PRP120(19)
PRESS RECOGNITION PANEL BOARD
CHIEF EXECUTIVE’S REPORT – SEPTEMBER 2019
Meeting: by email Status: for noting
Lead responsibility: Susie Uppal, Contact details: 020 3443 7072 Chief Executive
Purpose
1. The purpose of this paper is to provide an update to the Board on Executive activity since the August 2019 CEO report.
2. The Board is invited to note the contents of the Chief Executive’s report.
Executive summary
3. The Board is being updated in respect of organisational and financial matters.
Delivery updates
4. We have moved our website to a new hosting provider (Etempa) having compared the prices and services of a range of suppliers.
5. The Chair, Kathryn Cearns and I met with the ONS representative on 25 September 2019 to discuss their classification process. We met with an official from HM Treasury on 30 September 2019 to clarify the structure of the PRP and its independence from government.
6. A bank-reconciled set of management accounts as at 31 August 2019 is attached at Annex A. The deficit for the period to date is £12,139 against the year to date budget of £33,753. This represents a positive variance of £21,614 compared to the year to date forecast.
Stakeholder updates
7. The Chair wrote to Nicky Morgan MP, the recently appointed Secretary of State for Digital, Culture, Media and Sport to provide an update on our work. She responded on 20 September 2019. The letters are attached at Annexes B and C.
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8. The Chair wrote to the digital, culture, media and sports spokespeople in other political parties – Tom Watson MP (Labour), Layla Moran MP (Liberal Democrat Party), Hannah Bardell MP (Scottish National Party), and Magid Magid MEP (Green Party). The Chair also wrote to John McDonnell MP (Labour Party) along the same lines.
9. The Chair and I held meetings with Hacked Off, the Carnegie UK Trust, and the Institute of Economic Affairs to discuss our response to the Government’s Online Harms consultation.
Annual report on the recognition system
10. The call for information on the 2019 annual report on the recognition system was launched on 18 September 2019. It will close on 30 October 2019.
11. Stakeholders have been invited to share their feedback with us in writing (email or post), on the phone, or face-to-face.
Research update
12. Annex D includes an update on key external matters relevant to our work.
Implications
13. The implications of decisions taken by the Board as set out in this paper are as follows:
• Budget – There are no specific implications in addition to the issues referenced.
• Legislation – no specific implications.
• Resources – any resourcing considerations are referenced and there are no specific implications other than these.
• Equality, Diversity and Inclusion – no specific implications.
Devolved nations
14. There are no implications/differences in relation to the areas of work covered in this paper and the devolved nations.
Communications
15. There are no other issues to report which have communications implications, so far as I am aware.
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Risks
16. There are a range of risks involved in the areas of work covered in this Paper.
Recommendations
17. The Board is asked to note the contents of the Chief Executive’s report and the latest position regarding the PRP’s finances.
Attachment
Annex A - Management Accounts as at 31 August 2019 Annex B - Letter to Secretary of State for DCMS Annex C - Response from the Secretary of State for DCMS Annex D - External matters update
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Press Recognition Panel Period ended 31 August 2019
5 Months to August 2019 Full Year to DMarch 2020 Actual Budget Variance Explanation Budget £ £ £ £
Income Subscription Fees 91,967 91,967 - 220,000 Bank Interest 1,272 1,220 (52) 2,802 Total Income 93,239 93,187 (52) 222,802
Expenditure Board and Committee costs Salaries & NIC 27,546 27,395 151 67,248 Travel & Subsistence - 100 (100) 240 Other costs - - - 4,200 Total Board and Committee Costs 27,546 27,495 51 71,688
Communications Consultation Document & Translation - - - 9,600 Website & Visuals 744 7,278 (6,534) Budgeted costs for website upgrades 8,256 not yet incurred Total Communications Costs 744 7,278 (6,534) 17,856
Other costs Executive team costs 59,114 67,786 (8,672) Exec costs not yet incurred 169,432 HR & Recruitment - 4,417 (4,417) Budgeted costs for Board recruitment 6,080 not yet incurred Office costs 2,519 2,665 (146) 6,782 Meeting rooms 2,591 3,200 (609) 5,800 Travel & Subsistence 14 100 (86) 240 Information Technology 1,810 2,130 (320) 5,912 Accountancy 8,380 8,475 (95) 24,100 Audit Fees - 60 (60) 12,060 Printing & Stationery 782 1,600 (818) Annual Report printing costs came in 1,740 under budget Insurance 968 824 144 2,517 Legal - - - 30,000 Subscriptions & publications 858 850 8 2,075 Finance charges 52 60 (8) 144 Sundry expenses - - - 560 77,088 92,167 (15,079) 267,443
