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4.58 pm

Mr. Hugo Swire (East Devon) (Con): I have to confess to a sneaking admiration for the Secretary of State. She certainly does not shirk a challenge. Not content with overseeing the Olympics, she has now taken on digital switchover. The projects have similarities. They are both due to be completed by 2012; they are both huge undertakings; and they are both in danger of being completely mishandled by the right hon. Lady and her Department.

The Secretary of State has compared digital switchover to both decimalisation and the conversion to North sea gas. Other people have said that digital switchover has the potential to cause greater chaos than any other civil project in our history.

The first place in the world to switch off its analogue signal was Berlin in 2003. More than half of Germany has now switched over and the process is due to be completed in 2010—it is likely to be the first complete switchover in the world. I note that Italy has set a target date for switchover for this year, but like many things Italian it is perhaps a trifle ambitious and unrealistic. This means that Britain will probably be only the second country in the world to undertake this task on a nation-wide basis. In that respect, it would be churlish of the Opposition not to recognise the Government’s courageous and brave decision—to use civil service language—to switch off analogue, rather than to wait for a natural migration.

Natural migration is certainly playing a part. We know that some 76 per cent. of households—18 million in total—have now moved to digital television, although those figures do not include every television in those households. Equally encouraging is the fact that some 70 per cent. of households are aware of digital switchover. Two thirds understand the need to convert every set, and almost 90 per cent. intend to convert. However, that would leave more than 10 per cent., or 2.5 million households, with a blank screen when the Secretary of State flicks the switch and turns off analogue. The Bill represents the tip of a very large iceberg.

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There is no doubt that the targeted help that the Bill will enable is needed. Although 25 per cent. of pensioners regard digital television as an opportunity, some 57 per cent. regard it as a threat, according to Help the Aged, and those people will certainly want help in switching over. Although we welcome what the Bill is trying to achieve, we find it quite extraordinary that we are debating it today. As everybody knows, digital switchover will cost a great deal of money, and it is to be funded by the licence fee. As the Library notes explain—they are helpful as usual—the “precise details” of how the targeted help scheme

However, as we debate the Bill today, we still do not have any idea, from the Government, of how much the licence fee will be, and therefore how much money will be available for switchover. That is absolutely extraordinary. We were promised a licence fee settlement first in the summer, then in the autumn, and then towards the end of the year. If we are to believe the briefings to the press, we will have to wait until next February for an announcement.

Miss Kirkbride: Does my hon. Friend agree that it is ironic that a regressive tax will be used to fund the assistance that will be given to the poorest people in society to help them switch over to digital?

Mr. Swire: I may disagree with my hon. Friend on that point, but later, I shall try to tease out from the Government what switchover will cost, and what they will do with the vacated spectrum. It is not necessary for us, in opposition, to go into too much detail until we know the costs of the project, and how the Government, who are in charge of it, intend to fund it.

So what is going on? [Laughter.] I can tell hon. Members one thing that is going on—the hon. Member for Rhondda (Chris Bryant) has returned to his seat, and he will, no doubt, seek to intervene on me later. It is clear what is going on: the Government and the BBC, on whom switchover has been foisted by the Secretary of State and the big clunking fist—the Chancellor of the Exchequer—are still at loggerheads. According to briefings, the Chancellor wants the licence fee increased by an amount that is below inflation. The BBC is demanding more money because of all the new obligations that are being put on it, and because of its desire to move into emerging markets such as on-demand services. The situation is a shambles. It is riven by internal conflicts, and it lacks “grip and competence”, to quote a well-known memo that is doing the rounds.

Alun Michael: Will the hon. Gentleman give way?

Mr. Swire: I shall make some progress, but I will give way in due course. For the record, can the Secretary of State tell us when the licence fee settlement will be made, and so when we will know the cost of digital switchover? Will Parliament have an opportunity properly to scrutinise those costs? If not, will she at least allow the National Audit Office to do so?

