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Digital Economy Bill [HL]

My Lords, it is a pleasure to see that the Government have listened to some of the concerns that the House raised during the drafting of Clause 1. There are still issues with the clause, but I will save those worries for my amendments. For now, I shall turn my attention to the amendments proposed by Her Majesty’s Government. I am grateful for the explanation provided in correspondence by the Minister regarding the Government’s thinking on these amendments. As he said, they have had to go back to the drawing board on the specific issue of efficient investment. I was slightly worried that by addressing one concern, the Government may have raised others, but I hope that this debate can lay those to rest. This clause now states that Ofcom will promote investment in "electronic communications networks" and "public service media content", where appropriate. That is an important distinction. However, it throws up a number of important questions about the meaning of the word "appropriate", which were not dealt with in Committee. For instance, who decides when an investment is appropriate? By what criteria will such an investment be judged? Will investment be considered appropriate if it leads to faster broadband speeds, greater profits for a company or greater competition in the market? Depending on what criteria are used to define "appropriate", the outcome could be markedly different. The Minister wrote to the noble Lord, Lord Mitchell, regarding these amendments, stating that, ""unlimited investment in all features of an electronic communications network will not always be appropriate"." I agree. There are always other considerations that will need to be taken into account in determining whether the investment is justifiable on public policy grounds. The Minister referred to those of those a few moments ago. Some clarity on the Government’s definition of appropriateness would be helpful, not least for the regulator who will need to balance these new duties with existing ones. The addition of the phrase, ""taking account of the interests of citizens and the interests of consumers in relevant markets"," presumably ensures that the interests of consumers will be considered when determining the appropriateness of an investment. But what other factors should be considered? Perhaps I am in danger of reading too much into this, but I cannot help thinking that "where appropriate" could just be a generic phrase that gives the regulator enormous leeway in making its decisions. There is a danger that such leeway could create uncertainty for the industry, as businesses will find it difficult to know how the duty will be interpreted. All organisations need certainty and a clear and level regulatory playing field. The telecommunications sector is no different, and given the amount of investment required to upgrade the country’s communications networks and the length of time required for a return on such an investment, anything that muddies the waters or causes doubt should give pause for thought. Is the Minister confident that the addition of "where appropriate" will not lead to uncertainty—uncertainty that threatens the investment this duty is designed to promote? Finally, can he reassure those of us who remain unconvinced that this clause is needed at all that these amendments significantly enhance those duties that Ofcom already has?