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Lord Dubs: My Lords, I shall speak to Amendment No. 26. In doing so, I declare an interest as chair of the Broadcasting Standards Commission; previously, I have been deputy chair of the Independent Television Commission. When accepting those posts, I had to sign a pretty tough declaration that I had no financial or other interest in any broadcasting organisation.

I should make clear that there is absolutely nothing personal in what I say. I am dealing simply with a point of principle. In so far as it may or may not affect any individuals, I cast no aspersions on anyone. I have simply tabled what I consider to be the gentlest possible amendment that I could devise to put the issue before the House.

I had a helpful discussion earlier today with Richard Hooper, who is the chair of the content board and the deputy chair of Ofcom. We discussed the issues and he was extremely helpful. I understand that Ofcom must achieve a balance between, on the one hand, including people with broadcasting experience useful to its work and, on the other hand, setting that against any excessive financial or other interest that might prejudice those individuals' functioning in Ofcom.

The question is: how easy or difficult is it to arrive at such a balance? Ofcom is an extremely powerful body. It has absolute powers over the licences and about aspects affecting broadcasters and other bodies in the telecommunications industry. Because it is so powerful, it must be entirely beyond suspicion. It was put to me that if any individuals have an interest—it would be a moderately small one—it would be appropriate for them to declare it and, furthermore, to absent themselves from meetings where a decision was being made about a broadcaster in whom they had an interest—a sort of Chinese wall practice.

I wonder whether that is sufficient. Given Ofcom's wide-ranging responsibilities, it would be pretty difficult for anyone with a financial or other interest in a broadcaster to have that interest limited to a narrow aspect of that broadcaster's work, so that they were not in difficulty with regard to other aspects of that broadcaster's work. So I suppose that Ofcom must resort to saying that the interest is relatively small and therefore does not matter.

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I did not know that it existed until this morning, but I managed to get hold of a copy of the content board members' code of conduct, which I read with interest. I shall cite a couple of paragraphs. First, under the heading of, "Public service values", paragraph 2 states:

    "Members must avoid any suspicion that their decisions might be influenced in the hope or expectation of future employment with any particular firm or organisation. Accordingly, during their term of office, content board members must not seek any consultancy contracts, directorships or other employment or acquire a direct financial interest"

in the BBC or other television or radio company, and so on.

    "If offers of employment are received from such a company, including the BBC, content board members may exceptionally accept, but only with the prior agreement of the chair of the content board . . . Accepting money from a stakeholder or regulated industry should not be permissible where this opens Ofcom to the risk of perceived bias and/or malign comment. For example, significant earnings from the regulated industries would not be acceptable."

However, it later says,

    "Similarly, a limited amount of freelance television or radio presentation may be acceptable."

Ofcom is saying that if the interest is small, that is all right; but if the interest is large, that is not all right. I understand the logic of that, but I am not totally happy about it. It would be much better if those people who make key decisions that affect broadcasting, television and radio companies or, by inference, the telecommunications world, did not have any financial interest in the work that they do by appearing on or producing for a television company. I take a fairly pure view of this, partly because it could create a public perception that might be adverse to Ofcom.

That public perception is referred to in the Ofcom board members' code of conduct, although not directly. Clause 11(9) says that Ofcom has satisfied itself that a board member will not have any financial or other interest that would be likely to affect prejudicially the carrying out by him of any of his functions as chairman or member of the content board. However, of course, if there was to be public criticism of any member's conflict of interest, that would prejudicially affect their work. Therefore, the outside view of this is important.

My amendment is mild. I wanted to expose this issue, about which there are different points of view, to some discussion. It is helpful to do so. My noble friend on the Front Bench has already answered the debate; perhaps he will do so in more detail later.

Baroness Wilcox: My Lords, I support government Amendments Nos. 23 and 24, and shall speak to Amendments Nos. 28 and 29, which would place in the Bill a guarantee that the content board will evaluate the impact of its actions on business competitiveness. The reasons for proposing this go to the heart of why Ofcom is being formed as a regulator.

One of the main considerations in the formation of Ofcom was to improve the competitive position of UK users and suppliers of electronic communication networks and services. I listened to the Minister

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present his arguments against my amendments, but I am not yet reassured. With his patience, I will present my arguments and hear his further response.

