BALANCING ACTS

The Government, painfully aware of its slender majority and a looming General Election, will have some skilful juggling to do when Parliament reconvenes. The Queen’s speech will unveil legislation – such as the Broadcasting Bill – which will h

When Black Rod bangs on the door of the House of Commons later this morning (Wednesday), he will not only herald the arrival of the Queen and a new Parliament but a legislative battle that will have a long-term impact on the way scores of businesses operate.

Disco owners to media owners, building society shareholders and high-street banks – all have an interest in what HRH says, or omits to say. The speech is the annual trigger for fresh lobbying campaigns as companies assimilate the impact Government can have on their business.

But this Parliament – which is likely to be the last full one before the General Election – will be made more interesting by the delicate political situation in the run-up to the poll.

Although mouthed by the Queen, the speech is written by the secretive L Committee, made up of ministers and Cabinet Office apparatchiks. They have had to perform a delicate balancing act. A Government holding a slim majority, compromised by a need to appear radical, while also wanting to keep some populist legislative tricks up its sleeve for the election manifesto could result in paralysis and a thoroughly cautious programme.

“It is a real Catch-22,” says former Government adviser Edward Bickham, now head of public affairs at Hill & Knowlton. “At this stage in a Parliament, a Government with a small majority will not risk a defeat on any legislation. At the same time, it must emphasise why it should be re-elected ahead of the other lot without giving away all its future plans.”

But there will be contentious legislation on chemical weapons and the outlawing of noisy neighbours to the Asylum Immigration Bill. For marketers, the Broadcasting Bill is potentially the most controversial legislation on the agenda. Indeed, the success of the Bill is crucial to the Government’s hopes of re-election.

Legislation permitting building societies to sell a wider variety of financial services products should also find its way into the programme, as could legislation, which would change the way companies sell pensions, although that may come later in the month with Kenneth Clarke’s Budget.

Most of the legislation which was agreed months ago – the Broadcasting Bill included – has been foreshadowed in consultative Green Papers. But even last week ministers were having heated arguments over the future of digital television and what the legislation should say.

The major sticking point is whether digital technology should be delivered via cable, satellite or terrestrial television networks. The fact that the full-blown introduction of digital broadcasting will cost 500bn and nobody appears willing to pick up the bill is another factor which is occupying ministerial minds.

In August, National Heritage secretary Virginia Bottomley unveiled plans for up to 15 terrestrial digital licences, but supporters of digital satellite delivery – not least Rupert Murdoch’s News International – are channelling their efforts into changing Bottomley’s mind.

“Digital has given them more problems than they expected,” says one insider, “the consultation has not come up with the conclusion that the Government wanted. ” So it has had to re-draw its plans.

The Broadcasting Bill will cover everything from cross-media ownership – a tricky issue so close to the election – to the digital option and Channel 4 funding. With regard to ownership, the Bill will be substantially the same as the Green Paper on cross-media ownership published in May, which set a 20 per cent per limit as the maximum stake any national TV company can hold in national newspapers and caused Murdoch to threaten to close Today newspaper.

The Government wants to switch away from an analogue system to digital not least because it will free some of the system to sell to local communications companies and generate a windfall for the Treasury. But the multitude of interests, from News International to national newspaper groups to telecommunications companies such as the Labour Party’s new friend BT, ensure that the Bill will be the focus of much lobbying.

“The composition of the committees that consider the Bill will be very interesting,” says one media lobbyist, opposed to the ownership limits, with obvious relish. “The key issue is that when the long-term proposals in the Bill are introduced there will be a different Government – not necessarily Labour – but it will be a different administration. So close to an election, nobody knows whether the Government will deliver on its proposals.”

The Building Societies Bill, which many pundits believe will also be revealed today, will not cause as many ripples, but it could fundamentally alter the pattern of takeovers and mergers that has characterised the sector this year. It will allow societies to raise more money and offer more products by loosening financial restrictions.

At the heart of the Bill is a desire to maintain an independent building society sector. Ironically, if the legislation is not introduced now it could be too late because of the scramble to take over societies which has seen Cheltenham & Gloucester, Leeds Permanent and National & Provincial all snapped up in the past 12 months.

The Building Society Association, representing the whole sector, fears that without the legislation more societies will be forced to change their status or succumb to the advances of the high-street banks.

“Without this legislation there will be a greater incentive for those societies which want to diversify to convert themselves into something that is not covered by the restrictions,” says the association’s under secretary, Sue Anderson.

“But the Bill is not a defensive move, it is a positive one to give greater flexibility.”

“We have the Government commitment and cross-party support but, clearly, we would like the legislation to be introduced sooner rather than later with the approach of the election. However it is not the end of the world if it does not happen in this session.”

The Government is also known to be ready to introduce legislation that will force pensions companies to sell more long-term private pension cover as the state system crumbles. But the move is more likely to be introduced as part of the Budget. November has become the key legislative period in the political calendar. The Queen’s speech will be followed a fortnight later by Clark’s Budget.

Parliament will also be peppered with Private Member’s Bills aiming at everything from reforming the Sunday Observance Act of 1870, allowing pubs and clubs to charge an entrance fee for dancing on a Sunday night, to the return of the threat of a ban on tobacco ads.

This session of Parliament is going to be dominated by just one thing – the timing of the General Election. Most observers see April 1997 as the most likely option, because the Conservative Party is so far behind in the opinion polls that to go any earlier would be political suicide. But with a majority of only six, events may supervene and the Queen could end up learning new lines a lot earlier than next November when Black Rod is scheduled to bang on the House of Commons door again.

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