Intellectual Property (Hargreaves Report)

Debate between Ian C. Lucas and Mike Weatherley

Thursday 7th July 2011 Westminster Hall

[Mike Weatherley]

The right hon. Gentleman is exactly right. I think that the charge is equivalent to $10 a month, the payment of which allows unlimited downloads. Zero cents of that $10 goes back to the publishers.

As we come out of the recession, there is much talk of rebalancing the economy. Where will the growth come from? We cannot compete on labour costs and we do not want to. Our strength is in pharmaceuticals, high-end engineering, brands, bioscience and, of course, the creative industries. Our education publishers are No. l in the world. Our music industry is at No. 2. Our games industry used to be at No. 3—the position is under threat as other countries adapt and offer incentive packages that we are not matching. Surely we should be as proud of our creative industries and their podium positions as we hope to be of our athletes next summer.

To be fair to the present Government, the Hargreaves review is their first review of IP. I should also point out that there is a duty on those in the creative industries to adapt their business models far more quickly than they have done in the past. That includes reduced pricing models for the prime product and a changed emphasis on secondary income streams, such as live music and merchandising.

The Government’s response to the Hargreaves report is a tailor-made opportunity to celebrate our creative industries, and to confirm that we are open for IP business on a global scale. Will the Minister reassure banks in the UK that we are the best place in the world to invest in IP businesses? Will he confirm to creative businesses in this country that their assets will be protected by legislation? Will he encourage new talent with the message that people’s rights in respect of what they have created will not be reduced by exemptions and undermined by unnecessary regulation?

Let me turn to the Hargreaves report. It is better than I was expecting; I know that many other hon. Members have said the same. I have to admit that my heart sank when I met Professor Hargreaves and he hinted to me that he wanted to introduce US-style fair use here. His argument was that our IP laws were preventing internet companies from launching, yet I remember many search engines and social networks starting here. Some, such as Mumsnet and Friends Reunited, have been extraordinarily successful. They were not held back by our IP laws; they just did not have access to the same funding as Google and other silicon valley giants. Introducing fair use here would help only the likes of Google—established players with deep pockets that can fund the legal test cases that are such a feature of the US system. It was therefore with some relief that I read in the Hargreaves report that he rejected fair use for the UK. That is a sensible recommendation, and I urge the Minister to endorse it.

However, the report goes on to recommend a range of new exemptions. Let us be clear about what an exemption means for a creator. On the one hand, with our 300-year-old copyright tradition, we say that an author owns his work when he writes something. It is his property; he created it, and it is his. On the other hand, with an exemption, we say that he does not own his work any more in certain circumstances. Of course, there are situations in which the public interest must outweigh a property right, but we should be wary of taking away someone’s property, especially their own creation.

One example involves text and data mining. No case is made in the report for a text and data mining exemption. Such mining is simply described as making it easier to crawl the internet for material. Surely that is what Google and other search engines do on a commercial basis. Do we really need an exemption to make Google’s life easier? Should it not be obtaining licences if it wants to use other people’s material?

Parody, as we have heard, is another example. Parody is almost the hallmark of British comedy. It can hardly be argued that there is a shortage of parody in the UK. However, the Hargreaves report seems to think that there is a problem. The report concludes, with seemingly no evidence, that we should have a parody exemption, but should someone be allowed to take someone else’s work just because they are making fun of it? I do not see how parody justifies removing a creator’s basic rights in their work. Then there is research. Of course there is value in building on the work of others, but does that mean that the original researcher should get nothing for their work? I strongly urge the Minister to reject those recommendations in the report. This goes to the heart of copyright as a property right. Arguably, something that someone has created is even more precious than property. Our legislation gives creators ownership of their work. We should not take those rights away without good reason.

There are two areas where there is justification for an exemption, and that is broadly accepted by creators. The first is archiving. We have some unique collections of film and music in this country; indeed, I understand that film originated in my constituency of Hove. The British Library, for example, has the national sound archive, with millions of recordings going back to the birth of the gramophone, mostly donated over the years by record companies. Making digital copies is an obvious way of preserving those for future generations. When the Government consulted on an archive exemption three years ago, industry backed it. We should implement it now.

[Mr Christopher Chope in the Chair]

The second area is format shifting. That is copying CDs to MP3s, or DVDs to an iPhone or similar—something that millions of people do, despite its being illegal at the moment. Having just parted with cash for both a CD and their new MP3 player, consumers rightly expect to be able to copy music and films across without paying any extra, as they in effect paid for that in the purchase price.

