Memorandum submitted by Equity
INTRODUCTION
1. Equity welcomes this opportunity to contribute
to the discussions surrounding the review of the BBC's Charter.
As the trade union representing 37,000 performers and creative
personnel, we recognise the importance of the BBC in our society.
The BBC is our most significant employer and it plays an integral
role in both the audio-visual environment and as a community focus
for the United Kingdom.
2. The BBC is one of four public service
broadcasters in the United Kingdom, but it is arguably the most
important. Each channel has a role to play in the public service
television broadcasting ecology by providing a focus for communities,
educating the public, and providing a shared sense of heritage.
However, the BBC has a freedom to lead the other broadcasters
on matters of standards, innovation and diversity only because
of its unique source of funding. The BBC has a key cultural role
within the UK—by setting programme standards and bridging
the gap between the information-rich and the information-poor,
as more quality programmes are drawn to subscription channels—it
continues to be our main public service broadcaster.
WHAT SCOPE
AND REMIT
SHOULD THE
BBC HAVE?
3. The BBC is much more than a broadcaster.
It is part of our society, it showcases the United Kingdom to
the rest of the world, it plays a crucial role in our economy,
both as an employer and an exporter of goods, and it acts as a
standard bearer for the audio-visual sector in terms of quality,
diversity, and innovation. Equity values each of these roles and
recognises that it is able to fulfil each of them only because
of its unique funding structure.
4. Equity believes that the BBC should retain
both its television and radio responsibilities. While a recent
report by the Broadcasting Policy Group recommended their separation
into two distinct arms, we believe that there are significantly
advantages in these functions to remain together. This dual broadcast
responsibility is important for its role in setting standards
for other public service broadcasters. This standard setting role
should not be undervalued because without the BBC, we believe
that viewers and broadcasters alike would suffer.
5. While we will concentrate on genre diversity
below, the role of the BBC in television and radio is incredibly
important. As cited above, it has a wider role in setting standards,
and bringing together communities. Additionally, it has a responsibility
to experiment in programme production.
6. The BBC also has an important role in
sustaining the independent production sector. Without the BBC's
investment and commissioning, the UK's production base, which
also serves the UK film industry, would not be as strong as it
is today. Even with the scaling down of BBC film production, its
television production has supported the industry and benefited
their in-house production. There does not appear to be any comparable
investment by other broadcasters and in the case of channels only
available through Sky, there is no indication that they ever intend
to match this level of investment.
7. Crucially for Equity members, the BBC
is the most important employer and trainer in the audio-visual
sector. It has provided a consistent source of employment in a
variety of programming, both audio and visual, and heavily invested
in the training and development of the industry. Despite increased
efforts of the other public service television broadcasters through
Skillset to invest in training, the BBC continues to far outstrip
them in financial commitments and training opportunities.
8. Equity would like to see the BBC retain
its commitment to programme making in and for the Nations and
regions. The BBC and ITV are the only public service broadcasters
to make programming specifically for different national and regional
boundaries. While Channel Four and Five share a commitment to
produce a proportion of programmes outside the M25, the BBC and
ITV are the only channels that offer programmes for the viewer
made in the region for the region they live in. Regional programme
production should not be confined to news and current affairs.
It should include drama and comedy for example, even if the broadcast
is restricted to the region it is produced in. In this latter
regard, the BBC falls short of meeting these commitments in a
number of regions, but particularly in Northern Ireland.
9. During the debate surrounding Charter Review,
some commentators will inevitably argue that the BBC should not
be obliged to provide "something for everyone". This
has long been a core feature of public service broadcasting and
one consistently identified throughout Government and regulator
inquiries and research. While the initial reasons for this requirement
on public service television broadcasters have long gone, with
the event of more channels and now new platforms, it is still
very important. This is most evident for those who cannot afford
to pay for subscription channels.
10. Equity believes that it is inevitable
that there will be some overlap of output with other broadcasters,
and we would argue that this does not matter. As long as the programming
is of the highest quality and offers alternatives that challenge
other broadcasters within genres, viewers will be able to access
a range of programmes and that is the most important measure for
the BBC.
11. Prior to digital switchover, there will
be individuals who actively choose to receive only those channels
available on analogue. Recent research by the Department of Trade
and Industry suggested that 13% intend never to switch to digital,
while a further 29% would do so when there was no other choice.
