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Michael Fabricant: Will the hon. Lady give way?
Ms Ward: I want to move on, because I know that other hon. Members wish to speak.
We shall also need to consider how we expand in the digital age to ensure that many more of our constituents benefit from the real revolution taking place. This paving Bill is a start, but I look forward to the next debate, and to seeing the detail of what Ofcom will be responsible for. Then we will know that the promises that the Government made in their manifesto to establish Ofcom will have been kept, and that the work that the Select Committee did in 1998 in producing its report will have made an important and beneficial contribution to the overall debate.
8.12 pm
Mr. Boris Johnson (Henley): I thought that I was not going to have to declare an interest in this debate—as I am merely the editor of an "old-technology" magazine—until I looked at the awesome powers to be assumed by this Ofcom that will apply to The Spectator online, which I also edit. I do not necessarily resent the wide powers that are to be taken. If this body is to take over five separate regulatory bodies, producing a smaller number of bureaucrats overseeing the media, that will be all to the
good. However, I confess that I have some anxieties about Ofcom and, in particular, its establishment, which is what we are discussing tonight.Whoever is in charge of Ofcom—Mr. or Mrs. Ofcom—will be a very powerful person. This regulator will, as has repeatedly been said, have authority over the most various and dynamic sector of the British economy. He or she will be ultimately responsible not only for all kinds of difficult questions of taste and decency—and content generally—but for vast competition issues. I ask Ministers to consider what will take priority in the mind of this person in the case of a conflict between, say, questions of competition and of decency. Who will vet the appointment of this person, and who will ensure that they are not the toady of some Government or other, as suggested earlier by my hon. Friend the Member for South Suffolk (Mr. Yeo)? I do not believe that the House has had convincing answers to those questions. It would be a good thing if this person were in some way accountable to Parliament, perhaps to some Committee or other—why not?
That is my first anxiety about the great Ofcom creation: that whoever is in charge will be unaccountable. However, I have a more profound anxiety, which has also been well rehearsed by the right hon. Member for Manchester, Gorton (Mr. Kaufman) in his excellent speech, the former Secretary of State for Culture, Media and Sport, as well as by several Conservative Members. That is that this new body does not include the BBC within its remit. Five regulatory bodies have been folded in, but not the BBC board of governors. It is difficult to see how any sensible decision can be taken about competition when the BBC falls outside the purview of Ofcom.
Let us consider this extraordinary anachronism, the BBC, in which one has—the country has—20,000 taxpayer-funded journalists. It would be fair to say that many of them, because they are state funded, have an inbuilt tendency to favour the case in support of state control or state interference. They continue to produce 37 per cent. of the terrestrial TV programmes that we watch, and 27 per cent. of all cable and satellite programmes. That is an extraordinary achievement, but it is made slightly less extraordinary by the fact that they receive £2.5 billion of state aid to do so.
I am not saying that the BBC should be abolished or privatised, but I do not see how this anachronism can last. Indeed, I am not sure how well it coheres with the state aid articles of the treaty of Rome. I often wonder whether the BBC's decidedly gentle approach to matters such as the single European currency—and to Europe generally—might be linked to some deep cultural awareness on the part of its 20,000 journalists that they depend for their very existence on the leniency of Brussels. If we look at articles 85 and 90 of the treaty of Rome, we see that many of the things that the BBC does in its current form do not cohere with state aid rules.
