The House of Lords has called for the creation of a digital super-regulator to oversee the different bodies charged with safeguarding the internet and replace the “clearly failing” system of self-regulation by big technology companies.

A new Digital Authority is the chief recommendation of the Lords’ communications committee report, which warns that the patchwork quilt of more than a dozen regulators that oversee the digital realm creates gaps and overlaps.

Big tech companies, it says, have failed to adequately tackle online harm, and Ofcom’s remit should be expanded to include responsibility for enforcing a duty of care on those companies.

The chair of the committee, Lord Gilbert of Panteg, called on the government to be less reactive in how it responds to digital risks: “The government should not just be responding to news headlines but looking ahead so that the services that constitute the digital world can be held accountable to an agreed set of principles,” he said.

“Self-regulation by online platforms is clearly failing and the current regulatory framework is out of date. The evidence we heard made a compelling and urgent case for a new approach to regulation. Without intervention, the largest tech companies are likely to gain ever more control of technologies which extract personal data and make decisions affecting people’s lives.”

The Digital Authority should be guided by a charter of 10 basic principles of online regulation, the lords say. These include:

• Parity: “There should be the same level of protection online as offline.”

• Transparency: “Powerful businesses and organisations operating in the digital world must be open to scrutiny.”

• Recognition of childhood: “The most vulnerable users of the internet should be protected.”

The main role of the authority would be hands-off, leaving the existing regulators, such as the ICO, Ofcom and the Advertising Standards Authority, to continue their work . Instead, its function would involve oversight of the full spectrum of regulation, recommending new legislation when there are clear gaps, mediating when there are overlaps, and reporting to parliament periodically on the state of regulation of the internet.

“We recognise that this would give the Digital Authority significant powers,” the report says. “This is necessary because of the magnitude of urgent social and political problems caused by regulatory fragmentation in the digital world. These problems are likely to become more complex as technology develops.”

The report also recommends a plethora of smaller changes to existing regulations, whether or not the Digital Authority is created. These include a new public interest test for data-driven mergers and acquisitions, to protect the public from having data bought and sold without consent, and new powers for the ICO to audit technology companies’ use of algorithms in decision making.

The Lords also called for a requirement for services to default to strictest privacy and safety settings, which users can then voluntarily lower, rather than the current norm of opting users in to the settings that make most financial sense for the business itself.

“The Information Commissioner’s Office should provide guidance requiring platforms to provide greater choice to users to control how their data are collected and used,” the Lords add.

The report has harsh words to say about major technology firms including Google, Facebook and Amazon.

“Major platforms have failed to invest in their moderation systems, leaving moderators overstretched and inadequately trained,” it concludes. “Online platforms should make community standards clearer through a new classification framework akin to that of the British Board of Film Classification.”