Proposed Media Mergers

Lord Stevenson of Balmacara Excerpts

Tuesday 5th June 2018 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I am obliged to the Minister for repeating the Statement made earlier by his right honourable friend the Secretary of State in the other place. On the decisions announced today, the best thing that can be said is that they are not unexpected. Comcast cast a shadow, but not as long as that of 21st Century Fox or indeed the Murdoch Family Trust. The key issue raised today is the question of what undertakings would be accepted to ameliorate the CMA finding that a Sky-21st Century Fox merger is likely to operate against the public interest on media plurality concerns. I do not disagree that divestment of Sky News to a suitable third party such as Disney is the least worst of the available options, provided that appropriate remedies are put in place to assuage media plurality concerns.

The CMA report sets out some draft terms for such a divestment and Fox has indicated that these are acceptable. However, the Statement makes it clear that more work is required on this issue and we will want to scrutinise carefully what is finally proposed, to ensure that Sky News remains financially viable over the long term, is able to operate as a major UK news provider and is able to take its editorial decisions independently, free from any potential outside influence. Will the Minister confirm that Parliament will be kept informed of progress in these negotiations?

In the conclusion to his Statement, the Secretary of State says that the Government have followed,

“a scrupulously fair and impartial process, based only on relevant evidence and objectively justified by the facts”.

I was glad to hear that. As required by the Enterprise Act 2002, the Secretary of State has been operating in a quasi-judicial role and I accept that both he and his predecessor have been punctilious in following that approach. However, if we are reaching the end of this complex process, does the Minister accept that if,

“we want to see a broadcasting industry in Britain that is strong and effective and competitive”,

as the Statement has it, we need urgently to review whether we have the right regulatory structure and statutory powers in place for the modern world?

Does the Minister agree that there are aspects of the public interest test on media mergers which now need to be reconsidered? Many of the powers are found in the Communications Act 2003, which first brought in the public interest test for media mergers. Fifteen years on, the media landscape has greatly changed and with it comes the need to review, strengthen and future-proof this important legislative measure. We need to widen the definition of “media enterprises” to which the public interest test refers. Currently, the definition does not include enterprises such as Google, YouTube, Facebook, Twitter, Snapchat and others. Nowadays, many people take more of their audio-visual content off YouTube than from conventional broadcast channels, or they seek their news through Twitter or from apps on smartphones and thus not necessarily through broadcast platforms and channels. If the public interest can be engaged by the dominance or inappropriate control of a broadcast channel, why is it not engaged by the platform or channel through which large-scale news-related and other material is delivered to the whole population?

Ofcom needs the same powers when carrying out its Enterprise Act competition functions as are currently available to the Competition and Markets Authority, and specifically the power to require the attendance of witnesses and the production of documents. Without these powers, Ofcom is playing second fiddle. We need to think harder about the fit and proper test itself, which is currently couched as the,

“commitment to the attainment in relation to broadcasting of the standards objectives”.

However, these standards relate only to television and radio services. We need to think about how a commitment to the attainment of standards can be evidenced through the control of media enterprises that are more widely construed. This test would eliminate the risk that behaviour outside the scope of television and radio, and beyond the specifics of the broadcasting standards code, would not be able to be drawn in aid in determining fitness. Presumably we are also thinking about the question of control over other channels, newspapers and organisations. I also think that we could learn from the experience of the “fit and proper test” in other sectors such as financial services.

Finally, we need to think harder about how to protect the editorial freedom of the news services of media enterprises and see that safeguards are in place. Media plurality—the plurality of ownership—does not necessarily mean that editorial freedom is protected and safeguarded.

[Lord McNally (LD)]

My Lords, I thank the Minister for repeating the Statement. For someone who is not always clear on these great battles, where does this put the Comcast bid and the Fox-Disney bid? Are they now parallel bids and will Sky shareholders now decide which is the best deal? I read somewhere that Sky has advised its shareholders that it no longer stands by an earlier recommendation to accept the Fox bid. Once the procedure has been gone through, will it be a straight fight on price for Sky or are there other considerations?

I associate myself with what the noble Lord, Lord Stevenson, has just said: this keeps on happening. No other country in the world would allow important parts of its media industry to be fought over by foreign interests in such a way. We have here a battle between three massive American media conglomerates over a key part of our media industry. Moreover, as the noble Lord has just said, all this is being done in the long shadow of even bigger technology companies that may be coming in. We need a framework of defences for this key sector. As we said when we considered these issues 20 years ago, we are not talking about tins of beans. When these companies pass on to different control, we are talking about an essential part of a functioning democracy. There is a case for looking at the powers of Ofcom and the CMA and the Government’s responsibilities in this media area, which are badly in need of an overhaul.

The only other thing I have to say is that it is important that we get the decision right. I am always worried when the Secretary of State gives himself timetables of 15 days, or whatever. The important thing is making sure that we get it right. I also underline the importance of Parliament being kept fully informed and consulted on decisions that are taken.

Data Protection Bill [HL]

Lord Stevenson of Balmacara Excerpts

Ping Pong (Hansard): House of Lords
Monday 21st May 2018 Lords Chamber

[Earl Attlee (Con)]

My Lords, although it is perfectly correct to debate the Government’s Motion to agree with the Commons, I am not convinced that it is a good idea even to debate a further Lords amendment in lieu at this point. As my noble friend Lord Cormack pointed out, we are out of time. I agree with my noble and learned friend the Minister that the Bill is good enough and, if there is a vote, I will support the Minister.

I share the worries about the new role of the Secretary of State but unfortunately I do not think that it is an appropriate role for the Press Recognition Panel. The PRP has a very specific role, which is to test whether the approved regulator meets the standards laid out in the royal charter.

The House will be pleased to hear that I have cut out seven minutes of my speech. Nevertheless, I will be engaging with my noble friend Lord Black of Brentwood to explore how we can achieve what we all want: a free, vibrant, sustainable, competent press that adheres to the rules and acts decently, but which cannot be chilled by a very rich complainant.

[Lord Stevenson of Balmacara (Lab)]

My Lords, the test has been given to us: we have to assess whether or not this Bill is good enough to pass. It is not the test I think we were expecting. It is quite refreshing in some ways because it means we do not have to look at every jot and every tittle, every “i” and every “t”, to make sure they are correct—we can just say that it is good enough so go with it. I am not sure it is the test that will sustain in your Lordships’ House for time to come, and perhaps we can draw a veil over it once we have got through this short period.

Is the Bill good enough to pass? Yes it is, and I have no doubt that it will pass today. However, it leaves behind two or three unanswered questions and some substantial issues that we will have to come back to. I think we have heard enough in the speeches today to know that these issues are not finally vanquished: they are present and they will be back, and we should think about that. If we wanted any assurance that this goes across all parties, all disciplines and all times, the speech by the noble Lord, Lord Fairfax of Cameron, put us absolutely on the spot. There is a sense that a great injustice has happened and a sense of fairness among UK citizens to want to see it organised better and done again. There was an all-party consensus—the evidence is that there still is an all-party consensus—that we should do it.

This was not the right Bill—I always said that it was not—but we have made huge changes to the way in which the Government were proposing to legislate in this area, changes which I welcome. Victim of the timing as we are, if there had been more time available, we perhaps could have sorted out many more of them. But we are not going to be able to do that because we must get the Bill through before midnight on 25 May. I absolutely subscribe to that.

What is left to do? There is no doubt that we have to know more about who did what to whom in the period running up to the Leveson inquiry being announced in November 2011. My Amendment A2 would have given the Information Commissioner powers to look at that and to provide what would effectively be a benchmarking report to allow subsequent work “looking forward”—in the words of the Secretary of State—to have a proper sense of what it was they were testing. I still think that that would be the right solution, but the noble and learned Lord made some welcome remarks from the Dispatch Box at the beginning of the debate and I accept those as being sufficient to make sure that I can withdraw the amendment at the appropriate time.

