Digital Economy Bill

Lord Clement-Jones Excerpts

2nd reading (Hansard): House of Lords
Tuesday 13th December 2016 Lords Chamber

[Lord Clement-Jones (LD)]

My Lords, we are rapidly getting to the point where the egg is hatching and the chicken is emerging. I refer the House to my interests as declared on the register. We have had a superbly wide-ranging debate. I thank the Minister for his introduction, and for the meetings and briefings that he and his team arranged for us, including the material that the noble Lord, Lord Stevenson, spoke about so glowingly.

The digital economy in the UK is of huge importance to our future and the Bill needs to take full account of new developments and the pace of change, which the noble Lord, Lord Puttnam, and the noble Baroness, Lady Kidron, spoke about. All that makes connectivity vital, as the noble Lord, Lord Inglewood, emphasised, and as the noble Baroness, Lady Byford, illustrated so well. We expect a full report from Las Vegas by the noble Lord, Lord Borwick.

Even in the last few years, the rate of change has of course been extraordinary. With drone development, the internet of things, driverless cars, robotics, artificial intelligence, 3D printing, cloud computing and virtual reality it is difficult for legislators to keep up, let alone to determine the skills needed in future. When two of our most digitally savvy Members of the House talk about the hollowing-out of jobs in the future, we have to sit up and take notice. I appreciate that the noble Lord, Lord Holmes, was rather more optimistic but we have to address the issues raised by the fourth industrial revolution, which were so graphically described during the debate.

Despite a fair degree of debate in the Commons, particularly in the Public Bill Committee and on Report, many matters in the Bill are unresolved, as we have heard in today’s debate. There was a very strong measure of agreement on this, given which, on these Benches our welcome to the Bill can only be conditional and dependent on the information and assurances given by Ministers, and the amendments to be made during its passage. For instance, while we welcome action to ensure that superfast broadband will be available within a short time to all UK households—driving the final mile, as discussed by the noble Earl, Lord Lytton—we are not yet convinced that a USO as opposed to vouchers is the way to do it.

Even if were persuaded of the merits of a USO, we are not convinced that setting a modest 10 megabits per second will be adequate for future increases in demand for speeds and capacity. As we have heard throughout the debate, why should there not be a higher rate of 24 megabits per second if nearly 90% of households will have that next year? My noble friend Lord Fox described this as a very unambitious goal, as did the noble Lord, Lord Aberdare, while the noble Lord, Lord Holmes, described the Bill as generally lacking in ambition. I thought that the noble Lord, Lord Mitchell, made the most futuristic speech in the debate; I rather liked his phrase “Gigabits not megabits”, which should be the slogan as we go forward.

We on these Benches also want a requirement for a minimum upload to be included, and to have standards of latency, resilience, reliability, consistency and contention also spelt out. They are every bit as important as speed. We will question the Government further on the review process for the USO. What will the criteria for change be? When will the first review take place and what will the new funding model be? Will there be an open tendering process for the delivery of the universal service obligation? Will Openreach be the main instrument of rollout again? Despite the advocacy of the noble Lord, Lord Young, we are not convinced that Openreach, even as a separate legal entity within BT, is the right instrument, and I know that that view is shared by the noble Baroness, Lady Byford, the noble Lord, Lord Mitchell, and my noble friend Lord Fox. They made a strong case for structural separation. We are definitely not convinced that government investment is sufficient. However, I am reassured by the recent speech of Sharon White at the Institute for Government that full structural separation of Openreach could become a reality if the proposed level of separation is demonstrated to be inadequate.

Again, although we have a high regard for Ofcom and the way it has performed its duties since formation, we want to be extremely careful in Clause 74 that we are not handing it far greater power with less corresponding accountability than its European counterparts under Article 4.1 of the European framework directive or indeed other UK regulators. That was also mentioned by my noble friend Lord Fox, and the noble Lords, Lord Aberdare and Lord Macdonald. We appreciate the consumer arguments put forward by Which? and that opinion is divided, but the Government are going to need to give chapter and verse, real evidence of why we should make such a radical change to the appeals process from a merits approach all the way down to a judicial review test.

Above all, our aim on these Benches is to ensure that in a holistic way we bear down on digital exclusion in the most effective way. Of course we welcome Clause 87, as far as it goes, but it is not sufficient and we need more information about the funding aspect. As my noble friend Lady Janke asked, do the Government accept the arguments for a social tariff for broadband? Many have argued that it should be equivalent to that in other forms of telephony.

On the other hand, when it comes to the new electronic communications code dealing with phone and internet infrastructure, we broadly welcome the new version set out in Schedule 1. We will, however, want the Minister to explain, as my noble friend Lord Foster pointed out, where we have got to on the definition of electronic communications apparatus because of its importance to the various operators. We need to ensure that investment incentives for independent and wholesale infrastructure are maintained, as the noble Lords, Lord Gordon and Lord Aberdare, pointed out, so that there cannot be free piggybacking on the infrastructure investment of others. This is vital if we are to get the infrastructure we need for 5G in the future.

Having campaigned for some years on the subject, we welcome the higher penalties for online piracy and the proposal to allow web-link marking for design rights. I welcome the conversion of the noble Lord, Lord Whitty, to better protection from online piracy. We will however question why the Government are not using the Bill to outlaw the supply of devices designed to infringe copyright, such as IPTV streaming boxes, which are a growing threat to pay-TV services. I thought the noble Baroness, Lady Kidron, made a very interesting point about better protection for user content.