Additionally, there will be those people who cannot afford to
subscribe to channels or those that prefer linear viewing. If
the BBC and other public service television broadcasters cherry-picked
genres rather than providing programming for all, it would effectively
exclude minorities, economic and geographically-difficult viewers.
Additionally, while many niche channels continue to provide only
poor quality cheap programmes that are broadcast on a repeated
loop available by subscription only, there would be no justification
for the BBC to streamline its programme provision.
12. Equally, it should not be the BBC's responsibility
to only provide for genres in the public service environment not
produced by commercial public service broadcasters. This would
risk ghettoising the BBC and prevent it from setting standards
for all broadcasters. Equity believes that the BBC is at the core
of PSTB, and as such it is important that it should be allowed
and encouraged to continue its range of programmes and be supported
by the Licence Fee. We believe that the BBC should set standards
for all broadcasters, whether or not they have public service
obligations and that they have a greater responsibility to the
broadcasting environment because of the privileges of the Licence
Fee.
13. BBC Radio has demonstrated that their
unique system of funding alongside their public service obligations
can result in the production of high quality programming not available
anywhere else. BBC Radio produces a variety of programming across
its channels, and continues to provide the United Kingdom with
the finest radio broadcasting system in the world. Through BBC
Radio, the United Kingdom is able to access a consistent choice
of high quality programming across genres such as drama, comedy,
music, schools, sport, education, arts, sciences, news and current
affairs, not found on any other radio station.
14. This dedication to diverse genre provision
is most evident in drama programmes. Drama programmes, including
the single play, continues to excel and to push the barriers of
imagination on radio. The initiatives with children's programming
on BBC 7 have brought a new and growing audience of children.
Radio is an important educational tool, and Equity welcomes the
BBC's commitment in this area. Additionally, the BBC's support
across a range of music is significant. Listeners are able to
access classical, pop, middle range, jazz, folk music and world
music; the choice is outstanding. It should also be noted that
BBC support of orchestras, singers, new and established composers,
the proms and live concerts around the UK makes a major contribution
to this important aspect of the culture of the nation.
HOW SHOULD
THE BBC BE
FUNDED?
15. Equity believes that, despite it imperfections,
the continuation of the Licence Fee is essential for the survival
of high quality, diverse and original public service programming
on the BBC. We believe that without the Licence Fee, the BBC would
be unable to continue to meet its public service obligations.
It would not be able to act free of market concerns and trends
and it would be forced to react to developments in the way the
commercial PSBs have had to do repeatedly over the last five years.
Operating in a market-orientated environment would put a huge
strain on the BBC (and the commercial broadcasters) and we do
not believe that any of the alternatives suggested by commentators
would allow the BBC to be as significant and respected as it is
now.
16. If further convincing were necessary,
the Government only needs to look at the experiences of other
countries to see the possible implications of changing the BBC's
funding. ABC in Australia, TVNZ in New Zealand, CBC in Canada
and PBS in the United States are all poor examples of public service
television broadcasting when compared to the BBC. These channels
are forced to weather advertising slumps, seek sponsorship, raise
money through telethons or beg Governments for public subsidy.
As a result, they fail to live up to their potential and are often
criticised for poor, unimaginative programming or worse, that
their editorial independence is questioned.
17. Additionally, a recent report by Oliver
& Ohlbaum Associates called UK Television Content in the Digital
Age identified that redirecting BBC funding may increase commercial
audiences but the consequent pressure on airtime prices would
limit actual revenue increases for commercial broadcasters. As
commercial broadcasters recycle a lower proportion of revenue
into original production, the net effect would be to lower the
overall level of domestic content investment in the UK market.
Additionally redirecting existing or new public funds to commercial
broadcasters to subsidise high cost genres could result in these
funds being distributed to shareholders or new ventures which
do not rely on quality, home-grown programmes, effectively crowding
out new commercial investment.
18. Public service broadcasting often relies
on broadcasters to act in a way in which the private sector, left
unregulated, would not. While the Communications Act defines that
those obligations should be, it is only the BBC without the concerns
of shareholders or failing advertising prices that can truly embrace
them. In doing so, it provides a standard of programming that
the commercial PSTBs can measure themselves against and other
commercial broadcasters can aspire to meet. It has only been able
to do that because it operates in a mixed broadcasting economy,
using significant public investment in the form of the Licence
Fee.
19. We have detailed below our consideration
of each of the proposed alternative funding possibilities for
the BBC. It is important to consider the experiences of other
countries when considering these alternatives.
