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Lord Beloff: My Lords, does the Minister agree that the poverty of many of the Palestinians is one of the

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main problems because it provides opportunities for recruitment into terrorism, which is, after all, the main obstacle to peace? As the Minister stated, the EU is the major donor of aid to the Palestinians. Is there machinery in place to ensure that the aid goes to the poor masses of the Palestinians and is not syphoned off for luxury living by Mr. Arafat and his associates?

Baroness Symons of Vernham Dean: My Lords, the decline in Palestinian living conditions has been a matter of major concern. I hope I have outlined to your Lordships the action being taken by the EU to ensure that aid gets to where it is needed. There is a continuing and important role for the European Union to play in that respect. The recent ad hoc liaison committee and consultative group meetings in Frankfurt focused on how the international donor community can support the Palestinians directly and through the NGOs with advice, aid allocation and project implementation.

Lord Redesdale: My Lords, considering the recent fall in the living standards of those living in the camps and the standard of services being provided in the camps, can the Minister say whether Britain and her EU partners are considering an increase in the UNRWA budget?

Baroness Symons of Vernham Dean: My Lords, the EU is already the largest donor to the area. I believe that it was a United Kingdom initiative. However, as a result of that, the European Union has engaged Israel in a dialogue to find practical ways to ensure that the money gets through to the Palestinians, to the economy, in ways that Israel will find compatible with its security. Obviously that takes a certain amount of application and work. However, we and the EU believe that the existing initiatives I have described as regards what happened recently in Frankfurt will deliver tangible benefits to the Palestinians.

Lord Cocks of Hartcliffe: My Lords, would the Minister invite the noble Lord, Lord Hylton, to use some of his wide-ranging foreign energies to put pressure on the oil-rich Gulf states to make a contribution to the Palestinian economy to strengthen the peace process?

Baroness Symons of Vernham Dean: My Lords, I am sure that all people of goodwill, both within the immediate region of Palestine and Israel, and indeed elsewhere, should be persuaded to do what they can to support the Palestinian economy. There are a number of ways in which that can be done, through the trading alliances--which I have already described, and which the EU is trying to promote between Egypt and Jordan who are, in fact, engaging in that process--by directly supporting the infrastructure and, most important of all, in supporting the peace process. Unless we get the peace process right, there will be no prosperity for the Palestinians.

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West Wales and the Valleys: EU Funding Status

3.14 p.m.

Lord Islwyn asked Her Majesty's Government:

    What progress has been made towards securing Objective 1 status for areas of Wales suffering from high levels of unemployment, poverty and lack of investment.

The Minister of State, Home Office (Lord Williams of Mostyn): My Lords, the European Union has confirmed that the gross domestic product of the West Wales and the Valleys NUTS II area for the period 1994-96 is around 71 per cent. of the European Union average. If the Commission's current proposals for NUTS II eligibility are approved by member states, this area will qualify for Objective 1 status. The subsequent approval of an Objective 1 programme for the area will be subject to the satisfactory conclusion of further negotiations with the Commission.

Lord Islwyn: My Lords, I thank the Minister for that most helpful reply. Can he confirm that Objective 1 status is only given to areas suffering considerable deprivation and that West Wales and the Valleys fall into that category? Can he give the up-to-date position regarding matching Treasury funding, bearing in mind that without that funding there will be no Objective 1 status? That would be a tragedy.

Lord Williams of Mostyn: My Lords, my noble friend Lord Islwyn is quite right in his description of the Objective 1 categorisation. Matching funds will be required at present. The question of funds on a matching basis after the year 2000 remains for negotiation. I can tell your Lordships that the timetable looks promising. The European Council should come to a conclusion this month, and the European Parliament should do so by the end of June.

Baroness Ludford: My Lords, can the Minister assure the House that the claims made by London to EU structural funds are not disadvantaged by the recent statistical exercise? That exercise gave a distorted picture of inner London as the wealthiest area in Europe by attributing the entire wealth of the City of London to the citizens of some of the poorest boroughs in the country such as Hackney, Southwark, Tower Hamlets, and so on. The income of a City trader living in Surrey, at £1 million, was attributed to council tenants living in one of those deprived boroughs. Can the Minister ensure that that exercise, which pictured inner London as the wealthiest area in London, despite the deprivation, does not prejudice London's claims to EU structural funds?

Lord Williams of Mostyn: My Lords, such question as I could disentangle does not seem entirely focused on Objective 1 status for West Wales and the Valleys. I see that the noble Viscount, Lord St. Davids, is about to ask

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a most helpful question. He will be able to confirm that some people who live in inner London are extremely well off!

Viscount St. Davids: My Lords, pace! Will the Minister go further and give the House an assurance that the Government's financial contribution to Objective 1 status will be met in full by the Treasury and not deducted from the Welsh block grant?

Lord Williams of Mostyn: My Lords, I cannot give that assurance. I am sure that the noble Viscount did not expect me to fall into that particularly well-laid trap. We are adamantly determined to secure the very best possible advantage for a deprived area, as the noble Lord, Lord Islwyn, described it. The area suffered very intensive, historic consequences of the rundown of heavy industry. It is in need of, and a worthy candidate for, such funds as are available from our friends and donors in Europe.

Lord Elis-Thomas: My Lords--

Lord Brookman: My Lords--

Baroness Jay of Paddington: My Lords, if we do not all confine ourselves to asking short questions and watching the clock, no one will get in. I suggest it is the turn of my noble friend.

Lord Brookman: My Lords, maybe that is because I am Welsh. I was assured by the Minister's reply. However, can he confirm that massive job losses resulting from mining and steel industry closures in Wales have had a dramatic effect upon unemployment and, therefore, the old subject of Objective 1 status is extremely vital as of now?

Lord Williams of Mostyn: My Lords, yes. That is one of the bases for the conclusion, an unhappy one, that the GDP of the West Wales and Valleys NUTS area is only 71 per cent. That is part of the necessary qualification for Objective 1 status. The recent history of Wales, with job losses, contributed to that. I do not know why everyone gets so excited about Questions on Wales.

Business of the House: Debates this Day

Baroness Jay of Paddington: My Lords, I beg to move the Motion standing in my name on the Order Paper.

Moved, That the debate on the Motion in the name of the Lord Bragg set down for today shall be limited to three-and-a-half hours and that in the name of the Lord Kennet set down for the same day to one-and-a-half hours.--(Baroness Jay of Paddington.)

On Question, Motion agreed to.

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Public Service Broadcasting

3.20 p.m.

Lord Bragg rose to call attention to the future of public service broadcasting in the United Kingdom; and to move for Papers.

The noble Lord said: My Lords, first I must declare an interest. I was trained by the BBC and worked there for many years in the World Service, the Third Programme and Huw Wheldon's "Monitor" programme. For more than 20 years I worked in ITV, currently making arts programmes for LWT and I work on Radio 4. I am engaged with two media and two organisations I greatly respect.

What distinguishes public service broadcasting in this country is that over decades it has been so successful; massively and uniquely well-funded and heavily protected. As a consequence, for many years it has been able to call on and pay for the finest talent across the board. "Public service broadcasting" still, just, defines public broadcasting in Britain today. My hope is that it will continue to do so, despite great turbulence in the airwaves. My fear is that the BBC, its chief guardian, may be set on an unnecessarily dangerous path at the moment. My intention is, as George Orwell put it, "to tell it how it is".

I believe that strong public service broadcasting is essential to ensure that those two powerful media--radio and television--remain vital, democratic and a full reflection of this country's variety. As I want to devote most of my time to the BBC I should like to begin by stressing that, though the BBC is the cornerstone of public service broadcasting, it is by no means the only block in the edifice. Let me take television as an example and choose not the content of Channel 4 which is so very like the content of BBC2, but rather the more unlikely comparison of ITV--a big established commercial channel--with BBC1, the BBC's flagship channel.

I should like to note, first, that of all public service UK TV broadcasters, the BBC is the only one not to have positive programme obligations placed upon it. Each of the ITV companies has such an obligation, as have Channels 4 and 5. According to information published recently by the BBC itself, in 1997-98 ITV produced more than twice as much arts and music programming as BBC1 and 20 per cent. more than BBC2. ITV produced more home-grown, home-produced, home-written drama than BBC1 and BBC2 combined. ITV showed more documentaries and features than BBC1. ITV, on that snapshot count, is at least an equal public service broadcaster with BBC1. Frankly, it is rather worrying when the BBC continues to assert that everything in the public service broadcasting garden is wonderful and theirs. It is not true and it does not help.

Where does that leave us? It suggests that it would do no harm for the BBC to institute a table of genre obligations such as exists in ITV and publish a defined percentage of programmes meeting that definition. Yet, despite the figures, I would argue that public service

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content in all terrestrial channels is, or ought to be, underpinned by the BBC because that is its prime purpose and should continue to be so--more so.

An even more brutal question is: do we need to go to BBC television for anything specific at all? Sports, movies, soaps, drama, comedy, news, documentary, arts, local programming--it is possible almost everywhere to find adequate or preferred alternatives to BBC television. Given that it is television that drives on the licence fee, that must raise serious questions. And with the proliferation of channels, the arrival of the Internet and the convergence of television and the Internet, there will inevitably be a fragmentation of audiences--the view most cogently expressed by Gerald Kaufman. As to a large extent the public service remit presupposes a mass audience, where does that leave the licence fee after 2006? "Why pay it if you don't watch it"? is a question which must be answered before it is used to wound.

At present for about £100, by any comparison, the BBC offers outstanding and remarkable value. There are many, including myself, who would pay more. There are many to whom the sum is a burden, particularly if they can live without the BBC. And even for the majority which calmly accepts it, the licence fee is still an imposition and as such it must justify and be seen to justify its existence.

So what is it about the BBC which merits its monopoly of almost £2 billion a year of public money? Is it its fine record and traditional character and reliability? Yes. But the loss of the cricket, to take but one example from a general haemorrhaging of sport, is a small but definite indicator that traditions can be lost and therefore character can be changed. Its particular, its especial programme skills; is that what makes the BBC worth the licence fee? Yes again. Yet none nowadays would deny that other outfits are every bit as skilled and, more to the argument, the same independent production companies such as Hat-Trick, or the same writers such as Jimmy McGovern and the same directors and skilled crafts move from channel to channel as freely or as expensively as footballers move from club to club. The hard edges are beginning to blur. Whose channel is it?

Radio here provides an almost wholly different platform. Apart from Radio 1 it is an exemplary case; and, of course, I can understand that BBC1 and Radio 1 must reach out for the wider audience. "Most people shall watch or listen some of the time" is an old and tested BBC mantra--I hope the charm keeps working. But if it looks and sounds just like its competitors, then a feeling of unease will grow, legitimately.

The twin worries that commentators have expressed are the size of the BBC bureaucracy and, more importantly, the nature of the BBC's commercialism. Both stem, critics say, from the BBC's expansionist tendencies--tendencies which even friends of the BBC believe are doing harm to its fundamental remit and its justification for state funding. Perhaps one clear way of expressing the remit is that the BBC must concentrate on that which the commercial market cannot fill. This is not all it should do of course, as I have said by

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reference to the purposes of BBC1 and Radio 1. But if it fails to do that core job it will be vulnerable to serious challenges, especially when the going gets tough.

For instance, I wonder whether the BBC really needs to spend £30 million a year--at least--on a 24-hour rolling news service when Sky and CNN already cover that market. And does the licence fee payer really have to pay for BBC On Line when the FT, Microsoft, NBC and BT are already providing that service in a commercial market? And does the BBC need to invest public money to the extent of £200 million a year for the next 10 years on loss-making digital channels which will lose money for years and which the commercial sector will, and does, produce? Given the general unhappiness among BBC producers at the slashing of their budgets and given the strains that that puts on BBC's resources and performance, I am reminded of the late Sir Huw Wheldon's remark that,

    "the BBC is the sum of its programmes, and no more, and no less".

The widening range of commercial activities means that the BBC has grown a gigantic corporate centre noted with amazement by, among others, Ray Snoddy in The Times recently. That costs the BBC at least £80 million a year and we must ask: is it all necessary? Think what even half of that would do for programmes! And surely, more importantly, this leaves the BBC with a split mission. What sort of organisation does it want to be? Is it becoming a commercial company maximising its assets or is it there to use the British licence fee for the British public at the highest programme level? One might say both. But that may be too easy an answer.

The BBC cannot be a little bit pregnant. If it is going to play on the global commercial market field, then its competitors have every right to demand and get a level playing field. Otherwise they will always be at a disadvantage against a body backed by a massive and fixed flow of state support. That could become an inflammatory issue. Other broadcasters could bite back in many ways--one way might be in the demand for some percentage of public funds for their public service broadcasting commitments.

I am going to suggest a way to steer the BBC from a collision course which seems to me to be facing them in the market. No one is asking the BBC to give up commercial life. Its name adds money to the programme-making pot. BBC Worldwide does that. But it is wholly owned and run by the BBC at the moment and so bound to raise questions, cause problems, cross lines, get into battles with others in the competitive field, which will confuse and, I believe, could ultimately damage the BBC.

Why not set up a wholly independent commercial structure which would house all UK television programmes? They would include the BBC, ITV, Channels 4 and 5--all of them. At present we have one of the world's most successful television industries, but we do not punch anything like our weight on the world market. It is ludicrous that in the USA buyers simply play off British companies one against the other and drive our prices down. Despite our massive industry and all the

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compliments we and others pay ourselves on it, from the world market in 1997 we collected the accolade of a record balance of trade deficit--£272 million.

One of the principal reasons for this is that there are far too many organisations selling British programmes. We have no critical mass so we have no clout. We should be selling whole channels, not competing with each other to sell programmes. I suggest that one "UK International Programme Distribution plc" could sort that out. It would build us up on the market, compete world wide and pour money back into the BBC and other companies for better programmes. A new broadcasting Bill could examine this and other matters. It would be useful to know when it is considered appropriate to introduce such a Bill.

Going back to its roots, the BBC could show a clean pair of heels to all of us in the large and growing market of public intelligent broadcasting. The BBC is perfectly placed to command this territory and dominate a growing English-speaking world market.

As I have concentrated on television, I would point to Radios 2, 3, 4 and 5 as an example, performing outstandingly in the fields that they occupy. Personally, I wish for more discussions on Radios 3 and 4 and about as much time devoted to lectures and seminars and arguments as to music. But that is a personal and a marginal point.

By concentrating wholly on programmes of quality--as happens largely in radio--think what the BBC could achieve in television. At a time when leisure and life expectancy are increasing, the British population is revealing a growing enthusiasm for continuing education and an appetite for knowledge and culture. Could not the BBC seriously address this in science, history, education, the arts, archaeology, drama and documentary and put extra resources there, bringing in much more talent as it has done so successfully with the natural history area in the past and as it has done in its time with new drama and comedy? No one else anywhere could move in here on the scale of the BBC; it could be an inspiration.

Instead of becoming more and more like other channels and competing in a global market which will make it more and more like other institutions, it should surely aim to be different from them and with profit to its viewers and to its listeners. It could be so successfully different.

Clearly, some years ago the BBC had a fright when it feared that in the last phase of the Thatcher government it would be asset-stripped and deprived of much of its inheritance. To fight against that and to turn that tide was a great achievement and there have been other achievements since. But now, as one who is a strong supporter of the BBC and who wishes it nothing but well, I say to it--look out and look at what you can uniquely do. The remit is the way forward.

Public service is enough of a responsibility and an opportunity. For over 75 years the BBC has stood for something singular and been seen to be singular. If that goes the BBC will eventually go and a great chapter in our social and cultural history would have come to an

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end. It need not be like that. But the dangers are clear and the time to act is now. My Lords, I beg to move for Papers.

3.33 p.m.

Lord Inglewood: My Lords, I begin by congratulating my fellow Cumbrian, the noble Lord, Lord Bragg, on moving this Motion. One of the endearing characteristics of Cumbria is that things are done differently there and down here he is not allowed to be "my friend". I, too, look forward to hearing the Minister wind up and I hope that I am allowed to ask him not to be too wordy as I have a train to catch and the timetable will be tight.

I have a number of interests in the general area of media and broadcasting, which I hope and believe I have fully declared in the Register.