The sticking point was whether musicians should get some recompense for that format shift. In the rest of Europe, that takes the form of a levy on copying devices. I do not like the idea of a levy. It is a blunt instrument that does not necessarily follow the market. Surely some form of licence could be allowed, provided that the material is solely for the private use of the purchaser. If it turns out to be impractical to stop internet file sharing, we could revisit the idea of a levy on equipment, as that would get some revenue to the rights holders and is attractive for its ease of use. In the meantime, I urge the Government to reject the idea of a levy on equipment and to allow personal-use format shifting, provided that an original licence has been purchased—in most cases, that would simply be someone paying for the CD for their own personal use.

On exceptions, the Hargreaves report gets some things right, but not others. The challenge for Government will be working out what to embrace and what to ditch.

[Ian Lucas (Wrexham) (Lab)]

I would like clarification. Is the hon. Gentleman saying that the licence would be bought at the same time as the CD, as part of the price?

[Mike Weatherley]

I thank the hon. Gentleman for his intervention. Yes, my belief is that once someone has bought a CD, they should be able to shift the music to another format to listen to it in their own home, for their own private use; that becomes an infringement only if the material is used for other purposes. The industry got that wrong years ago. It is making illegal users out of millions of people in this country. They tend to ignore the law on copyright protection because they see it as a ridiculous law, and once people see something as a ridiculous law, they throw away other laws. We should allow format shifting for personal, private use once someone has bought a full legal copy.

I was saying that the Hargreaves report got some things right, but not others, and that the challenge for Government would be working out what to embrace and what to ditch. The same is true of the idea of a digital copyright exchange and the recommendations on licensing. The report identifies licensing as underpinning creative businesses. Indeed, licensing is now central to almost every business model, whether we are talking about a direct licence from a rights holder for a specific repertoire, or a collective licence covering an entire catalogue. The report recommends that the collective licensing bodies adopt a code of practice to facilitate efficient markets. That is a good suggestion, but does it need legislation and, if so, how intrusive should it be? The British Copyright Council is already producing a template code, and all the collective licensing bodies in the UK have agreed to sign up to it. If the industry is adopting good practice voluntarily, we do not need more regulation.

Perhaps the most high-profile recommendation in the report is the one for a digital copyright exchange. In essence, that is a good idea. Indeed, many parts of the industry are already developing databases. Phonographic Performance Ltd, for example, has a database of 5 million recordings, and the database includes record company ownership and performer line-up. That is essential for its licences with the BBC and others, so that the broadcasters know what is in their licence and the right musicians can be paid. Book, newspaper and music publishers, along with photographers and others, are developing similar facilities. There may even be a role for Government in co-ordinating those efforts and encouraging greater co-operation between databases.

However, the Hargreaves report certainly goes a step too far. It recommends that the digital copyright exchange become a licensing platform, with flat-rate pricing available at the click of a mouse. Far from encouraging growth, that is anti-market. It is extraordinary that a review about growth should recommend a trading platform where prices are static and there is no room for negotiation. How on earth could any rights holder be expected to set a price in advance for a totally new service that at the time exists only in the mind of the creative entrepreneur? That is a recipe for stagnation.

As if that was not enough, the report also proposes introducing penalties for rights holders who do not participate in the digital copyright exchange. Such wrongdoers would be denied access to their rights under the Digital Economy Act 2010, creating a two-tier system for copyright, and that must be resisted. Effectively, it is compulsory registration by the back door, and we should not allow it. One of the great strengths of copyright is its flexibility, and the fact that it is available to all creators, big and small. The principle of not requiring formal registration to enjoy copyright is enshrined in international treaties. We should uphold that principle, not undermine it.

We then come to the report’s suggestion that Government should appoint a digital champion to sort everything out. This is perhaps the most extraordinary of the report’s recommendations. The review rightly concludes that, if it is to work, the digital copyright exchange must be industry-led and must respond to the business needs of the creative sector. It then recommends that Government appoint a tsar to direct that industry initiative. “Industry-led” means led by the industry, not by a digital champion appointed by the Government. Will the Minister reject the idea of a digital champion, and allow the digital copyright exchange to be led by the industry from the start—or at least by a digital champion who is advisory rather than dictatorial?

