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Lord Montague of Oxford: My Lords, is it correct that this game is due to be played out at the weekend and what does my noble friend forecast will be the outcome?

Lord Simon of Highbury: My Lords, it is incorrect to say that it will be played out at the weekend. I have no knowledge other than that there was a month's interregnum from the date and therefore, theoretically, the matter could run until the end of the month. The Americans are currently on their negotiating rounds. The noble Lord may be right, but that is not my understanding of the negotiating period.

I was told, generously, that I should have slightly longer than 15 minutes to reply because the noble Earl, Lord Dartmouth, had decided not to speak. Perhaps I may turn to the issue of comprehensive multilateral trade negotiations. As many speakers, including the noble Baroness, Lady Young, and the noble Lord, Lord Shore, said, these are crucial. Trade liberalisation remains vital. It is as important today as it was 50 years ago when the GATT was first founded. Growing protectionist pressures, about which we are all presently worried, trade reshuffling and the large swings in trade balances with which all countries are currently coping, increase the urgency and need for a further boost to economic growth. Some have wanted us to stimulate extra growth in Europe; others believe that a bilateral negotiation between the US and Europe on growth will be important. I believe that both will be important.

This is a welcome and timely opportunity to comment on the Government's support for the next comprehensive round of trade negotiations, the so-called millennium round, which we hope will be launched at the WTO ministerial conference in Seattle at the end of this year. It will be the third ministerial conference: the first was held in Singapore in December 1996; the second took place in Geneva in May last year. We believe that a comprehensive round from the Seattle process would allow countries, including the developing countries, to obtain an overall package which could reflect a broad range of interests, largely because of the political impetus that has just been described, the current state of world trade balance and imbalance; and for that reason it will allow trade-offs across a very large area of trade at this time.

Some question the wisdom of pressing ahead with trade liberalisation proposals at a time of difficulty. But trade policy was not the cause of the Asia crisis; nor does it provide a complete solution. It can, however, help the world on the road to recovery. We believe that freer trade, as has been explained, has brought substantial gains to the global economy in the post-war era. We know that the Uruguay Round brought significant boosts to world trade and incomes. We have all learnt the key lessons of the 1930s, of which we were reminded during the debate. That is why the UK and the EU have pledged to resist protectionism and are at the

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forefront of efforts to secure a new round of multilateral negotiations. We have a very long "wish list"which I shall not go through now.

Sustainable development was mentioned by a number of noble Lords. The Government are committed to sustainable development. Protecting the environment and maintaining an open, non- discriminatory and equitable multilateral trading system are both essential to achieving that objective. There are many effective, internationally recognised measures that aim to protect the global environment. There is more to be done, although significant progress has been made in the past 20 years. The multilateral environmental agreements now in place are solid steps. Liberalising trade will help to ensure that resources are used efficiently. It helps to generate the wealth that is necessary for development and environmental improvement. The two run together in our minds. From a business point of view, the spread of clean technology is a real business option which we must underpin with rhetoric and use in taking forward new developments in technologies and companies. It is a positive option.

I conclude by re-emphasising a general point about the place of disputes in the EU-US trade relationship. The vast majority of substantial EU-US trade and investment flows are not affected by transatlantic disputes, despite what the headlines might encourage us to believe. Disputes are rare. Without wishing to minimise the individual importance of the particular issues on which I have touched, there is a danger that we could colour the overall relationship unfairly. It is important that when disputes arise all parties should try to keep the temperature down and look for workable solutions rather than responding with knee-jerks and heavy rhetoric. I hope that the TEP will be good in that process.

As I said, US action in the banana dispute has been regrettable. But to be blunt--and as many noble Lords have observed--the EU negotiating position prior to losing this case did not enamour the US to our approach. Let us hope that, for major trading partners, we can now cut through that, solve the problem and look for practical solutions. It is all the more important because the two partners, the EU and the US, enjoy a massive, dynamic bilateral relationship which is crucial to every other trading partner in the world.

6.25 p.m.

Lord Clinton-Davis: My Lords, the House will be disappointed to know that I have only 42 minutes for my concluding remarks! I was pleased to have the opportunity to initiate this debate. I have in no way been disappointed by the outstanding contributions that it has elicited.

I know it is invidious to mention individuals, but perhaps I may echo the words of my noble friend Lord Simon in expressing delight at seeing the noble Baroness, Lady Denton, in good form on the Front Bench. She is a very good friend. Perhaps I may also

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mention my noble friend Lord Shore. It is about 25 years since he used to open, and I used to wind up a debate. It is almost a lifetime.