The topography of the broadcasting landscape in this country has evolved in a very ad hoc and typically British way, but I do not believe that it has served the country any the worse for that. I suppose that if one were designing it from a blueprint, one would not necessarily start from here.

As the noble Lord, Lord Bragg, pointed out, it is important to understand that public service broadcasting in this country covers both radio and television. I believe that radio does not get the attention that it deserves, least of all from me because I shall make my few comments about television. As the noble Lord said, the television sector covers not only the two BBC channels, but also Channels 3 and 4, S4C and Channel 5. These channels collectively provide the so-called bouquet of television offerings, which comprise public service broadcasting in this country.

They owe their very being to spectrum scarcity which dominated broadcasting until the dawn of the multi-channel world brought about by satellite and cable, which has been accelerated in particular by digital technology and various on-line services, not to speak of general convergence with telecoms.

The circumstances which gave birth to the core bouquet of public service channels are now disappearing before us. That poses a real challenge for policy makers and politicians which needs to be addressed.

Since the BBC first began broadcasting, the rationale for public service broadcasting has changed and the practical manifestation of the rationale has also changed. Given the abundance of potential transmission systems, there is no longer any real spectrum scarcity. Indeed, as the noble Lord, Lord Bragg, pointed out, credible content may well become the main constraint on broadcasters. Certainly, its value has soared over recent years, as can be seen from the market price of the broadcasting rights of major and popular sporting events.

Against that background I believe that the time has come for a careful reappraisal of the purpose of public service broadcasting and where it belongs in the digital world into which we are now going. I wish to put on record that public service broadcasting has served the country well in the past and that the concept, as it has

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become known in this country, albeit changed by changed circumstances, has a real and important role for the future.

In this context it is interesting to note that attached to the Treaty of Amsterdam there is a protocol which recognises the place of public service broadcasting and the legitimacy of what the European Community would define as state aid to support it. While in my view these are unequivocally issues for member states, the international nature of broadcasting, especially satellite broadcasting, in a language which is either shared by more than one member state or is used very widely across the Community as a whole, gives the contemporary broadcasting industry a pan-national character which in turn requires a pan-national framework of rules within which it must operate.

It is very likely that many of the issues which are at the heart of this debate will come before the committee which is inquiring into the future funding of the BBC under the chairmanship of Gavyn Davies. It is the case that its terms of reference are narrowly set, but I cannot see how one can take a view about the right way to fund the BBC without knowing what the BBC should be doing. In the middle of a revolution--for that is where we are, in broadcasting terms--that is a little unclear. It is particularly so if, as I suspect, it might be unrealistic to think of providing enough money for the BBC to do everything that it has been doing for some time and to take on new activities, for example, on-line and 24-hour news services. It may well be that there will be a need to clarify and to think through very clearly exactly what the BBC should be doing in the context of contemporary circumstances.

Against that background, I believe there is a need for a re-definition of public service broadcasting for the next millennium because only then can one identify, for example, what the BBC might do, how it might do it and how in turn that will be paid for. What is true for the BBC is also true for Channels 3, 4, S4C and Channel 5 because a change on one part of the public service broadcasting waterfront reads across to, and has implications for, all the others.

When I had the great privilege to be the Minister for broadcasting between 1995 and 1997, I was responsible for the passage through Parliament of the Broadcasting Act 1996. We were very clear that the changes that we were bringing about--or, to be strictly accurate, we were helping to bring about--were not an answer in themselves. They were not a destination on a journey, rather they were merely a stopping point on the way to the future. I am quite clear that we were right to look at it in that way.

I believe that the next resting place on that particular journey, which is propelled by technology and not, I believe, by politicians, is a consideration of precisely what public service broadcasting should be doing in the multi-media, digital world of the next millennium.

In answering that, I believe it is important that the topic is canvassed widely and generates continuing controversy and dispute within and without political and broadcasting circles. As the noble Lord, Lord Bragg, pointed out, getting this right will matter a very great deal to everyone in this country.

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I am not actually sure that at this stage there is any need for the Government to do anything. Like all Members of your Lordships' House who have been Ministers, I know that governments like doing things: it gives the appearance of being in control, which my experience in the Department of National Heritage suggests is not necessarily so in the context of the broadcasting industry, because the Government set the framework within which others operate. I believe that that is how it should be.

However, I hope that the Government will make it clear that there are some very serious questions which need answering about the future purpose and form of public service broadcasting which government, of whatever political persuasion, will have to address in the reasonably near future. I hope that they will give a lead and encourage academics, broadcasters, journalists and--dare I say it?--even politicians, to start debating the matter.

3.41 p.m.

Lord McNally: My Lords, it is a great privilege to follow the well-informed introduction of the noble Lord, Lord Bragg, and equally well-informed comment from the noble Lord, Lord Inglewood. I should first declare an interest. I am president of the British Radio and Electronic Equipment Manufacturers' Association--saying it takes up almost the seven minutes of my time. I have received a large number of briefings from ITV, Channel 4, the BBC, commercial radio and others which could form the basis of a good hour-long speech. However, we have seven minutes each--or a little under.

Therefore, perhaps I may begin by saying that my real interest in the debate is that I believe that the media, and broadcasting within the media, form part of the essential cement of a democratic society. Like the European Commission in its report on the digital age, I believe that,

    "a society which restricts access to information or freedom of expression to a privileged few is no longer a democratic one".
The noble Lord, Lord Inglewood, says that we are in the midst of a revolution. That is an often overworked word, but in this case it is true. New technologies and converging technologies will change in a way probably not experienced since the BBC was founded over 75 years ago; in other words, broadcasting is undergoing a fundamental change.

I differ from the noble Lord, Lord Inglewood, in my belief that the Government cannot be passive in the face of this revolution. I say that because there are powerful commercial interests at work. If the Government are passive, we may find that it is those who are looking for shareholder value rather than the public interest who set the pace and the direction of change. So we look to the Government--I am sure that Ministers from the previous administration recognise the terms--for quality, diversity and choice. Those words formed the title of the 1989 White Paper which preceded the subsequent Broadcasting Act. Quality, diversity and choice are not the same as proliferation.

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The noble Lord, Lord Bragg, was interesting and persuasive in what he had to say about the BBC. However, I shall have to read Hansard before I decide just how close a friend he is of the corporation. We on these Benches see ourselves as friends of the BBC. But I hope we are candid friends. We see the licence fee as the iron pole around which public service broadcasting must be built. We shall have to be persuaded a very great deal about alternatives before we see the argument for letting go the licence fee even after 2006. The problem is that the licence fee creates a Catch-22 situation for the BBC. It needs audience to justify the licence fee, but if it chases audience too hard in the direction of populism it may then start losing the justification for its privileged position.

I agree with the noble Lord, Lord Bragg, in one respect; namely, that the future for the BBC is not in chasing its commercial rivals but in making a virtue of the special position that we as a society grant to it. It should also stand firm and look for allies to defend its position against those who not only take the rather lofty view of the noble Lord, Lord Bragg, but who may also look at the 40 per cent. of the audience that the BBC commands as rather juicy territory to occupy as commercial entrepreneurs.

Last night, Will Wyatt said to the all-party media group that,

    "behind the gossip, the noise around celebrities, the occasional alarums and excursions, ... the BBC is not so quietly fulfilling the public service promises of information, entertainment and education which have been its Holy Trinity since John Reith took over the British Broadcasting Company as it first was".
Those are extremely fine words. If the BBC keeps to that commitment to educate and inform as well as entertain, it will find many supporters, allies and defenders. However, as a number of my noble friends will say, the problem is that alongside those fine words are suspicions of dumbing-down and of the BBC moving away from Reithian commitments.

I shall not dwell too long on it but the marginalisation of politics and current affairs within the BBC's schedule is, I believe, a disgrace. It is no use the BBC referring to the Parliamentary Channel as some kind of convenient dustbin for that commitment. If the BBC is to play its role within a democracy, it must educate and inform within its main channels and at peak times. I seek some evidence that the BBC is looking in that direction.

I have one short comment to make on technology. There is much debate about the switch to digital television. There are now six different delivery systems for digital television on the market. That is because the providers will not reach agreement about interoperability. Here is one good example of where Ministers can bang heads together to the advantage of the consumer. Most Ministers are in office for only a short time. To have been the Minister responsible for the BBC becoming a public corporation, the Minister who introduced ITV or, indeed, the noble Viscount, Lord Whitelaw, who introduced Channel 4--all Ministers who left a mark on broadcasting policy--must be a source of greater satisfaction than to be thought of as someone who sat there passively while entrepreneurs and bean counters destroyed an impressive national

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heritage; namely, our public service broadcasting system. I point out to the Minister that the decisions that he and his colleagues make during the next three years will determine whether we retain that public service in our broadcasting or lose it forever.

3.48 p.m.

The Lord Bishop of Bristol: My Lords, I should like to thank the noble Lord, Lord Bragg, for introducing this issue to your Lordships' House. I want to associate myself with the very positive affirmation that he made of the BBC, but I also want to pick up the challenge which he laid down. The challenge for the BBC is to sustain its reputation and its special place in the life of the nation by producing programmes of quality and skill; that is to say, programmes which attract and extend audiences by helping to stimulate and expand the horizons and interests of viewers and listeners.

The noble Lord, Lord McNally, has already spoken of a trinity of aims: to entertain--that clearly is to be seen as an important part of any scheduling at the present time--to inform and to educate. Neither the reputation of the BBC nor its future will be secured by heading relentlessly downmarket as the route to maximum market share. We need to remember that there is an independence given to the BBC by the paying of the fee, which is a significant amount of money. That freedom ought to be used positively, not just to entertain but also to inform and to educate.

It will not surprise your Lordships' House to hear that I wish to concentrate on religious broadcasting. I need to declare an interest as I come from a city which depends greatly upon film, television, radio and the media, having both BBC Bristol on its north side and HTV on its south side. There is no doubt that the BBC remains capable of producing religious broadcasting of the highest standards and that, on occasions, it continues to do so. What is less clear is a commitment to offering such work on a regular basis, or to giving the material the promise it deserves. If your Lordships think that perhaps religion is a minority interest, a kind of sidelined activity for those who like it, I remind your Lordships' House that every Sunday in this land over 6 million people attend places of worship. We are not talking about the wider membership but the weekly attendance. The membership of the main political parties is 850,000.

There seems to be a growing tendency to reduce the quantity of religious programming, to dilute the content, and to push it to the margins of the schedules. Last Christmas was a case in point. We were offered "Noel's Christmas Festival", but not a single act of televised worship on Christmas Day--an omission which produced considerable comment and protest, not only in the postbags of bishops and archbishops, but also in the media. What is worse, we were offered "Christmas Disney" and "Christmas Bloomers" but not one moment of reflection on the true meaning of the word "Christmas".

That is just one example and there are many others. On Radio 4, the "Sunday Programme" is shorter and earlier, and "The Moral Maze" has been moved to the

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evening. On television, series like "Heart of the Matter" and "Everyman" now have reduced runs. On the World Service, "Pause for Thought" has disappeared altogether. If noble Lords think that I am trying to concentrate on some general ideas, I mention last Sunday's programming. The BBC offered us at 9.30 a.m. "The Heaven and Earth Show" but nothing again until "Heart of the Matter" at 11.30 in the evening, whereas HTV offered us "Sunday Morning" worship and "My Favourite Hymns", which comprised an interview with a member of your Lordships' House, the noble Marquess, Lord Bath. It also offered "The Jesus File" in the evening. HTV offered more religious broadcasting than the BBC.

Measured against religious programming in earlier years, there has been a decline. Measured against the substantial increase in BBC output, the decline has been considerable. Marginalisation can produce a vicious circle in which audiences may fall as a result of unfavourable scheduling, the commitment and available skill base of programme makers and broadcasters is eroded, and so the marginalisation accelerates. If this gives us cause for concern, it is not encouraging to note that the strategy document entitled The BBC Beyond 2000 makes no mention of religion whatsoever.

Faced with the challenge of meeting its clear public service duty to provide both acts of worship and serious coverage of religious and spiritual issues, the BBC seems to be facing a crisis of confidence. I believe there is no need for that to be the case. Polls show that 70 per cent. of the population of this land believe in God. They may not actively pursue that Sunday by Sunday, but it is part of what it is to be a human being, and they recognise it as such. Research indicates that religious programming appeals to many non-believers, but it also provides a service to the handicapped, the elderly, and those who are shut in. If we remember how many of our population are now over the age of 60, and who have been members of churches for the whole of their lives, religious broadcasting takes on a quite different aspect. As I said, more people go to church than we imagine. On a Sunday many more people go to church than watch football on a Saturday. It is a 6:1 ratio. "Songs of Praise" can rival the audience figures of "Match of the Day", but that is just an aside. Religion continues to be very much part of the life of the nation; a public service broadcaster should not be deluded into seeing it as an optional extra.

It has given me no pleasure to make this speech because I have been a great admirer of the BBC. With the approach of the millennium the BBC has, I believe, an opportunity to address these concerns in a positive and resounding manner. It can take the risk, the audience is there. It has an opportunity to demonstrate through the quantity, quality and prominence of the religious programming it offers listeners and viewers that it continues to deserve the reputation it has established during the past seven decades.

I have one final point to make. Religious broadcasting helps a community to understand itself. Living in a multicultural community, that has even more importance than it had during the past seven decades.

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3.56 p.m.

Viscount Tenby: My Lords, I join other noble Lords in thanking the noble Lord, Lord Bragg, for introducing this debate today and setting it on its way with a compelling and thought provoking speech, with which I agreed in almost every respect. Looking at the list of speakers today, I have come to the conclusion that I am possibly the only participant who has not been either a past, present or--dare I say it?--future governor of the BBC, or programme or film maker of distinction. Best Boy or Gofer is probably the best I can hope for now and, frankly, time is against me for obtaining either of those exacting and important roles. I have, however, one distinction of which I am not particularly proud. I probably look at more television and listen to more radio than most politicians who tend only to look at reruns of programmes in which they have been prominently featured.

We are now entering a formative period in broadcasting as significant as any since the early Reithian days. The digital revolution has profound implications in transmission, control, creativity and standards. It is particularly unfortunate that the terminal stage of analogue broadcasting, which should be unambiguously setting the targets to be met by the new technology, should in my view be marked instead by a steady decline in the nurturing of creative talent, coupled with an eagerness to go for the easier and cheaper options, hence the current dearth of new comedy writing of merit and new plays of distinction, and a reliance in their place on undemanding quiz shows, fly-on-the-wall documentaries of the "Britain's worst" type and a seemingly endless obsession with sick animals and humans.

There is also an increasing preoccupation with sex and violence, to which the Broadcasting Standards Commission has referred in recent days, revealing an increase of 70 per cent. in the number of complaints received in the past four months. This is worrying in the extreme. The increase in the "shockability factor" is defended because it is claimed it attracts the young, and the young hold the purse strings nowadays so far as advertisers are concerned. I should have thought this displays a patronising and distorted view of the younger generation, apart from being economically flawed. The middle aged and older generations have plenty of spending power and they on the whole tend to be the viewing audience on any particular night.

Some may feel it is unfortunate that the BBC too often joins in this dangerous ratings game. I am aware that within the corporation it is driven by fear, in what is surely a hangover from the Thatcher years, that a fall--any fall--in ratings may sooner rather than later put the licence at risk. That is one reason, and I hope that it is a misguided one now. The other, I fear, is the hubris of individual producers and directors. What better way to gain one's spurs than to go even further than the previous man in breaking down social taboos? This increasingly speedy drop in standards cries out for effective regulation, not censorship, and certainly not a straitjacket on true creative activity, but effective

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regulation, and, when things go badly wrong, retribution too. There is no point in having regulation without having retribution.

For years, along with others, I have argued strongly for one powerful, overarching regulatory authority, embracing both public sector broadcasting as well as the commercial world. Despite the welcome tidying up in recent months, I would be grateful if the noble Lord the Minister would give an assurance that this is still being actively considered. In the interests of eventual agreement and--dare I say it--harmony, I would gladly waive my earlier suggestion that such an authority should be called "OFFAIR". With all the problems that digital broadcasting will bring in its train, it may well be that an additional body to regulate gateway access should be established as well.

