LIVE ISSUE/GOVERNMENT POLICY ON ADVERTISING: Is the Govt softening its hard line on advertising? - Industry chiefs are happy to see Peter Mandelson at the DTI, Andrew Grice says

When Peter Mandelson became Labour’s director of communications in 1985, he ended the party’s traditional hostility towards advertising as part of his cultural revolution of Labour’s style.

When Peter Mandelson became Labour’s director of communications in

1985, he ended the party’s traditional hostility towards advertising as

part of his cultural revolution of Labour’s style.



As Tony Blair’s new Trade and Industry Secretary, Mandelson now has the

chance to cement Labour’s ever-closer relationship with the ad industry

by ensuring the Government pursues policies that help rather than hinder

it.



The early signs are good. The lingering hopes of a relatively small

number of Labour MPs that the Government would impose a statutory system

of controls over advertising have been dashed by the sacking of Nigel

Griffiths, the hyperactive Consumer Affairs Minister (Campaign, last

week).



Before last year’s general election, Griffiths threatened to replace the

Advertising Standards Authority with a government body unless the

industry put its house in order.



Although Griffiths warned that Labour ’wouldn’t hesitate to legislate’,

the threat never materialised - partly because his interventionist

instincts were not shared by the Blair Government as a whole and partly

because he was open-minded enough to be persuaded that self-regulation

was broadly working.



Now Griffiths has been replaced by Kim Howells, an arch-moderniser

committed to a hands-off approach. Howells, a former official of the

National Union of Mineworkers, angered left-wingers in 1996 when he said

Labour’s days of ’continual meddling’ in industry were over and urged

them: ’Brothers and sisters, embrace competition.’



Colleagues say Howells will bring a different approach to Griffiths to

debates over advertising. ’He will champion the consumer but he won’t

get involved in populist actions to get us a cheap headline,’ one

Department of Trade and Industry source says.



Andrew Brown, director-general of the Advertising Association, comments:

’There are certainly no alarm bells ringing about the arrival of Kim

Howells, who is seen to be pro-business and a non-interventionist.’

However, Brown admits to a ’tinge of regret’ at Griffiths’ departure,

because he had held Labour’s consumer affairs brief since 1989 and had

built a working relationship with the industry. Although Griffiths had

’a bee in his bonnet’, Brown says, he had accepted since taking office

that the Government would not intervene unless self-regulation had

palpably failed.



What, then, should the industry make of Mandelson? His free-market,

pro-competition instincts are already being contrasted with those of his

predecessor, Margaret Beckett, dubbed ’Mrs Blockit’ for referring

mergers to the Monopolies Commission.



Although he is anxious to live down his reputation as a campaign

strategist and spin doctor and become a serious politician in his own

right, Mandelson will not lose his interest in communications which

should bode well for advertising. The AA will press him to give greater

prominence to the industry’s role when he publishes a flagship white

paper on competitiveness in the autumn. (The Government has acknowledged

the importance of marketing generally, but not advertising.)



Mandelson can be expected to keep a close eye on the multimedia

revolution.



If he had become Culture Secretary in the reshuffle (which was widely

rumoured), he would have been tempted to turn the Department of Culture,

Media and Sport into a powerful communications ministry which would have

pinched responsibility for new media and telecommunications from the

DTI.



Now Mandelson is at the DTI, the boot could be on the other foot.

Perhaps Chris Smith, the Culture Secretary, had better be on his guard

for a reverse takeover by the DTI.



One potential downside of Mandelson’s appointment for the ad industry is

his strongly pro-European instincts. A key test will be whether he bats

for British industry if the European Commission follows its directive on

tobacco promotion with attempted curbs on alcohol, children’s foods or

toys. Mandelson might be prepared to cede more power to the European

Parliament, where the views of the majority Socialist group are more

pro-bans and state intervention than at the DTI.



Mandelson’s hands-off approach to regulation will suit the ad industry,

although there could be a downside if the DTI takes its eye off the ball

during the passage of legislation which might inadvertently undermine

the self-regulatory system. ’That would be just as dangerous as

statutory control,’ Caroline Crawford, communications director at

Advertising Standards Authority, says. Both the AA and ASA hope to meet

Howells soon, when they will urge great vigilance over the Competition

Bill, the European Convention on Human Rights and freedom of information

legislation.



A new ASA poll suggests only 15 per cent of the public want a government

body to control advertising. But despite last week’s truce between the

ASA and the Consumers Association, the CA is sticking to its demand for

greater sanctions, including fines, and says a statutory body may be

needed.



’We had a very good relationship with Griffiths; he was probably

sympathetic,’ Benet Middleton, the CA’s head of policy, says. Despite

the new consensus between the Government and the industry, the debate

will run and run.



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