Public Service Broadcasting (Communications Committee Report)

My Lords, we are all grateful to the noble Lord, Lord Fowler, for his presentation of the report, his introduction of the debate and his chairmanship of the Select Committee. The committee has produced a timely report because the House will recognise that the final report on Digital Britain will be produced soon and it which will take account of all these representations. The House will readily appreciate, however, that I am somewhat inhibited by the fact that that is only nine or 10 days away, and it ill behoves me to pre-empt its conclusions. I hope that I will be forgiven if I cannot be as definitive in response to some of the proposals as I would ordinarily like to be. The advantage of the report being presented at this time is that it helps the Government’s thinking on these critical issues, and I am grateful to the noble Lord and his committee for clarifying some of those that need to be addressed. I emphasise that I have some difficulty in reconciling the anxieties of the committee, which are well founded in certain areas of television production. We are all aware of the problems of advertising revenue in view of the competing areas in which advertising can be presented to television. We are all aware of the fact that ITV and Channel 4 are under stress. The noble Lord, Lord Fowler, with his considerable experience in an additional area of news—the regional newspapers—brought that within the framework of this discussion. I appreciate that the noble Lord, Lord Inglewood, has had to leave before this response, but he, too, emphasised the difficulties facing independent television in particular. I am having a little difficulty in accepting the analysis of the noble Baroness, Lady Rawlings, that all is fine in the garden, that there are not too many problems around and that a little slicing off the BBC budget will produce an easy answer to all that. First slicing the BBC budget is not a concept that I recognise, having listened to and participated in debates on committee reports in the past about the role of the BBC. I was greatly involved in the debate on the charter, the difficulties in that institution and the necessary resources and, as testified in the debate today, how well those resources are devoted to ensuring that the BBC is the foremost broadcaster in the world with a substantial role in exports, which also enjoy such a huge reputation. I listened carefully to what my noble friend Lord Puttnam said about the history of the BBC and its somewhat jealous guarding of its resources. He is right that that should be subject to scrutiny. It may be timely that the BBC has to be a little more open to its potential rivals. In all fairness, he will have recognised areas in which the BBC is already beginning to think of partnership with independent television with regard to news provision. All is not closed on that front, nor let me say are the Government closed on the necessity of some further stimulus towards such co-operation. The committee is right to identify that there may not be a long-term crisis in British television, but there are short-term anxieties given the real difficulties at this time. The full report, for which we have less than a fortnight to wait, will address all those issues. I can dispose of one or two issues. The noble Lord, Lord Clement-Jones, was fair but challenging in almost equal measure. He is always fertile with fresh ideas or, if not, indicating that he sees little difficulty in ideas that have been rejected. I fear that product placement fits into the latter category. The Government gave detailed consideration to all the responses on the issue, but we have not been persuaded that there are any convincing arguments in favour of allowing product placement. Although, as the noble Lord rightly enjoined the Government to do, we will address ourselves to the issue of necessary funding, we do not think that that is an avenue that can be usefully pursued, and we will not be emphasising that dimension. The BBC is important as a global force producing wide-ranging programmes of quality and innovating successfully in new forms in today's multimedia, multiplatform age. We all recognise that public sector broadcasting gives a unique advantage to this country. It is important that the BBC has strong competition from the commercially funded public sector broadcasters: ITV and Channels 4 and Five, which, first, help to keep the BBC on its toes and, secondly, ensure that we get the most innovative and creative possibilities for our television. ITV's regional news provision provides audiences with a different perspective from the BBC and provides a balanced view reflecting communities across the country. As the noble Lord, Lord Fowler, said in his opening remarks, it is important that we recognise that with regional newspapers under pressure, the regional dimension of news is of considerable importance. The noble Baroness, Lady Howe, and the right reverend Prelate the Bishop of Manchester emphasised the importance of children's programmes. There was scarcely a mention of Channel Five in the debate, but we should pay due regard to the "Milkshake" brand on Channel Five, which provides high-quality organised preschool programming for children. Although I appreciate that there is concern about the quality of provision for over-10s—I think that the noble Baroness defined it in those terms—we should appreciate programming of high quality. There is no doubt that children's programming must be an important dimension of public sector broadcasting, but a degree of competition ensures plurality of voices and competition for quality which, in turn, drives down some costs. The challenge for the Government is to examine how we could sustain public sector broadcasting provision, including the BBC, in the new multichannel digital age with all its challenges. The Digital Britain interim report, which we published a few months ago on 29 January, set out our early thinking on these matters and outlined the key priorities that we think need to be addressed. Our starting point was certainly that a strong, fully funded and efficient BBC acts as an enabler for the rest of the sector. Most of the fruitful ideas that have emerged from the committee’s useful report and that have been presented during this evening’s debate, build on the BBC as the cornerstone. However, we also need strong alternatives to the BBC. My noble friend Lord Macdonald emphasised that in relation to the provision of television in the nations. He will appreciate that aspects of the relationship between ITV and the channel 3 licensees as a whole are essentially regulated by Ofcom and the OFT. In 10 days’ time, we will set out in Digital Britain our views about how we see that relationship developing, but I reassure my noble friend that his strong voice on the necessity of ensuring that this dimension of public sector broadcasting is given due attention will be testified in that report. I know that noble Lords will take the earliest possible opportunity of pressing the issues further. Underpinning the initial position is the Government’s belief that public sector broadcasting requires