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3 Dec 2002 : Column 791—continued

Tessa Jowell: Those are exactly the type of proposals that will be examined in the review of Gaelic broadcasting that is currently under way—[Interruption.] I hear what Opposition Front-Bench Members are saying and I want to make clear how much importance the Government attach to the position and the secure future of Gaelic broadcasting. We believe that the provisions in the Bill set that future on a much more secure footing than has been the case in the past.

Mr. Lansley: Will the right hon. Lady give way?

Michael Fabricant: My hon. Friend is a member of the Committee.

Tessa Jowell: Very well, I give way.

Mr. Lansley: I am grateful to the right hon. Lady for giving way. I was beginning to think that I would be left out.

The right hon. Lady referred in flattering terms to the work of the Joint Scrutiny Committee, but one of our most important recommendations was that the many duties laid on Ofcom should not be treated equally but

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that primacy should be given to the duty of furthering the interests of consumers through competition and furthering the interests of citizens. However, the Secretary of State has chosen not to follow the Committee's recommendations in that respect. Will she tell the House why?

Tessa Jowell: The hon. Gentleman makes a good point. In fact, we took seriously the Committee's preference for the term Xconsumer" rather than Xcustomer". We tried to amend references to Xcustomer" to Xconsumer" throughout the Bill because that recognises the nature of the transactions that will form one element of consumerism that the measure will regulate. Later in my speech, I shall deal with the broader reference to Ofcom's competition powers.

There is no hierarchy in Ofcom's responsibilities. The definition of general duties used in the Bill was developed in direct response to the Scrutiny Committee's view that those duties should be expressed coherently rather than in the way that they had been listed previously. My colleagues and I accepted that.

To return to the point that I was making before I took that stream of interventions, it is fair to recognise that the BBC has been open to more scrutiny since the licence fee settlement in February 2000. The governors have introduced a package of reforms relating to transparency, fair trading and accountability. I have already welcomed the reforms announced by the chairman of the governors earlier this year. Much will be governed by amendments to the agreement between the BBC and the Secretary of State and we shall lay the relevant extract of the draft agreement before the Committee that will consider the Bill.

Part 3 also covers the Government's approach to the carriage of public service broadcasters on cable and satellite. For satellite, the measure rolls forward the current system, which is policed by Oftel and is based on EC provisions that conditional access system providers must give public service broadcasters access to their systems on a basis that is fair, reasonable and non-discriminatory. In addition, there will be a new fallback power for the Secretary of State to compel public service broadcasters to offer their services to platform providers.

Mr. Chris Bryant (Rhondda): Will my right hon. Friend give way?

Tessa Jowell: I give way to my hon. Friend.

Mr. Bryant: I had not expected such generosity from my right hon. Friend—[Hon. Members: XOh."] I meant that my right hon. Friend had already been extremely generous in taking interventions.

My right hon. Friend has wisely included the backstop power to which she referred. Is she wholly confident that it will be sufficient unto the day and that it will ensure that vertical integration in the industry does not stymie competition and open access for all broadcasters?

Tessa Jowell: Yes. We have given these issues very careful consideration and believe that the conclusion on the face of the Bill is right.

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Finally, this part of the Bill also contains our much-discussed policy on media ownership. It removes the restriction that prevents foreign ownership of United Kingdom broadcasters, removes the rules on Channel Five ownership, in recognition of its currently small audience share and limited reach, and liberalises the rules on local and national radio ownership.

It is important to understand that our proposals on media ownership are driven by three basic principles. The first is that British media need new sources of investment and the Government's job is to remove the unnecessary obstacles to that investment. The second is that it does not matter whether the investment is a dollar, a euro or a yen as long as the content of our media remains of high quality, and the policing of that content by Ofcom will ensure that we end up with the best of both worlds: their money and our standards. I do not accept that relaxation of the ownership rules will lead to dumping of poor quality foreign programmes on the public. Ofcom will not let it, and the public will not watch it.