I have greatly admired the breadth and profundity of speeches in this debate. So much individual expertise was brought to it, making it of collective value to the Government in seeing the position taken up by noble Lords on all sides of the House. That will win me no enmity at all, but my response is genuine.

The other central feature was an understanding that no one could claim complete triumph one way or the other in the negotiating postures that have been undertaken in relation to a wide variety of problems. It is not triumphs that we want; it is comprehension of each other's points of view, ensuring that the dispute resolution process, whatever its faults, is honoured. It has taken a long time to build it up. It is effective compared with the GATT process.

It is also important to ensure that the developing world plays a part in this process. We must never forget the role that citizens across Europe and the United States, and wider, are entitled to play. If there is no understanding on their part of the issues, yet there is the knowledge that they will be vitally affected, it is easy for hostility to occur towards the process that I so greatly value and the noble Lord, Lord Simon, values on behalf of the Government. It could be placed in jeopardy, and that would be a great tragedy.

My noble friend Lord Simon brought characteristic experience and breadth of vision to his concluding remarks. He emphasised how important it is to embark upon a successful millennium round. The stakes are high. The process of engaging in proper preparation for the millennium round was emphasised vividly to me when I had the honour of being a Minister at the Department of Trade and Industry. We tried to ensure that the mandate that we gave to the Commission was one which, using our best endeavours, could produce the right kind of result. I think that Leon Brittan, as commissioner in charge of this negotiation, has handled the matter with great skill. I hope that he will continue to do so in the short period before he gives up his mandate.

I profoundly thank everyone who has participated in the debate and hope that the Government will find that it will have been of considerable value to them in understanding the tenor of the debate which was free of rancour and which did this House proud. My Lords, I beg leave to withdraw my Motion.

Motion for Papers, by leave, withdrawn.

Digital Terrestrial Television

6.30 p.m.

Viscount Astor rose to ask Her Majesty's Government what plans they have to enable digital terrestrial television to be broadcast throughout the United Kingdom.

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The noble Viscount said: My Lords, my Question this evening is on rather a technical subject, so it has encouraged interest from the noble Lord, Lord Thomson of Monifieth, who is a great expert on the world of television and has had a long career in it. It also allows the Minister and my noble friend to speak and I look forward to both speeches.

We have a modest number of speakers which means, if nothing else, that no one has to worry about the length of their speeches. The short debate this evening may be a precursor to the debate on 5th May that the noble Viscount, Lord Falkland, has put down on digital television as a rather larger issue. Terrestrial digital television was launched last November by Ondigital. It added a fourth dimension to broadcasting in this country. At this stage I must declare an interest as a director of Ondigital.

Perhaps I may start by briefly trying to cut through the technology jargon and set the scene of where this new service sits in the modern broadcasting world. It is a world where the consumer, the viewer, now has more choice than ever before. Your Lordships will have grown up watching analogue television. The first television broadcast was made by the BBC as long ago as 1936. ITV did not come along until 1955, BBC2 in 1964, Channel 4 in 1984 and finally Channel 5 in 1997.

Analogue television, which is television as we have known it, now covers 99.4 per cent of the population and there is hardly a household--of which there are 23 million in this country--without a television set. The BBC is funded by a licence fee of £101 which brings it an annual income of over £2 billion. ITV, which collectively pays about £400 million to the Government for its licence to broadcast, is funded by advertising. Channel 4, with its special remit, pays no licence fee and is also funded by advertising, as is Channel 5.

The 1996 Broadcasting Act, introduced by the previous Government, brought in the principle of terrestrial television and also the principle that at some point in the future analogue television would cease to be broadcast--what is known as the "analogue switchover". Digital television has many advantages. It uses much less spectrum and, by using digital compression technology, more channels can be broadcast, including interactive and Internet channels. This therefore frees up spectrum for other uses, such as radio and mobile telephone uses, and also a future financial benefit for the Treasury by its sale or leasing of spectrum of possibly up to £7 billion.

Before I go further, what of the rest of the broadcasters? The second system your Lordships should look at is satellite. BSkyB started broadcasting in 1989. It introduced digital satellite broadcasting last year, which has increased its number of channels to 200. It is a huge success, now 10 years old. I congratulate it. Of course, it pays no licence fee to the Government and has the advantage that it has the cheapest form of delivery system. That is why BSkyB has made a fortune for Rupert Murdoch; it is now worth £9.2 billion. News International's share is worth £3.5 billion. BSkyB has not been without controversy and has been the subject of much debate in this House and elsewhere.

