Shared Rural Network

Debate between Lord Stevenson of Balmacara and Lord Foster of Bath

Monday 28th October 2019 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I am grateful to the Minister for repeating the Statement made in another place. Before I start on a detailed response, I should say that I find it hard to work out exactly what has been announced today. The money that the Minister was talking about was already announced. I am not in any sense accusing her of simply repeating a previous announcement, because there is a focus to it that was not there before. However, if the money was already available and there was nothing new in it, the arrangement seems conditional—this sounds a bit like Brexit—on a legal agreement being established in an uncertain timeframe, with uncertain consequences if it is not so done. It is therefore a sort of precursor, or perhaps a preheating, of an announcement yet to be made that an agreement has been so made.

The agreement that is being announced is one that the operators seem to have come to themselves. As was clear from the Statement, it has caused a bit of a problem. Rather unusually, it has caused the Government to suggest to Ofcom that the previously announced spectrum auction, which it has been working on for six to nine months, has to be changed at rather late notice to ensure that there are not unfortunate geographical restrictions placed upon it. If it does not all come together in an appropriate timescale, and if we do not get the solution from the operators that the Government are clearly signalling, then the whole thing goes back to square one. We will be back where we were before, with a patchy and not very satisfactory solution despite the money. I am sounding downbeat about this because, while I want to welcome it, I am a bit confused about the overegging that appears to be happening here of what is a good idea but which certainly has not yet been delivered. It is rather unusual for the Government to take steps this way forward. Perhaps there is an election coming and they wanted to get some news out. Maybe that is what it is, so perhaps I am being silly about this.

To roll back a little, we are starting from a very bad place. As the Statement makes clear, coverage from the four operators in the United Kingdom is about 66% of the UK’s geography. That translates to figures I have seen showing that about 90% of UK parliamentary constituencies are not getting complete coverage: there are, right across the country, places for which no coverage at 4G level is available from any operator, let alone more than one. We are starting from a very bad position.

We went through this in some detail when dealing with the Digital Economy Act. As Members on the Bench opposite will recall, we suggested that the Government were hopelessly unambitious in their targets and that the USO of 10 megabits should be replaced by a target of 1 gigabit for the provision of basic services through wi-fi, linked with mobile operation, to make sure that 100% of the country was covered. Under this plan, which as I understand it is skewed towards a solution which will allow for the more rapid rollout of broadband, we will get to only 95% geographical coverage. That will, of course, be much less in terms of the number of properties covered and may not reach the individuals and SMEs in rural constituencies who need these services. Nevertheless, it is certainly an improvement.

I hope, however, that the noble Baroness will explain the difference between the current ambition for a 4G solution and where the Statement ended up, saying that this is to prepare the way for the country’s 5G. As I understand it, a 5G solution to the problems we face will require probably five or 10 times as much infrastructure involvement. Is that included in this process, or is this yet to come? Are we really talking about a 4G solution?

In welcoming this, we should recognise that industry coming together to come forward with a proposal has done us all a great service. At the heart of this is the rather coy announcement that if you have a contract with an operator—as is the norm; you tend to have only one mobile phone and one operator servicing it—you will receive coverage, wherever you are. My rather naive technological brain suggests that that must include some form of roaming connection. Can the noble Baroness confirm that the Government have finally grasped this nettle and that a solution to the problem faced only by Britain—on the continent, you are linked up immediately to whichever operator has the best service available—will now be embraced? She seems to pose as a solution that, if coverage is everywhere, we will get rid of not only partial not-spots but also total not-spots, and that that can be done only if all the operators work together. If that is true, then I welcome it; it is the answer to the questions we have been posing for some time.

Finally, can the noble Baroness confirm that there will be targeted figures to measure success against? Consumers need to know that the solution proposed today will work. Some sorts of targets are needed, because it is a long time until 2022. If we could have some sense of what those markers will be and how they will be met, that would be helpful.

Whether it is 5G or 4G—and 4G is at least a step forward for most people—it is important to know the benefits available. The ability to access it while travelling on the railways and motorways is key to future development. Can the noble Baroness confirm that that will be part of the proposal? Can she say whether the funding available, which is conditional on a legal contract, will still be available if, at the end of the day, a deal does not go through and we do not have the legal construct to allow us to continue? Can she tell us that that money will not be lost?

[Lord Foster of Bath (LD)]

My Lords, on these Benches, we welcome the Statement in so far as it goes, but we also note that it is not yet a done deal. I had the privilege to chair your Lordships’ Rural Economy Committee. We very quickly discovered that, on connectivity, rural areas have been left way behind. The Government told the committee that they have always recognised the need for rural areas to benefit as much as anywhere else from digital infrastructure to transform the economy. Yet, as the Statement acknowledges, it is rural areas that have really lost out. There has perhaps been recognition of a need, but so far there has been no action to cater for it.

This Statement, as some other recent Statements have done, suggests a welcome, if belated, change of heart. But it will take until 2026 to eradicate partial not-spots and reduce the total not-spot land-mass from 7% to 3%—way longer than was originally promised by the Government. Will the Minister continue to look at the option of mobile roaming in rural areas to provide at least an interim solution to help with the partial not-spots?

The shared rural network deal includes dropping the coverage requirement in the forthcoming auction of the spectrum that is to be used for 5G. Given that this deal has not yet been signed, can the Minister explain why Ofcom has today announced the start of a consultation on a new auction arrangement that does not include any coverage obligation? What will happen, for instance, if this deal does not get signed? The Minister says that she is satisfied that this deal improves on the originally proposed coverage requirements. What is the Government’s analysis of future 5G coverage? If we are still going to go by percentages, will she at least acknowledge that, if we eventually get to 55% 5G coverage, rural areas will still be losing out? Surely it would have been better to include a “rural first” requirement, so that rural areas do not get left behind?

