Mike Weatherley
Main Page: Mike Weatherley (Conservative - Hove)Sale of Tickets (Sporting and Cultural Events) Bill
Mike Weatherley Excerpts(13 years, 3 months ago)
Commons ChamberRead Full debate Read Hansard Text
Mrs Hodgson
It is bizarre—but not surprising. I know that not all Government Members will agree, and if any who do not would like to intervene I shall be more than happy to give way.
Mike Weatherley (Hove) (Con)
Does the hon. Lady agree that what my hon. Friend the Member for Shipley (Philip Davies) just said reinforces the point that those who have the creative talent should be the ones who utilise the tickets in such situations? That is an exact example of our point regarding ticket touts: the person who provides the creative talent should have some control over who goes to watch such events. I am grateful to my hon. Friend for making that point on our behalf.
Mrs Hodgson
Definitely. I do not think that the hon. Member for Shipley (Philip Davies) quite realised he was helping our cause when he made that intervention, but I thank him for doing so.
The situation to which I referred opens up the market to touts. They buy tickets at the low price that the governing body has decided to sell them at, and by selling them on at a profit they deprive fans of lesser means of the opportunity to enjoy top-class sport.
Mike Weatherley (Hove) (Con)
I refer hon. Members to my entry in the Register of Members’ Financial Interests.
I congratulate the hon. Member for Washington and Sunderland West (Mrs Hodgson) on introducing the Bill and on allowing the House to have a lively debate.
Before I get on to the reasons why I—perhaps surprisingly—support the Bill, a little background is in order. At university, I was fortunate enough to attend a speech by the late Sir Keith Joseph, who changed my life. The speech was about free markets and, although I was studying business studies, I had the preconception that it would be boring—how wrong I was, because I was blown away by the arguments. I am a Conservative, because I believe that the free market is far and away the best method by which efficiently to allocate resources. Risk needs to be rewarded, and consumers should have the ultimate say on how products are delivered and at what price. In 90% of cases, the market should decide.
My second interest in the Bill stems from my love of live music and sport. Music and other forms of creative expression are vital to the British economy. I have delivered a number of speeches in the House about the importance of the music industry to the country for overseas earnings and suchlike. The performing arts and sport sustain employment and tax revenues, which benefit all our citizens. There is, however, a blight that creams off revenues by exploiting an imperfect market and contributes nothing to the creative copyright holders. That blight consists of those who profiteer by exploiting excess demand.
Ticket touts who take advantage of availability do nothing to promote our creative industries, and this is one of those rare examples where the Government need to step in to protect creative persons. There are five conditions for the formation of a perfect market, such as perfect knowledge of alternatives and so on. One of those conditions concerns the availability of supply. That is fine for physical products, which can be increased or decreased according to demand—for example, when manufacturing output is turned up, supply increases and the equilibrium price is found again. However, where supply is based on an individual, it is impossible for the number of hours in the day or the number of days in the year to be increased. A performer cannot be in two places at the same time. An imperfect market is then created, and prices rise due to a shortage of supply.
The question is whether intermediaries should be able to take advantage of that imperfection against the wishes of those providing the service. I certainly hope that everyone present in the House today recognises the value of copyright protection to the creative industries. If anyone does not, I suggest that they review the conclusions of the Gowers report, which agrees that intellectual property, and thereby the wishes of the creative person as to how their product is produced, marketed and used, should be protected. The copyright owner should retain control of their product.
Philip Davies
The problem with this line of argument—the comparison with general intellectual property—is that with other forms of intellectual property infringement, the person producing the goods or services loses out. With ticket touting, the promoter does not lose out because if they are selling 50,000 tickets at £20 each, they are hoping to get £1 million, and whether or not a ticket tout buys those tickets and sells them later they still get their £1 million, so they do not lose out financially.
Mike Weatherley
I am grateful to my hon. Friend for making that point, to which I shall give a specific answer later.
The issue is who owns the product that people are going to see. My view is that the copyright owner who produces the good, whether it is a concert or a sports event, is the owner and should have control of it for various reasons. There are many reasons why a business might want to price at below full market value—in specific sectors, market penetration is one such reason; reward for loyalty is another. Football is a good example. There is differential pricing in stadiums, but clubs depend on their regular, grass-roots fan base, and this is recognised in the lower prices in certain sections. Many clubs have a young persons’ section at half-price. They could easily charge full-price for that section, but they do not. If the argument of free market enterprise were applied to those tickets, young people would buy them and sell them on at a much higher value, but the club does not want them to resell those tickets at a higher price, as it knows they could, because it wants to encourage a loyal fan base and benefit the community.
