Public Service Broadcasting: BBC Centenary
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The Parliamentary Under-Secretary of State, Department for Digital, Culture, Media and Sport (Lord Parkinson of Whitley Bay) (Con)
My Lords, this has been a very spirited and thought-provoking debate, and a very enjoyable one for my first time back at the Dispatch Box. I warmly congratulate the noble Lord, Lord Foster of Bath, on securing it. He encouraged me to sign up to speak from the Back Benches and I had done so, but it is a delight to be responding with a bit more time from this position.
The noble Lord’s Motion encourages us to look to both the future and the past, but perhaps I should start with an observation about the present. It seems to me that we in the UK today are very lucky to benefit from a vibrant and diverse broadcasting sector. We have access to hundreds of television and radio channels, each of them unique. These are in turn supplied by a wealth of creative talent and distributed in innumerable ways, some cutting-edge and others which would be familiar even to the late Lord Reith himself—although I wonder whether he might have mellowed in his opinions on jazz.
Moreover, it strikes me, taking the long view, as today’s Motion invites us to do, that that success is due in no small part to the work of the BBC, first as the pioneer of radio, and later television, broadcasting, and then, over time, providing a different role, an important foundation on which so much else of our broadcasting heritage is built.
As the noble Baroness, Lady Bakewell said, 1922 was a very special year. It marked the publication of TS Eliot’s “The Waste Land” and James Joyce’s Ulysses, one of which I have read repeatedly and the other of which I am still struggling through, but both of which I have learned a great deal about in this centenary year thanks to the BBC’s programming about them.
However, as we heard, a lot has changed since 1922. The BBC is no longer our only broadcaster; indeed, it is not our only public service broadcaster. Strictly speaking, it is one of six but, taking a more rounded measure of public service, we might also include our eight local television providers and hundreds of local and national radio stations in that list. That does not even include all the programmes created and shown by commercial broadcasters that are nevertheless public service in nature.
The need for public service broadcasting in this country is as strong as ever it was. Whether that is breaking news footage of Russia’s illegal invasion of Ukraine, or lessons for children stuck at home during the pandemic, it is vital that our broadcasters understand the positive impact that they can and do have on our life in the United Kingdom: on our culture and values, on our economy and on the very cornerstones of democracy. They play a key role in bringing the nation together at our moments of greatest celebration and our moments of deepest sadness.
In particular, I echo the tributes paid by other noble Lords to our public service broadcasters, especially the BBC, for their thoughtful and respectful coverage following the recent death of Her late Majesty Queen Elizabeth II. As the noble Lord, Lord Bassam, said, more than half the country, 32.5 million people, watched the BBC’s coverage of the state funeral, and millions more watched it on ITV: a powerful example of what public service broadcasting can and should be about.
I agree with my noble friend Lady Harding that, in Parliament, it is our job as parliamentarians to hold public service broadcasting to account but also to provide a legal and regulatory framework which encourages and supports the contribution that the BBC and others make. Part of that framework, of course, includes the media Bill, which noble Lords in great number have asked about, understandably, today. Let me highlight what my right honourable friend the Secretary of State said last night in your Lordships’ House—not in the Chamber but in a reception held here. She said she is fully committed to introducing legislation to make sure that we are regulating in a way that is fit for the modern era, and that we will be coming forward with the media Bill shortly. I am afraid I cannot be more precise than that, but I am happy to echo her words that we will do that soon.
I will start with the legal and regulatory framework for the BBC. In January, the Government announced that the licence fee will be frozen for the next two years and will rise in line with inflation for the following four years. That means that the cost of the licence fee will remain fixed at £159 until April 2024, before rising in line with inflation until April 2028.
Concerns about the cost of living have been echoed in your Lordships’ House today and were central to the Government’s decision. The settlement aims to support households at a time when they need that support most, while also giving the BBC what it needs to deliver on its important remit. Under the settlement, the BBC will continue to receive around £3.8 billion in annual public funding, allowing it to deliver its mission in public purposes and to continue doing what it does best.
We believe that this is a fair settlement which strikes the right balance between protecting households and allowing the BBC to deliver its vital public responsibilities, while encouraging it to make further savings, efficiencies and innovations. The Government’s longer-term road map for reform of the BBC sees two forthcoming milestones as we prepare for the next review of the BBC’s royal charter: the ongoing mid-term review and the planned BBC funding model review. I will address each of those in turn.
