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]
THE COMMITTEE'S VIEW
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:
http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Transcript-of-Afternoon-Hearing-31-May-2012.pdf 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: http://www.official-documents.gov.uk/document/hc1213/hc07/0780/0780_iii.pdf 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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