Joint Committee on Draft Communications Bill Report


333. Subsections (3) and (5) of Clause 181 represent the first comprehensive attempt to define in statutory form the overall public service remit for television. The details of that remit are based very closely on the terms of Clause 5 of the Agreement between the Secretary of State and the BBC. Accordingly, the first requirement has a Reithian ring to it:

    "that the relevant television services provided by the public service broadcasters (taken together) comprise a public service for the dissemination of information and for the provision of education and entertainment".[640]

334. The proposed terms of the public service remit for television have been the subject of two broad types of comments - those from public service broadcasters and their current regulator seeking to have the remit simplified and those from outside organisations wishing to see the remit strengthened.

335. The ITC considered that the items identified in Clause 181(3) and (5) ought to be seen as a statement of "overall objectives" for public service broadcasters, rather than a shopping list of "requirements", as at present.[641] This view was endorsed by the BBC.[642] Channel 5 was concerned that the Clause as it stood could be read as implying that each public service broadcaster had to cover each genre, rather than being able to play to their particular strengths.[643] ITV questioned the need for the remit to have regard to the days on which programmes are shown and the times of day at which they are shown, arguing that this might give OFCOM authority to intervene in scheduling matters.[644]

336. Others were concerned at any attempt to weaken the public service remit. Public Voice argued:

    "The decision to define public service broadcasting in the legislation is one of the key aspects of the [draft] Bill and must be protected. The definition of public service broadcasting in the legislation is a cornerstone of protection for citizens' interests and must remain as a strong benchmark for measuring performance."[645]

—  Professor Vincent Porter of the Voice of the Listener and Viewer was concerned that even the existing concept of requirements applying to all broadcasters "taken together" might lead to the requirements on commercial public service broadcasters being lightened and more difficult or minority aspects of the remit being transferred to the BBC.[646] The Voice of the Listener and Viewer and Professor Eric Barendt both questioned whether OFCOM's ability to "have regard to the desirability" of the general requirements in subsection (2) being met in such a way as to ensure that the specific requirements of subsection (5) are also satisfied was sufficiently strongly worded.[647]

337. In addition to comments on the framework established in Clause 181, proposals were also made for additions to the detailed requirements. Foremost among these was the suggestion, that was supported both in formal evidence and in many contributions to our online forum, that international issues ought to be included in the range of programming as well as religion and social issues.[648] A similar case can be made for the inclusion of "science".[649]

338. In general terms, we consider that the Government has struck the right balance in its definition of the public service remit. We agree with the proposition that the term "objectives" more accurately reflects the nature of the commitments involved than "requirements" and we recommend that Clause 181 be amended accordingly. We also consider that it is right that a set of objectives for all public service broadcasters should be more detailed than is necessary for the BBC with its long tradition of public service broadcasting and we therefore recommend that the Government gives careful and sympathetic consideration to the case for including fuller descriptions of topics for programming in Clause 181(5).

339. Clause 181 also proposes that OFCOM undertakes periodic reviews of the public service broadcasting remit and publishes a report on that review. The first review is to take place one year after the coming into force of the provision, with subsequent reviews every three years. The ITC argued that such reviews ought to be held annually, in order to inform the annual programming statements of individual licensees and to prevent a frenzy of interest focused around the triennial exercise.[650] This view was shared by ITV, Channel 4 and Channel 5.[651] Chris Smith also thought that these reviews should be more regular.[652] The ITC made proposals with the aim of enabling the reviews to be distinct in purpose from arrangements for oversight of individual commercial public service broadcasters, even if the two processes took place with the same regularity.[653]

340. Tessa Jowell thought it was important to maintain a distinction between OFCOM's specific reporting duties in respect of Channels 3, 4 and 5 and the more strategic review of the performance of public service broadcasting.[654] We agree with Tessa Jowell that it will be important to maintain a clear distinction between the oversight by OFCOM of the programme policies of the commercial public service channels and its reviews of public service broadcasting as a whole. It would be very difficult to maintain that distinction if both exercises took place with the same regularity. At the same time, we are concerned that, given the speed of change in broadcasting, a three year wait could be too long. We recommend that Clause 181(1) be amended to provide that OFCOM reports on the fulfilment of the public service remit are to be published every two years.