Philip Davies
It is interesting that my hon. Friend uses football as an example because as the Minister said, the restrictions on ticket touting in football are to do not with ticket touting but security. Even so, an increasing number of clubs not only allow but actively encourage season ticket holders to resell their tickets through the secondary market when they are unable to go to a particular match.
Mike Weatherley
I have spoken to various football authorities about this, and the reason they allow the selling on of season tickets is that they recognise that people must have a mechanism for reselling if they cannot go to a match. However, the football authorities would not want someone to sell their season ticket for a particular match at 10 times its value. I happen to be going to a Chelsea-Manchester United match later in the season, but I have not paid 10 times the value of that ticket: I have been given it by a season ticket holder who cannot make the match. That is entirely proper.
Graham Jones
The hon. Member for Shipley (Philip Davies) raised the security issue, and I am somewhat confused by the way he contradicts himself. Surely, with football, there is a problem with ticket touting allowing people with football banning orders to access a match moments before it starts or while it is going on. However, that point is contrary to the one he made about the restraint of trade, which he says should not be allowed. Does the hon. Member for Hove (Mike Weatherley) agree that it is important to have some control over touting? When considering access to football grounds and the potential for violence, it is important that touting is legislated against.
Mike Weatherley
I am grateful to the hon. Gentleman for making that point. It is entirely accurate to say that the selling on of football tickets is problematic because of the segregation of supporters. That is well recognised by all concerned and is just one reason why the promoters of any event might want to restrict to whom tickets are being sold. There are other reasons, and I shall give a good example of one that relates to Conservative Members in a moment.
An hon. Member explained to me that that restriction would not apply to house building—that a developer who builds houses should be free to sell to people, and those people should be free to sell on again. Of course that is true, but if, for charitable reasons, the developer wants five of those houses to go to Cancer Research nurses, they are quite within their rights to say, “We will only sell those on in future to Cancer Research nurses” and restrict the free market into the future as to where those houses go. I see that as no different from the owner—the creative industry person who creates the product—deciding what they want to do with their product into the future. It is essential, therefore, that the owner of the skill or creative talent, or supplier, has a say in who the end user is—but not in all situations. The Bill does not cover every event, and the promoter or band who wish to cover their event have to so designate it.
It is impossible to restrict onward selling without having a mechanism for refund, and the Bill not only allows for a refund but allows on-sale at a premium, be that 10% or double face value or whatever has been decided in the final stages. I am going to a concert tonight—The Cult at Hammersmith Apollo—and my colleague has a spare ticket. He is going to on-sell that ticket at face value, and he should be able to do so. I see no reason why, in that situation, he should not. There are no crowd control or exploitation issues.
However, our discussion relates to those ticket agents that advertise sporting or music events later in the year—sometimes before tickets are even on sale—at 10 times face value. They buy in their hundreds and sell on at huge profits. It is possible to buy Chelsea tickets for later in the season right now, although they are not on sale—and incidentally, as everyone knows, the premier league has a rule on selling at face value only. That is a clear example where the free market for ticket sales is not advantageous. We have mentioned the Olympic games; a non-profit clause is enshrined in its arrangements as well.
There are other cases where the issuer reserves the right for tickets to be non-transferable—train and plane tickets, for example. I expect that when hon. Members sell tickets for a fundraising dinner, they reserve the right to object to a replacement being issued. Can they imagine tickets for the forthcoming Conservative ball, which are £400 each to raise funds for the party, being bought up by touts and sold on at £1,000 to lobbyists, or others, whom they may not necessarily want in their midst? Of course not. The point is that the person giving the function restricts the number of tickets, and insists on the person buying attending or getting permission to transfer. It is right and proper that the person providing the event has some say in that.
On the face of it, ticket touts provide a free-market service, but scratch a little deeper, and for some events that is a misguided and counter-productive service. The touts are exploiting a market abnormality to the detriment of the wishes of those who put on the event.
The proposals in the Bill are fair, in that selling at a small premium is allowed and not all events are covered. Only those wishing to be bound by the rules need apply. If the artist is happy for their tickets to be sold at a premium, that is fine. I slightly disagree with the hon. Member for Washington and Sunderland West, who said that Madonna would sell at a premium on an auction. I think it right and proper that she be allowed to do so; that is a free-market thing, and she has control of her product to do what she wants with it, but if she has decided that she wants to sell it at a certain price, that should be respected by the copyright owner.
