and education, of popular and minority programmes, has been the hallmark of the BBC. ITV eventually followed its lead. That it did so was due less to competition than to the threat by the IBA--sometimes made good--that, if it only chased ratings, it would lose its licence.
That quality is threatened principally by the Government's attitude to the financing of the BBC. The current linkage of the licence to the retail prices index is already squeezing out more than inefficiency. The Home Secretary's statement that the licence fee is not immortal indicates that he looks to subscription not--as he should--as a useful additional source of income to invest in programme making for the viewers, but as an alternative. The guarantee that the fee will last in its present form only until 1991 is a threat, the full consequence of which the right hon. Gentleman is plainly unwilling to reveal to the viewers.
It is hard to accept that the Home Secretary is speaking in good faith when he says that the BBC is the "cornerstone" of broadcasting, because, by his actions, he clearly intends to demolish it. He must know the limits of subscription as a means of revenue raising. Only two subscription services in the world make money--Home Box in the United States and Canal Plus in France, and both depend on feature films. British Satellite Broadcasting and Rupert Murdoch have announced their intention to go into that market. Even in respect of subscription the good faith of the Home Secretary is in doubt, because his proposal to hive off from the BBC one of its night channels will deprive it of an effective opportunity to develop what it has pioneered with its downloading night programme for doctors. If the BBC is to rely on subscription--all the evidence suggests that it has a limited capacity as a source of revenue raising--it will have no choice but to chase ratings. In that case there is a slim prospect for the survival of documentaries, investigative current affairs, classic serials, single plays, music and visual arts programmes and children's series, not to mention religious programmes. What would happen to the great orchestras of London, Cardiff, Glasgow and Manchester which the BBC support? Under a subscription system the BBC would disappear as the country's greatest patron of the arts.
The scope for revenue earning by BBC Enterprises is real and growing, but the Home Secretary should
Column 1036acknowledge that sales and subscription can never be more than a useful top-up of revenues if the BBC's role as the "cornerstone" of broadcasting is to be secured.
If the range and quality of the BBC are reduced, that will, of course, diminish the competition faced currently by ITV. Viewers do not want to watch trivial programmes all the time. Current viewing patterns show people's desire to have a mixture of what is relaxing and what is more demanding. That mix is not offered by multiplying channels. Nor do the promised schedules and expected costs of satellite channels such as Sky suggest that it will be possible cheaply to purchase a combination of programmes to match the spread of our present terrestrial channels. The White Paper does not offer real choice.
On competition, too, the White Paper is gravely defective. The Government appear to be bull-headed in their determination to stick to a tendering system of franchise allocation. I think that at best that is daft and at worst it is sinister. The Government have allowed a dangerous concentration of newspaper ownership in this country, but at least in that case there is always some possibility of a new entrant spotting a new market. As television franchises will be granted for many years the dangers of cross- ownership are far more serious. Television is also a much more pervasive medium than newspapers.
The White Paper that the Government ask us to endorse contains no adequate safeguards to prevent the domination of the networks by those with deep pockets and shallow concerns for freedom of expression and the virtues of diversity. The prospect that those who pay the piper in the press will also pay the piper across the airwaves induces revulsion and fear. The impact of the tendering arrangements and the role of the proposed licensing authority on the quality of programming will not be benign, even if the Home Secretary prevents the ownership of television channels by the press moguls. I believe that such ownership should be prevented.
We are asked not to underrate the significance of the quality hurdles in the way of franchise bidders. If consideration of quality has any meaning in the process, the Home Secretary must realise the force of the plea from the reconvened Peacock committee that the new licensing authority should have the right to reject the highest bid if another company offers more value for money in terms of the public interest.
It is a sad reflection of the Government's philistine intentions that almost the only deliberate obeisance which the Home Secretary makes to programme quality in his proposals is the enthronement of Lord Rees-Mogg as a censor and to extend, probably impracticably, the provisions of the Obscene Publications Act 1959 to broadcasting. The Home Secretary tells us that the one section of the White Paper that has green edges relates to Channel 4. The Government reject the current arrangements for that channel, offer three suggestions of their own and ask for others. The endorsement of the White Paper by a vote tonight will leave Channel 4 in limbo. I am glad that the Government are at least open to suggestion and that we will have the benefit of the recommendations of the Select Committee on Home Affairs before decisions are taken.
