Public Bodies Bill [HL]

Lord Wigley Excerpts

Wednesday 9th March 2011 Lords Chamber

[Lord Wigley]

My Lords, perhaps I may first declare an interest. Between 2003 and 2006, I was a member of the S4C authority, and my son, daughter, son-in-law, daughter-in-law and my wife—and I occasionally—receive some benefit from participating in their programmes. My great interest by far, however, is as a Welsh speaker and a television viewer in Wales.

I support Amendment 83 standing in the name of the noble Lord, Lord Roberts of Llandudno. I also speak to Amendment 113D, standing in my name.

As has been said, this is a very sensitive subject in Wales. When I entered the Commons in 1974 the structure of television in Wales caused immense frustration to both language camps. Welsh language television programmes were carried by both BBC and ITV main channels in Wales, a small proportion of which were at peak viewing hours. Non-Welsh-speaking viewers were frustrated at having programmes they could not understand thrust upon them. Equally, Welsh speakers were frustrated that at best they received a fragmented service, with BBC and HTV duplicating news and current affairs programmes. The sum of the parts just did not add up to a comprehensive service. Most of the programmes were away from peak hours. There were protests; many language activists refused to pay their television licence fee; and some went to prison.

Before the 1979 general election, the Conservative Party promised a dedicated channel for the Welsh language. A few weeks after the election, the then Home Secretary, in a speech in Cambridge, announced that the Conservative Government had done their first U-turn, abandoned their election promise and were not going to provide a single-channel solution. This led to massive protests, which culminated in Plaid Cymru’s former leader, Gwynfor Evans, announcing that, unless the Government kept their word and provided a Welsh channel, he would starve himself, if necessary, to death. Thousands protested, including many senior people in Wales. Hundreds of us refused to pay our television licence; I myself went to court for so doing, as did many colleagues.

Cutting a long story short, the Government realised that they had badly misjudged the situation. People from all parties intervened. The noble Lords, Lord Crickhowell and Lord Roberts of Conwy, both Welsh Office Ministers at the time, pressed colleagues with the strength of representations they were receiving from figures such as the Archbishop of Wales, the former chief civil servant in the Welsh Office, Sir Goronwy Daniel, and the former Secretary of State for Wales, Cledwyn Hughes, later Lord Cledwyn of Penrhos.

It matters not for the purpose of this debate whose representations carried most weight or for what reason. Suffice it to say that the Thatcher Government recanted. Discretion was quite rightly the better part of valour. A further U-turn took place and the channel was given the go-ahead. The rest is history.

However, understanding the significance of that history is essential to understanding the situation which faces us today, which seems almost like a rerun of history. For the first time since 1979, last May we had a new incoming Conservative Government. The Conservatives had during the preceding election campaign made no reference whatever to their intention to restructure S4C. As in 1979, with no consultation in Wales, policy was reversed after the election. Need I say more?

As has been said, the Welsh language is spoken by 20 per cent of the 3 million people living in Wales, amounting to about 600,000 people. There are probably a further 100,000 Welsh speakers living in the rest of the UK. It has been estimated that 57 per cent of homes in Wales have at least one person who understands Welsh. S4C is watched by more than 600,000 people in the course of an average week.

That figure is less than the reach of almost 1 million people which existed six years ago, which has been mentioned. There are two reasons for the change, both associated with the changeover to digital television. First, while it undertook analogue transmissions, S4C broadcast English-language Channel 4 programmes during off-peak hours when it was not transmitting Welsh programmes. Clearly, when those were no longer available, many English monoglots no longer tuned in to S4C. Secondly, digital switchover led many viewers of all four old analogue terrestrial channels to migrate to explore the offering available elsewhere. S4C was not immune to that trend. The drop in viewers was predicted by the DCMS as far back as 2005. Having suffered those setbacks, I am glad to say that the graph has turned over the past 12 months, with an increase of 10 per cent in the channel’s reach across the UK to an average level of 616,000 in 2010. In the week ending 23 January, almost 1 million people tuned in across Britain—no doubt aided by the fact that the Cardiff City against Stoke City FA Cup match was being broadcast live.

It is also worth emphasising that the average programme viewing figures have been affected by the setting up of the brilliant toddlers’ space called Cyw, which provides programmes for the under-fives on weekday mornings between 7 am and 1 pm. Those programmes can never aspire to more than the few thousand viewers: the available cohort is probably no more than 15,000 and the likely viewership under 5,000.

Some people have poured contempt on figures as low as that, yet as a service it is critical for language transmission, particularly in households in English-speaking parts of Wales. I am glad that Cyw was awarded international recognition in New York earlier this year. The facile use of statistics by DCMS Ministers to denigrate S4C has been unworthy and reflects a failure to understand the reality of the Welsh language, the channel and its role.