The Statement also refers to the rollout of high-speed broadband. Since rural areas also lag behind with this form of connectivity, and so will be most reliant on the broadband universal service obligation, why will the Government not follow the advice of your Lordships’ Rural Economy Committee and increase the paltry upload and download speeds in the USO?

Finally, government efforts to mandate fibre to the premises on most new housing developments are welcome, but developments of fewer than 30 houses seem set to be excluded. Since such small developments are often in rural communities, is this another example of rural areas losing out? Will the Government think again? That said, we welcome the shared rural network deal and hope that it comes to fruition.

Electronic Communications (Universal Service) (Broadband) Order 2018

Debate between Lord Stevenson of Balmacara and Lord Foster of Bath

Tuesday 5th June 2018 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I shall start with a brief quote from the Guardian in August 2017:

“Britain is a broadband laggard with an average speed ranking it 31st in the world trailing most of Europe, Thailand and New Zealand. A new report has found that across the UK … it takes about an hour to download a … Hollywood film … The average speed in the UK is less than a third that of Singapore, which tops the global league table measuring broadband in 189 countries, where it takes an average of 18 minutes to download a [similar] film … The UK falls well short of the average speeds enjoyed by European countries … The report found that overall the UK lags behind 19 European countries, 17 of them in the European Union”.


Our conversations in this House about broadband usually take the form of a question or short debate on why reception and coverage received by individual Members of your Lordship’s House in such and such a place are so bad; others join in. Notspots are mentioned. Rural areas where 3G and 4G mobile coverage are to be found get discussed in little groups gathering around this Chamber as if they were places with Michelin-starred restaurants and secrets to be shared only discreetly and with close friends. Occasionally we might hear people drop in scary words like “latency” and “contention ratios”. This is followed by a reassuring statement from the Minister that things are going well, investment is pouring in, and that coverage is in excess of the target and is fast approaching 100%. However, if one listens carefully, the Minister never explains 100% of what, and that is a question I want to come back to. I confidently expect that this debate will be no different.

I have no substantive issues to raise on the order before us, and indeed I want to compliment the team at DCMS for the high quality of the paperwork that has been provided, in particular the Explanatory Memorandum. What I want to do is try to set out why the government approach to this issue was wrong in the Digital Economy Act 2017 and is wrong now, and to beg them to use the powers they have in that Act to try to push forward urgently towards what we have referred to in earlier debates as the “two-gig economy”.

Therefore, my starting point is an amendment to the Digital Economy Bill that we won on Report in February 2017. The early election that year meant that we did not get to ping-pong on the Bill and the amendment fell in the Commons. I like to think that our substantial win in the Division Lobby would have got us further down this track, had it been a normal year. As my noble friend Lord Mendelsohn, who moved the amendment, pointed out at the time, our amendments were about making sure that the universal service obligation being introduced met the Government’s published objectives, as set out strongly in the Ofcom technical advice to the Government at the time. It still seems incredible that the Government have come forward with the slowest of the available options. The only option that meets all the requirements was Ofcom’s scenario 3, with download speeds of 30 Mbps and upload speeds of 6 Mbps, compared to what is being proposed in the USO: 10 Mbps download speeds and 1 Mbps upload speeds, which is what we proposed.

At this stage, it is worth commenting that, in my view, responses to the government consultation showed support for higher speeds than what made it into the USO. Possibly reflecting that, I think it fair to point out that the Minister’s introduction to the report on the consultation said:

“I want to be clear that setting the minimum speed at at least 10 mbps is not the limit of our ambition. To support our vision of full fibre connectivity, in the 2016 Autumn Statement, the Government announced a £1.1bn package of measures to support investment in digital infrastructure, aimed at ensuring the UK has the digital connectivity it needs for the future, including full fibre networks and 5G”.


That is pretty good. I think we can all go along with that. Of course, it fits very nicely with the thrust of our amendment, which was to set a very high aspirational target for the USO— but a tough, unachievable floor for the ordinary day-to-day work—require the rollout of the USO to start in rural areas and prioritise small and medium-sized enterprises. We found all those ideas in Germany, whose Government had recently legislated successfully for precisely that approach.

In framing our amendment, we asked ourselves who could possibly argue against setting an aspirational target for broadband connection speeds of 2 Gbps or more, or object to the cost-effective minimum standard of 30 Mbps download speeds. We thought that the Government would welcome us specifying that rollout must be rural and SME-focused. Indeed, we spiced up the amendment even further by adding a requirement on the Secretary of State to ensure fair competition—“This is the Labour Party talking. We want fair competition and we want it now”—and calling for universal service obligations for mobile coverage. We thought that we were playing bingo and had won the full house, but we were wrong.

Looking back at the debate on the amendment, the key points that come out are as follows. The Ofcom report to which I referred is clear that the Government’s preferred USO speed of 10 Mbps will not be sufficient. It argues that even if it is possible and data usage might not require any more—a point that it says is unlikely, even when the technology gains in compression and transmission techniques are taken into account—other issues such as contention rates and latency would render 10 Mbps unfit for usage in a very short time. The best that the Ofcom report can muster in defence of a 10 Mbps download speed is that if it were adopted, it would have to be reviewed almost immediately.

Other countries have shown what happens to innovation and productivity if due care and attention is not placed on the needs of SMEs or on ensuring the widest geographical reach possible. The issue here is linked to the vacuous reliance on coverage in a geographical sense, rather than in terms of the ability of the infrastructure to provide it, now and in the future, if it is to grow and develop. Coverage of 95%—even 98%—may be where we are at geographically or in terms of the number of properties reached, but it does not feel like that to anyone trying to use the internet to start up a business in rural parts of the UK. We need a measure for this in terms of whether one can use one’s equipment wherever they are in the United Kingdom.