Channel 4 is a success story--in part the Government's success story. With clever scheduling and as a national channel, unlike the proposed Channel 5, which will reach only 70 per cent. of the population, it could have
Column 1037considerable power to draw in advertising revenue from other companies. Without some entrenched arrangements on complementary programming and without the promotion from the other channels enjoyed at present, it will be difficult for Channel 4 to draw in advertising revenue and to fulfil its remit. That remit to provide innovative programmes and cater for interests not served on other channels has not turned Channel 4 into a ghetto channel. It offers news, 15 hours of education, religious and multiracial programmes, American football, "The Business Programme" and the "Right to Reply". If Channel 4 has to compete for revenue without a concordat on scheduling with the other channels, it will have difficulty in surviving as we know it. Most of the new channels will be national, even international, in their coverage. Regional television is largely the creation of ITV and the regional strength of the new Channel 3 must, therefore, be underpinned. The right hon. Member for Kincardine and Deeside drew attention to the fact that the White Paper's proposals on regional television are singularly deficient. Regional television must serve regional interests and it is not just news and current affairs programmes that are required.
Regional television is seen at its best with fine programmes of broad interest that have been networked around the country but which have been made by talented production teams that enrich the lives of the many communities where they work. The White Paper pays some lip service to the importance of regionalism, but does not offer safeguards on the quantity and quality of regional programming. It offers no definition of what a "regional" programme is likely to entail and no protection from the media bandits. Such companies could easily become the shadows of their satellite owners. I agree with the right hon. Member for Kincardine and Deeside that cross-financing is vital for the small companies.
The present transmitter arrangements have sustained regional broadcasting in the less populous and geographically remoter areas by cross-subsidy. I hope that the Minister will fill in a blank in the White Paper concerning transmission costs. If there is no recognition in the legislation of companies' ability to pay to sustain the regional system, those remote places will not receive cable, Channel 5 or MVDS, and they will suffer the loss of access to regional broadcasting.
The prospects for broadcasting, which are again being widened by technology, could be immensely enriching for our national life, but the White Paper is singularly deficient in pointing up those possibilities. That is demonstrated by, for example, its suggestions about fibre-optics and cable. The White Paper is inadequate because it fails to recognise that cable regulation is in a mess. I think that, however, politicians should be as wary of over-reacting as of under-reacting to the opportunities.
There are many interests and enthusiasms that pay television can satisfy, but most of us have wide-ranging and general interests that are not simply the sum of particular pre-identified tastes. It is those broad requirements for which our system has provided so well, step by step, as talent has been harnessed to technology. That is in the Home Secretary's trust, but he has given
Column 1038almost no evidence of his awareness of that fact either today or in the White Paper. For that reason we shall not vote to endorse his proposals.
Mr. John Gorst (Hendon, North) : I have followed debates on this subject in this House since the 1950s. What is most remarkable about today's debate so far is that, although there is plenty of room for argument and disagreement, there is an enormous amount of common ground, which is evident on both sides of the House. That is a reflection on, and a compliment to, the fact that not only is our system well regarded abroad, but it is one in which we take considerable pride at home. Just as Parliament has never been keen on the divine right of kings, however, it should equally look askance at a divine right of commercial broadcasters.
While I accept a hereditary monarchy, I do not necessarily extend that to a hereditary ownership of the media. If there is to be any divinity around, it should belong not to the suppliers of programmes but to the consumers of them. Suppliers, after all, should retain their franchises on merit, and so as long as there is a quality threshold--which I welcome in the Home Secretary's proposals--I do not share the alarmist views of those who have spoken like Jeremiahs over the years since commercial television began.
This White Paper--indeed, any White Paper on broadcasting--must be judged against certain abiding criteria, and they have been forcefully spelt out by the Home Secretary as independence, choice, viability and, above all, quality. In this context, I mean by quality whatever is judged to be the best of its kind, be it sport, chat shows, drama, comedy or anything else.
But there are other considerations, and the range of programming, diversity and balance are among them. Account must also be taken of efficiency and cost-effectiveness. And somewhere in the system there must be a place for what I would call the culturally literate aspect--something that is both edifying and enhancing, not only from the past but from the contemporary scene. Without those elements, broadcasting could quickly become mediocre and ultimately sterile, and Britain's achievements, by our own or by world standards, have been prodigious.
