Crime and Courts Bill [Lords]

Baroness Harman Excerpts

Monday 18th March 2013 Commons Chamber

[Maria Miller]

I am sure that the hon. Gentleman knows that such instances already arise and that they are covered by the normal laws of libel. That would continue to be the case because those organisations would not be deemed to be relevant publishers. The normal laws would therefore be in play. Hopefully, that provides him with some clarification.

In conclusion, getting the balance of incentives right is clearly important, as it was really important in the Leveson report. We are, I believe, striking a balance through these amendments that will present a tough new system of press regulation, but equally one that does not compromise the freedom of the press or investigative journalism. We are all clear that investigative journalism and freedom of the press should be given paramount importance in the process. Throughout cross-party talks, we agreed a set of proposals that will create a tough new system of self-regulation.

I believe the package put in front of us all today provides real incentives with real effect. It embodies a crucial part of Lord Justice Leveson’s proposals and part of the tough new regime for press regulation. These amendments have been put forward with cross-party support, so I commend them to the House.

[Ms Harriet Harman (Camberwell and Peckham) (Lab)]

I rise to support the Government new clauses in the group and the manuscript new clauses standing in the name of the Prime Minister, the Secretary of State, the Deputy Prime Minister and the Leader of the Opposition. The manuscript new clauses arise out of the cross-party talks, into which I thank the Secretary of State for inviting us. That explains why hon. Members have not, I am afraid, had much time to look at them. We all want to be sure that hon. Members have the opportunity to scrutinise provisions in advance, but because we worked late into the night in attempting to agree them, they have been brought before the House with inadequate notice. I offer my apologies for that.

I hope to add to the points made by the Secretary of State, with which I greatly agree. Also, because hon. Members have not had much chance to look at the manuscript amendments and consider what they mean, I shall try to explain my understanding of how they sit with the new framework set out in the royal charter.

As the Secretary of State has said, the choice Leveson made was not to impose direct regulation on newspapers as a complaints system, but to invite them instead to set up their own regulation system and to encourage subscribers to it, not only because it is a good idea as the framework is fair and reasonable, but because incentives and disincentives have been provided. That, of course, leaves the choice to them—the point of incentives and disincentives is that they incentivise and disincentivise—but encourages them to go into the new regime.

It is also crucial—this is a major change—that a new arbitration system is being set up. Over the years, people have wrung their hands about how inaccessible the courts are to people who have been defamed, while newspapers have wrung their hands about being tied up for ages with the enormous costs that can arise if some oligarch takes a newspaper to court. Importantly, therefore, arising from the Leveson report is not just a new complaints system but a new arbitration system. Media torts, defamation and privacy claims that would otherwise have gone to court will instead go into the arbitration system. The manuscript new clauses on cost will incentivise not only newspapers but individual complainants to go into an arbitration system and not straight to court. There is an incentive for a complainant who wants to bring an action against a newspaper that is a member of a regulatory body to agree to arbitration, which will be available to members of the body and which will be run inexpensively. A complainant who does not want to go to arbitration, who says “I will take my chances in court” and who then wins the case will not win the costs, and costs may be awarded against that complainant. Arbitration will involve no cost to complainants, and they will benefit from a top-rate, legally kosher procedure without having to go to court.

[Guy Opperman]

rose—

[Ms Harman]

If the hon. Gentleman is going to ask me a difficult, complicated question, I can tell him the answer. It is “The Secretary of State will respond on my behalf.” However, he is welcome to ask the question anyway.

[Guy Opperman]

I am delighted to observe that the Labour party studied the legislation in such detail before presenting it.

I should probably declare that I am a qualified mediator and arbitrator. Under the current system, people involved in arbitration can appeal against the process if they are not happy with it, and the litigation can begin anew. Would that arrangement continue, and how would an individual litigant defamed by a newspaper or any other publication bring an action, given that—contrary to what the right hon. and learned Lady has just said—the costs of arbitration are very high?

[Ms Harman]

The royal charter requires the regulator to provide for an inexpensively run arbitration service which will impose no costs on complainants. As the hon. Gentleman will know, things can happen further along the chain after arbitration has been agreed to, but the essence of arbitration is that both sides embark on it agreeing that the arbitrator will settle the issue.

I think that this will be a great step forward, because it will deal with the problem of inaccessibility. Most people who are defamed, or whose privacy has been invaded in what is termed a media tort, would never dream of being able to go to court, although many lawyers are prepared to act on the basis of conditional fee arrangements. A free-to-use arbitration service is therefore an important component of the Leveson package contained in the royal charter. It is good news for claimants, but it also means that newspapers will be well and truly incentivised not to remain outside the regulatory body. If they are not in the regulatory body and arbitration is therefore not available to those who may complain about them, it is possible that when the case goes to court, costs will be awarded against them even if they win.

[Sir Edward Garnier]

rose—

[Ms Harman]

That is how we understand that the system will work. May I invite the hon. and learned Member for Harborough (Sir Edward Garnier) to answer his question at the same time as asking it? I suspect that he thinks he knows the answer better than I do. He does not, but he probably thinks he does.

