Examination of witnesses (Questions 80
- 99)
THURSDAY 13 JULY 2000
SIR CHRISTOPHER
BLAND, DAME
PAULINE NEVILLE-JONES,
MR GREG
DYKE, MR
MARK THOMPSON
and MR JOHN
SMITH
80. What about the things that have hit the
headlines and caused upset both with the public and with your
own staff which is one of the management perks, which meant that
senior managers—I am not quite sure how senior they have
to be to have this—but certainly at some level of management
you would have your own chauffeur driven car and you would have
your own private car at home. Has that been put a stop to or is
that still available under the licence fee?
(Sir Christopher Bland) Yes. To make it clear that
all radical change is not our new Director General, that was stopped
by the Governors about a year ago. It was an odd decision. It
is the one area where the BBC, in paying its senior management,
was ahead of the game. In almost every other area we are behind
in terms of bonus level, long term incentive plans and so on.
We were ahead but it just did not feel right in a public service
organisation.
81. Nobody has it now?
(Sir Christopher Bland) I did not say that because
contractually those who have it are entitled to retain it and
that is still there. Any new appointee at that level does not
get two cars. Some people are being encouraged financially to
give up their second car. Are one or two taking advantage of that?
(Mr Smith) I am.
82. How many people are left in this fortunate
position of having a chauffeur and a private car?
(Mr Dyke) I do not have a private car.
(Sir Christopher Bland) Greg was a victim of our new
policy.
(Mr Dyke) We will halve the number of chauffeurs inside
the BBC within the six month period that we are looking at.
83. Halve the number of people who have had
the entitlement?
(Mr Dyke) Who have drivers.
(Sir Christopher Bland) No new entitlements exist
for two cars.
84. Most of the old ones stay?
(Sir Christopher Bland) Yes.
(Mr Dyke) If you are the Director of Nations and Regions,
which is the job Mark used to do, you need a chauffeur driven
car because you spend your life on the road. It would be counter
productive not to. No new directors on appointment get a chauffeur
driven car at all. Some have given them up. We will have reduced
the number of chauffeur driven cars at the BBC by half by the
end of this year from when we started.
85. Sir Christopher, you did say that part of
the interest about salaries and perks in the BBC is because you
are public sector. I am all for people being paid the going rate
for the job. On the other hand, as an MP myself, I do understand
that we are hide bound somewhat by working in the public sector.
Therefore, I expect similar reticence from the BBC. Would you
like to justify Lord Birt's salary when he was at the BBC, because
that seems rather high to me when compared to any other job in
the public service?
(Sir Christopher Bland) It would do if you compared
it with the public sector but, as you pointed out earlier, we
are a hybrid. We are a public service organisation benefiting
from the privilege of the licence fee, but competing in domestic
and international markets, both for talent within the organisation
in management terms and talent on screen. By those standards,
quite frankly, the last Director General and this one I would
say are paid about 50 per cent of the going rate for what is one
of the most difficult jobs in broadcasting in the world. We have
got it about right, but the idea that Greg is overpaid or John
is overpaid for this particular job is not right.
Chairman
86. If you look at page 29 of the report, the
statistics there puzzle me a great deal. We have Mr Dyke on £142,000
a year and immediately below him we have Sir John Birt on £276,000.
Was Sir John worth twice what Mr Dyke is worth?
(Sir Christopher Bland) No. I would not wish to compare
the merits of the two, but the confusion arises because our present
Director General was only employed for part of the financial year
that we are reporting on. He came in at an identical salary to
John Birt.
87. I would be interested to know about this
because the figures that attach to Sir John Birt are pretty astounding,
are they not? If you add his salary of £276,000, his annual
bonus of £159,000, his benefits of £21,000 and his termination
payment of £328,400, we are arriving at £784,400 for
Sir John Birt. That is an extraordinary sum of money.
(Sir Christopher Bland) If you add those figures up,
you are adding an apple to an orange and a grape.
88. It is all money, is it not?
(Sir Christopher Bland) It is indeed all money, but
you need, as I am sure you will know, to treat figures with caution
and understand the periods of time to which they relate. Sir John
was employed during the year. He was paid, shown in these accounts,
the bonus for the previous year, which is standard accounting
practice, but, because he left before the end of the year, his
bonus for 1999-2000 is also shown. That inflates that figure and
his termination payment, which again is a matter of record, was
separate from that.
89. It is all a matter of record and you are
very clear and open about the record but Sir John Birt got more
than three quarters of a million pounds. So that we have it on
the record, what was his salary and what is Mr Dyke's salary?