Sarah Newton
Does my hon. Friend agree that we have rightly, as a coalition Government, focused on wanting to support free enterprise, to create a lot more jobs in the private—
Sarah Newton
I am sorry; of course, Mr Deputy Speaker.
Quite rightly, the coalition Government have focused on supporting small business, private enterprise and growing jobs in the private sector. Does my hon. Friend agree that the Government should be listening to such an important and growing sector of our economy as the creative industries? They have identified this practice as being problematic and standing in the way of them growing this successful business and creating new jobs in our economy.
Mike Weatherley
My hon. Friend makes a very good point. If a business wants to develop its products, it might underprice in the market for a number of reasons, as I have said, one of which could be market penetration. If someone wants to develop a fan base and encourage people who might not necessarily come to watch their events or try their commercial products, they will often use prices far below market value to get people to try them for the first time. A lot of ticket promotions do that specifically for concerts, sporting events and so on. Small businesses and small events that are trying to grow their business can have very good reasons why they might want to carry on a market penetration for a long time into the future. I thank my colleague for her intervention.
The price that the creative copyright holder wants to charge should not be a judgment for the House or any external body. If a biscuit manufacturer wants to give away biscuits for sampling purposes, we should respect that. We should not say that touts can buy them up and sell them on. As my hon. Friend said, we should help that business to develop its market. We should not be judgmental about what it does for commercial reasons. Let us not kill the goose that lays the golden egg. Let us listen to the music managers, football clubs and those who provide creative services—I have met no one who is against this measure—and get behind the Bill to the benefit of the country in the long term.
Sajid Javid
My hon. Friend makes a fair point. In some cases, that can be advantageous, but I accept that where there is clearly very high demand, there are sometimes good reasons to restrict the number of tickets that an individual can buy.
Mike Weatherley
Does my hon. Friend agree that the people who should be making that judgment are the music promoters and managers, who almost unanimously say that the point made earlier by my hon. Friend the Member for Shipley (Philip Davies) is totally inappropriate, and that they do not like that way of selling? They prefer to sell directly to the fans, rather than to those intermediaries who distort the market for the type of person they want to come to the concert.
Sajid Javid
It is a varied market, and different promoters and creative acts will wish to sell their tickets in different ways. It could well be the case that they do not like selling tickets in bulk—that is their choice; no one is forcing them to do so—and if they wish to sell individual buyers a maximum of two or three a time, that is their choice. Equally, the price at which tickets are sold is their choice, and if a company or creative act is genuinely concerned about that, they always have the option to increase or reduce the price. That is how the free market operates.
Mike Weatherley
Is that not exactly the point? The copyright holder themselves can make that judgment. Many promoters restrict ticket sales to four or six at a time, only to find that 100 are on display through the software programmes that the hon. Member for Washington and Sunderland West (Mrs Hodgson) mentioned and that offer multiple ticket buying in different formats. If the promoter wants to offer a maximum of six to an individual, he should be allowed to do so.
Philip Davies
That is a perfectly fair point, but the hon. Gentleman did not manage to persuade his Government to adopt that approach when they were in office, as they killed the Bill when it last came up, so I am not entirely sure why anybody who is against it now should be considered a tyrant, because his Government killed exactly the same Bill in the previous Parliament.
New Labour clearly is not dead, because the hon. Gentleman seems to think that just by asserting something, it is therefore true: so if he says that he believes in the free market, it is therefore sufficient proof that the Labour party believes in the free market. I take a rather different view: I think our policies have to reflect our assertions. We cannot just say, “I believe in the free market” and then pass laws that completely fly in the face of the free market. I ask him for some consistency, so that his lofty words about believing in the free market might be followed up by action and policies that support them. I am afraid, however, that I cannot see any of that happening.
Mr Deputy Speaker, you are in a privileged position in this debate, because you were also on the Culture, Media and Sport Committee with me when we considered this matter two or three years ago. We conducted an interesting inquiry. The hon. Lady was absolutely right: not only did we find the secondary market to be perfectly legitimate, but her Government found exactly the same. She did not mention this point, but she will also be aware that the Office of Fair Trading has always made it clear that the secondary market for tickets is not only not a bad thing but actively works in the consumer’s favour.