What of the corporation, halfway through its charter renewal period? In past years--years, many would say, when its creative talents truly flourished and programme makers were treated as gods--the organisation was inefficient in its control of departmental budgets and general costs. The present director-general deserves great credit for turning this situation round so that the BBC has been able to live in a world of increased cost and still have enough to invest in new projects, even if I am not as enamoured as some about 24 Hour News, which seems to me to provide the temptation to create news rather than report it. The BBC Worldwide has also been an important success and holds the key to much of the corporation's future. It may be that the corporation's commercial activities will have to be carefully ring-fenced as they grow in importance in the years to come.

However, all this has not been without cost. Bureaucracy has become endemic and morale in recent years would seem to have declined sharply. Anecdotally, personnel skills were never much in evidence at Broadcasting House, but nowadays seem to have got worse. One is almost tempted to say that they are to man management what Genghis Khan was to the peace movement.

I am sure that we all welcome wholeheartedly the recent appointment of the BBC funding review panel and will eagerly await its findings in July, particularly with regard to alternative and additional sources of revenue in what are bound to be income-stretching times. The preservation and enhancement of the public broadcasting ethic in this country is essential for anyone who cares about literacy, intelligence and the stretching of personal horizons. Whether the BBC should have to carry this burden alone after 2006 is a matter for the panel. It seems that a digital surcharge would not command universal support, and it is doubtful whether, despite Herculean effort, the corporation's commercial endeavours could make up any shortfall. A licence on all sets in a household might be difficult to enforce and would have the political appeal of a temperance campaign on New Year's Eve in Scotland.

It may be that breaking new ground would provide an answer and that commercial TV companies could make a contribution by way of an annual levy. After all, we are all shortly entering a new world and all the old

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borders are there to be crossed. Whatever the solution, public broadcasting must be made safe. It is far too precious an asset in our democracy to be left to wither. I, for one, do not begrudge one penny of the licence fee to help to preserve it, but I do begrudge giving that money if it is used to drive down standards in order to compete with the demands of advertisers on commercial channels. The battle over the BBC was fought and, thankfully, won in the 1980s. Let us use the new century to strengthen it and with it the concept of public service broadcasting in this country.

4.3 p.m.

Lord Barnett: My Lords, I join in the congratulations to my noble friend Lord Bragg. I always knew that he would make an excellent Member of your Lordships' House and he has proved it again today. He certainly was not afraid to bite the hand that feeds him, even if only a little bit.

Like others, I have to declare a past interest as a former vice-chairman of the BBC. To some extent my noble friend Lord Hussey and I were responsible for ensuring the appointment of John Birt as DG. Speaking for myself, I have no regrets about that decision, either then or now. It was the right decision.

In my brief remarks I want to concentrate on the BBC, although I recognise, as has been said, that there are good public service programmes elsewhere. I share the concern of others about the "dumbing down", as it is called, of some of the programmes. I concede that like most politicians--certainly those in another place--I see and hear very little of those programmes. That does not prevent politicians saying that they are awful; they do that all the time, both here and in another place. I see and hear little other than news and sports programmes--and of course my noble friend Lord Bragg from time to time. I enjoy them and him.

The crucial question in this debate, as has been mentioned by many, is the balance between public service broadcasting, however defined, and the need if we want it--and I do--for audience share. That does not mean that the BBC has to compete with everything that goes out on Sky, on ITV and perhaps--I am less sure--on digital. That is for the future and, unlike what has been said by some in the debate so far, I do not see how the BBC can opt out of the future, which is very much to do with digital.

How the BBC should be financed is clearly an important matter. As has been said, there is now a committee again looking into it. It has been looked at quite frequently in the past and I am not sure what the committee will come up with this time.

I agree with Sir Christopher Bland, the present chairman, that there is a need for a strong BBC, with a significant audience share, to set a benchmark for quality. The growth of television and radio stations will make it very difficult, but it will be all the more vital that the BBC competes in many, not all, of the areas of programmes put out by other channels. It will be equally important, if not vital, to balance quality with the seeking of popularity and audience share.

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I have a serious concern that without a substantial licence fee the real danger to the BBC would be its decline to a type of station such as PBS in America and many other countries around the world. That could also happen if we took the advice being offered today and cut out large numbers of our so-called popular programmes. The BBC must compete, and compete with programmes that many of us might find not so popular.

I understand that the BBC feels a constant need to tell us how good it is. It might be as well if, from time to time--and perhaps more often--it responded to criticism by saying that that criticism is perfectly valid and it will do something about it. On the other hand, constant criticism can be bad for morale. The chairman, the DG and the governors of the BBC are right to defend criticism, good or bad, as appropriate.

The real danger--and it is a danger in the nation as a whole--is that we are becoming a nation of critics. In many areas of business and of the country success has become a kind of dirty word. The BBC is a public institution, and one that is criticised probably more than most: not more than governments, but more than most. The more successful the BBC is with the majority of its programmes, the more its critics and its enemies--and there are many--will seek to show that a lot of its programmes, or at least a minority of them, are very, very bad and that something should be done about it. The BBC has had to live with that for a long time and it will continue to do so.

I shall conclude by reverting to the main question: the quality of public service broadcasting. Criticism is fine, and often just, but what does the BBC do about it? One cannot get quality on the cheap. The chairman recently said that the total commercial television revenue in 1992 was double that of the BBC; in 1999 it is four times the revenue of the BBC; and in 2006, at the time of the renewal of the charter, it will be eight times that of the BBC. The BBC cannot compete financially. That is why it has lost, sadly, all the sports programmes. That is why tonight I shall have to watch Manchester United on ITV. I very much regret that. I would have liked to have seen it on BBC. But despite the, at times, well-deserved criticism I hope that it will not deflect Parliament from maintaining a decent licence fee. I look forward to hearing what the committee considering the matter has to say.

I recognise that other broadcasters--ITV, Sky News, Sky Sports, which has so much more money, and digital TV--can and do provide news and popular programmes as good as, and at times better than, the BBC. But the BBC is unique in the world for, despite all its faults, it sets vital standards. That is the justification for the licence fee. We in Parliament must ensure that the finance is made available so that the BBC can continue with quality programmes in all areas and can improve the quality of those programmes while retaining a decent audience share.

4.10 p.m.

Baroness James of Holland Park: My Lords, I too am grateful to the noble Lord, Lord Bragg, for initiating this debate. The number of noble Lords who have put

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down their names to speak is an indication of its importance. We have listened to some distinguished, knowledgeable and compelling speeches.

But, first, I must declare a past and present interest. From 1986 to 1993 I was privileged to serve as a governor of the BBC under the chairmanship of the noble Lord, Lord Hussey, and the vice-chairmanship of the noble Lord, Lord Barnett. The BBC owes them both a debt of gratitude, as, indeed, do I. I also from time to time take part in BBC programmes on literature and the arts, one of which I recorded this morning.

I was three years old when the BBC began and I can say with truth that I have listened to its programmes every day of my life. It has provided me with trustworthy news, information, education, stimulus, entertainment and laughter, in the darkest days of the war and in the turbulent years of peace. I feel for the BBC that mixture of loyalty, affection and occasional indulgent irritation that we feel for institutions which we most revere. I am grateful to the BBC for what it has given me over the years and what it still gives me. But I have serious concerns. In the short time available, I shall concentrate on three of them.

My first concern is about programmes. The BBC has always been in something of a dilemma about its market share, and perhaps understandably so. The fear has been that if the share falls below a certain percentage-- 30 per cent. is often quoted--the public will ask why they should pay for a service they rarely use and the licence fee will be in danger. So there is the insidious temptation to concentrate on numbers rather than on quality. That way lies disaster.

Some BBC programmes are superb. Too often they are peaks of excellence in an arid plateau of undistinguished pabulum. Unless the BBC stays faithful to its mission of providing wider choice and of setting standards, it will become just one more broadcaster and will lose both public respect and the right to public funding.

I am glad that consideration is once again being given to funding. The licence fee has always been stoutly defended on the grounds that it ensures the independence of the BBC from government control. It has the virtue of certainty. Once the licence fee is set, the BBC can know with some accuracy what its income will be. But I am increasingly worried about its unfairness. Is it really just that people of vastly different incomes should pay the same? Would it not be possible, and indeed administratively simple, to have income bands based on the property values established for the council tax? The rich would pay more--perhaps considerably more--and the poor considerably less. Is it true that only a licence fee can guarantee the independence of the BBC? It is, after all, the Government who set the level of the fee.

I see from the BBC accounts for 1997-98 that the cost of licence fee collection and enforcement is £109.5 million. Presumably this covers detection vans and court proceedings, but it seems extraordinarily high. I hope that we will be able to find a system which will be simpler and fairer while still safeguarding the essential independence of the BBC.

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Perhaps my greatest concern at the moment is the managerial ethos of the BBC. I see it as increasingly too rigidly controlled, too bureaucratic, too secretive and too arrogant. The product of the BBC is not a commodity; it is creativity in sound and vision. Creativity does not flourish in an atmosphere of despotism, coercion or fear. It is not nourished by the shibboleths of fashionable managerial theories, by the filling in of innumerable forms or by directives issued in that curious bureaucratic jargon which bears little relation to the English language. And at the heart of creativity we have not a system, but people, men and women, on whose dedication, loyalty and talents the corporation depends. Systems exist to serve them. They do not exist to serve the systems. I wish that the BBC today was a happier place in which creative people could work and flourish.

I have two further points to make on management. The BBC is not managed by the director-general and his colleagues without outside assistance. It would be interesting to know how many millions of licence payers' money has been spent in the past five years on the professional and highly expensive consultants and advisers who have apparently become essential to the running of our national institutions. I suspect that the figure is somewhere in the annual accounts but I have never been able to find it.

Then there is what I would describe as the mystery of the disappearing executives. People of talent who are appointed, often with eclat and in a blaze of publicity, are suddenly no longer there: Liz Forgan from radio; Bob Phillis, deputy director-general; Sam Younger from the World Service; and Rodney Baker-Bates, financial director. They disappear into a total and interesting silence, a silence which is hardly compatible with an organisation dedicated to openness and funded from a compulsory levy on virtually every home in the country. The BBC is not a private company and it is never appropriate for it to behave like one.

We are constantly reminded that we live in a rapidly changing world and that we must adapt to and indeed welcome its vagaries. Technology advances almost by the week; institutions are reformed, often with more haste than wisdom; nothing, however revered or long-established, is sacrosanct; global communications, particularly the Internet, mean that the world seems to shrink before our eyes. It is possible to feel that the ground is no longer firm under our feet. The BBC is not the BBC of my childhood; nor can it be; nor should it be. But in the midst of this maelstrom of change, much inevitable and some necessary, surely, my Lords, principles should remain firm.

The BBC should stand for three things: integrity, independence, excellence. If it fails even in one of these it will lose the confidence of the country and will no longer retain or indeed deserve its long-standing reputation as the world's most trusted and most admired public service broadcaster. I hope--indeed, in my more optimistic moments, I am confident--that it will not fail.

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4.18 p.m.

Lord Peston: My Lords, in talking about public service in the context of broadcasting we have in mind several things. We have in mind the raising of the quality of all programmes. Programmes that are not to one's taste can still be good of their kind. We have in mind programmes aimed at breaking new ground and setting new standards. Obviously we have in mind providing what the majority of people want, but equally we have in mind programmes catering for minority interests and preferences. Above all, we have in mind programmes which are educational in the broad sense and which enhance the quality of life.

On television and radio today there are programmes as good as any that have been put out since broadcasting began. But at the bottom end--and it is a long tail--the material is worse than it has ever been, and it continues to deteriorate. If noble Lords will allow me the paradox, my objection is not to the vast quantity of dross that is transmitted every day but to the fact that the dross is second-rate. I have sacrificed myself in your Lordships' interest over the past couple of weeks and have watched some of those programmes. I could not believe how bad they were. Television at the bottom end is less literate and more damaging to the education of young people than are the worst of the tabloids. There are those who spend their lives attacking our teachers. I am not one of them. When I think what teachers are up against, with pupils spending more time in front of the television set, dominated by illiteracy and illogicality, than they do in the classroom, I find the achievements of our teachers astonishing.

One also thinks ruefully about the contradictions in the broadcast media. On the one hand, a beautifully produced classic serial raises appreciation of a great novel, and causes some people to buy it, and even to read it. It may even cause them to try some other work by the same author. On the other hand, much of television implies that most of our literary heritage is passe and that serious reading is not for the young and up to date.

The problem is a more general one, for which the broadcasters are not solely, or mainly, to blame. I refer to a demand for instant gratification. We can all agree that in order to be appreciated the best of the arts require a great deal of work. Most of the music that I love was well beyond me the first time I heard it. But broadcasters today, who seek mass audiences, find that quite unpalatable.

As an example, the other day I noted that a rare serious drama on ITV was watched by what the broadcasters called a "disappointing" 4 million people--implying presumably that they will not do such a production again. In the heyday of the legitimate London theatre a great play would be regarded as a triumph if it ran for a year and was seen by a quarter of a million people, let alone 4 million.

The position in relation to science is worse still. I hope that we can debate the subject at length on another day. The failure of the broadcasting media to take science seriously is a disaster for our country. The headline approach in terms of discoveries, Frankenstein

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monsters, eccentric scientists and continuous confusion between science and engineering does endless harm, as does the implication that a civilised person can boast that he or she knows no physics and does not understand mathematics.

My noble friend Lord Bragg was too modest to mention a superb series for which he was responsible and which has also led to an excellent publication. I should like to persuade him to try another such series based on mathematics. But the point is that even in this case we are talking about exceptions, when serious science ought to be a normal part of broadcasting output.

I have taken a broad view of public service broadcasting. It can be agreed that there are public service elements on all channels, including satellite channels. However, one does not need to be a major researcher to contrast the BBC with the commercial channels. Whatever the faults of the BBC--there are many; they have already been mentioned and will receive further mention in today's debate--it faces up to its responsibilities, which the commercial channels neglect and would neglect more were they not subject to external pressures. I shall not dwell on that topic at great length. However, I believe that in the next phase of thinking about broadcasting something must be done to raise the quality of the commercial sector.

I agreed with an enormous amount of what the noble Baroness, Lady James, said. To Echo her remarks, there are clearly tensions at the BBC between the audience maximisers and the standard setters, between the accountants and the creative artists. But the forces of good prevail occasionally. They prevail even more when people outside the BBC, such as your Lordships, remind the BBC of its Charter and traditions.

That is not to say that I am opposed to efficiency and do not take the problem seriously. On the contrary, I have always argued that those of us who believe in public service and the public sector, whether it be health, education or broadcasting, must be more committed to the efficient use of resources than anyone. Efficiency, cost control and the like are a means to a end; namely, the raising of the quality of service that is provided.

I turn now to the World Service. That, too, is one of the great contributions that the BBC has made to informing and educating people overseas, not least in learning our language--and learning it from us rather than, say, the Americans. But the World Service seems to be constantly under threat, especially from those whose dominant criterion is audience maximisation. They refer to the rest of the world as "free riders". But that is the whole point. We want those people to listen to these programmes and to see our country represented by the BBC as a source of objective news, fair comment and high quality entertainment.

Finally, I make the same point about the BBC's website. It is of outstanding quality. It would be a tragedy if those who regard it merely in accounting terms ask what we earn from it, find that the answer is nought, and then want to end it. It is a marvellous website. It is seen all over the world and is an enormous credit to the BBC.

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4.26 p.m.

Lord Monro of Langholm: My Lords, I am glad to follow the noble Lord, Lord Peston. I shall follow up his remarks about the World Service. First, I wish to thank the noble Lord, Lord Bragg, for initiating the debate. Some of the programmes that he has produced for Border Television are among the finest that I have seen in my lifetime. I hope that he will produce more in the future.

The World Service presently has an excellent exhibition in the other place. It gives Members of both Houses a chance to see its achievements. The presentation and the many brochures that are available indicate that the World Service is doing extremely well.

