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Lady Olga Maitland : That is a cheap comment.

Mr. Rogers : It is not cheap. If ever a person was supported by and received help from a political party, it was Asil Nadir in his business activities and the way he related to the nexus of politics and trading in the near east. Mine was not a cheap remark : I was saying that many Conservatives had strong connections with Asil Nadir, so they do not come to the problem in a clean state.

Lady Olga Maitland : How would the hon. Gentleman respond to the fact that Serbs from Belgrade and Bosnia used banks in Greek Cyprus to launder their arms-dealing money ?

Mr. Rogers : The hon. Lady is perhaps an expert on the laundering of money in the middle east--if one can make Bosnia and Croatia a part of that --while I am not particularly expert. The hon. Lady has obviously made a great study of that area.

Mr. Asil Nadir was a fugitive from justice in this country and was entertained and was welcomed back in the

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illegally occupied part of northern Cyprus. There is no way that the Turkish Government will transport him back to this country. He certainly had a great deal of influence on certain members of the

Sir Jim Spicer : Will the hon. Gentleman give way ?

Mr. Rogers : If the hon. Gentleman wants to speak, he can follow me in the debate.

The hon. Member for Wellingborough also said that northern Cyprus has no friends while the southern part, the Republic of Cyprus, has all the friends. That is fairly natural--if they are in the right and northern Cyprus and Turkey are in the wrong, naturally the world community will support those people who have suffered an injustice and whose land has been invaded by foreign armies.

Sir Peter Fry : Does the hon. Gentleman not accept that, while the minority Turks feel that their future is threatened and they are not given a degree of security, they will never be very willing to make a long-term settlement ? Is that not the element that has been missing from the hon. Gentleman's speech and those of his hon. Friends ? There has to be some guarantee. Does the hon. Gentleman agree that, unless the Turks receive that guarantee, we may be debating the subject for many more years to come ?

Mr. Rogers : I agree entirely with the hon. Gentleman--in fact, I was going to come to that point. He said that we needed to be even-handed in our approach to the problem. He is right to say that guarantees must be made to both communities. My hon. Friend the Member for Tooting said that his interest was in Cypriots--not Greek Cypriots or Turkish Cypriots. Any solution that is to be brought about by the mediation of the United Nations has to be fair to both communities. That was why President Clerides recently made the offer that if northern Cyprus was prepared to demilitarise its area and Turkey was prepared to withdraw the 30,000 troops, he would disband the national guard. The whole of the island of Cyprus could become demilitarised, with a return to normal policing so that people in each of the communities could feel secure in their homes and properties.

It has been 20 hard years of diplomatic effort towards achieving a settlement. It is my considered opinion--I do not come to the argument from either side--that it is the Turks who have been intransigent in the negotiations. As my hon. Friend the Member for Tooting said, Mr. Denktash seems to be continually moving the goalposts.A study of the detail of the negotiations under the United Nations representative, Mr. Clarke, and an examination of his work over the past 18 months show that, at the end of the day, the difficulty has always been Mr. Denktash.

Mr. Derek Enright (Hemsworth) : The Turkish army is supposedly defending human rights, but should we not consider Turkey's own record on human rights in relation to the Kurds or, indeed, even Manchester United supporters ?

Mr. Rogers : My hon. Friend has made his point. I do not want to go down that road because of restrictions on time and the fact that the Minister wants to give as full a reply as possible to the debate. The Turkish Government have a substantial involvement in the issue. Their transplantation policy constantly creates a position in which it will be more and more difficult to reach a just solution. The hon. Member for

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Hendon, South was right to say that the northern Cypriots resent the transplantation of mainland Turks, who are disturbing the whole of their cultural pattern. The people from Anatolia may be coming under duress or of their own free will, but they are coming to a foreign country. Cyprus is Cyprus and Turkey is Turkey.

