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Mr. Alexander: I hope that my hon. Friend will bear in mind the fact that joint action was taken by the Department of Trade and Industry and the Scottish Executive to ensure the extension of the service for Atlantic Telecom customers, and that when this issue was addressed in an Adjournment debate I gave an undertaking to consider the specific issue of regulation thrown up by the Atlantic Telecom case after I had put the rescue package in place.
John Robertson: I thank the Minister for that information. I did not know that, and I will take his comments on board. I realised that the Scottish Executive had done something, but it only provided service on an incoming call basis for about six weeks. Although that helped businesses over the initial period when they were trying to get their communications systems sorted out, many of them that did not have that extra money to take on the new operator were left in a bit of a state. I am glad that the Minister has taken that on board, and perhaps he will do the same regarding the next item I want to raise.
There is little point in having any regulatory framework if consumer interest does not underpin its entire operation. I would welcome Ofcom having powers along the lines of those of the Association of British Travel Agents, which investigates claims for compensation for people with a complaint against a travel agent. Although I welcome the creation of Ofcom, my concern is that it will be a toothless tiger, and we need to ensure that the consumer is not left to flounder when things go wrong. Ultimately, we need to make sure that there is sufficient scope for customer redress.
For example, there could be a bond for a licence based on projected turnover. That would ensure proper cover for the consumer, and would pick out the cowboys as they would not be bonded. I am sure that the Minister could think of other ways to look after the consumer, and I would be interested to hear his ideas on the subject.
Mr. Alexander: I can give my hon. Friend an assurance that we are considering all the options in the light of the Atlantic Telecom case. We will examine the specific example that he has given, not just in relation to this Bill but as part of the Department's ongoing work.
John Robertson: I thank the Minister once again. I welcome the Bill. I have raised a number of issues. We need to ensure that the design of the new body is right: it must be transparent, the regulation process must be clear, its objectives must be clear and it must be governed to the highest possible standards. Most of all, it must protect the customer and the industry.
Angela Watkinson (Upminster): I should like to state my qualified support for the Bill. There is an urgent need for a major revision of, and general deregulation in, broadcasting and communications. It is good news that the Government are taking steps in the right direction. However, those steps are yet to be defined, so the Government should get on as quickly as possible with producing the main Bill on the communications sector. As Ofcom will undertake its regulatory role when the communications legislation receives Royal Assent, I look forward to seeing the draft Bill. As ever when complicated subjects such as this are involved, the real interest of the House will be in the detail of the future legislation.
The creation of Ofcom as a single, all-encompassing regulator is welcome, but it should of course include the BBC, which will be an essential component. This is a wonderful opportunity for the Government, once and for all, to stop interfering in the media and communications industries.
We need to ensure that the legislation is right not just for now, but for years to come. The speed of development of digital technology, and the convergence of communications, have highlighted the inability of the regulatory framework to keep up with the rapid pace of change. After all, the current framework was designed at a time when the full implications of the digital age could not have been predicted either by politicians or by the industry. We need to get rightand get right for a generationthe proposals in this paving Bill, as well as those in the communications Bill. The structure and span of control therefore need to be flexible and open to change, just as businesses regulated by Ofcom need to be.
We should be proud of the lead taken by the industry in this country, in both telecommunications and broadcasting, and should be waiting impatiently for the next stage of convergence of the sectors. Let us hope that the legislation we pass allows the industry to be something of which we can be proud in years to come.
Without doubt, there should be a coherent and consistent approach to regulation of the converging communication industries. At the same time, the Government need to ensure that Ofcom adopts a restrained approach in regulation. A light touch is essential to allow the various media industries to thrive, and to exploit the new levels of competition that we are witnessing across the globe. Competition should be embraced actively. I hope that the hon. Member for Twickenham (Dr. Cable) will be pleased to note that I do not split my infinitives.
A positive approach to legislation should be the foundation on which Ofcom is based. An example might be an abiding desire to avoid interference in emerging markets unless significant disadvantages to consumers are apparent, and no credible way for the market itself to deal with such problems is in sight. The Commercial Radio Companies Association has said that the commercial- radio industry in this country has experienced improved revenue and audience figures owing to reduced regulation since 1990. The Government must ensure that there is no reversal in the trend because of the application of excessive burdens and regulations to an industry in which they would be wholly unwanted and unwarranted.
In connection with the delicate but important issue of appointments and general accountability, the Centre for Policy Studies expressed valid and succinct concerns in its document "OFCOM is watching you":
The Government have had more than five years since they started drafting their 1997 general election manifesto to formulate detailed proposals in that sphere. However, whatever the drafting problems, we cannot establish an elaborate and potentially powerful organisation, with an equally powerful chairman and chief executive, without knowing precisely what qualifications may be best suited to the performance of their duties, what the organisation will do or even when it will do it. Indeed, we could witness a ludicrous situation: if there are considerable delays, the officers of the new organisation could be sitting around with very little to do while drawing pay. The only way of aligning Ofcom with the eventual substantive legislation that it will administer is to link them by ensuring that Ofcom starts to operate only when its brief and duties have been fully defined.