Total Expenditure 105,378 126,940 (21,562) 356,987
(Deficit) for the period (12,139) (33,753) 21,614 (134,185)
Reserves Bfwd 787,947 787,947 787,947 Reserves Cfwd 775,808 754,194 653,762 Press Recognition Panel Period ended 31 August 2019
Aug-19 Mar-19 £ £ £ £
Current Assets
Current account 65,220 177,858 Barclays account 759,405 758,133 Cash at bank 824,625 935,991
Prepayments 3,165 5,932 Accrued Income 258 258 Third Party Deposit 369 5,609 Sundry debtors 3,792 11,799
Creditors: amounts falling due within one year Trade creditors 3,449 732 Deferred income 38,828 130,795 Credit card 75 453 Social security and other taxes 4,600 5,097 Pensions 1,035 1,208 Sundry creditors and accruals 4,622 21,558 52,609 159,843
Net Current Assets 775,808 787,947
Funds brought forward
Funds bought forward at 31 March 787,947 860,393
Surplus/(deficit) for the period (12,139) (72,446)
775,808 787,947
Press Recognition Panel Mappin House 4 Winsley Street London W1W 8HF
Rt Hon Nicky Morgan MP Department for Digital, Culture, Media and Sport 100 Parliament Street London SW1A 2BQ
Sent by email
2 September 2019
Dear Secretary of State,
Congratulations on your recent appointment.
I am the Chair of the Press Recognition Panel (PRP), the body created by Royal Charter following the Leveson Inquiry into the culture, practices and ethics of the press, in the light of alleged criminal activity including phone hacking.
A key recommendation of the Leveson Inquiry was the creation of a ‘genuinely independent and effective system of self-regulation’. The new system was debated in Parliament and it received cross-party agreement.
The PRP is entirely independent of politicians, Parliament, news publishers, or any other such interest. The Royal Charter lists 29 criteria for regulators which, if met, ensure they are independent, properly funded and able to protect the public. Our role is to assess regulators against all 29 criteria.
The Royal Charter also requires the PRP to report on the extent to which the new system of regulation has succeeded in its aims. In February 2019, we published our latest report. Please find a copy attached. The report is informed by views from stakeholders, but the conclusions that it reaches are entirely those of the PRP Board. Our report explains that the system of regulation that was intended following the Leveson Inquiry is currently frustrated by political involvement. Section 40 of the Crime and Courts Act 2013 is on the statue books, but it has not been commenced, which means the public is not protected in the way that was intended. The legislation would provide affordable access to justice to the public when they have been harmed by the news publishers, whilst also protecting news publishers from high legal costs. It would protect the public interest, uphold the freedom of the press, and remove political involvement from regulation.
Over the last five years, the PRP has demonstrated a commitment to an independent system of self-regulation and shown that the recognition system leads to an increase in standards. In May 2018, the government stated that the PRP remains an important part of the regulatory framework.
Earlier this year, we responded to the government’s consultation on it Online Harms White Paper. Please find attached a copy of our response. It explains that social media platforms perform as news publishers when they produce, edit and distribute news. For these platforms, a regulatory framework already exists in the form of the recognition system, of which the Royal Charter and the PRP are part. Under this system, social media news publishers can join or form an independent self-regulator. That regulator can apply to be independently assessed by the PRP to confirm that it protects the public and upholds freedom of speech.
We also explain our view that the Government should not overburden news publishers and social media platforms by creating a new regulatory system, since an existing system already exists. Nor should they operate within a system different to that which applies to other news publishers (including the traditional ‘press’)
We send a copy of our response to your predecessor Jeremy Wright MP, after which he invited us to meet on 11 September 2019 to discuss matters. That meeting has been cancelled.
We would welcome the opportunity meet with you to discuss the recognition system and the issues raised in our response to the government’s consultation on its Online Harms White Paper.