The transplantation of populations is a form of ethnic cleansing--or ethnic engineering, as my hon. Friend the Member for Tooting said--and it can only confound the possibility of a proper and just settlement. As I have said, some 37 per cent. of the most fertile part of the island is occupied by 18 per cent. of the population. The only way the conflict can be resolved is by international negotiation, but the United Nations is running out of patience and may eventually have to take some draconian decisions to reach a solution.

My hon. Friend the Member for Hornsey and Wood Green referred to the possibility of Cyprus joining the European Union. I am a little more optimistic than she was about the British Government's views on that. My understanding is that the former Minister of State at the Foreign Office said that the entry of Cyprus would be part of the next tranche of enlargement. That will trigger some action and there may be some movement to end the stalemate, which can only be of benefit to a problem that has been bogged down for 20 years. Mr. Denktash has said that if Cyprus joined the EU, he would want to link up with Turkey. Of course, Turkey also has a vested interest in an association with the EU and eventually becoming a member of it. Although it may not be a candidate at the present time, it has a treaty of association with the EU and I am sure that it would not want to lose that. The Turkish Government might not like Mr. Denktash using them as a threat against their possible future in the European Union.

The solution must be even-handed. There are Cypriots, some of Turkish origin and some of Greek origin, but they are all Cypriots. I am quite prepared to accept that there might have been abuses in the past on both sides, but in the future we must try to create a situation that is just and equitable, so that the warm people of Cyprus--whom many of us have met in this country--on both sides of the line can be safe in their homes and the future of their children secure.

11.20 pm

The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr. Tony Baldry) : I congratulate my hon. Friend the Member for Hendon, South (Mr. Marshall) on having secured a debate on this important subject on such a significant day for Cyprus. He has a long- standing and understandable interest in Cyprus.

We have heard a number of heartfelt speeches during this debate and I hope that it will be helpful if I set out some of the considerations governing our overall approach to the Cyprus problem and our view of recent developments in the United Nations-sponsored intercommunal talks, our role in support of United Nations efforts and how we see matters developing, and if I try to respond to as many as possible of the points that have been raised. It has been a relatively short debate, but much ground has

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been covered and I hope that hon. Members will not consider it discourteous if I do not give way because I, too, want to try to cover as much ground as possible.

As has been said, today is the 20th anniversary of the landings in Cyprus by the Turkish military, coming five days after a coup inspired by the then Greek military junta against the Republic of Cyprus. At the time, the United Kingdom Government rightly condemned those events and was instrumental in securing United Nations Security Council resolutions calling for an immediate end to the fighting. The hon. Member for Hornsey and Wood Green (Mrs. Roche) made poignant reference to the fate of many of those missing as a consequence of those events and our thoughts must be with the relatives of those missing from both communities. The United Nations committee for missing persons, including representatives of both communities, is charged with investigating the fate of those missing. I am afraid that at times one or both communities have not co-operated with the committee's work.

The hon. Member for Knowsley, South (Mr. O'Hara) and others referred to the position with regard to settlers. We have made it clear that we regard their position, and any attempt to upset the demographic balance, unhelpful in attempts to reach a solution and we have said so. We joined other Commonwealth Governments at the Heads of Government meeting in Cyprus in October 1993 in calling for an end to such settlement.

Twenty years on, our thoughts must be with Cypriots of both communities who suffered then and have suffered since. We should think not of those killed and injured and their relatives, but of those who are displaced and have been unable to live in or return to their homes. We should think, too, of those members of the United Nations peacekeeping force in Cyprus, including our service men, who have given their lives trying to prevent fighting, of those who have striven since to keep the peace and those who are still there nobly engaged in the peacekeeping task.

Our efforts to help to find a solution to the Cyprus dispute are driven by the wish to avoid a repetition of the events of 1974. Our overriding consideration is that we should support the efforts of the United Nations in terms of both of peacekeeping and of the good offices mission of the United Nations Secretary-General. But our status as a guarantor power means that we aim to complement as well as support Mr. Boutros-Ghali's mission, while observing the primacy of his mandate. In so doing, we seek to assist both communities to find the way forward to an agreement.