On the BBC news the other night there was a flagrant plug for—[Hon. Members: "Boris Johnson!"] On the contrary, it was a plug for a film about Iris Murdoch, which was partly funded by the BBC. The corporation does this all the time. Whenever one turns it on, one sees a plug for the Radio Times or some commercial arm of the BBC or other, which is competing in a commercial market with other concerns. I am not saying that the Radio Times competes with a magazine with which I am associated—far from it. It does, however, compete on
commercial terms with other magazines and, in so far as it is in receipt of state money, that is unfair. It is absolutely absurd that these competition questions should not fall within the scope of Ofcom. I hope that the Minister, having heard a fusillade of comments on this from both sides of the House, will address the matter in a slightly more robust way than he did at the outset of the debate.I shall finish by examining one body that is being wound up and folded into Ofcom—the Radio Authority. I know that this is a paving Bill, but I want to make a point about what I hope Ofcom will do when it takes over the functions of that authority. I hope that it will change the policy on religious broadcasting. I am not suggesting that I would listen to a national Christian radio station, were one to be created. I would probably not listen to it as much as would be good for my immortal soul, but I cannot see why we should not have such a station in this country. It seems absurd to imagine that there could be any disadvantage or danger involved in having one.
The only example I have been able to think of, of anyone being adversely influenced by listening to a Christian radio station is in the famous Mick Jagger song "Far Away Eyes". In it, he sings about someone listening to a gospel radio station and driving through 20 red lights because he is so confident that the Lord is holding him in his arms. However, I do not think that anyone else is likely to be so influenced.
Michael Fabricant: I am listening to my hon. Friend with great rapture and there seems to be support in the Chamber for permitting a Christian radio station, but if one is allowed, should not Muslim, Hindu, Jewish and other religious radio stations also be permitted? If they are, where will the frequencies come from, as national frequencies are not available?
Mr. Johnson: My hon. Friend makes an excellent point. I merely draw it to the House's attention that there are national Christian radio stations in Argentina, New Zealand and even Iraq, I am told. If we are moving to a new era of broad-band radio—the hon. Member for Sittingbourne and Sheppey (Mr. Wyatt) made a good point about electric light and how people did not know how much would be needed—it is wholly possible that there will be scope on the spectrum for a variety of religious broadcasting. If hon. Members feel seriously worried that its content may influence them in some way, I suggest that they could always turn it off. Ofcom is about freedom, choice, diversity and all the rest of it. If that is true, I hope that changing that policy will be among its first moves when it is called into existence. I would be grateful for an indication from the Minister of whether I am right to hope that that will be so.
8.21 pm
John Robertson (Glasgow, Anniesland): I do not think that my contribution will be as entertaining as the last one, but I shall do my very best. I am delighted to participate in the debate, but I must declare an interest. Before entering Parliament, I worked for BT for 31 years and I am a member of Connect, the union for professionals in communications, which part-sponsors a researcher to assist me with research on the communications industry. I am also chair of the newly established all-party
telecommunications group. Therefore, I have a long-term interest in communications and I have experienced at first hand the rapid change of the communications sector.I shall not go into the figures that some Members have mentioned, but people understand that the communications industry has come a long way over the years. It is interesting to note that it took about 38 years to build up a figure of 50 million television watchers in America—a country run by television—yet it took only a decade for the number of mobile phones to increase from 1 million to 30 million today. It took only four years for the internet system to achieve 50 million users, so the communications industry has moved on from a can and two bits of string. That is why Ofcom must take over from the previous regulatory bodies and why the Government's introduction of a Bill that proposes the creation of a unified regulator is timely.
The industry, in terms of service providers and content, is becoming increasingly convergent, and separate regulation will not be able effectively to monitor areas that are now essentially intertwined. I want to consider first the way in which the new regulator should work. Ofcom needs to be able to act independently, as many have said, but I agree that the new body must work closely with the Department of Trade and Industry and the Department for Culture, Media and Sport to ensure that the transition is smooth. However, Ofcom must be able to respond to changing circumstances in what is new terrain.
The White Paper set out the Government's proposals for the creation of Ofcom and attracted more than 250 responses from interested parties—broadcasters and service providers as well as trade unions, which look after people who work in the industry, and consumer groups, which protect users. I am glad that there is widespread support for the proposals. The general feeling is that the creation of Ofcom will simplify the complex web of existing regulators, removing problems in the current framework such as regulatory overlap and double jeopardy whereby the same issue can be investigated in parallel through different regulators. However, concerns have been raised and I seek clarification from the Minister.
