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Subsection (3) of Clause 265 states that Channel 4 programming will be that which,

The new remit, however, says that, "taken as a whole", Channel Four Television Corporation must appeal to a culturally diverse society. I should be grateful if the Minister could explain how these two slightly different definitions will work in practice. Does it mean that Channel 4, the licensed channel, will continue to do this type of programming, but other output on digital channels or the internet would be released from this possibly expensive obligation?

Amendment 233ZA would ensure that, under this new remit, Channel 4 will continue to meet its existing public service obligations on its core channel. I hope that the Minister will be able to reassure the Committee that the new remit will not give licence to the downgrading of Channel 4 public service programming. Various commentators have already questioned the quality of some Channel 4 programmes. While not seeking to dictate what is and is not appropriate, it is important to remember that Channel 4 is a public service broadcaster and any further downgrading would be unacceptable. I beg to move.

5.45 pm

Lord Davies of Oldham: My Lords, I start by reassuring the noble Lord that there is no intention at all of downgrading the quality of programmes for which Channel 4 is responsible. The amendment, which deletes the phrase "taken as a whole", arguably requires all such content to appeal to the tastes and interests of a culturally diverse society. We consider the crucial question is whether Channel 4C's content viewed in the round meets the test. Requiring every single programme to meet the test is surely unduly restrictive.

For example, the new functions include a specific requirement for Channel 4C to provide,

Such content might well not appeal to older audiences. I heard what the noble Lord was suggesting and I want to disavow entirely any suggestion that this is about downgrading. It is recognising that certain programmes cannot meet the universal test when they are directed at particular audiences.

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On Amendment 233ZA, the Bill contains no provisions affecting the existing statutory requirements for the Channel 4 television service, nor will it alter any of Channel 4's licence obligations. Subsection (a) of Amendment 233ZA is therefore redundant. We are not about the businesses of changing the remit-the legislation under which Channel 4 meets its obligations.

As for subsection (b) of Amendment 233ZA, the Government recognise the concerns expressed at Second Reading largely on the Liberal Benches that the new Channel 4C functions should not lead to any dilution of public service provision on the Channel 4 television service. The noble Lord has echoed that today. I want to give reassurances on that. This legislation is not about downgrading the output of Channel 4.

Channel 4, like the other commercial public service broadcasters, is largely dependent on advertising revenue to fund its public service content. As all Members of the Committee will know, that revenue has been under significant pressure in recent years as a result of structural changes in the communications market aggravated by the economic downturn. Throughout this period, Channel 4 has continued to meet its public service obligations, though with a reduced content budget.

Baroness Bonham-Carter of Yarnbury: Is it the case that the PSB that the new Channel 4 remit is being asked to provide on the non-linear channels can be produced in-house, which goes against the spirit of the whole concept of Channel 4, which is that it is a publishing house that supports independent production companies making its PSB?

Lord Davies of Oldham: The noble Baroness is right that that is how Channel 4 operates, but I am trying to emphasise that we are not about the business of changing Channel 4's position at all. I want to meet the anxiety on the Lib Dem Benches and those of the Official Opposition. That is not our purpose. However, to require Channel 4 to ensure current levels of provision, irrespective of any future developments, is not reasonable or practical. Both Ofcom's review of public service broadcasting and the Digital Britain White Paper made clear that, if Channel 4 is to continue to play a significant public service role in the future, it will need to do so beyond the narrow confines of a single, linear television channel. I am sure that the noble Baroness is at one with the Government on that concern. In straitened circumstances, and, given the changes in technology, for the foreseeable future, Channel 4 has to have a different outlet apart from just the television channel.

The Government do not believe that the longer term interests of audiences, or of Channel 4 as an institution, are best served by seeking to freeze the manner in which their public service content is delivered. However, I emphasise that the Government expect Channel 4 to fulfill its public service obligation, taken in the round and as a whole. That is the basis of our expectation that-

Lord Puttnam: Before the Minister sits down, I offer some reassurance to the noble Baroness, Lady Bonham-Carter, and give an example to the noble Lord, Lord Howard of Rising, of why the Government are creating a useful situation.