Our activity takes many forms. We are active diplomatically in talking to the parties and the other guarantor powers. We are active at the Security Council in New York, working for measures that will promote a settlement. I make it clear that we are not in the business of prescribing the details of a settlement--but if it is to be a peaceful, just and lasting settlement it will have to meet the interests of both communities and secure their full agreement. The history of such disputes shows that a settlement imposed without agreement will not last.

Although we would not prescribe the details of a settlement, we have views about its overall shape and form. The Secretary-General's ideas provide a good basis. He envisages a bicommunal, bizonal federation. My right hon. Friend the Foreign Secretary put it more clearly and in friendlier terms-- one country, one Cyprus, one federal Government and two communities.

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The House will gather that we remain committed to one Cyprus, and there is no question of our recognising the so -called Turkish republic of northern Cyprus. We have always considered its declaration invalid and supported UN Security Council resolution 541 of 1983, which called on states not to recognise that republic. That is not to say that we fail to acknowledge the interests of the Turkish Cypriot community. We are prepared to bear the brunt of much criticism because of our contact with that community. We see that contact as consistent with our status as a guarantor power and our obligation to deal with both communities if we are to be effective in encouraging a settlement.

Refusal to deal with one community would merely lead to entrenchment and make a settlement harder to achieve. We maintain contact with Mr. Denktash and others prominent in the Turkish Cypriot community and who have influence, so that we can do our best to encourage that community to reach a settlement. We are determined that those contacts will continue.

We see our role as encouraging the two communities towards a settlement-- chivvying and urging them and other guarantor powers, and fostering the right environment for negotiations. We do so not only by substantial diplomatic efforts and intensive contacts but through our contribution to the UN force in Cyprus. In addition to speaking to both communities, it is important to encourage them to speak to each other. My right hon. Friend the Foreign Secretary hosted a lunch in Nicosia for the two community leaders during the Commonwealth Heads of Government meeting last October. Our High Commission in Nicosia is always trying to promote bicommunal activities and it deserves encouragement, not criticism, for doing so--as do those members of the communities who seek to develop contacts.

Since March 1993 the UN Secretary-General has tried to secure agreement on a package of confidence-building measures for Cyprus. They involve the re- opening under UN control of Varosha, a former Greek Cypriot suburb of Famagusta, and of Nicosia airport. The package is designed to facilitate progress towards overall settlement and to build mutual confidence between the two communities. The leader of the Greek Cypriot community, President Clerides, accepted the package in principle last year but the Turkish Cypriot leader, Mr. Denktash, did not.

Consistent with our policy of supporting the UN, my right hon. Friends the Prime Minister and the Foreign Secretary raised the Cyprus issue with their Turkish counterparts in January and urged them to promote a constructive approach by Mr. Denktash to the confidence-building measures. Shortly afterwards, he accepted the package in principle and UN-led talks on its implementation began in Cyprus on 17 February.

On 30 May the UN Secretary-General reported to the Security Council on progress. He concluded that a lack of political will on the Turkish Cypriot side was to blame for failure to reach agreement on the confidence-building package. He suggested five options for taking the process forward-- withdrawal of the UN force in Cyprus, coercive measures against the Turkish Cypriots, a return to discussion of the set of ideas, far-reaching reflection on

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how to approach the Cyprus problem and a continued focus on the confidence-building measures package. Since 30 May, Mr. Denktash has said that he could accept the UN package subject to clarifications subsequently discussed with the Secretary-General's deputy special representative and the proviso that the changes are recorded in a revised UN paper.

The UN Secretary-General wrote to the Security Council on 28 June and informed it of that helpful change in Mr. Denktash's position and concluded that the two sides were now close on substance but remained divided on how the package should be presented. He hoped to break the impasse by sending the two parties an identical letter that would set out a basis for agreement. The Secretary-General observed, however, that neither leader was prepared to commit himself to co-operate with him if he proceeded as he had intended. It is now the turn of the Security Council, which is considering the Secretary-General's report and letter and expected to give a steer on the way forward in the next few days.

