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Baroness O'Neill of Bengarve: The amendment lies at the core of what is needed to improve the Bill. It would be nice to think that we know now how to mitigate the power that ownership gives and that we have reached a stage where the perfection of regulation is such that we can relax and allow ownership to fall where it will.
Those of us who have lived in heavily regulated sectors of our society have a tiny degree of scepticism about the perfectibility of regulation. That is why I spoke earlier today about the importance of belt and braces, and why I support the amendment.
Lord Gordon of Strathblane: I intervene briefly, simply to say that I can see no grounds for making any distinction between Channel 3 and Channel 5, except in one small respect, which is remediable: both were licensed by the Independent Broadcasting Authority. The fact that one is a larger body than the other is very much a temporary factor of the programmes produced by it. With the effect of cross-promotion, which would be available, I would agree with all noble Lords who have pointed out that that is easily changed.
There are two respects in which there are differences between the two channels at the moment. First, the ITC let Channel 5 get away with murder, frankly, in its first few years. Its licence should have been taken away because it breached every pledge it made when applying for the licence, with the result that we have reached the conclusion that it no longer has public service obligations. We can easily give it exactly the same public service obligations as Channel 3, and in my view we should. Secondly, at the moment it does not reach the whole of the country. That with time is changeable, in which case there is no ground for any distinction between the two.
Baroness Jay of Paddington: We have spoken often in the course of today's debates on various amendments about the example of the United States and whether or not that is relevant to the Bill. I support the amendment. I would say in that context that I wonder whether the Minister was able during the very truncated lunch-hour we had, to see the reports from Washington from yesterday, in which the Senate has moved to try to redress what it sees as the impact of the Federal Communications Commission's decision of Tuesday, about which we spoke earlier in the day. The
Federal Communications Commission has now decided to relax still further the cross-media ownership rules in the United States and all the potential outcomes, to which various noble Lords who have taken part in this most recent debate on Amendment No. 292, have referred.The Senate has now decided that it must try to introduce legislation to redress some of that in the face of the FCC's decision. I simply say to the Minister that I very much hope that as a Parliament we will not seek to do that kind of thing ourselves in a few years' time because when, as people have said, the genie is let out of the bottle by the relaxation of these cross-media rules we shall be faced with the kind of deregulation to be found in the United States. All of us have spoken about this at length and I certainly do not intend to do so again.
Echoing my noble friend who spoke about the relevance or otherwise of individual owners, we have to accept that this Bill, in the words of the Government repeated several times, is "proprietor neutral". I draw attention to the useful quotation from Mr Rupert Murdoch, to which my noble friend referred to in an earlier speech, but not in this House. When challenged on the question of regulation having an impact on the rules of ownership, he said, leaving out the expletives,
- "You can tell these politicians whatever they want to hear, but once the deal is done you don't worry about it. They are not going to chase after you later".
We are convinced that our policy of freeing Channel 5 from ownership restrictions is the right one. I shall explain our reasons for reaching that conclusion, which, I readily concede to my noble friend Lord Puttnam, include judgment in difficult decisions of this kind.
One aim of this Bill, which I believe it achieves, is to strike the right balance between the interests of viewers on the one hand and growth and investment in the broadcasting industry on the other. I believe that removing the ownership rules from Channel 5 will be in the interests of both. Channel 5 is small. Opening the market to as many investors as possible will bring in new investment, which in turn should lead to better programming for viewers. Higher standards of programming on Channel 5 will in turn cause other terrestrial channels to raise their game as well.
I cannot agree entirely with what my noble friend Lord Bragg said in this respect and neither can I see that there is anything wrong in Channel 5 growing. We hope and expect ITV to grow. What is there to fear from a strong Channel 5 competing for audiences with programmes that viewers want to see?
When we embarked on the thorough and wide-ranging consultation on media ownership that preceded the draft Bill, we made it clear that we wanted
to promote competition and investment because we believe that it will in turn lead to higher quality broadcasting for viewers. At the same time we were certain that we wanted to protect plurality and diversity. We recognise that competition law will not always safeguard those elements and in order to ensure that different viewpoints are heard in the media we need to keep some media ownership rules. But with just over 6 per cent of the audience and a reach of only 80 per cent of the country, we do not believe that Channel 5 is large enough to need protecting in the same way as ITV, yet these amendments would apply much the same rules to both channels.We believe in the importance of plurality, as I have said, but let us not forget the presence of the BBC and Channel 4. Even if Channels 3 and 5 were in the same hands there would still be three separately controlled free-to-air public service broadcasters. With an ever-expanding number of digital channels, our proposals for Channel 5 do not present any threat to plurality in the television market. Indeed, the development of the market, the growth in the number of digital channels and digital TV audience figures means that plurality is becoming integral to our broadcasting ecology.
