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The Bill has provision for public subsidy to prop up regional news. Despite the well argued plea from the noble Lord, Lord Mandelson, I believe this would be quite wrong. The situation would arise of news providers pursuing subsidy rather than their rather more important task of pursuing news. Worse still, in today's world of spin, one body funding all news carries the hideous potential danger of that body seeking to influence the news. If outdated and restrictive regulations on commercial service providers were removed promptly, the necessity for subsidy could be avoided.

While we on these Benches support the switch from analogue to digital radio, it is a sensitive area. It would be good if the Government could give some assurances of what criteria will be used to decide when will be the appropriate time for the changeover. Will the Government be guided by the criteria set out in the Digital Britain White Paper, referred to by the right reverend Prelate the Bishop of Manchester? If so, we remain unconvinced that the 2015 target date is realistic and worry that millions of listeners and hundreds of local stations will be disadvantaged.

There are many for whom the digital switchover will cause problems: the elderly or the lonely, who may have had a wireless for many years which has become almost a companion; the blind person who will not be able to work the digital radio because the instructions are on a screen that they will not be able to see. I hope that the Secretary of State can reassure the House that proper care and attention will be paid to the needs of those who will encounter difficulties with the transition.

On these Benches, we welcome the moves to a single classification for video games. We are concerned, however, that the Government have not taken this opportunity to address the loophole in video classification laws that allow violent, sexual and other harmful content to escape age verification if they are part of music or sports videos and films.

Among other comments, my noble friend Lord Bridgeman made some pertinent remarks on Clause 45 about collective licensing. What is the Minister's view on this potentially tricky subject? In the Bill, much of the devil will be in the detail and we on these Benches look forward to the Committee stage where the detail and the Government's future intentions can be examined thoroughly.

7.07 pm

The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Davies of Oldham): My Lords, I am grateful to all noble Lords who have contributed to this most interesting debate. I, too, am pleased to see my noble friend Lord Carter present, as he did so much work earlier this year on the concepts underlying the Bill. The only thing I would say in reply to his comment that the Bill team has done a good job is that they are only in the foothills-we are nowhere near the Himalayas yet. I assure him that the Bill team has to earn its medals through a great deal of work as we go through Committee, Report and Third Reading on the Bill.

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I am of course grateful that the opposition parties have indicated their broad support for the Bill. The opening speeches therefore filled me with some joy. I was grateful to the noble Lord, Lord Fowler, for his constructive approach to the issue, not only because he was the first opposition speaker but also because he chairs the important Communications Committee. We therefore always take his views on these matters with the greatest interest and seriousness. I was pleased that he emphasised one dimension which did not get much coverage in the debate-the difficulties, perhaps reaching crisis proportions, surrounding local and regional news. The noble Lord, Lord Birt, reinforced the point that the noble Lord, Lord Fowler, made, so I make no apologies for the fact that the Bill addresses this issue-it is important. There is no doubt that the wider public take a very great interest in local news, and as the opportunities and the provision contract, it is a very real loss to them. I am grateful to both the noble Lords, Lord Fowler and Lord Birt, who emphasised that dimension and said that it is an important issue that the Bill addresses.

I also want to address the issues about Ofcom. I emphasise that this Bill is not about expanding Ofcom's remit, it is about ensuring that we can take account of future investment in infrastructure and public service media content when considering Ofcom's duties to promote competition and protecting consumers. That is a proper obligation to put on Ofcom in this rapidly changing world, where it is obvious that it needs to take account of such opportunities. We are strengthening the Ofcom remit; we are not seeking to grow or extend it.

I say to the noble Baroness, Lady Buscombe, who emphasised this point, that we are expecting more from Ofcom under the Bill, but, after all, she chairs a self-regulating committee, the Press Complaints Commission, so she will recognise that as a regulator, Ofcom has much to be proud of. Ofcom is an organisation that is certainly fit to take on the new and revised responsibilities that the Bill introduces. I bring to the House's attention the fact that Ofcom has been voted the best telecoms regulator in Europe by the European Competitive Telecoms Association every year since the ECTA scorecard was introduced in 2005, so it has good credentials.