There is the narrow question of whether we should look at the particular points raised in the two other amendments. I think they are victim to the problems that we have had with this Bill, in that we have not been able to give detailed scrutiny in Committee or on Report to issues that we perhaps should have done had they been around. It is good that they are there and that the Government have listened. It is fantastic that they are prepared to work with us on these issues; much of the wording here has come out of discussions and debates with Ministers outside the House, and we have seen the benefit of that.

However, Amendment 62BC as proposed by the noble Lord, Lord McNally, worries us, and my noble and learned friend Lord Falconer made the point very well. It states:

“The Secretary of State must, before the end of each review period, lay before Parliament a report produced by the Secretary of State or an appropriate person on … the use of relevant alternative dispute resolution procedures … and … the effectiveness of those procedures in such cases”.


That goes a bit too close to whether it is politicians—the Secretary of State in this case—directing how independent assessments should go forward. I would be grateful if the noble and learned Lord could comment on that. It may well mean that the Secretary of State has the power but the actual work is done by others and, as was always going to be the case, that it is just a report and not a review. The confusion comes, I think, from having “review period” specified in the Bill, which is something that we would have picked up earlier.

On my noble and learned friend Lord Falconer’s amendments, there are issues around whether we are, in some senses, giving a responsibility to the Information Commissioner but not the powers to do the job that we want done. Again, some words from the Dispatch Box might help. I have covered my Amendment A2, in the sense that I think that responses have come back.

Is there a future for work in this area? Yes, there is. IPSO has made a significant change to its working practices since it was established and is now doing good and effective work. I do not disagree that the right thing is to let it continue on its path, watch how it goes and look at the reports that will be made on its effectiveness under Amendment 62BC.

We should not be tempted to change the structure of the PRP and its approval of independent press regulators. It may seem otiose but, as there are now 100 titles signed up to it, at least it is doing something right. As the noble Lord, Lord McNally, said, that system may well have something to offer Facebook, Google and others who might be interested in making sure that they are properly regulated.

Given that we are looking forward and the worry that we have in a liberal democracy of being able to see the kind of quality press and comment that we have in our present print journalism, which I support entirely, the review being carried out by Frances Cairncross will result in a number of recommendations and it is possible that we will need to legislate for that. These issues could come back relatively soon and I hope they do. There is enough all-party support in this House and the other place to get some movement on that and we will be happy to do so. For the moment, we wish the Bill well. It is good enough and we hope it will come into force and do the job it is meant to do.

Media: Press Sustainability

Lord Stevenson of Balmacara Excerpts

Thursday 22nd March 2018 Lords Chamber

Asked by

[Lord Stevenson of Balmacara]

To ask Her Majesty's Government whether the recently launched review of press sustainability in the United Kingdom will have the power to call for evidence; whether all such evidence received will be published; and whether all meetings held as part of the review will be public.

[The Advocate-General for Scotland (Lord Keen of Elie) (Con)]

My Lords, the Cairncross review into the sustainability of the national and local press is being led by an external chair, Dame Frances Cairncross, with support from an advisory panel. It is not a statutory inquiry and will therefore not have the statutory powers to compel witnesses to give evidence, nor will it be required to hold meetings in public. Dame Frances will determine the process for gathering evidence in due course.

[Lord Stevenson of Balmacara (Lab)]

I am obliged to the Minister and congratulate him on his ability to switch effortlessly from subject to subject overnight; it is almost legendary. I welcome the review, and congratulate the department on its distinguished choice of chair and on assembling what looks like a knowledgeable and expert advisory panel. I am sorry that the evidence is not going to be published automatically and that the hearings will not be in public, but I hope that the chair will see the wisdom of doing that and look forward to seeing how events develop. Does the Minister agree that, given that the aim of the review is to secure high-quality journalism, the remit is oddly framed with its focus on the market environment and on consumers rather than citizens? Given the recent news, will he confirm that section 1.5 of the remit will allow the review to investigate and report on the ways in which social media have clearly been influencing opinion ahead of elections and referenda? If not, who will look at that?

[Lord Keen of Elie]

My Lords, the review will examine the role and impact not only of digital search engines but of social media platforms and other digital content aggregation platforms which have an impact on press sustainability.

European Union (Withdrawal) Bill

Lord Stevenson of Balmacara Excerpts

Committee: 9th sitting (Hansard - continued): House of Lords
Wednesday 21st March 2018 Lords Chamber

[Lord Griffiths of Burry Port]

While I will have a word to say in a moment about the use of the word veto, I will not claim to know the detail relating to the Council of Europe, to which reference has been made.

[Lord Stevenson of Balmacara (Lab)]

It was the Council of Ministers.

[Lord Griffiths of Burry Port]

I beg your pardon. I think the mistake is evidence of the fact that I am not qualified to answer that particular part of the noble Lord’s question.

--- Later in debate ---

[The Earl of Kinnoull]

I am very grateful to the noble Lord for making a jolly good point very well. At the lunch, that was hinted at, with rather less force. I wholly accept his reasoning and agree with what he said.

[Lord Stevenson of Balmacara]

I join many noble Lords in congratulating the Government on the way they have handled this issue and reinforce what was said by the noble Lord, Lord Forsyth: I have not seen any such movement from any Government in my time here in terms of trying to reach out to the points being made and accommodate them. That is terrific; long may it last. The test will be whether the noble and learned Lord in fact withdraws his amendment before the end of tonight—but I trust him in this case.

I also think that the idea of a probing government amendment is pretty good. It is nice to know that there is an open mind on the other side, and no better way of showing it than saying: “We haven’t got the faintest idea here, but here’s something you might want to consider and discuss and we will listen hard and take away the best bits”. It is good in the sense that it builds trust and engages debate. We have had a terrific debate—possibly a little overlong, but it has been very interesting—and I am sure that many points will take us forward. I recognise that the idea of probing your own ideas may not work unless we can actually come up with some ideas, so it behoves us all to think very hard about the advice that we want to give to the noble and learned Lord and his colleagues.

What do we want? There are five things that I would like to see in revised amendments. We should be looking for an agreed amendment among the various interests around the House as much as possible. There has been enough evidence about where the central points are—we may differ on the nuances, but there is enough there. It would be really good if we could have some informal discussions and meetings before Report—and Third Reading, if it goes that far. By that stage, I hope that we will have a firmer view of what we are going to do in Northern Ireland. I agree that the situation is beyond the power of this House to do anything about, but it is a real gap when we are trying to address our longer-term constitutional position. If we have nothing to say, that says more about us than about the situation in Northern Ireland. I hope that that will be taken into account.

My first point is a negative. The Bill has raised debates, ideas and thoughts that are really important, but they are far too time-rich and need more discussion before they go into the Bill. The Bill is at heart limited to ensuring that we have a legal framework if and when we leave the EU—as the noble and learned Lord said, a fully functioning statute book. We are wrong to try to overload it with too much. I hope that, in offering our advice either privately or in meetings, we will focus on the minimum necessary to get the Bill on the statute book in a way that will be effective and efficient, and will achieve what we are trying to do.

On the other hand, the debate should not be curtailed by the question of what is and what is not in the Bill. We must accept—some noble Lords were ahead of me on this point—that transfers of this amount of responsibility to admittedly mature Parliaments and Assemblies will start a new chapter in the devolution story, and it would be remiss of this House if we did not think through some of the implications of that.

I have no particular remedies here, but it is inconceivable that the current arrangements, under which we determine through a Board of Trade how we conduct trade policy, can accommodate the new arrangements. They will have to be expanded and thought through again. We will have to think about how we deal with treaties and how our ongoing relationship with the EU and its regulatory and other official operations will continue in a devolved situation where trade responsibility and policy is at a level other than national. There may well be a set of rules that will accommodate that. They will not fit into this Bill, but they need to be considered as we go forward.

