Annex B
THE BBC AND OFCOM
INTRODUCTION: EXISTING
REGULATORY FRAMEWORK
1. The existing regulatory framework for the BBC's
public service role is quite distinct. It flows from the way in
which the BBC is constituted. Within the framework provided by
the Charter and the Agreement with the Secretary of State for
Culture, Media and Sport the Governors are responsible for ensuring
that the BBC meets all its statutory and other obligations. Charter
renewal (next due in 2006) offers the opportunity for Parliament
to review the working of the BBC. The Agreement between the Secretary
of State and the BBC sets out a detailed remit, the closest equivalent
to a licence. It does not, however, include detailed content requirements
for broadcasting of so many hours of news, drama etc. (The BBC's
commercial services which are licensed by the ITC are fully regulated
and subject to the same measures as the services provided by other
commercial broadcasters.)
2. Some elements of the present BBC system are subject
to external regulation. This includes some statutory regulation:
for example, the BBC is subject to the complaints procedures operated
by the Broadcasting Standards Commission. The Secretary of State's
power to approve and review the operation of new services and
for material changes to existing services, also provides external
regulation. The publication of the criteria and direct consultation
by the Secretary of State have recently made the approvals process
more transparent.
3. Other public service broadcasters (providers of
Channels 3, 4, and 5) are regulated through conditions imposed
in their licences by an independent regulator, currently the Independent
Television Commission. Particular conditions are agreed with each
licensee upon the award of the relevant licence and licensees
are then are then subject to ongoing monitoring and enforcement
by the regulator.
THE WHITE
PAPER: THE
3-TIER SYSTEM
OF REGULATION
& ITS APPLICATION
TO THE
BBC
4. The White Paper describes a new system of regulation
which is to be generally deregulatory and, in the interests of
fairness, will apply across the board. There will remain some
differences in regulation between the BBC and others, reflecting
the differences in the way they are established.
5. It is an integral part of the new system to extend
the involvement of the external regulator in the BBC, while increasing
the self-regulation of all other broadcasters. The purposes of
the BBC remain different from other broadcasters and so the form
and extent of self-regulation will differ, and we will retain
the core responsibilities of BBC Governors. These will include
upholding and protecting the BBC's political and editorial independence
and calling management to account.
6. The role of the Governors internally will be unchanged,
but the BBC will in addition be subject to new external requirements
policed by OFCOM. Broadly speaking the BBC will be subject to
the same degree of external standard setting and monitoring as
all other public service broadcasters for each of the three tiers
regulated by OFCOM. In addition the introduction of self regulatory
measures for commercial broadcasters (eg requiring them to review
their own performance) will also help create a common framework
for all broadcasters. For both the BBC and other broadcasters
broadly the same balance of self-regulation and external regulation
will be struck. The overall result will be that the BBC will be
subject to greater external regulation and its position brought
much closer to that of other broadcasters.
7. Tier 1 governs those matters that apply to all
broadcasters including such matters as guidelines on the portrayal
of sex and violence. OFCOM will develop overarching codes tied
to the statutory principles, which will bind all broadcasters.
These will also apply to the BBC, and the Governors will be responsible
for developing more detailed guidelines building on the overarching
codes and applying the standards to BBC services. There will be
one specific exception for the BBC: regulation of the impartiality
requirements will remain exclusively with the Board of Governors,
because this is so closely bound up with their overriding role
of ensuring the BBC's editorial independence.
8. Tiers 2 and 3 will apply to public service broadcasters
only. Tier 2 provides for consistent regulation by OFCOM of quantifiable
elements for which quotas or targets can be set. These will cover
the UK quota for independent production, and quotas or targets
for regional production and output, original production, and the
requirement for news/current affairs to be broadcast in peak time.
The same system of quotas will apply to all. The White Paper says
specifically that OFCOM will be responsible in future for both
agreeing and monitoring the BBC's compliance with the regional
production targets, and that there will be a requirement on the
BBC for the first time to provide news and current affairs in
peak time.
9. Tier 3 relates to the qualitative obligations
on all public service broadcasters, including the BBC. For this
tier greater fairness will be achieved by giving other public
service broadcasters a freedom similar to that already enjoyed
by the BBC. A system of self-regulation will operate. All the
public service broadcasters, including the BBC, will continue
to be required to provide a mixed and high quality range of programmes.
They will also be required to develop statements of programme
policy and self-regulatory mechanisms. The statements will be
updated annually.
10. Under this system the broadcasters will have
an opportunity to demonstrate that their obligations can be better
delivered and monitored through self-regulation. The BBC Governors
must equally demonstrate that they are regulating the BBC effectively.
In the run-up to the Charter Review in 2006, they must show not
only that the BBC continues to reach the vast majority of the
audience, but that it also fulfils its public service remit.
11. OFCOM will report periodically on the key cross
industry issues of public service broadcasting and we would expect
OFCOM's advice to be published. The BBC's Board of Governors will
naturally want to consider observations made by OFCOM in drawing
up the BBC's annual statement and all other broadcasters will
be expected to undertake a similar and formal process.