First, how will we ensure that the concentration of authority in one regulatory body does not lead to unchallenged industry control? We must ensure that the checks and balances that exist where bodies have different remits are not lost through the creation of a single entity. Others have expressed concern that content regulation might overshadow competition and that those two aspects must be examined separately. Perhaps the Minister can put meat on the bones of that perceived problem.
We need to ensure that Ofcom is properly resourced; some companies complain that there have been difficulties with the current system due to the high staff turnover at Oftel. We must put checks in place to ensure that ongoing investigations by the new body are as smooth as possible.
The Scottish Consumer Council has raised concerns of particular importance to me. It is disappointed that the initial proposals failed to acknowledge the realities of constitutional change in Scotland. Ofcom can perform its role in Scotland only if the framework takes account of the specific political, social and economic environment in Scotland, and the SCC points out that for Scotland's
interests to be represented and addressed in the new structure, the organisation must have a positive relationship with the Scottish Parliament and the Scottish Executive.The SCC also stresses that Ofcom must maintain an office in Scotland to ensure that the protection of consumers in Scotland is addressed at UK level. Many respondents to the White Paper argued that Ofcom must maintain local offices and ensure that the relevant issues are devolved as much as possible, to reflect the cultural diversity of regions and communities.
We must address the way in which the new body will work alongside the Office of Fair Trading. I am pleased that the Minister made a contribution on that matter and that it will be considered. If I put my two pennyworth in, that might help him on the way. The proposed reorganisation of the regulatory structure will better suit the converging market place, and I support that. Multiple bodies have created a regulatory patchwork, so we need a clear description of Ofcom's mandate to act, especially on competition.
It is important that the OFT continues to lead on issues relating to competition regulation, and the OFT leadership must ensure continuity and consistency in decisions about market definition and market power. It would be detrimental to the entire process to transfer the lead role in investigations into competition from the OFT to the new regulatory body.
In some countries, such as Australia, where the industry regulator and the general competition functions are combined, overall regulation can be achieved under one roof. However, as in the United Kingdom where responsibility for competition and for industry-specific regulation is separate, the competition regulator should maintain primary responsibility for issues relating to competition. Perhaps we should consider a system similar to that in Australia. It was helpful to hear the Minister's views on the OFT, and I hope that this matter will be taken care of in the future Bill.
I want to deal with Ofcom's role in consumer protection, as I have been disappointed in the amount of attention that has been paid to the consumer in the debate. I hope to rectify that. In the United Kingdom, 4 per cent. of consumer spending goes on telecommunications, television and other communications services. As the White Paper rather nicely points out, that is more than we spend annually on beer. I have to tell the House that I do not spend that much on beer.
British businesses increasingly rely on new technology to thrive, irrespective of the sector to which they belong. However, when things go wrong their reliance is highlighted in a very alarming way. I was approached by a number of constituents who had been hugely affected by the demise of Atlantic Telecom, which went into receivership in November. Businesses that used Atlantic Telecom's services were suddenly without phone lines. All material, such as stationery and advertising, was wasted because it contained a non-existent telephone number. Some companies still face the possibility of going out of business.
The Office of Telecommunications was of no use to the people who were affected, and PricewaterhouseCoopers, which was in charge of the receivership, was also unhelpful. In fact, as they say where I come from, and as
I said to the Leader of the House in business questions in November, in this respect the current system is about as much good as a chocolate fireguard.BT wanted to take on responsibility for the service provided by Atlantic Telecom, but unfortunately that was at a cost, and nothing could or would be done. No one was willing to pick up the tab. Regulation exists to protect the consumers' interest, but this example has highlighted that that is not always the case under the current system. I disagree with my right hon. Friend the Member for Islington, South and Finsbury (Mr. Smith). We need to be rigid on consumer protection. The introduction of this legislation is an excellent opportunity to provide more effective protection for consumers.
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