Local Television Stations

Kevin Brennan Excerpts

Tuesday 25th February 2014 Westminster Hall

[Kevin Brennan (Cardiff West) (Lab)]

I associate myself with the points being made by my hon. Friend and wish to add to them. One of the problems for local television is the marketing of a new and important service. Some of the first 10 channels in Wales—such as ITV2 at channel 6 on Freeview, BBC3 at channel 7 or ITV3 at channel 10—have lots of opportunities for cross-marketing, such as by ITV1 or other ITV services, whereas local television does not have such opportunities. That is why it is crucial for local television not to have to spend lots of money on marketing because it is on an obscure channel lower down on the dial.

[Mrs Moon]

My hon. Friend made a point that I intend to come on to, but one that I hope the Minister is listening to, because this matters a great deal to us in Wales.

Wales has experienced a double injustice. Services in Scotland will also suffer from being placed on channel 26, but they will join England and Northern Ireland on Sky channel 117, while Wales has been given channel 134. That is a double reduction in prominence for Wales compared with the other nations. Will the Minister explain why? Why is Wales being singled out in that way?

The reduction in viewers will severely harm the income that local television services will receive and use to make and develop programmes, taking up the point made by my hon. Friend the Member for Cardiff West (Kevin Brennan). Made Television will be forced to allocate more of its resources to market its position on channel 26, because that is so low down the list, and that will result in reduced programme output and employment opportunities—the absolute opposite of what the Minister was trying to achieve and which we in Wales were desperate to be provided.

The responsibility for channel allocation on Freeview lies with Ofcom. Clearly, it does not have the powers to force any type of change to the position that Made in Cardiff will be placed in on Freeview. The Minister has previously spoken of his desire to update the regulations. Is he consulting with Ofcom and will he grant it the necessary powers?

The previous debate in Westminster Hall left us with a guarantee that the Minister would go away and keep us updated on a consultation to grant Ofcom those powers. He expected the consultation to take about three months, but he gave no indication of when it was likely to begin. Since then, while he has been working on the issue, has a date been set? If not, will he explain why we are still waiting for a consultation to begin?

The Made in Cardiff channel launches this summer. Unless a consultation is about to start in the next few days, no decision will be made in time for the company to do the marketing necessary before the launch of its new channel. The argument is not esoteric, but about basic business, and it could demonstrate a greater chance of success for Made in Cardiff. It is important for the Minister to address the matter as soon as possible.

This is the second Westminster Hall debate on local television in two months. The channel in Cardiff, and the one in Glasgow to which the previous debate referred, launch in the summer. How can we allow that launch to take place with the channels at a lower level on the electronic programme guide than in England and Northern Ireland? Why are the two devolved Administrations in Wales and Scotland being dealt with in a totally different manner?

Prominence on the EPG has been used to ensure that local services in England and Northern Ireland will be given the spot that they deserve, without detriment to Channel 4. The Minister also places a lot of importance on the prominence of public service broadcasters. Can we therefore agree today that action will be taken to ensure that Wales does not get a worse deal than the rest of the UK? Any consultation needed by the Minister in order to make changes to the regulations affecting Ofcom, so that it can address greater prominence for Made in Cardiff, should begin, so that the three-month period indentified for the consultation can be completed and a decision made before the marketing for Made in Cardiff starts.

I hope that the Minister understands that for us in Wales the matter is of grave importance. We have a huge reservoir of talent and we want the opportunities for people, in particular young people, to find work in the creative industries across a wide spectrum of job and skills. I hope that the Minister has some positive news for us today.

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)]

It is a great pleasure to serve under your chairmanship, Mr Walker. It is one of those moments to realise that someone I came into the House with is now of such august importance that he is chairing a Westminster Hall debate.

I am grateful to the hon. Member for Bridgend (Mrs Moon) for initiating the debate. She started with her glass half full, but by the end her glass was half empty. I hope to refill her glass, or at least to persuade her to take a slightly different perspective to the one suggested by the tone she took later in her speech. I join her in paying tribute to the many Welsh stars mentioned in her opening remarks, in particular Michael Sheen, Rob Brydon and Ruth Jones. I thank her for noticing the fact that Pinewood Studios last week signed a deal to develop in Cardiff.

It is also probably worth noting that one of the reasons for such a renaissance in television production is this Government’s decision to continue the film tax credit and to extend it to high-end television drama and animation. There has been a real renaissance in the animation industry even over the past six months since the tax credit was introduced. We hope to have some news shortly on our application to the European Commission for a tax credit for the video games industry. The Chancellor has also announced proposals to extend a tax credit to the visual effects industry, as well as to regional and touring theatres. There is therefore good news for the creative industries, which the statistics show are flourishing, and Wales—south Wales in particular—is one of the hotbeds of their development. In saying such things, I am echoing the hon. Member for Bridgend, who was setting the context for local television not only in Wales, but throughout the country.

The last time we debated local television was in connection with its prominence in Scotland, when I generously said that I regard it as a cross-party issue. I hope that I am not considered churlish, however, in pointing out that the genesis of the policy emerged under the previous Secretary of State, my right hon. Friend the Member for South West Surrey (Mr Hunt), who is now the Secretary of State for Health. His passion in opposition was to introduce local television, and his energy and drive as Secretary of State saw it come about. We are on the verge of realising his vision, albeit with support from all parties.