I wish to concentrate on what a true Conservative approach should consider to be of paramount importance ; and in saying that I do not claim any exclusive monopoly on these Benches. It is just that on this side of the House we place a great deal of emphasis on preserving what has been learnt from the past and not destroying the good that has been created.
Thus, when we are thinking about innovations, we must do more than pay lip service to such notions, and in this context I shall concentrate my remarks on the position of the BBC. In many ways it is the repository of much that is best in British broadcasting. When I listen to spokesmen of the BBC speaking about the White Paper I have a strong sense of deja vu.
I am reminded of what the American Secretary of State, Dean Acheson, said in the aftermath of the Suez crisis, about Britain having lost an empire and not yet found a role. The BBC may not be said to have lost an empire, but it has lost its exclusivity over the years. Its funding is in jeopardy, and the basis of its funding must cause concern.
Column 1039Just as, in the 1960s, Britain's role was not clear in the new order of things, so in the present new order the BBC's role is not clear. For example, the BBC's role rests at the end of the day not only on what Parliament wills but on what resources it has available. In this context, I find the White Paper disingenous. According to paragraphs 3.2 and 3.3 on page 7, great things are expected of the BBC. We read that it has
"a special role. It will continue to be expected to provide high quality programming across the full range of public tastes and interests"
and so on. How is that to be achieved? Even if the BBC holds its ground, it is naive to think that it could hold it beyond 1996 on the basis of what it is trying to do now.
Equally disingenous is the BBC's response to the White Paper's disingenuousness. The BBC tells us--I am guided by a note which other hon. Members will also have received from the BBC--that its main function will be to improve efficiency, to broaden its revenue base, to make subscription television work and to generate interest in sponsorship.
Unfortunately, that begs the real question. What can the BBC achieve with the resources it has and will have? The BBC admits that subscription and sponsorship will do little more than cover the cost of those innovations. There still remains the cost of running the BBC, of paying for worldwide news networks and of other important activities that it has. Meanwhile, as each year passes and 1996 gets nearer, the licence fee will buy less and less and I question whether it will go up and up. However, it is certain that competition will get more and more expensive.
Something will have to give. Will it be the range of the BBC's services, its standards or both? On its dwindling income, it will have to redefine its scope of activities and therefore its role. Parliament should have a say in this, and we should be facing up to that now. The role of the bastion of public service broadcasting is not an issue to be left to market forces. If we leave it in that way, we may have left matters too late. What we should have preserved may have been dissipated and what remains may not be what we would value most. In short, we may have to face in 1996 a fait accompli. If these questions must be faced now, I hope the Government will think again about what is said in the White Paper on page 10, where at the end of the section on the BBC we are told baldly : "It will be necessary to review the role of the BBC when the present Charter expires at the end of 1996 Experience needs to be gained first of the progress and impact of the reforms".
I fear that that could be addressing the matter too late. I have a suggestion about what the role of the BBC should be. I do not share the view of Professor Peacock as expressed in The Times today :
"the major purpose we saw behind the move to subscription was to prepare the BBC for the day when it would compete on equal terms with the present independent sector."
He goes on :
"When the BBC's charter expires in 1996 the case for a special relationship between the BBC and the Government would disappear. It could become an independent company like any other".
I do not accept that. A free market can only result in the uncommercial being bypassed and buried. But that burial does not prove what it may seem to prove ; it does not follow that what the free market has killed off was worthless. Something which is unprofitable is not
Column 1040necessarily unrewarding or without merit and we should not be so undiscerning as to think it is. The premise on which I started is that there are and always will be--
Mr. Gorst : There are and always will be programmes that commercial enterprises cannot or will not undertake. The BBC should become a forum for excellence--not a broadcasting ghetto but a jewel in the crown of the British media.
Mr. Jack Ashley (Stoke-on-Trent, South) : I agree with the hon. Member for Hendon, North (Mr. Gorst) that the funding of the BBC is a matter for concern. It is one of the two issues that I want to raise today. I think that we all accept the need for change because of technological, international and other developments. However, the changes proposed in the White Paper would damage the BBC. Rather than opening doors, some of them will close doors and I am strongly opposed to them.
I was a television producer with the BBC for eight years and I have some experience of the problems that it faces. I have great admiration for the values, quality and output of the BBC. However, those qualities will be jeopardised by the proposals in the White Paper to end the licence fee and replace it with subscription television--that is the essence of the proposals.