We have to think also much wider—certainly much wider than this idea that somehow this paves the way to independence for any or all of the parts of the United Kingdom. We have to think about the opportunities that will exist as these things are devolved in terms of such matters as what happens to state aid rules when they are changed. This will raise a lot of concern and interest much more widely than in this House. We will do ourselves a disservice if we do not take that into account as we think this through. For the moment, though, let us think very narrowly about this Bill.

At the heart of it, we want an agreement that, on the face of the Bill, the underlying principle in play is that everything is devolved unless it is reserved. We also want a clear understanding of why certain things are reserved. The noble and learned Lord, Lord Mackay of Clashfern, gave a very good example of one way into this argument by saying that it was a question of when powers were in consideration which applied in more than one geographical area; however, I put it to him and to the Ministers who are working on this that this is not quite the full story. If you look at the note on the common frameworks that accompanied the full list of them, it goes much deeper than that. These are principles, as I understand it and as I think the noble and learned Lord confirmed, that were agreed by the UK, Scottish and Welsh Governments at a meeting of the Joint Ministerial Committee in October 2017, so they are not in dispute. The principles make clear that,

“common frameworks will be established where they are necessary in order to: … enable the functioning of the UK internal market, while acknowledging policy divergence;”

—the coda about “acknowledging policy divergence” is really important, and we need to know more about that—

“ensure compliance with international obligations;”

—I think that is fairly clear—

“ensure the UK can negotiate, enter into and implement new trade agreements and international treaties;”

—I have already said I do not know whether that will necessarily be the only way into that debate—

“enable the management of common resources;”

and then two rather important issues that we have not touched on but that surely have to lie at the heart of this:

“administer and provide access to justice in cases with a cross-border element;”

and,

“safeguard the security of the UK”.

It has always been the case that national security is the primary concern of all governments, but surely that plus the geographical “bite”, as indicated by the noble and learned Lord, give us—together with the other points I have raised—a much richer context within which the decision to reserve an item can be placed. It is important that this is on the face of the Bill. That is the key issue. There must not be a sense that something has been hidden or held back. We have to be open and trust those who are concerned about this that this will be the way forward. I hope that when the Minister comes to respond, he will be able to confirm that this is an issue that he might look at with some sympathy, because I think it will be the key to it.

I also think, as suggested by the noble and learned Lord, Lord Wallace of Tankerness, and others, that we should see the 24 policy areas included as a Schedule to the Bill. The point made by my noble friend Lord McConnell of Glenscorrodale is very important: we are talking about those things that will have to be reserved for a reason. We should list them, and we should also understand the reasons why they are reserved.

There are two smaller points—in the sense that they are less full of implications; they are still very important—that I will tag on to the end of this. The noble and learned Lord, Lord Hope, raised a number of points that will need to be picked up and that we must not forget, because the change to the existing Clause 11 will affect other aspects of the area. He made that point well. There have also been calls from all around the House for a sunset clause, which I absolutely support. That is the right thing to do. If that all comes together, however—and I think we are confident that it is possible—what we are signing up to is an agreement to agree on process, but that agreement will be able to get the consent of the devolved Administrations. That combination is vital to the way forward, and I recommend it very strongly to the Ministers.

Finally, if we are going to avoid the veto problem, which I think is a real issue that we have not really bottomed out, we are going to need a dispute resolution mechanism. There is no doubt about that. You cannot just go into this hoping that it will somehow be all right on the night. We need to know what happens when one area, for whatever reason—whether it is a political reason or truly an issue of conscience—wants to put down a veto and hold out. I do not think there has been any dispute, but we have not said it enough: at the end of the day the UK Parliament has to have a backstop power to legislate in cases that meet the criteria for why things are reserved. I think we should keep saying that until it has become part of the fabric of our lives. It is not said enough, as the noble Lord, Lord Lang of Monkton, mentioned.

But we also need to achieve the consent that is necessary to establish the agreements that will underpin trust and support for this in the long run. I absolutely think that the amendment proposed by the noble and learned Lord, Lord Mackay, has something in that regard. I am grateful that the Minister has said that he will take this away; we need to workshop it—what we should have is a hackathon—in order to work out together where we might go with it.

[Noble Lords]

Minister.

Leveson Part 2: Sunday Times

Lord Stevenson of Balmacara Excerpts

Wednesday 7th March 2018 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, the shocking revelations some of the press and other media earlier today about allegations of blagging commissioned by the Sunday Times are, in the words of the Secretary of State,

“totally unacceptable and potentially criminal”,

and the right thing is for them to be investigated by the police. However, the key issue is that the Secretary of State has refused to reconsider the decision to close the Leveson inquiry. Let us be clear: this decision was not supported by the vast majority of those who responded to the public consultation and it was strongly opposed by the chair of the inquiry, Sir Brian Leveson, whose letter is available in the Library.

I say again to the Government that letting down the victims of this type of press activity is breaking all the promises they were given, and is a disgrace. In light of this, I wonder whether Minister can explain why it is not in the public interest to complete the Leveson inquiry, given that, far from being an isolated event from a previous age, today’s revelations confirm that phone hacking and other criminal behaviour was more widespread and affected a wider range of individuals than was disclosed in the written evidence given to part 1 of the inquiry, and that some of the oral evidence given to the inquiry was, at the very least, incomplete, so that, in Sir Brian’s words, it,

“remains unclear exactly how widespread these and similar practices have been throughout the print media”.

It may be that this sort of behaviour has ceased but it is in the public interest to be certain about that. Neither Leveson part 1 nor the civil or criminal trials have provided definitive answers about who did what to whom. Sir Brian suggests that the public interest would be served only by,

“a detailed, reasoned report which covers the whole of the available evidence”.

While there is much about the new press regulator—IPSO—that can be welcomed, the Secretary of State indicated in the other place today that more needs to be done in terms of IPSO’s as yet untested low-cost arbitration system, and in relation to the way apologies and retractions are dealt with. It is surely in the public interest to get this right so that victims of press intrusion can actually get the redress they so patently have not had in the past. Although included in the original terms of reference, there has been no proper investigation of failures of corporate governance and management at News International and other newspapers.

On how to go forward, we currently have two press regulation models, and that is clearly unsustainable. Voluntary self-regulation may well be the right approach, but it will not work unless there is public confidence, particularly when so much has been revealed about wrongdoing, including the events occurring after the publication of the first Leveson report.

When he announced last week that he was dropping the Leveson inquiry, the Culture Secretary said that he was doing do so because he felt the public interest lay in looking forward. I still believe that there is more that unites us on this than divides us. We all want a review of the future of quality journalism and for there to be an assessment of what is required to sustain that for the benefit of our democracy and polity. Where we differ is that we think that the public interest demands that the new inquiry should start with an examination of the recent history, culture and practice of the press, police and politicians. The Government clearly want to draw a veil over that. They should be very careful, particularly when they think they are acting in the public interest.

[Lord Keen of Elie]

My Lords, the Government have to take decisions about what is proportionate, appropriate and in the public interest. Our analysis is that the terms of reference for part 2 have already largely been met and that the cost and time of part 2 would be disproportionate and not in the public interest.

Leveson Inquiry Update

Lord Stevenson of Balmacara Excerpts

Thursday 1st March 2018 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I am very grateful to the noble and learned Lord for repeating the Statement made by his right honourable friend the Secretary of State for—is it D2CMS? I forget how you pronounce it these days, with “digital” being added to the department name.

We need to consider three main issues addressed in the Statement. First, this announcement of the Government’s formal decision, albeit it was prefigured in their manifesto, terminates the Leveson inquiry established under the Inquiries Act 2005. It also gives notice that the Government will repeal Section 40 of the Crime and Courts Act 2013. But we gather from the Statement that Sir Brian Leveson, who has rightly been consulted about this, agrees that his inquiry should not proceed but believes that it should continue in an amended form.