Everyone other than the Government and the BBC is being kept in the dark. Various unofficial estimates of the costs of targeted help for switchover are doing the
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rounds, and they range from £400 million to £800 million. This afternoon, the Secretary of State went for the middle figure of £600 million, but does that include VAT? It could end up costing

pounds, according to the BBC director-general, Mark Thompson. As a comparison, the cost of retuning videos for the introduction of Channel 5 more than 10 years ago was some £165 million. That involved visits to 10 million homes in nine months and was well over budget.

The Department has suggested a cost of between £80 and £570 per household for switchover, and has estimated that 7 million homes will need assistance. However, that figure has gone from 5 million households when the former Minister with responsibility for switchover gave evidence to the Select Committee, to 6.5 million in the Government’s response to the Select Committee’s report, and now stands at 7 million. Like the Olympics budget, the figures seem to be going only one way. What assurance can the right hon. Lady give that we now have a definitive figure?

We know that estimates exist within the Department for targeted switchover, but those have been kept confidential. Why have they not been published? What does the Secretary of State have to hide? How can Parliament debate the Bill without having any idea from the Government what it is likely to cost? On myriad factors, we do not know the Department’s thinking. How many new set-top boxes will be needed? What is the cost per household likely to be? How many aerials will need upgrading?

How much will the processing and providing of social security data cost? How many households are likely to take up assistance? How many people will need to be trained to provide that assistance? What are the likely associated costs, such as Criminal Records Bureau checks on engineers? Given that those checks will be taking place at the same time as checks on those working on the Olympic building programme, what estimate has the Secretary of State made of the impact on the agency responsible for those security checks?

Not only do we not know what the cost is likely to be, but we know nothing of the Government’s thinking on the eventual budget when the money has been spent. By making the cost of targeted help part of the licence fee settlement, the Government are storing up trouble for the future. Can the Secretary of State tell us, for example, what will happen to any money that is not spent on targeted help? Will the BBC keep that money, or is it to be returned to the Treasury, or even—perish the thought—to the licence fee payer? More importantly, what if the Government have significantly underestimated the cost of targeted switchover? Where would additional funds come from? Would they come from the Treasury, from a further increase in the licence fee or from elsewhere in the BBC’s budget?

The Government have made up their mind that the BBC should fund and oversee switchover. The Select Committee, of course, came to a different conclusion. Nevertheless, there are many parties involved in the process. It is the responsibility of two Government Departments—the Department for Culture, Media and Sport and the Department of Trade and Industry, not to mention the Office of Government Commerce; two
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regulators—Ofcom and the new BBC Trust; and two sets of broadcasters—the BBC and the rest through Digital UK.

Mr. Mark Harper (Forest of Dean) (Con): My hon. Friend should note that the Ministry of Defence has a responsibility in the matter, in terms of war pensions data. The disclosure of war pensions data is a cause for concern, because in parts of the United Kingdom those data have a security impact. The junior Minister in the Department is well aware of that. There should be a provision in the Bill to ensure that that information is given out only in specified circumstances and that the security impact is properly taken into account.

Mr. Swire: My hon. Friend is right. I shall say something about that, and we will return to the matter in Committee, particularly with regard to Northern Ireland, to which, I suspect, he was, quite properly, alluding.

Alun Michael: Will the hon. Gentleman give way?

Mr. Swire: With great delight.

Alun Michael: I am delighted to give pleasure to the hon. Gentleman. I appreciate that he did not want an interruption during the rant that he had obviously been preparing in front of a mirror over the weekend. Can he help us by explaining whether he, on behalf of the Opposition, thinks that digital switchover is good news for the public, for the TV industry and for British industry as a whole, and whether he considers that a Bill that will enable the vulnerable to share in that good news and to be protected from the downside to it is not good news as well?

