Examination of Witnesses (Questions 474
TUESDAY 5 MARCH 2002
Chairman: Thank you for coming to see
us as part of our inquiry. Your presence justifies and has become
a regular feature and we have always found your visits extremely
474. I found the advice and information that
you gave to the Standing Committee of the OFCOM Bill very helpful.
Thank you for that. What I really want to pursue in a few moments
is the whole question of your views regarding the BBC and its
relationship to OFCOM. Before I do that, I was just wondering
about this. I am looking at the wording: there is going to be
a Communications Consumer Panel, is there not, under the terms
of OFCOM? Could you say what actually prevents OFCOM from completely
ignoring the views of that panel? Does the panel have any teeth?
(Ms Bradley) That rather depends on the
way it is constructed. It seems to us that such a panel is essential
to ensure that OFCOM has available to it all of the special interests
which they need to hear which relate to consumer interests because
OFCOM has to take other interests on board as well. Taking that
as a given, we would wish there to be some review from time to
time as to the extent to which OFCOM had taken note of the advice
given by the Consumer Panel. That is not to say that we expect
that OFCOM will always do what the Consumer Panel recommends because
the argument for the panel implies necessarily that sometimes
the interests of consumers will not be the same as the broader
public interest, which OFCOM will be interested in fulfilling.
We would want to know why they have not taken on board that advice
and that should be a matter of public record and period review.
475. Have you had any feedback at all from either
the DTI or DCMS as to whether this will be part of the statutory
obligation of OFCOM enshrined in the Act?
(Ms Lennard) I think we have gathered that it is almost
certain that OFCOM will be under a general duty to give reasons
for its decisions. I think we would like a little more detail
than that and it would be very helpful if it also had a duty to
say publicly where it disagreed with any recommendations from
the Consumer Panel. So we think it is generally probably going
to go in the right direction but we obviously need to see the
476. Let me move away from that, if I may, to
an interesting area, which is the BBC. You have argued quite strongly,
I believe, that the BBC should come under the full auspices of
OFCOM and not just Tiers 1 and 2. Of course the BBC have now come
back with counter-arguments for the restructuring to some degree,
some would say a rather cosmetic restructuring, of the Board of
Governors as an argument against coming under full OFCOM control.
What is your reaction to the Gavyn Davies initiative?
(Ms Bradley) I would slightly rephrase what I think
they have done, which is that, by virtue of making the changes
that are now being proposed, they are accepting the logic of our
argument actually, because to a great extent what they have done
is create conditions within which the BBC can mirror very much
what will be happening under Tier 3 for those who are regulated
by OFCOM under Tier 3. By acknowledging that there is a need for
them to operate rather in line with other PSB broadcasters and
approach the provision of public service broadcasting in the same
way, I think they are fundamentally acknowledging the logic of
477. What are you saying? Are you saying that
because they acknowledge your arguments, they do not need to be
a part of OFCOM because in fact they have managed almost to make
the Governors independent of the BBC, or are you saying that,
by doing what they have done, they might as well come under OFCOM?
(Ms Bradley) I think by doing what they have done,
they have acknowledged there is a possibility that they will move
the whole way in future. They have made a significant shift in
that direction. It is our view that we would all be best served
at a future date, and the obvious date is Charter renewal, by
them coming under OFCOM fully at that point.
478. I have looked at what Mr Davies has done
and the line of questioning that Mr Fabricant is pursuing. Although
clearly his intentions are of the best, it strikes me that what
the Chairman is doing is weird. Basically the BBC is run, is it
not, by the Chairman and the Director General? What the Chairman
is saying to the Board of Governors is: "You, the Board of
Governors, are the people to whom the BBC is accountable and I,
as Chairman, am now telling you, the Board of Governors, who should
be the people in charge, how to exercise your responsibility."
It appears to be a very strange way of proceeding for the Board
of Governors to be told by their Chairman, who is in many ways
an executive chairman, how to run the accountability of the BBC.
(Ms Lennard) What we obviously do not know is to what
extent these proposals are the proposals from the Governors as
a whole and to what extent they accept the proposals or the extent
to which, as you say, they may have been told what to do. We feel
that in the interim period, particularly leading up to Charter
renewal, that these are quite immediate issues. If there is going
to be a bit of a separation which, Chairman, you described as
weird, there are some key questions which the Chairman of the
BBC and the Board of Governors need to address. Very briefly,
and we could expand on this in more detail in a note, for example:
what criteria will they be using to assess the success or failure
and how will those be set; will there be external input; what
action can they take if there is serious failure, because at the
moment the ITC has at its disposal the possibility of sanctions.
There is a bit of a difficulty perhaps with fining a public body
where some of the money may come from the licence fee, but nevertheless
the question needs to be addressed. Then there are the relevant
broadcasting councils which, it appears, will be given a more
central role in advising the Governors about performance and the
role of the DCMS, which we think could be clearer in actually
auditing the regulatory effectiveness of the Board of Governors
in what, we hope, is an interim period.
479. You were speaking about sanctions and whether
an appropriate sanction, given that, as you say, there is difficulty
in fining something that is funded by the licence payers, would
be saying to Governors that if there is going to be a sanction,
they do not get automatic knighthoods or honours. It is just a
thought. Under Tiers 1 and 2, which the BBC does fall under, there
is a whole question of economic success. The BBC has been heralding
the launch of BBC4 recently, the digital channel, and there is
going to be soon BBC3 as well. Do you think that would come under
Tiers 1 and 2 under the terms of the present White Paper?
(Ms Lennard) Do you mean in respect of the economic
success of the channel?