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Lord Razzall: I support the amendment from these Benches. I will not delay your Lordships by repeating the arguments put forward by the noble Lord, Lord Puttnam, and the Tory Front Bench, but I would like to add two or three points which have not been made so far.

It is important to indicate why there has always been concern about newspaper proprietors owning television stations in this country. That does not amount to an attack on Sky. I take the point that was made by the noble Lord, Lord Lipsey, that there is no indication as to whether Sky and Rupert Murdoch wish to acquire Channel 5. The underlying concern that one has about newspaper proprietors owning TV stations or broadcasting media is that, by and large—and it is more large than by—newspaper proprietors

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and people who buy newspapers tend to have something of a political agenda. We have only to look at our media and newspapers run by Members of your Lordships' House to realise that there is a significant political agenda behind newspapers. There is a significant political motive, quite often, among people who own newspapers. It was for that reason that, in the past, governments of both political persuasions have not been convinced that it is a good thing for newspaper owners also to own television stations.

My second point relates to the comments of the noble Lord, Lord Lipsey—and this argument has raged significantly in the run-up to the Bill. As I understand it, the Government's position is that, these days, ownership does not really matter, because what really matters is regulation. I suspect that that is the argument that the Minister will make against the amendment. I have heard people extremely close to the Prime Minister ask why so many people bother about the idea that Mr Murdoch and Sky can control a television station, because, after all, that can always be dealt with by regulation and ownership does not matter. The concern that we on these Benches, as well as the movers of the amendment, have is that that is a pretty big risk to take, bearing in mind the known motivation of newspaper proprietors with regard to the ownership of their newspapers.

Finally, once governments cross the threshold of allowing newspaper proprietors to acquire Channel 5, the intellectual argument will be lost that ownership matters in relation to TV stations. If, as is perfectly possible, we end up in a world in which the BBC is on one side, Sky TV on the other, and a failing ITV as a result of a collapse in advertising revenues, what will be the argument against allowing Sky then to say, "We can buy ITV"? I know that there will be competition and regulatory issues, and great hoops that will have to be jumped through, but once the intellectual step is taken to accept that a newspaper proprietor can own Channel 5, what will stop the same argument being used for that newspaper proprietor also to own Channel 3?

Lord Bragg: I rise to support the amendment of my noble friend Lord Puttnam and much of what other noble Lords have said. Like many other noble Lords, I seem to have been talking about this all day, every day, so I shall be as brief as I can.

There are two reasons why I fear this part of the Bill if it is not amended. The first reason involves the domino effect, which works in British television. We can give instance after instance of that. Basically, various channels are competing for a single, finite market, and one gains at the expense of the others. As has been pointed out, if Channel 5 has very few obligations and regulations compared with the other main terrestrial channels, and money and influence are pumped in by what could be called a cross- media owner, there is no doubt whatever that it could and would grow like a rocket. Judging by the stuff that has been shown, which is not expensively made—some of

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it is okay—Channel 5 could grow comparatively cheaply and bring in audiences. That would seriously disturb the current balance.

Does that matter? I believe that it does. Can that be stopped by putting in a ratchet? Would all the regulations come in if the service got 10 per cent? That is like trying to put the genie back in the bottle. I do not know how one does that or when 10 per cent would have been reached. People could say, "In August, we were at 8.2 per cent. We managed to get 11.5 per cent in November, but that was only because of what we showed. We should not forget the situation back in January". They could play around like that for years. I do not believe that the ratchet effect would work at all. It will take all of Ofcom's efforts just to put a ratchet effect on someone who was determined to make Channel 5 grow and had the power to keep it growing. I do not believe that a ratchet will work; it is a non-starter.

