Broadcasting

Lord Watson of Wyre Forest Excerpts

Tuesday 18th October 2016 Commons Chamber

[Mr Tom Watson (West Bromwich East) (Lab)]

I refer the House to my entry in the Register of Members’ Financial Interests. I particularly draw Members’ attention to the fact that I have only recently stood down as vice-chair of the all-party group on the BBC.

May I say how much we are looking forward to working with the new Secretary of State and her team? She was generous and engaged in constructive dialogue when she was a Home Office Minister, and I hope that we can continue that relationship in our new posts. I also wish to thank my predecessors in this role, my hon. Friends the Members for Luton North (Kelvin Hopkins), who has shown that he has not lost his tenacity or his energy in this policy area, and for Garston and Halewood (Maria Eagle), who offered such robust scrutiny of the White Paper when it was discussed earlier in the year.

The Labour party welcomes the fact that the charter provides the BBC with the funding and security it needs as it prepares to enter its second century of broadcasting. The BBC embodies those enduring British values of hard work, creativity, innovation and co-operation. It helps to ensure that Britain’s voice is heard around the world, and it has informed and entertained countless millions of listeners, viewers and web users. It did so once again over the summer with its truly exceptional coverage of the Olympics in Rio, and I know that the whole House will agree that we should acknowledge that on the day we celebrate the achievements of our athletes by throwing a fantastic party in Trafalgar Square later.

While we welcome the charter, we have some misgivings, as the Secretary of State has seen, about the responsibilities that the BBC has been obliged to accept. In particular, we are extremely concerned about the Government’s decision to force the BBC to meet the cost of providing free TV licences to the over-75s. That was done without meaningful public consultation and little parliamentary debate, and it was part of a deal that was made behind closed doors.

[Kelvin Hopkins]

I congratulate my hon. Friend on his appointment as shadow Secretary of State; I am sure he will enjoy the job.

The imposition of the cost of licences for over-75s was carried out at the same time as the charter was being negotiated. Does that not imply that a degree of duress was involved in making the BBC accept that decision?

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[Mr Watson]

It is certainly not the most ideal of circumstances to face when negotiating for survival. We do not think that there was a meaningful public consultation and we had hoped that those days were behind us. We feel strongly that that situation cannot be allowed to happen again. This was the second time that the Government had approached their deliberations with the BBC by placing a gun to its head. In 2010, the coalition Government forced the BBC to take on the cost of paying for the World Service. The Government approached the negotiations in 2010 and 2015 with the subtlety of a ram raider approaching a jewellery shop. Their approach was described as a “smash and grab raid”.

We expect the Secretary of State to reassure us that the next licence fee settlement will be agreed in a transparent manner and according to a clear timetable. It must be subject to parliamentary scrutiny and put out to public consultation, so that whoever is in power cannot railroad a settlement through again. Please will the Secretary of State give a guarantee to the House that such a system will be put in place? We will work with her to achieve that.

I am sure that some people believe that asking the BBC to pay £700 million a year for free licences was clever politics, but I think it was political irresponsibility, verging on negligence. The BBC is not an arm of the Government. It should not be asked to meet the cost of Government policies and it should not be asked to implement changes to the Government’s social security policy.

[Karen Bradley]

It is worth putting on record that the BBC licence fee has been frozen for the last six years. The Government have agreed to increase the licence fee in line with inflation, which will result in additional income for the BBC of £18 billion in the period up to 2021. That is more than enough compensation for the money the hon. Gentleman is talking about. The issue of licences for over-75s was dealt with outside the charter arrangements. This is a fair settlement that gives the BBC good funding and the licence fee payer good value for money.

[Mr Watson]

It is certainly a settlement. The BBC has accepted it as a settlement, and that is why we will not oppose the motion, but it is not unreasonable for us to press the Secretary of State on why an instrument of social security policy is being passed to the BBC. We are considering carefully whether we can challenge the measure in the Digital Economy Public Bill Committee, because the extra cost imposed on the BBC is the equivalent of a 20% budget cut. I know the deal has been struck and different income streams have been negotiated within it, but the manner in which it has been done is distinctly unfair. The Government are passing responsibility for social security cuts that they should take on to a British institution.

