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Media: Ownership

Volume 726: debated on Monday 4 April 2011


Asked By

To ask Her Majesty’s Government what conclusions they have drawn from the recent public consultation on the proposed acquisition of BSkyB by News Corporation.

The Secretary of State is currently considering all the responses to the consultation and will make a statement after the Recess. He is following a full quasi-judicial process in a fair and even-handed way. It will be his decision. I am sure the noble Lord will appreciate that at this stage I can talk about the process but not the detail.

With thanks for that Answer, can I none the less suggest to the Minister that, since there are still very widespread and serious doubts about the non-UK-taxpaying Murdoch dynasty acquiring such extra media power over an already large empire in the UK, it is right that the only outcome here should be referral to the Competition Commission for a serious independent investigation?

My Lords, the issues of competition and market power were ruled on by the EU Commission on 21 December 2010. I hear what my noble friend says, but the Secretary of State will have options at the end of the consultation: to accept the undertakings, to reject them and refer them to the Competition Commission, or to consult on a revised set of undertakings.

My Lords, is the Minister aware that, following the statement that was made on the consultation, I asked a question about how the independent directors of the new company would be appointed? In response to that question, I received a letter from the noble Baroness, Lady Rawlings, in which she said that,

“it is not important exactly how the independent directors are appointed providing that they are indeed independent”.

Is that answer not a bit disingenuous? Surely one wants to know how the independent directors are appointed to determine whether they are truly independent.

I thank the noble Lord for that. The criteria for the independent directors are listed in great detail in the articles here, which set out the connections that they must not have and the sort of people they must be. They must not, for instance, have close family ties to the Murdochs, News Corp or their advisers. The details of the criteria that those people must meet are set out extensively in the memorandum.

My Lords, does this case not show that there is an urgent need to reform the process to which the Minister referred? The decision rests with the Secretary of State but in the past few months one Secretary of State has accepted the assurances of Mr Murdoch, while his predecessor said:

“I have declared war on Mr Murdoch and I think we are going to win”.

Would it not be better for everyone concerned for decisions in these media cases to be taken by politically independent bodies, which are able to judge what is the public interest?

My Lords, a great degree of independence is built in to the decisions that are taken. My noble friend is absolutely right: it is the Secretary of State who will ultimately take the decision, but it will be based on wide-ranging consultation, and will have the agreement of Ofcom and the other bodies that regulate the media.

My Lords, I am sure that the Secretary of State will come to regret the very unconventional route by which he has approached this, which has not exposed this very complicated but important matter to a full competition inquiry. However, if the Secretary of State persists in his plan, can he at least give an assurance that the independent directors will be truly independent, the shareholders will not be under any influence from Murdoch and, indeed, that the company will remain an independent company and not see its other shares acquired by a party sympathetic to Murdoch?

My Lords, the independence of the shareholders and the fact that they will not all be members of the Murdoch family are written into the undertakings. The competition aspects were ruled on by the EU Commission, so at the moment issues of plurality rather than competition are to be discussed. However, if the Secretary of State has any misgivings, he can refer the matter to the Competition Commission.

My Lords, it is a rule of the House that for it to be in order only one person should be on their feet at one time. I am sure that noble Lords on all Benches wish to abide by that. I am aware that my noble friend Lord Fowler has recently spoken. Perhaps we should hear from the noble Baroness, Lady Bonham-Carter, before we hear from the noble Lord, Lord Grade, unless another Member of the House wishes to speak first.

My Lords, the Secretary of State said last week that the existing check on media plurality,

“may not be as robust as it should be”.

Does the Minister agree that in the upcoming communications Bill rules on media plurality and the merging of media companies should be strengthened?

My noble friend asks another key question on this. Certainly, the Secretary of State has indicated that there is a potential weakness in media plurality. The forthcoming Bill will indeed provide an occasion to consider this again.

My Lords, does the noble Baroness recognise the weight of opinion against the proposed acquisition? Not only does the latest opinion poll show that 64 per cent of the respondents think that it will give News Corporation too much power, all the media organisations are opposed to it, and virtually all media commentators are against it. Following the consultation, who actually is in favour of this acquisition?

My Lords, my right honourable friend the Secretary of State has conducted this matter in a totally transparent way and has published all the documents that he could at the time that they could be published. It has been out to consultation and more than 40,000 responses have been received, most of them through an internet campaign. My right honourable friend is considering all those responses, after which he will make a statement. He has not gone into this with a closed mind; he is open to the views that will come in.

I have watched dealings between different Governments and News International for 30 years and wonder whether the Minister agrees with me that the process we are going through is one of the most transparent and independent that there has ever been. In reaching a final settlement, what guarantees will the Government seek on the commercial viability of Sky News as an independent entity?

I thank my noble friend for that question. I do, indeed, agree with him. The guarantees of financial independence are underpinned by the carriage licensing for 10 years, which will guarantee funding and brand licensing for seven years. Those have to be approved by the Secretary of State. We have underwritings throughout this process to ensure that Sky will remain independent and financially viable.