The BBC has made an outstanding contribution to Britain and to the world with its quality, expertise, experience and public service standards, but those would all be slowly suffocated if the proposals in the White Paper became law. The danger signals are flying high and clear, and despite the euphemisms in the White Paper the menace is glaringly obvious. All the fine words in the White Paper about the BBC's special role and its high quality programmes cannot disguise the harsh fact that the BBC will be deprived of the cash that it needs to continue. The licence fee will be squeezed until 1991, and after that the Government clearly want to replace it with subscription television. That is like trying to run a Chieftain tank on lighter fuel--it simply will not work.
The House should be in no doubt that if the BBC is compelled to exist on money from subscriptions, sponsorship and other entrepreneurial activities, the BBC as we know it will not survive. Not only is the quality of the BBC jeopardised--its very existence is threatened by the White Paper. We should be under no illusion about that. Subscription television would devastate the BBC's finances. Anyone who doubts that should calculate how many old age pensioners could afford it, especially as 80 per cent. of old age pensioners live on or around the poverty line. How many of our millions of unemployed people or one-parent families would be able to afford subscription television? A glance at the financial problems of the many millions of poor people in Britain reveals that it is absurd to suppose that subscription television will permit the BBC to survive. It would reduce the BBC to a ghetto--a refuge for minorities--and would mean the destruction of the BBC as we know it. I urge the Government to continue to provide the BBC with an adequate licence fee so that it can continue its admirable service.
Column 1041As president of the Royal National Institute for the Deaf, my second point is that deaf viewers' needs are often overlooked. Television is crucial to our way of living and thinking, and to social intercourse. It does not merely provide entertainment--it plays a crucial role in society. Deaf people can easily become isolated because of their handicap. Television provides them with a means of integration by virtue of its coverage of virtually every aspect of our lives, but many deaf people cannot follow television without the help of subtitling or signing. Subtitling can be provided on a teletext service which can be watched by deaf people so it does not interfere with the picture seen by the general public. In the long term, so-called "open" subtitling or signing could be considered but I favour subtitling on teletext for deaf people so that it does not interfere with the viewing of the general public.
The technical facilities for full participation by deaf people in television are available, but the television authorities fail to provide the necessary coverage. There are 70 hours of television per day and 490 hours per week for hearing people, but deaf viewers have only 30 hours of subtitling on BBC and 25 hours on ITV. Those figures are shocking. Deaf people are being let down by both the BBC and ITV. That must change. Ministers must appreciate that deaf people will receive properly subtitled programmes only if the Government will it. There is no substitute for the will of the Government. No one can doubt that deaf people will be ignored if television is seen merely as a marketable product. It is essential for deaf people that legislation should specify that franchises be given only-- I repeat only--to companies which provide an adequate number of hours of subtitled and signed programmes. The number of such programmes should be increased and a higher standard set. The cost of subtitling is now about £300 to £400 per hour--a tiny cost to television and one that could be reduced by improved methods and greater use of live subtitling.
Those who insist on perfect subtitling before it is permitted on the screen are damaging the interests of deaf people. Whatever the spelling errors, or the minor delays in subtitling, the service constitutues a phenomenal advantage for deaf people. ITN deserves the warmest congratulations from the House for pioneering live subtitling on the 6.45 pm and 7 pm news, which provides a godsend to deaf people and is warmly appreciated. The BBC's attitude of seeking perfection before providing live subtitles is lamentable and it must catch up with ITV, which has left it standing. The Government, the BBC and ITV must change their attitude towards subtitling, which is a lifeline for deaf people. The rewards for deaf people are enormous. I make a special plea for Ministers, the BBC and ITV to expand subtitling and to open television to millions of deaf people all over Britain. 7.30 pm
Sir Geoffrey Pattie (Chertsey and Walton) : I am sure that the right hon. Member for Stoke-on-Trent, South (Mr. Ashley) will forgive me if I do not follow him into that area of debate. No one is more qualified than he to speak on those matters and I am sure that every hon. Member has admired his courage and fortitude for many
Column 1042years and has noted with regret and sadness his announcement that he will retire at the next general election.