(Mr Dyke) My salary, as I understand it, is £340,000
a year.
(Sir Christopher Bland) On top of that there is a
bonus potential of 30 per cent.
Miss Kirkbride
90. What is the bonus based on? What do you
have to do to get your bonus?
(Sir Christopher Bland) Achieve the targets that we
have set the BBC during the year.
91. All of them?
(Sir Christopher Bland) To get 100 per cent of his
bonus entitlement, yes.
92. Are you getting your 30 per cent?
(Sir Christopher Bland) He still has a year to go.
This is his first proper year as Director General. He will if
he achieves his targets and he will not if he does not. On the
whole, the BBC has paid between 50 and 60 per cent of total bonus
entitlement, which seems about right. We are pretty critical about
people's performance levels and the payment of those bonuses.
Chairman
93. Retirement pensions have just got an increase
of 75 pence and we see Sir John Birt getting three quarters of
a million pounds of the licence money that those retirement pensioners
have to pay, and which they are prosecuted for if they do not
pay.
(Sir Christopher Bland) We operate in international
markets, as you well know. We are not simply a public service
broadcaster but a business. It is my belief that the present Director
General and the last Director General were far from overpaid for
doing this job. It is an incredibly demanding job. It is in the
public gaze. It involves a mixture of commercial and competitive
responsibilities, plus a public obligation. Everything is done
under the spotlight of publicity. It involves such things as coming
before this Select Committee. It has a range of requirements that
I think is unmatched in any other public sector job in the United
Kingdom. It is a really tough job.
Miss Kirkbride
94. I am not sure the Prime Minister would agree,
but go on.
(Sir Christopher Bland) I would not argue but that
is a separate issue. That is for the House of Commons to decide.
95. Can we have Sir John Birt's basic salary?
(Sir Christopher Bland) The same.
96. On the subject of changeover from BBC 1
to BBC 2, in that you might make some changes by putting your
more serious programmes on BBC 2, what do you say to them? Many
people I have spoken to feel this is just to ghetto-ise serious
programmes on BBC 2 in a bid to change the ratings on BBC 1.
(Sir Christopher Bland) That response illustrates
what happens when you begin a debate. The immediate assumption
is that you have already made up your mind and pejorative adjectives
like "ghetto-ise" or "dumbing down" fly about.
It is better to have the debate openly and to discuss these issues,
but perhaps I could ask Mark to elaborate on exactly what it is
that we are considering and why that is not ghetto-ising and ask
Greg to comment after Mark.
(Mr Thompson) I certainly did not suggest in my speech
at Banff that serious programmes, or even all serious programmes,
would move from BBC 1 to BBC 2. I suggested that over time—and
we are talking about a long, transitional period where some people
will be exploring new, interactive forms of television on their
EPGs in digital households while next door people are watching
television in a much more traditional way—we would have
to embark on a journey to make sure that our television channels
were still relevant in the future. I felt we needed to begin the
journey soon, though I would absolutely say it would be a journey
which, especially in the context of our main channels, BBC 1 and
BBC 2, would take many years. I do not believe however that we
should shift all serious programmes from BBC 1 to BBC 2. I have
not arrived at firm proposals yet. They certainly have not been
presented to the Governors. I believe there is a strong case,
to give you one example, for strengthening national and regional
news and current affairs on BBC 1. There is an argument for taking
our regional and current affairs programmes which are currently
on BBC 2 and placing them on BBC 1. I think there is an argument
for taking the rather short regional news bulletin which appears
after our current main evening news and extending it on BBC 1.
97. What about Panorama?
(Mr Thompson) As I said, we have not yet come to a
firm set of proposals. For that reason, I do not think it is appropriate
yet to talk about individual programmes. If you ask me do I believe
that current affairs, political debate, news, regional news all
should have a place on BBC 1, I absolutely believe they should
in the future.
98. Has not the debate always been in television
that you build audiences for programmes which are not as popular
by putting popular ones before them? You build audiences in that
way because people are not too promiscuous in switching channels.
They are becoming more so. There are a lot of people who sit there
and watch what comes on next. If you do segment it all into two
separate channels, you will create a high brow channel which some
people will watch but it is unlikely that as many people will
watch as they do then. I would like to see you make the same point
for your Panorama style programmes as you have for your news programmes.
