Digital Markets, Competition and Consumers Bill (Third sitting)

Debate between Vicky Ford and Andy Carter

Committee stage
Thursday 15th June 2023 Public Bill Committees

[Andy Carter]

Q Do you think five years is the right length? Should it be a shorter period?

Neil Ross: It is as much as five years; it could be longer. It is really how the digital markets unit looks at that. Companies in the broader sector would be given a lot of certainty if the DMU came out fairly early on and set up a priority list of where it is likely to look first. There is quite a good precedent in the Communications Act 2003 of the reporting powers conferred on Ofcom. I know the CMA has some reporting capabilities, but given the wide-reaching powers of the Bill, it might make sense to also think about applying the same standards to the digital markets unit.

[Vicky Ford (Chelmsford) (Con)]

Q You have mentioned a few times the importance of accountability to Parliament. I guess that needs transparency so you can get scrutiny. Do you think there is adequate accountability and scrutiny in this Parliament? How does it compare with other Parliaments?

Neil Ross: With this Parliament, the CMA is here quite a lot and so are the other regulators, so there is regular scrutiny of the regulators themselves. As the various different Bills go forward, whether that is the Online Safety Bill, the Digital Markets, Competition and Consumers Bill or the Data Protection and Digital Information (No. 2) Bill, we might have to think again about exactly how we are scrutinising those interrelated bits of digital regulation. That is a decision for this House and how you want a change of structures. It would be important to make sure—

--- Later in debate ---

[Andy Carter]

Q Thank you. I have one question for you, Mr Smith, if I may. We are taking action to legislate; the EU has taken action to legislate. Many other countries are not yet in that place. Are we not just going to drive innovation outside of the UK?

Tom Smith: I think a lot of major economies are in the same place and moving forward in the same direction anyway. There are rulings against Google in India. There is app store legislation already in force in Korea. The Netherlands has a ruling against Apple’s app store. Australia is proposing a very similar regime to this one. There are lots of proposals, obviously, in America. Germany already has its regime in place and in force, as does the EU. There is a major benefit to all the major economies moving forward together because these are global issues.

As for deterring investment, I would say that monopolies do not stimulate innovation, competition does. That is the whole point of the Bill—to open up competition and get rid of artificial restrictions. When Apple bans alternative app stores on its devices, it is just holding the market to itself. If the DMU removes that ban, new app stores can come in and innovate. Maybe they will offer a better service than Apple; maybe they will not, and people can stick with Apple and Apple can make lots of money. That is great if it has a better product, but currently it is not being challenged.

[Vicky Ford]

Q Can you give us an example of the rent inflation you mentioned? For the app, how much would they have been paying five years ago and what are they being charged now, just to contextualise this?

Gene Burrus: The problem bothering a great number of our members is the forcing of the use of an in-app payment system that comes along with a 30% tax on any apps that sell what are called “digital goods” from within their app. If it is a digital subscription for a gaming app, for a news app or for music streaming, that comes along with a 30% charge. Those digital platforms did not contribute anything to those products; they simply take it off the top.

Ten years ago, the game was the opposite. People were actually paying those developers to come on to the platforms. To some degree, it has been a bit of a bait and switch for these platforms. When they were facing competition, they had one business model and, once they achieved dominance, they altered their business model to try to extract those rents. Making the bet with that 30% is probably one of the best examples of that.

Digital Markets, Competition and Consumers Bill (Fourth sitting)

Debate between Vicky Ford and Andy Carter

Committee stage
Thursday 15th June 2023 Public Bill Committees

[Seema Malhotra]

Q On a slightly different area, there were some concerns raised by some Members in the debate on the Bill about the Government changing the appeals process to one based on judicial review, as opposed to a merits-based review. How important, in your view, is that, and what would you want to see if the Bill progresses through Parliament?

Kelli Fairbrother: It is absolutely critical that judicial review is the standard that is used, because I think we have seen time and time again, in markets all around the world, that when Governments act, Apple and Google do their best to try to get around the work that is being done. They lawyer up—they have millions to spend on appeals slowing things down—and there really is a sense of urgency. This is existential for a lot of small app developers, so we would really urge that the Bill passes, it is not watered down and it passes without delay and without dilution, I think we would say.

Christian Owens: I agree.

[Andy Carter (Warrington South) (Con)]

Q I have just downloaded your app, so you have got another customer there.

[Vicky Ford]

He is such a charmer.

Digital Markets, Competition and Consumers Bill (Second sitting)

Debate between Vicky Ford and Andy Carter

Committee stage
Tuesday 13th June 2023 Public Bill Committees

[Vicky Ford]

Thank you—and sorry, colleagues, for the family discussions.

Max von Thun: I am not a huge gamer, but that is my take.

[Andy Carter]

Q Can I ask about the whole area of innovation, particularly for smaller start-up tech firms? What is your feeling towards the Bill with regard to the attitude that they might take to operating in the UK?

Max von Thun: Overall, I think it would be very positive for those types of firm. As others have said, this Bill is very targeted: the actual regulatory obligations apply to only a very small handful of dominant firms. It is not legislation like the Online Safety Bill or privacy regulation, where you are creating a compliance burden for the whole tech sector; it is very targeted at dominant firms.