I finish on a positive note. Prior to the various stages of debate in the other place, the concerns on accountability that were held by many people in the communications sector were numerous and valid. I applaud the sensible revisions to the Bill that were carried out in the other place, notably requiring Ofcom to keep a register of members' interests, to publish its regulations and procedures, to record decisions and to maintain those records. I hope that with further scrutiny and debate in the House we will ensure that the communications industry is regulated by an organisation with a broad remit that expresses a light touch with its regulation. Ofcom promises to have the opportunity to become extremely powerful. It will have an impact on every part of society through the very nature of the industry that it will oversee. Let us ensure that Ofcom does just that: oversee and not over-regulate.
Mr. John Grogan (Selby): I want to concentrate on the comments about the BBC made by my right hon. Friends the Members for Manchester, Gorton (Mr. Kaufman) and for Islington, South and Finsbury (Mr. Smith). I make two preliminary remarks. First, I welcome the concept of a board of regulators, which seems to be winning through.
Secondly, I endorse the points that were made by the hon. Members for Twickenham (Dr. Cable) and for Lichfield (Michael Fabricant) about the importance of radio. The hon. Member for Twickenham said that he listened more to the radio during the week than he watched television. He is not alone. Some interesting figures over the weekend show that he is representative of the British population. Television viewing went down last year. Radio listening was maintained. People spend more hours listening to the radio than watching television during the week.
The radio sector is buoyant. Incidentally, it is characterised by strong co-operation between the public service, the BBC, which has about 50 per cent. of the market, and the independent sector, particularly in driving forward new technology and digital radio. There will be a powerful role for Ofcom in ensuring that that development continues in the years ahead.
The BBC has been one of the principal matters of contention in the debate. If one took at face value what my right hon. Friend the Member for Manchester, Gorton said, one would believe that there was going to be no relationship between the BBC and Ofcom. In fact, as various hon. Members have said, there will be a direct relationship between Ofcom and the BBC if the White Paper proposals are followed.
In terms of tier one regulation, the BBC will in matters of taste, decency and programme content, be subject to an external regulator. After all, the Broadcasting Standards Commission has that role at the moment and that will transfer to Ofcom. Ofcom will have a direct role in the economic regulation of the BBC, as it will in that of all other broadcasters. The BBC has recently combined the management of the World Service with that of BBC World. It will have to be careful in that regard. It will have to be careful to keep distinct and transparent the different revenue streams: the licence fee, the grants from the Foreign Office and commercial income. That is right and proper.
Under tier two regulation, for the first time, like other public service broadcasters, the BBC will have to provide prime time news and be subject to Ofcom regulation for that purpose. It will also be subject to Ofcom regulation in terms of programme quotas produced by independent television companies.
The expression "a level playing field" does not fully describe our broadcasting ecology. If there were a completely free market, there would be no BBC. It is there to distort the market, in the same way as the NHS is there to distort the health market. It is there to raise standards and aspirations and to increase equity. We should not forget that role.
Clearly there is a cross-party debate on the matter. I was delighted to see the hon. Member for Lichfield supporting the retention of the BBC in the public sector. I hope that that is the conclusion that his partywhich, quite properly at this point in the parliamentary cycle, is reviewing its policywill reach also. Given that Channel 4, with its mix of private and public sectors, was a prime
We then come to the contentious third tier. I listened carefully to what my right hon. Friend the Member for Islington, South and Finsbury suggested. He said that the backstop regulator for the third tier should be Ofcom for the BBC. He also said that new channels and changes to channels should be approved not by the Secretary of State, but by Ofcom. There is a danger in that.
Let us take as an example the recent approval of the three new digital television channels and five new digital radio channels by my right hon. Friend's successor as Secretary of State. That was a courageous decision, against a lot of commercial lobbying. In the case of the new children's digital channels, some of the lobbying came from the Disney corporation, which runs the Fox Kids channel. The corporation has extensive lobbying capabilities, which have been extended recently. In addition, Nickelodeona joint venture of BSkyB and Viacomargued fiercely against the proposal because it provides children's television channels.
However, the Secretary of State decided that there was a market failure. He decided that public enterprise should lead the way; it should keep the private sector honest and provide two children's channels of largely British content that did not consist of American cartoons. For those reasons, he approved the channels. It would be difficult for a regulator who, quite properly, was looking at promoting commercial channels to weigh those questions in the balance and take such a judgment.
Listening to some hon. Members today, one would have thought that the BBC governors should be abolished; some Members would undoubtedly want that. That would be a retrograde step, as the governors have an important role in protecting the ethos of public service broadcasting. However, the governors should reform themselves. They should have a separate secretariat and should not be dependent on BBC personnel who serve the Director- General. They need to modernise but they have a crucial role.
On the roll-out of digital television, it is important that digital terrestrial television thrives and that we have the three platforms; satellite, digital terrestrial and cable. I am heartened by newspaper reports that ITV, the BBC and other terrestrial broadcasters are involved in talks about how to popularise digital television, particularly non-subscription digital television. My hon. Friend the Member for Sittingbourne and Sheppey (Mr. Wyatt) said that digital set-top boxes should be given away free. I think that they could at least be provided cheaply by a consortium of broadcasters.
Is it necessary to have one date or "big bang" for the complete digital switchover? Or is it worth considering whether, transmitter by transmitter, we have a process over a number of years by which the switch-off takes place? There is merit in having some pilot schemes and in getting the technology right. There is merit in not just having a final end date, but in working over a period of years, as different areas will have a different take-up of digital television.