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Lord Holme of Cheltenham: I reply exclusively in regard to Amendment No. 192. I regret the rather dusty answer given by the noble Baroness. She will have sensed that a number of senior

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parliamentarians—the noble Lords, Lord Peyton and Lord Brooke, and the noble Baroness, Lady Jay—support the idea that a public service obligation must include proper coverage of Parliament in a parliamentary democracy.

The Minister may well be right in saying that there is a better of way achieving this—perhaps it should be attached to the black hole of what is public service broadcasting—but when she can say in the same response that parliamentary coverage is an important part of public service broadcasting but, moments later, that it is not an obligation in the definition of public service broadcasting, we have an indication of what the problem is. We do not have an adequate definition of public service broadcasting which includes this vital aspect.

I am most grateful to all Members of the Committee who contributed to the debate—my co-signatories to the amendment, my noble friend Lord Phillips and the noble Lord, Lord Puttnam. I am not quite sure about the clerical embrace. I am dealing exclusively with the issue of parliamentary coverage. The right reverend Prelate has his own, very understandable, agenda and I am not sure that I fully accept the analogue.

The only dissentient was the noble Baroness, Lady Howe, who I had the honour of succeeding at the Broadcasting Standards Commission. I am not absolutely sure that I can do justice to her objection so I shall not even try.

But, with that exception, there seemed to be a very strong feeling that the Government should find a way of addressing this problem rather than simply saying that it will be all right on the night. I shall withdraw the amendment now but it is a subject to which we shall return at a later stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Howe of Idlicote moved Amendment No. 193:

    Page 237, line 24, leave out from "serious" to "and" in line 25.

The noble Baroness said: Perhaps I may start by correcting the impression that the noble Lord, Lord Holme, gained from what I said that I was against his amendment. Far from it. I would be totally in support of it. I was merely using the excuse that I was able to withdraw a few words from the Bill rather than having any objection to the interesting proposals outlined. I hope that he will forgive me and accept my apology.

I find what the Minister said about the amendment rather extraordinary. I am not a lawyer—I remain to be corrected later—but, bearing in mind what was said by the noble Lord, Lord Phillips, of how this gives an impression of over-dominance of the market, which is absolutely true, I should have thought that removing this repetition, which is exactly what it is, from the Bill would have improved matters.

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As I read the Bill, omitting from subsection (2) the words suggested in the amendment would mean that there had to be a serious failure and that Ofcom would have to determine that the situation required the exercise of its powers. In making such a determination—it is yet further qualified—Ofcom would have to take account of all the other matters, including the points that I thought we were busily removing from the Bill.

I am a little unhappy about the Minister's reply. I shall of course go away and read exactly what she said but, at the moment, I am not very content. I wish only temporarily to withdraw the amendment.

The Deputy Chairman of Committees (Lord Ampthill): The noble Baroness, having spoken to the amendment previously in its place in the group, has now spoken again at some length. I therefore have to ask her to move the amendment so that there can be a further response. The noble Baroness cannot speak to the amendment without moving it.

Baroness Howe of Idlicote: In which case, I beg to move.

Baroness Blackstone: I have nothing to add to what I said. The amendment was grouped with Amendment No. 192, which has already been withdrawn.

The Deputy Chairman of Committees: What does the noble Baroness now wish to do?

Baroness Howe of Idlicote: I hope that I am doing the correct thing. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 267 [Power to amend public service remits]:

[Amendment No. 194 not moved.]

4.30 p.m.

Clause 61 [Must-carry obligations]:

Lord Avebury moved Amendment No. 195:

    Page 62, line 23, at end insert—

"(g) any local digital television service,
(h) any access radio service."

The noble Lord said: Clause 61 contains provisions which ensure that services on the must-carry list are carried by networks used by a significant number of end users as their principal means of receiving television. Subsection (3) is the starting list of the services, which can be amended by the Secretary of State following a review under subsection (8). That review must consider the public benefit which any additional service would offer, the spare capacity available to the providers of the electronic communications networks to whom the must-carry obligations apply, and whether the burden of compliance is proportionate to the objective of securing that particular services to be added to the list are made available to the public by this means.

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In this amendment we ask for local digital television and access radio to be added to the list in the Bill without having to wait for a review. The Joint Committee said at paragraph 144 of the report that the extension of the must-carry list was,

    "a matter of considerable public interest"

and the Government envisaged that the power to amend the list might be used to include,

    "further channels which may have a general public service remit, or may offer Government or local information services".

We suggest that adding these services now would encourage rapid growth of local digital TV and access radio all over the UK. The Community Media Association tells us that it regularly receives inquiries from groups, often involved in regeneration projects or community development, who would like to run a local channel on cable but have been unable to interest the cable channels in their proposals. In fact, some existing local and community television stations such as Leicester Channel 7, Cambridge and Birmingham, have closed down as the cable industry has consolidated.

Other countries have must-carry obligations in their rules similar to those in this amendment. In the US, Canada, Germany and Sweden, that has led to the creation of many successful local and community channels. These can provide a unique service of local news, local sport and culture, and offer to local people the possibility of becoming involved in their own programming. In the context of this Bill, Clause 241 already requires that local digital TV brings social and economic benefits to the area. Clause 258 requires that access radio,

    "confer significant benefits on the public".