Last week, I was climbing in the Scottish Highlands. We could not get coverage in the glens, not unexpectedly, but once I was at the top of Sgurr Fhuaran—I will just mention that it is 1,057 metres high—I found that I was on 4G. I sent messages and photographs. I emailed my friends, as well as the many fans and admirers of my brilliant climbing skills. In fact, I have them here in my pocket if noble Lords wish to see them. It was so good that I could have tweeted about it. But these are activities which I cannot do at my home only 25 miles away from this place. I cannot even have a smart meter, of which I have heard so much, because the connectivity in Little Missenden, where I live, is so bad. Do not get me started on the connectivity in this place.

What on earth is the point of ignoring, in a USO, mobile telephony? The Government wanted to resist that from the start, even though it has been dealt with in a different way. It may be in the various directives, but it makes no sense. That is a point I want to develop.

We are at the cusp of another revolution in technology. If you have lived through and enjoyed 2G, 2.5G, 3G, and even if you are experiencing 4G, you may understand better than I do what is going to happen when we get to 5G. I gather it is not just an upgrade. This is a new, real-time communications technology which will fit seamlessly with wi-fi, providing the infrastructure is upgraded. It is the technology that will make the internet of things viable and allow us to use many other newer technologies not yet thought of. With the capacity and response times achievable with 5G, it can only happen if we install fibre now and that must mean fibre to the premises.

Driving back from Scotland on Saturday, with aching limbs and a slow puncture, I was listening to digital Radio 4. That prompts another thought for the Minister: when are we going to have digital switchover on radio? While I was waiting for my car to be repaired, I had a chance to catch up with a programme called “The Bottom Line” with Evan Davis. He and his guests were discussing what 5G will do to our current use of the internet and, in turn, to our economy. I will not repeat all the points that were made, but it was a very rich and good discussion about what we should be doing to prepare for 5G. It is available on iPlayer and well worth listening to. The point repeated by the panel time and again is that we are well behind the rest of Europe in terms of delivering fibre to the premises. FTTP must be of a new standard, because without that, we will fall even further behind the rest of the world.

FTTP has been recommended by the infrastructure commission to be part of the universal service obligation. Fibre reflects the current and likely future patterns of consumer and citizen behaviour and the increasing use of mobiles as the growing means, particularly in the younger demographics, of accessing all sorts of digital and other services, often in parallel in real time.

My main regret is that we were not successful in getting our amendment to the Digital Economy Bill into the Act. The Act gives the Minister the power to review the USO, so my plea is that he does not regret the situation that we are in and begins to review the USO immediately. Surely the architecture of the USO has to be consistent with the Government’s productivity plan, industrial strategy and the national infrastructure plan. The argument is that without some ambition, the USO itself may become a constraint on all these important challenges.

The Government seem to be caught by the failure of the market structure which they are working with. The USO’s construction has necessarily been shaped with the imperfections of the market structure that has succeeded in getting us on the journey, but is inadequate to address current or future technology. The department needs to use the powers in the Bill to up its game. I beg to move.

[Lord Foster of Bath (LD)]

My Lords, may I begin by congratulating the noble Lord, Lord Stevenson, on securing an opportunity for us to discuss the Government’s universal service obligation proposals? I very much enjoyed his characterisation of the many debates that we have had on this issue and related issues in this House. I suspect that the noble Lord has, as I do, a good idea of what is in the Minister’s folder and what we are likely to hear at the end of this debate.

I certainly agree with the noble Lord that we should be supporting the principle of a broadband universal service obligation, and I agree with him entirely that the USO lacks ambition. Indeed, by the Government’s own admission, the USO is simply a safety net and frankly, not a very good one at that. I have looked at many Ofcom documents and I cannot find a single one in which they express real enthusiasm for a USO of just 10 Mbps. The lack of ambition shown in the USO is common to much of the Government’s whole approach to broadband rollout.

I want to begin by declaring two interests. First, I live in the wilds of rural Suffolk in a home as yet untouched by superfast broadband, and not even by fast broadband. At the weekend, I used the excellent Ofcom app to check my broadband speed and discovered that I have a download speed of just about 3 Mbps and my upload speed is precisely one-third of 1 Mbps. I hope your Lordships will forgive the pun, but I will be champing at the megabit to take advantage of the USO when it comes along.

Digital Economy Bill

Debate between Lord Stevenson of Balmacara and Lord Foster of Bath

Report: 1st sitting: House of Lords
Wednesday 22nd February 2017 Lords Chamber

[Lord Stevenson of Balmacara]

My Lords, I move Amendment 25 and am grateful for the support of my noble friend Lady Jones and the noble Lords, Lord Clement-Jones and Lord Foster.

This is a rerun of an amendment that we tabled in Committee. At the time, discussions were in place between rights holders and those who operate the search engines, which are the focus of the amendment, and we were not sure how that would play out. We were promised much, and the Government have again delivered—which is becoming too much of a refrain for my liking. A voluntary code has been agreed between the parties, signed up to and issued—there has been press notification about it, so it must be true. The question is: what will it do? That has not been answered. We have discussed what it might do, but we have not yet seen the wording of the voluntary code. I ask the Minister to circulate to those participating in the debate what is in the much-vaunted code, so that we have a sense of whether it will achieve its purpose.

My concern from what I have heard is in three parts. First, it is large copyright-owners and large inquiry systems such as Google that are involved. That begs the question of whether those who are less able to exercise their rights—particularly those who have individual or small parts of rights in small productions—will have any voice. The reporting that I have read talks about rights holders and search engines working promptly on receiving responses about infringing content to ensure that these things are taken down.