I declare an interest as a non-executive director of Collett, Dickenson, Pearce advertising agency. When I read the White Paper for the first time, I was amused to see that it proposed a levy because, apparently, no self- respecting White Paper is worth its salt unless it contains a levy. One must, of course, recall that the levy was introduced originally because the use of air time was deemed to be "a monopoly exploitation of a scarce public resource".
Now we have an infinitely wider availability of that previously scarce public resource and there will no longer be a monopoly because competition is the name of the game and we shall have lots of it. One cannot help noticing that this time the levy will be exacted on the income rather than the profits of the independent companies, which will put great pressure on them.
I believe that there is one central proposal in the White Paper that is dangerous and one major omission. Much of the criticism of the White Paper centres on the method of allocating the franchises by auction, especially when it is stated that the ITC will be required to accept the highest bid. The Government recognise that they cannot simply invite bids from all and sundry without regard to the companies' suitability and, therefore, certain pre-conditions are imposed, so already, at the first stage, we are moving away from the purest market force form. Pure market forces would require no screening or filtering process before the auction. There is to be a quality threshold. The question is how high the qualifying bar will be set. Will it be set at a height of 1 ft 9 in, thus enabling most to qualify, or will it be a stiffer test but one that, none the less, depends on the companies honouring their promises in later years to provide, for example, a diverse range of programmes and also to take national news networks, as they have to at present?
Once the quality threshold has been crossed, companies will proceed to the auction. The White Paper says that the ITC will be required to accept the highest bid. That cannot be sensible. If the ITC is required to accept the highest bid it can, by definition, take no notice of the fact that, for example, one company triumphantly met the quality threshold criteria and a rival company just scraped through.
I was for some considerable time the Minister in charge of procurement in the Ministry of Defence, operating a policy of competition. We were after the best price that we could obtain, but we never circumscribed ourselves by insisting that we took the lowest price--which is the same principle that we are addressing here--regardless of any other consideration that might apply. The same applies here when we are talking about the highest bid regardless of other considerations. The widespread concern is that the higher the bid, the greater the pressure on the winner to cut costs and corners and the supreme short-cut is the route being demonstrated now by Sky, with American and Australian game shows and tabloid style news services.
There is much that is good on our television. Some of the more imaginative and expensive series such as the various wildlife programmes would be under pressure if costs had to be held down. Could the wildlife programmes themselves become endangered species? There is a danger that, in the desire for choice, the Government are confusing qualitative choice with a mere proliferation in
Column 1043the number of channels. A large number of channels putting out American and Australian chat shows, which are largely
indistinguishable from each other, do not meet my criteria for genuine choice. The provision--or at least the possibility of provision--of quality on our televisions is essential and that is much more likely to come from the selection of franchisees who meet the criteria and put in a good bid, but not necessarily the highest bid. We must remind ourselves that we and the Government act as trustees as much of our culture as of our physical environment.
There are other difficulties attached to the question of the highest bid. It is conceivable that in the first round of the auction some of the bigger players might hold back from the bidding process and wait to see whether one of the successful companies had overreached itself and had therefore made itself commercially vulnerable to a takeover. I suspect that the Home Office may already be considering some kind of moratorium on takeovers, which would be a good move and another restriction on market forces in their purest form. Perhaps when my hon. Friend the Minister of State replies he will tell us whether it is possible that if a would-be franchisee put in a bid that happened to be more than 25 per cent. of the net asset value of that company that would constitute a class I transaction which would require all the shareholders to be notified, thereby making a company's bid public at that stage--which might produce many problems.
The one major omission of the White Paper concerns training. It is one of the critically important subjects about which one does not need to say a great deal because all hon. Members apparently recognise it when we see it. As my right hon. Friend the Prime Minister said in November 1988 :
"effective investment in training is crucial to business success." It is impossible to overemphasise the importance of training. Training must be provided by the employers, but to be absolutely blunt about it, it will be provided only if the employers are required to provide it. Such a requirement should be inserted in the process at the quality threshold stage when would-be franchisees are running about making all the appropriate noises. At that stage, some mechanism must be inserted to ensure that adequate training is made available. It will not be satisfactory to rely on the BBC to provide all the technicians and producers for the whole industry and it would be extremely unfair and unrealistic to expect that to happen. In the White Paper, the Government correctly recognise the challenge and opportunity of new technology and they also, rightly, emphasise the importance of choice. I do not believe that the real implications of choice for the independent television companies and for the BBC licence fee have been fully thought through. There is certainly no reason to have a levy and a mandatory highest bidder auction. That is illogical. It is also somewhat disingenuous to suggest that regulation, including the Broadcasting Standards Council, will be a light touch. I give the Government five out of 10 for effort on this White Paper, adding the rider "more thought needed." 7.39 pm
Column 1044hon. Member for Chertsey and Walton (Sir G. Pattie) gave the Government a score of five out of 10. I am not so generous. The history of this Government and broadcasting can best be described as one of missed opportunities. They have failed to realise that there is a broadening base in the entertainment world and a difference in taste which is not based on socio-economic groupings.