Depending on progress on a voluntary agreement with search engines to ensure that sites infringing copyright are not listed, we will also want to explore the benefit of giving a power to the Secretary of State to require search engines to adopt a code of practice. We welcome the new powers for Ofcom as regards gaining provider-led switching provisions. I argued for these rights to be included as long ago as the Enterprise and Regulatory Reform Act, but should these provisions not be wider and include so-called quad-play bundled services which include pay TV? Similarly as regards Section 73 of the Copyright, Designs and Patents Act 1988, which I have long argued should be repealed, we will want to hear assurances from the Government—these were requested by the noble Viscount, Lord Colville, and the noble Lords, Lord Grade, Lord Macdonald and Lord Gordon—that commercial PBS channels will be able to negotiate retransmission fees as a result and that the repeal will take place without delay. We will also want to know from ITV that any fees will go into new production—children’s programming, for instance, as mentioned by my noble friend Lady Benjamin.

As regards Part 3 of the Bill, some very fine speeches were made, including by the right reverend Prelate the Bishop of Chester. I pay tribute of course to the long campaigning of my noble friend Lady Benjamin and the noble Baroness, Lady Howe, on these issues. My noble friend Lord Storey was also very eloquent on the subject, and I was very taken by the noble Baroness, Lady Kidron, saying that pornography is a really bad way of learning about sex. That will stay with us for some period.

We strongly share the desire of all parties to ensure that children and young people are not able to access pornography online, but we are concerned that the current requirement for a verification process does not explicitly provide for proper protection of people’s personal data. As my right honourable friend Alistair Carmichael said in the Commons:

“My real concerns centre on the holding of the data. As I put it to the Minister when he was at the Dispatch Box, there are no provisions in the Bill to secure the privacy and anonymity of those using these sites. He said that the data will be held in accordance with the Data Protection Act, but as we saw in the Ashley Madison leaks, that was of no great assistance”.—[Official Report, Commons, 28/11/16; col. 1304.]

We believe that the answer is to make sure that the type of verification required for pornography sites is itself specified in the Bill, so that personal data acquired by any verification process have to be held in an anonymised form. I did not agree with everything that the noble Earl, Lord Erroll, said in his contribution today, but I thank him for some of the technical advice he gave to enable us to demonstrate that that anonymity in terms of verification and authentication is perfectly feasible. The Government Digital Service itself has developed Verify, and there is the Certificate Transparency, or CT, system which uses distributed ledger technology to mitigate this problem. Other verification systems are becoming available, such as Yoti and VeriMe, that would meet the objections of many to this clause, which we all concede has the best of intentions.

My noble friends can of course see the merit of site-blocking being available as a last resort—although I hope this would be after Clause 22 has been invoked, and the noble Lord, Lord Morrow, made some very interesting points about the efficacy of that clause. However, it should be a last resort, at the instigation of the age verification regulator, the BBFC, if pornography sites do not provide adequate age verification—which should be anonymised, as I have argued. But it is a different matter altogether, as the current Clause 23 makes it, for the regulator to act as a censor of “prohibited material’' on internet pornography sites in general. This goes well beyond the harm test in the Video Recordings Act 1984 and includes material covered by the CPS guidance on the Obscene Publications Act. To us, that is disproportionate, and has no relevance to access by young people and verification.

We welcome the promised government amendment to confirm that default parental filtering does not fall foul of the EU’s open access regulation, although I thought the noble Baroness, Lady Howe, raised some extremely interesting points on that. It is also of huge importance and central to protecting children in this context—this was raised by the noble Lords, Lord Stevenson and Lord Borwick, and by the right reverend Prelate—that we introduce compulsory, age-related, sex and relationship education in our schools.

Moving on to other parts of the Bill, we welcome the fact that the Bill updates the regulation of the BBC by making Ofcom responsible for the regulation of all BBC activities, although as we have expressed on previous occasions we have great concern about Schedule 1 to the framework agreement. My noble friend Lord Lester was extremely eloquent about the issues involving the independence of the BBC, and quite a number of noble Lords lined up behind him in support, including the noble Viscount, Lord Colville, and the noble Lord, Lord Inglewood. It was interesting that the noble Lord, Lord Grade, did not support that. I felt he was perhaps coming on a little like Anthony Joshua, so we have some quite interesting debates coming in the future.

In Part 5, we welcome increased digital government provision but we have a number of concerns. I will not adumbrate them here but we are particularly concerned about personal healthcare information. We think there are opportunities, and the noble Lord, Lord Rowe-Beddoe, had an interesting description of the need for better statistics, but there is some tension between better statistics and personal data confidentiality and we need to resolve that.

The former Secretary of State, John Whittingdale, aptly described the Bill as a Christmas tree at Second Reading in the Commons. That has been echoed today, although I think by now we have a forest of conifers, which may be the new epithet that we are going to have to use. There are quite a number of additional matters that we will want to see included, such as the listed event amendments. We want to see EPG prominence tackled, along with the whole issue of bots with regard to ticket purchase. I see that Congress has just passed a BOTS Act that will soon be signed by President Obama. We want to see a level playing field on spectrum, the extension of remote e-lending and of course improved transparency of the reporting of royalties to creators in a variety of creative industries.

For some time we have been promised a new communications Bill, a new digital Bill, but I am afraid this is a bit of a disappointment; as the noble Lord, Lord Mitchell, pointed out, it does not really deal with all the challenges of the future. It may deal with the here and now but there is nothing really future-facing in it. For instance, in the report Distributed Ledger Technology: Beyond Block Chain the Government’s own scientific adviser says:

“Government needs to consider how to put in place a regulatory framework for distributed ledger technology”,

but that is absent from the Bill.

I hope my noble friends and I have given the House a comprehensive picture of what my party supports in this Bill but also of where the Bill is deficient. We look forward to the Minister’s reply and to the Committee in the new year.