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I declare an interest as deputy chairman of Channel 4. During the four years I have been on the board, there has never been any discussion about production being brought in-house. Whether or not the existing terms of trade will be debated and discussed over the coming years is an issue that has all sorts of ramifications. However, none of the discussions of the Channel 4 board have even suggested bringing production in-house. I want to reassure the noble Baroness on that.

I think I am being helpful in raising the broader issue-I was waiting for the Minister to raise this. One of the biggest decisions we made on the Channel 4 board was a decision to take Channel 4's PSB obligations for education online. In hindsight, it was one of the best decisions that we ever made. It was made after a lot of discussion. The truth was that audiences for Channel 4 education were diminishing. Frankly, the young people who the programmes were aimed at were increasingly not around at the time that they were available. It has been an unalloyed success. It is that type of flexibility, and that opportunity, to deliver the best possible programming to audiences when they are there, and in the means that they may have access to, that has made the channel a much more significant player in the education space than was previously the case.

Lord Davies of Oldham: My Lords, one of the most comfortable factors about speaking for the Government at the Dispatch Box is that one always knows that there will be some noble Lord who knows a great deal more about the issues than one does oneself, speaks with greater authority and is likely to be listened to by the House with even greater attention than is managed for Ministers at the Dispatch Box. I am grateful to my noble friend for illustrating that.

Lord Howard of Rising: I thank the noble Lord for his remarks and the noble Lord, Lord Puttnam, for his reassurance that there will be no downgrading.

This was a probing amendment. It was not there for any other purpose. There was just one small inconsistency by the Minister. If it is correct to include "taken as a whole" in this Bill, then presumably it should have been in the original Act and should apply to Section 265. Having pointed out that small inconsistency, I beg leave to withdraw the amendment.

Amendment 230A withdrawn.

Amendment 231

Moved by Lord Howard of Rising

231: Clause 21, page 23, leave out lines 5 to 8

Lord Howard of Rising: My Lords, again, these are probing amendments to clarify Channel 4's updated remit with regard to film. Clause 21 establishes that Channel 4 must participate in distributing films by means of electronic communications networks. Does this mean that it is compulsory for Channel 4 to invest in streaming films over the internet? I can appreciate why it should be allowed to, but is it right that this should be a compulsory requirement?

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As is widely acknowledged, Channel 4, like any other commercially funded broadcaster, has seen its revenues decline in the past year or so, meaning that it has less money to invest in content. Requiring Channel 4 to spend money on films, as set out in the Bill, is adding a further burden on top of the many others this Bill introduces. I am sure the Minister will argue that this clause simply enables Channel 4 to invest in new ways of distribution. If that is the case, it is welcome. However, I am concerned that the language, as drafted, is creating an obligation which might be difficult or impossible for Channel 4 to comply with.

As drafted, Clause 21 appears to require Channel 4 to spend money not only on programmes in which it is already investing, such as Film 4, which does indeed make high-quality British films, but in the broadcasting and distribution of films made by other people. I think that is the UK Film Council's job. Is the duplication necessary? Again, it could add a lot of expense to a depleted budget. I beg to move.

Lord Davies of Oldham: My Lords, I hope that I am not suffering under any illusion as regards this being a probing amendment to identify the position relating to C4C and Channel 4. I make the obvious point that C4C can, and already does, provide a wide range of films, on Channel 4 and on its digital channels, in particular on its dedicated film channel, Film 4, and on-demand. I think that noble Lords widely appreciate the value of a great deal of that work. Proposed new subsection 198A(2)(c) does not give C4C any new powers to broadcast or distribute films, but seeks to ensure that it includes in its services films that reflect UK culture. I am sure that I take the whole Committee with me on that objective.

