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3 Dec 2002 : Column 804—continued

Nick Harvey: It is important that the content board have a wide membership that brings together as much expertise as possible. The hon. Gentleman makes an interesting point.

The principal duty of Ofcom should be to further the interests of consumers and citizens. We support the creation of Ofcom offices in Scotland, Wales and Northern Ireland and agree that the accounts of the activity of each office should be published. We would also welcome regional and national councils advising the content board. Ofcom would also be well advised to have an advisory panel of business interests to give it an idea of the likely impact of its decisions.

We must recognise the unique role of Britain's public service broadcasters and the significance of those broadcasters to our evolving broadcasting ecology. We are happy that the Bill creates the possibility of a merger between Carlton and Granada. There was a time when that would not have been welcome, but in a fast-changing world market it is important that we have a strong ITV that is able to compete. There is no sense in maintaining artificial competition now that they are both up against such strong competitors both in the United Kingdom and, more particularly, from abroad.

I agree with what the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale) said about ITN. It makes little sense to sustain the restrictions on ITN ownership. I would go one stage further and make ITV take full responsibility for ITN if they merge to ensure that it is driven to be a serious competitor for BBC news and Sky news. I fear that the current arrangements are beginning to undermine ITN and will continue to do so.

I also agree with what the right hon. Member for Islington, South and Finsbury (Mr. Smith) said about the review period. It was originally meant to be every three years and the scrutiny Committee suggested that it should be every two years. I am rather despondent that

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the Bill sets out that it should be at least once every five years. It needs to be more frequent than that if it is to make a meaningful contribution.

Mr. Bercow: If there are alleged breaches by the BBC of its duty to observe due impartiality and the board of governors refuses to act, does the hon. Gentleman agree with the suggestion by the right hon. Member for Islington, South and Finsbury that there should be a back-stop power in such circumstances for Ofcom to exercise? If so, does he agree that a level of public opinion or protest could be a suitable catalyst for the exercise of such a power?

Nick Harvey: I agree that there should be a back-stop power, but it would be more appropriate, at least for now, for that power to reside with the Secretary of State and not with Ofcom. As Ofcom is a predominantly economic regulator and secondarily a content regulator, it has not evolved or matured enough for it to have ultimate responsibility for the BBC, which is what the Conservatives propose. The Government have got the balance just about right. We will soon have a detailed debate on the future of the BBC when we come to charter renewal. By that stage, Ofcom will be up and running and will have had a chance to prove itself. Then and only then should we debate what the hon. Gentleman's colleagues propose.

The scrutiny Committee had little time to absorb the 35 pages of clauses produced in the early summer on Xmust offer" and Xmust carry". The omission of those from the Bill has put some public service broadcasters into a bit of a spin. I do not advocate that the 35 pages should be reinstated, but we have not heard enough from the Government on why they came and then so swiftly went. Perhaps the Minister can tell us why they have been swept aside and why the Government are so confident that the fairly minimalist provisions now in the Bill will suffice. Irrespective of what form the Bill takes when it completes its parliamentary passage, we need to be sure that viewers across all platforms have access to all public service broadcasters. How that is achieved, from the consumers point of view at least, is a subsidiary issue. We do not want to lose sight of that.

If Ofcom is ultimately to arbitrate and referee negotiations between platform providers and public service broadcasters on terms that are fair, reasonable and non-discriminatory, we have to send either both parties into those negotiations with a pistol to their heads, or neither. We cannot have an imbalance. If there is to be a Xmust offer", logic dictates that there needs to be a Xmust carry", and vice versa. Both sides need to be locked in. Ofcom must have back-stop powers come what may to ensure that agreement is reached. We must consider those issues in Committee. I accept that the European directive as implemented in delegated legislation has the makings of a Xmust carry" provision, but we might want to probe that in more detail.

