Media regulation in the UK - a response to David Elstein

How newspaper companies can be encouraged to remain inside a new regulatory system was a fundamental question for Lord Justice Leveson's inquiry. Much of the debate since has focused on striking the right balance between carrots and sticks.

David Elstein, in his comments on both my report for the IPPR, Life after Leveson, and the work of the Hacked Off campaign, appears to rule out two potentially effective approaches to this problem and substitutes one that is no longer regarded as a serious runner. 

For my part, I remain sceptical about both the effectiveness and practicality of the various ‘incentives to participate’ currently on offer. That includes those suggested by Hacked Off campaigners, such as the imposition of exemplary damages on non-participating publications in libel cases. Given the contortions the politicians are currently going through on this, it may yet prove unworkable.

My proposal was simpler, make participation in the new regulatory system mandatory on all news publishing organisations above a certain size. In the end, what matters, it seems to me, is not how you ensure organisations participate in the system, but that the system itself is fair, transparent and works successfully both for the industry and for consumers and citizens.

David Elstein rules out this option and doesn't appear to like the incentives proposed by Hugh Tomlinson QC either. He favours instead the economic inducement of removing the current VAT waiver from news publications that opt to stay outside the regulatory system.

Unfortunately he doesn't appear to have read the opinion submitted to the Leveson inquiry by the Deputy Director in the Solicitors Office at the HMRC, John Evans. The HMRC opinion concludes that "the fundamental principle” “of the fiscal neutrality is likely to be breached if VAT at the standard rate were applied to supplies of some newspapers and not others". One potential downside of this, John Evans notes, is that zero rating might be lost in supplies of all newspapers - something I'm sure would be universally opposed by the publications David Elstein seeks to protect from more "Draconian" measures.

In my report for the IPPR I attempt to look beyond press regulation, which I believe can no longer be treated in splendid isolation. The migration of newspaper readerships online is a trend that will continue. Yet David Elstein’s argument seems to be based in a world where digital news publishing does not exist.

We need to recognise that print, online and broadcast media are increasingly operating in a converged space. A regulatory system which continues to treat them as if they lived in discrete little boxes will become increasingly ineffective and loose public support.

I do not believe that the distinction between broadcast journalism and newspaper journalism (not to mention online journalism) is as marked as David Elstein appears to believe. It is often said that broadcasters could not have exposed the scandal of MPs’ expenses in the way that the Daily Telegraph did. That may be the case, but as long as a public interest defence can be satisfied, both the Broadcasting Code and the BBC Editorial Code certainly allow for investigative journalists to take steps which might otherwise be regarded as outside the law. The ITV Exposure programme on Jimmy Savile or the Dispatches programme which exposed senior former ministers offering themselves as ‘taxis for hire’ are both examples that demonstrate how effective television can be as a medium for investigation and exposing wrongdoing.

A more fundamental distinction within news is between those services that are required to be balanced (i.e. broadcast services) and those in which news reporting is accompanied by partial comment and opinion. This is an important distinction my proposals seek to preserve. 

My proposal is that the regulation of different types of content – advertising, news publishing, broadcast news, on demand content – be managed in future on a day-to-day basis by distinct independent bodies, operating at arm's-length from current media regulator, Ofcom.

I chose Ofcom for this role because I don’t believe in reinventing the wheel, and I don’t accept the argument that we shouldn’t make Ofcom the backstop power for the press simply because “it doesn’t want the job”. That is not a sound basis for decision-making. I doubt that Ofcom was terribly keen to take on regulation of postal services. But there you are; the decision was made and Ofcom seem to be getting on fine with the job today.

My report is an attempt to provide some coherence to the current fragmented system for media regulation. It was also an attempt to ensure that industry as well as consumer voices are represented within independent regulatory bodies, so that the best of self-regulation can be preserved, albeit with recourse to Ofcom’s authority and statutory back-up, if necessary.

David Elstein accuses me of lacking "detailed knowledge" in making these proposals. As one example he says that “there is no need to subject the Advertising Standards Authority...to backstop authority from Ofcom”. This is surprising since, on current arrangements, the Advertising Standards Authority has not one but two backstop authorities: Ofcom and the OFT. The point of my argument is that the blurring of the space between print, broadcast and online advertising suggests that eventually it might be better for these roles to sit in one place.

His criticisms about the workings of the Authority for Television On Demand (ATVOD) – another current arms-length body – may be valid, and I argue for reform of ATVOD too. On- demand television content is becoming increasingly indistinct from linear television content and I see a more seamless approach to regulatory standards as becoming a necessary protection for parents and children.

In the world of news publishing (in print and online), video rich, on-demand news content is a potential growth area where newspaper companies should be allowed to develop their services further without risking (as they do now) a jump from one regulator to another. It makes sense to put regulatory responsibilities in this area under the wing of whatever emerges as a post-Leveson regulatory body. It might even help the newspaper companies who, I would argue, face a bigger threat economically than they do from the development of the new regulatory system.

Alongside standards in media, plurality of media (particularly new media) is a critical part of an open democracy. We need a new approach to this issue. David Elstein seems to believe that the current system, where the Secretary of State performs a “quasi judicial” role in plurality assessments means that "the government, as such, has no role to play”. This seems a little credulous. The idea that an individual Secretary of State could perform a quasi-judicial role on a matter of such national significance as media plurality without other parts of government, including Number 10 Downing Street, having a view is unrealistic.

For the future, Ofcom has suggested a very sensible approach involving periodic plurality assessments which requires much further thought and examination given that it was an area where Lord Justice Leveson did not have the time nor the capacity to delve too deeply.

Amidst all that is changing in the media, I do believe that public service broadcasting (PSB) should remain at the heart of the UK content investment and distribution. I don’t see this as “odd”. It would seem that Parliament and government agree, having recently awarded ITV and Channel 5 a further 10 years each to operate their PSB licences.

I believe the same should be afforded to the BBC. The most recent exercise in setting the licence fee (2010) over a weekend of frantic phone calls between ministers and the BBC management was frankly an insult to the licence fee paying public. There is an important debate to be had both about the future level of the licence fee and the scale and scope of BBC services to be delivered in return. This must be made much more open and transparent next time round.   

Media consumption in the UK is changing and delivery technologies are changing. Our regulatory system will continue to fall woefully behind if the kind of piecemeal approach David Elstein appears to favour prevails.

He may regard the approach I outline as "dangerous", but I think there is a bigger danger: that the economic pressures now being brought to bear on traditional media in the UK put at risk the very forthright and vibrant mix of media - new and old, impartial and opinionated - that people in this country currently enjoy.