I hope you will feel able to engage with us and look forward to hearing from you. Yours sincerely,
David Wolfe QC Chair of the Press Recognition Panel
Rt Hon Nicky Morgan MP Secretary of State for Digital, Culture, Media and Sport 4th Floor 100 Parliament Street Departmentfor London SW1A 2B0 Digital,Culture, E: enguiries@cullure .gov .uk Media & Sport· www .gov.uk/dcms
David Wolfe QC September 2019 Chair, Press Recognition Panel Mappin House Our Ref: 4 Winsely Street MC2019/09161 /SP London W1W 8HF
Thank you for your correspondence of 2 September regarding your report on the press recognition system.
You stated that the current system of press regulation is frustrated by political involvement. You mention that section 40 of the Crime and Courts Act 2013 has not been commenced, and should be in order to afford good protection to the public where they have been harmed by news publishers and avoid high legal costs for publishers. The government's response to the consultation on the Leveson Inquiry and its implementation outlined the reasons for which we plan to repeal Section 40.
Thank you for forwarding your response to the Online Harms White Paper consultation. Thank you also for explaining your view that social media platforms perform as news publishers when they produce, edit and distribute news.
The government will be responding to the consultation on the Online Harms White Paper in due course, in which it will set out information about the duty of care and scope of the regulations. The white paper's proposals do not impact journalistic and editorial content, and the regulator will not be responsible for policing truth and accuracy online. Where services are already well regulated, this will not be duplicated.
I look forward to meeting with you to discuss these issues in due course . ~~ ~~~
Rt Hon Nicky Morgan MP Secretary of State for Digital, Culture, Media and Sport Annex D to PRP120(19)
Update on key external matters
1. The update on key external matters is a research-informed piece based on a sample of information available in the public domain.
Commercial Landscape
2. The Sun is the most read UK national newsbrand across print and online with the Mirror moving into second place for the first time, according to the latest Pamco figures. Although the Mail has dropped from the top of the UK audience list in the last quarter’s figures, Mail Online’s global traffic was up year-on-year in August due to growth in the US – while the publisher said it valued engagement metrics more.
3. According to the latest ABC figures, the Guardian recorded the smallest year-on- year circulation decline among UK national newspapers in August for the second month in a row. However, all UK national newsbrands are continuing to see print circulations fall. The Guardian recorded a year-on-year circulation drop of 5 per cent to an average of 128,265 copies in August. The biggest year-on-year decline was reported by the Daily Star Sunday at 19 per cent, followed by the Sunday People at 18 per cent. The Sun remains the best-selling national newspaper with an average circulation of 1.3m in August, despite a 12 per cent drop. The Daily Mail is close behind on 1.2m and has set new retail market share records for its weekday, Saturday and Sunday editions.
4. The Telegraph signed up more than 15,300 paying subscribers in August, the equivalent of nearly 500 each day on average. Press Gazette reported that the figure is by some way the highest achieved by the newsbrand since it started charging for access to content. It set up a metered paywall in 2013 but moved to a “premium content” model in 2016, putting select articles out of reach to non- subscribers.
5. Press Gazette reported that pre-tax profits at the Financial Times Ltd grew by three-quarters in 2018 as digital subscription revenues continued to rise. The company made £8.15m in profit before tax last year, up 68 per cent from £4.65m in 2017, according to full-year accounts filed with Companies House. Revenues increased by more than £2m to £323.6m while operating profits grew from £4m to £7.3m.
6. Press Gazette reported that the parent company of news agency PA Media boosted profits by 8 per cent in 2018. PA Media Group has reported pre-tax profits of £3.3m in new full-year figures for 2018, up from £3.1m the year before. The company said it was “another strong year of underlying profit and revenue growth… again driven by our data business units, with strong performances also recorded by recent acquisitions”.
7. As reported by Press Gazette, the editors of the Times and Sunday Times have proposed sharing resources across the travel, money, property and sport sections of the two newspapers, as well as in sports production. This follows news in July that the Government would allow owner News UK to make changes to editorial independence rules which were established when Rupert Murdoch bought both titles in 1981.
