Select Committee on Culture, Media and Sport Minutes of Evidence

Examination of Witnesses (Questions 40-59)


25 OCTOBER 2007

  Q40  Philip Davies: One final point, which is admittedly a bee in my bonnet and the other Committee members will be sick of me mentioning it. We have had this restriction on junk food advertising in order to try to sort out the obesity problem, which I felt was a triumph for the nanny state and would not make any difference whatsoever to obesity. One of the points I made at the time was that this would be the start of something bigger and this was the thin end of the wedge. Even I was surprised by the speed with which Alan Johnson announced a couple of weeks ago that the Government would perhaps be going even further with these restrictions before we had any idea of what the impact of the original restrictions was. What discussions had he had with you about that announcement and what impact do you feel that would have on things like children's programming?

  James Purnell: We agreed the announcement in the normal way and agreed the wording of that and indeed we are part of the group which is looking at tackling obesity of which advertising of food is only one aspect. We are absolutely clear that it is important for us to make sure that advertising plays its role in ensuring that we can tackle the increase in obesity, which is a very serious issue in this country. That is why Ofcom introduced the changes that it did. In fact we had already said that Ofcom would be reviewing that in 2008 based on the evidence. The Government are looking not just at Ofcom's role but, as Alan said in his statement in the chamber, the wider impact across the whole range of the media of advertising on obesity, particularly amongst children. That is the responsible thing to do, but it must be based on evidence.

  Q41  Philip Davies: Will it also be based on the impact it will have on broadcasters?

  James Purnell: Of course. That is exactly what Ofcom did and that is exactly the process they will go through in the already-announced review which Ofcom are due to do.

  Q42  Paul Farrelly: Clearly there is an issue about how public service broadcasting content is supported or encouraged in the digital age. At the moment we have the BBC which has had a bit of a kick because it got far less money than it wanted. It is going through massive change now with the cuts which it has been making, the move to Manchester and its responsibilities towards digital switchover. Is it not premature now to talk about top-slicing the BBC's licence fee on top of all that, rather than looking at other options such as setting up a trust fund as they did in places like Canada?

  James Purnell: I want to take issue with the idea that we gave them a kick. They asked for a certain level of funding, as everybody does, making the best case they can. We looked at that. It was thought that greater efficiencies were possible and we gave them a settlement—

  Q43  Paul Farrelly: That loose language is not the question.

  James Purnell: Let us recall what the process was. People said we should not give them a Charter at all. We did. People said we should not give it to them for ten years. We did. People said we should not continue the licence fee. We did. We gave them a six-year settlement, we gave them a settlement which allows them to get an extra £1.2 billion above that if the predictions are realised about efficiency and household growth, so that is a sign of confidence.

  Q44  Paul Farrelly: The question was about top-slicing.

  James Purnell: I just wanted to put that in context. We are not bringing forward proposals for top-slicing at this stage or for a trust or for anything in particular. What we are saying is that public service broadcasting is an important part of British culture, that the BBC and the other public service broadcasters are one of the great things about Britain in my view, but the regime under which that has been achieved is changing incredibly quickly and therefore we have to have serious thinking about how we achieve those goals in a completely different area, in a world in which the spectrum which is being given to people is not the only way to reach the whole of the TV audience. People will be able to do it after switchover by just contracting with digital terrestrial, cable and satellite.

  Q45  Paul Farrelly: Can you give the Committee some idea of how far you have progressed with these reviews and when you expect to come to some conclusions either for consultation or decision?

  James Purnell: We will start the seminars in January; we will have a series of seminars over the next year. We are putting the think tank in place and will advertise for people to join us to work in that think tank shortly. We will be very happy to work with members of the Committee on exactly that. It is a very important task.

  Q46  Paul Farrelly: Has no timetable been set down for a conclusion?

  James Purnell: We have set out the timetable for the PSB review which Ofcom are doing, for our review after that. Clearly we will have to have some conclusions in place before switchover.

  Q47  Paul Farrelly: Before switchover has finished. It has already started.

  James Purnell: Yes, before switchover has finished.

  Q48  Alan Keen: Right from the very beginning of highly entertaining programmes like Pop Idol—and they have been going a few years now—I have never ever trusted them because they have never declared the voting figures. There is a certain amount of deception now because it keeps people phoning in again. Should Ofcom look at that in detail as well? As politicians we are used to seeing everything put out as it is and it has never seemed right to me from when they started five, six, seven years ago. I felt it was wrong for them not to publish the voting figures. Should Ofcom look at that?

  James Purnell: If you are upset about that or people are upset about it you can make a complaint to Ofcom or make representation to the programme makers. It is not for me to say that.

  Q49  Rosemary McKenna: Can we move on to digital switchover? Last week Whitehaven switched to digital. Are you confident that your communications strategy, particularly with help schemes for vulnerable groups, will work over the next five years given that around about 8% of people had not already gone digital in Whitehaven before the BBC2 switch-off?

  James Purnell: I am very impressed by the preparations which Digital UK have made and indeed which all the stakeholders in Whitehaven have achieved and it will be a very useful exercise for us to learn from. We have to be clear about our expectations about this. It is an extremely complicated programme, it is one which is happening all over the industrialised world, all over Europe, all over America and there will be hitches and glitches along the way. Getting millions of people to come over to digital is a very ambitious task. However, I do think it is an important one and it is one which reflects the fact that the UK has had a leading role in digital television and by completing the digital transition and being able both to make sure everyone has access to digital TV but also having new spectrum being released for new applications we shall be able to make sure the UK can stay at the forefront of that digital change.

