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Postal Services Bill [HL]

Amendments 89C and 89D add specific matters to what Ofcom must take into account before coming to the view that a service is interchangeable from the point of view of users, with a service set out in the universal postal services order: namely, the characteristics of the services, including added-value features, as well as the intended use and the pricing. That would introduce a higher test before a service could be said to be interchangeable with a service in the universal postal service order. This has a knock-on effect on Ofcom’s ability to impose certain conditions, notably general universal service conditions that Ofcom may consider necessary to ensure that a universal service is provided in accordance with the required standards under Clause 37. In this instance, restricting Ofcom’s discretion to regulate can only weaken the protection of the universal service. This is because, as I explained earlier, Clause 36, in conjunction with other clauses, seeks to ensure that Ofcom regulates where this is proportionate, targeted and protects the universal service. 3.30 pm The Bill as it stands gives Ofcom the right amount of discretion. Ofcom can impose regulatory conditions only when this is proportionate and objectively justifiable under Schedule 6. There are also tests as regards when particular conditions can be imposed set out in the clauses themselves. As I have said before, Ofcom is an experienced regulator with targeted, transparent and proportionate regulation at the heart of its decision-making. In addition, the language used in this amendment is not clear. I accept that the words used come from a recital of the most recent postal services directive—a recital that we have borrowed from in using the phrase "interchangeable with a service" of a description set out in the universal postal service order. I believe that we have taken the meaning of the recital and made it into a provision which is clear. We expressly chose not to include the words set out in this amendment as they do not add clarity to the provision but, rather, introduce undefined and unclear terminology. That is not in the interests of anyone. I reassure your Lordships that Ofcom will objectively assess which services are in the scope of the universal service, and therefore what could potentially be regulated. The scope of the universal service is defined primarily by reference to the universal service order. As we have previously discussed, to decide which products should be provided as a universal service, Ofcom will carry out a thorough market assessment and a robust consultation. In turn, this will provide a strong evidence base for the scope of the universal service. In any event, Ofcom must regulate proportionately. Ofcom will need to target the regulation of the services within the scope of the universal service very carefully. In addition, according to Schedule 6, Ofcom can impose regulatory conditions only when this is objectively justifiable. Therefore, there is no reason to assume that merely because a service can be regulated it will be regulated. We have made sure that a service cannot be regulated unless Ofcom can show that the tests required by the Bill are met. As regards safeguards, Section 3 of the Communications Act on better regulation applies. In view of this, I ask the noble Lord to withdraw his amendment.