BBC: Finance and Independence

Lord Macdonald of Tradeston Excerpts

Thursday 10th September 2015 Lords Chamber

[Lord Macdonald of Tradeston (Lab)]

My Lords, I, too, thank the noble Baroness, Lady Bakewell, for initiating this debate.

A challenge of the BBC’s charter review is in predicting how quickly technology and viewing preferences will change between now and 2027. Remarkably, the BBC iPlayer recently had 343 million downloads by on-demand viewers in just one month. The BBC was, of course, an early investor in the digital revolution, funded by a generous licence fee settlement in the mid-1990s. Today, as we have heard, of the world’s top 100 websites only one is British: BBC Online. George Osborne criticised the BBC for being “imperial” in its online expansion but surely it is also our national champion in the internet age.

The BBC, as we have heard, declared recently that since it is owned by the public—the licence fee payers—their voice should be heard the loudest. I agree and, echoing my noble friend Lord Bragg, say that in the developing debate about the charter review, viewers should be made aware of how much of the annual fee that they pay for public service television is now diverted away from on-screen programming. The recent deal imposed on the BBC by the Government means that the cost of free television licences for the over-75s—some £650 million a year—must now be paid out of licence fee money. Similarly, in this charter period, licence fee money is being diverted to fund digital switchover, the rollout of broadband and, now, to fund local commercial television stations. These are all perhaps worthy causes, but why should it be to the detriment of what viewers are offered on-screen or on the radio as programme budgets are cut?

This is not to excuse any past profligacy or inefficiency at the BBC. The noble Lord, Lord Hall, has pledged to reduce the many layers of management; executive salaries and payments to presenters and performers are being squeezed. Much of the cost and complexity of the BBC bureaucracy comes from it trying to do too much in-house, thus creating uniquely demanding roles for its senior executives. Later this month, proposals will be set out on whether BBC Worldwide and BBC production should be kept in-house or outsourced, with production most likely to change its status.

There are other important questions. Will the present licence fee be replaced with a household levy, which is certainly worth serious consideration? Should the BBC Trust be abolished and its key responsibilities transferred to Ofcom, leaving the BBC controlled by a board of appointed, independent directors and senior BBC executives? I think that likely. What kind of BBC would this board preside over after the charter review? In his most recent contribution to the ongoing debate, the noble Lord, Lord Hall, proposed an,

“open BBC for the internet age”.

The Ideas Service would be an online partnership for collaboration with arts bodies, institutions, universities et cetera. A partnership with local newspapers is also proposed, with the BBC funding a pool of 100 public service reporters across the UK. That is certainly imaginative, but there is an urgent need for practical examples of how such partnerships will work, to persuade the many sceptics.

I hope we can encourage greater public involvement in a wide-ranging debate on the BBC charter review; to be followed in 2017 by an era of conspicuous austerity off-screen, better-funded programming on-screen and less interference from top-slicing Ministers.