Baroness Buscombe: I am grateful to the Minister for allowing me to intervene to say that I in no way intended to criticise Ofcom or its role. I was concerned about the possibility of the unintended consequences of ensuring impartiality in the provision of online news in the new consortia, when part of the consortium may involve news provision by newspapers-newspaper websites online-which, of course, are not impartial in their provision of news. We need certainty and clarity. We need to think about that at further stages of the Bill.

Lord Davies of Oldham: My Lords, I recognise that point, and I have not the slightest doubt that it will be discussed intensively in Committee. However, we are on Second Reading and therefore discussing general principles. I sought to establish the general principles of the Bill as it concerns Ofcom. We can address some of the more detailed dimensions later in Committee.

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That is bound to be the case with the wide range of contributions that I have heard today. To answer every point would keep me here until close to midnight and would scarcely win favour. In any case, I would not be doing what a wind-up speech on Second Reading should do, which is to meet the central points and give some reassurance that the Government have thought seriously about the Bill, so that we can go to Committee and refine our arguments there. However, I am not for one moment discounting the obvious fact that there are some substantial points that have created a degree of controversy.

I thought earlier that the Government were being reassured about the Bill because of the extent to which those on the Front Benches were-although indicating their reservations about crucial parts of the Bill in the sanctions to be applied in defence of the copyright position-expressing broad support for the Bill. My noble friend Lord Whitty made sure that I was brought up short because he said that there would be formidable challenges on those terms. He was preceded by the noble Baroness, Lady Miller of Chilthorne Domer, who also expressed worries about that.

I emphasise that the sanctions are meant to be applied sensitively. I was asked whether the initial letter will be expressed in sympathetic terms. Of course we would expect that. I accept entirely what my noble friend Lord Whitty said, and the noble Baroness, Lady Miller, expressed similar sentiments. People may innocently transgress; not everybody is as knowledgeable as they should be about these matters. These companies have to write to their customers on other matters in any case. For example, if people do not pay their bill in time, the companies will write to them. We expect that the approach will be one of concern for the individual who has carried out an infringement. That does not alter the fact that the Government are convinced of the necessity for effective sanctions when the transgression is obvious, repeated and serious.

I am grateful to noble Lords who indicated the problem with a copyright law that goes back over 300 years, and has had limited updating since in a modern age when the capacity to infringe copyright is so readily available through technology. That is the nature of the problem we face. I recognise that in Committee we will have substantial debates about these issues. The Government's drafting of the Bill reflects the fact that in this crucial area we must safeguard the rights of the industry. We do that because of the point made my noble friend Lady Morris, the noble Lord, Lord Fowler, in his opening speech, the noble Lord, Lord Birt, and nearly all noble Lords who contributed to this debate about the significance of our creative industries. They paid due respect to their significant and rapidly growing role in the economy and to the fact that in certain areas they are among the fastest growing parts of the economy. Those rights must be safeguarded because, as my noble friend Lady Morris so graphically identified, the industry is fast-growing, but it is vulnerable to downloading without cost. That creates circumstances where a substantial part of the British economy-its intellectual and creative industries-is vulnerable. We went to the industry and looked for proposals on the way in which this issue could be resolved without the sanctions that we are

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suggesting in the Bill, although they build up gradually and are meant to be applied sensitively. However, we could not get agreement on that position, which is why we are obliged to legislate.

One feature that has come out from all sides of the House in this debate is the extent to which the development of the digital economy is crucial in terms of the number of people it employs. It is important in its contribution to the economy, and is also, as my noble friend Lord Maxton and other noble Lords indicated, an enhancing facility of great moment for our people. I am grateful to the noble Lord, Lord Roberts, for identifying the problems when the services are not available. People can engage in learning and information and have access news and educational opportunities and development at their command, provided we meet the points that the noble Lord, Lord Roberts, indicated. Resources are not part of the Bill. He will know that, separate from the Bill, we are determined to ensure that rural areas have access. Not only rural areas of Wales have limited access but other areas of Wales have it too. That is also true of England and Scotland; there can also be blind spots in urban areas. We intend to address the broad structure through this measure, but the noble Lord will know that we have already addressed the question of resources. I assure noble Lords that we will use these opportunities for expansion with great care.

