PRP24(20)
PRESS RECOGNITION PANEL BOARD
CHIEF EXECUTIVE’S REPORT – JULY 2020
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 June 2020 CE 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, financial and banking matters.
Delivery updates
Finance update
4. A bank-reconciled set of management accounts as at 30 June 2020 is attached at Annex A. The deficit for the period to date is £10,522 against the year to date forecast of £22,217. This represents a positive variance of £11,695 compared to the year to date forecast. The bulk of this variance (£10,175) relates to budgeted HR and recruitment costs which are still anticipated later in the year.
Delivery update
5. The annual report and financial statements for the year ended 31 March 2020 were laid in Parliament and the Scottish Parliament on 21 July 2020 with copies provided for information to the Northern Ireland Assembly and the National Assembly for Wales. I wrote to the NAO to express appreciation for the smooth and efficient conclusion of the audit.
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Board recruitment update
6. The Assessment Panel held an online meeting with Green Park to review the shortlist of candidates and agreed the final group for interview. The interviews will be held on 16 and 17 September 2020.
Stakeholder engagement update
7. Redacted.
8. The Chair wrote to the Minister of State for Media and Data, John Whittingdale MP in response to question he provided on 16 June 2020 to parliamentary questions asked by Bill Wiggin MP. The letter is attached at Annex C.
9. Redacted.
10. The Chair had a virtual meeting with Daisy Cooper MP on 13 July 2020. They discussed the Recognition system and the benefits of s40 to the press and the public.
Research update
11. Annex E includes an update on key external matters relevant to our work.
Implications
12. 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
13. There are no implications/differences in relation to the areas of work covered in this paper and the devolved nations.
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Communications
14. There are no other issues to report which have communications implications, so far as I am aware.
Risks
15. There are a range of risks involved in the areas of work covered in this Paper.
16. A robust and defensible position in relation to the PRP’s finances is required in order to avoid reputational damage and to ensure compliance with HM Treasury’s Managing Public Money.
Recommendations
17. The Board is asked to note the contents of the Chief Executive’s report.
Attachments
Annex A - Management accounts as at 30 June 2020 Annex B - redacted Annex C - Letter to the Minister of State for Media and Data, John Whittingdale MP Annex D - redacted Annex E - External matters update
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Press Recognition Panel Period ended 30 June 2020
3 Months to June 2020 Full year to March D2021
Actual Budget Variance Explanation Budget £ £ £ £
Income Subscription Fees 54,849 54,849 - 220,000 Bank Interest 538 720 182 2,880 Total Income 55,387 55,569 182 222,880
Expenditure Board and Committee costs Salaries & NIC 16,282 17,181 (899) 69,224 Travel & Subsistence - 60 (60) 240 Other costs --- 3,600 Total Board and Committee Costs 16,282 17,241 (959) 73,064
Communications Publications --- 9,600 Website and Upgrades 127 129 (2) 523 Total Communications Costs 127 129 (2) 10,123
Other costs Executive team costs 40,189 39,071 1,118 Variance expected to even out later in 151,501 the year HR & Recruitment - 10,175 (10,175) Costs not yet invoiced for recruitment. 18,988 Related advertising and candidate expenses not yet incurred
Office costs 1,458 1,644 (186) 6,641 Meeting rooms - 1,100 (1,100) Meeting room costs not incurred 5,700 during lockdown period Travel & Subsistence - 60 (60) 240 Information Technology 1,273 1,052 221 5,207 Accountancy 5,170 5,230 (60) 24,692 Audit Fees --- 12,000 Printing & Stationery 252 910 (658) Design costs for annual report not yet 1,090 incurred Insurance 631 628 3 3,060 Legal --- 30,000 Subscriptions & publications 509 510 (1) 2,094 Finance charges 18 36 (18) 144 Sundry expenses - - - 576 49,500 60,416 (10,916) 261,933
Total Expenditure 65,909 77,786 (11,877) 345,120
(Deficit) for the period (10,522) (22,217) 11,695 (122,240)
Reserves Bfwd 717,484 717,484 717,484 Reserves Cfwd 706,962 695,267 595,244 Press Recognition Panel Period ended 30 June 2020
Jun-20 Mar-20 £ £ £ £
Fixed assets 1,434 -
Current Assets
Current account 92,552 159,222 Barclays account 711,295 710,763 Cash at bank 803,847 869,985
Prepayments 4,050 5,682 Accrued Income 181 175 Third Party Deposit 369 369 Sundry debtors 4,600 6,226
Creditors: amounts falling due within one year Trade creditors 4,204 453 Deferred income 75,947 130,795 Social security and other taxes 4,466 4,809 Pensions 1,035 1,035 Sundry creditors and accruals 17,267 21,635 102,919 158,727
Net Current Assets 705,528 717,484
Net Assets 706,962 717,484
Funds brought forward
Funds bought forward at 31 March 717,484 787,947
Surplus/(deficit) for the period (10,522) (70,463)
706,962 717,484
Press Recognition Panel Mappin House 4 Winsley Street London W1W 8HF
Rt Hon John Whittingdale OBE MP Minister of State for Media and Data 4th Floor 100 Parliament Street London SW1A 2BQ
Sent by email
Dear Mr Whittingdale,
I am writing in response to answers you provided on 16 June 2020 to parliamentary questions asked by Bill Wiggin MP.