But is that what is happening? Could it be, as was patently clear from the huge response to the consultation carried out by the Government, that Sir Brian believes that there are still many unanswered questions? Do they include which editors and other senior newspaper executives were commissioned or otherwise responsible for data theft, phone hacking and other illegal conduct by journalists and investigators? Does it cover the full extent of hacking and data protection breaches at certain national newspapers, the extent of alleged corruption between some politicians, media representatives and the Metropolitan Police, and the nature of the relationships between the police and the press, in particular the long-term cover-up of police responsibility for the Hillsborough disaster?

The Statement gives the impression that this has all been sorted. It says that,

“the terms of reference for a part 2 of the inquiry have largely been met”.

Well, I do not think that Sir Brian agrees with that—or that the victims will agree with it. I certainly do not. It would be very helpful for your Lordships’ House if the noble and learned Lord could explain what precisely the words used by Sir Brian meant in that enigmatic phrase that he believes that the inquiry should continue in “an amended form”. Will he put copies of the correspondence in the Library so that we can all see it?

Secondly, on Report on the Data Protection Bill your Lordships’ House voted by 238 to 209 to add Amendment 127A in the name of the noble Baroness, Lady Hollins. This new clause effectively requires the Government to proceed with a second part of the Leveson inquiry. The House also agreed amendments in the name of the noble Earl, Lord Attlee, which replicate Section 40 of the Crime and Courts Act for data protection claims only.

It is possible that the Government will find the arguments—I have every confidence that we will listen to them with great interest—that will persuade the other place to remove these two amendments, but the parliamentary arithmetic being what it is, I am not sure that that is certain. In any case, if the amendments are reversed, they will come back here on ping-pong under considerable time pressure. After all, the Bill has to have Royal Assent by 25 May. Could the noble and learned Lord speculate about what might happen on the assumption that the Bill remains unamended? Perhaps we should explore the common ground here, because there is potential for working together on this. I look forward to discussions that were started prior to discussions on the Data Protection Act.

Will the noble and learned Lord also explain what the timetable is for the repeal of Section 40 of the Crime and Courts Act? The Statement says that it will not be commenced—again, that was in the Conservative manifesto—but the Statement adds that the Government will seek repeal “at the earliest opportunity”. When is that? “Soon” and “before Christmas”, which are the usual words in the lexicon used by the noble and learned Lord, will not be sufficient on this occasion. I look forward to more detail.

Thirdly, the saddest thing about this Statement is that it makes it clear that the all-party consensus that informed the Leveson report and oversaw the parliamentary process immediately after its publication has been destroyed. The Conservatives have reneged on the promises made by successive Prime Ministers not to let down the victims of press intrusion, and they are clearly setting their face against ensuring that we learn the lessons of the past. It is a disgrace that the Government are betraying the trust placed in them by the victims. Who now will stand up for them and make sure that their pain and suffering will not be repeated?

I believe that there is a willingness in Parliament to encourage an independent system of press regulation, as recommended by Sir Brian Leveson. I will go further: I am sympathetic, and I think others are, to the idea that if IPSO would clearly meet the standard for recognition establish by the PRP, it might be sensible for Parliament to revisit the complex set of interrelated measures of inducements and penalties set up under the rather baroque arrangements of the Privy Council.

Alongside this, we need to take into account the parallel developments mentioned in the Statement. Mainly because of loss of sales and the collapse in advertising revenues, the traditional press is in serious decline. The new, unregulated electronic sources of news and information are growing rapidly and the internet is constantly innovating and expanding news, fake news and other services. I agree with the Secretary of State that one result of these trends is that we may be witnessing the end of a fine tradition of serious journalism and the elimination of space for independent opinion which has always underpinned our democracy and polity in the UK. I agree with him that this is really important.

I welcome the proposal for a review of the sustainability of high-quality journalism and suggest to the noble and learned Lord that there may be considerable advantage in making the review cross-party and ensuring that its evidence and proceedings are open to the public. Perhaps he could comment on that—and if he cannot do so now, will he be ready to respond to an Oral Question on this later in the month, of which I have given him some notice?

If this marks the end of Leveson—and I echo the thanks expressed by the Secretary of State to Sir Brian for his considerable efforts—I am left with the following thoughts. The key question raised by Leveson is how in a democratic society we enshrine the press’s freedom to publish in the public interest while ensuring a proportionate balance so that individuals retain their rights to privacy and the security of their personal data. We have not got this right yet, but I do not think that we are far away from coming to a proper solution.

We must learn the lessons from the culture of abuse, illegality and criminality that has flourished for too long in our newspapers. There is no point in trying to cover over that and not look at it. We need to examine all these things and come up with reports—and we have to make sure that the victims of press intrusion can get effective redress when such abuse happens.

As I have said, there is more that unites us on this than divides us. Now would be a good time to reach out to all parties and attempt to re-establish the cross-party agreement that led to the original Leveson report and ensure that its good work is carried on.

[Lord McNally (LD)]

My Lords, it is never a pretty sight to watch a Government capitulating to vested interests. At such a time, it is always useful to look around and see who is smiling. Certainly, Mr Rupert Murdoch will be smiling, as will Lord Rothermere, Mr Paul Dacre and the Barclay Brothers—owners or editors of the Times, the Sun, the Mail and the Telegraph respectively.

It was nearly 30 years ago, in 1990, that the Calcutt commission recommended the setting up of a Press Complaints Commission. The Government of the day welcomed that report and set up the Press Complaints Commission, but warned that it was a “final chance” for self-regulation, or, as the then Secretary of State, David Mellor, put it, the press were,

“drinking in the last-chance saloon”.

The trouble is, what has happened since? There was no learning of lessons or improvement of behaviour, with the addition of corruption and criminality to the cocktail of press failings under the stones that Lord Justice Leveson turned over.

This Statement is littered with high-minded declarations, such as,

“free to … investigate without fear or favour … underpin our democracy … integral to the freedom of our nation”,

and,

“safeguard the lifeblood of our democratic discourse”,

but the truth is that none of those high-minded aspirations would be put at risk either by implementing Section 40 or by continuing with part 2 of Leveson. They are put at risk by behaviour that undermines public trust and diminishes confidence in our democracy.

Will the Minister clarify a number of points? First, will he put in the Library of the House the precise terms on which Sir Brian Leveson believes his inquiry should have continued? Secondly, when will the terms of reference and chair for the new review into the sustainability of the press be announced? Will it be that review or Ofcom that looks at the increasing overlap between print journalism, online journalism and broadcast news, which now sits with the various oversight bodies that regulate them?

The sentence in the Statement with which I agree entirely states that challenges that were only in their infancy in 2011 have now to be faced. Issues such as misinformation, fake news, malicious disinformation and online abuse all threaten both the quality of journalism and the fundamental rights of our citizens.

But this Statement is not a response equal to that challenge. For all the crocodile tears, it will do nothing to preserve local newspapers. It leaves the victims of press abuse with their hurt still raw and unassuaged by any sense of justice done. It was very interesting that a few hours after the Manchester bombing, journalists were knocking on the doors of victims, intruding into the private grief of people who had lost their children that night. So much for conscience and regret.

It leaves a self-serving regulator, IPSO, which is as ineffectual and compromised as its predecessor, the PCC. As the noble Lord, Lord Stevenson, said, it is open to IPSO to come within the Leveson recommendations, and if there were any sense of trying to meet the all-party approach that the noble Lord, Lord Stevenson, advocated, that is what IPSO would do. It leaves our media landscape not, as it should be, a balance of quality, diversity and choice, but again simply an accident waiting to happen, as those guilty of past abuse remain in power, with no sense of contrition or shame, and there is still no effective means of holding the perpetrators of that abuse to account.