I make one thing quite clear. There is no question of saying that everything has to stay exactly as it has been over recent years. Indeed, S4C has in recent years already cut back its central staff from 210 to 154 at present, and is committed to further reductions down to 114. Surely that is an adequate indication of its intent.

Everyone in Wales realises that, in the current financial constraints, all services funded by the public purse are likely to face cutbacks and S4C cannot be immune from these. To that extent, the funding formula of RPI, which has looked after S4C for two decades, cannot be regarded as sacrosanct. We did, however, note last weekend the emphasis of the Prime Minister, David Cameron, in Cardiff when he stated that Wales was being protected from the worst level of the cuts hitting other parts of the UK because of our difficult economic position, and that the average cuts would be 2 per cent per annum over the next four years. I am sure that S4C, however reluctantly, could live with cuts of that order, but not with the 24 per cent cuts in real terms that have been predicted—or more likely some 40 per cent in cash terms over that period.

The importance of securing guaranteed funding for the channel, removed from the annual political dogfight, was the reason it was safeguarded in legislation by the RPI formula. Unpicking that legislation, however inevitable in today’s climate, is not something to be undertaken lightly. There is, however, a feeling that any cash cutbacks to be faced by S4C should be no greater than those faced by other public services.

The worst aspect of this saga is probably the way in which it has been handled by DCMS Ministers. Decisions were taken without any meaningful discussion with those in Wales who have a legitimate interest in these matters, and without any engagement with S4C itself, its audience, or its stakeholders in Wales. We should also remember that some 40 private companies are dependent to a greater or lesser extent on S4C and will be affected by the changes which were unilaterally announced by the DCMS last year. S4C, in fact, paid over £88 million into the Welsh economy in 2010—money that has been vital in building up the private sector television and film industry in Wales so that it can compete in world markets.

The initial discussions with the BBC were overwhelmingly at a UK level, with even BBC Wales out on a limb. Involvement with S4C itself has been less than open, with the channel finding out at second hand what DCMS Ministers had in mind. The DCMS seems to have studiously avoided engaging directly with the Government of Wales, despite the fact that both the Welsh language and education are fully devolved functions and that S4C has a significant contribution to make to both those portfolios. Furthermore, when the junior DCMS Minister in another place, Mr Vaizey, appeared before the Select Committee on Welsh Affairs on 18 January, he admitted—he almost boasted—that no, he had not ever watched a single S4C programme. This was despite the fact that he had ministerial responsibility for the channel and that 80 per cent of S4C’s output could be watched with subtitles.

Your Lordships will hardly be surprised that over recent weeks there has been growing demand for responsibility for S4C to be transferred from the DCMS to the National Assembly. This has been augmented following last Thursday’s referendum. To my mind, there appear to be three elements which are essential for a solution to gain support in Wales. First, there has to be an acceptance that S4C is currently an independent public body, set up by statute. It is not acceptable for such a body to be abolished at the whim of a Minister using Henry VIII-type powers to do so. That is why I included in my Amendment 113D a provision that the powers given to the Minister at Westminster can only be used with the consent of Ministers of the Government of Wales.

It should be noted that those in the Assembly recognise that there must be change. Reference has already been made to the letter sent to David Cameron dated 29 October 2010 and signed by all party leaders in the Assembly, which proposed,

“a comprehensive examination of all aspects related to the governance and regulatory oversight of S4C, including where political responsibility should lie, on the basis of ensuring a secure and sustainable funding stream for the Channel”.

That was a very positive proposal, but it does not seem to have led to anything. Whatever new structure might eventually transpire, I would urge that the corporate and commercial independence of S4C should be guaranteed. I am not persuaded that this can be done by bolting S4C on to the structure of the BBC. If it was, the campaigning target in Wales will inevitably switch to securing that what is currently BBC Wales becomes more independent from the BBC in London. I know that there is sympathy for such restructuring in Scotland and in some quarters in Northern Ireland. However, such fundamental changes should be part of a comprehensive new communication Act, not matters that arise from the ill thought-out schedules to a rushed Public Bodies Bill.

Secondly, whatever the model of the constitutional governance of S4C, there is also the question of the editorial independence of the channel. If the corporate independence of S4C is guaranteed, then of course its editorial freedom should per se be implicit in such a solution. If anything less than full independence is provided, the editorial freedom of S4C becomes a pressing issue, and it would have to guarantee the right of S4C to reject the editorial line taken by the BBC or, indeed, by politicians.