Our view is that a single option out of the options set out in the Secretary-General's report of 30 May is no longer an appropriate choice. We favour a combination of the two options : a process of consultation led by the Secretary-General with a view to undertaking a fundamental and far- reaching reflection on ways of approaching the Cyprus problem, and a continued effort to secure implementation of the confidence-building measures. We are working for a response which would initiate that wider process of consultation and examine the substance of the problem while not simply jettisoning what has been achieved in detailed negotiations on the confidence-building measures package.

A number of hon. Members raised the question of the possible European Union accession. I make it clear that the UK supports membership of the Community for those European countries that want to join and can meet all the conditions of membership. Cyprus applied to join the European Union in July 1990. The European Commission submitted its opinion on the application in June 1993, and the opinion confirmed Cyprus's European identity and character and its vocation to belong to the Community. On the basis of the progress achieved to date under the 1972 EC/Cyprus association agreement the opinion was generally positive about Cyprus's ability to adopt the necessary acquis within a reasonable time scale, but a number of structural and other reforms are still necessary.

The opinion also recognised the difficulties of accession ahead of an intercommunal settlement, but, as my right hon. Friend the Foreign Secretary said :

"We want to remove those difficulties ; we want to see Cyprus admitted. That is one reason . . . why we, perhaps more than any other outside country, are working so hard to find a solution . . . Our attitude is a positive one--to remove the obstacles to the accession of Cyprus."--[ Official Report , 11 July 1994 ; Vol. 246, c. 702.]

It is important to stress that it is not in the power of the United Kingdom, the European Union or, indeed, the United Nations, to compel a workable solution

The allotted time having expired, the debate was concluded, in accordance with Madam Speaker's-- statement --[ Official Report, 14 July 1994 ; Vol. 246, c.1197. ]

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Newspaper Prices

11.32 pm

Dr. Tony Wright (Cannock and Burntwood) : There is always a certain tension when politicians start talking about the press, and so there should be. As H. L. Mencken famously said, the proper relationship of journalists to politicians is that of dogs to lamp posts. The fact is, though, that there are some pretty savage dogs out there at the moment and they are getting more savage by the day. I think that it is up to the lamp post to take some interest in them and to try to suggest that some kind of response is required.

I wish to talk about the so-called price war--the phenomenon of predatory pricing--that is now rampant in what we used to call Fleet street, but which, post-Wapping, we have to find some other way to describe. I shall remind the House of what has been happening and give a short chronology of the background to tonight's debate. Let us return to last year, and I shall take the House through the sequence. On 12 July 1993, The Sun dropped its cover price from 25p to 20p. Also on 12 July, the Daily Mirror responded by dropping its price to 10p for one day only. On 26 July, the Daily Mail increased its cover price from 30p to 32p. On 2 August, the Daily Express went up from 30p to 32p in line with the Daily Mail . On 16 August, Today experimented by reducing its price from 25p to 20p in the Liverpool area only. On 6 September, The Times dropped its price from 45p to 30p between Mondays and Fridays, and from 55p to 40p on Saturdays. On 10 October, the price of the Independent on Sunday rose from 90p to £1. On 12 October, The Independent increased its price from 45p to 50p between Mondays and Saturdays.

On 10 January 1994, The Sun dropped its price from 20p to 10p for one day to support its television game show promotion. On 24 January, Today dropped its cover price to 10p for one day only. On 23 June, The Daily Telegraph dropped the price of its Monday-to-Friday editions from 48p to 30p. Also on 23 June, The Independent dropped its price to 20p for one day only. On 24 June, The Times reduced its price further from 30p to 20p between Mondays and Fridays and from 40p to 30p on Saturdays. In the past few days, News International has sought to extend its predatory pricing to Scotland, with similar effects.

Mr. Tam Dalyell (Linlithgow) : Lowering the price of Today to 10p is a classic example of predatory pricing. In connection with Scotland, however, does my hon. Friend recall that the late Roy Thomson was made to choose between continuing to own newspapers such as The Scotsman and giving up his STV holdings, or keeping his television holdings and giving up his newspapers ? Faced with the choice, he gave up his television holdings. That might be a good precedent for making Mr. Murdoch choose between his newspapers and his extremely lucrative BSkyB. It is one or t'other.