At this point, half way through the charter period, work has already begun on the mid-term review. That will function as a health check, conducted by the Government and examining how effectively the governance and regulatory arrangements introduced by the current charter, such as the move to the new unitary board, are performing, and whether further reforms are required. The Government are interested in the success of the BBC’s governance and regulatory arrangements in enabling progress against our ambitions for greater impartiality, an effective complaints system and a BBC that represents the breadth of the audience it was established to serve.
That is not just about how well the BBC is doing. We also want to look at the effectiveness of the framework by which Ofcom holds it to account. The Government are seeking to conclude the review swiftly and to report on its findings next year. At the same time, the BBC’s funding model faces major challenges, due to how people consume media, as we have heard in this debate. Technology has revolutionised how, when and where audiences can access and watch content. An increasing number of households are choosing not to hold a TV licence as fewer people choose to watch live television or other activities which require a TV licence. If this trend continues as expected, that presents clear and looming challenges to the sustainability of the licence fee.
It is not just the Government who have these concerns. They have been echoed in today’s debate. Licence to Change: BBC Future Funding, the report of your Lordships’ Communications and Digital Committee under the chairmanship of my noble friend Lady Stowell of Beeston, whom I had the pleasure of sitting alongside, albeit briefly, in the last few weeks, found that the drawbacks to the current licence fee model are becoming more salient. We must consider how best to fund the BBC over the long term so that it can continue to succeed. It is therefore right that we examine the future of the licence fee. The Government will set out further detail on their plans in due course.
The BBC forms just one part of the UK’s vibrant public service broadcasting system. Our six public service broadcasters provide a wealth of important content—news and current affairs programmes which help us understand the world around us, original, distinctively British programming which shapes our culture and reflects our values, and programmes made in all corners of our nation and broadcast around the world.
The noble Baroness, Lady D’Souza, the noble Lord, Lord Bilimoria, and others, were right to praise the important work of the BBC World Service. The Government strongly support the BBC’s mission to bring high-quality and impartial news to global audiences in some of the most remote places in the world, particularly those parts of our globe where free speech is limited. The BBC is operationally and editorially independent from the Government, so decisions over its spending and services are a matter for the BBC, but the Foreign, Commonwealth and Development Office is providing the BBC World Service with over £94 million annually for the next three years, supporting services in 12 languages and improving key services, and that is in addition to the nearly £470 million which the Government have already provided through the BBC World2020 programme since 2016.
The noble Lord, Lord Dubs, was right to highlight the bravery of BBC journalists who report for the World Service, particularly in Iran. We regularly raise the harassment of BBC Persian staff directly with the Iranian Government as well as in multilateral fora, but I wholeheartedly agree with his tribute to them. Moreover, our public service broadcasters complement their commercial competitors by raising standards across the industry by investing in skills, boosting growth and taking creative risks. They drive growth in our booming production sector by commissioning distinctive public service content and supporting the hundreds of independent production companies that are the lifeblood of that sector.
This contribution is not limited to television. As the noble Baroness, Lady Bonham-Carter, noted, in celebrating 100 years of the BBC, we are celebrating 100 years of BBC radio. Since listeners first tuned in to daily news bulletins on its 2LO service, BBC radio has been a pioneer of public service content, from great drama to ground-breaking comedy, the newest music and the greatest of old, not least through its orchestras and choirs. Radio is also changing, as more and more people consume audio content online. With its unique position in the radio market, I hope we can have confidence that the BBC will continue to evolve to deliver high-quality and engaging audio services to the country and the globe over the years to come.
The noble Baroness, Lady Bonham-Carter, and others raised the announcements this week about changes to BBC local radio stations. Again, the BBC is rightly operationally and editorially independent of government, but the Government are disappointed that it is reportedly planning to make such extensive cuts to its local radio output. In an Answer to an Urgent Question in another place earlier this week, my honourable friend Julia Lopez set out that she is meeting the BBC next week and will be conveying to it the views raised in that Urgent Question. We wait to hear more from the BBC on how it expects these changes to affect local communities, including the provision of local news and media plurality.
As noble Lords have noted, it is not just the BBC celebrating an important birthday this year. On Tuesday, Sianel Pedwar Cymru, or S4C, the UK’s Welsh language television broadcaster, celebrated its 40th birthday. S4C is a great example of how our public service broadcasting provides for every part of the UK, not only providing an opportunity for Welsh speakers to access content in a language familiar to them but supporting the Welsh economy, culture, and society.
