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Digital Economy Bill [HL]

My Lords, Clause 1(2) of the Digital Economy Bill requires Ofcom in performing its principal duty to have particular regard in all cases to the need to promote appropriate levels of investment in electronic communications networks in public service media content and to have regard to the need for the investment to be efficient wherever possible. In Committee, a number of your Lordships questioned the meaning of "efficient" investment and the suitability of the phrase "appropriate levels of investment". Certain of your Lordships were also concerned that the clause, as written, failed to address what they saw as the failure of Ofcom to fulfil its duties to citizens. We have looked at whether changes to the wording of the subsection might be improved to reflect the Government’s intention and we are, as a result, proposing a package of changes to new subsection (1A) that I trust will meet the concerns raised in Committee. I want to make it clear that Ofcom’s principal consideration when making any decision must be the interests of citizens and consumers. The new duty is an aspect of that obligation. We are not introducing a power for Ofcom to impact on individual companies’ investment decisions. Instead, the provision is intended to ensure that, as many of your Lordships argued in Committee, when Ofcom is taking regulatory decisions it has in mind the need for investment in public service media content and networks fit for ever increasing demands and next-generation technologies, for the benefit of all and not just the companies involved. The amendments in this group, I hope, make this clearer by setting out more clearly what is meant by the words "efficient investment". This is, in the broadest sense, what we generally refer to as economically efficient, taking into account the benefits to investors, consumers and wider society. This definition therefore now captures investment that is efficient in commercial or social terms. Investment in public service media content, for example, would be efficient if the social benefits to citizens outweighed the cost of providing the content. A question was also raised as to whether the reference to "appropriate levels of investment" was appropriate. We have looked again at this. Consequently, we are proposing amendments to paragraphs (a) and (b), which will require Ofcom to consider whether it would be appropriate to promote investment per se, rather than require it to make a specific judgment on the level of investment that would be appropriate in a given instance. Finally, there was uncertainty about how this new subsection relates to the existing provisions in Section 3(4) of the Communications Act. To put this beyond doubt, the intention is to require Ofcom to give precedence to the need to promote investment where there is a tension between this need and the subsection (4) matters. I hope that noble Lords will agree that these amendments make the intention of the clause clearer and that they appropriately reflect the need for Ofcom to promote the interests of citizens and consumers. I therefore ask your Lordships to support these amendments. I beg to move.