It is not even an outcome of the consultation. It is the fulfilment of a squalid political deal between the press barons and the Conservative Party which the Secretary of State will live to regret. What is certain is that the name of Leveson will rank higher in the list of defenders of freedom of the press than any member of this Government.

Sky-Fox Update

Lord Stevenson of Balmacara Excerpts

Tuesday 23rd January 2018 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I thank the noble and learned Lord for repeating the Statement made by the Secretary of State in another place. I take this opportunity to congratulate Mr Matt Hancock on his appointment and pay tribute to the fact that, on this issue, he says he intends to continue his predecessor’s practice of being as open as possible while respecting the quasi-judicial nature of the decision. In this regard, I respectfully request that the Minister suggests to the new Secretary of State that he might wish to continue the informal all-party meetings with Members of your Lordships’ House, which were very helpful in previous rounds of this and related issues. We would welcome that.

As we have heard, the provisional findings of the CMA are that if the Fox-Sky merger went ahead as proposed, it could be against the public interest. It would result in the Murdoch family having too much control over news providers in the UK and too much influence over public opinion and the political agenda. I do not think that there can be much dispute about that. We now move on to a public consultation of possible remedies, which I am sure will attract a great deal of attention, as did the original investigation, with some 16,000 responses.

The Statement that we have just heard did not, for obvious reasons explained by the noble and learned Lord, go into the detail of the possible remedies, but I think it is worth commenting that, even at this stage, it is fairly clear that the CMA largely discounts what are called “behavioural remedies”, which are largely firewalls aimed at keeping entities and their information separate within a merged group. We agree that that would not be a preferred solution. Secondly, the CMA is unenthusiastic about structural remedies; namely to either spin off Sky News into a new company, or recommend the divestiture of Sky News, as this may threaten the viability of Sky News. This is something that has already been threatened: indeed, it is interesting to note that the CMA warns parties that the closure of Sky News while the investigation is ongoing would not be permitted. We are left, therefore, with the third recommendation which is out for consultation, which is the prohibition of the transaction. We think that that is the right solution.

Clearly, a lot of this is dependent on whether and when the sale of Fox to Disney goes ahead. It is subject to considerable regulatory issues in the United States and we do not know enough about what the final structures will be; we therefore have to wait. It is a complicated issue on its own without these other factors intervening, and it is good that the CMA seems to be on top of this, keeping a watchful eye on it and making sensible proposals in the eventuality of this coming through within the timescale of its review. The most surprising issue in the Statement is that the CMA says it is not concerned about the proposed merger on broadcasting standards grounds. I make two points here.

We have argued consistently that the fit and proper person test of individuals who seek to acquire and operate a broadcasting licence is central to having a fair and plural press in this country. However, the test itself is flawed and outdated and needs to be revised. I refer the noble and learned Lord to amendments to the Digital Economy Act which we debated in the last Parliament and which we withdrew on the basis that the Government were considering amending the current provisions and would be looking at this in the near future. I do not think it would be difficult to find a way of bringing into the 21st century a system which, after all, is similar in many respects to the one routinely operated in the financial sector. Will the Government consider this? If so, will they tell us when they will bring forward some recommendations?

Secondly, we have consistently said that if we are to reach a proper assessment of the broadcasting standards question as it affects the Murdoch Family Trust and others, we need to get to the bottom of the corporate governance issues that gave rise to the original Leveson report and should be looked at again as part of part 2 of the Leveson inquiry. I am trying to be helpful here to the noble and learned Lord—I hope he will not need to be reminded that, as a result of amendments in the name of the noble Baroness, Lady Hollins, which were agreed by this House to the Data Protection Bill, the Government are likely to be required to carry out a review of this type one way or the other. Once Sir Brian has reviewed the recent consultation responses on this issue, I urge the Government to simply get on with it.

[Lord McNally (LD)]

My Lords, I associate myself with the points made by the noble Lord, Lord Stevenson, about the second stage of Leveson and also the remedies that have already been put forward on media regulation. I welcome this Statement and the ongoing commitment of the Secretary of State to keep both Houses informed. I also appreciate the continuing interest of the Minister in this House, the noble and learned Lord, Lord Keen, in the matter. Like the noble Lord, Lord Stevenson, I would welcome a continuation of that informal dialogue. We welcome the interim findings concerning the public interest not being served in terms either of diversity or the influence of the Murdoch Family Trust.

On the commitment to broadcasting standards, I share the concern and puzzlement of the noble Lord, Lord Stevenson. I find it odd that in terms of commitment to broadcasting standards, the proposed merger does not operate against the public interest, echoing an earlier and very disappointing finding by Ofcom. In three continents over 60 years—in Australia, the UK and the USA—Mr Murdoch has been a major factor in lowering standards in both print and broadcast media. I am pleased that the Secretary of State is taking his time to think and consider. Frankly, he has been a little too eager to shoot from the hip in his first few days in office, so this more considered response is welcome.

I still believe that a healthy media ecology rests on a mantra of quality, diversity and choice. All three are threatened by an extension of Murdoch power. It is important to defend the integrity of Sky News, where the lack of 100% control has mitigated against the Murdoch effect. But the Secretary of State needs to go further and consider carefully how we protect our public service broadcast news on the BBC, ITV and Sky News. We need to review the protection of news sources in the light of the impact of new technologies. Here again, Ofcom needs to be proactive in reviewing and bringing advice on these matters.

We must also keep an eye on the implications of the Disney takeover of Fox. Does the Minister have a timetable or guesstimate about how soon the US authorities will come to their conclusions? For we must make sure that any remedies to protect the public interest are real and effective, not simply fig leaves to cover up a surrender to big media power. This is a welcome Statement but it is not the end of the matter. We need a robust Secretary of State to defend the public interest but, on that, I am afraid the jury is still out.

Data Protection Bill [HL]

Lord Stevenson of Balmacara Excerpts

Committee: 2nd sitting (Hansard - continued): House of Lords
Monday 6th November 2017 Lords Chamber

Moved by

[Lord Stevenson of Balmacara]

42: Schedule 1, page 115, line 19, leave out “substantial”

[Lord Stevenson of Balmacara (Lab)]

My Lords, at Second Reading I touched on the question of whether the Bill might be used as a vehicle for rehearsing some of the arguments that we have heard in your Lordships’ House about the issues raised by Sir Brian Leveson in his report. I opined at the time, and am still of the belief, that this would not be the right place to put forward those amendments again, because I would favour an initiative from the other side of the House which tried to build on some of the work that was done in the run-up to the work that was done after the Leveson report was first published, which saw all party groups coming together to try and find a way forward. It seemed that we were beginning to get ourselves into a cul-de-sac on many of these issues. Although there were strong passions and strong beliefs, and good intellectual and other reasons for taking forward some of these issues, the times had changed and the climate had moved on. It was therefore important to try and think again about what would happen.

However, I also said that maybe others would take a different view of that and come forward with amendments on these and related issues. I expressed the view that, if they did, Her Majesty’s Loyal Opposition would look at them on their merits and respond to them as and when they came up. This explains why we have not signed up to some of the amendments that are before your Lordships’ House today.

I also said that our main concern going into Committee would be to make sure that the arrangements under which we currently operated, which were largely set out in the Data Protection Act 1998, were continued. It was very important that all concerned had confidence that the transposition between 1998 and today, and going forward to 25 May 2018, was adequate and sufficient, in terms of how we approached them in relation to that Bill. I am therefore introducing Amendment 42, which is largely a probing amendment aimed at getting Ministers on the record as to whether or not they feel that the transposition has been made fairly and effectively. To the extent that there is an addition to the existing law, as I understand that to be the case, it is in response to a particular aspect of the current regime which does not seem to work well in practice. The Information Commissioner’s Office has made it clear that it feels that it could do with an additional power, which I think is provided for in the Bill, to assist with the ability to reimburse those who have been affected by actions arising from a complaint they have taken forward in relation to the press. If that is the case, I would be happy to have that confirmed. That is the reason for Amendment 42, and I look forward to hearing from Ministers how they respond to that.