I travel frequently to the eastern seaboard of United States and try desperately hard, on a high-powered short wave radio, to hear World Service programmes on the eight bands and umpteen frequencies. But one always ends up with poor reception and it is very difficult to hear what is being said; and the programmes are usually broadcast at the most inconvenient times, at 2 a.m. or 3 a.m. local time. I know that short wave transmission is attuned to the atmosphere. However, I wish we could do better in relaying the World Service in the United States and other countries where transmission is poor, so that we could actually hear the service's output from London, which I know to be excellent. I wish, also, that the service would add a further five minutes in the hour of United Kingdom news, so that people abroad can hear what is going on in this country.

There is now a growing alternative in the United States of local radio stations broadcasting an hour or so of programmes on FM. That is particularly the case in Washington, and the programme originates in London. But again, more time is spent on other continental countries than on the United Kingdom. Scheduling is in the early hours of the morning when it is singularly inconvenient to listen--although it is a change from hearing four chat shows a month on Clinton for the past six months.

I wish to turn more critically to the attitude of the BBC to Scotland. I am glad that the noble Baroness, Lady Young of Old Scone, is present. She has a direct involvement with the BBC. Scotland is presently aflame with criticism on two major fronts: first, in relation to what has now become known as the "Scottish Six". The news goes out on United Kingdom television from 6 to 6.30, and it takes an earthquake or the transfer of a Rangers player to get a story on that bulletin at all. From 6.30 to 7 there is the regional news. BBC Scotland is desperately keen to run the whole of the news programme from 6 to 7 o'clock and put in appropriate comment on events in England, Wales and Northern Ireland. It feels that it ought to be able to decide what the Scottish people would like to hear. It is incredible that the BBC governors have declined to allow this to occur. I quote from an editorial last week in The Scotsman, which is one of our great national dailies:

    "The BBC appears to have decided that it must take every possible opportunity to irritate and offend Scottish viewers and listeners. Not content with its patronising dismissal of the case for a Scottish Six o'Clock News, the corporation has now concluded that there is no reason to provide live coverage of proceedings in the Scottish parliament".

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That is indeed extremely disappointing for Scotland when we are being treated as we are by the BBC based here in London.

The Scottish Parliament issue is particularly provocative. After all, I can see cable television with continuous broadcasting of the House of Commons, and now and again they put on the much better debates from the House of Lords. It takes time to build up confidence and enthusiasm to listen to and watch these programmes, but if we are to make a go of the Scottish Parliament (and now that it is in being I hope we will) it is right that the people of Scotland should be allowed to see and hear what is going on day by day in the Scottish Parliament itself. When the noble Lord, Lord McIntosh, winds up the debate I hope that he will be able to give us some good news about what the BBC intends to do in Scotland this year because the Scottish Parliament will be up and running in July and we want to be able to see and hear what is going on. This is over and above what I said earlier about requesting the governors of the BBC to think again about the Scottish Six. After all, the Broadcasting Council of Scotland, which set out to advise the BBC as far as we know, was strongly in favour of having the Scottish News at Six. The noble Baroness, Lady James, mentioned that the BBC is being totally arrogant about this and is obsessed with ratings rather than thinking of its duty as a public service.

I conclude on two quick points. Like all of us here who are interested in the countryside--I am sure the noble Lord, Lord Bragg, will support me here--I ask: why on earth do the BBC want to scrap "One Man and his Dog"? It shows a beautiful part of the north of England, mostly the Lake District, with something exciting and unpredictable happening every week; but it is being scrapped because someone at the BBC thinks we are bored with it. That is not so. Again, the BBC seems to be convinced that ratings are more important than appreciation.

Finally, I hope that the Broadcasting Standards Commission will take things a little more seriously. We do not all want to be Mary Whitehouse, who has done wonderful things in the past, but some of the language that is creeping into television now after 9 o'clock is, in my view, quite unacceptable. This is very noticeable in America on films and on television but, for heaven's sake, do not let it develop here. Surely one can make a good play with a good story without bringing in four-letter words on every other page of the script. It is high time that the Broadcasting Standards Commission took this seriously and put a stop to it because it will spoil television in the long run.

I am not quite so critical of the BBC in the general programmes. I know it seems to be on a deteriorating slope with some of its productions, particularly sport. It is desperately sad how sport is slipping out of the BBC programmes and being taken over by Sky. By and large there is much that could be continued if the spirit were there and if the BBC would only listen to the people and find out what they wanted to have.

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4.34 p.m.

Lord Hussey of North Bradley: My Lords, I, too, thank the noble Lord, Lord Bragg, for introducing this debate on an important topic. In doing so I also declare a past interest, having been Chairman of the BBC for 10 years.

The future of public service broadcasting lies first in the hands of Parliament but also in the conduct of the BBC by its governors and managers. In my first week I was challenged to define my objective. I replied that it was to leave the BBC complete with its channels and its licence fee intact. At the time that was thought to be a very unlikely prospect. The general view was that we would lose several channels. In the event we retained them all and the licence fee and at the same time strengthened the power of the governors, though you might not have noticed it.

There is a built-in frisson between governors and management. The management want the plaudits of their fellow broadcasters, judged by the industry's benchmarks. The Governors are concerned with independence, quality, high standards and the traditional ethos of a public service organisation. There was a political threat. I hope there is not one now.

The BBC is the biggest influence in the media. Rows with politicians are inevitable. So what? I do not blame politicians for trying to influence the BBC. I only blame people like myself if they give way to it. Incidentally, I discussed the BBC with politicians only in their offices. There should be clear space between the two. Too much propinquity leads to too many compromises. It weakens the resolve of editors down the line if they think their bosses are lunching with their critics.

The BBC is still a marvellous organisation. It still puts out great programmes on radio and television, but I do not think that it has got its strategy right. We face the prospect of 200 or perhaps 500 competitive channels and the onset of digital. I firmly believe that the BBC's response should be not to expand its empire at the licence payers' expense but to concentrate on its mainstream channels and invest in them.

When I joined the BBC the noble Lord, Lord Annan, told me that the BBC's problem was not that they wanted to do what everyone else did but that they wanted to do more of what everyone else did, and the situation does not seem much to have changed.

Michael Checkland and John Birt, under pressure from the governors, made great administrative reforms, saved large sums of money and radically improved efficiency, for which they both deserve great credit. But there is still a lot of money about. The licence fee brings in £2 billion a year. When I left the BBC (and I have just checked this) there was £250 million in cash from savings unspent, £200 million was given as an uplift to the licence fee for the introduction of digital television and a further £240 million from the sale of transmission. That totals £690 million pounds, which is a lot of money. What has happened to it?

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If there is a shortage of money it is not difficult to see what should be done. There is too much bureaucracy, over-bloated policy units, and too much spent on expansion and management. Ray Snoddy of The Times had it all. In his words:

    "The BBC is drowning in policy options and perpetual revolution. Less money should be spent on all those areas not directly connected with programme making, and there are many of them."
The money should go on what the licence payer can see or hear, on those mainstream channels which won for the BBC its acknowledged reputation as the finest broadcaster in the world.

It is alleged that "News 24" costs £30 million. That is an enormous amount of money, yet no one could find £4 million for the Test Matches, now lost, together with the cup final, the grand prix and England at Twickenham. The BBC is a national broadcaster, where people expect to see and hear the big events. That should be the priority. It would be a great mistake to ask for a licence fee higher than the cost of living and might incur considerable resentment. So far as I can see the people have accepted the current system without complaint.

Equally, I do not believe in the amalgamation of radio and television. They are not the same; they are different art forms. I fear for the future of radio against the monster television. Much of it is of very high standard supported by a dedicated and articulate audience. Anyone seriously interested in the news would listen to Radio 4, "The World at One" and "The World Tonight". BBC television news is excellent but it has neither the time nor the space to give the coverage that radio does.

The BBC was founded by an engineer; an unusual engineer with moral and social vision. It has always been at the front of technology and must go digital both on radio and on television. It gives much better reception. But digital broadcasting is not the message; it is only the messenger.

The moral, economic and intellectual argument for a national broadcasting service funded by a poll tax lies in its absolute independence, the quality of its programmes, the breadth of its output and the manner in which it extends the choice of programmes for its audience. If it does not do that, it is a "con".

Currently the BBC is wading into a ratings battle with the toughest, roughest, richest companies in the broadcasting world. That is not a battle it will win. It does not have the money or the ruthless competitive streak that the opposition has.

The BBC is dedicated to setting high standards for the industry and widening the people's choice and is staffed by dedicated men and women who share that motivation but many of whom are now sorely depressed. The future of the BBC lies in the minds and skills of those programme-makers whose budgets are now being dangerously squeezed. When I arrived at the BBC I thought it had too much influence; I now think it has too little. I believe that it is time for a change of emphasis and appeal to uplift the hearts and enliven the minds.

3 Mar 1999 : Column 1687

If I may add a personal note, I told the Prime Minister two years before I left the BBC that I would retire as soon as the charter had been signed. I also made up my mind that I would take no decision in my last six months that might bind the hands of my successor, otherwise I would have taken a much stronger line on moving BBC Radio and Television into a huge building which still does not work.

The future of public service broadcasting in the United Kingdom will flourish as long as the BBC remembers that people and programmes are much more important than policies and processes. That is what I have said to the BBC previously. I have made my views quite clear to the BBC, and it knows them, but never before have I stated them in public.

4.41 p.m.

Lord Addington: My Lords, the only interest I have to declare in this debate is as a consumer of public service broadcasting. I have been described by a former flatmate as an habitual user of Radio 4 and I shall concentrate my comments initially on that channel.

When the rescheduling of that broadcast channel took place recently there was a great cry that it was being dumbed down. I did not feel that. Apparently the BBC got its research right because, as someone in his thirties, I was probably the target audience it was aiming for. But it has failed in one area in particular. It is not giving me enough reasons to switch off. It is not paying enough attention to certain specialist areas and is not dealing with matters that I am not interested in or am not totally in agreement with. If someone agrees with everything one says he or she is either a sycophant or has nothing worthwhile to say. One should try to encourage disagreement and to encourage people to go into areas where one does not want to follow. That applies particularly to a publicly-funded organisation which must deal with the whole of our society.

That is a rather round-the-houses way of criticising the BBC for the lack of coverage it gives to Parliament, or the way it has sidelined it. I say frankly that I hated "Yesterday in Parliament". I hated the idea that I would very occasionally hear my own voice coming out of the radio. I found it a total shock. On one occasion, in company, I managed to pour an entire pot of coffee over my own groin when that happened. It was not something I enjoyed. However, the programme has been moved to another waveband. If one has to retune a conventional radio, by the time one has found the correct waveband the programme will be over. It is as the right reverend Prelate said about religious programmes: if programmes, especially short ones, are moved to other channels, people will miss them.

If people do not like particular programmes they can switch off. We should not be frightened of using the "off" button. In a publicly-funded broadcasting medium, losing some of the audience now and again is surely a price well worth paying in order to serve a cross-section of interests.

The BBC strikes me as being overly obsessed by the idea that it has to compete all the time with commercial sections, even the commercial sections of the other

3 Mar 1999 : Column 1688

public broadcasters. It does not; it should not have to. I hope the Minister will be able to assure us that the BBC is not expected to compete at all times. It does not need to follow the programmes of other broadcasters--for instance, the American "confession" programmes which seek to shock such as "The Jerry Springer Show". How many more such programmes do we need? How many times do we have to hear that somebody's father's brother's sister is having an affair with her father's brother's sister's aunt? We do not need to know any more. I must admit that there is a certain fascination and by the third time they hit each other you say, "Either show boxing or stop". If we have to have these revelations, there should be a soft-porn slot for them. There is only so much we can take.

It is the same with low-quality soap operas, most of which seem to consist of only five plot lines, usually concerning a brother by some adulterous relationship, whose existence was formerly unknown, who turns up on someone's doorstep, is taken in as a member of the family firm and causes a row. The character then disappears and returns to the programme three years later, played by a different actor. There are certain types of programme which the BBC certainly should not aim to do.

The noble Lord, Lord Bragg, said that in certain areas of quality other providers of public service broadcasting are outperforming the BBC. That another public service broadcaster which is commercially funded is producing quality programmes is probably the most heartening comment we shall hear in this debate. I do not believe that that situation could have occurred if it had not been for the standards set by the BBC in the first place. Without those standards, how could we have said, "You must match this"?

We must encourage the BBC to be brave and to take risks occasionally. We must allow it to fail now and again without jumping down its throat. We must allow it to continue to set standards. As long as we do that, we shall have probably the best public service broadcasting in the world--certainly in the English-speaking world. If we tell the BBC to chase viewing ratings at all costs, we shall drive it into an unwinnable contest with the giants who, for instance, cover only sport.

I have not mentioned that point before because it has already been done to death. A broadcaster with a good budget who produces only sports programmes will always be able to outbid a broadcaster who tries to cover everything. The BBC should not be in that position. I should like to see encouragement given to ensure that we have in our country the world's best highlights of sporting activities, at the very least, even if we cannot have the live events. That is surely something we can guarantee from Parliament to our public service sector.

Ultimately, unless we are prepared to allow the BBC to cover minority interests, and to cover them properly, we shall be failing to polish the jewel in the broadcasting crown.

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4.48 p.m.

Lord Puttnam: My Lords, I, too, thank and congratulate my noble friend, Lord Bragg, for making this debate possible and for the way in which he opened it. I find myself in agreement with almost everything that I have heard, from all parts of the House, this afternoon and I shall find it difficult to add to it.

I should at the outset declare an interest in that for the past 17 years I have been a director of Anglia Television. More to the point, I should also declare, or at least confess to, a passionate interest in the health and vitality of public service broadcasting generally.

In an increasingly digital age, the vitality and security of public service broadcasting is likely to be seriously threatened by those who believe that it has a diminished role to play in the brave new world of the millennium. There will continue to be fairly simplistic attacks on the licence fee as a primarily regressive tax and an unwelcome imposition. Much of this debate reminds me of a remark made by the noble Lord, Lord Runcie, who characterised such a discussion as a "swimming pool debate"--one in which most of the noise tended to come from the shallow end!

In this particular case if one looks closely not a single country has come up with anything that resembles a compelling alternative form of funding. Every attempt to create a hybrid or mixed economy--for example, by introducing advertising support, as has been attempted in Spain and Germany--has seriously damaged the public service commitment. In this new world of the information society no broadcaster can hope to be involved in every single aspect of the digital economy. Each must play to its strengths: in the case of the BBC some very specific and well-honed strengths. That is why we should applaud the success of BBC Online, while recognising that the BBC's efforts in new media must be designed to build on its traditional assets, not dilute them. Surely, it is the social purpose of public broadcasting that needs to be justified, not its profitability. In an increasingly expensive and fragmented media environment a well-led and well-motivated BBC must, once and for all, re-establish the argument for the universal licence fee as one of the most equitable and truly sustainable forms of social justice of our modern era.

I suggest that instead of debating the funding mechanism we would be better advised to focus on the BBC's core role, its mission if you will. This needs to be defined as tightly as possible. To use a metaphor of which I have become increasingly fond, the BBC can usefully think of itself more as a "keep" than a "castle"; that is, possibly a smaller organisation but one with higher walls that guard a unique treasurehouse of innovative talent, critical standards and, most important of all, truth--the keeper of our national conscience as it were.

The Government's role in all of this is to endow the corporation with creative security and independence and ensure that it remains a benchmark for quality across the whole of our broadcasting system.

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What might this mean at an operational level? In the few minutes remaining to me I can do little more than sketch out a couple of examples that the BBC and perhaps the Minister might choose to consider. First, there is an overwhelming need for a strategic recognition at the centre that the BBC could, and should, be doing much more to reach out to regional, even local, audiences and to drive its roots deep into the under-nourished soul of urban and rural localities. Surely, the principal social purpose of any public service broadcaster must be constantly to inform and refresh our sense of community. BBC local radio in particular can encourage and deepen that sense of community in a way that no commercial broadcaster is ever likely consistently to manage. This is one means by which the BBC can remain intimately identified with our national life, just as over the past 75 years or so it has established itself as an essential element in the fabric of our imagination in all its diversity, creative richness and complexity--three phrases that precisely describe the corporation as they do the nation.