One answer stated:
IPSO is independent of government. In 2016 it commissioned its own external review which found it had made some important achievements in demonstrating it was an independent and effective regulator.
Another answer stated:
There now exists a strengthened, independent, self-regulatory system for the press. The majority of traditional publishers—including 95% of national newspapers by circulation—are members of IPSO. A small number of publishers have joined IMPRESS.
IPSO is not independent of government. IPSO has recently appointed a member of the House of Lords as its Chair. Lord Faulks has recent affiliations with the Conservative Party and served as Minister of State for Justice between December 2013 and July 2016. The Press Recognition Panel (PRP) could not and would not make such an appointment to its own Board, and a truly independent regulatory body as contemplated by Lord Leveson should not allow it either.
The PRP is the only independent body established to assess press regulators against the Royal Charter criteria. IPSO has not been independently assessed by the PRP against the Royal Charter criteria.
We recognise that IPSO has moved closer towards meeting some parts of the Royal Charter criteria. However, IPSO is not independent from the news publishing industry and it is not possible to discern a full and clear picture of the complaints it receives. IPSO is not independent and effective. IPSO does not provide the public with the basic levels of protection intended following the Leveson Inquiry. Your focus on ‘traditional publishers’ and ‘national newspapers’ ignores that those publishers are a diminishing source of news. According to the recently published Reuters Digital News report, in April 2020, 79% of people access news online (including social media) compared to 18% who consumed a print publication. Most people access news via online news sites and social media platforms such as Facebook, Twitter and Google, which are also ‘relevant publishers’ within the Crime and Courts Act, and which are neither members IPSO nor IMPRESS.
Do let me know if it would useful to meet and discuss further.
Yours sincerely,
David Wolfe QC Chair of the Press Recognition Panel cc Bill Wiggin MP
Annex E to PRP24(20)
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. Press Gazette reported that the Daily Star saw the biggest recovery from the worst of the Covid-19 lockdown readership slump in June, according to the latest UK national newspaper circulation figures from ABC. The tabloid grew its average daily circulation by 5% month-on-month to 223,727. No other paid-for national newspaper grew its circulation by more than 3% in June, making it a slightly slower overall rate of month-on-month recovery than was seen in May. The Evening Standard began to distribute more copies again as lockdown gradually eased, taking it back up by 8% to 489,154 – still almost half its distribution last year. The Sunday Express and Financial Times saw their circulations drop slightly between May and June.
3. As reported by Press Gazette, the UK’s largest newspaper group Reach has announced plans to cut 550 staff (or around 12% of its workforce). The cutbacks are part of changes intended to deliver savings of £35m a year at a one-off cost of £20m. As of 2019, Reach employed 2,598 journalists and editorial staff across 150 national and regional press brands. Reach is planning to launch its own news wire as part of plans to combine its national and regional editorial teams across the UK and Ireland.
