Examination of Witness (Questions 77-79)|
MONDAY 27 MAY 2002
Chairman: Welcome, ladies and gentlemen. As
you can see we are a hotter ticket than Madonna! Thank you very
much, Mr Edmonds, for coming here. Can we kick off with some questions
from Lord McNally.
77. I think the Committee is getting a little
bit worried already that OFCOM is going to be unbalanced in its
work, not because those who are running OFCOM are going to get
it unbalanced but the tug will be towards the television/radio
content side of its work which might leave the more technical
side unexposed and underworked. Do you see this as a real danger?
We have had already strong advocacy of the idea of a content board.
Do you think it may be necessary for there to be a transmission
or an economic board that reminds OFCOM that it has got these
very, very important technical duties as well?
(Mr Edmonds) I very much hope not. I
would probably quarrel with your use of the word "technical".
I think at the core of OFCOM is the economic regulation that this
draft Bill sets out, the transposition into UK law of the European
Directives. Alongside that core is the work that the Radiocommunications
Agency currently does, the allocation of spectrum. My concept
for the body is of an economic competition regulator with a bank
of powers which are established very firmly by this legislation.
The first section of the Bill is to do with the way economic regulation,
competition regulation is going to be carried out in the UK. It
is law which is transposed from a set of European Directives which
means that the organisation cannot shirk its responsibilities,
it cannot but carry out that range of activities, that range of
duties. I have every confidence that with an organisation effectively
designed with a structure which enables it to carry out those
responsibilities they can get the balance right.
78. You think the Bill effectively designs the
(Mr Edmonds) No, I do not think it does. I think the
Bill effectively sets out a range of duties, a range of activities,
not options but a range of activities which must be carried out.
As an economic regulator I cannot but regulate when somebody comes
to me with a complaint. I cannot say "I am not going to deal
with this". If I see a failure in the market place I am bound
to investigate that failure and if I discover there is market
failure I am bound to drive through action to redress it. That
is central and absolutely integral to OFCOM. My hope is that the
consultants who are working currently to advise the new board
on possible frameworks will actually design an organisation that
is carefully designed to carry out those functions. No, I do not
think the Bill designs it, I think the Bill sets out what has
got to be done by the organisation. I think it is up to the people
who will be running it, the people who are advising them, to create
an organisation where the form follows its functions. I am very
optimistic that can be done.
79. When will this effective design be in place
(Mr Edmonds) Towers Perrin, who are the consultants
appointed by the two departments and the five existing regulators,
are working currently on a series of options designed to be ready
to present to the Chair and the putative board by July/August
of this year. One's hope is that as that work rolls out, the Chair
of the new board is in place, the staff start to be appointed,
there will be an organisational design which does follow very
coherently the functions of the organisation. I think it is classic
architectural design: form should follow function. I think there
is every chancebecause we are starting with a blank piece
of paperthat OFCOM can be designed so that the imbalance
that you are anxious about does not happen.