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Mr. Bryant: Will the hon. Gentleman give way?

Michael Fabricant: I have great pleasure in giving way to the hon. Gentleman, who also serves on the Culture, Media and Sport Committee.

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Mr. Bryant: Is the hon. Gentleman convinced by the Towers Perrin report, which recommends—I am not precisely sure what it means by this—a horizontal radio group within the new Ofcom? Will that be sufficient to meet the needs that he mentions?

Michael Fabricant: The hon. Gentleman does not understand exactly what is meant in the report. I suspect that it is referring to the structure that was foreshadowed in the Select Committee report, which said that sub-committees within Ofcom should have definite and different responsibilities for the various areas that it covers. If that is what it means, it is a step in the right direction and one that is necessary to ensure that those interests are well looked after by Ofcom.

The Bill is, of course, a paving Bill only, as the Minister explained. It has been introduced so that people are appointed for when the communications Bill itself goes through Parliament, if indeed it does. Presumably, the communications Bill will be announced in the next Queen's Speech.

I have one or two concerns about the Bill. Clause 1(3)(a) says, innocently enough, that the Secretary of State will appoint the chairman. The current Secretary of State appointed the chairman of the BBC. I said to the right hon. Member for Islington, South and Finsbury that fairness has to be seen to be observed, and it does not help when a well-known subscriber to the party in power is made chairman of an independent broadcasting organisation. Although I do not doubt the independence and integrity of Gavyn Davies, such an appointment does not look good, so the Secretary of State should not be tempted to do it.

Mr. Bryant: Will the hon. Gentleman give way?

Michael Fabricant: With my customary generosity, I give way for a second time to the hon. Gentleman.

Mr. Bryant: I thank the hon. Gentleman for his customary generosity, but I am not going to be generous in return. He witters on about the supposed impartiality of the present board of governors, which has a member of the Conservative party as a vice-chair, but he does not mention Marmaduke Hussey or Christopher Bland.

Michael Fabricant: Apart from the fact that I never witter, the hon. Gentleman has a short memory. He cannot tell me of a precedent where people subscribing to the political party in power have been appointed both as chairman and as director general. That is the imbalance.

Mr. Bryant rose

Michael Fabricant: Much as it is part of my customary nature, I am not going to be generous for a third time.

For that reason, I am worried about the proposal that the Secretary of State should appoint the chairman of Ofcom. As the right hon. Member for Manchester, Gorton said, it is imperative that someone is appointed who can do the job and who is perceived to be politically neutral. The same goes for the chief executive. It would be a sad state of affairs if two of Tony's cronies were appointed to Ofcom. [Interruption.] It is no good Labour Members groaning, because it is precisely that which happened recently with the BBC.

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The issue of the BBC was addressed admirably by the former Secretary of State for Culture, Media and Sport, the right hon. Member for Islington, South and Finsbury. The Bill does not give equal control of the BBC. The Minister admitted as much. As I said in an intervention, the BBC's briefing notes give all sorts of spurious reasons why it should not be governed by the Ofcom board.

It is true that ultimately the Secretary of State can intervene, but that is the nuclear option. No Secretary of State anxiously intervenes on the BBC for a number of reasons. To be most charitable, the Government would not be seen to be supporting the independence of the corporation if they constantly intervened in the operations of the BBC. It is in the interests of this and future Governments that there should be vicarious control through Ofcom. There is no reason why Ofcom cannot have the same controls over the BBC as it will have over other public service broadcasters.

The BBC often claims, and it is frequently repeated in the House, that it is the only public service broadcaster in the United Kingdom. That is not the case. Many excellent programmes are produced by Channel 4 and ITV. They are occasionally produced even by Channel 5 and, perhaps, by Sky, which has spent a lot of money on the film industry. It is perfectly acceptable to say that those broadcasters are also public service broadcasters, the only difference being that one group is funded by advertising and subscription while the other is funded by the licence fee payer. The fact that they are funded differently does not of itself mean that the BBC can enjoy a monopoly on the "public service broadcaster" epithet.

The BBC should be controlled by Ofcom. Not only would that give it independence from the Government, who would not be seen to be in control, but, far more important, it would give the impression that the BBC was not being its own judge and jury. That has been the greatest criticism of the BBC. Even when the board of governors makes judgments about programming, which it is right to do, people still doubt whether its decisions are independent because it is an integral part of the BBC and appoints the board of management.

Dr. Howells: Is the hon. Gentleman saying that it is a problem of perception rather than of fact, and that previous Conservative Governments—no more than this Government—never sought to control the BBC?

Michael Fabricant: To a large extent I am talking about perception. Let me be clear about this. On the whole, the BBC does govern itself well. I am not attacking it, and I do not share all the views of the Chairman of the Culture, Media and Sport Committee on the BBC. As I said, I do not believe that it should be privatised; nor do I believe that its board of governors are especially arrogant or especially neglectful of their duties. What I do believe is that justice has to be seen to be done, and that is not the case when the BBC is its own judge and jury. That is why I am calling on the Government to ensure that Ofcom has the same rights of control over the BBC as it does over independent broadcasters. For the reasons that I have given, which I shall not rehearse again, it would be to the Government's advantage if they did just that.

As my hon. Friend the Member for South Suffolk (Mr. Yeo) said, those on the Conservative Front Bench are considering whether Channel 4 should be privatised.

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I have the luxury of not being on the Front Bench. When Channel 4 was established, it was set up and owned by the Independent Broadcasting Authority because it was thought that it could not make a profit. People underestimated the great power, strength and ability of Michael Grade. To me, it is a great pity that Michael Grade is not currently involved in broadcasting. Now, there is an idea for the great and the good—an idea for someone to be chairman of Ofcom.

Michael Grade changed Channel 4 so that, far from Channel 4 having to be subsidised by ITV through ITV revenues paid to the Independent Broadcasting Authority and later the Independent Television Commission, it is now Channel 4, through its advertising revenues, which to some degree subsidises independent television, by virtue of the fact that ITV fees are reduced because of the contribution made by Channel 4. [Interruption.] It is indeed a subsidy: ITV pays less because Channel 4 is making a contribution to the ITC.

Mr. Cameron: There used to be a subsidy under the Channel 4 funding formula, which has been abolished. It was set up so that ITV could support Channel 4 or Channel 4 could support ITV, but that has now gone. The ITV companies all pay contributions to the Exchequer; Channel 4 does not.

Michael Fabricant: My hon. Friend is missing the point. ITV companies do, however, pay a fee to the funding of the Independent Television Commission, and Channel 4's profits go to the ITC because it is owned by the ITC. I am merely observing that the contributions that need to be made by ITV companies to support the ITC are less because of the profits made by Channel 4. That is straightforward and simple enough. I see that my hon. Friend disagrees with me, but if he checks in the Library, he will see that I am right.

Channel 4 meets its programming requirements as set down by Parliament, yet it makes a profit. There is no reason why Channel 4, which is now, in effect, a nationalised industry through the Independent Television Commission, cannot be privatised. The money resulting from that privatisation could be put into the Exchequer or better still, could be ring-fenced, possibly to support still more public service broadcasting by ITV or other organisations. Parliament could still maintain strict controls over the programming remit of Channel 4, as it does at present, to ensure that Channel 4's programming does not suffer as a result.

Mr. Wyatt: The hon. Gentleman is generous in giving way. He mentioned in an intervention that £3 billion could not be found to privatise the BBC, so how would he find £1 billion to privatise Channel 4? He cannot have it both ways.


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