4. Press Gazette reported that the Mail titles returned to profit in June but saw revenue down 30% in the second quarter of the year. Advertising in DMGT’s consumer media division was down 45% in the three months to 30 June and circulation revenue was down 12%. DMGT’s consumer media titles comprise: the i, Daily Mail, Mail on Sunday, Metro and Mail Online. The lockdown has been particularly tough on free title Metro which has seen circulation fall to a quarter of its normal level of 1.3m per day.
5. As reported by Press Gazette, magazine publisher Future has paid back its furlough money from the Government as it expects to grow profits this year despite the coronavirus crisis. Future said it remains on track for its 2020 financial year to be towards the top end of expectations, with adjusted earnings (EBITDA) for the year ending 30 September of between £86.3m and £91m. In 2019, Future reported adjusted EBITDA of £54.5m.
6. Press Gazette reported that Guardian Media Group is planning to cut 12% of its workforce as the Covid-19 pandemic has taken £25m off the publisher’s forecast revenues for the next year. It told staff it expects to cut around 180 jobs in total, with 70 of those in editorial. Guardian News and Media currently has 1,495 staff of whom 869 work in editorial and production.
7. The Guardian’s Saturday edition could lose several of its sections under cost- saving proposals which will see 70 journalism jobs cut. The Weekend, Review, The Guide, and Travel sections are all set for closure as part of “significant changes” proposed. The change would leave only the Sport, food magazine Feast and opinion and analysis Journal supplements remaining. A Guardian spokesperson told Press Gazette there are plans for a “new and exciting” Saturday supplement that will cover features, culture, books and lifestyle journalism. A statement written on behalf of editors and writers on the Saturday supplements, said: “Cut all the supplements, especially the glossy magazine, and you are cutting off the reason people pay for the paper. Why attack what has always been the paper’s cash cow? This whole thing looks like a massive act of self-sabotage.”
8. As reported by the Press Gazette, music magazine Q is closing after almost 34 years as owner Bauer Media has failed to find a buyer. The final issue of Q, its 415th, will be published on 28 July. It was founded in October 1986 by the Emap media group and sold to Bauer in 2008. Editor Ted Kessler tweeted: “The pandemic did for us and there was nothing more to it than that.” Bauer is also closing car magazine Modern Classics on 29 July while it has sold the magazines and websites of Sea Angler, Car Mechanics and Your Horse to Kelsey Media.
9. Press Gazette reported that Immediate Media is planning to cut up to 113 jobs and close 12 magazines. Seven of the magazines set to close are based in Bristol and fall within the craft, home and specialist categories, with the other five titles based in London and aimed at children. The publisher said that although it has seen “impressive growth” in print subscriptions and digital audiences since the pandemic began, it has been significantly negatively impacted in some areas of the business by the downturn in the advertising market and falling newsstand sales as people stayed home during lockdown, and overseas sales.
10. As reported by Press Gazette, men’s news, sport and lifestyle website Joe.co.uk has been bought out of administration. It will now be run by former Unilad executives who say they have “many unused plans” they can now transfer to the brand.
11. Hold the Front Page reported that Google has revealed plans which would see it pay for free access to paywalled articles on UK news publishers’ websites. The technology firm says it will “shortly be starting discussions” with media organisations in the UK about the proposals. Google has already signed such partnerships with local and national publications in Germany, Australia and Brazil. The plan was revealed in the company’s response to questions from Lord Gilbert of Panteg, chair of the House of Lords Communications and Digital Committee, which is conducting an inquiry into the future of journalism.
Legal
12. Johnny Depp’s libel claim against The Sun came before the High Court in London this month. Depp is suing the tabloid’s publisher, News Group Newspapers, and its executive editor Dan Wootton over an April 2018 article that accused him of being violent towards ex-wife Amber Heard during their marriage and labelled him a “wife beater”. Depp testified at length earlier in the case, accusing Heard of violence toward him. The newspaper has argued in court that it was “entirely accurate and true” to call Depp a “wife beater,” and Heard has been testifying on its behalf, speaking about private details of the marriage, including drug and alcohol use. The case is due to finish at the end of July.