(Sir Christopher Bland) You are right. You highlight
the dilemma which is that the Reithian hammock has been a way
of attracting people to programmes that they might not otherwise
have watched, particularly on BBC 1, but across the board. The
strings of that hammock have been cut and in digital homes people
no longer watch like that. We would extend an invitation to your
Committee, if you could spare the time, to take a look at a presentation
that we have on the differing viewing patterns in digital homes
as compared with analogue. It is very marked. The BBC's dilemma
is that at the moment, as you will know, Mr Chairman, because
you are digitally enhanced, if you press the children's button
the Sky programme guide, you see an array of children's programmes
and it does not include the BBC. That is odd because we are the
biggest producer of programmes for children in Europe and yet
we are not there. Sport is the same. If you turn to sport, the
BBC is not there because we are presenting a mixed channel, BBC
1 and BBC 2. That is a dilemma. How you respond to that in digital
homes is the question. As both Mark and Greg have emphasised,
how you do that, while at the same time recognising that your
analogue audience will continue to watch programmes broadly in
the same way as they always have, is the dilemma. We do not know
the answer to these questions yet, but it would be a real mistake
and a strategic error of the first order if the BBC were not to
start addressing these issues now. We would welcome the chance
of having a discussion about some of these issues against the
background of these technological changes and the differing ways
people in digital homes are watching television; what will be
the impact not just of the Sky guide but the TIVO box and its
competitors that will be on the market this autumn and will enable
you to self-schedule and download a whole week's viewing, to programme
a machine to pick out the programmes that you want to watch. They
are major changes and the BBC needs to be on top of these.
(Mr Dyke) I was at Caversham last week where the BBC
archivists live. I had a really interesting discussion with the
woman who runs it all who said that, at every stage in its history,
the BBC has been accused of dumbing down. The "dumbing down"
phrase is a recent phrase. Reith certainly accused Cardinal Green
of trivialisation and populisation of the BBC. The genius of the
BBC, it seems to me, has been the ability to change as the world
outside has changed. One of the things I discovered there was
a wonderful quote from Wilfrid Bramble who had just got the part
as the father in Steptoe and Son, who was saying quite clearly,
"I suppose we all have to do rubbish at some stage in our
lives." 30 years later, we hold up Steptoe and Son as transforming
television, almost the invention of the situation comedy. At every
stage in its development, every time it has changed, the BBC has
been accused of dumbing down. There is a real danger that you
see change as damaging or trivialising; whereas actually I would
argue that not to change is an even more damaging path.
(Mr Thompson) The Chairman mentioned Radio 4, I think
rightly, as in some way, despite our other radio stations, embodying
the spirit of BBC Radio. In 1967, when the Home Service was replaced
by Radio 4, it was regarded as an absolute scandal and a complete
resiling away from the spirit of public service.
Mr Fearn
99. Could I go back to the question of salaries
and bonuses? I well remember when Sir John Birt came into the
job and there were job losses. Is it not a fact that anybody moving
into a job slims down slightly I suppose, but is that not a way
of achieving the bonus, by getting rid of jobs, in this case,
1,000 jobs? Having spoken to a lot of people in the BBC, they
are waiting for the axe to fall which is a dreadful thing for
family people. Here we have over 1,000 jobs gone, on top of what
went before. That is an easy way to achieve targets and bonuses,
is it not?
(Sir Christopher Bland) I do not think I would agree
it is easy. As Greg said, it is the reverse. It is extremely disagreeable
and I do not admire anybody in any industry, and I have never
been somebody, who regards this as other than a really significant
decision. If you have been on the receiving end of a pink slip—and
I have in my day—it is an extremely unattractive and difficult
process. Greg is as well aware of that as any man I know. I do
not think we take it as the easy way out. I think it is not the
only part but it is rightly the major part of our drive to achieve
savings. If we did not do that, what would be the long term future
of the BBC? I think it would be less good, less secure, and the
existing jobs, the jobs that survive, would be less secure than
if we sat on our hands and did nothing. We do not pretend that
it is the easy way out. I do not think it is. There are few industries
and no one in broadcasting which have not reduced staff over time.
The BBC, six or seven years ago, had over 30,000 employees and
that has reduced by over 6,000 during that period. That process
is continuing. It is a painful process and it would be a brave
man in any industry who said it is going to stop there.
(Dame Neville-Jones) It seems to me that some of the
job losses are related to systemic changes in the BBC which preceded
the present Director General. There is a considerable systems
upgrade going on, turning over from manual to electronic systems.
That accounts for part of the pattern of change in employment
and reduction in numbers. I would not want it to be thought that
somehow the bonus is set by whether he can axe people or not.
There are an awful lot of other targets that Greg has to hit to
qualify for the bonus which relate to the quality of the programming
and what the BBC looks like from the point of view of the viewer,
apart from value for money and efficient management.
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