Dr. Wright : As always, my hon. Friend has made a pertinent point. I hope to deal with it shortly, in terms of similar choices that may have to be made now. It is an interesting precedent from an era that was far more mindful of such issues ; the spirit is rather different now.

That, then, is what has been happening on the news stands in the past year. The question is, why has it been happening ? What is behind it ? The answer is quite simple : one dominant newspaper group and one media magnate

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--News International and Mr. Rupert Murdoch- -have sought to drive out as much of the competition as possible. There is no doubt about the intention or the strategy ; there has been a certain openness about it. There can be no excuse for not knowing what has been going on. Let me give the developments a wider context. At a time when the overall sales of newspapers are falling, it is no longer possible to expand by increasing the total share of newspaper sales, because the trend is in the opposite direction. The only way in which to prosper and advance is to seek to take existing shares, and to do so in an aggressive and, if possible, predatory way.

How can that be done ? In the case that we are discussing, the organisation concerned is sitting on a large sum--a treasure. It is possible to raid that treasure in an attempt to drive out those who are not sitting on treasures. We are talking of an organisation that made a profit of £439 million last year, and is quite happy to draw on those reserves to see off the competition and strengthen its own market position, although it is making enormous short-term losses by doing so. It is sitting on a pot of gold because it is sitting on an empire.

The empire involves a third of the press here, but it is a global empire, with a huge array of newspapers and magazines across this country, Australia and the United States, as well as Sky Television, Twentieth Century Fox films, Fox Television in the United States and a developing interest in satellite television in the far east. It is a global media empire and it is possible to draw on its resources to engage in predatory pricing here. There is no dispute about the fact that that is happening because the strategy is clear.

The intention has been described by a number of people. The Independent is one of the newspapers that has been in the firing line and it has seen its circulation drop from 334,000 a year ago to 277,000 now. For its main enemy that is no doubt seen as a great achievement, but I believe that it is an enormous loss in terms of pluralism and diversity in this country. It is hard to dissent from the view of Mr. Andreas Whittham Smith, the editor of The Independent , who wrote a signed editorial in the newspaper last month in which he said :

"Two right-wing ideologues, Rupert Murdoch and Conrad Black, have set about destroying the quality newspaper market."

That is the intention and, from their point of view, it is succeeding.

I prefer the comment which was relayed by the editor of The Times , Mr. Peter Stothard, who said :

"I have had one letter of complaint from a vicar who did not think it"

the price cut

"was right."

As ever, a solitary vicar, if no one else, understands what is going on and a solitary vicar understands that there are ethical, moral and democratic issues surrounding this issue which need to be addressed.

There can be no doubt that it is News International's ability to draw on its reserves which is enabling it to sustain the strategy. Reliable reports suggest that The Times is losing at least 2p on every copy that it now sells, and some estimates are higher than that. Despite a 42 per cent. rise in circulation as a result of its pricing policy, its daily revenue is now £45,000 lower that it was last autumn, despite adding 230,000 copies to its circulation. It is taking huge losses in pursuit of the strategy upon which it has embarked.

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The pricing policy of The Sun was the precursor of the strategy for The Times . Its circulation is 20 per cent. higher than the year before the predatory pricing started, but the 5p price cut means that it is earning £70,000 a day less than it was before it increased its sales.

The figures that I have given are rather modest. Some of the figures from the media analysts are more startling.

Mr. Dalyell : Perhaps my hon. Friend will allow me to give an even more immodest figure. Of the 20p for The Times , I am told that 17.5p goes to the wholesalers and retailers who distribute and sell the newspaper and the 2.5p that comes back to News International does not begin to cover the cost of printing and paper, which I am told is about 15p per copy. I believe that those are accurate figures.