Therefore, the public benefit requirement is already satisfied. It is a question of looking at the network capacity and the proportionality of the burden to the advantages of adding these services to the list. Since this comparison must have been made already in the four countries mentioned, it was concluded that the must-carry obligation should be extended in the manner we suggest here. I hope that the Government can accept the amendment. I beg to move.

Lord Lipsey: I shall speak to Amendments Nos. 195A and 195B, which are grouped with Amendment No. 195. Basically, they represent level playing field amendments. I hate that analogy but it serves to accelerate matters. It is the level playing field between cable and satellite as regards must-carry. The position at the moment is that cable must-carry carries for nothing. On the whole, satellite carries for quite a lot of money because of the need to buy additional access.

The amendments tackle the problem by asking that regard be had to, not just the sheer cost to cable, and so on, of supplying cable must-carry services, but, more importantly, the opportunity costs. They take up band width on the cable which someone else cannot buy. That should be taken into account and not merely the financial cost.

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The amendments further ask that regard be had to the level playing field and the adverse effects on cable relative to satellite if too much is ladled on to cable operators in terms of their must-carry obligations. These are modest amendments. I hope that the Minister can give me either comfort or agree to accept them.

Lord McIntosh of Haringey: We are in the curious position of returning to Clause 61, which is what happened in another place as well. It seemed to make sense that we should deal with must-carry together with must-offer and must-provide. That accounts for the order in which we are taking these matters.

The purpose of Clauses 261 and 268 to 272 is to give effect to our policy on must-carry, must-offer, which is to ensure that all public service channels are universally available on all main platforms free to view both before and after switch-over. Clause 61 lists the services which must be carried. The clause also provides that the list can be amended by the Secretary of State. Any amendments will be subject to an assessment of the impact of an amendment to the list and also consultation with the network operators. I believe it will be understood that we are resistant to making any additions as Amendment No 195 would, without making an assessment of the impact or without consultation with the network operators.

Apart from anything else, the whole of the must-carry regime has been designed to be restricted to television and not extended to radio as Amendment No. 195 seeks. The reason for keeping the process as streamlined as possible and restricting it to all main platforms is very straightforward. We recognise that there are burdens with must-carry with costs and benefits. They have to be assessed. Clearly, local digital television, although admirable, is not in the same category as those described as public service channels which are universally available on main platforms.

I turn now to Amendments Nos. 195A and 195B. They would add further factors to the consideration in making a list of must-carry. The noble Lord, Lord Lipsey, has been very clear in setting out that it is not simply a matter of cost, but also of opportunity costs when there is restricted band width. But the principle that we have worked on in Clause 61 is that there should be an opportunity for review and consultation with network operators. It does not require further primary legislation.

I am well aware of the costs for network operators in must-carry and that cable companies are conscious of the burden. For cable companies the burden of carrying must-carry stations is balanced by the opportunity they have of getting more viewers subscribing because they provide a wider choice. That is why we have the provision for review.

Amendment No. 195B aims to ensure that must-carry will not create any discrimination or competitive imbalance between network operators. It is very

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difficult to read it in any other way than preventing the implementation of must-carry. Clause 61 applies only to those networks,

    "by means of which public electronic communications services are provided that are used by a significant number of end-users as their principal means of receiving television programmes".

Networks that are not used in this way will be unaffected. Therefore, to this extent the imposition of must-carry obligations is bound to lead to some degree of "discrimination" if we are to take that term literally.

I am aware that cable operators feel they are at risk of suffering competitive disadvantages as compared with other network providers, such as satellite operators. I understand their concerns. We will have regard to the competitive status of all the affected markets—the broadcasting market, as well as the market for the provision of broadband services. But we see must-carry as a key means of ensuring the universal availability of public service broadcasting, both before and after switch-over. It is a central component of our broadcasting policy, which we could not jeopardise in the way that Amendment No. 195B does, although no doubt unintentionally.

Turning to government Amendment No. 195D, Clause 271 provides the initial list of must-provide services and gives an order-making power to the Secretary of State to modify that list. In its report on the Communications Bill, the Select Committee on Delegated Powers and Regulatory Reform commented that this was a "significant" power and recommended that either the power should be made subject to the affirmative resolution procedure or that the criteria according to which it is to be exercised should be specified. We prefer to specify the criteria because that helps to align it with Clause 61.

Therefore, we set out the criteria for the exercise of the power to amend the list. It cannot be exactly the same as Clause 61 because the two clauses serve different purposes. Clause 61 deals with "must-carry". Clause 271 relates to the "must-offer" provisions in Clause 269 and the "must-provide" provisions in Clause 270. "Must-provide" relates to broadcasters and would place a much more specific obligation on them collectively to make arrangements for persons who cannot otherwise receive digital television to have access to it, free, via satellite.

This amendment provides that, in exercising her power under subsection (2) to amend the list of must-provide services, the Secretary of State must have regard to the public benefit to be secured by the modification, the likely financial effects of the proposed modification on the affected parties and the proportionality of those effects when set against the public benefit secured. I shall seek to move this amendment in its due place.

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