8. Ex-News of the World editor David Montgomery has outlined his plans to “transform the sector” by foregoing “archaic industrial practices” and buying up struggling titles for his new publishing company. Local World founder Montgomery is the executive chairman of National World. He is expected to bid for titles such as the i or the Scotsman from JPI Media, which is in talks with other publishers to sell assets. In a document published yesterday, ahead of the company’s shares going live on the London Stock Exchange, National World said it “aims to transform the sector through acquisition and partnership”.
9. The Financial Times made its online journalism available free for 24 hours globally to promote a new brand campaign for a “better form of capitalism”. The title provided access to content that would normally sit behind a paywall. Readers still had to pay for the print edition in the UK, but up to 7,000 copies were handed out for free in New York City with the purchase of select US newspapers.
10. Press Gazette reported that Reach, the UK’s largest regional publisher, has begun its first paywall experiment on a regional newspaper, saying giving away the title’s content for free online has become “difficult to sustain”. Reach has begun trialling a micro-paywall on Examiner Live, the website of the Huddersfield Daily Examiner. The website is using payments platform Axate which allows readers to put money into a digital “wallet” and pay a small fee per article.
11. Money Management magazine, part of the Financial Times group, has folded. Press Gazette reported that the monthly title has been described as the “bible” of financial services. It first published in 1962 as the Unitholder before changing its name in 1970.
12. As reported by Press Gazette, magazine publisher TI Media is closing the print edition of Marie Claire in the UK. TI Media said it is pursuing a “digital-first future” for the brand, which will see the 31-year-old magazine close in print with its November issue. Nine days later, it was reported that Marie Claire UK’s editor-in- chief, Trish Haplin, and managing director, Justine Southall, had announced plans to step down from the publisher.
13. The Voice, the UK’s only newspaper aimed at the black community, is going monthly after 37 years as a weekly title. The London-based title announced the changes on its front page, telling readers it was embarking on an “exciting new direction”. The new 72-page monthly paper will launch on 26 September.
14. Plans to help tackle "fake news" have been announced by the BBC and some of the biggest names in journalism and technology. The new measures include an early warning system for use during elections or when lives may be at risk, extra online education and improved access to impartial resources for voters. Major publishers, Google, Twitter and Facebook have helped devise the scheme. The BBC said the moves were “crucial steps” in fighting disinformation.
15. As reported by Financial Times, Google is investing “several million dollars” into a joint venture with Archant, the Norwich-based publisher behind the Eastern Daily Press and several local titles in London. The venture, called Project Neon, is Google’s first such project outside the US. It will be fully funded by Google but controlled by Archant. It will set up digital news sites in three British regions that will experiment with “different commercial approaches” such as building direct relationships with local businesses with the aim of attracting both advertising and philanthropy. The project will run over three years, after which Archant hopes the new news outlets will be self-sustaining.
16. Press Gazette reported that DMG Media has urged “prompt and decisive action” over Facebook and Google’s dominance of the digital advertising market. It warned the news industry will “not be able to survive much longer” if action is not taken. The warning came in the publisher’s response to the Competition and Markets Authority’s investigation into whether competition in the digital advertising market is “distorted” by the digital duopoly.
17. As reported by the Financial Times, Google has adjusted its search algorithms to promote news articles it considers “significant original reporting”. Google said that stories that provided “original and in-depth” information and had required “a high degree of skill, time and effort” would be elevated in results and “may stay in a highly visible position longer”.
18. Welsh rugby player Gareth Thomas has told BBC Radio 5 Live that a journalist revealed his HIV positive status to his parents before he had told them himself. He said he was forced to go public about his condition as a result of tabloid interest and would otherwise have stayed silent. He chose to reveal his HIV diagnosis in the Sunday Mirror and has also filmed a BBC documentary. Thomas declined to identify the newspaper that had sent the journalist to speak to his parents when invited to do so on air, but said cryptically: “…everybody will know, especially of late”.
Legal
19. In his memoir For the Record, David Cameron has admitted he was wrong to insist his Downing Street communications adviser Andy Coulson was innocent until proven guilty over phone hacking at the News of the World, suggesting he should have removed him in 2010 before the scandal snowballed and “brought the coalition close to collapse”. He admits that he considered the former editor of the Sunday tabloid “a good guy, a nice guy” but he allowed his judgment about employing him at the heart of his No 10 operation to be swayed by wanting to believe Coulson’s repeated assurances that he knew nothing about hacking.