Users of electronic communications and network services—whether internet or digital television—increasingly depend for their commercial success on how well they can differentiate their products through combining textual and audio-visual content in innovative ways. While traditional content regulation has largely revolved around big issues of decency and taste, regulatory disputes in future may well focus on more technical and less dramatic issues that are more fundamental to creating dynamic and growing content markets.

The players affected might well also be different from and more diverse than just the major broadcasters of today, ranging from a company in Scotland offering a range of special malt whiskies, through an online animated chronology, to a Soho-based design business posting examples of partners' work on a website.

In this new and fast-changing environment, it would be all too easy for the content board, and the Ofcom board, to overlook some important business issue or set of factors, unless there was a conscious effort not to do so. This is simply because we are entering a new, unexplored realm, which will make our traditional compasses less effective than continuous attention to the terrain that is being traversed.

The Bill as it stands provides little protection to business users of new electronic communication networks and services. There are few checks on the impact that the new regulator could have on competitiveness. The large, traditional suppliers will be familiar to the regulators and able to make their views well known; new and perhaps specialised business suppliers and users may be overlooked in the new environment. The amendments would remedy the situation by providing a statutory guarantee that, in making its decisions, the content board will have given comprehensive and balanced consideration to business issues.

We tabled the amendments in Committee, and we were told that they would distort the relationship between Ofcom and the content board. That is certainly not our intention. We simply seek further assurances from the Minister that the content board will give full consideration to the impact on business that many of its decisions will have.

Finally, I turn to the government amendments to Clause 11, which we support. The amendments will determine the constituency of the content board, reflecting the recommendation made by the Joint Scrutiny Committee. The amendments will provide the requisite structural formality, ensuring that Ofcom's executive arm is permanently represented on the content board.

10 p.m.

Baroness Howe of Idlicote: My Lords, I shall speak to Amendment No. 30, which is in my name. Your Lordships, particularly the Minister, may recognise

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the wording of the amendment. It arose because I saw the amendment that had been tabled by the Government, which will make it possible for the consumer panel to produce an annual report. By way of parity, my amendment seeks a parallel requirement for the content board.

Although I readily agree that all of us—citizens and consumers—should be interested in the work, the priorities and the success of the consumer panel during the year in question, I am certain that there will be at least as much, if not more, interest in the work, priorities and success of the content board. Judging by my experience at the Broadcasting Standards Commission, there will be particular interest in how far it has been able to satisfy people who have complained about programmes and/or personal fairness and privacy issues. I hope that the Minister will see that I am asking only for a natural balance in what the Government have decided is a necessary requirement of the consumer panel.

Lord Brooke of Sutton Mandeville: My Lords, I shall speak briefly to Amendment No. 26, in the name of the noble Lord, Lord Dubs.

I understand the principle of Chinese walls, and I understand that there are circumstances in which they are desirable, if one seeks to achieve a particular purpose that only they can facilitate. They should not be used as a facilitator for other exceptions at the margin. I am a profound believer in the principle that Caesar's wife should be beyond suspicion—"Calpurnia pure", in shorthand.

In 1970, my family and I had a holiday in Negril Bay in Jamaica. Some of your Lordships may recall it. There was a narrow road that ran behind Negril Bay, which had not, at that stage, been developed in any way, although it has been developed since. It was the bay in which Nelson used to assemble the British fleet when crossing the Atlantic during the relevant naval period. The narrow road had, on its hinterland, a large area of marsh, which, rather in the way of Treasure Island, was recorded on the map as "The Great Morass". I shall not go into other aspects of the terrain. The River Styx crossed the road a little further down on the way to Savanna-la-Mar, which appears in one of the Ian Fleming novels.

I cannot help thinking of the circumstances—to take a single example—that led to the removal of Mr Rod Liddle from the "Today" programme because of his outside work, the appropriateness of which was then argued about endlessly in the press. That is a classic case of the great morass into which one can get. I do not seek to use the analogy in the context of the present issue, but the point about the great morass stands. "Calpurnia pure" is a much better guide.

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