In his recent surveys, Professor Arenburg found that a certain percentage of the best paid watched a certain percentage of serious programmes and another percentage of what might be called comedy programmes. The only trouble is that throughout the socio-economic scale the percentage watching serious programmes remained exactly the same and the percentage watching game shows and other amusing programmes was exactly the same. So it appears that human beings watch a variety of television.
Some years ago the start of new technology, new ideas and the new broadening of the entertainment media gave the Government a wonderful opportunity. We had the Cable and Broadcasting Bill. The Minister of State was not the Minister in those days. I cannot remember which Department he was in. That Bill was run by the Department of Trade and Industry. As it quietly proceeded, the then hon. Member for Gravesham, Mr. Tim Brinton--a man for whom I have infinite respect--tabled an amendment in Committee which I supported. It deregulated cable. The Department of Trade and Industry took five years to wake up to what we had done. In those five years the Department made certain that the British cable industry was strangled and did not expand.
We then had the Films Bill to get rid of the old National Film Finance Corporation. We fought against it in Committee because, in effect, it was to begin to throttle the film industry.
Mr. Bermingham : The hon. Gentleman says, "Oh". If we had had some of the tax and investment incentives that exist in other countries, the actors, technicians and talent that we have in this land of ours could have mass produced films which could have been made available on television and in cinemas throughout the world. We have a mass of talent and expertise which we have singularly failed to develop and use.
We should look at the television world of tomorrow and say, "This is an opportunity. It is not something to run from like scared rats leaving a sinking ship." We should face the real world and realise that there is a subtle difference between terrestrial and Sky channels. We should not seek to apply to terrestrial broadcasting what we seek to apply to Sky broadcasting. To put it bluntly, there is no way that we can stop Sky coming down. If we think that it is going to be rubbish, we must ensure that terrestrial programmes are so much better and easily available that people will choose them. Choice is interesting. It has taken nearly eight years for Channel 4 to penetrate to 9 or 14 per cent of the market. There is a terrific market loyalty. Let us not be scared of this thing called Sky --this thing that is to come from the heavens. There are only about 1,000 dishes and the Government have ensured that we have not even started to cable anywhere yet. Therefore, Sky cannot link with cable, so most people cannot watch it for many years. Market penetration will take time.
Column 1045Let us put to one side this notion about Sky and take out of broadcasting the cold claw that seems to grip the Home Office from time to time as the DTI stretches its dirty little arm into the heart of the broadcasting industry. The DTI does not understand a fig about broadcasting, and the sooner we accept that and the sooner Home Office Ministers say to their DTI colleagues, "Off boys, broadcasting is our patch and we are keeping it that way", the better. The minute the Home Office starts to do that, we may begin to get some sense. I am all in favour of the fifth and sixth channels. I accept that the fifth channel must be commercial. As I said earlier to the hon. Member for Westminster, North, I hope that the Government will keep their hands off BBC1 and BBC2 night hours. I wait with great expectancy for the Minister's confirmation of that later. If those two channels are to develop a 24-hour system, they must be left their night-time hours. Those channels must be left to the BBC to develop in its own way.
The Government intend to re-franchise the ITV stations. My constituency is in Granada's territory and we have an excellent television service. If the Government are to set up a franchising system that goes to the lowest common denominator and sacrifices standards in the interests of an extra buck or two in the fee, I have to say, "For goodness' sake--don't." In effect, they will destroy local programming, local interest and local programme making. Existing ITV franchise holders have served the industry well. Let us not be frightened of saying that. Expertise and talent have been built up and should be protected.