Secondly, there is much talk of expanding efforts,

“to more effectively use such notices to demote domains demonstrated to be dedicated to infringement, and to work collaboratively with rights holders to consider other technically reasonable, scalable avenues empirically demonstrated to help materially reduce the appearance of illegitimate sites in the top search rankings”.

I could read that again, because you would probably need to hear it again to have the faintest idea what we are talking about. I fear that it smacks of either a lowest common denominator approach or some hard arm-wrestling in the corridors where the discussion took place to get something that looks reasonable on paper. It does not smack of a real commitment to scourge out the terrible way in which search engines have referred people who should have known better to material that was not cleared for copyright and should not have been made available to them through that route. There is also talk about,

“work to prevent generation of Autocomplete suggestions which lead consumers towards infringing websites”.

It says that work will be done to prevent it, not that it will be stopped.

“Search engines will provide, or continue to provide, processes to promptly remove advertisements”,


linked to searches. So my second point is that this all looks pretty good on the surface, but will it work in practice? I have my doubts.

Thirdly, it will be run by the Minister of State for Intellectual Property, who,

“will oversee the implementation of this Code of Practice, supported by quarterly meetings of all parties, and set requirements for reporting by search engines and rights holders on any matter herein, including in particular those matters where the Code of Practice calls for ongoing discussion”.

At last, we get it:

“The Minister shall review the effectiveness of the Code with the parties after one year, and ensure continuing progress towards achieving the Shared Objectives”—


which is, rather nicely, in my copy, in capital letters, so they must be really important.

It is easy to lampoon this. I am sure it is a good step forward in the right direction, and we wish it well, but I wonder whether it will take the trick on this issue. As we said in a previous discussion, should there not be a backstop power; should these powers not be taken now by the Government to ensure that they can do something if it does not work, if some people move away from it, or if new entrants to the market feel that they have no responsibility to be part of it? These are open questions. There may be a way through, there may not, but we have no way to resolve that because this is a voluntary process.

It took a long time to get to the voluntary code: the working group has been meeting on and off for three or four years, so we know that this is not an easy nut to crack. It is an issue that causes a lot of annoyance and concern. It also affects the earnings of those who have rights that have been abused in this way. There is a feeling—I put it no stronger than that—among those who perhaps know more about this than I do that the search engines do not want to go any further because they fear statutory provision. In other countries and territories—indeed, in America—there is statutory provision, and that has made the difference over there. Why are we not doing that here?

There are a lot of questions about this. The amendment would give a solution to the Government if they wished to take it. I hope that they will consider it, and I beg to move.

[Lord Foster of Bath (LD)]

My Lords, I am delighted to support the amendment in the names of the noble Lord, Lord Stevenson, and others. I am sure that all Members of the House recognise that there is a serious problem that needs to be addressed, although fewer people are accessing illegal material on the internet as a result of the growing number of relatively cheap and easily accessible alternatives. We should welcome that and the fact that in this country we probably provide a wider range of alternative legal sources—for the downloading of music, for example—than any other in the world. Nevertheless, there continues to be a problem, with about 15% of UK internet users—about 6.7 million people—continuing to download and access illegal material. I therefore welcome any measures that can be taken to introduce ways to prevent that. Of course I welcome the voluntary agreement that has been reached. I congratulate the Minister for Intellectual Property, who I know has worked very hard with the relevant parties, including the IPO, to secure the voluntary code. As the noble Lord, Lord Stevenson, said, the details have still to be worked on and there will be a review in 2017.

I ask the Minister to reflect seriously on this key point. In opposition, I have spent a lot of time moving amendments to various proposals that the Government “may” do something to delete “may” and insert “must”. On this occasion, I am delighted to support the amendment, which says that the Government may do something, if the need arises.

The Department for Culture, Media and Sport is rarely given credit for the important role it plays in the life of this country. As a result, it rarely has opportunities to have legislation before the House. While the Minister may tell me, as she did in a previous debate, that should the voluntary code not work, the Government will consider taking legal action at some point, she would find it difficult to find a legislative peg on which to hang that action.

The Intellectual Property Alliance and others have suggested that we need a backstop mechanism in the event that the code, which we welcome, is unsuccessful in future. For that reason, I hope that the Government will be willing to accept what is a simple amendment giving them power in future if they need it.

[Baroness Buscombe]

My Lords, Amendment 25 returns to the topic of search engines and copyright and would give the Government power to impose a code of practice on search engines to minimise the visibility of copyright-infringing websites in search results.

As we have discussed previously, this is an area in which we have been seeking a voluntary agreement between search engines and rights holders, and I am pleased to be able to confirm that we now have that agreement and have finalised the text of a code of practice. This newly agreed code sets out clear targets for reducing the visibility of infringing websites in search results. The code also specifies a number of areas where rights holders and search engines have agreed to work together with the general aim of supporting legitimate content and reducing piracy. We have always been clear that action is needed in this area and it is a manifesto commitment. But we have also been clear that a voluntary agreement would be quicker, more flexible and, most importantly of all, more collaborative than a legislative intervention. We now have that voluntary agreement and the parties to the code are already working to deliver on the commitments it contains. All parties to the agreement have engaged in these negotiations and the work to date in good faith. They are continuing to work in good faith and I am confident that that will also be the case for work going forwards.

The noble Lord, Lord Stevenson, questioned whether it would be possible to have sight of the code. We do not plan to publish the code in full because details about the number of copyright infringement reports a site can receive before it is demoted might allow pirates to game the system. We are, however, very happy to share the commitments in the code in more general terms.