12. OFCOM will have restricted powers to resume more
detailed controls if there is a major failure by the commercial
broadcasters. The backstop powers for the BBC will remain with
the Secretary of State for Culture, Media and Sport and with Parliament
through Charter Review.
13. The Secretary of State will also retain the power
to approve new BBC licence fee-funded services and material changes
to existing services. OFCOM will, however, give formal advice
to the Secretary of State on the market impact of both proposals
for new BBC public services and for material changes to existing
ones, before she reaches a decision.
14. The BBC will also continue to be subject to economic
regulation, in future principally by OFCOM instead of the OFT.
As now, all broadcasters will be within the same legal framework
and subject to the common obligations imposed by such measures
as competition law and State aids controls.
15. The White Paper refers to the need for amendments
to the Agreement between the Secretary of State and the BBC. The
Agreement itself and any amendments are approved by Parliament
and it is through amendments that the Government intends to set
out the relationship between the BBC and OFCOM. The amendments
will work alongside the statutory duties and powers that OFCOM
will hold and both will be available for discussion when the Bill
is published next Spring.
16. This route fits the constitutional position,
which was reviewed at the time of the licence fee review in 1999.
It will be fully reviewed again in the run-up to 2006 when the
Charter will expire. We do not see the need for another review
at this time and by using amendments to the Agreement we can construct
a relationship that gives OFCOM a role without disturbing the
existing constitutional structures.
BBC COMPLIANCE WITH REGULATORY STANDARDS
In all cases the BBC's delivery of its remit and
compliance with regulatory obligations will remain the responsibility
of the Governors. However, the BBCwill usually be subject to the
same basic rules and standards as other broadcasters and these
will be set out either in legislation or in OFCOM codes.
Categories regulated
|
Standards to be applied
|
Subject to OFCOM regulation
|
Sole responsibility of BBC Governors
|
Comment |
Tier 1 - all broadcasting
|
Codes establishing negative minimum content standards set by OFCOM
|
same standards will be applied to all broadcasters
|
_
over-arching code |
own codes within OFCOM framework
|
Wherever OFCOM develops codes for the whole industry the BBC must comply with those codes but the Governors may set more stringent requirements for the BBC alone.
|
OFCOM will have powers to consider complaints against its basic standards for all broadcasters including the BBC. Includes the current statutory powers of the BSC.
|
same standards will be applied to all broadcasters
|
_ |
|
BBC is already subject to BSC but OFCOM's responsibilities will cover a wider range of basic content requirements. All apply to the BBC.
|
Rules on advertising and sponsorship
|
not applicable to BBC public service
|
|
|
|
Provision of fair, impartial and accurate news
|
all broadcasters under the same obligation
|
|
_
|
|
Tier 1 continued
|
EC quotas (independent production) |
all broadcasters comply with EU 10% quota
|
_ |
|
OFCOM will take on OFT's responsibility for monitoring compliance
|
targets for access for people with disabilities
|
same standards will be applied to all broadcasters
|
_
in OFCOM codes |
|
|
Other existing or potential industry-wide requirements and rules on other aspects of programming eg equal opportunities, training
|
OFCOM will promote across the industry
|
_ |
|
|
Tier 2 - public service broadcasting
|
quotas for independent productions |
25% quota set in legislation |
_
|
|
OFCOM will take on OFT's responsibility for monitoring compliance
|
quotas for original programming |
different quotas appropriate to each broadcaster
|
_
agreed by OFCOM |
|
|
targets for regional productions and regional programming
|
different targets appropriate to the broadcaster
|
agreed by OFCOM |
|
|
availability of news and current affairs in peak time
|
OFCOM defines peak time |
|
|
|
Tier 3 - public service broadcasting
|
qualitative aspects of broadcasting |
All broadcasters will be self-regulating |
|
_ |
All broadcasters including BBC prepare annual statements of programme policy and report annually on their performance against them
|
|
OFCOM monitoring
|
_ |
|
OFCOM will report periodically on the key cross industry issues of public service broadcasting. 'The BBC's Board of Governors will naturally want to consider observations made by OFCOM' and all other broadcasters will be expected to undertake a similar and formal process' (WP 5.8.4)
|
|
fall-back powers
|
|
|
OFCOM will have fall-back powers to intervene in respect of the broadcasters it licenses if they consistently fail to meet their obligations. In respect of the BBC, Parliament and the Secretary of State have fall-back powers at Charter Renewal
|
New service approvals
|
new services |
OFCOM licenses commercial broadcasters
BBC requires Secretary of State approval
|
|
|
OFCOM licences non-BBC services and any BBC commercial services.
Secretary of State advised by OFCOM on market impact of BBC services.
|
Economic regulation |
|
|
|
All broadcasters including the BBC are within the same legal framework, eg competition law and State aids controls.
|
| 