That brings me to my hon. Friend the Member for Hove (Mike Weatherley), who says that the people who own the rights to an event—the promoters or, in his words, the holders of the intellectual property—should be free to determine such matters. That is a perfectly legitimate and respectable view to hold, but I do not agree. I was encouraged, nevertheless, as he said he was not really taking the consumer’s interests into consideration. They did not matter; what mattered was the intellectual property holder. That is a perfectly respectable view, but I do not agree. I think that the public—the consumers—are an important part of the process.
Mike Weatherley
My hon. Friend makes a good point, and I thank him for his comments, but does he agree that the point is not about the free market, which we all fully endorse and support, but about the ownership of the product, control over the creative product and the ability to determine whom one should sell to and deal with?
Philip Davies
I agree with my hon. Friend on many things, but not on this. I believe that if I sell a product to somebody else who hands over the money that I have asked for to purchase it, I have ceded that product to that person. That is the whole point of the free market. If somebody goes into a supermarket, buys a product and sells it on, I do not believe that the supermarket should have a go at that customer for doing that; once it had sold it, it was that person’s to do what they wanted with it.
The issue comes up in all sorts of things outside sporting and cultural events. We did not have time to go into other matters during the speech made by the hon. Member for Washington and Sunderland West, but I would be interested to know how she feels about them.
To save any misunderstanding, I make it clear that I am not arguing from a personal interest perspective, but there is often a big hoo-ha in the press when a limited edition of designer handbags goes on sale in Selfridge’s or some other big department store, and there is a huge queue outside to buy the 25 available. Alternatively, Buzz Lightyears go on sale at Christmas—everybody wants one, but there are hardly any left. Massive queues form outside overnight. The lucky 20 dash in and buy the few available and within five minutes flat the product is on eBay being sold at 20 times the price because the person who bought it knows that there is a much bigger demand than the shop was able to accommodate.
I am not entirely sure whether the hon. Lady or the hon. Member for Dudley North are suggesting that, from their party’s perspective, it is the Government’s job to start regulating all these matters, so that if somebody buys somebody else’s intellectual property and then uses the free market to sell it at 25 times the price, the Government should stop that. If the hon. Lady or the hon. Gentleman are suggesting that, I should like them to stand up and say so; if they are not, perhaps they will explain what the difference is between somebody who buys a ticket to an event and somebody who buys a limited edition of a Buzz Lightyear, a handbag or anything else. Perhaps my hon. Friend the Member for Hove could do the same. I see no difference at all. It seems to me that once the Government go down the road of controlling the market in tickets, they are opening up the floodgates, or a slippery slope, of intervening in every single nook and cranny of the commercial world.
Philip Davies
My hon. Friend makes a good point about what constitutes a “real fan” in these matters. If somebody is prepared to pay £2,000 or £5,000 for a ticket to a concert, I would argue that it provides the best example of a real fan. Nobody is going to pay that kind of money for a ticket to an event in which they are not really interested. It seems to me, then, that the free market and ticket touting help the real fans to find their way to the front of the queue rather than get clogged up by people who might be buying on a whim because the tickets are rather cheap.
The hon. Lady says that she is trying to help the organisers and others to sell the tickets for the benefit of real fans, but perhaps she should reflect a bit further. Some of the concert and sporting promoters should also reflect on the part of the ICM opinion poll showing that 71% of people agreed that too many tickets for major sporting and cultural events were allocated to corporate sponsors, hospitality packages and VIPs. On this particular matter, I tend to agree with my hon. Friend the Member for Hove, who would presumably say that these are their tickets and they are entitled to give them to whomever they want. I would not gainsay that in this particular case. It is a bit galling, however, for people to be lecturing everybody on how they want the real genuine fans to have the tickets at a price they can easily afford when they are some of the worst when it comes to real fans not getting their tickets, because of the “prawn sandwich brigade”.
Mike Weatherley
Would my hon. Friend care to meet some of the music managers with me and be lectured by them? Perhaps we could also invite some real and true fans to come along to express their opinion so that we get a breadth of viewpoint. I wonder whether the Minister would also like to accompany us on this particular venture.