What I believe will happen—my noble friend Lord Puttnam referred to those of us with some experience in this regard—is the domino effect. Channel 5 will grow and grab audiences. It will go head to head with Channel 3, which is where it will try to get its audiences. It will get those audiences, and Channel 3 will have to fight back. The way to do that is to do two things: one makes things more cheaply and one offloads the cumbersome and expensive programmes, which, by and large, are one's public service responsibilities—classic dramas and programmes that take a lot of money. One can always make them more cheaply, as I said earlier. One can make drama and documentary cheaply but one then gets a cheap system. Channel 3 will have to fight back in relation to the new Channel 5. BBC 1 will have to follow Channel 3. Channel 3 must get its money; that is its obligation to shareholders. BBC1 must get sufficient viewers for a sufficient amount of time to justify everyone in this country paying a licence fee. It has very little room for manoeuvre in that regard and will have to fight back in the same coin. Those three bodies will compete for the same market and the audiences will drop on Channel 3 and BBC1. Moreover—I said that I should be brief and I will be—Channel 4 and BBC2 will suffer even more. I make that assertion and am quite prepared to discuss it at greater length if noble Lords want to do so. I hope that noble Lords follow me in that regard.

Secondly, I began by talking much earlier in our debate about where I started from, and where most people in this country start from; that is, the public service interest. We have developed broadcasting from its radio days as a system that is public service based. It has been a quite remarkable—an extraordinary—story. We have a commercial system, ITV, which is public service. When we invented a second commercial channel, Channel 4, we made it public service. We are a public service system and, by and large, it works. When people are required to put their hands up to vote for it, they do so. That is what we want. This approach will not serve that. I cannot see how this procedure will make the public system stronger, how it will make it more valuable and how it will enrich it. I fail to see how

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it would add value in any way to what is central and important to our system, which is currently under threat all over the place. The system has to manage very carefully without unleashing a massive competitor that would undoubtedly and inevitably go for the throat of the audiences. I think that would result in a great diminution of the public service content of our main terrestrial channels.

5.30 p.m.

Lord Bernstein of Craigweil: I also support the amendment tabled by my noble friend Lord Puttnam. I was about to make a speech very much along the same lines as my noble friend Lord Bragg. However, first, he got in ahead of me; and, secondly, he made it much more fluently than I could. All I can say is that I support exactly what he said. ITV would suffer from a multi-media ownership competitor. One may say that that is no great problem because it is a commercial operation. That is true. But it also performs a great deal of public service broadcasting, which is bound to suffer.

As my noble friend Lord Bragg also said, Channel 4 is given the licence to be distinctive. If its advertising base is attacked, it too will have to drop distinctiveness for popularity. This is a very dangerous issue. I hope that the Government will think again before the Report stage, because it is an issue upon which many of us feel we cannot support the Government.

Lord Judd: I hesitate to intervene. I must apologise to the Committee because previous deliberations on the Bill have coincided with my responsibilities at the Council of Europe and Western European Union. But it is a Bill about which I feel very strongly indeed. I believe that the amendment comes to the centre of much public anxiety about the Bill and what is being proposed.

My noble friend Lord Puttnam, in speaking to his excellent amendment, talked about the experts who have spoken in the debate. Certainly, impressive experts with a great deal of experience have spoken in Committee. I cannot in any way claim to be an expert, but I can claim to be a person who cares about the quality of democracy. That quality of democracy depends upon the quality of information available to the electorate; the quality of commentary; and the quality of the stimulation of debate in society. The Bill deals directly and indirectly with all that.

As an ordinary layman, it seems that the danger of a concentration of power in the hands of wilful people with their own agendas is a threat to the quality of democracy. Therefore, I would say, "We cannot take this issue too seriously".

To my noble friend Lord Lipsey I would say only this: I have always had a high regard and a liking for him, because he is an utterly reasonable person. However, I think that he falls into a pit by his own reasonableness because he tempts himself to believe that he is dealing with other people who are equally reasonable and who do not in effect have ruthless agendas in which once an opening is made, that

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opening will be pursued through to a conclusion which may not at first be on the surface. But to pretend that that conclusion is not already in the minds of some of those people is—and I hope my noble friend will forgive me using the word, because I actually think it can be quite complimentary to some people in the cynical age in which we live—rather naive.

Therefore, I want to put on record, again stressing the fact that I am not an expert in any way, that I think this amendment is absolutely essential, and that unless the Government move their position very considerably, I hope it will be pursued to a vote on Report.

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