Examination of Witness (Questions 80 -
99)
TUESDAY 23 NOVEMBER 1999
LORD GORDON
OF STRATHBLANE
Mrs Golding
80. Do you not think more thought could have
been given to the efficiency savings that could be made at the
BBC before any recommendation of a vast increase in the licence
was made?
(Lord Gordon) To be honest, I would take issue. I
do not think £4 this year and £3 next year is a vast
increase. I am worried however. Efficiency savings can sometimes
mean doing poor quality programmes. Let us be honest. Some of
the efficiency savings have resulted in the quality of the BBC
being poorer than it was ten years ago. The quality of ITV is
a lot poorer than it was ten years ago. That is a worry.
Chairman
81. Would you like to join this Committee?
(Lord Gordon) I think I am disbarred from that but
I do follow your proceedings with great interest.
Mrs Golding
82. I must say that many of my constituents
would say any increase was going to be too much. If you are living
on a very low income, and most of the people who get caught for
not paying the television licence are people living on very low
incomes, then it is very difficult for many people to find the
additional money.
(Lord Gordon) One of the things which emerged and
the Committee put it rather well, was that the BBC should not
be a surrogate Department of Social Security. The idea that the
BBC licence fee subsidises free licences or reduced licences for
people in certain types of accommodation is in my view nonsense.
That is the job of the Department of Social Security. It was encouraging,
and Gavyn Davies made the point to you on Thursday, that this
time around it is the Chancellor who is funding the fee licences
for pensioners. We regarded that as forbidden territory, rightly
or wrongly, because we did not think the Chancellor of the Exchequer
would welcome observations from us as to how he should spend his
money.
83. It is a case of balancing a budget when
you are on a very low income.
(Lord Gordon) I do understand that. Actually I find
it strange that in the basket of things which are taken into account,
my understanding is, believe it or not, the television licence
is not one of them. It counts as part of the inflation package
that inflates the basket of groceries which determines whether
you get benefit or not, but it was not part of the original ones.
That is daft in my view.
Derek Wyatt
84. May I ask you about the taxation with the
over-75s? Do you take it as read that within a couple of years
the over-65s will say this is an unreasonable process because
they are all old age pensioners and that inevitably there is going
to be a discussion about free licences for old age pensioners.
If I have done my maths right that is £900 million from the
Chancellor of the Exchequer.
(Lord Gordon) Yes, it is a biggie.
85. That actually negates the whole purpose
of the licence fee.
(Lord Gordon) I would accept that and that is why
perhaps the reason the Chairman got so many complaints from constituents
is that if the Government allow one exemption clearly everyone
else says "Why not me?" as well. Therefore you get a
disproportionate number of people expressing dissatisfaction with
the licence fee. This is something the Chancellor will have to
hold the line on. That is his problem.
86. On digital television, so far BBC has not
exactly been successful. Do you think there is a problem in the
longer term that the more digital channels it opens, the less
people get enthused about the BBC, the less they will want to
pay their licence fee?
(Lord Gordon) Perhaps maybe with the benefit of hindsight,
but I would refer the Committee to the speech of Lord Hussey,
the former Chairman of the BBC in the Lords' debate on broadcasting
where he argued that the BBC should be concentrating on doing
its core things better rather than spreading and perhaps not doing
them as well. The man in the street would find the licence fee
distinctly more acceptable had the BBC retained some of its sporting
broadcasts rather than put money into digital experiments.
87. There is a change going on in the way in
which entertainment is delivered. We are not sure quite which
way the convergence will go but the Internet is clearly a major
player. The trouble is though that if you are at home, especially
a poor home, (a) you cannot afford it and (b) you do not get the
access. If we are to deliver that, is there something wrong if
the Government say, we have a licence fee, why do we not allow
that to be used for free Internet access at home?
(Lord Gordon) To be honest, I have not thought that
through sufficiently and I think any reply I gave would be glib
rather than well thought out, so I should like to duck the question.
Mr Keen
88. You just said you thought the BBC should
stick to its core programmes. Does that not contradict what you
said about BBC News 24 because if you asked the public, the thing
they would be most happy about with BBC would be the production
of news from the BBC. They tend to trust the BBC. Is that not
a contradiction?
(Lord Gordon) Sorry. The production of news, yes,
but not News 24. The Chairman alluded to 0.1 percentage audience
share and that is the difference. BBC news is highly important.
The BBC without its news would not qualify as a public service.
BBC news is vitally important. I just question whether it was
necessary for the BBC to move into 24-hour news before the Government
had examined whether any other provider could, with suitable regulation,
ensure the provision of public service news over 24 hours.
89. Why is such a small percentage watching
BBC News 24?
(Lord Gordon) For a start the number of people with
digital is fairly small. Unlike the Chairman last week who thought
that the commercial sector were discounting set boxes because
they were winning because they were able to offer BBC for nothing,
the honest truth—and it is a regrettable truth—is
that people are not switching to digital to watch the BBC programmes,
they are switching to digital to watch the other programmes. That
is why I do regard it as unfair on the commercial sector, with
which I have no connection on the television side, that they are
having to discount set-top boxes to attract people onto digital
where it is their services people are wanting to watch, I am afraid,
not the BBC's.
90. The real reason why not many people watch
it is because it is pretty new. The reason why not many people
watch Sky News is because not many people have the ability to
get hold of Sky unless they pay a lot of money for it. Do you
not think that if it is one of the BBC's core services they should
have been prepared therefore to provide that service so that when
people begin to access some more, when people start to be able
to access what they want, surely we should want BBC to be there
providing it which they are now doing? Take the commercial TV
companies, they do not want to provide news, that is why they
have shifted News at Ten back to 11.30 because they do not really
want news.
