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Digital Economy Bill [HL]

My Lords, with the passage of the years, regrettably, any interests that I would have had to have declared are now in the past tense. None the less, in the interests of completeness, I make them now, but I hope it will be acceptable if I do not repeat them every time I intervene during the passage of the Bill. For 33 years I ran the company that was known as Scottish Radio Holdings by the time it was taken over in 2005. I was also director of Johnston Press for 11 years and retain a shareholding in that company. I have also held various representative posts in the broadcasting industry. I assure your Lordships that it is not mere opportunism that leads me to move this amendment today, although I freely concede that the fact that the noble Lord, Lord Mandelson, straddles quite so many government departments makes it rather less likely that departmental territorial imperatives will block any dispassionate evaluation of my proposal. That proposal rests on some simple, almost self-evident truths. First, convergence is happening at an almost alarming rate. Noble Lords have already alluded to that. Secondly, in those circumstances, mergers in the media sector are going to be rather more likely than less. Thirdly, since media is a very sensitive area in a democracy, it is right that any such merger must be referred to some regulatory body for clearance. Fourthly, in the interests in those in the industry, it is vital that the regulatory body concerned is both well informed as to the public interest as it affects the media sector and able to deliver its verdict in reasonable time. I contend that Ofcom meets those criteria better than the Competition Commission and that is why I propose the transfer of powers. As noble Lords have recognised, Ofcom is the specific sector regulator brought about by the 2003 Communications Act. It already has considerable powers to deal with ownership matters, which it exercises through licence agreements with the various radio and television companies. It already has quite considerable concurrent powers, as I believe they are called, with the OFT in terms of making market investigation references, investigating infringements of Chapters 1 and 2 of the Competition Act, and carrying out market studies. However, those concurrent powers do not extend to merger regulation. I concede that my amendment goes further than simply concurrent powers. It transfers the entire responsibility to Ofcom and away from the Competition Commission. It does so for two reasons. First, as I mentioned earlier, speed is of the essence. Delay in giving approval is almost as bad as a refusal of permission for a merger. For example, how long has it has taken for ITV to secure any kind of verdict on its contract rights renewal proposals, reached about three years ago? It has pretty well bled to death in the process. We cannot wait that long in future. Secondly, I do not think that a purely competition-focused regulator is best equipped to make judgments on public interest. That judgment is best made by the specific sector regulator, part of whose job it is to keep the state of the industry under constant review. It is a regrettable fact—I do not want to pass any comment on the merits of the particular judgment—that the only time there has been a public interest test, Ofcom reached one conclusion and the Competition Commission reached the opposite conclusion. Irrespective of the merits of the subject under discussion, which happened to be the Sky shareholding in ITV, I would much rather put my money on Ofcom than on the Competition Commission. I want to keep my remarks very brief, so in conclusion, if there is another way of achieving the result I seek, I will be very happy to back down and back another proposal, although it is worth noting that it was an amendment to the Enterprise Act 2002 that introduced the public interest test. So there is a good precedent for choosing the avenue I have chosen, but I am quite happy to change it. In the mean time, I beg to move.