Mr. Swire: What is good news is the brevity of the right hon. Gentleman’s question. It is the first time that we have exchanged words since he was switched over to the Back Benches. The answer to both his questions is yes.

One is entitled to ask where the buck stops. If, once the analogue signal has been switched off, it is clear that a significant number of households have not been able to switch, or that there has been a massive overspend, who will take the blame? To whom should we turn for answers? I hope that the Secretary of State will listen to this, because I hope that it will be her.

The Select Committee expressed its concern that

The Committee also warned that the decision as to what the released spectrum should be used for needs to be made quickly. What action have the Government taken in response to those recommendations.

Given the complexity of the process, it will not surprise the right hon. Lady that we have other concerns, not least the timetable. Whitehaven is supposed to be the first area in the country to undertake digital switchover in October 2007, only 10 months away. In a briefing received last week, the charities involved in switchover voiced their concern that

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Presumably for Whitehaven to be ready to go ahead in October 2007, the BBC will have had to have received its licence fee settlement. The BBC and the Department will have had to work through the detail of how targeted help is to be carried out, and a tender process will have had to be carried out and an operating company established to undertake the process. At the same time, negotiations will have had to be concluded with parties such as Sky and NTL, as well as other subcontractors who might undertake the work on the ground. In addition, the Bill will have had to have received Royal Assent and sensitive negotiations between the Department for Work and Pensions and the BBC or its operating company will have had to be concluded for the sharing of data.

Is the Secretary of State convinced that all of that can take place by October? What assurances can she give the House that the date for analogue switch-off will not be moved from its target date of 2012? Will she agree to report regularly to Parliament on the progress of the timetable? Because unfortunately the Secretary of State has form when it comes to delays. Not only has the licence fee decision been delayed, we are also awaiting decisions on the Tote, the national lottery operating licence, the next chairman of English Heritage and the location of the new super casino, all of which have been delayed. How can we have confidence in the right hon. Lady and her Department to deliver this vast switchover project on time with that sort of track record? If she and her Ministers were in charge, Christmas would be delayed until Easter.

Turning to the process of targeted help, we have significant concerns that the Government could be encouraging, as was articulated by Opposition Members, a digital divide. As is well known, Ofcom wanted the Government to adopt a voucher scheme as the best way of ensuring that the process was platform neutral. As we understand it, people will instead be offered the cheapest option, a set-top box free of charge. Those opting instead for cable or satellite will receive a credit similar in value to what they would have paid for a set-top box.

One of the great difficulties with digital switchover is that the technology is very fast moving. Current freeview boxes use technology that is not compatible with high definition television. Has the right hon. Lady made any assessment of the likelihood and cost of a switchover II to enable wider spread of high definition and other new services? Has the right hon. Lady discussed any of this with the Chancellor or Treasury officials?

Chris Bryant: Does the hon. Gentleman agree that there must be a choice of platforms across the whole country? So far, many people in my constituency have been in danger of having no choice. If they want to go digital, they have to go to Sky, whose Freesat option is barely advertised. Many people are hesitant about taking up apparently expensive subscription services and therefore hesitant about going into the digital era. It is important that the BBC should bring forward plans for its own Freesat option in addition to freeview.

Mr. Swire: The hon. Gentleman has been assiduous in referring to this problem and has spoken for his
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constituents in digital switchover debates as regards Sky’s monopoly in Rhondda and services for poorer people in rural regions. I would welcome the Secretary of State’s comments on that. As I have said before, it is an entirely legitimate request. When digital television is rolled out, we want it to be available to all with no one left behind. The hon. Gentleman should make those recommendations again, very strongly, to the Department.

All this means that many people in receipt of targeted help will soon find that they are stuck with obsolete technology while the world has moved on. That is the view of Help the Aged, for example. It has also been argued that the use of such technology, which will restrict access to the full range of channels, will unfairly protect the BBC from competition.