13. As reported by the Guardian, the Duchess of Sussex is seeking a court order to prevent the publisher of the Mail on Sunday from publicising the names of five friends who could be witnesses in an ongoing legal dispute. Meghan is suing Associated Newspapers over articles in the Mail on Sunday last year that included parts of a handwritten letter she had sent to her estranged father, Thomas Markle, in August 2018. The Mail justified publishing the letter by saying five unnamed friends of Meghan had put her version of events in interviews with the US magazine People. Her legal team say it is untrue that she authorised or arranged for her friends to tell People about the letter.
Political
14. Bill Wiggin MP (North Herefordshire, Conservative) tabled a question asking the Secretary of State for Digital, Culture, Media and Sport, whether his Department plans to work with IMPRESS or other independent regulators.
Rt Hon John Whittingdale MP (Maldon, Conservative) has responded: “An independent press is vital to a strong and healthy democracy. The government is supportive of the independence of self-regulatory bodies. Ministers and officials are open to engagement with such bodies.”
15. Bill Wiggin MP (North Herefordshire, Conservative) tabled a question asking the Secretary of State for Digital, Culture, Media and Sport, how many members of the public have written to his Department in support of the Save the Independent Press campaign.
Rt Hon John Whittingdale MP (Maldon, Conservative) has responded: “The Department has received correspondence from a range of stakeholders, including from members of the public.
This Government is clear that newspapers play an invaluable role in the fabric of our society and we continue to work with stakeholders from across the Press sector and political landscape in order to ensure the effectiveness of our policies in relation to supporting all news publishers, including independent outlets. The Government will continue to consider all possible options in the interests of promoting and sustaining high-quality news journalism across the sector.”
16. Daisy Cooper MP (St Albans, Liberal Democrat) tabled a question asking the Chancellor of the Exchequer, what recent assessment he has made of the potential merits of introducing tax credits for (a) print and (b) online subscriptions to (i) newspapers and (ii) magazines.
Jesse Norman MP (Hereford and South Herefordshire, Conservative) has responded: “The Government recognises the important role that media organisations, including newspapers and magazines, play at a national and local level in our democracy and the life of our communities.
In light of this, the Cabinet Office has spent up to £35m from April to June to place Covid-19 public health messages in local and national newspapers. This advertising partnership with UK media titles has been supporting the familiar voices of over 600 national, regional and local titles across England, Wales, Scotland and Northern Ireland.
In addition, as announced at Budget on 11 March, the Government legislated to apply a permanent zero rate of VAT to supplies of e-publications from 1 December 2020 to support literacy and reading in all its forms. Following the outbreak of Covid-19, the Government then legislated to bring forward the implementation date to 1 May 2020, helping to reduce the cost of access to online publications while many people are confined to their homes and schools are closed.
There are a wide range of factors to consider before introducing a new income tax relief. The Government is committed to managing the public finances in a disciplined and responsible way, targeting support where it is most needed. New tax reliefs are difficult to target in this way. They are of greatest benefit to those paying higher rates of tax and do not benefit low-income individuals whose income is already below the personal allowance.”
17. A House of Lords committee on democracy and digital technologies, chaired by Labour peer David Puttnam, has called on ministers to push ahead with the online harms bill and to overhaul rules for online political advertising. Also among the dozens of recommendations in the 153-page report is that Ofcom be given the power of new sanctions against tech firms that fail in their duty of care, including fines of up to 4% of global turnover, or blocking the sites of those found to be serially non-compliant. The peers on the committee, which made the recommendations unanimously, argued that too much power had been given away to a “few unelected and unaccountable digital corporations”, such as Google and Facebook, and “a pandemic of misinformation and disinformation” is eroding trust in politics and public institutions.
18. A group of MPs is calling on the UK Government to immediately launch a new body to regulate social media giants whose bosses have “failed to tackle” the Covid-19 infodemic. Julian Knight MP, chair of Parliament’s DCMS Committee, said: “Evidence that tech companies were able to benefit from the monetisation of false information and allowed others to do so is shocking. We need robust regulation to hold these companies to account. “The coronavirus crisis has demonstrated that without due weight of the law, social media companies have no incentive to consider a duty of care to those who use their services.” The committee suggested delays to online harms legislation – “promised by the Government 15 months ago” – have helped coronavirus misinformation to “spread virulently”.
