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Lord McNally: My Lords, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 369 [Adaptation of role of OFT in initial investigations and reports]:

Lord Wakeham moved Amendment No. 222A:

The noble Lord said: My Lords, when I raised the question of whether the arrangements under the Bill amounted to deregulation of the bureaucracy imposed on newspapers, the Minister gave me a courteous answer, and I said that I would consider his response. Since that, he has also written me a long and detailed letter, for which I am grateful. The facts are now common ground. The Newspaper Society and I agreed with the facts that the Minister set out, but we do not accept that the totality of the changes produce a deregulatory result for smaller newspapers. I shall explain why.

The Minister pointed out that, to an extent, the new regime removes the need for prior consent, criminal penalties and automatic referral to the Competition Commission. However, that is not a substantial deregulatory outcome. The new regime extends the special newspaper controls and the complex regulatory process to the smaller newspaper transactions that were not caught by the special Fair Trading Act controls. Because of the new criterion, practically any deal made by a regional or local newspaper publisher will be subject to special newspaper plurality scrutiny, not just those that would have controls triggered by a 500,000 circulation threshold. That is not deregulation; it is an extension of government control. The regional newspaper

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industry and the Newspaper Society are simply asking that weekly local newspapers be removed from the Bill's special extended public interest test, which examines plurality issues only.

Contrary to the Minister's suggestion in his courteous letter to me, it is hard to see that past cases point to a continuing need for Ministers to be able to take action against local weekly newspapers to protect freedom of expression, accurate presentation of news, and plurality of views. The Government's consultation paper stated:

    "In no case has the Competition Commission found that the acquisition of purely local newspapers would be against the public interest on freedom of expression grounds".

In only four cases since 1989 have freedom of expression concerns been raised in conjunction with competition grounds. In those cases, daily newspapers, not weekly newspapers, were the real objects of concern. In any event, the Government do not want to just keep their powers of control; they want to extend them.

The Minister's letter refers to the Joint Committee on the draft Communications Bill. Unfortunately, the letter omits the last five words. It was after hearing evidence from the Newspaper Society that the Committee stated:

    "We agree that the issue of newspaper ownership is sufficiently important".

I shall not read it all, because it is in the letter. However, the bit that the Minister missed out about deregulation outcome was,

    "especially as regards local newspapers".

Hence, the newspaper industry and I are seeking for this amendment to achieve a deregulatory outcome for local weekly newspapers that would otherwise be liable to greater intervention. This amendment would remove local weekly newspapers from the extended public interest jurisdiction. The regulatory authorities would still be able to examine other regional and local newspaper transactions on both competition and plurality grounds.

Will the Minister look again at this relatively small point about the smallest of our newspapers? If he were able to accept it now or later, it would save the Government or Ofcom money in having to investigate these tiny newspapers. It would save the newspapers a considerable amount of expense, which is not required on all perfectly reasonable competition grounds that the Government seek to insist upon. I beg to move.

8.15 p.m.

Baroness Buscombe: My Lords, I strongly support Amendment No. 222A moved by my noble friend Lord Wakeham. By excluding smaller newspapers from the definition in Clause 369 they would, as my noble friend said, be freed from what could otherwise threaten to become a considerable regulatory burden. It would be unnecessary and may add considerable

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cost to the local press to be subject to an OFT report. We welcome an amendment that would avoid this situation.

Lord Davies of Oldham: My Lords, we had a most interesting debate at a previous stage when the noble Lord, Lord Wakeham, pressed his amendments in his most articulate fashion. Of course, he has done so again today with regard to this amendment. I am obviously disappointed that my attempt to reply significantly to the issues which he raised in Committee in the form of a letter has not totally reassured him about the Government's case. He has expressed an anxiety that has been current throughout the Bill in its discussions in both this House and another place. It is alleged that the proposed regime places too heavy a burden on such titles, that the proposals extend scrutiny to the smallest of acquisitions that would have escaped scrutiny under the current special newspaper merger regime and that there have never been adverse public interest findings relating to local weekly titles alone.

I do not propose going through all those arguments again as the hour is a little late. We gave some of them a fair airing in our previous discussion. The definition of "newspaper" used in the Bill is the same as that used under the current Fair Trading Act regime. It applies to all daily and Sunday titles (whether national or local) and to local periodical newspapers, most of which are weekly. There is therefore no extension of the regime to titles not previously subject to scrutiny, although I hear what the noble Lord, Lord Wakeham was emphasising—that is, the paucity of cases in which small weekly titles have been involved in these issues.

Far from increasing burdens on the industry, in the letter which I sent to the noble Lord, to which he generously referred, I attempted to indicate that we thought that we had established some significant steps in deregulation with regard to the newspaper industry. In particular, the requirement to seek prior written consent of the Secretary of State, on pain of criminal sanctions, for all transfers of newspapers or newspaper assets where the jurisdictional criteria are met—no matter how small the title involved—will be removed. Instead, intervention by the Secretary of State will be discretionary and targeted at those cases raising genuine concerns about the effect of the merger on accurate presentation of news, free expression of opinion or plurality of views in newspapers.

The smallest acquisitions will not be subject to scrutiny on public interest grounds as they will not involve the acquisition of a newspaper enterprise with a turnover in excess of 70 million or involve a newspaper with at least a 25 per cent share of supply in at least a substantial part of the UK.

The nub of the discussion between myself and the noble Lord, Lord Wakeham, is why the regime should include local weekly newspapers at all. I trust that noble Lords do not need to be reminded of the important role played by local newspapers in the communities in which they circulate. Certainly they

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would not have to have recourse very far afield to be all too well aware of the regard in which local newspapers are held by Members of another place.

It is important that a mechanism is in place to protect the public interest of such communities in the accuracy of news reporting, the free expression of opinion and the plurality of views, where necessary. It is also important for such protection to extend to local weekly titles and not only to daily or Sunday titles, as proposed in the amendment.

Although I am not unsympathetic to the concerns expressed by the noble Lord as regards the desirability of deregulation—indeed, our proposals as set out in the Bill are designed broadly to deliver a deregulatory outcome—discretionary intervention in cases where genuine concerns have been raised represents the best balance between protecting the public interest and ensuring that regulation is not excessive. We believe strongly that such a public interest in the accurate presentation of news, free expression of opinion and plurality of views in newspapers exists in relation to national and local newspapers. The simple fact is that the vast majority of local titles are weekly. To exclude such titles from the protections offered by the proposals would amount to a grave disservice to local communities.

Given that my letter to the noble Lord did not give him the full reassurances that I had hoped to convey, I shall look at it again and, if necessary, write to him further on these matters. In the light of his remarks today, if there are matters that could be cleared up, I shall deal with them. However, I hope that I have been able sufficiently to reassure him that we are seeking to strike a balance between a broadly deregulatory measure and one that offers guarantees for the service that our local weeklies provide. On that basis, I hope that the noble Lord will feel able to withdraw his amendment.

Lord Wakeham: My Lords, I do not know whether the noble Lord is more charming when he is wrong than when he is right, but he has certainly given me a very courteous answer. However, before he writes to me again, let me write to him with a detailed commentary on his long letter so that he can see the small but quite important part for our local newspapers. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 222B and 222C not moved.]

Clause 385 [Penalties imposed by OFCOM]:

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