Copyright (Rights and Remuneration of Musicians, etc.) Bill

John Whittingdale Excerpts

Friday 3rd December 2021 Commons Chamber

[Julie Elliott (Sunderland Central) (Lab)]

It is a privilege to be able to speak in this debate, which my hon. Friend the Member for Cardiff West (Kevin Brennan) has brought forward. It is a fantastic Bill and I am delighted to have this opportunity. I wish to comment on a couple of things that the right hon. Member for Maldon (Mr Whittingdale) said; it brought back great memories of my teenage years and pressing the start-stop button just to get it right. This was making us feel quite old, but then we are getting quite old. I totally accept some of the things he said about Lucian Grainge, but I also want to put on record that I believe Lucian Grainge is a US taxpayer, not a UK taxpayer, which means, disappointingly, that the huge amount of money he is being paid is not coming to our Exchequer.

[Mr Whittingdale]

I am sure the hon. Lady is right about where Lucian Grainge pays his taxes, because he did relocate to Los Angeles, but he is very much a British citizen still. When I was chairing the Select Committee, before she became a member of it, we were looking at the industry. We visited LA and Lucian Grainge made time to talk to all of us, and I think his heart remains firmly here, as of course do a lot of his artists.

[Julie Elliott]

I thank the right hon. Gentleman for that comment. Our Select Committee has looked in great detail at this issue in recent months. I do not come from a musical background—you really would not want to hear me sing—but I have always been a huge music fan. I was always told off for spending all my pocket money on music—on Smash Hits, as it was in those days, to see the lyrics, and on vinyl. One thing came out when we were looking at the impact of the pandemic on the music industry. As people could not perform live, that source of funding completely stopped for musicians and artists, and we then went on to look at streaming. Until that point, I had not given a huge amount of thought to where musicians’ and artists’ money came from—it had not really crossed my radar to such a degree. As we went through this streaming inquiry, what became apparent was the absolute unfairness of the system on the people who produce the music we love. It is not the people at the top of the music industry that this Bill would affect to any huge degree, but the people coming through—not just those starting out, but those at a middling level, who are winning awards; we have probably heard of them but they are not quite at the top of their career. They are literally struggling to pay their bills and that is not right. If this is not put right, people will not enter the music industry because they simply will not be able to afford to do so. That is of no benefit to anybody and that is the issue that needs sorting out.

It was interesting listening to just how opaque some of the dealings are between the record companies, publishers and everybody else. I innocently said it sounded a bit like a cartel—I am not saying it is a cartel, but it just sounded like one. Trying to follow where money was coming from, where it was changing hands and where it was going to was almost impossible. This idea of equitable remuneration struck me as a sensible way forward. I am not saying it is a perfect solution, as there probably is not one, but it is a sensible way forward to at least begin to put right the issue that clearly exists. As we all know in this place, the way the digital world has transformed our lives over the past 20 years, in music or in anything else, means that it is very difficult for legislation to keep pace with the changing digital world. Digital skills need updating every five months, but legislation in this area certainly has not changed every five months. I am pleased that the Government have referred some of this area to the Competition and Markets Authority, because there are definitely things that need looking at there.

I turn now to contract adjustment and the fourth part of this Bill, which deals with the 20 years to give notice on a contract. I have been a little surprised at some of the things I have heard about that in the House today. When we start any job, we get a contract of employment. In this day and age, very few people will still be party to that contract of employment after 20 years. People enter into a legal contract when they get married, but there is nothing to say that after any point, if that does not work, they cannot give notice and go through a legal process to get divorced. Why should artists tied to record labels, often at a very early stage of their career when they often do not have sufficient advice and support, be tied to a contract for more than 20 years if they do not choose to be? Just as record companies can renege on the contract after however many records have been produced, it is right that after 20 years any artist should be able to do so.

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[Geraint Davies]

There is more choice; there are more artists. Some eight out of 10 artists earn less than £200 year from streaming, which is not acceptable.

[Mr Whittingdale]

rose—

[Geraint Davies]

I will come to the right hon. Gentleman in a moment, because no doubt he will want to remind us how reasonable it is that the CEO of Universal gets £153 million a year, which is more than the entirety of sales and of streaming for all UK artists and songwriters, including people such as Ed Sheeran. To get that from streaming, as I mentioned, he would have to have 1.5 million million streams. Despite the claims that he does play a musical instrument, I doubt that he could create that. On that point, I give way.