Thirdly, ownership rules must reflect the reality of a global marketplace. So we seek to remedy the situation where, for example, Vivendi Universal, a huge foreign company with significant United States-based operations, can, as a French company, buy anything that it wants, whereas similarly global firms like AOL/ Time Warner or Viacom are barred.

The outcome of this approach should be better programming.

Part 4 is concerned with TV licensing—

Mr. Mullin rose—

Tessa Jowell: I shall make progress.

Part 4 consolidates the existing provisions, enabling them to keep pace with developments in receiver technology.

Finally, part 5 gives Ofcom tough competition powers to act concurrently with the Office of Fair Trading. Ofcom will be able to use general competition powers, but we are also retaining, very importantly, sector-specific competition rules for broadcasting—a vital part of protecting markets that do not deliver key policy objectives purely by leaving them to competition alone. Ofcom will have flexibility to use sector-specific powers, but it will not use them where it would be more appropriate for it to use general competition powers.

Part 5 also reforms the newspaper merger regime contained in the Fair Trading Act 1973, to bring it in line with the Enterprise Act 2002.

In conclusion, the Bill is the product of almost unprecedented consultation and has been greatly improved by that. I therefore repeat my thanks to the industry, to the Joint Committee, to Lord Puttnam and to the many others in the House and beyond who have made this a productive consultation process.

When we embarked on developing the legislation, we said that we wanted the most dynamic communications industry in the world. The Bill will make that possible. We said that we wanted the best TV and radio in the world. The Bill will safeguard that. We said that we had

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to protect the consumer and ensure that the media that they consume are free and fair. The Bill will ensure that. We said that we knew the difference between deregulation and laissez-faire. The Bill proves that. We said that we had the highest aspirations for the British communications sector, and we said that we wanted it to flourish and improve. The Bill will deliver that; I commend it to the House.

5.54 pm

Mr. John Whittingdale (Maldon and East Chelmsford): On behalf of the Opposition, I make it clear that we welcome and support the Bill, although, as the House would expect, we have reservations about some of its provisions, and in respect of some parts we shall press the Government to go further.

The Bill is designed to achieve two main purposes. The first purpose—to create a single regulator for the communications and media industries—was a commitment in the last Conservative manifesto, so I am pleased that it will now come about, even if it is not a Conservative Government who are enacting it.

The second purpose is to revise and liberalise the rules governing the ownership of the media. It is more than six years since we last considered this issue, during the proceedings on the Broadcasting Act 1996. As a member of the Standing Committee, I argued that the rules would still be drawn too tightly and that change was happening so quickly that the danger was that the law would become obsolete and over-restrictive almost before the ink was dry. I am pleased, therefore, that the rules are to be liberalised again, enabling us to move further towards the media being subject to the competition rules that apply in every other industry.

Michael Fabricant: Will my hon. Friend give way?

Mr. Whittingdale: It is very early in my speech, but I give way.

Michael Fabricant: I congratulate my hon. Friend on the principled stand that he took, which stopped him being on the Front Bench at the time. Is he convinced, however, that the Bill has the flexible architecture that will enable it to keep pace with technological advances over the next five or eight years?

Mr. Whittingdale: We shall need to explore that important point in Committee, but the Bill is undoubtedly a step in the right direction. Whether it goes far enough is a genuine point of concern that we will have to consider.

The new regulator, Ofcom, was extensively debated during its paving Bill in the last Session. Disappointment was expressed at the fact that so much of the debate concentrated on its role in respect of the regulation of broadcasting and so little focused on its telecommunications role. With more channels becoming available, the need for intervention and regulation of broadcasting steadily declines, but competition in telecommunications is less extensive and the need to open the market and to regulate it remains fairly strong. Ofcom will undoubtedly be an enormously powerful body, whose remit will extend across a huge

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sector of our economy, so it must be subject to the necessary checks and balances. We think that, in some areas, those may need to be strengthened.

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