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Mr. Baker: I thank the Secretary of State for giving way again. I should like to push him on the 95 per cent. figure, which seems to be set a little low. It will mean that 1.2 million households will have their televisions rendered obsolete overnight. Those who have not invested in digital television may well be the poorer members of society. What does the Secretary of State have to say about those who do not have the means to invest in a new television and will have their old set rendered obsolete?

Mr. Smith: We shall have a more precise time scale well in advance of switch-over and as we approach that moment, it will be in the interests of the television broadcasting industry to ensure that the final 5 per cent. are helped directly to make the switch-over. We do not want a substantial segment of the population to be deprived of access to television.

It is important that all sections of society should have access to the current free-to-air services. In particular, people with disabilities could benefit from the new and sophisticated services that digital television offers. There is too often an assumption that digital television is of interest only to those who want a greater choice of programmes. It brings many other advantages. For example, it can ensure better signing services for deaf people. Through the links with interactivity, it can enable the development of home delivery services for housebound people. It can help to provide community information and welfare advice for people who face disadvantage and difficulty.

I want to encourage viewers to take up and enjoy new additional services, including basic internet access, which will also become possible with the combination of digital television and telephony. Beyond that, we want digital television services to achieve much more. We want to broaden access to our rich and varied cultural heritage, to the arts and to sporting events. We want everyone to enjoy opportunities to further their education. Television, with its almost universal access, is an excellent way to begin to achieve those aims, and digital technology opens up the prospect of dedicated community education and other learning channels, backed up with interactive services.

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Nor should we lose sight of the role of radio services in the digital era. Radio was the first medium to enter the digital arena. The BBC has broadcast digital radio services since 1995 and now has a reach extending over 60 per cent. of the United Kingdom. The BBC offers Radio 1, Radio 2, Radio 3, Radio 4 and Radio 5 Live, and is developing a range of new services. They are soon to be joined by the first national commercial radio service, Digital 1 which is due to launch in November, followed soon by the first local and commercial digital radio services.

Mr. Desmond Swayne (New Forest, West): Although these are exciting developments, does the Minister accept that they do not add greatly to the difference in output of the existing radio network? There is an opportunity to provide greater variety, including religious output. Is it right that religious output should be excluded from this increase in choice?

Mr. Smith: The hon. Gentleman will know that the Broadcasting Act 1990 disqualifies groups whose objectives are wholly or mainly of a religious nature from holding a terrestrial national radio licence issued by the Radio Authority. That disqualification does not extend to local, satellite or cable radio licences where the authority is permitted to license religious bodies, subject of course to compliance with its guidelines. There are two such satellite licences--UCB Europe and Cross Rhythms--and Premier Radio has a terrestrial radio licence in London. There has been considerable pressure from United Christian Broadcasters and others to change the system. My hon. Friend the Minister for Tourism, Film and Broadcasting has taken a very keen interest in these matters and has had detailed meetings with UCB to see whether progress can be made. It is difficult to make progress at present because we are still at a relatively early stage in the development of digital radio, but we want to continue our close dialogue with UCB and others about the possibilities that may arise. My hon. Friend may have more to say about that later.

Digital radio can offer an increased number of programmes and, importantly, the potential to deliver a range of data services via the radio. I recognise the investment and work that the industry will have to put in to develop and promote digital radio. I suspect that it will be a much slower process than the development of digital television, but I am sure that, over time, consumers will embrace this new technology.

I am sure, however, that a major concern to consumers, in addition to the new services that will be available to them, will be whether they will continue to enjoy high-quality services. We must remember that people are not interested in watching delivery platforms; they want to watch programmes. Programmes are important and ultimately will drive any particular change.

All broadcasters will need to produce quality digital content to attract customers and there is a strong role for public service broadcasters--particularly the BBC, ITV, and Channels 4, 5 and S4C--in providing a diversity of viewpoints and acting as a quality benchmark.

The BBC has a particular duty in this respect. The primary message that the House should send the BBC is one that I am sure all right hon. and hon. Members will endorse. It is that the future role of the BBC, which

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will be even more important in the multi-channel age, will be to provide a quality benchmark against which all other broadcasting has to be measured. The BBC should be chasing quality rather than ratings.

