BBC: Finance and Independence

Baroness Chisholm of Owlpen Excerpts

Thursday 10th September 2015 Lords Chamber

[Baroness Bakewell (Lab)]

My Lords, I am delighted to see here so many people who have a share in the television industry generally and an interest from a board viewpoint. This is a matter that concerns us all and will go on concerning us for some time.

This debate follows one held in early July introduced by the noble Lord, Lord Fowler. Two days afterwards, on 16 July, the public consultation on the BBC’s charter review opened. That consultation runs for just another four weeks from today. The Government have reiterated that there will be an 18-month window of consultation; for the public it appears that it is a mere three summer months, far from enough time for them to consider the uniquely important changes to what I believe is a pillar of our civic society, an institution of global reach and reputation that belongs not to the Government or the state but to the licence fee-paying public who use it.

Let me begin by asking if the Government would please extend the period of public consultation about this important institution. I address the future of the BBC in a mood not of confrontation but of commitment, but it is proving to be a rocky road. Both Jeremy Hunt and Sajid Javid, as Culture Secretaries, said quite openly, “Yes, the licence fee might well be reduced”. John Whittingdale, the current Secretary, has compared it to the poll tax. Reports from the election campaign bus reported David Cameron as saying, jokily, that he would close the BBC down after the election. Impromptu jokes can often reveal the inner man. The Daily Telegraph headlined: “Tories Go to War with the BBC”. So, we have been well warned.

After the election, the Government moved fast and on several fronts. Their proposal to decriminalise the non-payment of the licence fee could, if it goes ahead, cost the BBC some £200 million. George Osborne corralled the BBC into paying for the free television licence for the over-75s. That was without consultation. It will be at a cost to BBC funding of some £725 million. George Osborne frequently claims that the BBC,

“like much of the rest of the public sector”,

must contribute to the Government’s austerity campaign. The BBC is not part of the public sector like any other: it is an independent body set up and guaranteed by charter. It is wholly wrong for the Government to refer to it in those terms and to load such an institution with what are cuts to their social services budget. The new settlement must outlaw any such smash-and-grab raids in the future.

This calls into question the whole matter of charter renewal and the future funding of the BBC. There is talk of a groundswell of feeling that changes in viewing patterns and technology make the licence fee outdated and in need, if not of outright abolition, of severe control. That feeling comes not from the public at all. There is no popular outcry against paying for the BBC. The BBC commissioned independent research into the matter. A series of families around the country—families who said that they were completely indifferent as to whether the licence fee went or not—went without the BBC’s availability in their homes for nine consecutive days. At the end, two-thirds of them had changed their minds. One among them said that living without the BBC was “absolutely dreadful, just awful”. They found that the BBC’s cost, at £12 a month, was remarkable value compared with, say, Sky’s £70 a month. And the BBC’s service has, uniquely, no commercials—no intrusive interruption to the narrative and creative flow of individual programmes. The BBC is under attack not from the public but from two other sources: namely, the Government of the day and vested media interests—which, of course, command the headlines and thus distort the scale of wider public interest and concern. I refer to the Daily Telegraph’s headline, among others.

It is in the nature of the BBC to be attacked by Governments; it has been so since its earliest days. Churchill wanted to take over the studios during the war. Eden was furious over Suez. Mrs Thatcher complained about coverage of the Falklands War. Tony Blair was enraged by coverage of the Iraq war and the death of David Kelly. It is a testimony to the fact that the BBC, unlike other non-commercial national broadcasters, is not in the pocket of government or required to do their bidding. The BBC’s coverage aims to be fair and balanced. Its training schemes for journalists endorse such values. That is not to say that the BBC does not make mistakes. Recently, it has made some really big ones; for example, over the reporting of the Savile scandal and the aborted digital media initiative.

The renewal or revision of the BBC’s licence fee is the one place where the Government can exercise a direct, profound and unqualified influence. Thus, finding the balance at this point between the BBC and government is at the heart of our democratic process and, I hope, of today’s debate. To date, there have been eight charters, varying in length between five years and 15 years. For the first time, however, a significant option is included in the current charter review, asking simply whether the existing charter and agreement should continue at all.

The charter was created to guarantee the BBC’s independence from Parliament and from government. Any new framework dreamed up by either side of government is, I insist, likely to bring the BBC more effectively within their control. One can be sure that matters of bias, censorship, political neutrality and the scope and scale of its activities will all be drawn closer within any Government’s oversight and jurisdiction—that control being effected by the ongoing financial manipulation of the BBC’s income by the Treasury as directed by the Government of the day. Who is to say where it might end? This is to be resisted on the widest possible front as bad for broadcasting, bad for creative initiatives, bad for the freedom to try daring new formats to encourage experiment and change, and, more fundamentally, bad for the democratic values of fair reporting that underpin our civic society.

The BBC has many faults that need addressing—I work for it, I should know. It is still overmanaged and has too many layers of managers telling the creative classes what to do. It overrewards its headline stars and its pension settlements for managers have been extravagantly high. There is lack of clarity around its governance structures. There needs to be change—change from within. Indeed, the current director-general, Tony Hall—the noble Lord, Lord Hall—is embarked on an extensive programme of just such change. The BBC needs to be more flexible and more responsive to the fast-changing world of global television. Its governance needs to be examined to see whether the BBC Trust has outlived its usefulness. Its own chairman seems to think so. I hope that this debate will address many of these topics.

The BBC faces suggestions of a more fundamental change than we have ever seen. The Government seek to instruct it on the type of programmes that it should make. The scope and scale of programmes should, they suggest, be of a narrower and more targeted range, possibly giving up its most popular formats. In other words, it should be cut down to size. They insist that that is to be done because the landscape of broadcasting is changing and growing, as newspapers—particularly local newspapers—languish and decline. It is also done at the siren call of vested interests—interests which are well represented in the 12 men and women whom the Government have appointed to advise on it.

It is a healthy media landscape when rival organisations succeed and flourish, and many are doing so. Sky News and ITN win as many awards, and sometimes more awards, than BBC News. In July, ITV reported a 23% increase in half-yearly profits. Sky announced a record turnover and full-year profits of £1.4 billion, and nearing an audience of 12 million in the UK and Ireland. The idea hinted at in the Government’s Green Paper that the BBC’s operation is “crowding out” its commercial rivals does not match the facts.

Meanwhile, BBC formats are popular around the world. Outside the US’s main studios, BBC Worldwide, the BBC’s commercial arm, is the largest distributor of programmes in the world. It has a turnover of £1 billion, with headline profits of £168 million. Such is the nature of the television industry that for any media enterprise to succeed it must cover a whole range of platforms and, of course, have a thriving website. The BBC does this well. Its website ranks in the top 100 in the world. Its channels have increased from two in 1994 to nine in 2014. Yet, over the same period, channels available in the UK have grown from 61 to 536. Clearly the BBC is not crowding them out. The BBC’s commercial rivals have spent more on the rights to Premiership football alone than the BBC spends on all its content, yet the Government expect the BBC to make severe cuts. Why would any Government want to cut down such a success?

As Armando Iannucci declared in this year’s MacTaggart lecture at the Edinburgh Festival,

“if the BBC were a weapons system, half the cabinet would be on a plane to Saudi Arabia”,

to say how brilliant it is. Let us celebrate and support this major British institution and not cut it down to size.

[Baroness Chisholm of Owlpen (Con)]

My Lords, I respectfully remind all speakers from now on that they have only four minutes. Please could they watch the clock carefully?