An important safeguard of equality which applies to Channel 5, regardless of ownership, is provided by content regulation. The Bill maintains and strengthens that as Members of the Committee know. There is a quota for independent production. Channel 5 news will have to be of high quality and cover both national and international matters. Channel 5 must fulfil the quotas for original productions and 50 per cent of its content must originate in the EU.
A suitable proportion and range of Channel 5 programmes must be made outside the M25 area and a suitable proportion of its budget must be spent there too in a range of production centres. These requirements are not fixed. If the respective audience share of Channel 5 and ITV changes so that they are more or less comparable, the Bill will allow changes to the public service broadcast obligations of Channel 3 and Channel 5 licences. For example, Ofcom could alter the channel's original programme requirements or the quota for independent programmes could be changed by order of the Secretary of State.
If Channel 5's audience share—
Lord Gordon of Strathblane: I thank the Minister for giving way. I and various other Members of the Committee toyed for a while with some form of ratchet arrangement which would bring about a change only if the audience increased. But I have been successfully persuaded that that would be a bad idea, because if people know that doing better means Ofcom heaping more obligations on them, they will simply limbo-dance under whatever threshold of comfort.
Baroness Blackstone: What I am going on to say may answer my noble friend's point. If Channel 5's audience share becomes broadly equivalent to that of ITV, the Secretary of State may introduce, for example, the equivalent of nominated news provider arrangements for Channel 5 or change those
obligations for Channel 3. However, we do not think it practical to set out in advance precise audience or other targets that would in turn trigger precise new obligations. It involves too much double-guessing future market circumstances and it could produce perverse incentives if licence holders sought to remain just below the threshold.Following the ITC's review of the television programme supply market, the Bill introduces a new requirement that Ofcom should review the effect on regional independent and original production and news and current affairs programmes when Channel 5's licences change hands. Ofcom will be empowered to introduce licence variations to prevent existing standards from slipping. We have an opportunity to offer a quality boost to Channel 5 and to provide the beneficial stimulus of more competition to the other free to air channels. That will encourage higher quality across the board and the end beneficiary of the changes will be the viewers.
5.45 p.m.
Lord Puttnam: I thank all noble Lords who have spoken. They have all added some air to an important and difficult issue. My noble friend Lady Jay sent me the article on the US Senate moving to tighten limits on media ownership. I want to make the point that this has nothing to do with Mr Murdoch. I have spoken little about Mr Murdoch and it insults the intelligence and argument of those moving these amendments constantly to pin things back on Mr Murdoch. I have enormous respect for him. If I did not respect him I probably would not be nearly as concerned about what the future may bring. It has nothing to do with Mr Murdoch.
Ironically—perhaps this is the good Lord helping me—immediately below the article on the US Senate is a headline that states:
- "Berlusconi nearer to immunity after vote".
That is clearly absurd. We sit in a democratic Chamber, thank God, still in a democratic country, and this is risible. The problem is that it is happening in a nation that will in a few days' time take on the presidency of the European Union. That is essentially what Amendment No. 292 and other similar amendments are about.
It has been said more than once today that we all know what we do not want. We certainly do not want the Berlusconi-isation of British politics. I suggest that we insufficiently value what we have. A former Conservative Minister wrote to me recently expressing his concern. Interestingly, he ended his letter:
- "It seems to me that the Government is demonstrating no sense of history and is instead sleepwalking towards disaster".
I will of course withdraw the amendment today because time in my judgment will give force to the arguments that have been made from all parts of the Committee. But I say to the Minister that it will be one or the other: an enthusiastic embracing of Amendment No. 280A, which we debated at great length; or some similar amendments along the lines of this one. The Government will lose on one or the other. The only person who will look foolish if I am wrong will be me. I urge the Government to choose intelligently and thoughtfully. They have a couple of weeks to ponder the matter, but their present position is unacceptable in every respect. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
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