In pursuit of a perfectly normal and natural wish to scrutinise the Bill as it is before us, we have two other amendments in this group. Amendment 87B was offered to us by the NUJ, and is on a question which comes up a lot when talking about intellectual property issues relating to photography—not that this is actually about that, but journalism has a common-sense meaning which is often used in language other than that of Bills to reflect all aspects of journalism, including photojournalism. But of course it is not the totality of what photographers do, so this amendment is an attempt to get on the record what Ministers believe to be the sense on page 136, in Part 5, where paragraph 24(2) states that GDPR provisions do not apply,

“to personal data that is being processed only for the special purposes to the extent that … the personal data is being processed with a view to the publication by a person of journalistic, academic, artistic or literary material”.

Given the absence of the term “photography” or “photographer”, I have a slightly rhetorical question, but one to which I am looking for an answer. Can I assume that the sense of that paragraph is that this would catch photographers?

If that is the case, since photography is often done in a way that would not always result in publication, could we have clarity about the situation if the photographers were to rely on this provision in relation to material? Say, for instance, they were taking a number of photographs of a demonstration, some of which would be used but a lot would not be, and then it was felt that there was some other purpose that those photographs could be used for—that was an example given to us by the NUJ. It was concerned that the photographer should not be discriminated against, in the sense that the work of building up a personal archive of photographs taken on the job that did not result in specific publication might not necessarily fit particularly well with that. This is just a probing amendment to see what the response to that is.

The other amendment in our name in this group is Amendment 87E, relating to an issue that has been raised by others in this group. There is what I think is meant to be a transposition from the Data Protection Act 1998 to refer to the question of whether or not the public interest is engaged, and various rules and regulations around that. The notion behind our amendment is that we are not sure it is helpful nowadays for the legislation to refer in specifics to a list of codes and practices, particularly because one of those—I reference paragraph 24(5)(c)—is not correctly described. I think others will speak to this as well. Obviously there is a code of practice that editors of major newspapers have contributed to and which works reasonably well in practice, but the danger about that as an example is that it cuts out a lot of other codes of practice that could easily be mentioned there. Having them there does not seem to advance the argument, which is that the controller must have regard to appropriate codes of practice or guidelines that exist. In the event that any question is raised by the Information Commissioner or others, it is more appropriate for that to be left more general than specific. With that, I look forward to the responses. I beg to move.

[Baroness Hollins (CB)]

My Lords, I will speak to the amendment in my name. I am grateful to the noble Earl, Lord Attlee, who has added his name in support. I will also speak in support of the amendment in the name of my noble friend Lord Skidelsky.

First, I want to explain why the Bill in its current form does not provide an adequate balance between privacy and freedom of expression, despite claims to the contrary by some parts of the media this weekend. Freedom of expression is essential to hold power to account and to expose wrongdoing, and it must be protected. However, the public also need to be protected from those who might seek to abuse such freedoms with the primary business purpose of selling newspapers.

The need for balance was recognised by Lord Justice Leveson in his 2012 report, and these amendments seek simply to implement some of the Leveson recommendations on data protection. It is worth remembering how some newspapers exploited private data in the past. Operation Motorman was a lengthy police investigation. The Information Commissioner reported on it in 2006, detailing the kinds of information that private investigators were buying unlawfully or obtaining by deception, including bank records, medical records, tax records, benefits records, phone records—thousands of transactions obtained from just one private investigator and commissioned by journalists. The victims whose data had been illegally accessed were not celebrities or public figures being investigated for genuine public interest reasons. They were just ordinary people with tenuous connections to those in the public eye: the sister of a well-known MP’s partner; the mother of a man once linked romantically to a “Big Brother” contestant; the decorator who had once worked for a lottery winner; and the GP who was doorstepped by a Sunday newspaper in the mistaken belief that he had inherited a large sum from a former patient. All these were victims of data misuse, and we are still learning how widespread those practices were.

Some argue that that is history and that newsroom practices have changed since the Leveson report, but the economic pressures which drove newspapers to desperate practices before are even more acute now. Many of the same editors and senior executives are still in place, and many in this House will remember similar promises of reform made by newspaper editors in the wake of the Calcutt report nearly 25 years ago. Does the Minister agree that this time, it is our responsibility to act decisively to protect the public from the less scrupulous elements of the press?

There is an exemption in the Data Protection Act 1998 for journalism, and this is reproduced in the Bill, but the exemption as drafted effectively offers a blank cheque to publishers and would allow them to breach data rights with little protection for the public from abuse. The GDPR is clear: exemptions should be made only when they are necessary to reconcile the right to protection of personal data with freedom of expression. My amendments are designed to ensure that this balance is properly preserved. They have been drafted by a senior QC and are based on recommendations made by Lord Justice Leveson, himself an independent senior judge, after a public inquiry in which he heard evidence and arguments from all sides, including the newspaper industry. I should declare an interest here and remind the Committee that I gave evidence to the Leveson inquiry.

--- Later in debate ---

[Lord Keen of Elie]

Let me elaborate on the point for a moment to make it clear. IPSO did not exist in 1998; the editors’ code did and therefore the editors’ code was incorporated as such by reference to the 1998 Act and the 2000 order. The relevant editors’ code is now known as the IPSO code. It is essentially the same code, as I understand it. I see that the noble Lord, Lord Stevenson, is shaking his head on this point, but it is essentially the editors’ code that is now incorporated within the IPSO code.

[Lord Stevenson of Balmacara]

I could not resist jumping up. I think the nub of the argument is the four letters IPSO. It is an editors’ code. IPSO is a separate body. I think there would be less concern if it were just simply the editors’ code because we understand what that is. That would be the right reference, but I think we will return to this later.

[Lord Keen of Elie]

The terms of the editors’ code are now referred to as the IPSO code, but I take the noble Lord’s point and I will take away and consider whether there is any material issue about using the designation of that code in the schedule. However, it is, with respect, essentially the editors’ code as it was originally recognised. As I understand it, that is reflected in the Information Commissioner’s current guidance under reference to Section 32, which is why it appears in the schedule in the form that it does.

--- Later in debate ---

[Lord Stevenson of Balmacara]

My Lords, this has been a very interesting debate. It has lasted one hour and 25 minutes and there is a little more to go. The hour is late and I do not think one wants to rush to judgment on the many important things that have been said today. As I am sure many other noble Lords do when faced with such an intense and important debate, I want to reflect a little on it, read what it looks like in Hansard the next day and then form a view on it. However, I shall share one or two things with the Committee that come to my mind and I think we should take away from this.

Of course this is about the balance between privacy and freedom of expression. It was interesting that the noble Lord, Lord Black, was at pains to point out in his intervention that he did not think there would be any country in which the sort of systems that are discussed in some of the amendments here took place. I ask him: is there a country that he would be happy to live in that did not have a statutory protection of privacy and freedom of expression, however well balanced and proportionate that would have to be? The answer would be very interesting.

My memories from this will be of the long campaign that the noble Baroness, Lady Hollins, has fought to try to get this troubled area of our law into better shape. The perhaps reluctant speech by the noble Lord, Lord McNally, in opening up the way for the noble Lord to debate issues relating to earlier approaches to this area, struck home for me. I thought it was a powerful intervention and one we should think hard about.

My ultimate feeling about this is that we may be talking about the very narrow issue of data processing in relation to journalism, but of course it engages all the issues that arise from any decision that we make about the balance between privacy and freedom of expression. As I tried to demonstrate in the discussions on day one of Committee, if there were better protections between a right to privacy and the right to freedom of expression than there currently are in the Bill, maybe this would be an easier process, but they are not there yet. We need some movement here. The genuine offer that I made to the noble and learned Lord to try to find common ground on this and move forward, which was picked up by others, seems to have been rejected. That is sad, and we will not get very far if that is the attitude we are going to encounter.

