Media Plurality - Communications Committee Contents

Chapter 4: decision

180.  In the previous chapter, we consider a range of approaches to media plurality policy. Most of these leave some room for discretion about whether and how to intervene. In this chapter we analyse the evidence we received regarding different ways to allocate institutional responsibility for this discretion. Naturally, this evidence tended to focus on alternative models for the decision-making arrangements which arise in the existing transactional review, the Public Interest Test. However, the models and principles involved could equally apply to the decision-making arrangements which arise in other proposed processes such as a periodic review.

181.  Across the evidence we received we found four different ways to allocate institutional responsibility for the decisions in cases where plurality concerns arise, with any possible decisions being left to one of the following:

·  The Secretary of State;

·  The regulator (Ofcom);

·  A hybrid of the first two options; and

·  A plurality commission.

182.  We will examine each of these in turn.

The Secretary of State

183.  The current arrangements for discretionary intervention in the interests of plurality give a prominent role to the Secretary of State.[174] More specifically, the Public Interest Test process, which was introduced by the Communications Act 2003, gives the Secretary of State (originally of Business, now of Culture) three decisions to make: first, whether to issue an intervention notice citing media public interest test considerations raised by a transaction; second, having received a report from the OFT on the competition aspects of the transaction, and from Ofcom on the media public interest considerations, the Secretary of State has to decide whether to clear the transaction, refer the case for further investigation by the Competition Commission, or consider undertakings in lieu of this reference; finally, the Secretary of State, on receipt of the Competition Commission's report, decides whether to clear the transaction, do so subject to conditions or block the transaction.

184.  Some witnesses favoured leaving the decision-making powers with the Secretary of State. Professor Collins told us that,

    "We think the current arrangements, where essentially Ofcom does the analysis and the Secretary of State decides, is as good as it is likely to get …. The chain of accountability has to stop somewhere. It seems to us that with the Secretary of State is probably the least worst place."[175]

Mr Foster, whilst not espousing that view himself, explained that,

    "At issue is whether it is appropriate for the Secretary of State to retain final responsibility for taking a decision in the event of a media merger or—in future—should Ofcom find in a periodic review that plurality is at risk. Those who believe that it should be the case, argue that such decisions, which are inevitably judgmental, should be democratically accountable and not left to regulatory technocrats."[176]

185.  Whilst some witnesses favoured the Secretary of State maintaining these decision-making powers, they wanted to see the establishment of an appeals process which would take account of "matters of substance as well as process".[177]

186.  A number of witnesses were convinced that the decision-making powers should not belong to a politician. Avaaz explained that the Secretary of State should not retain this power because of the risk of politically motivated decisions, "given the natural desire for politicians to seek favourable coverage and the financial incentives for media owners to trade such coverage for decisions that allow them to grow."[178] Professor Lewis pointed out that, "No matter how impartial a Minister tries to be, there will always be an appearance of political partiality that I think is unavoidable."[179] Similarly Sir Harold Evans told us that, "It cannot be left to the Secretary of State, who is a political person, to decide on something like this without revealing the full reasons"[180] and Dr Tambini warned that it was, "problematic for elected politicians to be involved in too much discretion over media mergers, or indeed decisions about divestiture or behavioural remedies and so forth."[181] For his part, the former Secretary of State for Culture, Media and Sport, Jeremy Hunt, also told the Leveson inquiry that when forced into the position of exercising discretion himself: "even though the decision I took was totally impartial, I always felt there were going to be elements of the public that would never believe it was."[182]

The Regulator (Ofcom)

187.  For many of the witnesses who wanted the decision-making power to be taken away from the Secretary of State, the solution lay in giving this authority to Ofcom as the industry regulator. Lord Fowler expressed this directly, "I am for an independent regulator and taking it out of the hands of politicians."[183] Mr Foster likewise suggested this might be the appropriate arrangement but pointed out that, ahead of this power being delegated to Ofcom, Parliament needed to play a greater role in "setting out the parameters within which Ofcom can reach any plurality judgement."[184]