341. We have rejected the proposition that reviews of the public service remit be undertaken annually in part because we are keen to see the reports arising from the reviews as major events that play a central role in public debate on public service broadcasting. We make further recommendations with this aim in mind. First, we recommend that OFCOM be required to conduct its review with the purpose of sustaining and strengthening public service broadcasting in the United Kingdom. Second, we recommend that OFCOM be required to review the ecology of public service broadcasting, including the costs and financing of public service broadcasting. Third, we recommend that OFCOM be required to report on the contribution to public service broadcasting made by broadcasters other than the BBC, S4C and holders of licences for public service channels.

342. Clause 188 gives the Secretary of State power to amend the main elements of the definition of the public service broadcasting remit in Clause 181, but she may only do so following a recommendation by OFCOM and subject to affirmative resolution procedure. The Voice of the Listener and Viewer expressed concern at the scope of this power and at the absence of any requirement to consult the public as opposed to the broadcasters concerned.[655] This concern was echoed by BSkyB.[656] We recommend that Clause 188 be amended to provide that an order to amend the public service remit in Clause 181 can only be made by the Secretary of State in response to a recommendation made by OFCOM in the reports arising from its periodic reviews of the public service remit and even then only after a full public consultation on that recommendation.

343. Clause 182 sets out the proposed remits for the commercial public service broadcasters. The public service remit for every Channel 3 service and for Channel 5 is envisaged to be "the provision of a range of high quality and diverse programming". The ITC expressed surprise that the remits for these channels were proposed to be the same, given their distinct roles and very different revenues; the ITC proposed that the ITV remit be amended to refer to ITV's regional role and to its commitment to original production and landmark productions.[657] ITV itself seemed sympathetic to this notion.[658] Tessa Jowell said that "we have made absolutely clear that we see the continuation of network services of ITV and, therefore, the specific regional characteristic of ITV as critical, and that is reflected … on the face of the Bill in relation to the remit".[659] We recommend that the public service remit for every Channel 3 service in Clause 182 be amended to require the provision of a wide range of high quality and diverse programming which, in particular, includes a substantial range of high quality original production and satisfies the tastes and interests of the part of the United Kingdom for which that service is licensed.

344. The public service remit of Channel 4 as set out in Clause 182(3) is "the provision of a broad range of high quality and diverse programming which, in particular -

    (a)  demonstrates innovation, experiment and creativity in the form and content of programmes;

    (b)  satisfies the tastes and interests of a culturally diverse society; and

    (c)  exhibits a distinctive character".

—  This bears a close resemblance to Channel 4's existing remit in section 25(1) of the Broadcasting Act 1990. ITV argued that Channel 4's remit had been "somewhat reduced" and regretted the absence of a reference to the desirability of Channel 4 catering for tastes and interests not generally catered for by other channels.[660] Channel 4 did not consider that its remit was being reduced, only put in more positive terms, and was sympathetic to a suggestion from ITV that a reference to Channel 4's wider educational role (in addition to its specific requirements in respect of schools programming set out in Clause 198) might be added to its remit.[661] We welcome and support Channel 4's public service remit as set out in Clause 182(3). We recommend that the Government consider the case for inclusion of Channel 4's educational role in that remit.

345. As part of Clause 188, it is proposed that the Secretary of State should have a power to amend the public service remits of Channels 3, 4 and 5 following a recommendation by OFCOM. Channel 5 argued that this power would "not help in providing any certainty to broadcasters and their shareholders as to what future levels of public service broadcasting commitments will be required of them".[662] Dawn Airey suggested that a broadcaster ought to be given at least a year's notice of any change in remit.[663] A view was also expressed by the commercial public services broadcasters and the ITC that the power to amend these remits ought to reside with OFCOM.[664] Tessa Jowell saw it as important to maintain the power to amend the remits to ensure that legislation had "the necessary flexibility" to stand the test of time. She envisaged that the power would be used "with due regard to the necessity and the possible impact on investment decisions".[665]

346. While flexibility and adaptability are general merits in the legislative framework, we are not convinced that this applies in the case of the remits of the public service broadcasters. These are set at a very high level of generality. Although we have recommended that the ITV remit ought to be more stretching than that for Channel 5, we support the general notion of maintaining the brevity and simplicity of these remits. They appear to us to define the basic functions that Channel 3 services, Channel 4 and Channel 5 must perform in order to justify their privileged spectrum access. If the commercial positions of the channels change, there is a great deal of flexibility inherent in the licensing regimes. If the public service remits had to be changed, this would call into question the entire framework for public service broadcasting to be established by the new legislation and would justify Parliament looking afresh at the entire issue by means of considering further primary legislation. The suggestion that the order-making power reside with OFCOM, rather than the Secretary of State acting solely upon a recommendation by OFCOM, would make the matter worse not better, since it would entail one less safeguard for what could in effect be a very significant change. We oppose the power to amend the public service remits of licensed public service channels by means of secondary legislation and recommend accordingly that this provision in Clause 188(1)(a) be removed.