At the end of the day, we may not have a choice on this. If Parliament is unable to act, it may well be that the privacy law we end up with will be judge-led, arising from cases that happen to come in, out of which a body of law will be built up that does not suit the noble and learned Lord and his friends. He should think very carefully about where we are at the moment, where the political power lies, where the interests of those engaging with this are coming from and how long it would be before we got to a point where we could take this forward.

I think we will come back to this on Report more than once. There are issues here that will survive the helpful comments made by the noble and learned Lord, who covered the detail of the amendments very fully. I will read what he said very carefully. I do not think we have got to the bottom of how you get the balance in law for a long time so that it works. It is not to do with definitions of which code or otherwise we are talking about; we are talking about real principles here that need to be addressed.

--- Later in debate ---

[Lord Skidelsky]

I should like to make just one point. The noble and learned Lord, Lord Keen, came close to admitting that to put IPSO in the Bill was a mistake—I say came close to admitting—whereas it would have been perfectly all right to have just said, “the editors’ code”. There is something there to discuss, because if you call it the IPSO editors’ code, that looks as if you are favouring a particular organisation, rather than a code. The code is owned by the newspaper publishers; it is their code; we need to take that into account. It is less obnoxious just to have “the editors’ code”, than to have an organisation named in the Bill as the effective carrier of that code. I do not know whether the noble and learned Lord is willing to consider leaving out mention of the organisation. If so, it would be interesting to discuss how best to do that. I may come back to this on Report, but thank him very much for his speech.

[Lord Stevenson of Balmacara]

I beg leave to withdraw the amendment.

Amendment 42 withdrawn.

Fox-Sky Merger

Lord Stevenson of Balmacara Excerpts

Thursday 20th July 2017 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I thank the Minister for repeating the Statement made in the other place. I am grateful to the Government for returning to the Houses of Parliament, both here and the other place, just before Recess to update us on progress.

We have been following the twists and turns of this saga closely. It is obvious, and absolutely right, that the Secretary of State is taking her quasi-judicial responsibilities very seriously. While we regret that she is minded not to refer the bid on grounds of broadcast standards, we support her decision, as I take it to be, to refer the bid to the CMA on the grounds of media plurality.

I have three main points that I hope the Minister will be able to respond to. The first is on the timing. Could I press the Minister on the possibility that the Secretary of State might announce her decision during the Summer Recess? Surely Parliament must have the opportunity to scrutinise any decision that she makes. It is not her job to operate to 21st Century Fox’s corporate timetable; in my view, the company would be better to abide by the rules as they currently are and respect the role of Parliament in this, and it should signal that very clearly. In my view, the Secretary of State should demonstrate to those at Fox that it is she, as an elected representative of the people, who is in charge, not them. I ask that the usual channels in this House also be kept abreast and that we be informed if there is to be a Statement so that we can respond to it.

Secondly, I want to press the Minister on the broadcasting standards investigation. I suggest it needs a bit more work before a decision is finally reached. Recently, compelling arguments for this have been made in the other place by my right honourable friend the Member for Doncaster North and the right honourable Members for Twickenham and for Rushcliffe—noble Lords will be aware that that is a pretty distinguished cross-party alliance. The truth is that the Murdochs have a history of regulatory non-compliance and of corporate governance failure that calls their commitment to broadcasting standards into serious question. Ofcom says that there are,

“significant concerns about Fox’s approach to ensuring Fox News content complies with the Broadcasting Code”.

We saw in the phone hacking scandal that senior employees and executives at News International failed to comply with criminal law or with acceptable standards of journalistic conduct—and, frankly, acted with a flagrant disregard of basic human decency. We see from the ongoing sexual and racial harassment scandal at Fox News in the United States that there is ample evidence of what Ofcom calls “significant corporate failure”.

Does the noble and learned Lord agree that it is time to look again at the fit and proper person test applied in the case of broadcasting standards? I heard it said by a distinguished former member of Ofcom that that test could be satisfied only if the person concerned was caught in the act of murder, had been prosecuted and that the body was exhibited before any such decision could be taken. That is probably a test too far. The noble and learned Lord will recall that, in the Digital Economy Act, several noble Lords from around the House joined together to table an amendment that suggested that there were other models for the fit and proper person test that might be more appropriate—particularly those applying under the Financial Conduct Authority. At that stage, we were persuaded by Ministers that it would be inappropriate to press the amendment to a vote, which I now regret, because they promised an early opportunity in the legislative timetable to bring forward recommendations on it. Can the noble and learned Lord confirm that that is still the plan and share with us which legislative vehicle will be used for it?

Of course, the best way to get at a lot of these corporate failure issues would be to proceed with the inquiry that has already been promised, which is specifically to look into part 2 of the Leveson inquiry. Will the noble and learned Lord confirm that that could still be implemented, because that could be very germane to what we are discussing today?

There is a third issue that we need to look at. On one hand, a lot of the problems that have been caused here are to do with the way in which the corporate veil hides individual actions in a way that would be inappropriate in the broadcasting area. This issue is really about control of media organisations. This is not a battle for the control of a particular broadcasting entity called Sky News; it is really a battle between old media and new media. At the heart of that lies control of personal data, in which there is considerable interest and investment being made. It is about data power—the power to know who is watching what and what their interests are will be more important as competition increases. We are talking about battles between the organisations concerned in this merger and organisations such as Google and Facebook. Does the noble and learned Lord believe that the CMA has the powers to investigate this aspect of media plurality? Without knowing where the data sources and how they are being used, it will be difficult for it properly to assess the impact on media power going forward? I look forward to hearing from him.

[Lord McNally (LD)]

My Lords, like the noble Lord, I welcome the Statement and the courtesy and openness with which the Secretary of State has approached her responsibilities. That is why I find it extraordinary that, having emphasised and carried out her duties to Parliament so assiduously, it could even be suggested that she should make a decision during an eight-week gap between Parliament rising now and returning on an issue that has been before her, regulators and Parliament for years. That would be an absurd assault on parliamentary dignity and responsibility, and I strongly urge her not to follow that road.

Part of the problem is the siloed nature of the decision, when what is needed, as the noble Lord said, is a holistic judgment about the fitness of this takeover. But that is how it has been played. The problem is also the siloed nature of modern business structures. Various parts of the structures can clear part of the siloed questions when we all know, as I have said, what the web is and that the spider is at the centre of that web.

I also press the Minister on whether this could lead to the second stage of Leveson and on the point made right at the end. I remember a few years ago somebody buying a canal and everybody thought what an absurd price he had paid for a canal—the age of canals was over. Then it suddenly dawned on everybody that he had not bought a canal; he had bought miles and miles of land on either side of the canal and made a fortune as a property developer. The same is true now, as the noble Lord has said. I have often pondered what on earth niggles Murdoch that he has tried, year after year, to get 100% control of Sky. What act of vanity is this? He may be vain but he also knows where a quick buck is to be made. It occurs to me that there is ample evidence that what Sky has is a database of some 13 million people, which could become increasingly valuable in the data battles ahead. I wonder whether the Secretary of State has asked the Information Commissioner’s advice on this aspect of the takeover and on how it fits into other legislation that we are considering. This is a foreign bid for a British database, which should give concern about how it is being handled. I go back to the friendliest of warnings: the Secretary of State would be very wrong to consider making this decision while Parliament is in recess.

Digital Economy Bill

Lord Stevenson of Balmacara Excerpts

Report: 2nd sitting (Hansard - continued): House of Lords
Monday 20th March 2017 Lords Chamber

[Lord Aberdare (CB)]

My Lords, I should like to speak briefly in support of Amendment 29A. Removing merit-based appeals, as Clause 80 would do, seems both unfair to appellants in cases where Ofcom may make decisions that are materially wrong even if they reflect due process, as will inevitably occur on occasion, and undesirable, potentially harming consumers and deterring investment. This seems precisely the opposite of what is needed in such an important, strategic, high-value, fast-changing, innovative and growth-oriented sector.

