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Jeremy Hunt Considers Changes to Local Media Merger Rules

Following the OFT’s controversial decision to refer the sale of seven Kent Regional News and Media titles and the subsequent announcement of the closure of two of the newspapers, Culture Secretary Jeremy Hunt has said he is looking at the possibility of introducing legislative changes to the processes to make it easier for the local newspaper sector to consolidate.

Giving evidence last week to the Lords Communications Committee on the future of investigative journalism, Mr Hunt said: “We have to look at the process of media merger approvals when it comes to small organisations in the new technology environment we are all facing and see whether that can be improved.” He said it should not be for the Culture Secretary or the Business Secretary to decide whether titles could be sold “but that does not mean to say that we do not have responsibility for the process.”

When questioned about the OFT‘s decision on the Kent titles, Mr Hunt told the committee: “I support the independence of competition authorities, I do not want to go and criticise every decision they make. That would risk undermining that independence. But I do understand the concerns expressed by many people about that particular deal.

I think you are absolutely right to say that the issue involved was primarily one of cost. It is not unreasonable, and I do not think that Northcliffe or Kent Messenger Group object to the idea of the competition authorities looking at their particular deal, but the process was so expensive that in the end it just became impossible for a small company to bear the cost of going through a full Competition Commission inquiry.

I have asked my officials to look at what can be done in those processes and, indeed, whether, if there are any legislative changes to be made, they can be made in the Communications Bill that we are intending to put before Parliament in this Parliament.

It is clear to me that the local newspaper sector needs to consolidate. It needs to be able to develop new business models. I am a big champion of local media, which is why I have been advocating local TV. However, it is not just local TV; I want all local media to thrive and be able to develop new business models. It would be great loss to local communities and democracies if it did not. That is the policy context.”

Geraldine Allinson, chairman of Kent Messenger Group and president of the Newspaper Society, had earlier given evidence to the same inquiry. She said: “We told the Office of Fair Trading at the very beginning when we first went to them that if they were going to refer this to the Competition Commission the deal would end up being dead because of the costs associated with it. I fundamentally believe, and I think the industry does, that those titles would have been better off in our ownership because we would be able to provide a better service through better journalists, better quality of service to those communities for longer, including investigative journalism…”

Since the OFT decision to refer the deal, Northcliffe Media has announced that two of the titles concerned, the Medway News and the East Kent Gazette, would have to close with the loss of 38 jobs.

The NS is the voice of Britain’s local media, the UK’s most trusted medium. It represents 1,100 newspapers, 1,700 websites and other print, digital and broadcast channels.