The right reverend Prelate the Bishop of Manchester indicated the issues that arise with the digital switchover. I emphasise that we will not make the switchover for radio until there is already 90 per cent coverage in the United Kingdom and until 50 per cent of hours of radio are listened to via digital stations. We have criteria before we actually make the move. This follows on from points about the switch from analogue to digital television. I take on board his point that it is important that any changes that are made benefit people and do not shock them with a possible loss of services and extra cost. That point has to be addressed.

I reassure the noble Baroness, Lady Howe, about the important dimension which she brought to the debate-I think probably uniquely-from her background and the work that she has done in the past. Of course we are concerned about harmful content slipping under the video classification radar. Music, sports and religious videos lose their exemption from classification if they depict certain content: including sexual activity, mutilation, gross violence or a number of other practices that are likely to cause offence. If unclassified videos are on sale when they should not be, it is for the appropriate enforcement authorities to take action. Those providers must also abide by other laws, the Obscene Publications Act being one of them. However, I take on board her point that the new technology gives rise to fresh issues in this area. I know that she will pursue them in Committee, but I assure her that the Government have been concerned to address these matters. That is why the Bill is framed as it is.

The noble Lord, Lord Lucas, indicated that he hoped that those on his Front Bench would vote

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against Clause 17 in its entirety. I do not know whether he has persuaded them yet, but he may feel that he has some support there. The noble Lord, Lord Howard, may also have detected that there are rather varied opinions about enforcement, so I hope that these matters will be addressed with care in Committee. We on the government side will emphasise that Clause 17 is a very important part of the Bill. In fact, it is absolutely crucial to that issue.

I emphasise that I have very much appreciated the demonstration of commitment to and expertise on this issue, which is probably the most important of the constructive economic issues that we will address over the next few months. That is because of the potential of this industry. The Bill encompasses very big and real issues and has to address them. I do not have the slightest doubt that the digital economy is an absolutely crucial growth sector and will be in the future, and that we have to act as speedily as we can. As the noble Lord, Lord Howard, said, we are not at the forefront of provision among advanced countries. We have ground to make up, but on the basis of this Bill, we can do more than that. We can make provision which is as good as anywhere in the world, and it is crucial that we should do so. The sector is now considered to account for almost £1 for every £10 produced in the economy each year. That is how important it is, and that is why the Bill is concerned not only with enhancing the capacity for development, but also with the crucial issue of protecting certain aspects of intellectual and property rights.

I am mindful that I have not been able to address all the points that have been raised in the debate. The noble Viscount, Lord Bridgeman, raised some detailed and very important issues and I am well aware of them. They will have to be addressed in detail in Committee, and I hope that we will be able to give him the reassurances he seeks. At this stage, I do not have much proof to offer him, but we have considered these matters and I think that I have satisfactory answers to his specific points. However, this is not quite the opportunity for me to go into such detail.

The noble Viscount and other noble Lords have indicated that we will have a most interesting and challenging Committee stage. It would not be the first time that we have conducted considerations in Committee of some intensity and at some length even when on all sides of the House the Second Reading of a Bill has been greeted with acclaim. I cannot quite suggest that this Bill has been welcomed with acclaim, but I am encouraged that all noble Lords who have spoken referred to the significance of the subject and the importance of the advance of the digital economy. It is against that background that we will go into the important details and, in one or two instances, the important principles that underlie several clauses. I look forward, along with other noble Lords, to the Committee stage.

Bill read a second time and committed to a Committee of the Whole House.

House adjourned at 7.27 pm.

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