As the Secretary of State will be aware, the European Commission ruled that the switchover programme in Berlin constituted illegal state aid because of the subsidies provided to broadcasters, but that the provision of free set-top boxes to low-income households was within the rules. Have her hands been tied in any way by that ruling?

We have serious concerns about the intention, as stated in the Bill, to hand over people’s personal information such as social security entitlement and benefits details. Given the Government’s appalling record on dealing with such sensitive information, we should proceed with great caution. Their growing Big Brother tendency continues apace, and we must have in place the corrective legislative safeguards.

The Bill should become obsolete once digital switchover is completed in 2012. Why is not a sunset clause built in to ensure that it ceases to be law on the day that analogue switchover is achieved, or at least shortly afterwards? I was relieved when the Secretary of State said that that can be examined in Committee. Under data protection principles, all data should be destroyed once it has been used. On reading the Bill, it is hard to know how those principles will be applied. Will data be destroyed on a rolling basis, as each region is switched over, or when the final stage is reached? If it is the former, will the Secretary of State report regularly to Parliament on when regional data have been destroyed? Will people have the option to opt out so that their information is not shared?

Let me echo what my hon. Friend the Member for Forest of Dean (Mr. Harper) said about data security, particularly with regard to Northern Ireland. As the Secretary of State knows, many people there still receive Army or Government pensions and could be put in an enormously difficult position were that to become more widely known. Have the Government considered that, and is the Secretary of State able to assure us that there are sufficient safeguards and protections to guard against misuse of the data in that context? On the wider issue of war pension information, it is worrying that no service charities have been consulted in any way on the security implications of the measure.

This is an important Bill because it provides one of the few opportunities for Parliament to debate the process of digital switchover. That is a massive undertaking by anyone’s standards, yet the Government have placed us in an extraordinary position because we do not know what it will cost, what money will be available, or what the process will be. We
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know almost nothing except that the Government have a woeful track record on major projects.

We are persuaded of the arguments in favour of the digital switchover because we believe that Britain must be at the forefront of the digital revolution if we are to compete in an increasingly technologically driven world. Digital television is here to stay and it has the potential to improve and enhance people's lives and to help communities. We support the principle, but we shall be seeking assurances and answers in Committee, and will be watching carefully to see whether this is one project that the Government can deliver on time and on budget.

5.20 pm

Mr. Russell Brown (Dumfries and Galloway) (Lab): Thank you for calling me, Mr. Deputy Speaker. I am not sure whether I should declare an interest as a BSkyB subscriber, but that said, although I have access to hundreds of channels at home my good lady wife does not allow me easy access to the remote control, so I have a difficulty there.

As the whole House knows, digital switchover comes to the Border television region first and I am encouraged that colleagues on both sides of the House are here to take part in today’s debate. I believe that digital switchover is a major step forward in communication. It brings choice to people, a choice which has been restricted for so many people in the past. That said, I think that we all share the great anxiety that exists out there, and while cost is an issue, by far and away the greatest concern is people’s ability to cope with the technology. I know from contact that I have had with constituents over the past 18 months or so, especially the elderly, that that is of great concern to them.

The Border television region is unique because it covers both sides of the border, as the name indicates, but in my area—I am sure it is the same in Cumbria, as it may well be in the Scottish borders—some people cannot even obtain an analogue signal, so television viewing is impossible for them. However, I know from experiences in my constituency that those who can receive a decent analogue signal get a wide variety of viewing. They get BBC 1 Scotland as well as BBC 1 from the north. They get BBC 2 Scotland as well as BBC 2 from the north. Of course they get ITV, Channel 4 and Five. So for some people, the current analogue signal is an excellent service, and of course their anxiety is shared by all: will they still be able to have those services when digital switchover takes place?

My view, which is informed by discussions that I have had with Digital UK and with those who run Border television, is that there is an element of confidence that those who get a good signal at the moment will see an improvement. But the big question has to be, will those who get nothing at the moment get something when digital switchover happens?

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