In that respect, I disagree passionately with the speech that Richard Eyre from ITV made in his McTaggart lecture earlier this year. He spoke about the death of public broadcasting and tried to redefine public service broadcasting as public interest broadcasting. In particular, he said that, nowadays, the BBC should not be in the business of aiming just a little above people's heads--just beyond their immediate horizons, challenging them to reach up to something which they had not hitherto known was of interest to them. I strongly disagree. I believe--not for 100 per cent. of its programming, but for some of what it does--that the BBC should seek to stretch people and challenge them to do something that is beyond their immediate horizons; I very much hope that it will continue to do that.

Let me make one point about content, which relates to the ITV environment since the changed timing of the "News at Ten". As the House will know, when the proposal was made, I expressed a personal view--it is not a matter on which the Government could or should take a view--that I was disturbed by the potential consequences of the move. The change was approved by the Independent Television Commission, but it is worth noting that approval was given on several strong conditions. First, there should be no diminution in the funding or the range and quality of national and international news on ITV; secondly, ITV would schedule a regular headline service in the nearest break to 10 pm on weekday evenings; thirdly, the commission expected ITV's commitment to public service values to be undiminished and for the more diverse range of programmes proposed between 9 pm to 11 pm actually to be delivered; and fourthly, ITV would schedule an agreed quantity of 30-minute slots for high-quality regional programmes in or just outside peak time on weekdays throughout the year. Those were the conditions that the ITC set in agreeing to the shift of "News at Ten". It indicated that it would review the changes after 12 months.

The chairman of the commission recently expressed concern at the decline in viewing and ratings figures for ITV regional programmes and made it clear to ITV that the trend needed to be reversed before the formal review next spring. I very much hope that, when the ITC reviews the position at ITV since the shift of "News at Ten", it will look carefully at the commitments that were given and the conditions that were laid down at the time, and will be prepared to be robust about any analysis of whether those conditions and commitments are being met.

Protecting quality was one reason why I asked the independent review panel, chaired by Gavyn Davies, to focus specifically on ways in which the BBC's role could be enhanced. The panel put a great deal of time and effort into producing a measured and thoughtful basis for public consultation. I am grateful to Gavyn Davies and his committee for the work and the imagination that they put into the report, which was published at the start of August. The closing date for consultation is Monday, and we have received more than 1,000 responses, with more coming in as I speak.

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I do not need to tell hon. Members how important the issues covered in the report are for the general public, as many of those responses came via constituency Members of Parliament. I have indicated that we aim to reach decisions on the Davies recommendations around the end of the year when we have had an opportunity to consider all the responses fully. Therefore, it is not appropriate for me to give a Government view today. Our minds are genuinely open, and I want to take account of what the industry, the Select Committee and hon. Members today--as well as the general public--have to say.

One of the issues that needs the most careful consideration is the extent to which the BBC can help itself through efficiency savings, improved licence fee collection, more effective commercial exploitation of its assets and a transfer of resources out of bureaucracy and into programme-making. This is why I have adopted one of the recommendations of the Davies committee; I will shortly announce the appointment of consultants to carry out a rigorous and wide-ranging study of the BBC's financial projections, which will enable us to reach a view on the appropriate level of funding for the BBC up to 2006.

The consultants will, therefore, review the BBC's evidence to the Davies panel, taking account of the latest information available, the panel's recommendations relating to BBC funding and those areas that the panel was unable to assess in detail. The consultants will also review the BBC's assessment of the costs of its future service plans over and above maintaining existing services. I will publish a summary of the consultants' findings when I announce the Government's decision on the Davies recommendations.

I felt that it was extremely important for us to have some objective, non-partisan analysis of the detailed figures of the BBC before reaching final conclusions on the Davies report. The work of the Davies panel, the public consultation and the follow-up consultancy exercise are vital to the UK broadcasting ecology of which we are all so proud.

Because the profusion of the multi-channel digital future will not render public service broadcasting unnecessary, there may be reasons for reaffirming--and, to some extent, reinventing--public service broadcasting, but it will remain highly relevant. As our principal public service broadcaster, the BBC should continue to set the benchmark for the industry as a whole. We do not want the main result of digital abundance to be a trimming of expenditure and quality. We do not want more to mean worse.

There must still be a place for the new, the unexpected and the original, and for the unashamedly educational. Viewers expect to be able to choose difficult, but rewarding, new and stimulating programming from time to time, as well as the tried and tested. Public service broadcasters will have an important role to play in the digital future, as trusted guides and defenders of the principle of universality. The potential for social exclusion is increased by technological advances, and we will look to our public service broadcasters to counter that effect. If public service broadcasters are to continue to thrive, they must be seen to adhere to their public service remits, and to demonstrate their accountability to the public and to democratic bodies.

