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Lord Luke moved Amendment No. 31:

(c) to seek the views of persons providing services and facilities in relation to which OFCOM have functions on which of these functions should be subject to review."

The noble Lord said: I shall speak also to Amendment No. 32. I suspect that the importance of ensuring that the regulatory regime keeps pace with advances in the industry will become a recurring theme in our discussion of the Bill.

Amendment No. 31 is designed to ensure that the regulator consults the communications industry on those regulatory functions that should be subject to review. It is most welcome that Ofcom is required from time to time to review the regulatory burden and to identify those aspects of the regime that are no longer necessary or applicable, but I am concerned that despite those welcome inclusions, there is still a danger that Ofcom may lose sight of the views of those whom it regulates.

From the experience of the Independent Television Commission and Oftel, we know that new developments in the communications industry can call existing regulation into question. The amendment would simply mean that Ofcom would consult the relevant service providers on those aspects of regulation that it believed should be subject to review. It would give business stakeholders confidence in the regulator's approach, while allowing them access to the detail and conclusions of the regulator's discussions. It

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would also allow businesses to plan ahead with a clear view of how future regulation would affect their industries—whether as suppliers or users.

It would not require Ofcom to act on the consultation, but to give network and service providers the opportunity to participate in the regulatory discourse would help to ensure that the industry's regulatory regime would more accurately reflect the needs of communication providers.

Amendment No. 32 is intended to enhance the industry's ability to co-regulate—to promote the maintenance of a self-regulatory function by the industry with back-stop powers for Ofcom. I ask the Committee to note the use of the words, "offer adequate opportunities", and, "as appropriate". The last thing that I should want is to impose a requirement on a self-regulatory body to report to Parliament.

I understand the purpose of Clause 6 as being to promote a range of regulatory mechanisms, including co-regulation or, as the Joint Committee called it, accredited self-regulation. I further understand that to mean that any opportunities to expand the frontiers of self-regulation would be taken.

I presume that Members of the Committee who will speak to Amendment No. 33 will have more to say about accredited self-regulation. My point is that those involved in self-regulation are not necessarily free from obligations to transparency and accountability. It is reasonable to write those principles into the Bill to allow for any such future developments.

The amendment would merely allow Ofcom to consider what opportunities for accountability would be appropriate through it to Parliament and the Secretary of State. I beg to move.

Lord McNally: Amendment No. 33 is included in this group. As the noble Lord indicated, it allows us to discuss the pre-legislative scrutiny committee's ideas on self-regulation. It is a matter on which we agree with the Government. The Government stated that they wanted self-regulation to be extended wherever possible. We think that that is a very good approach and that those are good guidelines so far as concerns Ofcom and the whole communications industry.

I noticed today that the new chairman of the Press Complaints Commission has put forward seven points to improve self-regulation in that area. It is sometimes said that this House has no power. Yet I read this morning that the BBC has suddenly started to think again about how its accounts might be subject to the scrutiny of the Public Accounts Committee. Today the new chairman of the Press Complaints Commission has come forward with some bright new ideas about self-regulation. I cannot think that these new thoughts from those bodies are entirely divorced from the fact that we are busily working on this business at present. We should be very encouraged to find that our endeavours are causing rustlings in the undergrowth in various parts of the forest.

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On this amendment, we think that, for self-regulation to carry the credibility it needs, Ofcom should be able to set down guidelines on proper self-regulation, against which the public and the sectors concerned can measure themselves. Accredited self-regulation is certainly not what, I think, was termed "a slippery slope to state control" in any of the sectors. It is exactly as the amendment suggests. It sets broad guidelines by which both the industry and the public can judge how a self-regulatory body goes about its business.

The whole idea of this amendment is to try to push forward so far as possible the concept of self-regulation. Here we stand shoulder to shoulder with the Government. It is far healthier for all sectors of the communications industry, and for relations between the sectors and the Government. We already have a good example of self-regulation working. I see the noble Lord, Lord Borrie, moving in his seat. I hope that he will contribute to the debate. The Advertising Standards Authority, now chaired by the noble Lord, Lord Borrie, has set a good example of how a body can be respected by the public and the sector. I understand that the ASA is in discussion with Ofcom, and I hope that it can conclude those negotiations successfully. That would set an example to other parts of the communications industry.

Lord Puttnam: I rise to support the noble Lord, Lord McNally, and to prove that the "Gang of Four" are as one.

As with so much during the work of the Joint Committee, the concept emerged from evidence. It was not dreamt up. Much of the evidence that we took was dispiriting, but, in this area, the evidence was overwhelmingly positive. We became very enthused. The purpose of the amendment is to say to the Government, "Please don't hope passively for self-regulation to emerge. Why not actively grab it? You have the ball at your feet". The idea of accredited self-regulation is neither odd nor particularly new. It is an idea in the wind, and it gives the Government the ball, so that they can get cracking with a new, more enthusiastic and determined form of self-regulation.