(Lord Gordon) The ITV companies must defend their
own decision about News at Ten but to say that they do not want
news would be untrue. The ITV companies with their regional coverage
probably offer more distinctive regional coverage than BBC does.
News properly provided is a premium product. I am wildly out of
date and you must ask ITV, but I strongly suspect that News at
Ten attracted premium advertising rates. I do not know what the
situation is now, but certainly news is the hook that persuades
people sometimes to watch television and listen to radio in the
first place. They want to know that they are not the sole survivors
of world war three when they wake up in the morning.
Miss Kirkbride
91. Listening to what you have said in evidence
to the Committee this morning, I certainly feel a certain amount
of confusion as to why it is that you are proposing a blanket,
relatively modest but nevertheless blanket increase in the licence
fee when you seem to be somewhat critical of the services already
being provided by the BBC. I wondered how you could justify going
ahead with that.
(Lord Gordon) For a start, until the very last moment,
one was trying to get the support of colleagues in the Committee
so that my view would have prevailed rather than theirs. That
is perfectly justifiable. I would be prepared to go as far as
£5 to £7 which is what I have said in my note of dissent.
My justification for that is that anything which is dependent
on RPI alone starts after a period of time to leave people a bit
behind and that might be true of the BBC. I am prepared to give
them the benefit of the doubt on that. There is a danger of quality
being further diminished if they are not given a bit of elbow
room and £5 to £7 will not cause too much public outrage.
92. Even when you personally would be in favour
of advertising on Online. That is an obvious way they could raise
money that they are not doing at the moment.
(Lord Gordon) We do not know how much money they would
raise by it but they would raise some. I likewise think that some
digital services will not be core generalist public service, they
will be niche markets which the BBC might be very well equipped
to provide. For example, it is perhaps the duty of the BBC to
cover the Open Championship on its general services, but if I
want to follow Colin Montgomerie dawn to dusk on a niche digital
service, which the BBC could provide, I would see no objection
to subscribing for that. You could have a mixture.
93. But you are still arguing for an increase
in the licence fee when the BBC are doing services which you seem
to be critical of. I find that a little surprising. Exactly what
will this increase in the licence fee pay for in your view?
(Lord Gordon) It will pay for better programming on
BBC terrestrial television.
94. Not for digital at all?
(Lord Gordon) No, better programming on terrestrial.
It is the core BBC services which the vast majority of the public
judge the BBC by. I should like to see more resources going into
it. Some of the shows on BBC are by no means public service. The
ill-fated Vanessa programme? People must be joking.
Chairman
95. Why do you think that if they have lots
of digital programmes they will not give us more rubbish like
that rather than these high-minded programmes which they have
the opportunity of providing now?
(Lord Gordon) I am not arguing that they should have
a lot more digital programmes. I am arguing that before the BBC
introduce any more services, they pass the two thresholds I described
earlier. I will not repeat them but I am saying that the BBC should
be constrained from further development before it passes the tests
I set out.
Mr Faber
96. I asked Gavyn Davies last week about a line
in the Report which says, "We decided that we may not be
able to offer a tight new definition of public service broadcasting.
We nevertheless each felt that we knew it when we saw it".
He said it was about the only flippant line in the whole Report.
Do you know public service broadcasting when you see it? Can you
enlighten us a bit as to what the other members of the Committee
felt justified public service broadcasting?
(Lord Gordon) The rest of the Committee must obviously
speak for themselves. I was reluctant with any definition which
said public service broadcasting is what the commercial sector
will not do, first of all because I thought that could be unfair
to the commercial sector and it would also leave the BBC with
a very narrow remit indeed. If you go back to the White Paper
of 1978 this set out the obligations in the BBC's letter to the
then Home Secretary and the regulations of the then Independent
Broadcasting Act. They are absolutely identical. It is the old
"inform, educate and entertain". I agree that this is
highly subjective and not only that, I further agree that it is
elitist, but I am actually prepared to defend being both. At the
end of the day our entire educational system depends on believing
that some things are better than others and that we should teach
children those things. I see nothing wrong with us doing that
in broadcasting as well. Public service broadcasting must also
obviously put the listener or viewer first. Again this sounds
arrogant and elitist but I think it involves inviting them to
stretch a little and not just give them exactly what they want
but try to elevate taste slightly. Elevating taste is probably
hopelessly politically incorrect but it is what I feel about broadcasting.
Chairman: You just made a wonderful statement.
Another Scottish peer, Lord Reith, started it.
Mr Faber
97. May I ask you about take-up of digital?
Am I right in thinking that what you said to us this morning,
when you implied that the added incentive to take up the premium
channels is because of the choice of the channels, that the breadth
of choice is the single biggest thing that will encourage people
to take up new digital?
(Lord Gordon) Probably, or the availability of something
they can only get on either digital or satellite and they are
probably thinking this digital thing is coming anyway so they
might as well go the whole hog and go digital. My household is
terrestrial only at the moment. We are seriously considering what
we are going to do and I have remitted it to my children to take
the decision.
98. You say also in your paper to us that the
main recommendation you disagree with about the digital supplement
is that it will deter or defer digital take-up.
(Lord Gordon) Yes.
99. So you would agree with the existing providers
that cost is the single most important thing in the decision,
the biggest deterrent.
(Lord Gordon) I have only glanced at the Nera Report
to be honest, I have not read it in full and I am not sure I would
believe it entirely if I did read it in full. To some extent the
evidence of people discounting the cost of set-top boxes does
suggest to me that if they are foregoing something out of their
own pockets, they must believe that there is a degree of price
sensitivity. Certainly, if I see an offer to go digital now and
pay £24 a year or wait three years and only pay £18
a year extra, I think I might put up with it for another three
years. It is certainly going to defer it and it may well deter
it.
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