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It has 3.5 million subscribers and I am sure that will grow, but it is a mistake to believe that it will be available to everyone in the country. About 30 per cent. of households in the country cannot have a dish. The reasons vary; it may be because of planning rules in conservation areas or other building restrictions.

The third broadcasting system is cable. The cable industry started in a major way in 1983 with 11 companies competing. The cable industry has contracted and is now controlled by three companies: NTL, Tele West and Cable and Wireless. Cable is theoretically available in about 45 per cent. of all households in this country, but the actual take-up is about 23 per cent. of that 45 per cent. It has become well established and after the initial rows about streets that seemed to be permanently dug up and trees dying it now goes well.

It must be said that cable companies seem now to be more interested in competing in telephony services and interactive services, rather than extending their broadcasting activities. Unlike terrestrial television, BSkyB or Ondigital, cable companies are now just methods of delivery. They commission no programming, taking programmes from other broadcasters.

I believe that briefly sets the scene, so I will return to terrestrial digital. It is broadcast through a "thing" called a multiplex. I have asked whether there is a better description of a "multiplex" but have been unable to get it, so, for my benefit, I shall have to call it a "thing", there is no other way. I am sure there is a technical description which perhaps the noble Lord, Lord McIntosh, might know.

The BBC has the multiplex with the best reach; the next best reach is the one for ITV and Channel 4, then SDN which carries Channel 5. Ondigital has three out of six for its services. Each multiplex sends its signal via cable to 81 transmission masts throughout the country and the masts are then used to broadcast the signal which is received by an ordinary television aerial, then to a set top box which is plugged into the television. In the future it will go straight into digital televisions when they become available.

Ondigital is currently broadcasting 18 channels and could in the future raise the number to 30. E-mail via the television screen will become available this summer as a first step to wider Internet services--for example, home banking. Multiplexes, the "thing", the "beast", have different ranges and power. At the moment, digital terrestrial television coverage ranges from 90 per cent. for the BBC to 73 per cent. for Ondigital. While that will increase this year, the important question to which the Government and the industry must give an answer is how to equal the current analogue coverage of 99.4 per cent.

What can the Government do to allow this to happen? I believe there are three separate measures which the Government should consider. The first and most important is that the Government must announce a date, even if it is only a target date, for the analogue switchover. I suggest that that could be anywhere from 10 to 15 years from now; that is, 2010 or 2015. It is not important what date it is; it is important that a date be announced. That would, I believe, bring significant benefits to the consumers, to the industry and the Government.

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Manufacturers would then mass produce set top boxes and digital boxes; costs and prices would rapidly come down; and consumers would accelerate their take up of the new technology. All broadcasters would be able to develop and improve their digital services.

When setting a target date, the Government should set up a working group to monitor the progress each year and, most important, list the conditions that will have to be fulfilled before the analogue switch over begins.

The second measure I believe the Government should consider is that the switch off should be phased in by regions, perhaps England, Wales and Scotland. A rolling switchover would allow that spectrum to be used to improve digital coverage which would allow transmitters already used for radio also to be used for digital television.

The third measure is the addition of further transmitters. I understand that the ITC has produced research to show that the establishment of a further 120 masts will bring digital television to a million homes in the Midlands alone. I believe that the Government could start to address the problem now. It is a complicated issue that involves two regulatory bodies and two departments. The Radiocommunications Agency is a responsibility of the Department of Trade and Industry and the ITC is a responsibility of the Department for Culture, Media and Sport. However, Chris Smith, the Secretary of State, has recently announced that he is to set up a regulators forum to improve co-operation between the regulatory bodies involved in broadcasting: the ITC, the radio authority, Oftel and the Broadcasting Standards Commission.

The ITC has recently published research which indicates that coverage can be improved. The BBC has also committed itself to develop further plans for digital. Despite having £400 million set aside--£250 million from keeping the receipts of the sale of its transmission system and £150 million from savings that it has been able to generate--the BBC appears to have a funding gap in its digital roll-out. That is also an issue that the Government will have to consider. Various suggestions have been made. One is that the licence fee should be increased by £39.

What is important is that the Government must allow industry to improve coverage so that in future through one of the three platforms that exist in this country the 0.6 per cent of homes in this country that have never received any television at all can receive some. A review of the points system and its classification would also be useful.

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