347. One of the requirements of the overall public service remit is that the public service channels "provide, for the purpose of facilitating fair and well-informed debate on news and current affairs, a comprehensive and authoritative coverage of news and current affairs in, and in the different parts of, the United Kingdom and from around the world".[666] This general objective is reinforced by a more specific requirement on commercial public service channels set out in Clause 191 to "broadcast high quality domestic and international news programmes and current affairs programmes throughout the day and in peak viewing hours".[667] The obligation to broadcast current affairs programming will be a new requirement for Channel 5.[668] ITV did not take issue with these obligations.[669] The ITC, Professors Steven Barnett and Janet Seaton and the National Union of Journalists all expressed concern at the failure to include in Clause 191 the existing requirement on Channel 3 licence holders under section 16(2)(a) of the Broadcasting Act 1990 to devote "a sufficient amount of time" to such programming.[670] We can see no good reason for the exclusion of this phrase, which sends a signal regarding expectations about the length of news and current affairs programming in peak time that we suspect would be unintended. We recommend that Clause 191 be amended to retain the existing legal obligation on Channel 3 licensees to devote a sufficient amount of time throughout the day and in peak viewing hours to news and current affairs programming.

348. Clauses 183 and 184 establish a system for what is termed "self-regulation" for the licensed public service channels. Clause 187 provides for reversion to "detailed regulation" to enforce the public service remits in certain circumstances. In essence, the channels are required under Clause 183 to make annual statements of programme policy, including a report on their own performance in the previous year, in accordance with guidance issued by OFCOM. They are required by Clause 184 to consult OFCOM before making a change in programme policy. The delivery of remits and regulation through statements of programme policy was seen as valuable by Channel 4, since the statement "forces each broadcaster to assert the best parts of themselves, so when subsequent pressures come upon you in the course of the year it sets out ambitions to which you have signed up".[671]

349. A number of witnesses opposed the principle of self-regulation outright or expressed concern about the way it would work in practice. Equity considered that, during the "trial run" of statements of programme policy this year, "the ITC's Annual Report was severely lacking in any guidance or criticism of the broadcasters and merely seemed to endorse or report back what the broadcasters themselves thought of their achievements".[672] BECTU wished to see OFCOM "have a proactive and interventionist role in order to secure quality public service broadcasting standards".[673] Professor Sylvia Harvey saw self-regulation as "a risky proposal that could be seen to place corporate interests before audience satisfaction".[674] Both she and the Campaign for Broadcasting and Press Freedom saw the system for reversion to detailed regulation under Clause 187 as a case of "shutting the stable door after the horse has bolted".[675] Public Voice also expressed concern that, given that the provisions for detailed regulation could only be invoked if there was a serious failure in respect of the public service remits which was "not excused by economic or market conditions", this economic defence would be prayed in aid whenever failure was alleged.[676]

350. The ITC and the commercial public service channels had rather different concerns about the proposals. ITV viewed the provisions as "over-prescriptive" and particularly criticised the possibilities for OFCOM to interfere in the drafting of statements of programme policy opened up by Clause 184.[677] Channel 4 thought that this requirement "threatens to reduce 'self-regulation' to a meaningless aspiration".[678] The ITC endorsed the view that the provisions were "more complex and heavy-handed than originally intended and less effective".[679] The ITC proposed that the system for prior approval by OFCOM for changes of programme policy be replaced by an annual report by OFCOM on the performance of the licensees in fulfilling their programme policies.[680]

351. The Government has faced a considerable challenge in making statutory provision for "self-regulation" by the licensed public service broadcasters. It appears that in some measure the current proposals are less deregulatory than the current system as now operated by the ITC. At the same time, the sanctions in case of failure are more difficult to invoke than those currently available to the ITC. Accordingly, we consider that the proposals could be re-balanced in two ways. First, we recommend that the provisions for prior consultation with OFCOM on changes of programme policy as set out in Clause 184 be superseded by a system of annual reports by OFCOM on the performance of each licensee in relation to the relevant statement of programme policy.