Philip Davies
My hon. Friend makes a tempting offer and it would be churlish of me to turn it down, so I look forward to receiving that invitation. I am encouraged: the longer I speak, the better the invitations I get. That encourages me to keep going a little while longer. I do not mind the free market—if anyone has a better offer, I would be prepared to hear it. I can assure my hon. Friend that I have already heard these arguments, as the Select Committee heard the views of promoters. I suspect that even the mere mention of my name to a certain Harvey Goldsmith is likely to give him a near-heart attack. Some of the spats that he and I had—not just in the Select Committee, but on radio interviews afterwards on the issue—seem to have done his health more harm than good. I am certainly aware of the arguments, but I was not persuaded by them.
My hon. Friend the Member for Bury North made a good point about who the real fans are in this case. Who are we trying to protect? Who are the people who are losing out as result of ticket touting? I have never worked out who the losers are, but they are certainly not the promoters. They do not lose out in any shape or form from ticket touting and nor do the artists.
Philip Davies
My hon. Friend is ingenious as ever. That might be something that the Procedure Committee will want to consider. I suggest that my hon. Friend mentions it to our right hon. Friend the Member for East Yorkshire (Mr Knight). I shall look forward to that system being introduced.
I do not think that things work against the interests of the promoter. The promoter gets all the income that they were ever going to get in the first place, so the promoter is looked after. The issue is then whether things work in favour of the consumer. As I hope I have argued, the fact that the consumer can buy tickets right up to the end means that it works in their best interests, too. I must say in passing that if ticket touting is such a big issue for concert promoters and sporting promoters—if it is the be all and end all and the biggest single threat to their business—it is a wonder that they do not do more imaginative things to try to stop the antics of ticket touts. My hon. Friend the Member for Hove said that it should be up to them what they do, and it is. Perhaps, rather than selling all the tickets in one go right at the start so that they are sold out in five minutes flat, which provides a perfect market for the ticket tout because no tickets are on open sale, why not sell tickets gradually week by week, so that there are still some tickets on open sale right up to the day before the concert? There would therefore be no market for the ticket touts.
I do not think that the solutions to the problems lie with more legislation, but of course that is what the Labour party always reaches for. If Labour Members perceive a problem—for the avoidance of doubt, I am not saying that there is a problem—they think the only solution is more Government legislation, more Government interference and more of a nanny state. The solutions to these things are often in the hands of the promoters and I want to see an explanation of why more promoters do not sell tickets bit by bit, week by week and day by day, so that tickets are still available on the open market the day before. There would then be no market. Perhaps the hon. Member for Dudley North could explain what is wrong with that solution. I see that he does not want me to give way, so perhaps I have talked him round. Perhaps this is a triumph that I did not anticipate. He appears not to disagree with me, so I shall leave it at that.
I want to refer to the Office of Fair Trading. People seem to think that not allowing the person who owns the property to set the price will make the price more expensive for the consumer. I take issue with that, because when I had the pleasure of working for Asda, it challenged the net book agreement. I do not know whether hon. Members remember the net book agreement, which allowed publishers to set the price of books and which prevented anyone else from selling the book at a different price.
I presume that my hon. Friend the Member for Hove supports the net book agreement, because the book belongs to the publishers, who should therefore be able to force everybody to sell it at a particular price. At Asda, we thought that that was against the interest of the consumer, that it was a protection racket and that it flew in the face of the free market. We took our case to court to argue that we should be able to sell books at the price that we wanted to sell them at and that there should be a free market. After a lot of to-ing and fro-ing and a lot of expense, I am delighted to say that Asda won its case and the net book agreement was broken.
What has been the upshot of the end of the net book agreement? If the argument advanced by the hon. Member for Washington and Sunderland West holds, prices would have risen: people would have abused the system by charging all sorts of prices. The nice, kind publisher would have wanted as many people as possible to read the book, and would have sold at the cheapest possible price, while the nasty retailers would have hiked up the price to increase their profits. The exact opposite actually ensued. Since the net book agreement ended, book prices have decreased, so breaking that restriction worked in the best interest of consumers. I do not see the difference between books and tickets, because the principle is the same. The free market won out in the courts, and I hope that it will continue to do so.
Mike Weatherley
My hon. Friend has set out a good economic analysis. Does he accept that in commercial terms there is such a thing as price differentiation in different markets for various reasons by the producer for long-term commercial purposes?
Philip Davies
Indeed. My hon. Friend has made some perfectly reasonable points, but I happen to disagree with them. Most of the problems that he has identified can be solved by the industry itself, and I have made some imaginative suggestions. If ticket touting is such a big issue, tickets should be sold on the open market by auction, as my hon. Friend the Member for Christchurch has suggested, which would maximise income and get rid of ticket touts, who would have no business.