  Q50  Rosemary McKenna: I am obviously particularly interested in Scotland because Borders is next in line. We have been watching very closely what was happening. I always campaigned for the voluntary sector to be very much involved and Digital UK have done that and that is very, very good. However, I believe one of the issues which emerged last week was that there are groups that the voluntary sector does not cover, particularly the elderly, those people who are fiercely independent and who do not want to have anything to do with the voluntary sector. I believe we learned last week that is one of the areas where there is a problem and somehow or other we have to get around that.

  James Purnell: We work very closely with the voluntary sector and it is something which, as has happened in Whitehaven, we want to do as the programme rolls out. We also want to see whether we can do more with individual volunteers. We are working with local authorities, social housing providers and we will use absolutely every single method we can to reach people. We are writing to everybody who is eligible for the help scheme; there is a wide range of contacting people going on. At the end of the day, if people decide not to take up the help, we cannot force them.

  Q51  Rosemary McKenna: I believe the drop-in centres were very important in that regard. People who had not already done anything at least went to a drop-in centre and got some information and assistance.

  James Purnell: Yes, that is right.

  Q52  Rosemary McKenna: The review will of course make all of these issues clear. One of the issues people are still concerned about is retailers misselling.

  James Purnell: The retailers in Whitehaven have really played a very helpful role. You may have seen that they recently announced they would be phasing out the sale of analogue equipment in those regions where switchover is happening and we very much welcome that.

  Q53  Rosemary McKenna: The so-called digital dividend review, the release of spectrum. Public service broadcasters have been saying that the additional spectrum should be allocated to them so that they can provide HD services on Freeview. Do their arguments stack up?

  James Purnell: There would have to be a very high threshold of persuasion before we started to allocate the released spectrum to existing users without making it available for other people to bid for. The reason we have said that we will pursue market mechanisms to achieve that is because that is the best way of revealing the most economic use for them and that is better than Government deciding on individual uses for that released spectrum. However, Ofcom are working with the broadcasters on whether there is capacity to be found within the existing allocation to digital terrestrial so that more HD services could be provided in that. We have very strongly encouraged the broadcasters to work with Ofcom on that.

  Q54  Rosemary McKenna: So they are not persuaded.

  James Purnell: You might be able to do more services, potentially HD services, through the existing allocation which people have. It would require individual consumers to buy new equipment, but receiving HD channels requires people to buy new equipment in any case.

  Q55  Chairman: While we are on switchover, you will be aware that discussion has begun about when and whether we should switch off the radio analogue transmissions. The radio industry has indicated that it wants a bit more certainty about the future. Have you reached any preliminary conclusions yet?

  James Purnell: We are going to be setting up a group to look at this, think about radio and the issues which have been raised. That is exactly the same approach we used for television. It is worth saying that it is a very significant task. There are millions of sets, sets in people's cars, but we also recognise the very great importance of digital and the figures today show that there has been a very significant increase in listening to digital, for example. We want to work with the radio industry and Ofcom and with consumer groups and with the BBC on that and we shall be making announcements on that shortly.

  Q56  Chairman: So you would now say the question is not whether but when.

  James Purnell: We would say we have set up a group to give us some views on that.

  Q57  Mr Sanders: One of the things which concerned us when we were looking at digital switchover was the possibility of cowboy operators giving poor and dishonest advice to consumers as to what equipment they may need when this process takes place. What we have seen in Whitehaven is a very small-scale switchover. We are now going to move into much wider areas of coverage where the opportunities for misinformation are that much greater. Can you give us an assurance that you will use whatever power you have and liaise with other departments which have enforcement capabilities to crack down on anyone fooling people and misinforming people through this process?

  James Purnell: Yes.

  Mr Sanders: Good answer.

  Q58  Alan Keen: A few quick questions on sport. In June 2006 the Secretary of State said that Sport England were going to be more focused. Sport England are looking at it slightly differently and saying that they have to be more focused because so much money has been taken away from grassroots to the Olympics. How do you see that? Your Department still has to get the transfer of more money through Parliament.

  James Purnell: Two slightly different issues there. In terms of sport, as a Government we have actually found an extra £100 million for school sport and we are making fantastic progress on increasing the amount of sport in schools. We have overachieved our target in terms of the proportion of pupils doing two hours and we now want to give all children the chance of doing five hours. I would not want a perception that we are going backwards on that; we are massively improving that and the Olympics are a great opportunity to raise participation further, indeed one of our key commitments as part of the legacy. As part of our spending review we are talking to Sport England about their goals and arrangements for the next spending review period and will announce that when we have concluded those discussions. In terms of the Lottery Order, we are saying that we are laying today the Order which will enact the funding package and the take from the Lottery to go to the Olympic Lottery Distributor. It is worth saying that it is absolutely appropriate for the Olympics to be one of the things the Lottery funds and indeed I think that was a matter of cross-party consensus when the bid was first put in. In the same way that the Lottery, for example, funded the Millennium Commission—20% of the Lottery in its initial period went to the Millennium Commission—it is appropriate for the Lottery to help to pay for the Olympics. As part of the new public funding package for the Olympics there has actually been an increase from the exchequer of £5 billion and the proportion coming from the Lottery has fallen from just under half to just under 25%. It is a fair ask which we are making of the Lottery Distributor and our goal, as expressed in the memorandum of understanding with the Mayor, is that that should then be repaid from land sales after 2012. We think the Olympics will be great for Britain. We think they are going to be good for sport and indeed for culture and we think this is a reasonable approach. We have laid the Order to do that today and we will debate that in both Houses.

  Q59  Chairman: Debate it in both Houses where? In committee or on the floor?

  James Purnell: That is for business managers to decide. I would not want to prejudge that.

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