We understand where noble Lords are coming from in seeking a backstop power, but I return to that word “collaborative”. We have come a very long way in what we have achieved thus far. I can remember working and having discussions with search engines in years gone by, trying to encourage them to respect and accept responsibility for what they do and the impact they can have on others. In that sense, we believe very strongly that we should continue with that collaboration and not consider a backstop power. We do not believe it is necessary. With that explanation, I hope the noble Lord will accept that a statutory power is not needed at present and thus feel able to withdraw the amendment.

Digital Economy Bill

Debate between Lord Stevenson of Balmacara and Lord Foster of Bath

Committee: 4th sitting (Hansard - continued): House of Lords
Wednesday 8th February 2017 Lords Chamber

[Lord Stevenson of Balmacara]

My Lords, this amendment deals with the preparations that will need to be made should we be in the unfortunate situation that was animadverted by Sir Brian Leveson when he finished his part 1 report, if the press self-regulation proposals made in it are not fulfilled.

The current situation is complex, and it may be slightly premature to assume that everything is going to fail, but I think that, of the two types of problem that he identified, the first—that no recognised regulator was appointed within a year of the recognition panel’s being established—has not come through. We have a recognised regulator, and it was approved very recently, within a year of the recognition panel’s being established. That is a good thing, and we should bank on that.

The second problem, however, remains. His feeling was that there would be no value in the self-regulatory proposals he was advocating if significant news publishers remained outside the recognised regulator. That has happened in spades. There is a body established by the industry and largely for the industry, IPSO, which is not seeking recognition under the existing procedures. Therefore, that would, I think, represent a failure in terms of Leveson’s original proposal. We also have a situation in which the recognised regulator is not attracting significant support from the press which might be regulated by it, although it does have some support, and that is good, and we support that. It is not, however, operating at the scale or encompassing sufficient of the broad press, which was the focus of the original report, to be considered a success.

We are facing a problem. The problem was anticipated, and the solution proposed by Lord Justice Leveson at that stage was a backstop regulator. Therefore this amendment—which is limited in terms of the exact wording to the digital media, although it could, I think, be read as more appropriate for the wider situation—is almost certainly going to be required because of the situation I have outlined. Obviously, we regret that. We wish, as we always have, that a properly self-regulatory system could be established. However, it is extraordinary that the press, as Lord Justice Leveson says, benefits from considerable support in statute for the activities that it wants, including a provision in an amendment to this Bill to protect journalists who wish to break stories that were in the public interest and who might otherwise be caught by concerns about data leakage. That is an example of the sorts of ways we have often legislated for and supported the press because everybody believes in a free press and believes that the press should be able to operate within the law and without any constraint. However, we also believe—this is particularly true of those who have been victims of press intrusion into their private lives—that the public will not settle for a situation in which the press escapes standards regulation altogether.

We will therefore face a situation within a few months where it is likely that it will not be possible that the Leveson proposals have been brought in and there is a need for a standards regulator. The standards regulator proposed by Leveson in his report is Ofcom, and there is much in the report which shows and explains why that would be a good thing. My amendment, which I hope the Government will accept, says that it is time to start to think about how this will impact on Ofcom’s work and to bring forward proposals under which that should operate. I beg to move.

[Lord Foster of Bath (LD)]

My Lords, it is four years after the Leveson inquiry, and I certainly believe that Section 40 of the Crime and Courts Act 2013 should be implemented, and should be implemented now. I voted for it in your Lordships’ House last October and I certainly support the amendments today, which have much the same effect. I also support the fail-safe amendment moved by the noble Lord, Lord Stevenson, although I hope that it is not necessary and that Section 40 will be brought in.

Some incredibly misleading statements have been made about the impact of Section 40. Most of the newspapers, as we know, do not support its implementation and have featured some quite amazing one-sided editorials. To the best of my knowledge, none of them has permitted a right of reply. I am the former Member of Parliament for the wonderful city of Bath, which is included in my title, so I am sure that noble Lords will not be surprised that I take a particular interest and am an avid online reader of the Bath Chronicle. Three weeks ago it published one of these anti-Section 40 diatribes. I wrote a rebuttal and asked the Bath Chronicle to publish it. I have not even had an acknowledgement so far—so much for a free press.

Perhaps to explain why I support these amendments, and to ensure it is published—albeit in Hansard rather than in the Bath Chronicle—I will read what I wrote, because it sums up exactly where I stand:

“I am a strong supporter of local newspapers and the Bath Chronicle in particular. But I was surprised by your recent editorial suggesting that measures being considered by parliament will mean that ‘Any investigation in the public interest could be silenced by anyone with a vested interest’. This is a complete misreading of the proposals made by Lord Justice Leveson after the Public Inquiry which followed the appalling phone hacking scandal.


Few could deny that in the past the press had a shocking track record of setting up its own toothless regulators which failed to protect the public. Leveson has proposed that the press should now establish a truly independent regulator whose independence is checked and then ‘recognised’ by a body which is itself impartial and independent from government or the press.


This is what the public want as shown by a YouGov poll just last week. When asked ‘Do you think it is important that any newspaper self-regulator undergoes an audit to ensure it is effective and that it is genuinely independent of both politicians and the press?’ nearly three-quarters (72%) said yes and just 6% said no.


The ‘regulator’ under which the Bath Chronicle operates—called IPSO—doesn’t meet this test. It is not only funded but controlled by the newspapers it regulates.


Were the Chronicle to join a ‘recognised’ regulator, or were IPSO to demonstrate through getting recognised that it met proper standards of independence and effectiveness, the funding issues you describe would not happen. Moreover, the public would be protected and you”—


that is, the Chronicle—

“would receive protection from wealthy and powerful local figures if they tried to bully you into withholding stories about them by threatening you with unaffordable court costs”.