Concerns are sometimes expressed that new-media ventures by the BBC and C4C risk crowding out commercial competition and stifling innovation. I leave the BBC out of the argument for the moment, as I have no wish to prolong this debate or to get hares running. It is important to bear in mind that C4C receives no public funding and competes with other providers on a commercial basis.

With regard to UK films, there is little evidence that leaving provision to the market will ensure that they receive the kind of exposure that we want to see. The C4C brand will help to raise their profile and to build the audience for UK films, which will benefit the wider industry. Again, I hope that all noble Lords share that objective. There have been glories in the British film industry in the past, but we all know the extent to which the industry has been under pressure. Channel 4 has a role to play in building up the audience for UK films. We can all recall one or two of its outstanding successes.

We believe that enshrining in statute C4C's commitment to showcasing films that reflect cultural activity in the United Kingdom on various platforms-television as well as online-is very significant. Making it one of C4C's priorities emphasises the contribution that C4C plays in this economically and culturally important sector. The Government believe it is important that C4C's duty should extend to third-party films; that is, films which C4C has not participated in making. This will ensure that C4C showcases the widest range of

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films that reflect the UK's cultural activity, and not just C4C productions. This will undoubtedly enhance the value of its contribution.

We all recognise the sheer weight of the economic, financial and, to a degree, cultural domination of the American industries when it comes to these issues. If I were addressing a French audience about the necessity of advancing French interests with regard to films, I would have nothing but universal applause. I am not seeking applause this evening, merely the recognition from the Opposition that they have probed and that the Government's position is a proper one.

6 pm

Lord Howard of Rising: I thank the Minister. As he said, it is a probing amendment. The point of it is that Channel 4 should be allowed, and not compelled, to show these films. If they are compelled, it may put too great a burden on them. I am not sure whether the Minister answered that point. Perhaps he could confirm that it is meant to be voluntary, rather than a compulsory obligation.

Lord Davies of Oldham: The noble Lord knows that Channel 4 operates under public service obligations already enshrined in legislation. I said with regard to the previous amendment that that is entirely secure. We are not changing that in any way, shape or form. We are simply indicating that we want to see part of that remit fulfilled by a support for films and products which reflect British cultural backgrounds and interests. That is the basis for us standing by the framework of the Bill as it stands.

Lord Howard of Rising: That is all very well, but the Minister has still not answered what I asked. I suggest that he reads my remarks in Hansard and looks at the Bill to see whether I am correct in the interpretation that this could be a compulsory activity by Channel 4. If he agrees with me, perhaps he might adjust it for the sake of Channel 4, if for nobody else.

Lord Davies of Oldham: What is compulsory is that Channel 4 fulfils its public service obligations, and the provisions in the Bill that we have identified here form part of those obligations. I am recoiling a little from the element of compulsion. We see Channel 4, over its history, as having fulfilled its remit with regard to public service broadcasting. It has established a reputation and had very significant successes. This issue is not about compelling Channel 4 but about guaranteeing that we are doing nothing to alter the obligation which it already fulfils and has fulfilled over the years.

Lord Howard of Rising: I am not sure I am any the wiser. Perhaps the Minister could look at what I said. In the mean time, I beg leave to withdraw the amendment.

Amendment 231 withdrawn.

Amendment 231ZA not moved.

Amendment 231A

Moved by Baroness Howe of Idlicote

231A: Clause 21, page 23, line 26, leave out "in particular" and insert "including by providing access to information and views from around the world and"

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Baroness Howe of Idlicote: My Lords, despite the growth of the internet, television remains the main source of information about the wider world for most people in the UK. The aim of this amendment, in the names of the noble Baroness, Lady Bonham-Carter of Yarnbury, and myself, is to insert a simple and uncontroversial amendment into the Bill with the aim of preserving the future of international and global content on Channel 4. I believe this will strengthen its remit and be of benefit to UK citizens.