[Ian C. Lucas]

Will my hon. Friend give way?

[Mr Watson]

Yes. I should point out that I have a bad ear infection and can hardly hear a thing today, so hon. Members will have to shout if they want my attention.

[Ian C. Lucas]

When my hon. Friend considers trying to amend the Digital Economy Bill, will he bear in mind that £630 million of public money was taken from the BBC to fund broadband in the previous Parliament? The Government have real form with raids on the BBC.

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[Mr Watson]

We will of course take on board my hon. Friend’s wise advice.

[Mr Edward Vaizey (Wantage) (Con)]

Will the hon. Gentleman give way?

[Mr Watson]

Hmm, yes.

[Mr Vaizey]

I am sorry to shout so dramatically, but I took on board what the hon. Gentleman said—I listen to every word he says—about his ear infection and I wanted to grab his attention. May I point out that the money from the BBC television licence fee that was used for broadband was actually the surplus left over from Labour’s highly successful digital switchover programme? That programme was so successful that it underspent its budget, and we used the surplus to pursue our own extremely successful broadband programme.

[Mr Watson]

I am being slightly diverted from the motion. I have only been in this role for 10 days, so I may not have my facts entirely right, but I think that the £630 million that my hon. Friend the Member for Wrexham (Ian C. Lucas) described has also been underspent to the tune of £60 million. It would be very useful if the Government could give that money back to the BBC so that it could be put into diverse broadcasting such as children’s broadcasting, in which the right hon. Gentleman and I both have an interest.

[Sammy Wilson (East Antrim) (DUP)]

Does the hon. Gentleman accept that in an age when all other public bodies are being asked to make efficiency savings, it is reasonable for the BBC to be asked to share some of the burden, especially given the fact that the BBC overspends on a lot of programme making? For example, it took twice the number of people to the Olympics than other broadcasters took? Salaries are still going up, the top echelons have not been reduced and huge pension settlements are still being given to those who leave the BBC.

[Mr Watson]

I hope that I have not given the hon. Gentleman the impression that I do not think viewers need value for money—they certainly do. The transparency measures agreed by both sides of the House have helped to ensure that the value-for-money case is made internally within the BBC.

[Kelvin Hopkins]

Hon. Members are eliding public spending, which is paid for by taxation, and licence fee spending, which might be seen as a relatively regressive form of taxation, but is not public funding in the same sense.

[Mr Watson]

My hon. Friend makes a very good point.

We will always make the case for a strong, independent and well-funded BBC. That was what we did in government and it is what we intend to do in opposition. I hope that we can move on from the days when a small group of campaigners routinely questioned whether the BBC should exist at all. For a handful of people, the licence fee that has funded the BBC for nearly a century is an aberration. They believe that the only reliable, durable and perpetual guarantor of independence is profit. Perhaps they believe that 40p a day is an outrageous price to pay for the BBC’s startling array of television and radio news coverage, current affairs programmes, natural history, drama, comedy and children’s programmes. Perhaps they would rather see the BBC smaller and a little duller. I do not believe that and the British public do not believe it either. That was why there were 192,000 responses to the Government’s consultation on the future of the BBC, and why the overwhelming majority were favourable and supportive.

I pay tribute to the campaigners whose tireless work helped to deliver a BBC charter that is likely to secure its future: the Great BBC campaign, founded by Lord Waheed-Alli and Charlie Parsons; the Save our BBC campaign; the 38 Degrees petition to protect our BBC, which now has over 390,000 signatures; and all the creative industry trade unions, including the Broadcasting, Entertainment, Cinematograph and Theatre Union, Equity, the Musicians’ Union, the National Union of Journalists and the Writers’ Guild of Great Britain. All came together in a coalition to defend the BBC. They raised awareness, generated support and helped to deliver those 192,000 responses to the Government’s consultation. On both sides of the House, we are indebted to them all.