It is equally worth emphasising the vital role public service broadcasting plays in nurturing and developing our educational system. It is a truth, more or less universally acknowledged, that moving images, in one form or another, now represent the primary form of leisure for most people in this country. As a result, an increasingly close relationship is developing between the audio-visual communications industry, at the heart of which lies television, and our appetite for learning. It is a matter of the greatest possible public interest that the experience of our broadcasting institutions is brought to the service of education with as much energy, imagination and integrity as possible. It is my belief that we have as yet only scratched the surface of television's educational potential, but perhaps that is a debate for another time.

Likewise, we must ensure that training remains at the heart of the BBC's remit. One of the fundamental principles of a guaranteed licence fee must be an obligation to uphold production values right across the broadcast system. This must not become a negotiable obligation. There also needs to be serious consideration of the way in which the BBC is governed. In particular, there is a need to ensure that the appointment of the governors is entirely free from the pressures and temptations of the electoral cycle.

One might have hoped that the dawning of the digital age would have offered access to a new era of enlightened and informed debate. Instead, a torrent of opinion, of "spin", swirls through almost every channel of communication, threatening to obscure that bedrock of truth and fact on which the principles of any democracy ultimately rest. Surely, the role of public broadcasting is to enrich our great national debates and enable us to move forward as an informed and thoughtful nation, rather than being swamped in a tidal wave of pressures and prejudice.

It will come as little surprise to your Lordships to be reminded that trash, trivia and sensation can be brought to the marketplace at surprisingly low cost. Truth, responsibility and quality have always taken longer and, for the most part, carry a far higher price--and thereby,

3 Mar 1999 : Column 1691

necessarily, a far higher social value. It is not, and should never have been, the BBC's function to compete with the market on the market's terms. Our public broadcasting system is financed and structured in such a way as not to replicate the market but to challenge and, it is hoped, inspire it. It is absolutely vital that it remains so.

4.56 p.m.

Lord Chadlington: My Lords, I join others in congratulating the noble Lord, Lord Bragg, on initiating this important and stimulating debate and thanking him. In particular, I congratulate him on the excellence of his introductory speech. I wish to examine in some detail the relationship between the lottery and public service broadcasting. I shall address in particular the responsibility for public access that I believe falls on the shoulders of successful applicants and the public service role within that that public service broadcasting must now play.

To do this I must first declare a number of interests. I served for several years as an independent member of the Arts Council of Great Britain and latterly the Arts Council of England, when I chaired the first Arts Council Lottery Panel. I also serve, or have served, on the board of a number of arts organisations, including the Royal Opera House. Although I shall limit my comments to lottery funding of the arts, many of the opportunities that public service broadcasting presents--I emphasise this--would apply equally to other distributing bodies, such as the Sports Council and the National Heritage Memorial Fund.

It is a tribute to all at the Arts Council that the lottery has been such a success. According to the latest figures there have been nearly 8,000 awards, with over £1 billion invested in projects with a total value nearly two-and-a-half times that sum. Quite properly, the vast majority of these by number are below £100,000. However, more than 700 organisations receive grants of over £100,000, many of them over £1 million and a few £10 million or more.

There are those who may argue that it is the people of Britain who have made this huge investment possible and therefore have a right to share in this vast bonus for the cultural life of Britain. Whether or not this is true, I suspect that the Saturday and Wednesday punter is more interested in whether he wins £1 million than anything else. I suspect that good causes are not uppermost in his or her mind. But it seems to me that the way these arts organisations have been funded places upon them at least a moral imperative to bring to the attention of the largest possible number the work that they can undertake as a result of lottery funding.

Indeed, as I hope to show in a moment, it is also in their enlightened self-interest so to do. The noble Lord, Lord Puttnam, who generously accepted my invitation to join the Arts Council Lottery Panel in those early days, made much of the need for successful applicants to interpret access in the broadest sense. I remember that he argued on a number of occasions that access was not just about the disabled--important though that was--but about sharing artistic experience with as many people as possible up and down the land.

3 Mar 1999 : Column 1692

He evangelised that larger capital projects, particularly in our great national companies, must have the most up-to-date technological and broadcasting facilities and the most flexible union practices. That may seem obvious today. But even five years ago such an undertaking from applicants often proved remarkably difficult to obtain. And it is strange that that should have been the case, for two principal reasons. First, one of the key problems faced by arts organisations is audience development--expanding the market--particularly for new work. It is clear that enjoying a significant capital injection to build or extend a theatre or a concert hall clearly puts the problem of audience development into even sharper relief. These capital developments nearly always demand more people to fill more seats more often.

Secondly, the need to improve returns in larger venues funded by the lottery is also intensified by the agendas of partnership funders. On average, taken over the past five years, for every £1 a project costs, the Arts Council puts in 40p and other funders 60p. An analysis of the funding pipeline suggests that this funding split is likely to continue to be the norm. But those partners are themselves looking for a return of some sort, often through publicity or, indeed, interest payments on sums provided.

The only way to build audiences is to appeal to a wider and wider market in a broader and broader catchment area. Publicity attracts that audience, often keeps it and encourages it to try new experiences. Public service broadcasting provides just that opportunity. If the prospect of a lottery channel--of which I was much in favour--no longer proves feasible, it surely should be incumbent on the public service broadcasters to bring those lottery funded projects into the homes of those people who paid for them. The benefits which would accrue to the arts community are incalculable. Would it not be possible to seek agreement between those organisations to whom lottery funding is given and public service broadcasters that so many hours would be devoted annually to successful applicants? Could it not be a condition of both the granting or the continuing of Arts Council funding and other distribution bodies, on the one hand, and licences, on the other? Even if that were limited to the national companies which received awards, the impact on arts awareness and arts education would be immense.

Let us consider the numbers. So far the Arts Council has provided £388 million to over 400 national projects. What a shot in the arm it would be to the profile of those outstanding organisations to know that such publicity opportunities existed. Publicity attracts and makes stars. Attracting better performers in turn increases audience numbers, creating a virtuous circle. Similarly, young performers are given a much wider audience than would ever be the case without broadcasting support.

The development of archive, educational and outreach programmes will clearly add far more to the status of the national companies. And of course such an initiative need not be limited to national bodies. The Arts Council, like other distributing bodies, has an overwhelming percentage of its investments in small local organisations, all doing exciting innovative projects and

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hungry to expand and develop markets. Here is a rich vein of programming funded in large part by the people of Britain. We must find ways to exploit it to the benefit of all parties involved.

I believe that any consideration of the future of public service broadcasting and its public service role must take into account the effect that the lottery has had throughout our national life, the contribution made by the people of Britain to its success and that the distribution bodies have been excellent and worthy custodians of lottery funds. But above all else the conjunction of successful lottery applicants and enlightened public service broadcasting policy would bring into all our homes the vibrance and variety of our cultural and sporting life, both nationally and locally, to the benefit of us all.

5.6 p.m.

Lord Currie of Marylebone: My Lords, I, too, congratulate my noble friend Lord Bragg on introducing the debate. His introductory speech was every bit as entertaining and informative as his programmes. But I fear that it may not reach such a significant market share. I, too, have to declare an interest. I have been one of those who has acted on occasions as a consultant to the BBC.

I wish to emphasise a point which has been raised previously. In this country we broadcast programmes exceedingly well. If one looks around the world, Europe and the United States have much poorer systems, with less popular support and far less consumer satisfaction. It is clear that the key reason for that is the unique role of the BBC. It has acted as a benchmark for standards, a setting of quality, throughout the industry over many decades and has therefore helped to shape the broadcasting industry to the benefit of the public. It is undoubtedly the case that commercial broadcasters fulfil the public service role. But I think it was the noble Lord, Lord Addington, who asked: would that be the case if the BBC had not existed? I rather doubt it.

It is one of those areas where the public corporation, with a positive mission to fulfil the objective of augmenting social and cultural life, has worked exceedingly well. We have given it up in other areas but not this one; and we should work hard to sustain it. There are those who argue, although not in this debate, that the digital age will change all that: that the BBC may have been a force for good in the past but it will be marginalised in the digital world, with the proliferation of channels and technologies. I think that that view is incorrect. In fact, if anything, the need for public service broadcasting is augmented in the digital age. The digital revolution may have got rid of spectrum scarcity, one important source of monopoly in this business, but it brings the largely costless reproduction of content across many different formats. That means enormous economies of scale and the likelihood therefore that large players, large monopolies, will thrive in the industry as never before. For that reason, it is vital that the public service role continues and remains significant.

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The digital age also means fragmentation of consumers. It makes people's identification of community more difficult. It will make finding one's way round the proliferation of offerings much harder. We shall be looking for navigators and guides; and the BBC has a crucial role to play in that.

The mission of the BBC to educate, inform and entertain is crucial to the fostering of community at all levels--national, regional and local, as well as ethnic and other minorities. That mission requires market share. There have been criticisms that the BBC has gone too far in that direction. Perhaps that is true in certain areas. But if the BBC is marginalised in terms of its viewing, it will not be able to fulfil that key public service role to the benefit of our society.

In the commercial world there are companies which pursue market share through the pursuit of quality. That is what the BBC should be urged to do. It is well placed to do so. It is worth recalling that the BBC is one of the top brands globally. It is among the top handful of brands recognised instantly by many people around the world--to a greater extent than any company in the UK; greater than any organisation and much greater, I suspect, than even our Government. That is an inheritance that we should not lose or squander. I believe that it will be the key in the digital age because among the diversity and proliferation we shall be looking for navigators and those brands will be the key to success. We need to use the BBC brand for quality to ensure that the public service role is continued into the next decade and beyond.

That will not be easy. If one considers graphs for industry revenue, they are growing at a rapid rate, whereas the licence fee income is largely flat. Looking to the future for an organisation with that projected revenue stream, one would predict that it was going to be marginalised, taken over and sidelined fairly quickly. Therefore, the vital question is: what other resources are available to the BBC to ensure that it continues to play the vital role that it can and should play in the future.

One area which is controversial is the BBC's commercial activities. The BBC must be focused on its key objective of public service broadcasting, but it is right also that it should take advantage of its productions in the commercial world, particularly overseas, by selling its products around the world in the best possible way. It should exploit its assets internationally and derive value domestically from the secondary exploitation of its productions. That is one way to generate revenue which can be used to good effect to augment the public service objectives of broadcasting which the BBC has as its core activity.

In so doing, it must avoid unfair competition. It is subject to UK competition law, which has become tougher. It is subject also to European law. The Commission has made many interventions in the area of broadcasting under merger and competition law. Therefore, the BBC must ensure that it behaves fairly in its commercial activities in securing extra revenue from this source.

But I doubt whether that will be enough because the BBC must expand into the new developing areas. It will be marginalised if it does not go into digital television.

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It will lose important opportunities if it does not go into the Internet. The Internet offers an extremely effective way of delivering the World Service objectives through a new medium which in many countries is more effective than the old medium. I urge the Government to think about whether the grant-in-aid that the BBC receives in that respect could be more flexible in the way that it is interpreted so as to allow for such innovation.

If we are to maintain the BBC in its valuable and unique role we shall need extra resources. Some may come from the commercial aspect, but it may be that we shall have to think about the difficult areas of the licence fee, a digital supplement and so on. If we do not augment the BBC's resources, in 10 years' time we may find that we have squandered the unique asset that it represents.

5.11 p.m.

Viscount Astor: My Lords, I too must declare an interest because I am a director of British Digital Broadcasting, otherwise known as On-Digital. Digital broadcasting is a means of delivery which all broadcasters are using. That includes the BBC, ITV and Channel 4.

As regards the BBC, perhaps I may begin by saying a few words about the licence fee. I believe that that remains the best method of funding for the BBC. However, the licence fee must be seen as providing value for money. And what money that is. What a wonderful job it must be to be chairman of the BBC, as the noble Lord, Lord Hussey, was. One does not have to worry about banks or shareholders. Whatever happens, whatever one does, on 1st January each year, one is guaranteed an income of nearly £2 billion per year. What other business has a guaranteed cash flow like that?

The licence fee provides the BBC with an opportunity to be innovative and distinctive. It allows the corporation a freedom from commercial pressures. That freedom allows it to experiment and to challenge. To be blunt, it allows it the opportunity to fail, which is difficult for commercial broadcasters. The stability and certainty of the licence fee takes the pressure off achieving audience share. That is a huge advantage as it allows the BBC to deliver what the commercial market does not.

I am against any change in funding as any commercial or sponsorship income would compromise that unique situation. The BBC is a public service broadcaster; it is an alternative to the commercially- funded channels; and long may it last.

I do not say that the BBC should not be popular but I am saying it should be distinctive and, extremely important, it should set industry standards. In my view the BBC has become too focused on audience share and not sufficiently focused on audience reach. It seems to have a strategy that it is vitally important for the BBC to have a one-third market share to legitimise, as it were, the licence fee. That aim is misguided and unrealistic. As satellite and cable grow, the share of all broadcasters will decline.

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The market is now huge. Gone are the days of spectrum and channel scarcity. I agree with Sir Christopher Bland when he said that the BBC could reduce the gap between those who are information-rich and those who are information-poor. For example, the BBC should cover sporting rights that are part of our national identity--events that are on the "list". But I do not believe that the BBC should use public money to compete against pay-to-view for premium sporting rights on the general assumption that they should be broadcast on the BBC. There are plenty of sports that do not get a look-in at the moment.

I am concerned, as are others in your Lordships' House, about the mix of commercial services operated by the BBC in conjunction with its public service remit. I have nothing against the BBC being commercial but the core of BBC public services should be more clearly separated from its commercial side. At present, the Royal Charter and Agreement allows for an audit to differentiate between the two. The present arrangement is opaque. Parliament, let alone the public, does not understand where one starts and the other ends.

The core services of the BBC should offer what the market does not. It should be distinctive and should not emulate the commercial sector. It should provide something for everybody for at least some of the week. Those objectives could apply equally to radio. BBC's commercial activities are undertaken by Worldwide and BBC resources. They exploit the brands, programme rights, intellectual property rights, books and magazines. The BBC believes that those activities enhance the brand and any separation would risk the integrity of the brand and the strategic purpose of BBC Worldwide.

Some have argued for privatisation of the commercial activities, saying that privatisation would raise cash for the BBC, improve efficiency, improve Britain's programme exports and, perhaps more important, remove the criticism by commercial parties of unfair trading. That case has not yet been made but it perhaps could be made in future if the Government and the BBC do not act to ensure a clear separation of the public service remit from the Worldwide commercial activities.

I said earlier that the separation is opaque. That is a major understatement. For the benefit of all, Parliament and the public should be able to see where one starts and the other ends. I do not want the BBC to be like ITV. The BBC must be distinctive. It must reach the parts that other broadcasters do not.

5.17 p.m.

Lord Ahmed: My Lords, I too thank my noble friend Lord Bragg for allowing me the opportunity to contribute to this important debate. I declare my interest in that I buy a licence for £97.50.

The debate on the future of public service broadcasting in the United Kingdom must go beyond the mainstream white Christian community and include ethnic minorities and other religious communities. I appreciate that we live in a changing world, and therefore, through new technology, we must expect to increase the number of television channels and radio stations available to us. But I cannot accept the changing of ethical and moral values.

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The term "sexy" is becoming increasingly popular and the British modern culture is rapidly dumbing down to a level based on consumerism and materialism rather than the long-term intellectual and spiritual debate. It is important that public service broadcasting should have freedom of expression and freedom from commercial and political pressures. However, it must be accountable and provide value for money with the highest ethical standards and impartiality.

I cannot resist mentioning the BBC and the excellent news service that it provides in the UK and abroad. The BBC is the world's best-known and most-respected broadcaster. Similarly, radio stations across the country generally reflect the need of local communities, provide entertainment and debate issues and concerns of local people. Perhaps I may make a little plug for BBC Radio Sheffield, which provides an excellent service for the South Yorkshire communities.

