BBC Funding

Lord Bassam of Brighton Excerpts

Tuesday 25th January 2022 Lords Chamber

[Lord Bassam of Brighton (Lab)]

My Lords, in truth, we know that this Statement was about distraction—a vindictive distraction at that—away from the Prime Minister’s behaviour during lockdown, the Government’s unlawful VIP lane for Covid contracts and their continued refusal to deal with our country’s cost of living crisis.

The Secretary of State pleads that she is interested in the cost of living crisis; if she were, she would be telling the Prime Minister to reverse the cuts to universal credit, put a stop to the national insurance and tax hikes this April, back Labour’s VAT cut on fuel bills and follow the lead of the noble Lord, Lord Agnew, and raise the alarm about the £4 billion-worth of Covid-related fraud. Freezing the licence fee increase pales into insignificance when put alongside those issues.

Given the BBC’s stated desire to become a leaner outfit, and with the new ability of the corporation’s commercial arm to access more private finance, I can see why the Secretary of State believes there is a rationale for a freeze, but we do not necessarily agree, as it will have a significant impact on the BBC’s output. Surely, the Government’s discussions with the BBC should have been concluded before any decision or announcement was made. Secretary of State after Secretary of State has looked at alternatives to the licence fee and not managed to find a feasible solution. If there is one, we are, of course, happy to look at the detail, but why does this Secretary of State believe she will succeed where others have failed?

The Secretary of State has expressed unease that pensioners face punishment if they do not pay the licence fee, so she must be appalled to find out that it was her own Government who stopped subsidising free licences for the over-75s. She cited concerns about impartiality and groupthink, an area in which, in my view, the BBC is very self-aware—perhaps even more so than the Government. Both sides of our political divide often accuse the BBC of bias, which probably means that, on balance, it is getting things about right. During the current government crisis, it has seemed to us that ITV, Sky and Channel 4 have, if anything, been even more questioning of the Government’s credibility.

In general, the BBC is rightly viewed by most as a national treasure and an international icon, so perhaps the Minister can say why the Government are so determined to undermine it. You can almost set your watch by the Government’s constant threats to public service broadcasting. The knock-on impact of the freeze—a real-terms cut of some £285 million by the end of the settlement period—is likely to have a larger economic cost than what the BBC loses by way of income. As we saw at the height of the pandemic, reduced commissions put enormous strain on the production and creative ecosystem, which has been left far more fragile than it was pre-pandemic.

The fact is that the BBC acts to underpin our creative sector. It the Government start chipping away at its foundations, they will undermine the structure and fabric of our cultural institutions and a big part of what makes the cultural industries so profitable and popular internationally. At present, production costs are spiralling due to inflation and increased competition from other broadcasters. The BBC has already trimmed quite a lot of the fat behind the scenes, so the impact of further cuts is likely to be more obvious to viewers. Will the Minister speculate and tell us today where he thinks the cuts needed for the BBC to balance its books should come from?

To give the Minister credit, in recent debates he has defended the work of the BBC and the way it is funded. I appreciate that decisions on funding statements are taken at a higher pay grade by his superiors, but did the Minister know that they had been taken and that this announcement was due? Perhaps he can share with us today his feelings when he saw the tweet about the future of the BBC’s funding and the threatened end of the licence fee. The Treasury has indicated that it will not chase down the £4 billion fraudulently claimed from its coronavirus support schemes at the height of the pandemic, so why not reverse that—track down the money in order to properly fund the BBC and other services and reduce, or at least offset, the planned tax increases that will hit family budgets far harder than the licence fee ever could?

We need a stable and secure funding base for the BBC, a more co-operative and collegiate approach from the Secretary of State, and a proper plan in place to effectively review the BBC’s charter and address the long-term issues that the Secretary of State raised about the dynamic and fast-changing nature of the digital, media and communications sector, which contributes so much to this country, its national life and our economy. This Statement was about little of the above, and I am afraid that it was much more about the shambles that, hour by hour and day by day, this Government have descended into.

[Baroness Bonham-Carter of Yarnbury (LD)]

My Lords, the BBC is 100 this year—what a birthday present from the Secretary of State this is. What possible reason is there for this attack on an institution that is the backbone of our world-beating creative industries, doubling its money, so far as investment in our creative economy goes?

Does the Minister not agree that the effect of initial BBC spending multiplies as it ripples through the economy, from region to region and sector to sector? Does he agree that it is pivotal in supporting our creative industries through innovation, skills and training, which directly feed into the Government’s levelling-up agenda, making programmes across the country that boost local economies and utilise local skills? BBC investment over decades has helped to develop significant local creative hubs across the UK, not to mention a network of local radio and TV, ensuring that a spotlight is shone on important regional issues and essential local news.

Does the Minister agree that 43p a day, which is the cost of the licence fee, offers exceptional value to all audiences across the UK, supplying via television, radio and the internet British content that is universally available to everyone across the country? Cuts will affect everyone but especially those with only free-to-air TV and radio, who tend to be less well off and older. Does the Minister not also agree that the BBC has been a lifeline through the pandemic, providing both news that the public trusted and essential support, through Bitesize, for those home-schooling?

Does the Minister agree that the World Service and the programmes that it exports, which showcase this country’s creative talent, are central to promoting the UK around the world, and are the envy of the world? The BBC was described by our Prime Minister, when he was Foreign Secretary, as

“the single greatest and most effective ambassador for our culture and our values”.

The DCMS is not the department for social policy, as the noble Lord, Lord Bassam, has mentioned; there are more direct ways to help those who are trying to deal with the burden of inflation plus increased energy bills. So will the Minister please listen to the words of Richard Sharp, chair of the BBC and a member of his party:

“I believe that the case for a well-funded, modern and efficient national broadcaster has not diminished over the past decade, but grown”?


Have the Government assessed the impact of this funding freeze on the BBC? Given that 95% of BBC spend goes into content and its delivery—despite what the Daily Mail says—what would the Minister be happy to do without? What about an impact assessment of this decision on the UK creative economy as a whole? Finally, does he not agree that these decisions cannot continue to be made behind closed doors—we believe that there is disagreement within the Cabinet about the announcement—and that we need an independent licence fee commission?