I would not be unhappy to see existing franchise holders offered further contracts. The Government may wish to increase the amount that they pay on the contracts, but at least the companies--the nuclei, the talent teams, the production teams, the technicians and other staff--would be kept together. I do not mind if the new regulatory channels have a yellow card and red card system. If a company falls down on its quality standards, let it be shown the yellow card and make the regulatory authority strong enough to give it the red card if it continually falls down--the red card that would send it out of the business and let someone else in. There will be other franchise areas to develop in the fifth channel, for which new companies can tender, but let us not, merely for the sake of change and new ideas, throw away nearly 20 years of talent and development. That is the risk that we run.
I do not propose to take long today because what I have to say I have said many times in the past. Once upon a time we thought and it was argued that the development of the entertainment industry via the cables of the land would be the way in which this land was to be cabled. I said then, I say now, and I say to the Minister once again, that cable--the development of fibre optics and the various junction systems that come with it--is not just a march down the path to further choice in entertainment, but the basic structure for the future of an industry which is yet to be born and developed. It is an industry by which information transfer can be made readily available throughout this land. It is a way in which we can pass ideas and products. It is the industry of tomorrow.
By restricting cable, because it was tied to the concept of its being entertainment-led, the Government may well
Column 1046have cost us our place in that market. But it is not too late. I appeal to the Minister to look again at cable, give it a chance, give it the incentives, get the lines in and the system set up. They will find that it is not people who want to use it to watch television, but business men who want to use it to transmit information and technology. Let us not miss that boat.
Sir Geoffrey Johnson Smith (Wealden) : I agree with the last comments of the hon. Member for St. Helens, South (Mr. Bermingham). As a non-executive director of London Weekend Television and a superannuated, somewhat faded television interviewer-- [Hon. Members : -- "Never."]. I am most grateful for that disagreement with my immodest statement. It was long ago and I must face reality, as others will in due course. I am sometimes asked for my views on television. On this subject I am often asked, "Why on earth are you mucking about with it?"
On the whole, people are reasonably content with the limited choice that we have. It is more limited than we sometimes realise. Nevertheless, people are content with such choice and quality as they have. Although I believe that we are capable of doing greater things, I have some sympathy for them. Why dig it all up again? One of the reasons why I welcome the White Paper is that it recognises the reality that television is technology-driven and it makes clear, most excellently I think, that changes in technology-- satellite broadcasting in particular--change the environment, which means that the existing framework must change, too.
So we have got to make a good job of this, and I believe that it is perfectly possible to give a reasonably warm welcome to the White Paper for making a good fist of it. I am not going to say whether it deserves five, six or seven out of 10, but my hon. Friend the Minister of State and the Home Secretary have done as good a job as any lot I can think of around the Palace of Westminster.
Unhappily--and here comes the rub for my hon. Friend--the White Paper does not fully recognise the financial impact of its proposals on the existing ITV channels. It makes much of the need for programmes of high quality and for choice. However, in three ways, the Government, by the introduction of the new levy in 1990 and by at least two of the proposals in the White Paper, could frustrate those worthwhile objectives. It could do so, first, through the tendering system, which has some of the characteristics of an auction ; secondly, through the introduction of the new levy, which comes into force in 1990 and will penalise the ITV programme-making companies ; and thirdly--and this has already been referred to--by completely separating Channel 4 from the ITV companies, and thus breaking an association that has done much to ensure the success of Channel 4. Breaking up that association will further fragment the television audience.
I should like to deal with that last point first. Fragmentation will arise anyway through the creation of new advertising-financed channels such as Channel 5, as well as the numerous satellite channels, and these alone will shrink the revenue of the present terrestrial TV companies--a point that is considerably underestimated in the White Paper. So, Channel 4, which we must prize, will be on its own and will have to compete with the other channels for advertising revenue, the acquisition of
Column 1047programmes, artists and writers, without any further support from ITV. Its costs will go up, and separation will also end complementary scheduling of programmes, which provides the quality and the choice that are such central features of the White Paper.
I hope that the Government will, as they suggest in the White Paper that they might, look again at the future financial status of Channel 4, as well as its relationship with other companies.
On tendering, it is only right that a private company should expect to pay a price for a 10-year franchise. I do not think anyone should quarrel with that, and I do not think that anyone in the ITV world quarrels with it. However, the method proposed in the White Paper will, I have little doubt, encourage unrealistic bids, and I hope that the new ITC will be given the power to exercise its discretion to award the franchise not to the highest bidder but to the bidder offering the best value for money. I will not develop the point any further because it was most ably made by my right hon. Friend the Member for Chertsey and Walton (Sir G. Pattie).
