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Digital Economy Bill [HL]

My Lords, I am grateful to the noble Lords who have indicated why these amendments should not be accepted, because the Government are also hoping to persuade the noble Lord, Lord De Mauley, to withdraw the amendment. I have of course to defend Clause 22, which the noble Lord is suggesting should be withdrawn from the Bill, because it introduces an accountability and enforcement framework to ensure the fulfilment of the C4C duties introduced by Clause 21. These are based on the existing accountability and enforcement arrangements for the licensed public service channels under the Communications Act 2003. This is a very important clause as far as the Government are concerned. Amendment 233 would have repealed Section 266 of the Communications Act. Section 266 establishes a framework of annual statements of programme policy for the licensed public service broadcasters. Ofcom has powers of direction to enforce the public service remits and powers to sanction licensees for any breaches of any licence condition. However, the statements of programme policy reinforce the public service broadcasting system by focusing licensees’ attention on an overall strategy for delivering their public service remits, rather than concentrating narrowly on the quantitative targets attached to their licences. If the repeal of the statement of programme policy provisions were considered necessary, it would be preferable to do so by secondary legislation. Clause 37 of this Bill amends the Communications Act 2003 so as to permit such a provision to be reversed, also by order. I hope therefore that the noble Lord, Lord De Mauley, will see that we have made provision for that eventuality, if in due course that is the wisest position to adopt. Amendment 232C would introduce a new clause requiring C4C to report on its media content duties in its own annual report and accounts. One of the intentions of the amendment appears to be to exclude Ofcom from this exercise. Although C4C needs to provide the first line of accountability, Ofcom certainly has an important role to play, offering both guidance and oversight. That position has obtained for a number of years. Clause 22 therefore creates a requirement for C4C to prepare and publish annual accounts of media content policy, setting out how it proposes to discharge its new duties over the coming year and reviewing its previous year’s performance. It also creates corresponding duties and powers for Ofcom, which ought to be an additional reassurance. Concerns have been expressed about the creation of additional regulatory burdens, but Ofcom has indicated that the new arrangements will have minimal start-up and ongoing resource implications. C4C likewise has indicated that the new arrangements will not have material cost implications for it, so we can discount that element. The Government also believe that it would be unduly restrictive to require C4C reports on the fulfilment of its new content duties to be produced to the same timetable as the annual reports. No such requirement applies to statements of programme policy in relation to the Channel 4 service. I hope noble Lords will see that Amendment 232C is not necessary. The proposed new Section 198B of the Communications Act 2003, as I have indicated, requires C4C to prepare and publish annual statements of media content policy. Like the statements of programme policy under Section 266, the aim is to focus C4C’s attention on an overall strategy for fulfilling its duty. The requirement to publish the statement, which will include reviews of the channel’s performance against its previous statement, will help to ensure accountability and transparency. I am sure noble Lords opposite will respond positively to this. New Section 198C will require Ofcom to review and report on C4C’s discharge of its duties under Section 198A. These reviews are to coincide with the reviews that Clause 3 of the Bill introduces, under proposed new Section 264A of the Communications Act 2003, on the fulfilment of the public service objectives by other media services. New Section 198D creates a power of direction for Ofcom if it considers that C4C has failed to perform one or more of its duties under Section 198A or to prepare and publish a statement of media content policy. In some cases, increasing the obligations on the licensed Channel 4 service, may be an effective remedy for a failure by C4C to fulfil its functions under Section 198A. Clause 22(2) therefore introduces a proposed new Section 271A of the Communications Act 2003. This provides that if C4C fails to comply with a direction relating to a failure to perform one or more of its duties under Section 198A, and Ofcom is satisfied that it is reasonable and proportionate, it can vary the Channel 4 licence by making or adding such conditions as it considers appropriate to remedy C4C’s failure. Ofcom will have the power to vary the licence again if it concludes that any of the new conditions are no longer necessary. That is the significance of Clause 22, and is why we regard it as absolutely essential that it should remain in the Bill. I emphasise that these issues have been carefully thought through by the Government, as there are advantages in having a position where both C4C and Ofcom have regard in their reports to the obligation of C4C. I hope that noble Lords will therefore consider that the Government’s package of provisions is sufficient to meet any anxieties about C4C’s discharge of its duties.