[Sir Edward Garnier]

What a charming way of allowing an intervention! I should have thought that a fellow member of the former Solicitor-Generals’ club would be a little more polite to me. I shall have to take our dispute to arbitration as soon as possible.

There is no doubt that the proposal presented by the Government, and agreed to by the Opposition, to encourage people to become members of the regulatory body and to make use of an arbitration scheme has its attractions, but I think that the right hon. and learned Lady and my right hon. Friend the Secretary of State should be careful not to be seduced into thinking that arbitration equals no expense, no time, and simplicity. The sorts of cases that go to arbitration can be just as complicated as those which go to court and the expense involved in a fully tuned-up arbitration is no less than that of a piece of litigation. So this is a jolly good idea and let us all say how wonderful it is, but let us not seduce ourselves into thinking that arbitration is some magic answer, because there will be plenty of cases where the interlocutory procedures will be far too complicated for speedy mediation or arbitration under the regulatory scheme.

[Ms Harman]

I am well aware that many arbitration cases are incredibly complex—for example, those in the construction industry. However, one thing that the recogniser established under the royal charter is charged to do is to see that the regulator, which is coming forward to seek recognition, has an inexpensive arbitration system. Obviously, it is not automatic that an arbitration system will be inexpensive—it could be very expensive—but the regulator, seeking recognition, has an opportunity to put forward a brand new system that starts off by trying to be as inexpensive as possible; it is free of cost for the complainant but there are the costs of running it. I apologise for my slightly waspish response to the hon. and learned Gentleman’s intervention; I must have been trying to get my defence in first.

That deals with the point about arbitration and costs, and I now wish to deal with the issue of exemplary damages. Obviously, the bar for those is set very high and they are rarely awarded. As hon. Members will know, they occur where the court wants not only to quantify the compensation for the claimant’s suffering and loss—mental, physical and financial—but to teach the defendant a lesson. Sometimes called punitive damages, exemplary damages are awarded to make an example; they are like a public policy intervention that gives a good bonus to the claimant, because the court wants to teach the defendant a lesson and so imposes extra damages.

New clause 21A sets the bar for exemplary damages very high, as it provides that the “defendant’s conduct” must have

“shown a deliberate or reckless disregard of an outrageous nature for the claimant’s rights”.

In addition, the conduct must have been

“such that the court should punish the defendant for it”.

We know what we are dealing with here—very extreme conduct.

[Mr John Redwood (Wokingham) (Con)]

We are being asked to legislate for exemplary damages here in this House, so does that mean that this really is a statutory system and that the right hon. and learned Lady won?

[Ms Harman]

No, because there is no statute that says, “We are setting up a system and we are passing a law to make all the newspapers be in it.” The newspapers have a choice as to whether or not they enter the system. However, the point is that we are incentivising them to enter it and disincentivising them from staying outside. They could make a judgment that they want to stay outside. They could decide that they do not want to go to arbitration and that they will take their chances with the court. They might decide that they will be so careful that they will never commit a media tort, and even if they did, that they would never get anywhere near the “outrageous” behaviour that would justify exemplary damages and so would not need to worry about that. I hope that they will not take the view. I hope they will think that, even if they are not behaving outrageously, they would want to shelter themselves from the prospect of exemplary damages. I hope that they will go into the system willingly. Exemplary damages will still be available to the courts to award against people who are in the regulator, but it is more or less a presumption that those people will not be in it. That is a major disincentive.

[Mel Stride (Central Devon) (Con)]

There is clearly a very strong disincentive to go into the scheme for those who might qualify, but there is a grey area about which publications should fall within the scope of the scheme. Would it be possible under these arrangements for those publications that might not be sure to establish whether they should or could qualify for the scheme?

[Ms Harman]

Any publication could apply to be a member of a regulator. It would find out whether it came within the purview of that regulator, as the regulator might reply saying, “Sorry, we don’t regulate you.”

Exemplary damages simply give newspapers another incentive to join the regulator. The court is left with the opportunity to award exemplary damages, only in much narrower circumstances. I hope that all the newspapers—including those that did not agree with the setting up of the Leveson inquiry, with how Lord Leveson took evidence or with his report—will propose regulators and join them now that the report has been published and all parties have agreed that we should have the royal charter and the accompanying bits of statute. I am sure that the Secretary of State, the Deputy Prime Minister and the Prime Minister will want to do everything they can to say to the press, as the Prime Minister said in today’s debate, that it is impossible for the newspapers to hold the powerful to account if they are abusing their own power. A good complaints system, which is respected and has public confidence, is a good thing in principle, so it is important that the newspapers step forward and join the regulator.

After Leveson reported, he said that the ball was now in the politicians’ court. He asked us all to work together to agree and we did. Now, the ball is in the press’s court and I hope that they will rise to that challenge.