Thirdly, and crucially, there is the issue of the guarantee of finance. I have no objection whatever to S4C being funded from the licence fee because the proposal has much logic. However, if it is to be funded from the licence fee, that must—it really must—be done through a route that is independent of the BBC, as has already been mentioned. Once S4C becomes a supplicant of the BBC, it is finished. He who pays the piper calls the tune. It is my belief that S4C should have a proportion of the licence fee safeguarded by statute, perhaps around 2 per cent of the total licence fee take for the UK. The present formula gives S4C £90 million a year from the DCMS budget. The department sees its contribution dropping from £90 million down to £6.7 million by 2013, a 90 per cent cut in its contribution. Perhaps the Government of Wales might be able to contribute a sum similar to that £6.7 million and thereby secure an equal voice in terms of the channel’s future. Securing an acceptable financial deal is basic to S4C and to retaining any meaningful independence for the channel.

Whatever way things move forward, there is a pressing need for the Government to clarify how they see the channel being funded post 2015. At present, there is a vacuum and great uncertainty, and frankly that is unacceptable to the small private companies in the sector which may be reluctant to invest if they feel that there is no ongoing financial certainty. But it is not enough to guarantee funding for the independent producers, important though that is. S4C itself needs some £20 million a year to maintain essential services such as transmission costs of over £7 million a year, subtitling costs, programme and viewer research, promotion of the channel and its legal and administrative responsibilities.

Securing a stable, practical and sustainable model for the future of S4C is immensely complicated and not something to be decided on the margins by unamendable orders in Parliament. It is therefore my preferred option for your Lordships’ House to cut S4C entirely from this Bill and, if necessary, for the Government to bring forward new proposals after proper consultation in Wales and elsewhere as part of the development of a communications Bill in a few years’ time. I hope that the Minister will accept at least the spirit of Amendment 113D on such a basis, but if she is not prepared to give a commitment to explore these possibilities and to come back with the necessary amendments on Report, I hope very much that the noble Lord, Lord Roberts of Llandudno, will press Amendment 83 to a vote and that it is supported by noble Lords on all sides as an indication made by this Chamber that the Government really must give further thought to this matter. Whichever way, I urge the Government to think again long and carefully on such a sensitive issue.

--- Later in debate ---

[Baroness Rawlings]

I appreciate what my noble friend Lord Thomas said, and I am getting there, but if I am interrupted all the way through, I will not be able to get there. I will come to that point.

The reservation of broadcasting is for sensible reasons. We have both European and international broadcasting obligations, and it is appropriate for those obligations to be secured on a UK basis, largely because of the nature of broadcasting itself. It is clear that spectrum does not respect boundaries, and we know that S4C can be and is viewed in parts of England. We are committed to ensuring that all the nations in the UK are properly served with broadcasts which suit their individual needs, but it is right that it should continue to be a UK function to do so.

The Secretary of State for Culture, Media and Sport works closely with the Secretary of State for Wales on S4C matters to make certain that a Welsh perspective is fully taken into account. The interests of S4C will be protected by the coalition Government and the new arrangements. In addition, to make certain that the Welsh aspects are fully taken into account, the Secretary of State for Culture, Media and Sport and the Secretary of State for Wales have agreed new arrangements whereby Wales Office Ministers will be involved in all ministerial meetings relating to S4C. Wales Office officials will be involved in the drafting of all submissions on S4C matters. I hope that that satisfies the noble Lord, Lord Rowlands.

In recognition of the importance of Welsh language programming and in the light of the changing financial situation, the Government believe that the best way for the audience to have a high-quality service is through a partnership with the BBC. My officials are currently in talks with the BBC and S4C about the arrangements for such a partnership. A review of the service, which should cover both its funding and output, will be conducted towards the end of the current spending review period. It is important that we give the partnership some time to grow and to deliver the efficiencies and increases in quality that we fully believe can be achieved.

I assure the noble Lord, Lord Wigley, and the noble Baroness, Lady Morgan, that DCMS is in discussion with the BBC and S4C to develop the new partnership arrangements. DCMS officials have engaged with Welsh independent producers as part of that process, and we continue to do so.

[Lord Wigley]

I am grateful to the Minister. Can she confirm that the discussions that she mentioned—DCMS officials discussing with the BBC, S4C and the independents—took place before the decision was made?

[Baroness Rawlings]

These discussions have been ongoing throughout. The noble Lord also asked whether there was prior consultation with the Welsh Assembly Government. Given the scale and pace of the spending review and the licence fee settlement discussions, it was not practical to have in-depth discussions with all the interested parties ahead of the announcement. The timeframe reflected the Government's desire to put the UK finances in order.