My article ended:

“I hope Parliament will agree to support the public and back Leveson’s proposals”.


I certainly hope the Government will accept the amendments before us today.

Digital Economy Bill

Debate between Lord Stevenson of Balmacara and Lord Foster of Bath

Committee: 4th sitting (Hansard): House of Lords
Wednesday 8th February 2017 Lords Chamber

[Lord Stevenson of Balmacara]

My Lords, I was slightly surprised at the way the Minister rebuffed concerns about the way in which Parliament engaged with the royal charter process last time. It might be because he joined us halfway through, to a little bit of shock but quite a lot of pleasure. Looking back on it, I do not think it can be said that Parliament was as engaged as it wished to be in the process. The ability to speak on two occasions when Statements were graciously made by Ministers, and to speak in one debate focusing, at that stage, on the draft charter, with the agreement as yet not finalised, can hardly be described as participating actively in the process. I think we can agree to differ on that point. I am sure that noble Lords who spoke in the earlier debate had a very different version of how that might have gone, including involvement by Select Committees and involvement in the detail, which would have resulted in proper and effective scrutiny of the Government’s proposals and the eventual outcome.

This amendment, by serendipity, actually deals with some of the fall-out of the rather deficient process we are going through. When charters are drafted, considered and debated, they are never alone: there are lots of other things going on. Many people present will be able to give witness to that effect. One of the things that sometimes gets missed out is the detail in the agreement. The agreement, of course, is really the mechanics of how the arrangement between the Government and the BBC works in practice. One was brought in in such a way and at such a time that it was never discussed in your Lordships’ House or in the other place. It only really became an issue once the charter was about to be sealed. The issue was the changes to the way national radio output was to be operated in future, which were being imposed on—although not necessarily resisted by—BBC management. That is the subject of this amendment.

Amendment 222E is a probing amendment, asking the Government to conduct a review of an important sector of the creative economy. It does not specifically relate to the BBC—although it is cued into something that is happening there—but it would provide useful information and detail that would be of interest to the Committee. If the review were carried out in the way I suggest, with a report covering a range of topics related to radio production, I hope it could be brought to your Lordships’ House and generate a good discussion.

In short, about 60% of BBC national radio output is going to be put out to competitive tender over the next few years, to 2020. Over the past 20 years, BBC radio has actually increased its external commissioning from zero to around 20% of output. That is quite a slow rate of progress, but that is not unconnected with the fact that we are talking about a very fragile sector of the creative industries. Radio production does not involve a very large group of people. The independents are usually quite small and not in the habit of operating on a scale that would enable them to take over the huge increase in the proportion of radio that we are talking about.

The proposal would mean an extra 3,000 hours of national radio output being put out to tender every year. That, of course, does not come free of charge, but with the cost of a commissioning process in-house at the BBC. Therefore, it is not all a one-way process: there will be additional costs. Those costs will not be funded by any additional funding from the licence fee or any other process, so there is bound to be a squeezing of radio budgets, and neither external nor in-house producers will be able to rely on getting any increase. It is going to be a rather difficult situation, affecting the people involved. Current in-house BBC radio producers will find that their jobs are largely going to disappear, because, although a significant number of programmes will be retained in-house, the 60% figure means that the majority will be produced externally.

The question of how the BBC will continue to operate as a major trainer in this area must be raised, because without the numbers, that training might well be at risk. Who else is going to do the training to ensure that radio has a flow of qualified people coming forward? Smaller independent production companies might not be able to scale up either quickly enough or with sufficient range to compete against those that will, perhaps, sweep the pool.

This is a really big change in an important part of our national life—a real adjustment—and it has not been given sufficient scrutiny. Given that it was not discussed in Parliament as far as I am aware and was hardly raised externally, the Government have a duty to think harder about the issues arising. The allegation was made that this proposal did not emerge from any consideration of the needs and purposes of BBC radio production, or indeed the independent radio production sector. In meetings I had with those involved, I was told that the ask for the independent sector was to get from the current 20% of output to 25% by 2020—in other words, a marginal increase on the existing arrangements. To go from 20% to 60% reflects what I think must have been external pressures. That rather makes the point that we need to know more about what is going on, and transparency would help.

The main purpose of the amendment is to focus on the situation that will emerge after 60% of national radio output is put out to competitive tender, and the benefits that will flow from that. I beg to move.

[Lord Foster of Bath (LD)]

My Lords, I have much sympathy with the amendment moved by the noble Lord, Lord Stevenson, although I have some disagreements with it as well, which I will come to. As the noble Lord said, the new charter obligation commits the BBC to extending competition for radio production. It was my understanding that that proposal came directly from the BBC—that it was not, as the noble Lord suggested, imposed on but not necessarily resisted by BBC management. As he said, it may or may not have been rather more than the independent radio producers were expecting or had requested. The Committee would benefit from hearing from the Minister a little about the background to this part of the charter and agreement.

What is clear is that it has been agreed that from April 2017, over a six-year period, the BBC will open up 60% of relevant hours—that is non-news, news-related current affairs or repeats—to competition both from in-house and indie producers. That represents about 27,000 hours of programming per year being open to competition. Although it will not go as far as what is happening in television, it is a further development of the process that began right back in 1992, when the BBC voluntarily made 10% available to independent production. That has developed over a number of years. The 10% voluntary figure was made compulsory, we then saw further developments and eventually the “compete and compare” framework was introduced, designed to drive up standards, reduce costs and ensure continuous improvement in all areas of operation.