Political
20. Natalie Bodek, the acting deputy director of the elections division in the Cabinet Office, and Sarah Connolly, director of security and online harms at DCMS, gave evidence to the House of Lords Committee on Democracy and Digital Technologies on work being carried out to monitor interference, disinformation and threats during elections. They told peers that a cross-government Defending Democracy Programme is underway, collaborating across departments and agencies, as well as with social media platforms, to protect and secure UK democratic processes, systems and institutions from interference and to promote fact-based and open discourse, including online. They also revealed that the programme has been operating “election cells” to monitor and provide an “escalation point” to government for any potential issues.
21. The Foreign Affairs Select Committee said in a report published this month that the Foreign Office’s media freedom campaign and other recently launched initiatives amounted to a “good start” towards defending media freedom worldwide, but that the UK ought to “go further”. Committee chairman Tom Tugendhat described the Foreign Office’s campaign as “well-intentioned” but “short on resources, short on detail and short on sustained commitment”. In the report, MPs shared concerns the Foreign Office has “allocated too few resources, given too little detail about how it will fulfil its campaign, and taken too passing an interest in how to make it sustainable”.
22. As reported by Press Gazette, the Government will not appeal a ruling which has stopped it from ordering a full investigation into Saudi investments in the Evening Standard and Independent newsbrands. The Competition Appeals Tribunal ruled last month that the Government had missed the deadline to force an investigation. In advice to the Secretary of State, Ofcom highlighted the importance of newspapers to democracy and said that the transaction should be considered in the context of the challenges faced by newspapers. Owner Evgeny Lebedev said the Ofcom report had “completely vindicated” their editorial integrity. In a tweet, he lashed out over what he described as the Government’s “poor judgement and errors” and decried it as a “waste of public money, and ours”.
23. The Guardian reported that the Conservative party has been funding ads on Facebook that present a BBC News article as endorsing the government’s inflated figure for school spending – when the article actually criticised the figure’s credibility. Since the beginning of September, the Conservative party has paid for ads on Facebook that link to a BBC article on school funding, with the headline “£14 billion-pound cash boost for schools” appearing between a photo with the BBC News logo and its web address BBC.co.uk/News. Sean Coughlan, the BBC’s education editor, said the BBC article only used the government’s £14bn figure in order to dismiss it.
Regulatory news
24. The Conversation, which edits and publishes articles written by academics, has joined IMPRESS. The non-profit news outfit publishes its content online for free and allows news publications to republish it without charge. The Conversation launched in the UK six years ago and is edited by former Guardian news editor Stephen Khan.
25. IPSO has announced that all bar two publishers in membership have chosen to remain part of the IPSO system for the next five years. The announcement came on the fifth anniversary of the regulator’s establishment. Out of the 83 publishers signed up, Citywire and Connect have both indicated they will leave after the first term.
26. IPSO has announced it has agreed changes to its rules and regulations with its regulated publishers. These include an expectation that member publishers carry the IPSO mark in print and online to denote their membership. The changes also include a new provision in the regulations for handling complaints about global digital publishers, defining what a global digital publisher is, and setting out what foreign, online content is outside of IPSO’s jurisdiction. IPSO has also announced it has agreed a new funding arrangement with the Regulatory Funding Company, ensuring its financial independence up to 2025.
27. Policy Exchange, a centre-right think tank, have published a report called Eroding the Free Press which examines IPSO’s guidance on how to report on issues connected with Islam and Muslims. Policy Exchange director, Will Heaven, wrote in the Telegraph that the scope of the guidance “goes far beyond normal journalistic practice” and that he is troubled that it is being drafted by “a secret committee”. He reveals one of the people on the committee is Miqdaad Versi, “a campaigner against what he calls ‘Islamophobia’ in the UK’s media”, and questions whether it is right that a religious campaigner should be invited by IPSO to draft journalistic guidance. IPSO chief executive, Matt Tee, responded by saying: “[IPSO guidance] focuses on key questions that journalists could ask themselves when writing about Islam. Journalists at The Telegraph may not feel the need for such guidance, but the majority of publications regulated by IPSO are local papers, often produced with a small, less experienced staff who may value such assistance … We are taking views from a variety of sources, which, of course, include people from Muslim organisations, but also include newspaper editors and journalists. The proposed guidance is drafted by IPSO staff and only IPSO staff.”