I will not try to restate the arguments made in Committee, or those made by the noble Lord, Lord Foster. I just make two points in response to the helpful letter from the noble Lord, Lord Ashton, on 14 March. The letter describes the merits appeal as,

“akin to a retaking of the whole decision”,

but an appeal will normally be made only on specific grounds where an appellant believes there is a clear error. So the amendment would not require whole decisions to be re-examined, only those aspects specified in the notice of appeal.

Secondly, I accept that the judicial review process is,

“perfectly able to meet the current EU law requirement that the merits of the case are duly taken into account”

if the judges so decide in a given case. Rather than leaving it to judicial discretion, however, why not spell out in the Bill that they should be taken into account even after they are no longer banned by the EU framework directive, thereby future-proofing it for the post-Brexit world?

Ofcom decisions are of crucial importance for both consumers and telecom providers, and indeed for investors. As we have heard, the change to a judicial review standard is strongly opposed by the great majority of industry participants, from the major incumbents such as BT and Virgin to much smaller, newer market entrants, such as CityFibre, along with the CBI and techUK, the latter representing 900 tech sector companies, the majority of them SMEs.

I claim no specific expertise on judicial review, and I am no great fan of BT, but it is important that the relatively modest requirement set out in Amendment 29A should be incorporated into the Bill.

[Lord Stevenson of Balmacara (Lab)]

Briefly, the ground has been well covered by the noble Lords, Lord Foster and Lord Aberdare, and I have little to add. Three things strike me. I recalled in Committee that this was one of the areas where we had received the most external notifications and correspondence. It is still something that we need to take carefully. As has just been said, it is surprising that almost the entirety of the industry affected by the judgments of Ofcom have joined up to make the case.

Following on from both speeches, what is required is a statement from the noble and learned Lord. I am sure he is straining at the leash to give us all another compromise solution that will do the trick. He is shaking his head; maybe there are other things he has to cover as well. However, the situation seems to hinge on whether Article 4 of the EU directive applies sufficiently well after this Bill goes through, as before. Yet, as has been mentioned, there will be an opportunity, presumably in the great repeal Bill, to cover exactly this point. So what is the hurry?

[Lord Keen of Elie]

My Lords, I am obliged to noble Lords. As the noble Lord, Lord Stevenson, observed, there have been quite a lot of external communications on this. Indeed, I notice that the quotation that the noble Lord, Lord Foster, gave on my observations in Committee was identical to that quoted in a letter from Towerhouse LLP to the Department for Culture, Media and Sport on 17 March. Everybody seems to be singing from the same hymn book.

At present, Section 195 of the Communications Act 2003 requires that appeals against Ofcom’s regulatory decisions are decided by the Competition Appeal Tribunal on the merits. I shall come back to “on the merits” in more detail in a moment.

Appellants argue that appeals “on the merits” should allow for a bottom-up review of the decision, inviting the tribunal to substitute its own view for that of the regulator—in effect, two tiers doing the same thing. Appeals are therefore seen as an opportunity to rerun arguments that were considered and rejected by Ofcom in reaching its decision, or to put forward swathes of new evidence to persuade the tribunal to reach a different decision. Such appeals can lead to extremely lengthy and costly litigation, with extensive cross-examination of experts and witnesses. This depletes the regulator’s resources and means that other regulatory action by Ofcom is inevitably delayed, allowing for the potential for providers to frustrate the regulator with speculative or even spurious appeals, causing considerable uncertainty in the market and delay to other regulatory decisions.

The Government consider that appeals in the communications sector need to be rebalanced to ensure that Ofcom is held properly to account for its decisions, but also enabled to regulate in an effective and timely manner in the interests of citizens and consumers, as it is required to do. Clause 80 does just that; it requires that instead of merits appeals, the tribunal must decide appeals against Ofcom’s decisions by applying the same principles as would be applied by a court on a judicial review. Judicial review is generally a well-understood standard of review against which very significant decisions made by most public bodies are tested. Importantly, this will ensure that appeals are focused on identifying errors in Ofcom’s decisions, rather than simply seeking to persuade the tribunal to reach a different conclusion.

Those affected by Ofcom’s decisions will remain able to challenge them effectively. In Committee, the noble Lord, Lord Clement-Jones, said that judicial review was,

“solely concerned with whether the decision is unlawful in a technical sense—that is, was the correct process followed?”.—[Official Report, 8/2/17; col. 1734.]

I hope I can reassure him that this is simply not the case. First, appellants are able to argue that Ofcom’s decisions are based on material errors of fact or law. Material errors will therefore be identified and corrected in a judicial review process. Secondly, judicial review is a flexible standard of review, which allows the court to decide on the appropriate intensity of review according to the individual circumstances of the case. For example, there may be more intensive review processes in the context of matters pertaining to human rights. In particular, Ofcom has various statutory duties to ensure that its decisions are proportionate—in other words, that they go no further than is appropriate and necessary to attain a legitimate aim. In reviewing whether a decision is proportionate, the courts can carry out a closer and more rigorous review of the decision.

Of course, appeals in the communications sector are required to ensure that,

“the merits of the case are duly taken into account”,

as a matter of EU law under Article 4 of the EU framework directive. That will remain the case under a judicial review standard. I understand that there is uncertainty about the extent to which requirements in EU law may become a part of UK law after the United Kingdom leaves the EU, but that will be a matter for Parliament to determine when the great repeal Bill is introduced, as the noble Lord, Lord Stevenson, observed, and will be looked at in the context of the overall future regulatory framework for electronic communications, including the appeals regime, once the UK has left the EU.

A number of Ofcom’s regulatory decisions are already appealable only by way of judicial review, and the Court of Appeal confirmed as long ago as 2008 that judicial review is capable of taking account of the merits of the case, as required by EU law and, in particular, by Article 4 of the EU directive. Lord Justice Jacob in the Court of Appeal in the T-Mobile case in 2008 said that it,

“is inconceivable that Art. 4 in requiring an appeal which can duly take into account the merits, requires Member States to have in effect a fully equipped duplicate regulatory body waiting in the wings just for appeals. What is called for is an appeal body and no more, a body which can look into whether the regulator had got something material wrong”.

He also held that,

“there can be no doubt that just as JR was adapted because the Human Rights Act so required, so it can and must be adapted to comply with EU law and in particular Article 4 of the Directive”.

Indeed, in a more recent case involving judicial review and Article 4 in 2016, Mr Justice Cranston observed that, as the Competition Appeal Tribunal had said:

“Ofcom enjoys a margin of appreciation on issues which entail the exercise of its judgment”,


and that,

“the Tribunal should apply appropriate restraint”.

It is not a second-tier regulator, and the fact that it might have preferred to give different weight to various factors in the exercise of a regulatory judgment would not in itself provide a sufficient basis to set aside Ofcom’s determination. It should not interfere with Ofcom’s exercise of a judgment unless satisfied that it was wrong.

These are the relevant judicial review standards that will be applied in these circumstances. We do not want a complete retrial—if I can call it that—or a situation in which, at two levels, we begin at the beginning and end at the end with an entirely different opinion and approach to the evidence, and, perhaps, entirely new arguments being advanced evidentially in support of the merits of a case. That is a never-ending process and is not common to any other area of regulation by a public authority.

The judgments I have referred to have been considered in a number of subsequent cases and it is clear that a judicial review standard is consistent with the requirements of Article 4 of the framework directive. In these circumstances, it is not considered that there is any real need for this amendment. It is appropriate that we proceed with Clause 80 and I therefore invite the noble Lord to withdraw the amendment.