[Mr Bacon]

I am listening to the right hon. and learned Lady with interest, although she reminds me of George Orwell’s comment about the sort of people who play with fire without knowing that fire is hot. That comment is directed at those on both Front Benches, including my right hon. Friend the Secretary of State, who is a very old friend. They have no idea what they are playing with—no idea. Does the right hon. and learned Lady not understand that one person’s outrageous behaviour is another person’s sensible and moderate behaviour? Does she not understand that after Lord Hutton issued his whitewash report, some of those who criticised it were accused of acting outrageously?

[Ms Harman]

We are not talking about any old person’s view of deliberate or reckless disregard or conduct of an outrageous nature. We are not talking about my view of what might constitute deliberate or reckless disregard or conduct of an outrageous nature, or even the view of the Secretary of State. We are talking about the judge’s view—not any old person but a judicial personage—

[Mr Bacon]

Lord Hutton was a judge.

[Ms Harman]

The hon. Gentleman needs to calm down and relax. We are giving the courts an opportunity to exercise their judgment so that when something is so outrageous that they do not think that the normal quantum of damages assessed on what has been suffered is enough, they can add to it. It is right that that should apply to media torts.

As I have said, Lord Justice Leveson urged us all to work together and we have. The Secretary of State invited us to cross-party talks and I thank Lord Wallace, who was the Liberal Democrat there. It just goes to show that one should not believe what one reads in the newspapers. I had read a lot about the Minister for Government Policy, the right hon. Member for West Dorset (Mr Letwin),in the newspapers and thought he was an absent-minded professor type who was absolutely ditsy. I had read it in the newspapers, so I thought it must be true—[Interruption.] He is now in the Chamber. I discovered that it was not at all like that, and that he was very intelligent and purposeful. He played a key part in reaching this agreement, which is very important indeed.

We were ably assisted by a number of the Culture Secretary’s Conservative colleagues. I do not want to do what my right hon. Friend the Member for Exeter (Mr Bradshaw) did and blight their reputations, but we found it incredibly helpful to be joined at our very long meetings—we had one meeting that lasted seven hours—by the hon. Members for Camborne and Redruth (George Eustice), for Stratford-on-Avon (Nadhim Zahawi), for South Swindon (Mr Buckland) and for Richmond Park (Zac Goldsmith) and the right hon. Member for Bermondsey and Old Southwark (Simon Hughes).

We tried to work on a cross-party basis because what the press have always done in the past is divide and rule. They have always sought to play one party off against another. We have to win elections, so having the press shining a light on us and saying how great we are is very tempting. It is hard to win the support of the voters. If we have the backing of the press, it seems much easier, especially if they are slagging off our opponents. That is what the press have always relied on—that we have never worked together to put a proper complaints system in place, but have allowed the press to divide us and rule.

[Sir Bob Russell]

Would the right hon. and learned Lady like to clarify that? Will she make it clear that when she refers to the press, she is referring to elements of the national press, not the local or the provincial press? They have got caught up in this, and they are not responsible.

[Ms Harman]

The Leader of the Opposition, the Prime Minister and the Deputy Prime Minister all acknowledged that successive Governments have not taken action to put in place a proper, sensible, reasonable complaints system, not because of the regional or local press, but because of the power of the national press, particularly the monopolistic power of the national press. We will have to move on to the question of monopolistic ownership, but not now because we are exhausted. However, the regional and local press have nothing to fear from having good standards and having a complaints system. One of the reasons why we worked to narrow the arbitration system was the great fears of the regional and local press. We know that they are facing very tough times so we do not want to do anything to make matters more difficult for them.

I agree with the hon. Member for South Dorset (Richard Drax), who is no longer in his place. He said there was something uncomfortable about dealing with matters behind closed doors. The royal charter is an agreement that is not subject to scrutiny. It does not go before a Committee or to the House of Lords. It drifts by in a flash, then it is up to the Privy Council. However, we cannot have it both ways. We can have Parliament crawling over legislation that applies to the press, which makes the press feel very uncomfortable and makes the Prime Minister apparently feel neuralgic. I do not have the same sensitivities, but apparently the Government do. We can avoid that through the royal charter process, in which case there is no parliamentary scrutiny. We cannot have both, and the choice has been to have a royal charter and a self-regulatory system, without parliamentary scrutiny of it, beyond the discussion that we have had.

In that respect, I shall mention one issue which is not the subject of the amendments but which comes into the question of the charter. I refer to conscience clauses for journalists. Many journalists gave evidence to Leveson and said, “We knew that we were being asked to do things that were in breach of the code and we wanted not to do them, but we feared that we would be sacked if we said, ‘We won’t do this.’” Journalists talked of being asked to do outrageous things but because it is so difficult, and fearing that if they lost their job they would never get another, they never dared speak up.Lord Justice Leveson proposed that the industry and the regulatory body should consider encouraging conscience clauses in journalists’ contracts. The relevant new clause has not been selected, so I will not mention it because that would be out of order. However, in schedule 2, on page 13 of the charter, which hon. Members have had scant opportunity to look at, there is what the Foreign Office calls a brush past. Basically, this is mentioned in paragraph 4.