Since its early days, Channel 4 has had a strong track record in international content across a range of genres. Some would say this is a defining feature of its output. Notable examples include: "Channel 4 News", which has a higher quotient of international stories than most other news programmes and has a tradition of widening the international news agenda; "Dispatches", Channel 4's current affairs strand which has a good record of consistently covering, and returning to, difficult international stories, especially on Iraq and Afghanistan; and "Unreported World", which covers stories from around the world which do not feature on the usual news/current affairs agenda. Some recent programmes have looked at child widows in Nepal and child rape in Liberia.

It is significant that Channel 4 has recognised that non-news and current affairs content is equally important. "True Stories", More4's award-winning documentary strand showcases the best documentaries from around the world, many of which give a real insight into the lives of people in other countries. Recent programmes include: "Afghan Star", an entertaining and insightful film about a "Pop Idol"-style contest in Afghanistan, and "The Glass House", a powerful film about women and girls in Iran who have been the victims of domestic violence or cruelty.

Channel 4, to its credit, has a knack of approaching global issues with a popular and innovative touch which enables a range of audiences to connect with stories and people from around the world. This is particularly evident in its drama output. Highlights include "Sex Traffic", a pioneering drama highlighting the issue of trafficking women for prostitution, and "Slumdog Millionaire", the multi Oscar award-winning film from Film4, which documented the lives of children in the slums of Mumbai and was one of the most popular films in British cinemas last year.

The central importance of international content was recognised by Channel 4 when it launched its Next on 4 mission statement which identified four core public purposes: to nurture new talent; to champion alternative voices and perspectives; to challenge people to see the world differently; and to inspire positive change in people's lives. No fewer than three of these purposes have been incorporated into the Digital Economy Bill. However, it is both surprising and disappointing that the original wording of the third purpose,

"To challenge people to see the world differently",

has not been kept in the Bill. No one has explained satisfactorily why this purpose has been dropped. In comparison, the BBC charter has as one of its six purposes:

"To bring the world to the UK".

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Making this ambition explicit in the charter has had a huge impact. It is true that Channel 4's new functions will also include a requirement to contribute towards the fulfilment of the public service objectives, as defined in new Section 264A of the Communications Act 2003, but we must be clear that this refers only to news and current affairs.

This short amendment will preserve the international content in other genres-drama, film, documentary, and specialist factual. While I appreciate that the current Channel 4 regime recognises that international content is a key part of its output, and I am reassured that it has no intention of cutting back on it, I fear that, if a duty towards internationalism is not specifically included in the Bill and enshrined in legislation, a future Channel 4 regime may see this as an area ripe for cuts. So I urge the Government to support this simple amendment and strengthen Channel 4's remit for the future.

Lord Davies of Oldham: My Lords, C4C is content with this amendment and so are the Government. I intend to accept it.

Amendment 231A agreed.

Amendment 232 had been withdrawn from the Marshalled List.

Amendment 232A

Moved by Baroness Bonham-Carter of Yarnbury

232A: Clause 21, page 23, line 37, at end insert-

""older children" means children between the ages of 10 and 15;"

Baroness Bonham-Carter of Yarnbury: I declare an interest as an associate of an independent production company. We on these Benches welcome the Government's clear commitment in the Bill to Channel 4. The recognition in this clause and the next of the need to update Channel 4's public service remit will help to secure its essential role as a robust competitor to the BBC.

I have tabled this probing amendment because of concern on these Benches about the situation that children's television finds itself in. A gap in the market has opened up as a result of ITV withdrawing from this area, which has meant that £30 million a year is no longer being invested in UK-made children's TV. It particularly affects those children in the age group that has left behind the likes of CBeebies, but does not want to watch repeat programmes such as "Come Dine with Me" and "Escape to the Country", which are not part of the 10 to 15 year-old diet. We know them as the "Grange Hill generation".

With only "Newsround" on CBBC delivering current affairs, there is hardly public service plurality. Ofcom, when giving evidence to the Communications Committee, on which I sit, for our recent report into the health of the British film and TV industries, said that the fall in first-run, originated children's programming is particularly acute for older school-age children. This group needs to be identified in the Bill, in order that it does not, as now, fall below the radar. I beg to move.

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