Channel 4 also celebrated its 40th birthday yesterday. It is an integral part of our public service broadcasting system and a great UK success story. Over the past four decades, Channel 4 has done an excellent job in delivering on its founding purposes, providing greater choice for audiences and supporting the British production sector, including in the diocese of the right reverend Prelate following its move to Leeds. The Government want Channel 4 to continue to deliver for audiences for the next 40 years and long beyond. My right honourable friend the Secretary of State is carefully examining the business case for the sale of Channel 4 and will set out further detail on our plans for the future of the channel in due course. As the right reverend Prelate and others said, there is much to be considered. The principal conclusions of the Government’s review of public service broadcasting were set out in our White Paper earlier this year and my right honourable friend will be able to draw on those conclusions when considering her decision.
I am grateful to the noble Lord, Lord Bassam, for giving me the opportunity to correct the record. He is right to pick up on an answer that I gave when last in this post, stemming from a confusion between salaries and total remuneration packages. One of the last things that I did before leaving was to write a letter to the Library of your Lordships’ House setting that out for the record; if it was not sent, I will make sure that it is. I am grateful for the opportunity to do that from the Dispatch Box.
Continuing with birthdays, as the noble Lord, Lord Inglewood, will remember particularly well as a former Broadcasting Minister, in March this year Channel 5 turned 25. It continues to make a vital contribution to the UK PSB system through its provision of news and its unique focus on children’s television.
Our two other public service broadcasters, ITV and STV, continue to play an important role both on and off the screen. Last year, STV was the most watched peak-time television channel in Scotland for the fourth year in succession, and in 2019, the most recent year for which detailed data are available, ITV spent more than £250 million outside London, directly employing more than 2,000 staff and indirectly supporting many more. That is not to mention its 3,000 hours of national and regional news, with “STV News at Six” having held Scotland’s number one news programme slot since 2019.
However, despite these ongoing successes, there are also challenges ahead for our public service broadcasters. I have referred already to some of the specific challenges facing the BBC, but in many ways, they are symptomatic of broader changes in the sector, which create both opportunities and risks. One of those is advances in technology. Just as the advent of cable and satellite services revolutionised broadcasting in previous decades so internet-delivered services are revolutionising it now, creating new distribution methods and potential business models. It is notable, for instance, that 79% of households with a television set now choose to connect it to the internet.
Changing consumer habits are also a factor. Today’s viewers now have huge choice in what they watch and how they watch it, and are taking advantage of that choice. Two-thirds of households subscribe to video-on-demand services like Netflix and Disney+, and in September 2021 YouTube reached 92% of online adults in the United Kingdom. Viewers are shifting to different platforms, types of content and modes of viewing: telephones, laptops, short-form, long-form, on-the-go and around the house. To be a successful modern broadcaster, it is important that broadcasters make their content available in a multitude of formats across a wide range of devices and platforms.
Increased competition is also changing the sector. New global players, particularly US-based streamers, as noble Lords have noted, are using their greater financial resources to compete with both our public service broadcasters and our commercial ones. That is not just a question of competition for viewers but for the programmes they show. In 2019, the public service broadcasters in the UK were collectively able to spend just under £2.8 billion on new content. At the same time, Netflix alone spent an estimated £11.5 billion on production globally.
In April this year, the Government set out their proposals for supporting our public service broadcasters, using our new legislative freedoms to deliver a regulatory framework which works in the best interests of the UK. We were able to draw upon much previous work, including the report of the Communications and Digital Committee of your Lordships’ House, at that time chaired by my noble friend Lord Gilbert of Panteg. As a result, the White Paper contained a number of proposals to support British broadcasters to prosper in this new media environment.
The first of these relates to prominence. An important part of our public service broadcasting system is ensuring that public service content is readily available to as wide an audience as possible and easy to find. But as audiences increasingly watch content online, our broadcasters, including the BBC, are finding it increasingly difficult to secure and maintain their presence on global platforms. We announced in our White Paper plans to legislate for a new online prominence regime, so that PSB content is made available and given protected prominence across designated TV platforms. Building on Ofcom’s recommendations, we believe that legislating for prominence will not only support the future sustainability of public service broadcasters; it will also mean that viewers can continue to find the content they value. We understand, and share, the concerns of our public service broadcasters that action to address this issue is needed as soon as possible. I am glad to hear that echoed in today’s debate.