28. IPSO chief executive, Matt Tee, issued a statement relating to recent newspaper coverage of Ben Stokes and Gareth Thomas: “Whilst we are not able to comment on individual cases, we take all complaints made under the Editors’ Code seriously, and if a complaint raised a possible breach of that Code, would investigate rigorously and sanction appropriately if required. Rightly, in cases relating to privacy, the individual or individuals directly affected should decide what the most suitable course of action for them is. IPSO supports a free and thriving press which is held accountable to a set of standards agreed by the industry and underpinned by effective self-regulation.”
29. Press Gazette reported that content primarily aimed at overseas readers published by UK-based news websites with newsrooms in other countries, such as Mail Online, is now formally exempt from complying with IPSO guidelines. Previous rules meant the Independent Press Standards Organisation could decide whether or not it should investigate online stories from members classed as “global digital publishers” on a case-by-case basis, but new rules removing this discretion have been voted on and approved by IPSO’s 81 publisher members – the vast majority of major UK national titles.
Campaigners’ news
30. The Society of Editors has welcomed the decision by the courts to refuse to order journalists to hand over their notes to counter-terrorism investigators. The Met Police had sought an order for material from the Times, Sky News, ITN and the BBC from their conversations with 19-year-old “Isis bride” Shamima Begum after she was discovered in Syria earlier this year. But an Old Bailey judge has ruled that the news providers cannot be compelled to hand over their unpublished notes to the police.
31. Hacked Off has responded to the news that the BBC has agreed to pay out £2m in legal costs to Sir Cliff Richard, after the broadcaster was found to have unlawfully invaded his privacy by filming a police raid on his home and reporting that he was being investigated over historical child sexual abuse claims. He was never arrested or charged. Hacked Off said: “Any decision to publicly name an individual under police suspicion before they are charged should be taken in an accountable manner where the public interest is balanced against the privacy interests of the individual … It should not be, as it appears to have been in this case, that Sir Cliff’s name was revealed as a result of a secret deal stitched up between a reporter and the police … The media should scrutinise justice, not administer it.”
32. Hacked Off has responded to the news that most IPSO publishers have renewed their membership for five years – following the news last month that Lord Faulks will be taking over as Chair – by saying: “The fact that newspaper publishers have signed up for another five years – in the knowledge that their coverage will be regulated by a politician from January – should be concerning to anyone who believes in freedom of the press.” They say the announcement “marks five years of failure for IPSO” and that “independent press regulation has never been more critical”.
33. Hacked Off has responded to the Policy Exchange report, Eroding the Free Press, by saying: “To be clear: these are unenforceable guidelines, published by a toothless complaints-handler, which continues to be at the mercy of a committee of newspaper executives who heavily influence its rules and a committee of editors who write the standards code. The guidelines are redundant in every sense of the word. This hasn’t stopped Policy Exchange from churning out a 28-page report warning of the end of press freedom … this is a ludicrous and transparent attempt at misdirection. Suggesting that IPSO is ‘too strict’ deliberately conceals the reality that IPSO is an entirely ineffective body, subject to industry control and influence at every turn, and unable to regulate competently.”
34. Hacked Off accused the Sun of committed “another appalling invasion of privacy” after its front-page story about a historical family tragedy relating to England cricketer Ben Stokes which it said was “despicably delving into his family’s past with blatantly no public interest”. It went on to say: “The fundamental problem is the total absence of regulation across most of our newspaper industry. The self- regulator IPSO has the power to issue large fines and launch serious investigations into breaches of the Editors’ Code, but it has never done so. This is because IPSO is run by the same newspapers it is supposed to regulate. There is no deterrent from newspapers acting in this way time and again.” It later reported that the journalist who wrote the story, “alleged phone-hacker” Nick Parker, “is a convicted criminal who the Sun welcomed back to the newspaper”
35. Hacked Off has responded to reports that an unnamed tabloid newspaper had forced Gareth Thomas to reveal his HIV status by calling it “victimisation not journalism”. It said in a tweet that it had showed “no human decency whatsoever” and added: “What can we expect from the so-called regulator IPSO? Nothing. Nothing has changed since Leveson 7 years ago and it never will unless we have a genuine, independent regulator.”