19. As reported by the Guardian, Jo Stevens, the shadow secretary of state for digital, culture, media and sport, has said the government must ramp up its efforts to counter online hate rather than delay its digital protection legislation. “The government promised this bill more than a year ago – it’s high time they showed they take the safety of those who use the internet as seriously as the needs and influence of the big tech firms.” A DCMS spokesperson said: “There is no delay, and we continue to work at pace to deliver the most comprehensive regime to tackling online harms anywhere in the world. We will bring forward new legislation after we publish the full government response this autumn as planned. We will introduce new laws to place a duty of care on online platforms to ensure they keep their users safe.”
Regulatory news
20. Following press coverage about the Public Interest News Foundation’s grant to IMPRESS-regulated online news publication 5Pillars, which alleges that 5Pillars publishes conspiracy theories about terror attacks, IMPRESS has released a statement: “We are in the process of gathering information in relation to these allegations, so we can assess whether there is a case to answer. IMPRESS has not received any formal complaints about these allegations to date. To avoid compromising the fairness of any potential investigation into these matters, IMPRESS cannot comment further at the present time. IMPRESS is an approved regulator under the post Leveson Royal Charter on self-regulation of the press. Any concerns about the standards of content or news gathering activities of any of the titles that we regulate should be referred to us without delay. IMPRESS is independent of the publishers it regulates and will investigate any concerns that are brought to our attention fairly and impartially.”
21. IMPRESS has announced two new appointments to its board: Cordella Bart- Stewart, Director of the Black Solicitors Network; and Debrah Harding, Managing Director of the Market Research Society.
Campaigners’ news
22. Hacked Off has published a new report titled ‘Racism and Fake News in the Wild West of newspaper comment sections.’ It sets out the findings of a review of newspaper comment sections which found “fake news”, conspiracy theories and racist language had been published in comments and remained accessible for, in some cases, at least three months. Policy Director Nathan Sparkes said: “Our review of newspaper comment sections found more than four dozen examples of fake news, conspiracy theories and racist abuse. But IPSO have failed to take action on a single one … The Government is planning to regulate every social media platform apart from those operated by powerful billionaire newspaper publishers. Its approach is irrational and endangers the public as much as online abuse and disinformation on Facebook and Twitter. It smacks of the worst kind of collusion between press and government. We urge the Government to get serious about Online Harms and the dangers they pose to all of us, by introducing an effective regime which captures dangerous online harms wherever they occur.”
23. The Society of Editors (SoE) says the government should resist the urge to rush towards censorship of the internet, after MPs called on the government to rush through legislation aimed at combatting misinformation by threatening the digital platforms with fines, bans and even imprisonment if they do not do more to prevent the spread of harmful opinions. “It would be far better if the government took steps to support the role of the mainstream media in counteracting fake news rather than attempting Canute-like to hold back the tide of misinformation through threats and censorship,” commented the SoE’s executive director Ian Murray.
24. Hacked Off has found that employees of Murdoch-owned companies met with the government more than 200 times in the last two years. The details of what was discussed at these meetings has not been published. Hacked Off Policy Director Nathan Sparkes said: “Sir Brian Leveson, in the first part of his Report, was explicit that the detail of any media policy matters discussed in these meetings should be published, yet this recommendation has been ignored by the Government. Instead, Mr Murdoch’s employees are able to lobby the Government for policy favours – on media policy, but also in other policy areas – in near total secrecy.”
25. In response to a DCMS Select Committee report on the impact of coronavirus on DCMS sectors, which did not cover media or telecoms sectors in detail, the News Media Association has said: “The coronavirus pandemic has had a profound impact on the news media sector and prompt action is required to ensure that publishers can continue to serve audiences with the trusted news and information they require in ever increasing numbers … The NMA has warned that the coronavirus pandemic has led to severe declines in ad revenues, up to 80 per cent for some publishers, and the sector is facing mass redundancies and title closures unless further Government support for news media is forthcoming. The NMA is calling on Government for swift measures to help the industry recover quickly from the pandemic such as business rates holiday for news media, and swift action to level the playing field with the tech giants following the Competition and Markets Authority’s report on the digital advertising marketplace.”