However, I am concerned with the BBC Asian programmes' department, based in Birmingham, which is dominated by a particular social group of people. I have to say that there is also the same problem in the mainstream. My concern is the apparent lack of staff from the Pakistani and Bengali communities and that programmes do not cater for the Moslem community. The religious programmes mainly concentrate on Christian worship, and the Asian programmes with Bollywood. It seems that two million British Moslems have no category or department to go to. The BBC has abdicated its responsibility to British Moslems by including a broader category of "Asians" who seem to concentrate on cheap and superficial programmes related to fashion, Balti and Bollywood.

What has happened to serious journalism? What has happened to the intellectual debate? I have written to the director-general and the secretary of the BBC on behalf of the Moslem community. I am still waiting for information I asked for 10 weeks ago.

The BBC marketing report 100 Tribes looks at the viewer make-up of Britain and identifies the Asian community with music, fashion, Bollywood, Bangla and mega mella. The report completely ignores the needs of two million Moslem licence payers. The only programmes made about Moslems are not for Moslems, and that is the problem.

The new identity of "Asians" by the BBC ignores all the traditional cultures of the subcontinent. Languages such as Punjabi, Hindi and Urdu are not always pronounced properly. Art and culture represent a completely new identity of the "Asians" and are not relevant to the majority of British ethnic minorities.

Finally, the commercial radio and independent television companies have to take note of the fact that Asians have large families with over £2 billion buying power. By ignoring us, advertising is not meeting the needs of our communities. This week the Prime Minister said,

    "The Government's role is to give sensible leadership, and I have no doubt whatever that it is towards a more tolerant Britain, a more inclusive Britain, a Britain of all the talents that the vast majority of black and white people wish to be led".

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I call upon the independent television companies and the BBC to look into their institutions, and fight prejudice; to ensure that their staff reflect their viewers and to develop, adapt and change to meet the needs of many, not just the vocal few.

5.25 p.m.

Baroness Flather: My Lords, I, too, thank the noble Lord, Lord Bragg, for allowing us the opportunity of this debate. As so many of us have put our names down, clearly we are happy to have the opportunity to speak about our favourite whipping boy.

After hearing the speech of the noble Lord, Lord Bragg, I wondered whether I should speak at all. So much of what I intended to say he had already said, including some of the figures I intended to quote. However, I decided to make my speech because I have one or two other points to make.

First, I declare an interest--a substantial one--as director of an ITV regional cable television broadcaster. I was also chairman of a local independent radio station for five years, and it is with radio that I shall start. Very little has been said about radio. What has been said has been more or less a throw-away approach, especially from the noble Lord, Lord Puttnam, who wrote off independent local radio in about one sentence.

I wonder how many noble Lords know that there are 200 radio stations, both local and regional, and three national stations? Forty per cent. of listeners listen to local commercial radio as opposed to 9 per cent. who listen to BBC local radio. Indeed, 50 per cent. of all listeners listen to local independent radio.

There seems to be some confusion about the responsibilities of local independent radio to the local community. I should like to quote what the Minister for tourism said about the commercial radio industry, which might give some idea of those responsibilities:

    "The commercial radio industry recognises the importance of establishing firm links with the community to benefit both that community and to strengthen the radio station's profile and audience ... The commitment of commercial radio to the local community is demonstrated by the extent of stations' involvement in community projects beyond traditional on-air public service announcements".
As I have said, for five years I was chairman of a radio station which served Windsor, Maidenhead and Slough. I can assure noble Lords that our most important approach was to keep the links with the community. We had focus groups and three local committees for three towns. We did our very best to keep in touch with everything. We were present at every major community fund-raising effort for charity. It is important to realise that local commercial radio is answerable to the licensing authority for what it will provide. Who monitors what the BBC provides? Local independent radio cannot afford any arrogance nor any separation from the local community.

Perhaps I may now turn to television. The noble Lord, Lord Rees-Mogg, was rather scathing about television. However, if he had looked carefully at the Radio Times, he would have found a very good oceanic drama called, "Hornblower" which extolled the virtues of honesty and decency. He might also have come across the outstanding drama produced by Granada on the murder

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of Stephen Lawrence. So, there are peaks and troughs on ITV. However, it is clear that ITV's peaks match anything produced by the BBC. It is also true that the BBC's troughs press standards below what ITV produces. The real problem is that too much of the time, when we turn on to BBC--BBC1 particularly--it is no different from ITV. That is the nub of the matter. We need the BBC to be different from ITV.

Two recent publications, Public Purposes in Broadcasting and an ITV survey, The BBC's Public Service Obligations & Commercial Activities, have been quoted by the noble Lord, Lord Bragg. They clearly demonstrate that the obligations are not necessarily being met.

No speech can be complete without mentioning "Vanessa". There is no way that we can say that "Vanessa" is a suitable programme for a public service broadcaster, particularly with all the complications that have arisen.

Perhaps I may mention, briefly, the ethnic minority programmes. I agree with what the noble Lord, Lord Ahmed said, but there are some other points I should like to make. I do not think that any permeation of minority programming into the mainstream has taken place. If we are to reflect the multi-cultural nature of Great Britain, it is important that we should be part of the mainstream. We are still in a ghetto, mainly in Birmingham, and are very poorly funded. Programme production is poor and would never be acceptable in mainstream programming.

The BBC needs an independent regulator. I was deeply distressed when it showed a party political broadcast by the British National Party in its entirety. I complained to ITV, but at least LWT had edited the programme to take out the worst offending parts and Channel 4 had not shown it at all. However, when I complained to the BBC about showing it in its entirety, I got back nothing but "flannel". At least ITV did some research. If I am going to be fobbed off, I would rather be fobbed off by an external regulator than a BBC apparatchik.

The BBC made a fundamental error in partnering BSkyB for its digital technology. There is now no competition for BSkyB; it already controls Cable and has virtually destroyed it. In around five or six years we will see BSkyB putting pressure on all the digital television providers. BBC should have partnered another consortium to provide competition for BSkyB. No other company could do that.

My time is almost up, but I hope that today's broadcast has shown that the BBC cannot treat itself as a sacred cow and feel totally protected. And I am pleased about that.

5.31 p.m.

Lord Birkett: My Lords, I too congratulate the noble Lord, Lord Bragg, not only on introducing this important debate, but also on the wisdom and common sense with which he launched it. I thought I would confine my remarks this afternoon to radio, partly because I like it so much and, though I have been a film-maker all my life, because I suspect that it

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stimulates the imagination more than do the movies and television; but also for another reason. That is, when we are talking about "public service" we can distinguish the qualities of public service more easily in radio than in television. Of course, we can channel-hop on the radio as easily as we can on the television, but if we channel-hop blindly on television we find it extremely difficult to know which channel we have reached. If we do it on the radio, however, we can be sure within a very few moments which channel we are listening to.

If I listen to BBC Radio 3 more than others, it is simply because I love music so much. I love the fact that it still has its great orchestras--I pray that they never get abolished or diminished. I like them because, not only are they fine orchestras, but they do exactly as the noble Viscount, Lord Astor, suggested--they reach the repertoire that other, more commercially-minded orchestras cannot or dare not reach.

All the same, much though I love music and much though I love Radio 3, I wonder, with the noble Lord, Lord Bragg, whether classical music needs to be continuous. Does it do classical music any service for it to be continuous? There is no need for BBC Radio 3 to fear that because Classic FM is continuous it should be also. Classic FM was greeted in its initial stages with great enthusiasm because everybody said that its listeners would go on to other music--perhaps to BBC Radio 3--that they would frequent the concert halls and become classical devotees. But sometimes I have a nasty suspicion that not all Classic FM listeners do that; that some of them just buy more and more records of favourite excerpts.

The whole business of classical music as an enormous, if quality, wallpaper in our lives is perhaps mistaken. If one listens to Classic FM or indeed Radio 3 in the mornings or afternoons, one listens to programmes called "Morning Choice", or "Morning Concert", or "Morning Masterworks", or "Morning Requests", or "Morning Miscellany", unless of course they are the afternoon equivalent. One never knows what they are because all the programmes are identical; they are all wonderful records of wonderful classical music. Like the noble Lord, Lord Bragg, I miss the other elements of radio. I can remember, not just from Radio 3 but from the good old Third Programme days, extraordinary experiences like the strange stories of Heinrich Boll, lectures by Sir Isaiah Berlin, talks by Max Beerbohm, no less, W.B. Yeats, the poetry of James Stevens and the amazing surreal contributions of Sir Ivor Cutler. We do not find them any more; we do not find the mixture that once we found.

Perhaps I should stop there because I have a strong feeling that the BBC has had enough advice on what it should do from all of your Lordships this afternoon to last it a lifetime. Instead I shall finish by asking what the nature of public service actually is. It is a phrase we have all used this afternoon. What distinguishes it from any other service? The noble Lord, Lord Inglewood, said that he did not think the Government had anything to do. I do not know whether the noble Lord, Lord McIntosh, regards that as a matter of relief or of

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disappointment. But I have a suggestion not of something the Government should do but of a principle I hope they will accept. It is this.

What distinguishes a public service is that the quality and variety of the service come first; commerce, rivalry, profit, economy, organisation, all come second. Nobody wants a public service organisation not to be properly organised; not to have budgets; not to keep to them; and to be absolutely blind in the face of competition. But so many noble Lords this afternoon emphasised that it should not go for ratings alone. They can be dazzling. I have a stepson who works as an actor in Hollywood on one of the most popular series. When I asked him casually, "How many people watch you each week?", he said, "Oh, 65 million". That is a figure so staggering that one cannot comprehend it in terms of an audience, but public service broadcasting should not be seduced by that. I believe that the BBC should do exactly what the noble Lord, Lord Bragg, said--concentrate on what it can do best and what it can do uniquely. That is the definition of public service.

5.37 p.m.

Baroness Young of Old Scone: My Lords, perhaps I can add my welcome to the opportunity my noble friend Lord Bragg has given us to debate this important subject of public service broadcasting. I should beg forgiveness for yet another declaration of interest; I am privileged to be the current BBC Vice-Chairman. The Addison Rules mean that I am not going to be able to comment at all on some of the issues raised, particularly about the BBC, and this will be one of the most frustrating seven minutes of my life. However, I hope the Minister will rise to the defence of the BBC in some areas.

Others spoke about the vibrant broadcasting environment of the United Kingdom. Broadcasting is a British success story and we are seeing existing strong networks being joined rapidly by fast-growing new services, including digital, the Internet and broadcasting on demand. Public service broadcasters must be in those new technologies and delivery mechanisms because they are the technologies and delivery mechanisms of the future; otherwise, public service broadcasting will face an absolute decline.

Some people have been predicting that, with more in the way of variety in broadcasting, it will mean a worse service with competition fragmenting audiences, investment with tabloid values growing and a nation divided between those who can benefit from the new services and those who cannot afford to. I am more buoyant about the future of public service broadcasting in this new and fast-developing world.

I am probably personally privileged in standing at this watershed in UK broadcasting to be just at the right age. I am old enough to remember the potter's wheel, but young enough not to go into the foetal position when faced with the Internet. I agree very much with my noble friend Lord Currie of Marylebone that we need high quality public service broadcasting rather more as a result of market fragmentation.

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Several matters have already been pointed out by my noble friend Lord Puttnam which we need to bear in mind as important ingredients of public service broadcasting in this new world. The first is that we need to carry forward the principles of informing, educating and entertaining when the market itself will not necessarily assure them. That does not mean that we in public service broadcasting should be relegated to carrying the boring, but worthy, kind of material that I might typify as being watched only by one man and his dog.

The second key feature of public service broadcasting was indicated by my noble friend Lord Barnett; namely, the role that it has in helping to improve standards for broadcasting. Regulation is a very poor mechanism for setting standards. A thriving public service broadcasting sector needs to be large enough to influence standards across the market as a whole. I shall speak more about that when I touch on the issue of funding.

The third role for public service broadcasting which is vital for the future is inclusiveness to ensure that through news and factual programmes all groups in society actively join in the debate on national, regional and local issues. We need to ensure that we can provide ways in which those who might otherwise be socially excluded are embraced within society, and therefore overcome the risks of division within our society into those who are information rich and those who are information poor.

Last but not least public service broadcasting needs to be glue for the nation, as it were, to provide an opportunity for shared experiences for all of us. That will become even more acute in a new, devolved United Kingdom with our very diverse society, but with a fragmented broadcasting market.

I wish to tackle in more detail two issues which have already been raised today. One is quality. I would like to debunk the term "dumbing down" once and for all. If I ever find the person who invented it I might address a few well chosen words to them. It is an incredibly glib phrase, which misrepresents entirely an important objective of public service broadcasting. We need to find a new word. Someone suggested "wising up" rather than "dumbing down". I have been trying to popularise the word "widebrowing" which describes the need for us to engage a wide range of audiences if the public purposes of public broadcasting are to be fulfilled. That requires new ways of making important issues accessible and relevant to a wide range of audiences.

If I dare, perhaps I may touch on the vexed question of programmes like "Vanessa". I could very well put money on the fact that probably not many noble Lords watch that programme. With due respect to your Lordships' House neither we, nor the chattering classes generally, can for the most part call ourselves normal or average. I suggest that if noble Lords come across programmes that do not suit them they should ponder for a moment. As the noble Lord, Lord Addington, said, it may be that a programme was meant for an age and a stage far removed from noble Lords. One should judge whether the programme is good of its kind and effective in bringing issues or content in a relevant way to more

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normal people than noble Lords or myself. One must judge the programme because public sector broadcasting does not always get it right. Public sector broadcasters must guard against popularisation for its own sake.

The programme "Vanessa" at its best is trying to bring issues in a relevant way to wide audiences for the sake of the public service broadcasting objective of informing and educating and not simply for popularity.

As has already been highlighted, some elements of quality need comparative freedom from market pressures, such as investment in the arts and taking risks. As the noble Viscount, Lord Astor, stressed, comparative freedom from market pressures gives an ability to take risks with new approaches and new talent. I doubt whether we would see commercial broadcasting in a competitive market giving an early chance to people such as Dennis Potter or Harold Pinter in the future.

I pray the indulgence of noble Lords for a moment. The licence fee is an imperfect mechanism for funding public service broadcasting. Every other mechanism is poorer. We need to defend the licence fee because it gives public service broadcasting space to carry out the very important roles that I have outlined: to develop its role in providing services that inform, educate and entertain in ways which the market alone will not. It should be done in an inclusive way for the whole of the United Kingdom's diverse society and indeed for the world.

5.45 p.m.

Lord Lucas: My Lords, I am grateful to the noble Lord, Lord Bragg, for giving us the opportunity to have this debate. I have often found his broadcasting extremely infuriating. I have never been to sleep during one of his broadcasts. I enjoyed his speech enormously and I find myself in agreement with most of it.

I shall concentrate my remarks on the BBC. It is suffering from a lack of focus and direction, typified by the material that it sent to us before this debate. The front of the document The BBC Beyond 2000 contains a mission statement which is an example to everybody of what a mission statement should not be. It is a lot of guff, motherhood and apple pie. There is almost nothing in it which can be a day-to-day guide to the people within the corporation on how they should make programmes and conduct their lives. What is needed is a much more hard-edged understanding of what public service broadcasting should be and how it should be governed.

To my mind there are two fundamental things that should form the BBC. The first is a set of values which belong to public service broadcasting and which are not founded in the commercial world but set on their own. Secondly, and just as important, the BBC should be different, as other speakers have said. If it is not different, there is no function at all in having it. It must be different in everything that it does. Imitating ITV and doing as well as some other commercial broadcaster does nothing to justify the existence of a particular programme.

As regards values, I pick out three. First, as the noble Lord, Lord Puttnam, said, there is truth. It should be in everything that the BBC does, from such obvious

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features as news broadcasting and the dramatic programmes it makes to the slightest and most ordinary part of its programming. Truth should be the fundamental principle which all of its producers and programmers bear in mind every day.

Secondly, there should be a mission to inform. That is an old BBC icon but increasingly neglected. It is important that when we see a BBC programme, with any luck we should learn something from it. It should not be just bland and intellectually without content.

Although it is much paraded by the BBC at the moment, I do not believe it has achieved as much quality as it should. It aims at quality but it should do better to achieve good quality programmes. I take as an example something which the BBC does well in all three aspects. "EastEnders" is a programme which is true to the life that it depicts in as much as any soap opera can be. I do not think that the type of people it depicts would take offence at anything representative of themselves. It is informative and tells those of us who are not part of that community a great deal about the lives and concerns of such people, as well as being extremely entertaining. It is also a programme of high quality which is well produced and well acted.