I also want to touch briefly on the listed events regime, which helps to ensure the free and universal availability of key moments from some of our most loved sports. In recognition of the key role that our public service broadcasters play in distributing content which is distinctively British and of interest to audiences in the UK, the Government have announced their intention to make qualification for the listed events regime a benefit specific to our public service broadcasters. This will ensure that they have the opportunity to show national sporting events such as the Paralympic Games and the Women’s EUROs, both rightly praised by the noble Lord, Lord Addington, for years to come. We are considering whether digital rights should be brought in scope of the regime to reflect the rapidly changing viewing habits of UK audiences and the growth in on-demand streaming services.
Video-on-demand services such as Netflix and Amazon Prime provide huge value to UK audiences and in many cases significant, and growing, contributions to the UK economy. But these on-demand services, apart from BBC’s iPlayer, are not subject to Ofcom’s Broadcasting Code, which sets out appropriate standards for content, including for harmful or offensive material, accuracy, fairness and privacy. This means that the television-like content which people watch is regulated differently depending on how they choose to watch it. Some services available in the UK are not regulated in the UK at all. That is why we intend to bring larger TV-like on-demand providers, which are not regulated in the UK but which target and profit from UK audiences, under Ofcom jurisdiction. We will also give Ofcom powers to draft and enforce a new video-on-demand code, similar to the existing Broadcasting Code. These changes will mean that UK audiences will be better protected from harmful material and better able to complain to Ofcom if they see something about which they are concerned.
My noble friend Lady Harding of Winscombe was right that the people who are moving to these new methods of watching television the quickest are the young, and the noble Baroness, Lady Benjamin, was right to raise our important responsibility to children. UK-wide television tax reliefs aimed specifically at children’s television programming have since 2015 directly supported more than 500 projects and over £600 million of investment in children’s content. We are grateful to have worked closely with the noble Baroness, Lady Benjamin, on introducing powers for Ofcom to monitor the commercial public service broadcasters and enable them to set criteria for the provision of children’s television programming; and of course, we chose children’s television, alongside radio, to pilot contestable funding, as she mentioned in her contribution. An evaluation of the three-year pilot of the young audiences’ content fund is taking place to determine its impact. The potential for further investment will be assessed against that evaluation and future public service broadcasting needs.
The noble Viscount, Lord Colville of Culross, mentioned smart speakers. Today the whole sector faces perhaps its greatest challenge yet with the emergence of online audio services and smart speakers. I share the noble Viscount’s concerns about the potential impact of these devices on the radio sector. Officials in DCMS are actively exploring potential options for bringing forward legislation to protect the position of radio on smart speakers in a way consistent with the proposals to develop a new pro-competition regime for digital markets.
The noble Lord, Lord McNally, said that it was a Conservative Government who established the BBC. As this is a Liberal Democrat debate, I should say that a Conservative and Liberal coalition presided over its birth. The BBC was founded on 18 October 1922. The following day, Tory Back-Benchers met at the Carlton Club and pulled the plug on that coalition, giving the BBC its first big story to cover. Those were the days when Tory Back-Benchers brought down Prime Ministers from other parties. It was thus a Liberal politician, the Postmaster-General FG Kellaway, who noted:
“If the best use is to be made of this new form of communication, it must touch life at many aspects”.—[Official Report, Commons, 4/8/1922; col. 1955.]
I think we would all agree that our public service broadcasters have delivered on that vision. Now is the time, as we have done today, to look ahead to the next century and provide the foundations for future success. I am very grateful to the noble Lords who have given us the opportunity to do so.
Baroness Stowell of Beeston (Con)
Before my noble friend sits down, may I seek a couple of points of clarification on legislation? My noble friend echoed the Secretary of State in saying that the media Bill will be with us shortly. Yet a decision on the privatisation of Channel 4 has yet to be taken. Could he confirm that, if the Government decide not to go ahead with the privatisation of Channel 4, the media Bill will still come forward shortly because it is the non-Channel 4 aspects that are deemed incredibly urgent?
The Minister also made some comment in response to the noble Viscount, Lord Colville, on digital competition. However, I am not entirely clear on what he is saying about the prospect of a digital competition Bill. He may remember that I was very keen, if possible, that we should combine the two things, particularly if Channel 4 is no longer on the agenda.
Lord Parkinson of Whitley Bay (Con)
I am grateful to my noble friend for the opportunity to say a bit more. There is not much that I can add, other than to repeat the Secretary of State’s words from last night. We will bring the media Bill forward shortly and that does not pre-empt the decision she is considering vis-à-vis Channel 4. The Queen’s Speech set out the Government’s commitment to publishing a draft digital markets competition and consumer Bill in this parliamentary Session. We will do so as soon as parliamentary time allows.