(a) Advertising
Advertising is being spread among more and more
broadcasters, and it is still suffering from the effects of an
economic downturn. ITV reports an 18% downturn in advertising
since 2000. It makes no sense for the BBC to share a diminishing
source of revenue, especially as it is likely to result in irreparable
damage to all broadcasters. As well as reducing Channel 4's ability
to produce high-quality programming, introducing advertising to
the BBC threatens the quality and diversity of BBC programming.
Producers would seek programmes generating high audiences to ensure
high advertising.
(b) Sponsorship
Programmes would become reliant on their sponsors
and editorial values could be threatened. The risk of sponsorship
withdrawal would make planning for the future less certain and
is likely to result in a decrease in worldwide recognised quality
of programming.
(c) Subscription
Making the BBC a subscription only service will
create a number of problems. Firstly, while the Broadcasting Policy
Group may consider that the BBC will be able to offer a selection
of packages of their services, we believe that for the current
television services to be financially viable, they would need
to be either sold as a group or part of a bundled package with
other broadcasters. The latter would cause problems for European
audiovisual regulations. Additionally, it is likely to cost viewers
more than the current Licence Fee to access these services, if
the current quality and range levels are maintained. At present,
figures show it costs £4 to collect the BBC Licence Fee per
head, compared with £24 per head to collect one year's subscription
to BSkyB. This would be reflected in any subscription costs. If
the Licence Fee were to be supplemented by subscription this would
also increase the burden on viewers, including those poorer people,
who would be deprived of the full range and quality of the BBC,
which would otherwise be universally available. Finally, we are
unsure as to how this approach could be applied to radio services.
It would mean separating the BBC into radio and television organisations
and we believe that in order for them to continue to produce a
range of high quality programming, they need to operate together.
(d) Combination of Commercial and Public
Funding
If the BBC was funded by a licence fee and commercial
funding, future European rules could turn the BBC into a ghettoised
public service, providing a limited range of "worthy"
programming equivalent to PBS in the USA.
(e) PSB fund—"Arts Council for
the Air"
Some commentators argue that the Licence Fee
money could be made available to other broadcasters to produce
"worthy" programming. We are concerned both about how
that "worthy" programming will be judged, and also how
the BBC could continue to act as a public service broadcaster
if any of the Licence Fee was diverted away from it. If the intention
were to ensure that money is made available to the industry as
a whole, Equity would argue that this is already the case through
the BBC's independent production obligations. This in effect means
that independent production companies are able to pitch for Licence
Fee money. One other issue to consider would be the fate of advertising
revenue earned for advertisements placed around a programme that
has been produced using money from the fund. It would be difficult
to agree that this money should not be returned to the fund, but
should instead be absorbed by the commercial broadcaster. We would
also be concerned that any body created to administer a PSB fund
would result in another level of bureaucracy that all broadcasters
would have to accommodate.
20. Furthermore, we believe to enable innovation
and allow the BBC to fulfil its Public Service remit, the Licence
Fee should rise by above RPI annually with concessions to certain
sections of society such as the old and the disabled. Any concessions
need to be revenue neutral to the BBC, be perceived to be fair
by the public, but also affordable in terms of administration
and finite.
How should the BBC be governed or regulated
and what role is there for Ofcom? Is a 10 year Royal Charter and
Agreement with the Secretary of State the most appropriate regime
for the BBC?
21. Equity considers the Royal Charter to
be the most effective way to sustain unique nature of the BBC.
We believe the Charter provides the BBC with independence that
could otherwise be compromised.
22. With regard to the regulation of the
BBC, we would advise against incorporating the Corporation under
the remit of Ofcom. This regulator is new and untested, and it
already has significant responsibilities in the telecommunications
and broadcasting sectors to get to grips with. We believe the
additional pressure in regulating the BBC at this stage would
be too much and therefore unwise. Unless therefore, the Government
can propose an alternative, Equity considers the BBC should remain
under the regulatory control of the Board of Governors.
23. However, this does not mean that the
Governors should remain untouched. Instead, we believe a lot can
be learned from the debates surrounding the creation of Ofcom
especially regarding transparency. We consider there is a need
for a greater clarity of the role and function of the Governors,
and that they should be separated from the day-to-day functions
of the BBC. However, we do believe that there is some value in
the Governors having a professional background, including some
experience of managing a large business. Additionally, the amount
of information available about the decisions and working policy
of the Governors should be increased as an overall strategy to
be more transparent in their operation.
March 2004
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