But there is a great deal of the work of the BBC that is not at that level. I am a great listener to the "Today" programme. But its news agenda has become tabloid. The stories on which it chooses to lead are generally found in the Sun and the Daily Mirror, often also in the Daily Mail and the Daily Express but have no resemblance at all to the priorities contained in the great broadsheet newspapers. The main morning Radio 4 lead programme should not be like that.

As has been said by many other speakers and frequently in this House, the broadcasting of Parliament is a total disgrace. It has become a mixture of soundbites and pundits. It contains absolutely nothing of what has been said and done in Parliament. If you are reporting Parliament and are governed by a desire for truth and to provide information, then Parliament should be reported on Parliament's terms. We make speeches which are generally about seven to 10 minutes long. That is the sort of aspect which ought to be fitted into broadcasting if you want to give a clear view of what Parliament is.

I turn now to the differences. As the noble Lord, Lord Birkett, and others have said, ratings should not count. If you are trying to be different from ITV, it must be remembered that ITV has to be governed by ratings. Indeed, that is what its revenues are generated by. However, the BBC is not so governed. It has to be different and it should look at things in a different way. I do not wish to see the BBC crowing about, or being governed by, ratings.

The BBC has to try new approaches. It is one of the great successes of the subsidised theatre that it takes on new ventures and does things that the commercial theatre does not do. I do not like to see the BBC paying hundreds of thousands of pounds a year to second-rate presenters merely because they are known faces. There should be hundreds of people within the BBC who have the capability to take over from these people. When they become so expensive, they ought to be spun out into the

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commercial world. The noble Lord, Lord Alli, who I am sorry to say is not present in the Chamber today, has followed that process in commercial television to great success. Every time he loses a producer from the "The Big Breakfast" programme he produces a new one who is cheaper and better. But, having our money to spend, the BBC ought to be doing that even better. To pay hundreds of thousands of pounds to second-rate talent, or to be kind to them, very much run-of-the-mill talent, should never be considered by the BBC.

As other noble Lords have said, the addiction to difference should certainly be carried into the question of sport. It does not matter whether premiership football is shown on ITV or the BBC. If it is there and broadcast on ITV, the BBC has no reason to wish to compete with that because it would be providing nothing different by doing so. Many sports and other activities are not featured on commercial television; the corporation should seek to cover them.

In combining both values and difference, the BBC needs a sense of importance. It needs to understand that democracy is important in this country and that it should give it good coverage and good understanding. But it has been walking away from that for many years. It needs to understand that we are part of Europe and that it must cover Europe, even to the extent perhaps of showing a few foreign films, and perhaps especially including programmes which give us an understanding of foreign cultures and of our partners in Europe. That is important to us. It is not being done by commercial channels and it should be done by the BBC.

Moreover, as the noble Lord, Lord Ahmed, and others have said, minority programming is important. It is important not just to those minorities themselves; it is also important to us, so that we have a window onto what other parts of our society are like and can learn from that.

I hope that the BBC will pay attention to what has been said in this debate. I do not see its presence here. The BBC has provided us with a great deal of information and has spent much time in trying to tell us what to say in this debate, but those concerned do not appear to wish to listen to us. When I have written to the BBC commenting on material that it has sent to me, I have never received an answer. The BBC appears to be heading in entirely the wrong direction. I hope that those concerned take a look at themselves soon.

5.53 p.m.

Lord Haskel: My Lords, when I saw my noble friend's Motion on the Order Paper, I had a little prick of conscience. Yes, conscience. The source of this unusual emotion was purely my enjoyment of public service broadcasting for many years; but I have never actually spoken up for it. I am most grateful to my noble friend Lord Bragg for giving me this opportunity to do so.

I have absolutely no interest at all to declare. I have enjoyed the quality of the entertainment, the excellence of the music, the authoritative news and information and the creativity of public service broadcasting. However,

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I have enjoyed commercial benefit too. Some 18 years ago, when the BBC did a series on computers and introduced the BBC Micro, my company bought a Micro for any employee who agreed to follow the course. That turned us into a computer literate company some two or three years ahead of our competitors. It certainly contributed towards the growth and success of the business. So I am a real beneficiary of public service broadcasting in many ways.

However, my noble friend quite rightly talks about the future of public service broadcasting. Does it have one? Like many noble Lords, I think that it does because the Thatcherite idea that public services are inherently bad and that private services are good has been demonstrated to be completely wrong. Public services are not better or worse; they are different. Some 15 years ago 70 per cent. of the public thought that large private companies served the public well and 30 per cent. thought that they did not. Today the position is reversed. As a result, companies now spend millions of pounds reinforcing their reputation because they know that a good reputation brings real benefits to their business. It is called branding.

Nevertheless, people still remain sceptical. As a result, public service institutions are becoming an improving brand. I agree with my noble friend Lord Currie that public service broadcasters need to capitalise on this and enjoy the benefits, especially the BBC. However, public service is no excuse for poor management. So I wonder why the BBC sometimes compounds the errors of other businesses. For example, it operates an internal market. But I believe that internal markets were discredited and discarded years ago by other businesses. I agree with my noble friend Lord Bragg who drew our attention to the over-large headquarters, which again most companies have discarded. The BBC really can invest in skills and training for its workforce without then having to sack large numbers to produce "shareholder value", as the noble Lord, Lord McNally, put it.

Public service broadcasters do not have to produce shareholder value. They should not compete with markets on market terms, as my noble friend Lord Puttnam put it. They have other measures of performance. For them, excellent public service is as legitimate a measure of success and satisfaction as increasing shareholder value or ratings.

Normal business accounting is inadequate and misleading where public service is involved. That is why public service broadcasters should not ape their commercial competitors. If they do, they will be forced--and I say this with apologies to my noble friend Lady Young--to dumb down. Markets find it difficult to measure social values and markets always grossly undervalue benefits to society. That is why we have regulators. They are there to correct this. But I say to the noble Baroness, Lady Flather, that regulation will not stop dumbing down. Market forces are much stronger than regulatory forces. We have seen proof of this in some of the most strongly regulated sectors of our society, as regards the food we eat, the trains we travel on and the financial services that we use.

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We should loudly proclaim the values of public service as an alternative to markets. Public service organisations can just as well move with the times and be truly inclusive yet be free of the strait-jacket of producing shareholder value for the market. The public service ethos provides information for minority interests and cultures. It requires suitable programming for our children who, as other noble Lords have said, learn an enormous amount from radio and television. Indeed, what an influence public service broadcasting has on them! I hope that the Social Exclusion Unit is looking closely at how it, too, can benefit from public service broadcasting and that it will take note of some of the comments that have been made in this debate.

I agree with my noble friend Lord Puttnam. Broadcasting funded by advertising, by sponsorship or by subscription cannot afford to deal with these matters. Moreover, as the nanny state shrinks, more than ever we need an informed population: informed to make the right decisions and, as my noble friend Lord Peston said, informed about science. Increasing competition and choice will not achieve this. Quality and reliability will. News has to come from a reliable source and there has to be an easy access to quality information so that people can make informed choices as citizens and as consumers.

This then is my argument for public service broadcasting. What can the Government do? First, they could foster public service broadcasting yet give it independence. Secondly, as my noble friends Lord Barnett and Lord Currie have said, they must ensure that it has sufficient finance to maintain the critical mass it needs to be an effective service and not become marginalised, as it has been elsewhere in the world. Public service broadcasting has been a wonderful ambassador, providing a showcase for our many talented actors, musicians, producers, designers and writers. Much of its authority comes from a public service ethos. Long may it continue.

6 p.m.

Viscount Falkland: My Lords, this is an extremely difficult debate to wind up because of the quality of the speeches. I have made copious notes but I am afraid that I shall have to abandon them because I cannot read them as I have written so much. This has been an excellent debate. As one would expect, it was ably introduced by the noble Lord, Lord Bragg. I have never been irritated by the noble Lord. I have always found his performances on radio and television to be extremely good. He set an example for us all in that he made a speech and gave some practical suggestions at the end of his speech as to how the BBC should move forward. He suggested setting up an independent commercial structure for all UK television so that the quality product we obtain from the BBC and other broadcasters would be protected in the USA. Buyers there could not drive down prices for programmes, as at present. That is an excellent suggestion.

Like most people of my age, I started listening to radio at an early age. I had a fairly peripatetic childhood. Fortunately, I had learnt to read and write fairly competently before war broke out. I found myself as an

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only child in various abodes during the following five years. I was grateful for the number of cheap children's books that were available. The classics were available, sometimes in abridged versions. My gratitude to the BBC remains intact. Like the noble Lord, Lord Birkett, I believe that if you want to know what true public service broadcasting is about you should listen to BBC radio rather than watch BBC television. Although there are many excellent programmes on television, there are many peaks and troughs, as other noble Lords have said.

In one of the rented homes to which my mother took me during the war I had a crystal set which was given to me by a Belgian refugee. I remember clearly to this day that one of my greatest achievements was to obtain a clear and consistent reception of BBC broadcasts with an irritating piece of wire and a tiny handle. Presumably my Belgian friend had received interesting broadcasts from his home country throughout the war. While I was at a boring public school I graduated to building a one-valve set. On Saturday nights I listened clandestinely to "Saturday Night Theatre" which stimulated my interest in playwrights and poets. I listened to readings from Hardy, Lorca and Oscar Wilde. Those were wonderful years of the radio broadcasting of drama. Much of the music I listened to went over my head--like the noble Lord, Lord Peston--but my interest in music was stimulated at that time. The Belgian refugee also gave me a mandolin as well as the crystal set, but I gave up on the mandolin. However, I became a competent operator of the crystal set.

The tradition of serious broadcasting on radio has been maintained in a praiseworthy manner, which probably has not been the case with television. Fortunately, I did not see a television broadcast until I was just over 17. That was the coronation of Her Majesty the Queen which I watched in France in black and white. I have never felt that television matched radio for sheer dramatic effect, even with an event such as that.

I mentioned my next point to my noble friend Lord Perry of Walton, who was the Chancellor of the Open University. If one is periodically an insomniac, one may think that a television programme will send one to sleep. One can tune in to a programme of the Open University at an early hour in the morning. That is an enormous revelation as there is no packaging. The programmes comprise expert, fairly anonymous presenters giving viewers purely the facts. My great quarrel with television is that it is too obsessed with packaging and presentation, which is expensive. That is not to say that there are not expert talented and usually young people involved in developing better ways of presenting graphics and improving presentation. However, I believe the BBC would do well to steer away from that aspect. I wish it would steer a course half-way between the Open University broadcasts and its present approach. That would be cheaper and I believe it would regain its constituency in terms of television broadcasts.

Noble Lords have made various valid points. The noble Lord, Lord Peston, spoke about dross. I absolutely agree with him. I wonder what length of time he has spent watching television. I know that he is a great

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expert at surfing the Net. I was puzzled to hear several noble Lords mention the excellence of the Internet. That does not square with an article in one of the broadsheets yesterday which stated that 90 per cent. of the material on the Internet comprises pornography. Even if the figure is 75 per cent., it is rather worrying. How is one not sidetracked by pornography when using the excellent BBC Internet? I have maintained for some time that pornography and sport are the only things that one can sell on subscription with any certainty, to the delight of accountants. I am rather concerned about this matter. I shall have to read Hansard and talk further to the noble Lord, Lord Peston, about that.

Unfortunately, I missed much of what the noble Lord, Lord Chadlington, said. However, I have been well briefed on it by my noble friend Lord McNally. Music is a subject close to my heart. There is an excellent article in The Times today by Andre Previn in which he harks back nostalgically to the time when he gave many concerts on television. He said that those concerts did an enormous amount to stimulate the interest of audiences in music. At that time people were keener to attend concerts of the London Symphony Orchestra than to attend many West End shows. It is noticeable that BBC television has dropped its concentration on serious music. Last night Mr. Will Wyatt addressed the all-party media group. He pointed out that there are remarkable BBC radio broadcasts of serious music from all over the world which comprise concerts, opera and other such events. There is a great difference between radio and television, as has been said.

As I have said, sport and pornography are probably the only areas in which the accountants of those who sell subscriptions are really interested. However, I am quite sure that their creative colleagues have much higher ambitions. The BBC must stop spending money on competing with the satellite channels with regard to broadcasting sport. I am afraid that is a lost cause. Broadcasters have concentrated on that and produced an excellent product because they know that is where money is made. If we can retain the broadcasting of certain sports through statute I think that is all one can hope for. The BBC will just have to rely on highlights as regards other sports.

As I have said, I owe a great deal to the educational function of radio. However, children's programming on television is dreadful. It is the dross. It is politically correct, boring and strident. I have a small child and I protect him from terrible cartoons. However, I cannot do so when he has a small friend to stay. It is obvious that when that child is restive or bored at home, he watches a cartoon. The BBC should stop broadcasting cartoons. Let others get on with that.

It has been an interesting debate. I agree that the high standards of the BBC over the years have upheld its great central role as a benchmark of quality. I agree absolutely with the noble Lord, Lord Hussey, who made a remarkable speech for someone who has been in such a prominent position. He was frank with us about his attitudes to public service broadcasting. His definition that it should uplift the hearts and enlighten the minds is the very best standard to which the BBC should

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adhere, not only for children but for all of us. It should stop trying to compete with those who are better furnished financially. The BBC has the licence fee. Everyone has tried to examine a better way of funding; it has not been found. The licence fee appears to be the only way. Let us give the public the confidence to support the funding of the BBC. Let us see whether the Government can persuade the BBC to get back to its natural constituency of average, normal, seriously- minded people who want quality rather than modern and politically correct programming.

6.11 p.m.

Baroness Anelay of St. Johns: My Lords, I, too, thank the noble Lord, Lord Bragg, for introducing this debate. He brings to it his long-term professionalism in broadcasting. Unlike others, I have no interest to declare. I bring to the debate my interest as a consumer and somebody who has been involved at the sharp end of enforcing the public's payment of a licence fee. As a magistrate I have adjudicated on cases of licence fee non-payment and evasion--as indeed has the noble Viscount, Lord Tenby, who is in his place. Evasion is a criminal offence.

The experience of adjudicating in that way concentrates one's mind very carefully upon the implications of broadcasting funded by a licence fee. It is right that noble Lords have posed questions this afternoon about public service broadcasting in general. Should it exist at all? Is it sustainable in the multi-channel digital future? Is it merely an anachronism? Will markets on their own give us the media and the society that we want? Is it an optional add-on or is it essential to the health of all broadcasting?

This is indeed a timely debate. First, as noble Lords have mentioned, the Davies Committee has been appointed to consider the future of the licence fee and the balance between the BBC's public service and its commercial activities. As my noble friend Lord Inglewood remarked, that is a narrow remit. I look forward to the publication of the committee's report this summer and the opportunity then to debate its recommendations.

The second reason why this is a timely debate is that we are experiencing a fascinating time of change in technology--that of the digital age and the multimedia revolution. Yet, at the same time as we face change, there are constants, such as the public expectation of a quality service that is easy to access. As my noble friend Lady James of Holland Park pointed out, we demand quality of both delivery and programming.

The Davies report and the new director-general, whoever that may be, must have a vision of the future which will serve the BBC for decades and not just until 2006. Although the public service broadcasting debate will quicken at the time of renegotiating the charter, I, like my noble friend Lord Inglewood, suspect that we need now to begin to debate what should be the ground rules of public service broadcasting into the next century.

As noble Lords have pointed out, there are two contrasting ways of looking at this debate, with some overlapping views in between. One version suggests that

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the duty of public broadcasting is only to provide programmes that no commercial broadcaster would touch. If one takes this idea to its logical conclusion, as some in the European Commission would do, governments would explicitly commission hours of programmes perceived by the government to be "good" for us, for which the mass market would not pay and for which therefore advertisers would not pay. The second version is that in the new, vastly expanded broadcasting environment, the market will provide and there will be no need for public service broadcasting. It is tempting in that world to believe that television is just another consumer commodity, best left entirely to market forces and global trends.

