BBC Charter

Lord Best Excerpts

Wednesday 12th October 2016 Lords Chamber

[Lord Best (CB)]

My Lords, I speak as chair of your Lordships’ Select Committee on Communications. The committee spent nine months on its inquiry into the BBC’s charter, publishing its report, Reith not Revolution, earlier this year. We had decided against investigating new governance and regulatory arrangements for the BBC because others were doing so, so I have nothing to share with your Lordships on those important matters. Instead, we looked at the fundamentals: the purposes of the BBC, its scale and scope, the process for its funding and the period over which the charter should run.

Broadly, although we heard calls for radical changes to the nature and role of the organisation and the way it could raise its income, we concluded that there should be no such dramatic alterations to the BBC’s overarching purposes or its scale and scope; that funding by means of a licence fee should be maintained; and that the new charter should last for a full 11 years this time, to provide continuity and freedom from government influence as well as to avoid the hazards of the electoral cycle.

In the event, the Government accepted this case, taking on board some modest tweaks to the current processes, and the significant changes in the draft charter concentrate on governance and regulatory measures. This is clearly a happy outcome from the committee’s perspective, and it accords with the evidence that we received and the public’s strongly expressed opinion on the subject.

My anxiety when reading the White Paper and before seeing the draft charter was that the new settlement might be effective only for five years, not 11, because it could be up-ended by the planned mid-term review. This exercise, I feared, could be an unwelcome opportunity to reopen Pandora’s box and revisit all the issues around purpose, scale and scope which the committee hoped had been put to bed for a good decade. I raised this worry with Ministers on several occasions and requested that the charter make plain that the interim review should be confined to looking at the new regulatory and governance arrangements. It is therefore good to see these limitations on the scope of the interim review explicitly spelled out in the draft charter in just the terms that I know your Lordships’ Communications Committee would wish. I thank the Ministers for this section in the draft charter.

However, a nagging doubt remains. It concerns the basis for deciding on the BBC’s funding settlement. The licence fee system is, quite rightly in the committee’s view, set to continue, with the extension to cover the new ways in which the BBC’s output is accessed online. However, our report stressed the unsatisfactory way in which the licence fee was set last time around: a deal done behind locked doors with no public consultation and transparency. Many noble Lords have tonight criticised this clandestine—some have said scandalous—process. Now the draft charter suggests that in 2022 government will decide on the funding settlement—that is, the level and scope of the licence fee—but it is silent on any wider consultation about it.

Because the BBC is, of course, entirely dependent on the level of funding it receives from the public, the Government’s unfettered ability to decide on the licence fee is of the greatest significance. If there is the possibility of major changes in five years’ time entirely at the discretion of the Secretary of State then the sword of Damocles referred to by the Minister will still constantly hang over the BBC’s management. This power over the purse gives the Government a commanding influence over the BBC, not directly through the charter but outside it.

Our committee saw an important role for the independent regulator, Ofcom, in making a recommendation on the level of the licence fee based on proper evidence. Although the Secretary of State could reject that advice from Ofcom, we stressed that if they did so they should explain their reasons.

We also strongly recommend public engagement in that decision to moderate what could otherwise be a constant threat to the BBC’s independence. Your Lordships’ committee would certainly be strongly opposed to another behind-the-scenes deal, perhaps accepted by the BBC under duress. Surely the lesson from the major rows last time, including the controversy over the cost of free TV licences for the over-75s, was that a transparent process and public discussion on this issue is essential. Licence fee payers should surely have a voice in what they must pay. Can the Minister give some reassurance that the five-year review of the licence fee, like the 11-year review of the charter itself, will be subject to proper openness, public consultation and—I suggest—consideration by both Houses of Parliament?