Libel law reform at threat as House of Lords passes Lord Puttnam's Defamation Bill changes

Film producer proposes statutory regulation of the press and for publishers to face 'exemplary damages'

Plans to reform Britain’s arcane libel laws have been thrown into doubt after the House of Lords last night approved amendments introduced to the Defamation Bill by the film producer Lord Puttnam.

The bill, which has been three years in the making and had been intended to dispel the reputation of the High Court in London as the “libel capital of the world”, faces being scrapped.

Lord Puttnam introduced a series of changes to the legislation as a means of indicating the unhappiness in the Upper House at the failure of the Government to introduce proposals for press reform recommended by Lord Justice Leveson following his long running inquiry.

But the Labour peer’s amendment went further than Leveson and included plans for publishers to face “exemplary damages” and be answerable to a press regulator with statutory underpinning and an appointments panel headed by the Lord Chief Justice. He advocated that publishers would face extreme fines if they failed to secure “pre-clearance” for stories from an arbitrator.

Yesterday, during a third reading of the bill in the House of Lords, a new amendment by the former cabinet minister Lord Fowler struck out this “prior scrutiny” requirement, but the remainder of the Puttnam amendments were voted through.

The Defamation bill returns to the House of Commons where Conservatives are determined to stop it in its present form. But their ability to have the Puttnam changes removed is dependent on persuading Labour and the Liberal Democrats of the merits of a Royal Charter to implement Leveson without the use of law. Labour has publicly been critical of such an approach.

As a result, campaigners for freedom of speech – who have attacked the illiberal nature of the film producer’s proposals - fear the much anticipated libel reforms are in jeopardy. “It’s very disappointing,” said Kirsty Hughes, chief executive of Index on Censorship. “It still has the ability to completely undermine the Defamation bill and has confused Leveson with the libel bill. It’s really damaging game playing by Labour.” She described the “prior scrutiny” idea as a “tool of authoritarian regimes”.

Libel law reformers have been anxious to emphasise that the Defamation bill, which had all party support and was championed by the Deputy Prime Minister Nick Clegg, was not simply a press bill but was designed to protect all forms of publishers including bloggers, citizen journalists and scientific researchers.

Jo Glanville, director of the worldwide writers’ association English PEN, also said she was deeply unhappy with the Puttnam amendment. “Lord Fowler’s amendment has mildly improved it – that part was really unacceptable. But the key is what happens next. [The Government] hope the salvation is going to come over a deal being done over the Royal Charter.”

Lord McNally, the Justice minister responsible for the bill, said he hoped it could be rescued in the Commons. “I hope by the time it comes back the Puttnam amendment is out of the Defamation bill so that it is left as a single entity and the tri-party talks allow us to implement Leveson.”