<div dir="ltr"><b>Edward Vaizey (The Parliamentary Under-Secretary of State for Culture, Media and Sport; Wantage, Conservative)</b><br>+++<br><br>We have not yet announced a date for switchover or
even made an in-principle decision on when we might switch over to
digital radio. However, we do not want to lose the momentum towards
digital radio that has been built up by putting in place the
infrastructure, encouraging people to buy digital radios and encouraging
people to convert their cars to digital radio, which is becoming ever
easier and cheaper to do. That will help a station such as MKFM, which
is broadcasting on digital radio, as my hon. Friend pointed out. Milton
Keynes tends to be ahead of the trend and its rate of digital radio
ownership is ahead of the national average, probably beaten only by
places such as London. <p>It is important to stress
that digital radio remains an increasingly important part of the radio
mix. Another important element of the radio mix, which we could perhaps
say is at the other end of the spectrum, is <span class="">community radio</span>. The framework for <span class="">community radio</span> was set up in 2004 by the last Government. In my view, it has been an astounding success. <span class="">Community radio</span>
is run by not-for-profit organisations that provide a social gain to
the communities they serve. It provides original, distinctive
and—crucially—local output, and relies on a huge amount of effort and
support, with stations receiving an average of around 214 volunteering
hours every week. They are supported by the Community Media Association,
which does a fantastic job of representing the sector and providing
information and advice to stations and prospective start-ups. <span class="">Community radio</span>
has shown that it can deliver wider social objectives, connect
communities together, and give a real focus for local engagement. It
does not surprise me that in a community the size of Milton Keynes,
there should be a great deal of pressure to see the <span class="">community radio</span>
station MKFM launch as soon as possible. The value of the sector is not
just in its listening share or reach, but in the lives it touches and
often changes for the better.</p> <p>The recent connect:transmit project is a good example of how <span class="">community radio</span>
comes together to support skills and training for young people. It was
funded by the Paul Hamlyn Foundation and co-ordinated by Radio Regen, a
charity supporting the <span class="">community radio</span> sector. It worked with four <span class="">community radio</span> stations: Shmu FM in Aberdeen, BCB in Bradford, Future Radio in Norwich, and Preston FM.</p> <p>
I hope that my hon. Friend and the rest of the House will agree that <span class="">community radio</span> has grown and established itself as part of the <a rel="nofollow" href="http://en.wikipedia.org/wiki/UK">UK</a>’s diverse and vibrant radio ecology. As has been mentioned, a number of community radio
stations are reporting problems and struggling to remain viable, with
some stations reporting a decline in income and difficulties in
accessing funding. That is supported by Ofcom’s market analysis, which shows that <span class="">community radio</span>
stations have consistently operated on very small margins. For example,
in each of the last four years, the average expenditure of the sector
has been greater than the average income.</p> <p>Ofcom’s communications market report of 2013 showed that the percentage share of income generated by <span class="">community radio</span>
stations from grants fell from 45% in 2008 to 29% in 2012. That figure
is likely to fall still further, although it is partly offset by a
slight increase in the overall value of on-air advertising and
sponsorship revenue, which increased in 2012 from 26% to 29%. It is
important to make such points because I want to bring the attention of
the House to the consultation that we launched a couple of weeks ago on 13 February. It is a wide-ranging consultation on the funding rules that apply to <span class="">community radio</span>, because we want to consider how we can relax some of the rules and restrictions on how <span class="">community radio</span> is funded. It is a consultation that the <span class="">community radio</span> community has long called for. We think that restrictions are still needed to preserve the distinctive characteristics of <span class="">community radio</span> and ensure that small commercial radio stations are not adversely affected. The consultation will close on 23 April, and will enable us to assess the extent to which rules can be relaxed to give <span class="">community radio</span> more scope to raise funding, and to help the sector’s long-term sustainability.</p>
<p>Although there are challenges to <span class="">community radio</span>, I am encouraged by high levels of demand for <span class="">community radio</span> licences across many parts of the country. I fully understand my hon. Friend’s desire for his constituency radio station, MKFM, to establish itself as a local <span class="">community radio</span> station. The regulatory framework was set out in the <span class="">Community Radio</span> Order 2004, and lists the powers under which Ofcom can license <span class="">community radio</span> stations. That gets to the nub of what my hon. Friend wishes to discuss.</p>
<p>Detailed
implementation of licensing is the responsibility of Ofcom, and in
developing its approach to licensing and regulating the sector—including
the current licensing round, which is the subject of concern to my hon.