plural provision. Where there are anxieties about public sector broadcasting outside the BBC, we need to address them. That is why I am grateful that this debate gives us the chance to do so. The committee argued that to deviate from the current, accepted definition of public service broadcasting would be counterproductive, and we agree. It is the cornerstone of this debate. There are enough challenges with regard to the points that have been made in the committee’s report and in this debate without us wrangling over definition. We believe that the concept and framework that we set out in the Communications Act 2003 and the characteristics and public purposes put forward by Ofcom provide the proper starting point for examining public service content, and we are grateful to the committee for confirming that that is how it sees things. In response to calls for plurality of public service broadcasting beyond the BBC, let me restate that we have repeatedly given our firm commitment to sustaining public service content provision including and beyond the BBC, which is why we address the issues that the committee identified. It will be seen from the Government’s response that we seek to respond to them positively. I am grateful to the noble Baroness, Lady Flather, for introducing the issue of diversity. Plurality of sources does not meet the requirement if we do not have plurality of voices and do not give due regard to minority cultures. I am grateful for her contribution on this matter, just as I am grateful to my noble friend Lord Macdonald for expressing a similar viewpoint with regard to the nations of the United Kingdom and how they need to be considered as we conclude our thinking. Following Ofcom’s public sector broadcasting review, the Government have been looking at a number of options, including the feasibility of contestable funding, structural changes, new networks or commissions or making no further intervention in this market at all. I am glad that the committee did not think that the last was an option for the Government, because we will be positive in the final Digital Britain report, which is imminent. The Government, like the committee, welcomes the BBC’s commitment to commissioning more network programming from the nations. The timetable and the commitment are a matter for the BBC, and we should support the BBC’s endeavours to reach its targets as quickly as it can. Particular reference was made to Channel 4, not least by my noble friend Lord Lipsey. We noted that Ofcom, in its final PSB statement published in January, recognised that production from and portrayal of each nation and region of the UK on UK networks was a concern for many, which is why Ofcom decided to increase Channel 4’s out-of-London production quotas to 35 per cent in spend and volume. Within that they also embedded a quota for 3 per cent for production from Scotland, Wales and Northern Ireland. But that is a demand on Channel 4. My noble friend Lord Lipsey was eager to identify that Channel 4 also needs some support, which is why I emphasise that in 10 days’ time we will identify progress on these matters. I cannot adopt the somewhat complacent position of the Opposition Front Bench with regard to the challenge facing ITV in terms of resources. But I want to emphasise—I am sure that the noble Baroness, Lady Rawlings, will join me—that independent television is a tremendously important dimension of our broadcasting world. ITV1 remains the UK’s largest commercial channel. In 2008, it achieved an audience share of 17.2 per cent, which is more than twice the share of its nearest commercial rival, Channel 4. It should be therefore recognised for its significance. Across peak viewing hours, ITV1 remains the UK’s most popular channel with a share of 23.9 per cent, which is slightly ahead of BBC1 with 23.4 per cent. We should recognise how much independent television and ITV1 are appreciated by the nation. Of course, it has held its share of the television advertising market over a long period, despite the fact, as we all appreciate, that there are now competitors outside linear television which help to create the present difficulties. ITV’s commitment to public service content has not only contributed to sustaining a wide range of voices and perspectives, but it has also helped to improve the standards of the UK media landscape. I believe that independent television not only has played a significant role in the recent past, but that that role needs to be sustained. However, content markets are changing significantly with the development of alternative viewing patterns, which is why the committee’s report talked in terms of short-term crisis and why I am pleased to report both the committee’s constructive response to some of these areas and that of other noble Lords. The noble Lord, Lord Clement-Jones, was concerned to emphasise partnership and the Government certainly think that that needs to be exploited and developed. I also accept that the regulatory framework that applies to ITV may need to change further to reflect the changes in the media landscape. My noble friend Lord Macdonald made that point with great force. I cannot comment in detail without pre-empting the more general position to emerge shortly. But that point is very well taken. Of course, I want to emphasise that the Government are considering a new entity which builds on Channel 4’s assets from purely public ones to perhaps public-private partnerships to achieve our objective of a large-scale, sustainable and flexible provider of high-quality public service content. I know that that is too general an expression to satisfy my noble friend Lord Lipsey who would want me to be more precise about the commitment to Channel 4. I can express only this general commitment, but he knows that that presages a considerable degree of detail in the report, which we all await with, I have no doubt, considerable impatience. However, I have greater patience than many because it enables me on this occasion to postpone conclusions on some of the more difficult issues. My noble friend Lord Carter will address these issues before the House in the near future. In conclusion, changes are required in the commercial broadcasting sector if we are to secure the plurality of provision that both policymakers and audiences want. Our aim is to build on the strengths and traditions that will redefine and meet the very new and challenging digital age. Government intervention in the marketplace is difficult to determine and I am grateful to the Select Committee for recognising the difficulties in its report and recommending that we tread with delicacy and care. There is no easy, overriding and simple solution for this area. We need to think carefully before we tread at all, and of course, at the heart of this lies the crucial question of affordability. The Digital Britain agenda is ambitious and encompasses public service broadcasting along with the wider digital and creative industries. The report is imminent and I know that the House is looking forward to it as much as I am. For the moment, I can only express gratitude to the committee, which has advanced the debate considerably with this report.