Of course, the 60% available for competition does not guarantee the independent sector extra commissions. Independent companies will obviously have to have sufficiently good ideas and be able to demonstrate a track record of producing sufficiently high-quality content. The independent sector, of about 150 relatively small companies spread right across the country, has a growing track record of producing high-quality content and helping to increase the range and diversity of content available to BBC radio services. They produce some great programmes that win awards, and since the guide price for radio production is the same for both in-house and external producers, there is no increase in the production cost to the BBC.

It is good to hear that the independent sector is increasingly involved in training the next generation of producers through training programmes and mentoring schemes, helping to improve diversity: around 60% of learners are women, 15% are from BAME backgrounds, and 5% are people with a disability. But we have to be alert, as the noble Lord, Lord Stevenson, suggested, to the impact these changes may have on the BBC and its own staff. They will certainly need increased levels of training and skills to negotiate, so that they can compete on a level playing field with the independents.

The review that is called for in the amendment is of course sensible, but we question whether it should take place quite as early in the process as recommended by the noble Lord, Lord Stevenson. The 60% target for competition does not come into full effect until the end of 2022, which should provide the independent sector with plenty of time to develop the scale and expertise to pitch to make more programmes. It also allows time for the BBC to retrain and restructure. But the BBC acknowledges that while greater competition should deliver greater efficiency in programme costs, increasing the number of commissions open to competition threefold will require a larger in-house commissioning team, and there is already a potential impact on other in-house staff. I understand that the BBC is already in discussions with staff and trade unions about that.

It would make sense to have a review, but it should perhaps take place at the midway point between Royal Assent and 31 December 2020. If we are to have such a review, we need to look at some other issues that may form part of it, not least the BBC’s commissioning process, to ensure that the developing competition between in-house and independents is truly fair. However, we support the broad principle of the proposed review.

21st Century Fox Takeover Bid for Sky

Debate between Lord Stevenson of Balmacara and Lord Foster of Bath

Monday 12th December 2016 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I thank the noble and learned Lord for repeating the Statement made in response to an Urgent Question in another place. I think a lot of people were concerned to hear last Friday that 21st Century Fox had struck a deal for the total takeover of Sky. Five years ago, a similar bid was abandoned after the Murdoch family and their friends and News Corporation were engulfed in the eye of the phone-hacking storm.

The concerns of 2011 were not just about the serious wrongdoing that was being uncovered by the phone-hacking scandal. They were also about the concentration of media power in fewer and fewer hands. I note that the noble and learned Lord has confirmed that the Secretary of State has power to intervene in certain media mergers on public interest grounds, as set out in the Enterprise Act 2002, and we look forward to having further details about that. I further note that the guidance makes clear, as the noble and learned Lord said, that the Secretary of State will aim to take an initial decision on whether to intervene on public interest grounds within 10 working days of formal notification of a merger to the relevant authorities and such formal notification has yet to be received. We will see how this matter transpires.

There is also the question of whether James and Rupert Murdoch—if they are to acquire the balance of Sky—are fit and proper persons to be licence holders of a regulated television service such as Sky. This is a matter for Ofcom. Last time round, had the bid not been withdrawn, I am sure the noble and learned Lord would agree that it is highly unlikely James or Rupert Murdoch would have passed this test. A lot of water has passed under the proverbial bridge since then, including confirmation of illegal activity, illegal payments and phone hacking in organisations controlled by them. Will the Minster confirm that this fit and proper person test is urgent and that Ofcom needs to attend to it forthwith?

[Lord Foster of Bath (LD)]

My Lords, we too want to see public interest and fit and proper investigations before any merger is given the go-ahead. We certainly do not want to see an American-style Fox News in the UK. We also need to know what the Government are up to to ensure that they are—as the Minister said they intend to be—scrupulously fair. I have one simple question. Given the numerous meetings that have taken place between government Ministers and Murdoch executives and the recent meeting between the Prime Minister and Rupert Murdoch, do the Government now agree that they should implement Lord Justice Leveson’s recommendations 83 and 84 immediately so that minutes are kept of such meetings and the content of the matters discussed made public?

BBC

Debate between Lord Stevenson of Balmacara and Lord Foster of Bath

Thursday 15th September 2016 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I thank the Minister for repeating the Statement on the BBC royal charter and framework agreement. This House has a distinguished record of debates, Oral Questions and excellent committee reports in holding the Government to account over their stewardship of the BBC and broadcasting more generally.

The proposed royal charter and agreement—which, unfortunately, I have not had time to read, though I have read the advance notice of the Minister’s statement, for which I thank him—reflect a lot of what we have been saying in this House over the past year. But in truth, as the Statement concedes, the turning point was the enormous and passionate response to the public consultation carried out by the Government, which forced them to withdraw the worst of their original plans to,

“cut the BBC down to size”,

as the former Prime Minister put it. In the Statement, we hear the claim from the Government that:

“Far from diminishing the BBC, our changes strengthen it”.

The statement goes on to say:

“Our aim is to … improve the BBC where we can”.

How does that sit with the wish for a strong, independent BBC? I am sure I am not alone in feeling that there is a rather chilling assertion behind that statement.

The truth is that the BBC belongs to the people of this country, not the Government: the BBC is the linchpin of the UK’s public service broadcasting ethos and it is the envy of the world. The overwhelming majority of the public clearly want the BBC to continue to inform, educate and entertain and to survive and thrive in the long term. So the key question is: do these proposals strengthen or weaken the BBC?

We set Minsters five major tests for the new charter and agreement. First, we believe that the “Reithian principles”—to inform, educate and entertain—are widely understood and recognised as forming the BBC’s mission. They have stood the test of time, and we do not think that the additional wording to be inserted into the royal charter strengthens the BBC. Indeed, it seems set to weaken it.