[Nigel Huddleston (Mid Worcestershire) (Con)]

I agree completely that there was some very effective campaigning, but will the hon. Gentleman accept that there was also a lot of unnecessary scaremongering? For example, an accusation was sent to Government Members’ mailboxes about the wholesale destruction of the BBC by the Tories. That was never the intent and never the case, and some people need to apologise.

[Mr Watson]

I am afraid that I am not quite sure of the specific allegation of scaremongering, but the hon. Gentleman has made his point and it is on the record.

We welcome the royal charter and the security it gives the BBC. In particular, I welcome the Government’s U-turn, as the consultation on the future of the BBC that they published in July 2015 was very different in tone and intention to the proposals before us now. We welcome the fact that the BBC’s funding settlement will now be decided every 11 years; it is particularly helpful to remove it from the five-year election cycle.

We welcome the settlement, but we know that an institution the size of the BBC can never be perfect. We believe the BBC has a responsibility to look and sound like Britain, both on screen and off. It should do far more to identify, employ and promote talent from every background and every walk of life. That means recruiting far more people from our black, Asian and minority ethnic communities. It means more women of every age in senior roles off screen and in leading roles on screen. It also means employing people from every social background.

[Gloria De Piero (Ashfield) (Lab)]

Thinking about the pupils of Ashfield, I would like to make a practical suggestion. The BBC should go into schools in constituencies such as mine and tell pupils that work experience is open to them. Their parents pay the licence fee, so they should have the opportunity to work there.

[Mr Watson]

That is a fantastic idea. Perhaps we can build up a case to allow the BBC to extend its reach into schools in areas like my hon. Friend’s constituency.

[Mrs Helen Grant (Maidstone and The Weald) (Con)]

Does the hon. Gentleman also agree that in the light of Ofcom’s new diversity obligations, the make-up of the UK population should be better reflected in terms of personnel and senior management?

[Mr Watson]

That is a very insightful point about something that we can work together to monitor.

I was talking about employing people from every social background. The BBC has a duty to reflect the nation it serves. That means informing and entertaining licence fee payers, as is set out in the charter, but the BBC must also do more to encourage and support British talent regardless of ethnicity, gender, sexual orientation, disability or social background. It is well placed to do that because, almost uniquely, it has a strong and visible presence across the country. There are BBC studios in Birmingham, Bristol and Belfast. The BBC has offices in Leeds, Nottingham, Glasgow, Edinburgh, Cardiff and many more places too numerous to list. It has a duty to reach out to the communities on its doorstep.

The BBC has significantly expanded its apprenticeship programme. I commend director-general Tony Hall for that but, as my hon. Friend the Member for Ashfield (Gloria De Piero) points out, there is far more we can do. According to research carried out in 2015 by the Department for Culture, Media and Sport, over nine in 10 jobs in the creative economy are done by people in more advantaged socio-economic groups, compared with 66% of jobs in the wider economy. That has to change.

[Karen Bradley]

indicated assent.

[The Minister for Digital and Culture (Matt Hancock)]

indicated assent.

[Mr Watson]

Ministers are nodding in support of that, so I hope that they can reassure me that the new and explicit commitment to diversity will also cover social class. I grew up in an era when working class actors such as Michael Caine, Glenda Jackson and Julie Walters were giants of popular culture.

[Helen Goodman]

You’re not that old.

[Mr Watson]

I am; I am feeling it, anyway.

I have nothing against Benedict Cumberbatch and Eddie Redmayne—I admire their talent hugely and they are great ambassadors for our country—but we need more people like Julie Walters, Christopher Ecclestone and Paul McGann. And it should not fall to Lenny Henry and Idris Elba to be the face of the BBC’s diversity programme.

