Considered as a productive activity in itself, advertising generates well over £20 billion a year and employs around half a million people. British advertising creatives have a worldwide reputation for clever, witty and effective TV and cinema commercials. The industry is our second largest service exporter.
There are instances where advertisers get things wrong, possibly generating ‘negative externalities’ in economists’ jargon. This may justify some regulation. But we have gone much too far in controlling what can or cannot be said by those seeking to sell products.
Until the mid-1950s advertising was largely unregulated, subject only to the laws relating to fraud and defamation which also affect other forms of speech. Since then, direct government restrictions have grown, spreading from prescription medication and tobacco to alcohol and gambling. They are still growing.
The latest planned restrictions, following our overweight Prime Minister’s brush with Covid mortality, cover foods high in sugar, salt or fat. This embraces a wide range of products including many traditional dietary staples and not just the ‘junk food’ which politicians decry. Many food producers will suffer: food processing, from biscuits to ice cream to chilled ready meals, is our largest manufacturing sector.
Such paternalistic interventions, aimed at reducing harms allegedly caused by legal economic activity, treat people as incapable of making their own choices. Restrictions also reduce competition, sometimes entrenching the market dominance of existing producers, and discourage innovation. They can have knock-on effects on other activities as sponsorships are forbidden. For instance, a proposed ban on gambling logos on football shirts will hit lower-division teams hard.
Experience suggests that some bans achieve rather little at excessive cost, but at least they will have been discussed in Parliament. More worrying is the way regulators have developed ambitions for further interventions, with these ambitions often being unclear to the general public.
Many restrictions now come not from the government but from what is ostensibly industry self-regulation by the Advertising Standards Authority (ASA). This is a private body which has morphed in the last sixty years from concern with ensuring that advertising is ‘legal, decent, honest and truthful’ to a much wider and more problematic brief.
Today’s ASA deliberately attempts to change public attitudes through forbidding representation of certain types of otherwise lawful behaviour which may give offence to some groups – or at least to those who purport to speak on their account.
The ASA’s interpretation of ‘offence’ and ‘harm’ differs from the view taken by others concerned with regulatory issues, such as Ofcom, let alone the general public. As a consequence, creative expression which is permissible in television and films, YouTube, the theatre, books and newspapers is in effect forbidden in advertising – often on the basis of a handful of complaints about, for instance, the way families are depicted.
The regulatory powers and influence of the ASA are creeping into ever more areas of our society and culture – from new media to gender issues and ethnicity. It has produced a number of rulings – for example, a swimwear TV commercial for Missguided and a Paddy Power newspaper advert featuring the boxer Floyd Mayweather – which both challenge common sense and override expensive prescreening processes through Clearcast (a body set up by TV companies precisely to ensure advertisers keep to the rules). Decisions are made based on definitions of offence which many would dispute, including other regulators. Ofcom, for instance, is markedly more permissive about TV programme content than the ASA is over TV commercials.
There are pressures from campaigners to widen the scope of restrictions, and the ASA is sympathetic: it has indicated it wants to extend its regulation to cover a range of climate change issues. And, extraordinarily, it has recently made a strong demand that political advertisements and manifestos be regulated, something the Electoral Commission has previously firmly rejected.
The ASA is increasingly imposing the attitudes of an educated elite on advertisers, and thus on what the public is allowed to hear and see. The ASA Council, which makes decisions on complaints, consists of individuals unrepresentative of ordinary consumers, who are largely drawn from the ranks of career administrators in quangos and charities.
Free speech is under attack from many directions, but the threat from over-enthusiastic advertising regulators is little understood. We really should not ignore it.
Prof Shackleton is the author of the new IEA report “Ad Break: Why curbs on advertising harm free speech”, which you can read here.