Queen’s Speech

Lord Macdonald of Tradeston Excerpts

Thursday 19th May 2016 Lords Chamber

[Lord Macdonald of Tradeston (Lab)]

My Lords, I welcome this early opportunity to comment on the White Paper published last week, A BBC for the Future: A Broadcaster of Distinction. An 11-year term for the new BBC charter is in line with past practice of 10 years, with the extra year designed to delay partisan pressure until after the general election fixed for 2025. However, the proposed “health check” review of the BBC after just five years will inevitably be politicised and should be dropped. The uncertainty and disruption will distract management from the task of creating the broadcaster of distinction promised in the title of the White Paper, and anyway is it not Ofcom’s new role to do such so-called health checks?

The BBC should indeed try to be more distinctive and to occupy the high ground more often rather than churn out formulaic series, particularly in daytime schedules, that might sit just as easily on commercial channels. A former governor and chairman of the BBC, Gavyn Davies, said a few years back that BBC executives paid too much attention to ratings. With the licence fee to be inflation linked and extended to include on-demand iPlayers, and with the lucrative BBC Worldwide subsidiary secured and its subscription options being opened up, it seems reasonable that the BBC should be more mindful of its market impact on other media companies, which depend on ratings or readership for advertising revenue or on niche markets for sales or subscriptions.

Since the launch of Channel 4 in 1982, independent production has had a huge, positive impact on British television. The independent sector has a turnover close to £3 billion a year, with 259 companies making programmes for public service broadcasters. The BBC presently commissions 25% of its output from independent producers, which are also able to bid against in-house BBC competition across a further contestable 25%, with 50% of the programme output reserved for in-house BBC production. The White Paper proposes that by the end of the next 11-year charter period, all television output apart from news and news-related current affairs should be open to competition. This positive approach is related to another major White Paper proposal, to which the Government give their support in principle; namely, the creation of a new commercial subsidiary, BBC Studios, which will offer its production facilities on the open market and which, to ensure fairness and avoidance of conflict of interest, must be very closely monitored.

Devolving and outsourcing on this scale should allow the core BBC to reduce its layers of management and staff levels, especially in London. The devolution of programme-making to the three smaller nations of the UK now matches, or indeed sometimes exceeds, their proportion of licence fee payers—a considerable advance on past practice.

However, the fine-tuning of the commissioning process to ensure that programming from Scotland, Wales and Northern Ireland reflects the distinctive characteristics of each nation while enhancing the diversity of the BBC network schedules will be a very big creative challenge. Diversity is now to be enshrined in the new charter, to reflect the changing nature of the United Kingdom, in particular its growing numbers of black, Asian and minority-ethnic citizens, and to give more proportionate employment to those with disabilities and to the LGBT communities and of course better gender balance. A diversity unit will be based in Birmingham, alongside the English regions headquarters, local news partnerships, BBC Three online initiatives and the drama village at Selly Oak. All that will at least strengthen the BBC’s still meagre presence in the Midlands. Let us hope that after many previous failed initiatives, the diversity unit can now set hard targets, be underpinned by dedicated funding and have ready access to the centres of power in Broadcasting House.

The most controversial issue now in charter review is probably how best to ensure the independence of the new unitary board which replaces the BBC Trust. It is already decreed by the Government that the current chair of the trust will chair the unitary board, at least until the expiry of her present contract. The Government also intend to appoint the deputy chair and the non-executive “national” member for England. There are also non-executive directors from the three other nations of the United Kingdom, to be appointed through established protocols by the UK Government in consultation with the Government of Scotland and the Executives governing Wales and Northern Ireland—a delicate process, bearing in mind the need for these four “national” appointees to balance their representative role with a legal duty under the charter to serve the BBC as a whole. That adds up to six government appointees as non-executive directors.

Of course, the director-general will be on the board and, crucially, will be nominated as editor-in-chief and be an executive director. If the board has, as expected, 14 members, that would leave five further non-executives and two more executive directors to be appointed, as I read and understand it, by the BBC itself. Does that mean a board nominations committee will be set up by the chair, to include perhaps the deputy chair—also chosen by the Government of course—and the director-general? Will the Commissioner for Public Appointments be involved in the appointment process, to help ensure the promised independence from Government? Perhaps the Minister, in replying, can clarify that.

The appointment process obviously cannot involve Ofcom, which already has a board appointed by Government and would surely not want a role in appointing those it must then regulate. The new unitary BBC board will set strategy, deliver services, oversee operational delivery, measure performance and engage with the public—all important areas of governance, to be sure. For context, it may reassure noble Lords concerned about political interference to note the importance of the remit given to Ofcom in regulating the BBC: monitoring and reviewing performance; establishing a licensing regime; regulating editorial standards; holding the BBC to account; and acting as the appeal body. That is a daunting list, even for a super-regulator as well regarded as Ofcom. There is plenty of scope there too for regulatory clash if the BBC board overreaches its governance remit. I trust the Government will ensure that Ofcom has the resources to take on this very big job.

Through further clarification and debate in both Houses of Parliament, the potentially positive aspects of the White Paper could deliver the licence fee payers of Britain an even better BBC than the one they now support so strongly. I therefore join the noble Lord, Lord Hall, and the BBC in giving the White Paper a cautious welcome.