[Matt Hancock]

This is an appropriate point in the debate to underline the cross-party support for this direction of travel. The BBC knows that it has a lot more work to do. As the hon. Gentleman says, diversity is explicit in the charter, and that means diversity in all its forms: yes, protected characteristics such as ethnic background, gender and sexual orientation, but also social background—wherever people come from and from whatever walk of life.

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[Mr Watson]

I welcome the Minister’s reassurance about that. We will work constructively with the Government to make sure there is a framework so that the BBC can actually achieve its targets. As Andrew Rajan wrote only last week:

“there have been decades of lip-service being paid in praise of diversity by the various gatekeepers of finance and programming, but nothing has changed at all”.

The BBC has published its own national target, which commits it to hiring 15% of staff from black, Asian and minority ethnic groups by 2020, but I am afraid it has a poor record on this. In its evidence to the Puttnam inquiry, the Campaign for Broadcasting Equality said that despite the BBC’s many diversity initiatives and programmes, it has consistently failed to meet its own targets. This cannot continue, so I welcome the Minister’s commitment to making sure that that does not happen.

The people we see on screen, the people who create what we see on our screens and the people who lead television must look more like the people we see on our streets. That means seeking out talent, on screen and off, from the black and minority ethnic communities. It means ensuring that roles do not mysteriously disappear for older women and it means creating roles that do not automatically exclude candidates with disabilities or mental health issues. The charter’s new commitment to diversity is welcome and Ofcom’s role as the BBC’s new regulator will be vital. It will help to bring about a truly diverse BBC that reflects the nation it serves. The point the hon. Member for Maidstone and The Weald (Mrs Grant) makes is well taken. Will the Minister tell us how Ofcom will monitor and enforce its new diversity duty? Will it publish data about the number of BBC employees from minority groups? Will it monitor on-screen talent and publish information about where that is drawn from? Any detail that the Minister could provide today would be extremely helpful.

The charter introduces a host of other changes, some of which are more welcome than others. The National Audit Office already helps to ensure that the BBC delivers value for money to licence fee payers, so we have no objection in principle to extending its role so that it scrutinises the parts of the BBC that spend public money. We have some concerns, however, about the expansion of the NAO’s remit to cover parts of the BBC that are not directly funded by the licence fee, particularly BBC Worldwide. There might be a danger that allowing the NAO to access BBC Worldwide’s books could place it at a commercial disadvantage, so that risk will need to be addressed.

The charter attempts to resolve that possible problem by stating that the NAO cannot question any “creative or editorial judgements” on the grounds of value for money, but it also allows the NAO to define exactly what that phrase means. It will need to be defined more precisely in the charter in the future. Will the Minister be able to provide us with some comfort that it will not be interpreted too widely? An independent dispute resolution process needs to be established so that disagreements between the NAO and the BBC can be resolved.

We give cautious welcome to the proposal that Ofcom becomes the BBC’s regulator. I have already mentioned the critical role Ofcom will play in monitoring diversity, and it will also monitor distinctiveness and consult the industry on its new operating framework next year. Given the issues at stake, can the Minister confirm that Ofcom will also consult Parliament and the public about this matter? The BBC Trust struggled to reconcile its twin roles of the corporation’s regulator and its cheerleader. It is right that these two functions and responsibilities, which were often confusing and sometimes contradictory, are to be officially separated.

We welcome the fact that the majority of appointees to the BBC’s unitary board will now be drawn from the BBC, rather than being appointed by the Government. We note that that was not the Government’s original intention, but I commend them for performing a heel turn and pivot on that issue—Ed Balls would have been given a 10 from Len if he had managed to pull that off with such style. As Lord Foster of Bath said in the other place, the fact that the Government appoint the chair of the new BBC board and the chair of Ofcom raises questions about their independence. Does not the Secretary of State agree that one way of guaranteeing independence would be to require that every non-executive is independently appointed?