Dr. Wright : They are accurate, and extraordinary, figures. Although the figures differ depending on the source that one uses, they all point in the same direction. It is not disputed, even by sources close to News International, that the figures are of that order. It is deliberately taking huge losses in pursuit of a certain objective, and it will take those losses over an exceedingly prolonged period because it can afford to do so. I shall say in a moment what I believe the outcome of that will be.

If we take seriously the Office of Fair Trading's obligations in relation to predatory pricing, and if we cast our eye over the cases that that body has looked into over the years, we must find that this is a classic illustration of predatory pricing. Predatory pricing occurs when a dominant player in the market deliberately sets out to cut prices in order to drive out competitors, using its market to do so.

I found it extraordinary that the Director General of Fair Trading said last September that he could not become involved in this case because it seemed to him to be merely "aggressive pricing" rather than predatory pricing. It is interesting that now, in the wake of the further decrease in the price of The Times , the position has changed and some sort of inquiry can be held. I shall deal with that point in a moment.

Let us consider the ground rules for competition policy, about which the Minister will doubtless have something to say. Section 2(1) of the Competition Act 1980 defines an anti-competitive practice as "a course of conduct pursued by persons"

in the course of business, which

"has or is intended to have or is likely to have the effect of restricting, distorting or preventing competition in connection with the production, supply or acquisition of goods".

Surely that is precisely what is happening now--it is a directly anti- competitive practice used by a monopoly player in the market to drive out competition.

The question is, what is the response ? Let us look beyond what has been happening for the past year. Mr. Rupert Murdoch informed us that his vision of the future is an industry in which they may be only three newspapers-- The Times , the Daily Mail , and The Sun . That is his vision of the plurality of British newspapers. Or course, he already owns two of the three.

We have to make up our minds--do we think that such behaviour and such ambition are consistent with what the House has always said, from Pilkington onwards, about the need to guarantee pluralism and the need for the state to prevent monopoly players from exercising excessive power ? Do we still hold the same views, or do we want to

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be rolled over by Mr. Murdoch so that he can realise his vision of a future with only The Times , the Daily Mail and The Sun ?

Mr. Dalyell : It is a matter of record that that is precisely what Mr. Murdoch said to Sir David English--it is not only a figment of Opposition Members' imagination. He is on record as saying that we would be left with those three newspapers.

Dr. Wright : Indeed, I think that Mr. Murdoch said not only with ambition but with a certain zestful pride that it would show that the strategy had worked and that there had been another gain for his media empire. The question is, where does it leave the rest of us ? Where does it leave democracy, choice and diversity ?

That is not to be seen as aberrant behaviour. It should not take us by surprise, because in a sense it is only what large businesses always do when they can get away with it. That is why the cases that the Office of Fair Trading has had to investigate over the years are exactly comparable with that case. For a major player, in its own terms that is rational market behaviour. If it is possible to do such things, it is rational to do them. If the law and the regulations are such that it is possible to engage in predatory pricing to drive out the competition, it is rational business behaviour to do so. That is precisely what is happening now--because such developments have not been challenged or checked. Therefore, as in other business areas, the attempt is made to drive out a competitor that one does not like. If one can afford to take great losses in achieving that, one will do so.

The problem arises because we are talking not about baked beans but about newspapers. Traditionally we have thought that it was rather important to guarantee the integrity and plurality of newspapers, and to protect them from such business behaviour. There was something special about newspapers. There was something special, something vital to our democracy, about the ventilation and distribution of opinion. It was not a business like any other.

However, we now have people like Mr. Murdoch

Mr. Chris Mullin (Sunderland, South) : Has my hon. Friend noticed that the Minister appears to be doing his correspondence ? Even now I do not think that he is with us. Does my hon. Friend think that that bodes well for the quality of the reply that he is likely to receive to his excellent speech ?

Dr. Wright : My hon. Friend makes the sort of impish point in which we all delight. However, having spent two or three months locked up with the Minister in the Committee that was discussing the Deregulation and Contracting Out Bill, I am used to his being otherwise engaged while I am making important points. Indeed, we had an exchange on that subject in Committee.