So is it right to argue that broadcasting is too important to be left at the mercy of the market or too important to be left in the broadcasters' hands? As world audiences fragment under the competitive pressure from satellite and cable, is there a risk that diminishing audiences will reduce the ability of mainstream broadcasters to afford original, expensive and innovative productions? Is there a widening gap between the information rich and the information poor, one that is accelerated by the growth of subscription and pay-per-view? Without public service broadcasting, does the global media market risk homogenisation? That is a lovely bureaucratic word but, as noble Lords have pointed out, one which perhaps means the dawn of the Murdoch world. From what noble Lords have argued today, the answer to all three questions may be "yes".

We talk a great deal about the impact of the digital age on public service broadcasting, but the underlying issues remain the same. How do broadcasters balance commercial activity with their public service broadcasting remit? How do broadcasters maintain the quality of their programming? And, as noble Lords have mentioned, what form should regulation take?

The BBC has recently faced many an accusation, one of which is that the public service dog is being wagged by the tail of its ambitions to become a global broadcaster. Much attention has been paid to that accusation in the debate. Even Sir Christopher Bland admitted that the BBC is treading an increasingly delicate line by setting up an assortment of new public service and commercial channels while at the same time trying to preserve its traditional strengths on public service television channels and radio stations. Fears that it was compromising its core television and radio service erupted last year when it lost rights to live TV test match cricket to Channel 4. I was very much aware of that eruption in my home environment. My husband made me aware of it very painfully--not painfully to me, painfully to the television.

The BBC's opponents claimed it was stretching itself too thin with ventures such as its loss-making international news channel, BBC World. Last month I visited the "Where's Q" digital project, an exciting and innovative project, one in which the BBC could lead the world. I hope that it does. I hope that it has that opportunity. But, at the same time as wishing it well on that project, I appreciate that the project underlines questions about the role of public service broadcasters in a digital age.

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Many noble Lords have mentioned the BBC's Internet services. I have to confess that I have something in common with the noble Lord, Lord Peston: I, too, am an Internet groupie. I have not accessed the pornographic sections--and indeed the noble Lord is indicating that he has not either. Other noble Lords may well indeed give us some education on this, although I am not too sure whether it would be educational.

There is a free-rider problem with regard to the BBC's Internet services. Licence payers are funding an excellent Internet news service to the citizens of the world. There are of course many advantages to that, but I am concerned that the Internet may become the successor to the World Service. Does it or can it really ever offer the access that radio does to those who are the poorest users in the third world? Could it be a Trojan horse destroying the World Service from within? I note that BBC Online recently decamped to Bush House, the home of the World Service.

Mention has been made of chat shows. In the United Kingdom we will all be watching and listening to discover how the BBC will respond to the charge that it is "dumbing down" or "widebrowing", a new term I have learnt tonight. Playing up to the ratings war, I believe, is what it is all about. As my noble friend Lord Monro of Langholm pointed out, there is an underlying feeling among the public that the BBC and other public service broadcasters should not be driven by that need to play up to the ratings war.

I would question the role of chat shows for a public service broadcaster. After all, TV shows like the "Vanessa" show, which has been mentioned, have given a whole new meaning to the term "faking it". Perhaps the only certainty in all of this is that the licence fee payer expects the BBC to produce good quality programming as its public service responsibility, a point my noble friend Lord Lucas argued so well today.

Recently I attended the launch of the essays Public Purposes in Broadcasting--funding the BBC and found the presentation, including one by the noble Lord, Lord Currie of Marylebone, who spoke earlier in the debate, and the book itself a stimulating introduction to the work of the Davies review. Public service broadcasters should continue to have a clear responsibility to provide a wide range of programmes that challenge but without causing offence. I believe that the public will expect of public service broadcasters in the digital age exactly what they expect of them in the analogue age--quality, diversity, innovation and independence. On a personal note, if I am persuaded in favour of public service broadcasting by any argument, it is quite simply this: that without it we could lose the opportunity of being surprised by programmes that we did not know we wanted.

6.20 p.m.

Lord McIntosh of Haringey: My Lords, in thanking my noble friend Lord Bragg and all noble Lords who have taken part in the debate, I can start from a point of agreement with everyone who has spoken. By that I mean an acknowledgement of the strength of public service broadcasting in the United Kingdom. But

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beyond that I have to say that I will not be able to follow a large number of the contributions because the debate has been very personal--it has been very attractive for that reason--and has concerned people's feelings about particular BBC programmes.

My noble friend Lady Young said that she expects me to rise to the defence of the BBC. That is not the job of the Government. I cannot do that. I am certainly not going to find myself defending or attacking "Vanessa", "One Man and his Dog" and "Jerry Springer". I am tempted when the noble Lord, Lord Birkett, refers to Radio 3 and Classic FM. I shall break my rule for a moment to say that the reason one wants continuous music is that some of us are not continuous listeners; and when we switch on, we want to find music. That is the answer to the noble Lord's question. I shall not break my rule again.

In that way the debate has been remarkable. Time after time noble Lords have expressed undying devotion to the BBC and then they have gone in for stinging criticism of the way in which it operates. The noble Lord, Lord Lucas, asked whether the BBC will be listening. It will be listening; he can be sure of that. The noble Baroness, Lady Flather, managed to describe the BBC as a whipping boy and a sacred cow in the course of a single speech. That is quite an achievement.

I have to move on from that not only because it would be improper for me to respond as if I were speaking on behalf of the BBC, which I cannot, but also because the subject of the debate is the future of public service broadcasting in this country. That is what I want to talk about. Public service broadcasting, however one defines it, is not just the BBC but other television and radio channels which have had a degree of regulation that will no longer be possible.

The noble Lord, Lord Birkett, proffered definitions and a number of noble Lords, including my noble friend Lady Young, offered definitions of public service broadcasting. I do not want to do that. I have an agreement with the lexicographers. They do not determine government policy and I do not write dictionaries; and we are better off that way. We must recognise that the future of regulation, which has been a contributory factor, if not the only factor, in the success of public service broadcasting in this country, has to change. It is changing and it has to change more. Spectrum scarcity, which has been the basis of regulation, has been undermined already by cable and satellite and it will certainly be undermined a great deal more by the advent of digital radio and television. I shall argue that these changes in technology will not only continue the need for public service broadcasting, as the noble Lord, Lord Inglewood, said, but will actually increase it. In doing so, I shall acknowledge straightaway my debt to the thinking and writing of Andrew Graham, an economist and Master of Balliol College, Oxford, who I think is the most creative and logical of all thinkers on this subject.

It seems to me that there are three essential elements in public service broadcasting. The first is: who produces it; what is its origin; what is the industry structure behind broadcasting? The second--this has

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taken up 90 per cent. of the time in the debate--is: what is in the programme; in other words, what we in industry would call the design and manufacture function. The third is: how do people get to see the programmes; access; what we would call marketing and distribution. Unless we look at all three of them, I do not think we will understand the nature of the problems and opportunities that we will face.

The first thing we have to recognise is that new technology in itself does not ensure that there will be new players. In a valuable publication, to which reference has been made, my noble friend Lord Currie said that changes will come about from the smaller players. I am sure he is right. The problem is to ensure that there will be smaller players rather than concentration. The problem is that, on the contrary, new technology pushes towards concentration of ownership and fragmentation of audience. A quality product, which is the essence of what we are discussing here, is inevitably expensive to produce and it will not become cheaper to produce. Indeed, it may become more expensive because of the shortage of first class talent. That is particularly true of the example of sports rights, to which reference has been made.

Broadcasting has high fixed costs which encourage larger players. But it is also cheap to disseminate. We can move from television to film, to video, to radio and to press. The feature here is of low marginal costs. That is a move from one kind of monopoly or oligopoly of spectrum scarcity to a different kind of monopoly, a natural monopoly, of economies of scale--that is, the high fixed costs--and of economies of scope--that is, those who have the product can make more money by selling it on. That was acknowledged by my noble friend Lord Currie. This is what we are talking about when we face convergence between print, telecommunications, computing, broadcasting and other means of communication.

The noble Lord, Lord McNally, referred to shareholder value. What I say to him is that in general terms monopoly is bad; private monopoly is worse; media monopoly is worse; and private media monopoly is worst of all. That is the threat we have to face. So what should be the public's policy objectives under those circumstances? First, we have to be clear that public service does not mean public service broadcasters only; it has to be public service as made available by the commercial sector. But we can be certain that public service will not be produced by the commercial sector or the market only. In other words, the need for the preservation of a non-commercial sector in media ownership and in broadcasting ownership is critical.

The Broadcasting Act 1996 allocated digital spectrum; it gave more scope to the BBC and to the existing channels; and it ensured that those with a public service remit would be allocated space and that those with space would be required to carry public service broadcasting. In addition, there are cross-media rules enforceable by the Monopolies and Mergers Commission, which will be a strengthened competition commission when the Competition Act comes into force. I do not have answers to these problems. However, I want the House to know that the

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Government recognise the difficulties that exist and the inadequacies of some of the solutions that have been found in the past.

I shall say rather less about programmes, even though other noble Lords have said more. I wish to set out what public service broadcasting is not. It is not merely what the commercial sector does not offer. I entirely agree with the noble Baroness, Lady Anelay, who made a most thoughtful and constructive speech. It is not just a safety net. It is not just a niche. Nor is it just particular kinds of programmes, however valuable they may be--it is not merely news and current affairs or religious broadcasting. I say to the right reverend Prelate that I believe the advisory panel on religious broadcasting has been making representations to the BBC on the points that he raised. It is not merely education, important and all-pervading as that is, and ought to be. It is not just such things as costume drama. It is not just minority programming. I am sure that my noble friends Lord Ahmed and Lady Flather, among others, would not wish minority programming to be in the ghetto of public service broadcasters. It should be everywhere, in all kinds of offerings.

Like my noble friend Lady Young of Old Scone, I take the view that public service broadcasting has to be defined in terms of the whole spectrum of quality programming. My noble friend Lord Peston made the same point. The noble Baroness said that it has to be good of its kind. That is the proper criterion.

Public service programming is an approach to broadcasting rather than a particular kind of broadcasting: an approach that has the objectives of seeking to entertain, inform, educate and challenge people into new thinking. It should pervade both the BBC and commercial broadcasting.

What are the public policy objectives? It is certainly the Government's wish that the BBC should survive and adapt to the new conditions. I recognise the fears expressed on this matter by my noble friend Lord Barnett but do not entirely accept them.

There are five key principles that should apply to the BBC. It should act as a benchmark for quality, driving up standards across the board--my noble friend referred to "vital standards". It should provide something for everybody, making the good popular and the popular good. It should inform, educate and entertain, expanding people's horizons with new and innovative programming. It should operate efficiently and effectively and provide value for money for licence fee payers. I shall return to some of these points as they were raised in the debate. And it should stimulate, support and reflect the diversity of cultural activity in the United Kingdom, acting as a cultural voice for the nation.

I shall not say anything more about the BBC at this time as I must respond to particular points about the BBC which are issues of public policy. I wish to move on the third element of public service broadcasting; namely, the question of access--what I termed marketing and distribution.

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Many years ago, Lady Plowden said: "Broadcasting is democratic. There are no reserved seats". It was true when she said it. I wonder whether it is true now. I wonder whether, with the development of pay-per-view and subscription television, we can still say the same. It may be democratic in the same way as we are all free to go and eat at the Ritz, but some of us cannot afford to do that. I wonder, also, with the proliferation of channels, whether we still have the universal geographical coverage which we have built up so painfully over the years. More than that, when we move further into multiple-channel offerings, whether digital, on-digital or cable and satellite, the question of how we find what we want to listen to or watch will be increasingly important. We shall need what is called the electronic programme guide, which is the equivalent of an operating system on a computer. Here again, we are in difficulty.

The cable and satellite operators have said that they will provide interoperability between their set-top boxes. Indeed they have set a date--15th March. Oftel and the ITC are supervising the process. The noble Lord, Lord McNally, invites me to "bang heads together". I do not know whether at some stage that may be necessary--or at least, it may be necessary for Oftel and the ITC to bang heads together. Certainly, it is absolutely critical, if we are to have public service broadcasting that works, that people know where to find what they want to watch.

So far as geographical coverage is concerned, the 1996 Act regulated it and set priorities for the best, most available multiplexes. Subscription and pay-per-view will continue as a funding mechanism--it must do. It will be moderated, as it has been to some extent by the listed events provisions. But there are enormous difficulties in the way of the continuation of public service broadcasting as it has been viewed during the course of this debate. So let us return to the fundamental principle behind public service broadcasting: quality and diversity free-to-air.

Perhaps I may now turn to the public policy issues raised in relation to the BBC. I cannot spend very much time on the issue of the licence fee, much as I should like to. The Davies working group is in place. It will report by the end of July. It is not covering the wider issues of governance. Those are matters for the Charter review which will take place closer to the time when the Charter is up for renewal. I am sure that Gavyn Davies and his colleagues will read carefully what has been said in this debate.

A number of number Lords spoke about the need for new channels, which are possible in the digital world. In a most interesting speech, the noble Lord, Lord Chadlington, talked about a channel which provided access to lottery funded arts and sports. That is a thought which deserves serious consideration.

In his maiden speech, my noble friend Lord Bragg referred to the need for an opportunity channel which would provide a showcase for newly trained people coming into the media. That is another suggestion that deserves further consideration.

There was much less reference than I should have wished to education in the debate. Noble Lords will wish to know that the BBC is proposing BBC

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Knowledge, a purely educational channel. We must make sure that the opportunities that are available through the increased spectrum provide not just high quality education for children, and above all for adults, but that we can find a way of making the output accessible and making sure that people know where to find it.

A number of noble Lords referred to the BBC's investment in digital programming--my noble friend Lord Bragg in a less friendly way, some noble Lords in a more friendly way. Yes, it is the case that the BBC is spending £200 million, 9 per cent. of the licence fee, on digital provision. It has been allowed to keep the £250 million which it received from the sale of its transmission services facilities. That is contributing towards that expenditure.

The vexed question of audience share and market share took up a great deal of time. The noble Lord, Lord Addington, thought that it was an unwinnable contest. But others, more closely reflecting the view of the Government, thought that there must be a critical mass of audience achieved by providing what is good of its kind in a wide range of programming types in order to ensure that the BBC continues to have the respect of its audiences and continue legitimately to claim the licence fee. My noble friend Lord Currie put it correctly when he said that the BBC cannot be marginalised in terms of viewing. I was grateful for what my noble friend Lord Puttnam said about the training role of the BBC and I hope that that will be taken very seriously.

There was considerable debate about the commercial activities of the BBC. They were applauded by Lord Currie and deplored by some others. My noble friend Lord Bragg made a very interesting and worthwhile suggestion about an independent collective marketing arm for all UK television and radio. That may go against what other noble Lords were saying about the value of the BBC brand. That again deserves further discussion.

The noble Viscount Lord Astor queried whether BBC Worldwide was adequately distinct. I can assure him that the BBC publishes separate accounts for BBC Worldwide and these are publicly available. In any case Gavyn Davies is looking at the balance between the commercial activities and the non-commercial activities of the BBC.

Reference was made to the European Commission competition law. I am grateful to the noble Lord, Lord Inglewood, for reminding us that there is a protocol to the Amsterdam Treaty which legitimises state aid to public service broadcasting. My noble friend Lord Currie referred to this as well. There is of course a problem with mixed state funding and advertising funding but that will have to continue to be fought out between the different directorates general of the European Commission.

I close by re-emphasising the Government's view of the importance of public service broadcasting. This is a matter of the highest social and political importance. We see this as an essential element of citizenship. Broadcasting is part of the democratic process, as the noble Lord, Lord McNally, said. Research has shown

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that television and radio have become a prime source for the way in which we see the world, the way in which we take in information, and the way in which we see ourselves as a community and as individuals. It must be asserted that we have the right to this information, and that assertion in turn means that we must defend public service broadcasting to the end. Information must be an essential part of our society like public safety, health and education. All the issues which have been debated this afternoon are public policy issues. We need to continue to debate them. I am grateful to noble Lords for the contributions they have made to that essential debate.

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