The new charter rewrites the BBC’s 90-year-old mission statement. The commitment to be “impartial and distinctive” has been added to the time-honoured duty to “inform, educate and entertain”. We need assurances from Ministers about that, because distinctiveness is poorly defined, and Ofcom has admitted that it is still working out exactly what it means. Distinctiveness is a vague notion, and there is a risk that the BBC’s commercial rivals could use it as a stick with which to beat the BBC whenever they wish.

Despite these reservations, I sense that this Secretary of State wants to create a new climate in which the future of the BBC can be discussed without political posturing. I do not think she wants to return to the days when David Cameron could describe the prospect of cuts to the nation’s favourite broadcaster as “delicious”. The new approach is welcome. As I said, I believe that the Secretary of State has the BBC’s best interests at heart. I can detect no desire on her part to use the BBC as a political football. I really hope those days are behind us. The aim of the charter settlement should be to give the BBC the space, time and resources it needs to adapt to huge technological change. That is the only way the BBC will remain relevant to a younger audience who are consuming content in myriad ways.

We will work with the Secretary of State to secure the future of the BBC. Let us hope that this is a new benign era for the Beeb. After all, when Government Ministers are loudly complaining about you in public; when Back-Bench Government MPs insist that you have an inbuilt left-wing bias; when Front-Bench Opposition MPs insist that you have an obvious right-wing bias; when the left-wing columnist, Owen Jones, says you are a threat to democracy; when the Foreign Secretary finds you infuriating; when politicians and activists of every stripe and persuasion think you are against them; when two thirds of the British public see you as a bastion of editorial excellence and journalistic integrity; and when the American public would rather get their news from you than from their own news sources, there is one thing the BBC can be sure of—it is doing things right. We should be proud of one of the nation’s greatest assets.

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[Mr Whittingdale]

I understand that, and there are particular regions—and indeed nations—that feel underserved and hard-done-by. In my view, the BBC made a good move in transferring a lot of its production and facilities to Salford—I was in favour of the establishment of the Media City in Salford—but that was not sufficient for the BBC to then sit back and say, “Right, we’ve done our bit for the English regions; we don’t have to worry any longer.” The west midlands has felt underserved, as has been debated in this House, and I have no doubt that the hon. Member for East Dunbartonshire (John Nicolson), speaking for the Scottish National party, will talk about the provision of the service, and indeed employment and production, in Scotland. This is a live issue, and I believe the BBC needs to do more.

I want to touch briefly on two particular policy developments that I promoted and remain keen on. The first is the public service content fund. The hon. Member for West Bromwich East (Mr Watson) talked about the underspend on the provision for broadband and what will happen to it. I hope it will go to establish the public service content fund, which will provide programming in areas that are currently underserved, of which children’s television is certainly an example. It will be administered outside the BBC.

[Mr Watson]

Does the right hon. Gentleman not think that there may be a chance with that development of an onerous bureaucracy being created that may cost the licence payer more, and may mean that the expertise in commissioning content is diminished?

[Mr Whittingdale]

I very much hope that there will not be additional bureaucracy. The precise way of administering it will need to be worked out. There is a valuable consequence of this: this is a very small pot of money, but it will mean that there is an alternative route—other than the BBC—for the obtaining of funding from the public purse for public service content. At present, the BBC has a monopoly in commissioning content with public money. That is in large part necessary, but it is worth exploring this alternative route.

[Mr Watson]

My memory is not great and I have only been reading into the brief for 10 days, but I think that the figure is about £60 million. Does the right hon. Gentleman envisage that being an ongoing demand on the BBC, or will it be a one-off pot as a result of the underspend?

[Mr Whittingdale]

Where the money is coming from has been identified: it is coming from the underspend, as the hon. Gentleman flagged up in his remarks, and that is obviously over a set period; it is not ongoing. We will judge the success of it. It will be to some extent for the BBC to decide whether it is a success, and also for the Government to decide, but I am content that, certainly for the next three years, it is in place.

