Deregulation Bill

Debate between Kelvin Hopkins and Helen Goodman

Monday 23rd June 2014 Commons Chamber

[Helen Goodman]

I want to speak to the amendments in my name and that of my hon. Friend the Member for Newcastle upon Tyne Central (Chi Onwurah), as well as to the Government amendments.

Clause 54 puts a duty on the Secretary of State to review the sanctions on those who own a television but fail to pay the licence fee. Our amendment would require the Secretary of State to lay the review’s terms of reference before both Houses. Clause 55 gives the Secretary of State a power to decriminalise sanctions on those who fail to pay the licence fee. Our amendment would prevent this power from being used before the completion of the next review of the BBC’s royal charter.

The BBC is a universal service, and the licence fee is a universal payment for anyone with a television. The licence fee is not a tax; it is a guarantee of the BBC’s independence. The BBC is the most trusted source of news in the United Kingdom, with 58% of people rating it as their most trusted news source.

[Kelvin Hopkins]

Does my hon. Friend agree that the BBC is trusted not just in Britain but across the world, and when other broadcasting services are compared to it, they take it as flattery or a compliment?

[Helen Goodman]

My hon. Friend is absolutely right. The BBC is now one of the great British brands and it exports across the world.

In the evolution of British broadcasting, the licence fee has gained broad support. Nearly everyone in the UK uses the BBC each week—it has 97% reach—which helps to explain why support for the licence fee is at 53%, up from only 31% in 2004, and is ahead of the 17% support for subscriptions and the 26% support for advertising. It is the top choice for funding the BBC across all ages and all socio-economic groups, whether people are in Freeview, Sky or Virgin households.

Not just the public but other broadcasters appreciate the licence fee, since they have built their business models using finance from advertising, sponsorship and subscription on the assumption that the BBC will not enter those markets and that, as a result, the size of those markets will be fairly stable. Labour believes that the licence fee is the best funding model.

[Kelvin Hopkins]

I apologise for intervening again so quickly, but I want to reinforce my hon. Friend’s point. The fact is that we have quality television across the piece in Britain because of the BBC. If it were not for the BBC, standards might drop severely.

[Helen Goodman]

My hon. Friend is absolutely right. No one wants people to go to prison for non-payment of the licence fee. Last year, 165,000 people failed to pay, and 51 were jailed for non-payment of the associated fines, even though people can pay by instalment. Clearly, we need some sanctions to ensure payment. The question is whether the current sanctions are the right ones. That is why we have agreed to a review of the sanctions.

Our amendment 62 would require the Secretary of State to lay the review’s terms of reference before Parliament, because we want a proper, analytical and unbiased review. I wrote to the Solicitor-General’s colleague, the Under-Secretary of State for Culture, Media and Sport, the hon. Member for Wantage (Mr Vaizey), who has responsibility for communications, about this matter on 7 April.

Such a review should cover the impact of a change on the level of licence fee evasion. It would be helpful to have historical data on evasion rates. According to the TV licensing database, the statistics on the socio-economic background of unlicensed properties show that 38% are ABs, 29% are C1s, 13% are C2s, 8% are Ds and 11.5% are Es. Those figures are broadly in line with the socio-economic background of UK properties as a whole. That does not translate to the socio-economic status of those prosecuted or imprisoned for non-payment of the licence fee, but it indicates that there is higher evasion among better-off households.

The review should cover the impact on the BBC’s finances. Without that information, we will not know the full impact of evasion. Estimates suggest that a 1% increase in non-payment might lead to a £35 million loss to the BBC. It has said:

“If Licence Fee evasion were to double to around 10%, the BBC would have an estimated…£200 million less per annum for content and services—equivalent to the combined budget of BBC4 and our two children’s channels, CBeebies and CBBC, for example. Due to low rates of evasion at present, an additional £6.7m was available to spend on BBC content in 2012/13.”

Obviously, if evasion went up, such investment would no longer be possible.

The review needs to look at the impact of new technology and the possibility of ending the BBC’s universal offer. Currently, the BBC cannot switch off the signal, so what would happen if it could?