In conclusion, I urge the Minister to be selective in his response to the Hargreaves report. Will he say yes to protecting our creative industries and the property owned by the creators? Will he say yes to archiving, private format shifting and some form of central rights database? Will he say no to the exemption of text and data mining for research and of parody, and will he be selective in exemptions linked to the national interest? Will he say no to fair use and to a centralised pricing model in the central rights database? Such confirmations and rejections would confirm this country’s commitment to ensuring that IP gives world-class support to business, and to the talent that drives it.

Community Policing

Debate between Ian C. Lucas and Mike Weatherley

Tuesday 6th July 2010 Westminster Hall

[Ian Lucas]

If I was not aware of that before, I certainly am now. My hon. Friend is always full of imaginative ways of intervening and promoting his constituency, as he has just done.

I have set out the excellent work that has been done, but my concern is about the future. The extension of community policing has taken place against a backcloth of increased investment in our police service, including an increase in the number of police officers, the introduction of community support officers, and Home Office support for the street pastors scheme. Unfortunately, under the Tory-Lib Dem Government, that support has already been reduced.

Today the newspapers in north Wales carry details of an interview with the local chief constable, who talked of the £1.4 million reduction in this year’s budget, which has already happened for north Wales. He says that

“the suggestion from David Cameron is that this could be increased to 40 per cent over the next four years. This would mean cuts of £30 million coming out of our budget.”

He goes on:

“Eighty-two per cent of our money is spent on staff so even if we stopped using computers and walked everywhere we would have to cut staff numbers.”

Those staff are the community beat managers and community support officers that I mentioned. Those individuals have achieved the progress in policing and in making safe the communities that I represent over the past decade. I am, therefore, extremely concerned to hear my chief constable saying that he cannot deal with the proposed reductions in expenditure without getting rid of some of that staffing.

That is a major concern, but not just from me—I am already receiving representations from councillors in my constituency. My good colleague Councillor Michael Williams of Gwersyllt has told me that good work in combating antisocial behaviour in his ward is under threat. He tells me that already community beat managers are not being replaced. He represents a community of up to 10,500 people who now have only one community beat manager, whereas previously they had two.

[Mike Weatherley (Hove) (Con)]

Would the hon. Gentleman agree that, if we reduce some bureaucracy, we might get more time on the beat? The expenditure might not, necessarily, have the impact he suggests.

[Ian Lucas]

The hon. Gentleman makes what is always an important point: no one wants to create bureaucracy. However, the chief constable tells me that he will have to let staff go because of the proposals and that is why I quoted him directly. Of course we want to create less bureaucracy—no one enjoys bureaucracy—but we need to take the professional opinions of chief officers seriously or we will threaten the way in which policing has developed so successfully. We do not want to undermine what is, essentially, a success story.

What I would like from the Minister is an assurance that the Government believe in community policing. A statement to that effect, at the outset, would be useful. The budget reductions floated at the present time—whether 25% or 40%, or even if they are less than 25%—will clearly have a major impact. That chief constable’s statistic about more than 80% of his budget being spent on staffing is very relevant. How does the Minister see the budget being reduced to the extent discussed by the Government without a reduction in the number of police officers? Also, what is the Government’s view of the future of community support officers? Do the Government anticipate a reduction in the number of CSOs? If so, who will be responsible for dealing with them and who will make the decision to make them redundant, if that is to happen?

We have heard that there has been major progress in policing in north Wales. Through the Crime and Disorder Act 1998 and community safety partnerships, we have established effective structures that have led to a diminution and lessening of crime in the communities that we represent. A major impact has been not just on the commission of crime but on the social atmosphere in an area.

One of the best ways of creating cost in the criminal justice system is to allow criminality to rise. A rise in crime means a strain on prison budgets, effectively increasing the cost of crime. More pressure will be put on Government budgets if the successful anti-crime strategy pursued in the past is jettisoned.

I therefore appeal to the right hon. Gentleman, the Minister, who is a sensible man and who knows a good success story when he sees one, to fight his corner against the Treasury, and to say to them, “Let’s look at the effective way of reducing cost in the criminal justice system.” The most effective way, I venture, is to reduce crime in the first place—something achieved under the Labour Government since 1997. The reduction of crime has meant that fewer people are causing more cost to the system. Effectively, progress in the creation of community policing—one of the great success stories of the last Labour Government—should be continued, so that the people that I represent feel safe in their communities and so that we do not go back to the bad old days when no one knew who the local constable was and no one knew where to go when crime was committed.