The levy, which will be introduced in 1990--three years before the new franchises--will, in fact, impose an additional financial burden on the ITV companies, a burden much heavier than that imposed by the present levy. It will be imposed at a progressive rate on turnover instead of profits as it is now. Certainly it will hit the larger companies which make most of the programmes that are networked on ITV. Furthermore, it will hit them disproportionately--and at a time when they should be making more, not fewer, programmes to face the new competition from the other channels.
Of course, a levy was originally introduced--and quite rightly so--to siphon off the excess profits made by ITV companies operating in monopoly conditions. But after 1993 the situation will change radically, and the levy should be abandoned if the Government want the ITV companies to compete with programmes that provide genuine choice and genuine quality. The ITV companies themselves do, however, have a choice to make if the Government do not heed the warnings that they have had from outside the Chamber as well as from many hon. Members who have spoken in the debate. If they do not modify the levy or the proposals in the White Paper to which I have alluded, the alternative is a simple one : the ITV companies could simply fly away, and they could take out a licence to transmit their programmes from one of the international satellites' transponders.
At a stroke, as my hon. Friend the Minister of State knows, those ITV companies--well-known companies--will not have to pay any levy, there will be no tendering costs, there will be no need to subsidise the Welsh television channel, there will be no residual public service obligation, no transmitter subsidies which would be necessary if they stayed on the ground, and no control over the time spent on advertising. Of course, with the companies would go their talent and ability to make programmes that are still of quality and are widely accepted and viewed by the British public-- programmes which, as one sees from the top ten any week, beat American production hollow. The commercial attractiveness of that option, although obviously dependent on satellite dish technology and the costs over the next four years, should not be underestimated by the Government. I hope, therefore, that when the Minister replies he will take into account the
Column 1048points that I have made, which I am glad to say put me in good company because they have been made from both sides of the House. 7.57 pm
I urge the Government, if they are in any doubt, to appreciate the tremendous significance of the course on which they are now embarking. I probably speak for most people when I say that I am almost in awe--perhaps "fear" is a better word--of the potential power of television in our lives. Let us look at the penetration of television--"penetration", I think, is an advertiser's word. Virtually every household in this country has access to television. Indeed, more than half of them now have at least two sets. The viewing figures show that the average individual watches television for between 25 and 30 hours a week, which is longer than we spend doing anything other than sleeping--or working, in the case of those lucky enough to have a job. That is an indication.
It is not just the viewing time that is significant. It is also the time that we spend discussing, in pubs and clubs and amongst ourselves, what we have seen the night before. The potential impact of television cuts across social classes and age groups. It is absolutely enormous, and the audience sizes are staggering. At peak times the audience can be 20 million. I am sure that hon. Members on both sides of the House will understand when I say that, like most politicians, I am well used to addressing mass audiences of 20 in village halls. The idea of speaking to 20 million people is quite mind-bending.
I look in vain when I try to see what kind of philosophy lies behind the Home Secretary's proposals. It was a great indication of how mistaken his present view is, and of how distorted is his picture of the future, when he described his philosophy in a speech on 18 January this year in these words :
"Increasingly, the viewer and listener should feel like someone browsing in a good bookshop rather than someone kicking their heels in a ration queue."
All I can say is that if his image of the 20 million who watch at peak times is an image of people kicking their heels in a ration queue he has a profoundly distorted picture of the present situation. If the Home Secretary's view of what he has in store for us is browsing in a good bookshop, he must go into very different book shops from those that I visit. Hon. Members should not take my speculative word for this. As the great saying goes, we should look not in the crystal ball, but in the history books.
Let us consider what the deregulated system is providing at the moment. In The Independent on 1 February, Michael Grade referred to Sky's entertainment channel as follows :
"Sky's Entertainment channel looks like yet more re-runs and failed American and Australian series It looks like endless cheap buy-ins from abroad I don't see where the new choice is. So much of their schedules are junk, fast-food takeaway telly which programmers put on in the hope that viewers will not notice This is less a broadcasting revolution than all our yesterdays."
Mr. Grade was talking about the system that operates now.