The noble Lord, Lord McNally, is right. We have the best possible example represented on the Benches behind the Government. My noble friend Lord Borrie and the Advertising Standards Authority provide a superb example of what is possible. What we say here tonight will be heard in places such as the Press Complaints Commission. The Government must evince determination to support forms of self-regulation and the sense that it is the way of the future. Whatever we say tonight—whatever the Government say—I guarantee that, 10 years from now, self-regulation will be the norm, not the exception. That is the direction in which things are going, and accredited self-regulation must be the answer.

We did a lot of work looking back at how, over the past 10 or 15 years, various professional bodies had, with enormous pain, come to terms with the fact that they had to get their act together and become more transparent. It is not surprising that professional

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bodies go through that pain barrier, but here is an opportunity for the Government to help them by promoting the concept of self-regulation. We are not suggesting tonight who the accreditor should be. Different bodies could be accreditors for different industries. It is a great idea, and the Government would do themselves an enormous service by enthusing about it and promoting it. The important subsections are subsections (4) and (5). They make the point. Without those subsections, the clause is limp; with them, we can point out clearly the way ahead.

I must also say that the words "monitoring and" should be removed from proposed subsection (3)(d). That role already exists, and it would be inappropriate to the suggestion that we make to include the monitoring component. I urge the Government to take the rest of the amendment seriously. They would do themselves and the nation as a whole a great service.

Lord Borrie: I shall speak only to Amendment No. 33. I declare an interest as chairman of the Advertising Standards Authority, which adjudicates—and has done so for a long time—on non-broadcast advertisements, to determine whether, because they are misleading or seriously offensive, they should be banned.

Amendment No. 33, put forward by the "Gang of Four"—if I may use that expression—for our deliberation, deals with guidance from Ofcom on standards for effective self-regulation. Generally, the objectives of those standards are set out in subsection (3) of the proposed new clause. They seem to me to be sound. I had some reservations about subsection (3)(d), but my noble friend Lord Puttnam said that the words "monitoring and" should not be included, so I shall read the paragraph without them. It says that the objectives are,

    "that the person or body responsible for...enforcement of the method of self-regulation has an appropriate measure of independence from providers of the relevant service".

I trust that the noble Lord, Lord McNally, will forgive my being pernickety. It was not the Advertising Standards Authority but a task force chaired and led by the Advertising Association, which has been in discussion with Ofcom over a period of time, that proposed to Ofcom a self-regulatory scheme for the control of broadcast advertising; that is, advertising on radio and television. The Advertising Association task force has included advertisers, agencies, broadcasters and so forth. As Members of the Committee have already said, the model it put forward is explicitly modelled on the existing Advertising Standards Authority.

This existing system, comprising an adjudicatory body with a majority of non-industry people, is independent. I am grateful for those Members who said that it is well regarded. It certainly has a good basis of finance, with the Advertising Standards Board of Finance levying a 0.1 per cent impost on advertising billings so that—although anyone in my position would say that we never have enough money to do our job—we have been well-resourced.

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My noble friend Lord Puttnam perhaps is withdrawing the word "monitoring" from the amendment, but "enforcement" under the non-broadcast system run by the ASA is partly done by the industry itself; namely, the Committee of Advertising Practice, a federation of trade bodies representing advertisers, agencies and the media. The ASA's adjudications are accompanied by publicity and by the requirement to withdraw the advertisement and not to repeat any advertisement which has been found to offend against the rules. If necessary, in relation to a recalcitrant advertiser, the ASA will report the matter to the Office of Fair Trading which, being a statutory body, has legal powers to take action for an injunction under the control of misleading advertisement regulations.

I have a reservation about subsection (3)(d) of the proposed new clause. However, the existing system for non-broadcast advertising also gives an enforcement role to the industry—to the Committee of Advertising Practice—working with its member associations, which includes media associations, in order that they are warned by so-called "ad alerts" that a particular advertiser and a particular type of advertisement should not be permitted. Similarly, the Royal Mail, which is a part of the Committee of Advertising Practice, will withdraw its bulk mail discount from an offender.

I am speaking about self-regulation of non-broadcast advertisements. It seems neither surprising nor a matter to be criticised that the industry itself takes a hand in the matter of enforcement. I do not know and would not presume to tell Ofcom what the best arrangements may be for monitoring or enforcing any self-regulatory control scheme which it devises or accredits for broadcast advertisements in due course. We may be a little unwise if we prescribe in this Bill who or what kind of body does the enforcement. Independence, referred to in paragraph (d), is vital for any adjudicatory body, but in terms of enforcement there could be a mix of ways in which this is done. If the phrase self-regulation means anything, it surely must mean that the industry itself helps to do the enforcing.

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