Last year, I went up to Grimsby to visit Estuary TV, one of the first local television stations to start broadcasting. It is working in partnership with local media and local universities. Local television therefore has the enormous opportunity to provide not only the chance of yet another media outlet for us, but so many community organisations with the kind of media coverage that they need and deserve. The local television companies also have the opportunity to forge strong partnerships with many of those community organisations.

The hon. Lady rightly referred to Made Television, which will be running the Cardiff local television service. It will serve a wide area stretching to her constituency. I gather that it is due to launch as early as this summer. Along with Bay TV, it was awarded the Mold and Swansea licences by Ofcom in January. It has set out a range of plans to develop a wide range of compelling programming, with local services broadening the choice for viewers.

That is just the tip of the iceberg: over the next three months we will see the start out of the roll-out of local TV in earnest. As well as Estuary TV, which I have already mentioned, London Live will launch shortly, as will Mustard TV in Norwich and Notts TV in Nottinghamshire. We hope that the majority of the 19 phase 1 channels will be on air by autumn.

Significant public money is being invested in the launch of local television services. In 2011, as part of the most recent licence fee settlement, which runs until March 2017, the Government made £40 million available, £25 million of which has been allocated to the development of the local TV transmission network. That work is being undertaken by Comux, which was awarded the local TV multiplex licence by Ofcom in January 2013. The remaining £15 million has been allocated for the purchase by the BBC of the local TV content that will be generated. Detailed arrangements for the distribution of that funding have now been agreed with the BBC executive. That investment will give local TV the best possible chance of establishing itself against the ever- increasing choice that viewers have, whether watching on traditional linear channels or watching catch-up and downloadable content available on other platforms.

So far, I hope that everybody’s glass remains firmly half full. The creative industries are thriving, and are supported by generous and ever-growing tax credits brought in by this Government. They will be supported by the vision of the former Secretary of State, my right hon. Friend the Member for South West Surrey, for the introduction of local television for the first time in the UK.

At this point, however, the glass becomes half empty, as we debate the prominence of local television, particularly in Wales. In her speech, the hon. Lady tried to give the impression that I was somehow saying that Wales should be duly grateful for what we are giving it. I certainly would not seek to give the impression that I thought that S4C was somehow an idiosyncrasy. What I meant was that S4C is a unique channel for Wales. It represents something like £100 million of annual investment in Welsh language programming, much of which is of an extraordinarily high quality and is exported around the world. However, that leads to difficulties in trying to find an appropriate slot for local television.

When initial bids were being sought for licences, the slot was at channel 41. As a Government, we are keen to see local television succeed, and we want to see it move up the EPG rankings where possible. As slots have become available I am delighted that local television has moved up the rankings and that Scottish and Welsh local television channels have moved from channel 41 up to channel 26. But there is a debate going on about this matter—the hon. Lady is aware of the recent debate led by the hon. Member for Linlithgow and East Falkirk (Michael Connarty) on 18 December.

It is anomalous for local TV to have a different channel slot in different parts of the UK. It means that local television is less prominent in Wales and Scotland, and causes problems for local television in developing promotional activities collectively around a single channel number. But local television was not coming into a greenfield site. We need to balance the needs of important services that already exist in Wales and Scotland and currently occupy the channel 8 slot. There is also the importance of certainty in the EPG regime for commercial broadcasters so that they can maintain their levels of investment in programming.

We made it clear in our strategy paper “Connectivity, Content and Consumers”, which we published last summer, that it is important that public service content should have prominence on TV platforms, in order to achieve our wider broadcasting objectives, but the Communications Act 2003 makes it clear that Ofcom rather than Government should determine the appropriate level of prominence. The Government’s role is to determine which PSB channels should be included in the prominence regime, and local TV was duly designated to be included in 2011.

Ofcom’s code of practice on EPGs, which was produced as a result of the 2003 Act, requires EPG providers to comply with three general principles. One is that Ofcom will

“have regard to the interests of citizens and the expectations of consumers in considering whether a particular approach to listing public service channels constitutes appropriate prominence”.

That system has hitherto broadly worked well, but it is important to recognise that it is not for Government or Ofcom to require a channel to have a specific slot on an EPG, but for the EPG providers to draw up a fair policy on how to use free slots.

[Kevin Brennan]

The problem is that, as the Minister has quite rightly said, this idea is the Government’s baby—although it has had support from all parties—and he is rather neglecting its birth in Wales and Scotland. In the past, he has promised a consultation on the matter, and in a recent answer to a written question from me, his Department said that the consultation was due to start “shortly”, but it was due to start shortly before Christmas. Before he concludes his remarks, will he tell us exactly when the consultation will begin and whether in his view the channels should ultimately be in the top 10 on Freeview at the very least?

[Mr Vaizey]

I will conclude my point and then come on to when we are planning to publish the consultation.

It is important to stress that the situation is different in England and Northern Ireland, because the channel 8 slot used there for local television is used by BBC Alba in Scotland and by Channel 4 in Wales since the usual slot for Channel 4 is occupied by S4C in Wales. That is why the channel 8 slot is not available for local television services in Scotland and Wales. When we originally put together the policy on local television, the slot available was channel 45, so there have been significant changes.

I hate to give a response to the hon. Member for Cardiff West (Kevin Brennan) that he will almost certainly regard as inadequate, but I will have to answer in the same way as I have answered him before, which is that we are due to publish the consultation shortly. We have it drafted and have had discussions with Ofcom to clarify exactly what powers it currently has so that we can make it crystal clear in the consultation what powers we seek to change. The consultation will go for Whitehall clearance shortly, so we are on the verge of publishing it. I hope that will be in the next few weeks.