Nick Clegg has called for a major shakeup of British media ownership laws in the wake of the Murdoch scandal, including far more restrictive controls on media ownership, as well as tighter definitions of what constitutes a fit and proper person to run broadcasting bodies.
In a speech prepared with Vince Cable, the deputy prime minister made it clear he was determined to use the judicial inquiry into the scandal to press for major changes in the media landscape, including inserting "some numbers" in terms of excessive media concentration so as to give definition to currently vague concepts like media plurality.
Cable, the business secretary – whom David Cameron stripped of responsibility for media regulation at Christmas after his private remarks "declaring war" on the Murdoch empire were broadcast – said he felt some private satisfaction at the turn of this week's events.
Cable also revealed that in referring the BSkyB bid to Ofcom last year he had overruled "very strong advice both inside and outside Whitehall to just let it through on the grounds that there was not really a case to answer and there would be strong legal reviews".
He described the atmosphere at Westminster as "a little like an end to the dictatorship when everyone suddenly discovers they were against the dictator".
Setting out a Liberal Democrat agenda for media reform, Clegg in a speech to the Institute of Government said he also wanted clearer definition on whether organisations, as well as individuals, could be deemed as not "fit and proper" to run media organisations. He said at present media lawyers disagreed on this issue.
He said the "increasing diversification of media sources does raise new issues over cross-media ownership, which is something the inquiry will now look at".
He also complained "the current plurality test can be used to prevent media mergers when they are deemed to undermine the public interest", but said this was never developed as a comprehensive safeguard.
The "plurality test can only be applied at the point of mergers or acquisitions", but does not cover companies which expand their market share gradually, over time, by natural growth, he said.
Clegg also suggested changes to the Competition Commission to report on public interest issues, which could include media plurality, in the same way as it can now for mergers.
The prospect of a tighter regulatory environment is certain to further discourage the Murdochs from continuing with major investments in the UK.
Clegg also argued the inquiry would have to look at corporate governance in media groups.
"All media organisations, the senior staff and board at News International included, should now be looking very hard at the composition of their boards and their systems of corporate governance," he said.
"We need to ask more widely whether corporate law in the UK does enough to push managers and directors into being more active. Something must be wrong when misconduct and law-breaking can become endemic within an organisation, while the senior staff do nothing. So we need to look at whether or not there is a failure of enforcement of the existing corporate governance rules. Or if the problems lie within the rules themselves."
Less controversially, Clegg said there was an inescapable case for an overhaul of the press regulatory system.
He said the Press Complaints Committee was at best a limited complaints body only able to respond if someone that was the victim of malpractice lodged a complaint.
He said the PCC did not provide real redress. "A person can have their public reputation left in tatters after ruinous accusations splashed across a front page and all the PCC gets them is a short apology hidden somewhere at the back of the paper. And the PCC doesn't even cover the whole industry.
"Major news outlets can opt out. And that is precisely what has happened with the Daily Express, the Sunday Express and the Daily Star."