352. Second, we wish to see OFCOM have additional regulatory tools at its disposal in relation to licensees that reflect changing economic or market conditions, but fall short of a return to detailed regulation. We recommend that OFCOM be given a power to review the financial terms of Channel 3 and Channel 5 licences at the mid-point of any licence and to vary licence payments for the remainder of that licence period. In view of this added flexibility to ensure the correct balance between the benefits of spectrum access and the burden of public service obligations, we further recommend that the possibility for exemption from detailed regulation under Clause 187(2)(a) as a result of failure to fulfil public service remits when such failure is due to economic or market conditions be removed.

353. In addition to the specific regulatory provision for detailed regulation and the financial sanctions and possibility of licence revocation that apply to all licence-holders, the Government proposes to establish an additional regulatory lever for OFCOM through the provision in Clauses 150 and 152 that all rights to renewal of Channel 3 and Channel 5 licences will cease at the end of 2014. This proposal has been criticised by both Channel 5 and ITV, who argue that this system will provide a disincentive to long-term investment.[681] The ITC characterises the current system of optional renewal in year six of a ten year licence, which ITV and Channel 5 wish to see continue, as a "one-way bet" for the current incumbents.[682]

354. In a supplementary memorandum, the ITC advanced what it saw as several disadvantages to the 2014 "cut-off". The ITC argued not only that it would serve as a disincentive to investment, but also that it was the opposite of deregulatory in its effect. The ITC proposed an alternative way forward based on a charge separate from the general licence payments to reflect spectrum value. The spectrum charge could be adjusted to reflect the value of spectrum used by ITV licence holders and Channel 5 before and after digital switchover without the uncertainty and disruption caused by the 2014 "cut-off".

355. Twelve years is a long time in broadcasting. We have concluded that the Government is right in principle to establish mechanisms for measuring the overall value of Channel 3 and Channel 5 licences beyond analogue switch-off. An explicit process of licence allocation for the years after 2014 has advantages, including as a safeguard for the regional character of ITV licences. However, there is a danger that the process may serve as a disincentive to invest in the years before then. We recommend that, in its response to our Report, the Government set out its views on the proposal by the ITC for separate spectrum charging as the best way of capturing changes in licence value before and after digital switchover and clarify how it envisages the new allocations being made for the years after 2014.

640   Clause 181 (5)(a). Back

641   Ev 1. Back

642   Q 524. Back

643   Ev 233. Back

644   Ev 439, para 33. Back

645   Ev 308, para 8.4. Back

646   Q 799. Back

647   Ev 167-168, Ev 303, (2b).2 Back

648   Ev 29, passim; Ev 308, paras 8.5-8.6; Q 802. Back

649   Q 802. Back

650   Ev1, paras 17-18; Q 22. Back

651   Ev 439, para 32; Ev 233; Q 581. Back

652   Ev 550. Back

653   Ev 1. Back

654   Q 1013. Back

655   Ev 302, para 2 (b) 4. Back

656   Ev 189. Back

657   Ev 1, para 16; Ev 1; Q 20. Back

658   Ev 439, paras 34, 38. Back

659   Q 1012. Back

660   Ev 439, para 35. Back

661   QQ 574-575; Ev 439, para 35. Back

662   Ev 233. Back

663   Q 694. Back

664   QQ 559, 694; Ev 1. Back

665   Q 1014. Back

666   Clause 181 (5) (c). Back

667   Policy, para Back

668   Ev 233. Back

669   Q 562. Back

670   Ev 1, para 28; Ev 439, para 6 (iii); Ev 519, para 3.3; Q 20. Back

671   Q 581. Back

672   Ev 329, para 9. Back

673   Ev 331, para 12. Back

674   Ev 484, para 2.1. Back

675   Q 802; Ev 484, para 2.3. Back

676   Q 802; Clause 187 (1) (b). Back

677   Q 558; Ev 439. para 36. Back

678   Ev 202, para 4.82. Back

679   Ev 1. Back

680   Supplementary Memorandum submitted by ITC. Back

681   Ev 439, paras 27-30; Ev 233; QQ 570-572, 703-708. Back

682   Appendix 107; Ev 218. Back

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