The other innovation I am very committed to, and to which the director-general has given a lot of support, is the provision for the BBC to support local media through the establishment of local news reporting and the buying-in of content. The purpose of that is first to address an extremely serious issue: the decline of local media and the consequences of that for local accountability and democracy. This alone is not going to solve that as it is a very big issue, but it is a recognition that the BBC has taken content from local newspapers often without even attributing it to the local paper, let alone giving any money for it. This will ensure that local newspapers continue to cover local institutions—local councils, courts proceedings and so forth, which are extremely important for the functioning of local democracy. It seems to me a legitimate use of the licence fee to do this and I welcome the support the BBC has given to the move. It is important that the BBC should not directly employ these people: if it turned out that a local newspaper could reduce their employment even more because the BBC would pick up and employ those people, it would further harm local media rather than helping. The important thing is that, through a tendering process, the BBC establishes a relationship in each area with a local media organisation—it does not need to be a newspaper; it could be a radio or television station—and supports it in ensuring that there is proper coverage of local political issues. That is new, and I hope it will help to sustain local media and local democracy in this country.

Finally, I want to touch on the future of the licence fee. I think I have been quoted in the past as saying that the licence fee was worse than the poll tax. When I said that, it was simply an observation that the licence fee is a flat-rate charge payable by every household and, unlike the community charge, no help is available even for those on very low incomes. It was simply an observation of that. The licence fee has many flaws—it is regressive, it is hard to collect, and there is the iPlayer loophole enabling people to evade it, which we are now closing—but I think the Government are right that for this charter period the licence fee should continue. The speed of change in the way that people receive television is very fast and there may well come a moment when the technology has advanced so that the old argument that everybody consumes the BBC in one form or another is no longer true. Also, if television is distributed via the internet, which is coming and I believe will eventually be the universal method of distribution, that will be the moment when it is possible to experiment with things like conditional access subscriptions. I therefore welcome the fact that the BBC has agreed to put a small toe into the water and use the iPlayer perhaps to supply some additional content on a voluntary subscription basis. That is a small step, but it will shed light on our potentially one day moving towards a voluntary system of subscription to the BBC. The technology does not permit that now, and I do not think it is appropriate now, but I welcome the fact that the BBC has agreed to make that first small step.

I conclude by saying once again that I believe the draft agreement and charter represent a sound foundation for the future of the BBC. I would like to take some small credit, despite all those who told me I was hell-bent on destruction. That was not the case, and I hope this proves it.

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[John Nicolson]

The hon. Lady makes a good point. There is a bit of irony here, because I looked at the Daily Mail after the Select Committee came out in favour of a separate Scottish Six and it condemned the decentralisation of broadcasting on a front page that was itself devolved. The Daily Mail does not run the same front page in Scotland as in the rest of the UK because it knows that the news priorities are different.

[Mr Watson]

I am enjoying the hon. Gentleman’s contribution. I have not been party political about the Scottish six o’clock news and have never thought about it in detail—I am the new kid—but I am trying to understand whether his position has changed. When I was doing my homework, I found a question from him to the Secretary of State in a recent debate in which he said:

“Does the Secretary of State agree that the matter of a separate ‘Scottish Six’ is entirely the responsibility of the BBC”?—[Official Report, 15 September 2016; Vol. 614, c. 1060.]

The hon. Gentleman seems to contradict that in his speech this afternoon. Has his thinking changed?

[John Nicolson]

I am delighted to explain. In answer to my questions, both the former and current Secretaries of State said that, while agreeing that Scotland was under-served and accepting the BBC’s analysis that it is not trusted in Scotland, the job of news was to bring the nation together. I do not believe that it is. The job of the BBC is to report without fear or favour and to provide the best possible news for its viewers, rather than acting as a cheerleader for one constitutional settlement or another. The BBC should devolve as much as possible. I believe in the concept of a separate Scottish Six. Politicians should stand back and allow the BBC to decide the form and content of that programme—[Interruption.] If the hon. Member for South Leicestershire (Alberto Costa) wants to ask me a question, he is free to, but if he mumbles, I cannot hear him.