I, too, welcome the ITC's review of the programme supply market and congratulate the Secretary of State on asking it to set that up so promptly after the scrutiny Committee suggested it in its report. A vibrant and successful independent programme-making sector is important to the future of British broadcasting. Original

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UK production is part of the vitality of our broadcasting industry. It is especially important in the regions. A high proportion of independent production and a fair distribution of intellectual property rights need to be facilitated if independent production is to survive and thrive, as I am sure we all hope it will.

I welcome the provisions for access radio. Some of the experiments in access radio are proving successful and could nurture a great deal of radio talent for the future. It is important that, as we proceed, adequate spectrum is made available for access radio, and some of that may, for example, come from BBC sub-bands.

We have heard the suggestions for radio ownership rules. It is important that the regulator is able to determine a meaningful requirement of localness, which has not always been implemented with great vigour in the past. The Bill will need to be particularly tight in that area if we are to protect local radio and its listeners, so I welcome Ofcom's duty to impose localness conditions.

As for the revolution in media ownership—that is what this is—that the Government are heralding, that was not part of the White Paper. It emerged in the early summer before the scrutiny Committee started its work and only as we reached the draft Bill stage. Nothing that is suggested is implacably wicked or wrong in principle, but we already have two new Acts, the Competition Act 1998 and the Enterprise Act 2002, and we are now introducing this Bill, which we presume will be enacted next year. There will also be a complete upheaval in the apparatus of regulation, as five bodies make way and a new one is set up.

I should have thought that with three Acts needing to bed down, to prove themselves and to be probed, and a new regulator that may take time to work properly and to prove its worth, the Government are taking an enormous gamble by launching into complete upheaval of our ownership rules. To my mind, it would have made sense to allow the legislation to prove itself, and to allow Ofcom to prove itself, and then during a periodic review of the market to return to the question of ownership rules. However, the Government seem confident that it will work. The Secretary of State said in her speech that Ofcom will not permit some of the practices about which people have expressed worry, and I can only hope that her confidence will prove to be well founded.

Mr. Mullin: On the question of wickedness, is it the hon. Gentleman's understanding that removing the cross-media ownership rules from Channel Five would enable a newspaper proprietor who already owns, say, four national newspapers and one television channel to purchase Channel Five and use it to subvert ITV and Channel 4, in the same way as he subverted much of the rest of Fleet street? That would be fairly wicked, would it not?

Nick Harvey: It certainly would, and I entirely accept the hon. Gentleman's point. It has to be said that the broadcasting sector is regulated a great deal more tightly than the newspaper sector, but the hon. Gentleman certainly raises an interesting point, and it will cause hon. Members to stop and think.

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Mr. Mullin: I am relatively new to this conversation, but I would like to know whether the hon. Gentleman's understanding of the decision to remove the cross-media ownership rules from Channel Five is the same as mine.

Nick Harvey: Yes, it is, but the hon. Gentleman may want to think about some of the general competition rules that might apply. Although the Bill makes sector-specific points, he may be reassured by the fact that general competition rules might prevent that degree of cross-media ownership. Who knows, however? We are stepping into new realms. I should have thought that if the proprietor that the hon. Gentleman may have in mind were to get control of Channel Five, which I believe is being opened up because it has very low viewing figures, those figures might quickly increase, and the market might look very different shortly thereafter.

On radio ownership rules, I note that the Government have moved from three plus one to two plus one. I welcome the definition of a Xwell developed commercial radio market", but as I said, it is important that localness can be ensured and that Ofcom sets about that serious task.

I agreed with the general thrust of the comments made by the hon. Member for Maldon and East Chelmsford about religious ownership. The Government's proposals are pragmatic and sensible, but they leave in primary legislation the prohibition on religious ownership, which seems peculiar. I believe that the position will be challenged and that the Government will have to revisit the matter. I do not understand why religious organisations should be banned from even applying for a licence, although I can well see that when it comes to allocating licences, there may be strong arguments.

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