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In future, public service broadcasting must be something distinctive and special, with correspondingly distinct regulatory arrangements, rather than the regulated norm from which everything else deviates. That, in turn, means that public service broadcasters need to rise to the challenge of restating their purpose and demonstrating to the public that the purpose is being met.

As the number of channels increases and new technologies offer new features, such as time-shifted viewing and internet access, our system of regulation will need to evolve. Although there will always be different views about difficult cases, overall, this system has been very effective so far in maintaining standards and providing a reasonable level of consumer protection. The watershed, in particular, is widely recognised and accepted by viewers.

Changes in technology and the increase in channels will make it more difficult and, arguably, inappropriate to apply effective regulation in the same detailed way. We want to strike a balance between responding to these changes and facilitating the development of the industry on the one hand, and remaining true to the principle of providing viewers with adequate protection on the other.

We are, therefore, working with the ITC to examine how regulation in the short term can be simplified and applied more lightly. We are concerned that viewers should know clearly when they are watching broadcasts meeting familiar standards, and when they are in a new environment, as they might be when accessing the internet through interactive services.

Viewers will need new skills to navigate the new media world safely. It will be increasingly important to develop critical viewing skills for the general viewer, for parents and teachers responsible for children, and for children and young people themselves to supplement the regulatory system as it evolves. To this end, my hon. Friend the Minister for Tourism, Film and Broadcasting--together with the Under-Secretary of State for Education and Employment, my hon. Friend the Member for North Swindon (Mr. Wills)--chaired a seminar earlier this week of senior figures in broadcasting, education theory and parenting support to examine the issues and the options for action.

The research work of the Broadcasting Standards Commission will be important in providing an insight into viewers' developing attitudes. Most commentators expect that the main terrestrial channels will continue to provide the majority of television watching for some time to come. However, we need to be looking ahead to the new era and ensuring that our regulatory and legislative framework is sufficiently future-proof.

Digital broadcasting has the potential to bring great benefits to viewers of televised sport. Additional services will mean that viewers will have better coverage of more sports events on more channels. However, the Government will ensure that viewers who cannot afford--or do not want--subscription services are not excluded from access to nationally important sporting occasions.

Last year, I extended the list of events for which live and secondary coverage on free-to-air channels is protected, adding several events for the first time. I shall continue to monitor the scope of the list as digital services develop further.

The UK leads the world in digital transmission technology. The Government's aim is to have a regulatory environment that will enable and encourage the television

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and radio broadcasting industry to flourish. However, content will be the king in the digital future. I want to ensure that programme makers are best placed to identify and take advantage of all the opportunities this will bring.

The export of programmes and programme formats can benefit both the industry and viewers by generating funds for investment in the domestic market. The UK is already very successful at selling programmes overseas, but our industry can do better and, to this end, I appointed an inquiry earlier this year to make recommendations on measures to support export efforts. We shall shortly publish the inquiry's sensible and realistic proposals for the industry and for Government action.

It is equally important that we develop the talent and have the trained work force to maximise the opportunities offered by digital. The success of the industry in an increasingly converged market will rely heavily on the skills and talents of the work force. That is why my Department, together with Skillset, has established a training group of key industry players under Roger Laughton's leadership. The group, which met for the first time last month, is already setting about the task of identifying current and future skills needs and considering what needs to be done to ensure that the skills are there to allow the UK to compete effectively in the world media market.

We have challenged the industry to make digital television a success, but the Government have a clear role here in driving forward the change. I have taken the view shared by the industry that an evolutionary approach to broadcasting regulation is right and broadly sustainable for the time being. However, it is clear to me that the time for a more fundamental assessment of broadcasting legislation is coming and I anticipate that we may be able to include major broadcasting legislation early in the next Parliament.

The main issues for such legislation might be the role of the regulators, the role of the public service broadcasters and media ownership. I want to proceed with that work without delay. I am setting up a dedicated unit within my Department, and we will announce its programme of work and the consultation process in relation to these issues shortly.

This is a time of great expansion in the broadcasting industry. The development of digital technology will need a clear and careful steer from both Government and Parliament to ensure the continued success of the industry and to ensure that the interests of all consumers are protected. My announcement of a switch-over date and the prospect of new legislation is only a beginning, but I believe that it is a positive one on which to build a successful UK broadcasting policy.

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