What I have described is rational market behaviour, but it is rational market behaviour that is simply not acceptable when applied to newspapers and to opinion. We see such behaviour elsewhere, too, of course. If we cast our eyes around at the operations, including those of Mr. Murdoch, of media moguls in other parts of the world, we see exactly what is going on, and how different regulatory systems require different responses.

In Australia, for example, the Government have traditionally been a wholly owned subsidiary of the

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Murdoch empire. But in the United States Mr. Murdoch ran into difficulties, because there was a much tighter regulatory regime there. When Senator Edward Kennedy sought to reactivate a rather ailing regulatory regime, Mr. Murdoch, according to the recent book about him by William Shawcross, described it as "liberal totalitarianism", and set out to get Kennedy through his tabloid newspapers in the United States. Fortunately, the regulatory regime got him instead. In New York and in Boston he had to back off, because there were rules there that made it impossible for him to proceed.

Unfortunately, the position here is different. It is well understood that one of the large anomalies or large holes in the Broadcasting Act 1990 is the fact that it does not prevent people with satellite television interests from moving into newspapers. That made possible, in a way that was most helpful to Mr. Murdoch, the kind of cross-media ownership that we have traditionally taken steps to prevent. At the time, he was thought to be extremely helpful to the Conservative party. There may be different views about that now, but at the time the view was that the hole had been nicely opened up so that Mr. Murdoch could walk through it.

We are having this discussion at a time when there is a tremendous push to sweep away the existing legislative inhibitions to cross-media ownership. We are being told almost daily by those who have power inside the industry that the time has come to move decisively in the direction of further deregulation and that the only way in which to become global players in the contemporary media business is to sweep away all the regulatory structures.

If we look around the world, we see exactly what such a change might mean. One does not have to look much further than Italy where Mr. Berlusconi is now happily bringing neo-fascists into his Government. He sits at the apex of a media-political empire. One can see there the potential consequences of our sweeping away regulatory regimes. Indeed, if we are serious about pluralism, we must be serious about enshrining pluralism in structures that have some chance of delivering it.

This is a matter of some urgency. The Office of Fair Trading has, I am afraid, not acted with sufficient urgency. It would be extremely serious and damaging if--the Office of Fair Trading having announced that it was finally to look at the matter, after having said initially that it would not--we now had a protracted period in which the OFT brooded on the matter for the best part of a year, after which it might--or might not--make a recommendation to the Monopolies and Mergers Commission. By that time, the fate of important and serious newspapers would have been irretrievably damaged and some of them might have disappeared. I press the need for urgency in relation to the issue now.

There is also a longer-term issue, which is that of media ownership. We must think afresh about the nature of pluralism in terms of developing media conglomerates. The European Union drew attention to the matter a few years ago in its Green Paper on pluralism in the media. The issue is there and there is a tremendous drive from those inside the industry to throw off the regulatory structures. We must start to ask what the public interest is ; in relation

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to this issue, we must ask what the public interest is in ensuring that newspapers survive and that the plurality of newspapers survives.

Sometimes we have cause to be grateful for things that may seem disconcerting at the time. I believe that we shall come to be grateful to The Sunday Times for its actions a week or two ago in showing how certain actions in this place can seem extraordinarily reprehensible to people outside although they evidently seem perfectly normal to people inside. I hope that out of that intervention, some good will come. Similarly, I think and hope that this price war--this predatory pricing--in so far as it reveals the ability of a powerful player to seek to use his power simply to drive out competitors so that his market share can be increased, will be so offensive to the public interest that it will produce renewed attention to the question of how we can guarantee pluralism and diversity.

We have a price war raging at the moment which is profoundly damaging to diversity and profoundly damaging to democracy. The Government, in their deregulatory mode, seem to find it perfectly acceptable and nothing to worry about. I assure the Minister that many people in the country are profoundly worried by what is happening and would grieve enormously if serious titles were lost. It would be damaging to the people who work for them, it would be damaging to the people who read them and it would be damaging to our democracy.