As I mentioned earlier, if you look at what the Bill is trying to do, it is very pro-innovation. It is really about introducing contestability into the market. The combination of the conduct requirements, which are more about stamping out some of the problematic anti-competitive practices that we have seen over a long period, and the PCIs, which we think are a more significant tool because they allow you to inject competition into the market through interoperability and opening up data, will be very good for start-ups. I think it will give them more confidence to launch businesses that directly take on the dominant tech platforms.

At the moment, if you are a smaller firm, your strategy will often be to grow to a certain point and then get bought up. That is how firms design their business model, and investors will often look at it that way, but if through legislation you change the picture, you will change the incentives and create more opportunities for companies in the UK to scale up to a global level.

Equality Act 2010: Children from Disadvantaged Backgrounds

Debate between Vicky Ford and Andy Carter

Tuesday 13th October 2020 Westminster Hall

[Vicky Ford]

Positive action is designed to enable opportunities to be given, as opposed to positive discrimination, which is unlawful. That is why it is so important that the guidance is clear on the subject. We need to promote the level playing field and enable levelling up, and not encourage behaviour that could constitute levelling down.

We need to avoid taking a tick-box approach. Amending part 1 of the Equality Act would not necessarily lead to what my hon. Friend seeks, because there is a real danger that it could create a tick-box mentality, which might be seen as an acceptable substitute for meaningful action. We want to avoid such distractions and concentrate on real help. I assure him that the action he has taken today has ensured that the Government will keep both the legislation and the guidance under review.

We are also improving our approach to equalities. We are reshaping the Government Equalities Office, bringing it closer together with the race disparity unit and the disability unit to create an equality hub. We need to move away from the idea that we are simply dealing with groups that already enjoy Equality Act protection, and instead ensure that we are looking at individuals across the country and identifying those who are most in need, what their biggest barriers to success are and where there is unequal delivery of public services. We want to examine issues such as geography, as my hon. Friend the Member for St Austell and Newquay (Steve Double) mentioned, where communities in certain areas risk being held back. We also should be focusing on analysing the data, looking closely at individual dignity and opportunity and also at areas such as income and background, so that we have a more holistic view.

We understand, however, that pupils from disadvantaged backgrounds, including boys, may face greater challenges at every stage of education. We are committed to addressing those challenges, levelling up education standards and improving outcomes.

[Andy Carter]

Will the Minister tell us a little bit about how the Government are particularly addressing the issue of boys from disadvantaged backgrounds, to get that levelling-up agenda delivered?

[Vicky Ford]

Absolutely. One of my passions is the early years of development, and too many children, especially those from disadvantaged backgrounds, are falling behind in those early years. It is then so hard to close the gaps once they have emerged, and evidence shows us that what happens in a child’s pre-school years—those very early years—are the most important and have a huge influence on later outcomes. That is why the Government have been making record investments in early education, including 15 hours of free education for all disadvantaged two-year-olds as well as three and four-year-olds. It is also why we have doubled the amount of free childcare available to three and four-year-olds for working parents.

These investments have led to a real improvement. The latest early years foundation profile shows that the proportion of all children reaching a good stage of development by the time they start school—year 1—has gone up from 51%, or one in two children, in 2013 to nearly 72%, or two in three children, in 2019. Furthermore, over the same period, the gap between the children who are eligible for free school meals and their peers at age five has narrowed from 19 percentage points to just under 18 percentage points. Indeed, the same is true in school: because of the education reforms that were mentioned by my hon. Friend the Member for Warrington South (Andy Carter), 86% of schools are now judged to be good or outstanding, compared with only 68% of schools in 2010. As a result, the disadvantage attainment gap has narrowed by 13% at age 11 and by 9% at age 16, and it has narrowed at every stage from early years to age 16 since 2011. However, we know there are still issues in other areas, so we have committed an extra £18 million to the £72 million opportunity areas programme to transform the life chances of young people in 12 of the most disadvantaged areas of the country—those with particularly low social mobility.

My hon. Friend the Member for Warrington South also mentioned the very important issue of exclusions. It used to be the case that looked-after children—children in care—had the very highest rates of permanent exclusion, and we are making sure that those children in care, who often have the worst life outcomes, are supported to succeed in education. For example, we have put in place virtual school heads, designated teachers for looked-after children, and extra funding through the pupil premium plus for this group. The virtual school heads, in particular, have made a significant impact since they were introduced in 2014. Data shows progress across maths, reading and writing for looked-after children, and today, looked-after children are less likely to be permanently excluded from school than all other children. Interventions of this nature are making a real impact on some really disadvantaged groups.

However, we know that the disadvantage gap is at risk of widening because of the pandemic. Lack of digital access is of particular concern, and that is why we have committed over £160 million to support remote education access and provided nearly half a million laptops and tablets to those most in need. We have also announced the £1 billion covid catch-up fund, of which £350 million is going into the national tutoring programme. That will particularly focus support from high-quality tutors on disadvantaged and vulnerable children who are most at risk of falling further behind. The first group of tutors starts on 1 November, and I strongly urge all my hon. Friends to ensure that schools in their constituencies are aware of that element of the catch-up programme and ensure that the vulnerable students in their area receive support.