Media: Ownership

Baroness McDonagh Excerpts

Thursday 4th November 2010 Lords Chamber

[Baroness McDonagh]

I want to join in heaping praise on my noble friend Lord Puttnam. He has continuously brought to our attention the importance of our creative industry. It is what defines us as a nation and gives a shared identity. It glues us together as a society and as citizens, for which of us here has not heard people talk about Ann Widdecombe’s paso doble on Saturday night—or at least that’s what I thought it was?

Our creative industries define us around the world, and the most important of these creative industries in the UK is television. TV is what we do well, and it is what makes the UK that little bit special. We do it so well we even make money out of it. The UK is the second-largest exporter of television programmes and television formats in the world. This position has not been reached by accident. It has happened by design because successive Governments of all political persuasions have ensured a plurality of ownership across public and private sectors, which means the UK is now one of the few countries in Europe that makes the majority of its own TV programmes.

In this mix of broadcast is our jewel in the crown: the BBC. If I had more time, I would be happy to explain to my noble friend Lord Myners why it is important that it runs Radio 1, but I agree with him that the BBC needs to start speaking up for itself with a stronger voice. It must not be cowed, and it must not allow a small minority to push its programming and technology back into the 20th century. I am proud of the BBC website and the fact it is the UK’s window on the world. It does our economy and our standing so much good. As an aside, I was recently talking to a senior Sky executive, and I asked him whether he was ever worried that he would not have the capacity to cover breaking news. In a flash, he said, “No. We just do what everyone else does; we look at the BBC website”.

The BBC is not a brake on creativity and enterprise; it is the engine room. The BBC trains and puts talented actors, presenters, programme makers, sound engineers, cameramen and entrepreneurs into other broadcasters and independent production companies. That is what gives us the profitable and vibrant sector that we have at home and abroad. We should praise the plurality of our current media ownership and do all we can to protect it.

Much of this debate so far has featured loss of plurality, but the Communications Act 2003 also requires us to maintain a wide range of TV and newspaper companies as well as high-quality broadcasting standards. The latter can mean only a degree of choice that needs to be made and not just brought in. Equally, other legislation requires us to ensure fair competition. If we allow Sky to be bought by News Corp, we will meet none of these conditions. We will create a situation of unfair competition, kill off the plurality that makes us the world’s best television maker and leave the UK with one massive TV and newspaper company.

We have discussed the figures on a gross scale, but Sky is currently a giant, and it does not come cheaply for its customers. The cheapest Sky package at the moment is £284. The BBC licence fee is £140. Sky is not a company that invests much in non-sport UK programming. Last year, it spent more money on marketing than on entertainment and drama.

So let us be realistic about what will happen to our stand-alone publishers, telecommunication companies, broadcasters and newspapers. If we allow the amalgamation of the largest publisher, subscription services TV company and newspaper company, does anyone here think that we will get better TV and better newspapers that will be cheaper for customers? The new giant company will be impossible to regulate. Let us not even pretend we can put in Chinese walls and that everything will be fine. News Corp will be beyond regulation. This is not because News Corp is bad but because it will lead to unfair competition. It would drown out the market. No one would be able to compete against it. Of course, I completely understand why News Corp wants to buy Sky. If I were in its shoes, I am sure I would want to do the same, but it is because these things are not always in the public interest that we have public ownership rules in the first place. It is because some companies are impossible to regulate that we refuse to allow some companies to buy others. Who of us here would allow the BBC to start to publish daily newspapers? We would refuse to allow it, and we should refuse this.

Most of us got involved in politics to be active and to change the world, but sometimes the role of government is to step in to protect and preserve what we have and to prevent something happening. Now is just one of these times. I wholeheartedly welcome today’s decision to refer the matter to Ofcom, but it will look only at plurality, which is a small part of this complex issue. I agree with what Vince Cable said in January, four months before the general election:

“It is time to restore some of the old checks and balances whereby takeovers can be referred to the competition authorities to establish whether they serve the public interest. The Kraft takeover would almost certainly have failed that test”.

I hope his will prevails.