Deregulation Bill

Lord Dubs Excerpts

Tuesday 11th November 2014 Grand Committee

[Lord Deben]

My Lords, I believe that my noble friend will realise that my earlier intervention had a degree of mischievousness to it, as I had come in specifically to address this particular amendment. I do so for three reasons. First, sometimes we on this side of the House have been disappointed with the Deregulation Bill, because quite a number of things have been deregulated that really do not seem to have been very important. There has been a tendency to add up the number of things that we have got rid of. On one occasion my noble friend had to justify the removal of a statutory right from someone who was still able to exercise it voluntarily—not, I thought, one of the biggest things that we have ever done in government. I am particularly concerned that when we have an opportunity to make a change that is really worth while, we should do it.

The second reason for my concern is that sometimes one of the ways you can judge the validity of a proposition is to see who opposes it. For much of the time in my period in the House of Commons, there were one or two Members on my own side from whom, when I knew they were in favour of something, I was almost automatically on the other side. I believe that that is true of both sides of the House: we all have bellwethers, who are always extremely useful if we have not quite grasped what is behind the issue. My noble friend’s characterisation of the dual position of Fox News is one that deserves considerable investigation. The reason that people do not want that is because they make money out of it. We therefore have to ask ourselves some very simple questions. Should they make money out of it? Is it in the public interest that they make money out of it? Is it money that could be better spent somewhere else?

That brings me to my third point. Torn aside from all the history, the phrases, the arguments and the discussions, this is a simple matter. We once had a different system, and we had different rules to deal with that system. The system has changed but the rules have not. Would it not be sensible to change the rules now that the system has changed? If there is a big reason for deregulation, and there are several, the biggest of all is that many Administrations suffer from the inability to get rid of good things when they become bad. You can go round the whole Continent of Europe and find all sorts of bits of regulation that were frightfully good at the time when they were put forward but which now get in the way of trade, make it more difficult for people to innovate, and distort the market.

I am not always known for my upholding of the free and unfettered market, mainly because most markets are neither free nor unfettered. However, I wish to say that here there is an obvious way in which a Conservative-led coalition can make the market freer. In those circumstances, seeing as it appears to have the support of the Opposition as well as that of its coalition partners, there is not much reason for saying that this is not a sensible amendment. I therefore hope that my noble friend will find it possible, if not to give way on this occasion, at least to indicate that he has every intention of giving way at a more amenable moment, but before the Bill passes.

[Lord Dubs (Lab)]

My Lords, I have enjoyed listening to the speeches on the amendment moved by the noble Lord, Lord Grade, who gave a very powerful indictment of the present situation. I do not know what the Front Benches will say to this.

When I was first in the Commons in 1979, a small Bill or measure was working its way through—I cannot remember what it was—and both the Front Benches were passionately in favour of it. I ended up in the Lobby, voting against it with friends, who said, “When both the Front Benches agree, we’d better all be careful”. I do not know about that. However, when Governments are in difficulty, our brilliant officials put forward a number of ideas or thoughts. One is to say, “Accept the principle, but not now”. That is pretty much what Governments do in order not to have to do anything. The other thing they could say to get out of it is, “Well, we’re going to have a review”, because that puts it all into the long grass. Or they can say, “This measure has other implications, and we’ve got to think about those”. Those are all stock excuses that the civil servants, in their brilliant and imaginative ingenuity, pull off the shelf and say, “Here, Minister; these will get you out of the mess you’re in”.

The Minister is in a bit of a mess, because people with far more experience in the industry than me have all united to condemn this anomaly, which, frankly, in logical terms, cannot be defended. I bow to the experience of many Members of this Committee who have far more media experience than I have. I served for a brief time on the ITC and for a slightly longer time on the Broadcasting Standards Commission, but we on the commission certainly did not deal with matters of this sort, so I accept that noble Lords here have far more experience in this than I have.

I suspect that the Minister will say that he accepts the principle, and then there will be a big “But”; I look forward to hearing that. However, we are in a ridiculous position if he does not accept it anyway. We have a brilliant creative industry in Britain; our television creativity is second to none. We are allowing it to be weakened by this anomaly, which dates back many years as a way of protecting a small and up-and-coming cable industry. The time has come to say, “No, there’s no point in this”.

We have to support our creative industries and, in terms of competition, have at least a semblance of a level playing field, which we simply do not have at the moment. We are allowing the public service broadcasters to subsidise the pay TV platforms, and surely that is not right in any approach to competition policy. In a normal situation, one would say that these things have to be negotiated freely between the parties and, where they cannot be negotiated freely because of anomalies, we should get rid of the anomalies. Good heavens, I am in the Labour Party and I am arguing for competition—what is going on here? What we do not want is this partly hidden subsidy.

Of course, as has been said, Virgin Media and Sky are willing to enter into such a process for the channels not covered by Section 73—in other words, ITV2, ITV3 and ITV4. It does not make sense even in those terms, any more than it makes sense in terms of what News Corporation is doing in the United States. There are many ridiculous defences of the present position and they just do not stand up at all. I would argue that Section 73 has outlived its useful life. It defies logic, it defies fairness, it defies competition policy and it might defy even the ingenuity of the Government to defend it.

[Lord Stevenson of Balmacara]

My Lords, this has been a very interesting and useful debate, again, on this topic. I say “again” because although when the noble Lord, Lord Grade, introduced the topic he said that he could not think of a more perfect vehicle for this amendment, he might like to reflect on the fact that we have had this argument before on four other occasions—this is the fifth time this issue has come up—and every other vehicle has also been seen as a perfect vehicle for this amendment. I rather suspect, although I would not wish to impugn any of his motives, that there are people on a mission to do a particular thing who are looking for any vehicle that comes along to hook their amendment to. That is not necessarily wrong, though; this is a complicated topic.

Section 73 is part of a very complex web of regulations that provides equilibrium in the UK broadcast market—at least it has done for some 28 years, as we have heard. Its focus is on consumers, who have of course already paid for public service broadcasting content through the licence fee or through indirect taxation, paying for advertising costs on the goods that they purchase. It is a question of whether or not the arrangements that were set up in 1988, not on a temporary basis, are still relevant today. It is important that among all the various vested interests that we have heard about today, the consumer interest is kept at the forefront of our thinking.

Obviously, Section 73 is an old clause. It was created when the cable industry was in its infancy. It is also true, as everyone has said, that the industry has changed a lot since then. It is interesting, though, that the reason why this suddenly became prominent in people’s thinking, and why it has been raised in three successive Bills that I have been involved in, is because of a case involving catch-up television that is still going through the courts and therefore perhaps should not be excessively commented on. The point is that the judgment in the first instance will have raised legitimate concerns about the use of Section 73 as a defence for retransmission of free-to-air channels online. That, of course, is radically different from any cable commitments or any negotiations that may take place between Sky, Virgin and others that are involved in this. It is right to have in mind that the reason why this has become so topical starts with that case, which is ongoing.

Of course we would say—wouldn’t we?—that the age of things does not necessarily determine whether or not they still have value, and attempts to delete old things just because they are old cannot give much comfort to Members of this House. Is this not perhaps another candidate for the Law Commission, about which we have heard? There is an issue of whether or not this measure is still relevant and perhaps needs to be reregulated. The right thing to do is to accept that there is a big issue here and to carry out the due process to get it to a point where it is considered by a review to ensure that it still delivers good public policy objectives and is good for consumers. I think that the findings will be very useful in understanding that better.

My understanding is that the Government have announced that they will carry out a review of how Section 73 might be amended. I hope that the Minister will let us know what progress has been made—