11.58 pm

Mr. Peter Bottomley (Eltham) : If I am the only Back Bencher who wants to speak, I can assure the House that I do not intend to speak for all that long.

I declare various interests. I earned money by writing for various newspapers, and I have had lunch with various people in the media. At the end of this debate, I intend to read the papers that have been sent to me by the public affairs people from News International. The only part that I have picked up so far, because I thought that I should come to this debate, is that I may be wrong in saying that the subsidies to The Times have come from outside this country. That may be accurate ; I do not know, and I do not particularly care. The hon. Member for Cannock and Burntwood (Dr. Wright) has done a service to politics in his book on politics, and he has done a service to the newspaper industry in introducing this debate today. He has clearly stated many of the issues.

I come to this debate with a history. When News International took over The Times and The Sunday Times , I did not support my party on the motion tabled by the Labour party. There were strong arguments that that takeover should have been referred to the Monopolies and Mergers Commission. The rules as I interpreted them, and as the Government should have interpreted them, were that The Sunday Times was clearly a profitable newspaper, and there was no ground on which the Government should rely in not referring The Sunday Times takeover, even though it was said that that was the only way to save The Times .

It is worth remembering that there is a spectrum of newspaper pricing. It would be possible for a proprietor or a company owning a newspaper to distribute it free. In many of our constituencies, newspapers are distributed free. The distinction which the hon. Gentleman would

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make is that those newspapers are not distributed free for long at a loss. They rely on getting sufficient advertising to make them a commercial justification.

It is worth noticing that we have one broadsheet daily newspaper, The Guardian , which has a structure that was set up especially so it could be produced at a loss. The Scott trust is designed to keep The Guardian going, even though at times it may look as though it is at risk of making a profit.

Perhaps the distinction between The Guardian and other newspapers is that it is not a threat to other newspapers. No one can claim that The Daily Telegraph loses a serious number of readers to The Guardian . It may not gain the young readers that go to or stay with The Guardian for as long as they can face the letters page. The Observer was a loss-making newspaper for many of its 200 years of history. At one stage, it was bought by an oil company, Atlantic Richfield, and it was owned to greater or lesser degrees of distinction by Lonrho. There was a time when the Observer was losing about the same as its cover price on every issue sold, but no other newspaper seriously claimed that the Observer was making inroads into its market.

The reason why the Sunday Express was losing some of its share of the market from its previously phenomenally successful position was not because the Observer was being sold at a loss. I do not think that commercially successful editors of The Sunday Times would argue that the Observer being sold at a loss was serious competition to them. I think that the reason for that is partly ideology.

Now that the Observer is in new ownership, it tends to run its front page as though it was the Monday of The Guardian , where the story is not quite as reliable or as balanced as the stories on other days of the week. The Observer did not go in for predatory pricing. It tended to price itself at roughly the same level as The Sunday Times .

If people were to ask about the distinction between the price wars now and those loss-making newspapers, I think that it is the increasing of the loss of The Times . As to the pricing of The Sun , one can argue that the paper is still making a profit. I do not want to argue The Sun case too strongly. My view is that The Sun is in a declining market and its sales will fall faster that those of the News of the World . The reason for that is the combination of two issues.

The first issue is the change in the way in which people go to work. As more and more people drive to work, not only on days when there is a rail strike but as a general change in pattern and as a result of greater access to motoring, they do not pick up a newspaper at a news stand on the way to work as they did when they went by public transport, by foot or even by bike. That is a change. The second issue is that, over the next two or three decades, or possibly in the next two or three years, more and more people will set the standards for what they take home and what they do and buy at work, which are higher than the ones that they had in the past. A significantly growing number of purchasers of The Sun will say that it is not the newspaper that they want their children to take once they start reading one. A general uplift will take place, which will be reflected in our politics and newspapers.

The suggestion from Rupert Murdoch that The Sun will not just continue to be a boobs and bottoms newspaper is correct. I must say, however, that no one should be worried about naked bodies, because, if we take our clothes off and

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