188.  Others, similarly, recommended that decision-making powers should move to Ofcom but added certain conditions. Mr Robert Beveridge, for example, sounded a warning that, "there has to be the will in the regulator, in the case of the citizen interest, to advance that rather than to choose among the varying competing clauses that are in a Bill like the Communications Act."[185] Whilst Dr Murphy supported any decisions lying with, "an independent commission that is within the umbrella of Ofcom" he emphasised the importance of ensuring that those making plurality decisions were, "representative of the people … people who have a good feel for what is happening on the ground."[186]

A hybrid

189.  In his report Sir Brian Leveson proposed a model for decision-making in the context of reviewing a transaction which provides a role for both the Secretary of State and Ofcom. On his hybrid, the Secretary of State should be required to accept the advice provided by the independent regulator or explicitly explain why he or she has chosen to reject that advice.[187] Steve Unger from Ofcom described this approach as an, "attempt to try to find compromise solutions between the role of the regulator and the role of Government."[188] Mr Foster favoured this approach which he said was, "more or less as it is now, but would "tighten up the explanation of the rationale for any decision taken by the Secretary of State."[189] The Guardian Media Group were likewise in agreement with this idea, "…as a method of ensuring that media transactions are subject to the appropriate scrutiny and the Secretary of State is not allowed to waive them through for political reasons. We would contend that this model should not be limited to reviews triggered by a transaction but should be extended to cover periodical reviews by the regulator. …This is the most effective way of ensuring that ultimate decision making is accountable to Parliament, whilst being free from political interference."[190]

190.  The Media Reform Coalition claimed that the Leveson recommendation that discretionary power remain with the Secretary of State in respect of public interest decisions over media mergers was, "in conflict with much of the evidence and testimony submitted to his Inquiry."[191] Ed Vaizey MP analysed the model suggested by the Leveson report in more favourable terms,

    "There is … a feeling that there should still be political accountability in this decision … there is that opportunity to have an ultimate political candidate … but who follows a very transparent process in terms of taking advice, that advice being made public, and where the accountable Minister differs from that advice, explaining why and being able to be examined by either a committee like this or in Parliament."[192]

A plurality commission

191.  The fourth option for decision making which was put to us was for the creation of a new body which we have called, for ease of reference, a "plurality commission." Those who recommended it believed that it would overcome the problems associated with giving this authority to either the Secretary of State or the independent regulator.

192.  Professor Picard suggested the creation of,

    "a special joint commission or council … (drawing upon existing resources and approaches in ministries and departments concerned with media, competition, culture, and consumer welfare and incorporating Parliamentary and civil society representatives), which has the authority to promulgate regulation within a scope delegated by the Parliament, to act on issues of media pluralism in its broader conceptualization, and to make recommendations of actions requiring further Parliamentary consideration."[193]

Other witnesses, however, did not see,

    "any merit in establishing another institution that would require its own research and analytical secretariat."[194]


193.  We recognise that if an appropriate basis can be found on which to ensure a role for democratic accountability, transparency and expert advice, each of these elements are potentially important features of the way in which decisions on media plurality should be made. However, it is impossible to come to a concrete conclusion about how this can be achieved and where these decision-making powers should reside without identifying the specific decisions which will need to be taken as part of a new media plurality policy. Therefore, we leave our proposal on the different ways to allocate institutional responsibility for these decisions to the following chapter, Our proposal on media plurality policy.

174   Further detail on the regulatory context to media plurality can be found in Appendix 4. Back

175   Q 54. Back

176   Robin Foster. Back

177   This Is Global. Back

178   Avaaz. Back

179   Q 378. Back

180   Q 314. Back

181   Q 9. Back

182   Leveson inquiry, transcript of afternoon hearing, 31 May 2012. Available online: Back

183   Q 156. Back

184   Robin Foster. Back

185   Q 358. Back

186   Q 378. Back

187   An inquiry into the culture, practices and ethics of the press: report [Leveson] Volume 3. Available online: Back

188   Q 405. Back

189   Q 26. Back

190   Guardian Media Group. Back

191   Media Reform Coalition. Back

192   Q 429. Back

193   Professor Picard. Back

194   Q 55 (Professor Collins). Back

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