Friend and MKFM—Ofcom has consulted a range of stakeholders, including
the Community Media Association. Ofcom has decided to invite
applications for licences on a region-by-region basis, to co-ordinate
the approach in a fair and consistent way, and to give prospective
applicants time to develop strong and sustainable proposals. Within that
framework, the licensing process is applicant-led, and the applicant
identifies where they wish to set up their station. Ofcom does not
decide the locations or target communities to be served by stations, but
it does advise on areas where there are already existing stations, or
where sufficient frequencies may not be available.</p> <p>The
decisions are complicated and need to take account of the various
requirements in the legislation. Ofcom has to consider four things.
First, it has to assess the application and establish whether the
frequency is available. Secondly, it needs to look at the different
proposals, which may have different objectives, and there may be many
proposals for particular areas which need to be co-ordinated. Thirdly,
it needs to assess the plans to see whether the proposed service meets
the characteristics set out by the legislation
in terms of social gain and the likelihood that the plans are likely to
be viable. Finally, it needs to assess the impact on local commercial
radio and, if necessary place, restrictions on the amount of commercial
revenue that the <span class="">community radio</span> station may generate.</p> <p>The
difficulty at the moment, which affects MKFM, is the high level of
demand and competing applications. This is frustrating for stations that
are on air already and want to acquire a <span class="">community radio</span>
licence to strengthen their community engagement and grow their
listenership. They want to move more quickly. The suggestion made by my
hon. Friend is that we should adopt a demand-led process which might
lead to some applicants in some areas getting on air sooner, but it
would lead to a piecemeal approach that would slow progress overall as
decisions were made in an unco-ordinated way.</p> <p>The
way in which Ofcom manages the process overall strikes the right
balance between the operational challenges of managing the complexities
associated with licensing and its stated aim to license a <span class="">community radio</span> station for every community that wants one. In fact, since the legislation was passed, 276 <span class="">community radio</span> licences have been awarded.</p>
<p>The
current timetable was announced in April 2011 and invited applications
on a region-by-region basis, starting with Wales and the south-west,
then Northern Ireland
in March 2012 and then four English regions, one every six months.
Licences for each region are then awarded in batches on a rolling basis,
allowing the complex spectrum planning and frequency planning to be
managed together. If the number of applications received for any region
is high, consideration of all applications can take longer than
anticipated, as was</p> <p>the case in autumn 2013, so that Ofcom had little choice but to revise its timetable for inviting <span class="">community radio</span> applications in its current round.</p> <p>In
mid-October, for example, Ofcom received 38 applications from locations
in west and south Yorkshire, Humberside and the north-west of England.
That was far more than it had anticipated, and therefore in fairness to
all potential applicants from other regions, Ofcom revised its timetable
in order to give itself time to process those applications before
moving on to other regions. That is the cause of the frustration that
MKFM is experiencing. I do not want to dampen its enthusiasm and I shall
take on board some of the points that my hon. Friend made. I am not
ready to fast-track licences for people who are prepared to pay more,
because that would still involve a lack of co-ordination. At the moment,
the process is fair with a very low licence fee for anyone who wants to
run a <span class="">community radio</span> station, although I want to look at whether we can speed the process up.</p> <p>I
thank my hon. Friend for bringing this issue to my attention, and I
suggest that I discuss this with Ofcom to see if we can find a way to
move the process forward. I also wish to invite him and MKFM to a
meeting in my Department, should they wish to take advantage of that
offer. He has brought several suggestions to my attention, although I do
not think that moving Milton Keynes out of the south-east is either in
my gift or would be a practical way of taking forward MKFM’s
application. I hope to discuss that further with him when we meet.</p><p><a href="http://www.publications.parliament.uk/pa/cm201314/cmhansrd/cm140228/debtext/140228-0002.htm#140228-0002.htm_spnew117">Hansard source</a>: (Citation: HC Deb, 28 February 2014, c597)</p>
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