We are not entirely clear what this wording is intended to do. The former Secretary of State—praised in the Statement—on several occasions suggested that the BBC should be restricted to “distinctive” programmes, although he never spelled out what that meant other than to hint that the BBC should not produce programmes offered by the other broadcasters and should cease to compete. The “Great British Bake Off” saga may have answered that point. In the time since then, it has become clear that the word is, to all practical purposes, otiose. Therefore, it is not clear what benefits the Government will gain from including the additional wording in the charter. Can the noble Earl give us the rationale for including those changes to the Reithian principles?

Secondly, we agree with the Government that it is right to sort out the regulatory and accountability problems which have hampered, rather than helped, the BBC since 2007. The structures put in place at that time were considered appropriate, but we are content with the leaner and more effective structure that is being proposed and should be introduced under the next royal charter. Also, we agree that Ofcom should become the independent regulator of the BBC. I notice in the Statement that there is to be a short period of transition before the BBC board and Ofcom take on their new governance and regulatory roles. Can the noble Earl confirm that Ofcom will be able to take on this crucial new role, and that it will not be constrained by lack of resources?

Thirdly, the new unitary board must not only be fully independent of government, but must be seen to be so. The agreement makes it clear that all appointments are to be made in line with best practice. Can the noble Earl say concisely what that actually means? The reports that have reached the press about the decision of the current chair of the BBC to fall on her sword, after the Government withdrew what seemed a sensible proposal for her to continue into the new structure, suggest that the Government are paying no more than lip service to the board’s independence. Can the noble Earl confirm that there will be an appointment of a new chair under best practice by the time the new charter comes into effect?

Fourthly, it will be for the new unitary board, independent from government, to set the objectives for the BBC, and there is surely no role for government to specify which channels, particular genres or indeed individual programmes should be included in or excluded from the BBC’s output. In that context, it does not seem appropriate for the Government to require the BBC to publish salary details of its “talent”, particularly when the Government make no similar requirement for other public bodies, or indeed for business or commerce. This smacks of meddling and micro-management; it should be left to the judgment of the new unitary board.

Finally, we called for the charter review process to be decoupled from the general election cycle resulting from the Fixed-term Parliaments Act 2011. I understand from what the noble Earl said that that has been accepted —and we are glad that that is so. I look forward to reading the fine print on this and the arrangements that have been made for the interim review and the licence fee settlement. It is important that they should not be confused.

We welcome the debates that have been promised in October and look forward to them. We also welcome the fact that the Scottish Parliament and the Welsh and Northern Ireland Assemblies will contribute to the debate; that will lead to a much more rounded consideration of the issues before us. When we have these debates in October, I hope there will be an opportunity to look again at the process we have been through in the past two years and whether, for instance, the BBC should, like Channel 4, be given statutory protection rather than a royal charter.

[Lord Foster of Bath (LD)]

My Lords, I, too, thank the Minister for repeating the Statement. I certainly believe that the BBC is the best broadcaster in the world and one of the greatest gifts that we have given to the world, and on these Benches we will base our judgment of the draft charter and agreement on whether they protect the independence, impartiality and popularity of the BBC.

The Government did not get off to a very good start by requiring the BBC to fund free licences for the over-75s. That move has meant a huge cut to the BBC’s income but is also wrong in principle. Government policy should be paid for by the Government through general taxation, not by top-slicing the licence fee.

However, there is much to be welcomed in the draft charter, from the increased emphasis on diversity—which I hope we will see as much behind the camera as in front of the camera—to the scrapping of the BBC Trust, which had the incompatible tasks of being both a flag-waver for the BBC and a regulator of it. Like the noble Lord, Lord Stevenson, I believe that the proposed new unitary board, with Ofcom as regulator, is a far better approach. But while acknowledging that improvements have been made since the White Paper, we believe that all non-executives on this board should be independently appointed, as is the case, for example, with judicial appointments.

The current trust is far less powerful than the proposed unitary board, which will set the BBC’s editorial direction, make key decisions on programmes and even have a say on how the BBC manages news. What defence can the Minister offer to the argument that giving these important powers to, among others, government appointees will understandably lead to the accusation that we are creating a state broadcaster and not a public service broadcaster?

We welcome the 11-year charter period, giving time for the BBC to plan and make investment decisions, but this confidence is potentially eroded by the proposal—not mentioned in today’s Statement—for a mid-term review. Immediately after the next election, this review will take place and the licence fee will be renegotiated. Uncertainty about the outcome of this review and the new licence fee settlement will undermine the benefits of an 11-year charter period. Notwithstanding the assurance that we have had in recent days that the mid-term review will be light touch, what assurances can the Minister give that it will not be used to unpick parts of the charter itself? The mid-term review will also coincide with the end of the three-year trial period for the contestable fund. If the trial is successful and the contestable fund is extended, can the Minister give an absolute assurance that the licence fee will not be top-sliced to pay for it?

However, I believe that the biggest threat to the independence of the BBC comes from uncertainty surrounding government plans to require the BBC to be distinctive. The White Paper said that,

“the BBC should be substantially different to other providers across each and every service, both in prime time and overall, and on television, radio and online”.

While Ofcom is to judge this, the White Paper said that:

“The government will provide guidance to the regulator on content requirements and performance metrics”.

This looks like very direct government interference into the editorial decisions of the BBC—interference that could curtail the BBC’s creative freedom to be popular. Surely that is in conflict with the Government’s stated aim to ensure an independent BBC.

The issue of competition is also a real concern, with the BBC believing that the requirement to name all those earning more than £150,000 will undermine its ability to attract and keep the best talent. Why does the Minister believe that the BBC is wrong?

Finally, I hope that we will have the opportunity not only to consider, as was said in the Statement, the details of the White Paper but to vote on its contents.