[Mr Whittingdale]

The hon. Gentleman makes a great deal of how little an artist receives for 1 million streams, but in fact, 1 billion streams is not that much. To give an example, Mabel, one of our most successful up-and-coming artists achieved more than 4 billion streams. The income from 1 million streams is equivalent to the income from 1,000 CD sales. CDs do not cost a huge amount, which is why many artists do not receive a great deal of income, because they are not being listened to in the quantity that generates the large incomes that successful artists enjoy.

[Geraint Davies]

The point I was making is that the share that is given to up-and-coming musicians is not enough. The right hon. Gentleman may claim that 1 million streams is not very much, but I would very much enjoy a small fraction of that for this speech anywhere it was shown. It is a lot for a musician to break through that million mark. I appreciate that, in the global marketplace, there are stars who break through into the billions, but that is not the point. The point is that we in Britain should be nurturing our young people to come forward as composers, artists, performers and song writers. If they are going to have the facility to invest in their own skills, equipment and song writing, and if we are to have a situation where we have a broad diversity of people and the future music industry is not completely reliant on people with rich parents, we need to give due reward on streaming to those people who will create the joy and music of the future.

There are new opportunities—TikTok, YouTube and so on—that did not exist in the past for people to express themselves; it is not the case that someone cannot possibly achieve everything without a label and therefore they need this immense amount of money. As was briefly mentioned, the managing director of Universal does not pay British tax, but in addition, the way the finances are managed is such that some artists are paid in dollars and the Exchequer here does not see the fruits of British production, which we should enjoy as well as the artist having their due rewards.

The fact is that music is integral to Britain’s identity here and abroad, whether we go back to the Beatles, the Rolling Stones and Annie Lennox or look at what we have now in Adele, One Direction or whatever. The point has been made already about the hundreds of thousands of people in the industry and its importance for the export and tourism markets. I think we are duty bound to feed the people who are the creative engines of that success, and not to allow it to be sapped away through blood-sucking multinational corporations that hide the tax and keep the revenue and exercise market abuse and dominance in an atomised market of well-meaning people who, in their younger years, often sign contracts without the privilege of a huge legal team behind them to give them cover, so if they are fortunate in being successful, they find they are ripped off by these big labels and then are unable to go back and look at that contract again. Many of those contracts, of course, contain non-disclosure agreements, so we do not really know what is happening.

In a nutshell, we are talking about an industry of a collective of people who provide joy, happiness and exhilaration for the globe as well as Britain, and they have done so particularly during the pandemic, which has been so valuable for people’s mental health. It is important that those artists also have remuneration into the future; they should be able to plan for their retirement. I therefore agree that there should be a cut-off clause for contracts.

The Bill should progress to Committee stage. There has been a lot of debate, and that is a reason for it to be considered in Committee. It is all very well saying the issue should go to the Competition and Markets Authority. It should have gone to that authority; this is clearly an oligopolistic abuse. There is a case, of course, for artists to form themselves into a co-operative situation. It would be good if there were alternative forms of retail, through a sort of “good” music brand, so that we could move forward.

This is a first step that we should not resist because we are bombarded by the vested interests of the massive labels, which make billions of pounds while our people, who we want to nurture, are not getting a fair deal. We do not want these springs of creativity to dry up, so we need to move forward now and, in parallel with that, we need to look at the market abuse. We must continue on an iterative basis to improve the lot of up-and-coming and existing people in this great music industry of ours, hold our head up high and get back to the global No. 1 in the charts.

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[George Freeman]

As I think the record will show, I was not actually suggesting that that in itself is always enough; I was just making the point that Spotify and other streaming services have provided a platform for many artists who would not otherwise have had a chance to acquire any following. The hon. Gentleman is right that we need to ensure that revenues are flowing fairly, which is why we have launched the Competition and Markets Authority work. The Intellectual Property Office in my Department is looking at other countries and we have set up a number of taskforces, which I will describe.

Before the House decides whether to force the question whether the Bill will proceed, I want to answer the point about our commitment.

[Mr Whittingdale]

Concern has been expressed on both sides of the House about the value gap issue, which relates particularly to YouTube versus some other streaming services. In its response to the Select Committee, the CMA said that while it recognises that issue, at the moment it does not think that it should fall within the measures that it takes through the digital markets unit. Will the Government’s examination take into account concerns about the value gap and the proportion that is being taken by the platforms?

[George Freeman]

I am delighted to give that undertaking. My right hon. Friend makes an excellent point. We will be looking not only at the CMA’s specific remit on competition, markets and anti-competitive practices, but more broadly at the value chain. We need to make sure that there is a proper ecosystem; not everyone will be able to get equal remuneration, but we want to make sure that the market is working and is fair. Yes, we will be looking at that.