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Mr. John Whittingdale (Maldon and East Chelmsford) (Con): I thank the Secretary of State for allowing me sight of her statement in advance. In many areas the direction set out for the BBC is the right one, but in almost every case the statement does not go far enough. Instead, a number of largely cosmetic changes are proposed to the structure and oversight of the BBC. It appears that, once again, the BBC has successfully fought off all proposals for substantial or immediate change.

We welcome the Secretary of State's recognition of the fact that the broadcasting environment is in the middle of a period of extremely rapid change. Every day more households switch to digital, gaining access to tens, if not hundreds, more channels. Many are choosing to pay more for what they want to watch. If the BBC is to continue to receive public subsidy, it must provide programming that is different and in the public interest. It must have even greater regard to its public duty to set the highest standards for the quality of its programmes, its regard for public feeling and its treatment of commercial rivals and suppliers.

The clear remit for individual BBC services and the stronger public service obligation to which the Secretary of State referred are badly needed, but they will make a
 
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difference only if they are rigorously enforced. As we have seen with the independent production quota, the BBC has been happy to pay lip service to the obligations placed upon it until faced with an external regulator with the power to impose real sanctions if it fails to comply. For that reason, almost every independent commentator has recommended the establishment of an external regulator, separate from the BBC.

The Secretary of State has described the existing arrangement as unsustainable. The chairman of the BBC has already gone some way to distance the governors from the management. Today she has announced that the board of governors is to be replaced by independent trustees, but that is a long way short of the external regulator that we, and others, believe to be necessary. What is the difference between the independent trustees whom the Secretary of State intends to appoint and the new arrangements for a more independent board of governors that are already being put in place by the chairman of the BBC? Is it not the case that the trustees will still be part of the BBC and will not provide the external supervision that would be provided by a public service broadcasting commission fully independent of the BBC, as was recommended to her by Lord Burns?

The Government have already given Ofcom responsibility for adjudicating on complaints about harm and offence caused by programmes, including those broadcast by the BBC. Why will the Secretary of State not accept that Ofcom should have equal powers to adjudicate on complaints about the BBC's accuracy and impartiality, as it does for other broadcasters? She has referred to the large number of complaints from the commercial sector about abuses by the BBC of its dominant position. She went on to say that she would consider allowing Ofcom to adjudicate on complaints about the BBC's unfair competitive practices. That is a welcome step forward, but why does she need to consider it? Why can she not say today that Ofcom will take over that responsibility, so that we no longer have the existing position whereby the BBC promises to examine such complaints and then, once a decent interval of time has passed, rejects them?

Why has the Secretary of State again rejected the powerful recommendation of the Public Accounts Committee that the BBC's spending be subject to the full independent scrutiny of the National Audit Office? The BBC receives about £2.8 billion of public money, yet it is still unwilling to open its books fully to the Comptroller and Auditor General, and through him to Parliament. If the Secretary of State really wants to improve the transparency and accountability of the BBC, she should make that change straight away.

Let me now turn to the funding of the BBC. As the Secretary of State started by saying that she regarded it as improbable, if not inconceivable, that there should be a change to the licence fee, it must have come as something of a shock to her to receive Lord Burns' report, which states that sustaining the licence fee will become increasingly difficult. Her acceptance of that principle is a welcome change, but her agreement to a continuation of the licence fee for another 10 years means that it is essentially business as usual.

Does the Secretary of State accept that if a move towards subscription were to occur, it would require households to have access to conditional technology?
 
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What do the Government intend to do to encourage that? Given the pace at which change is happening, why is she refusing to contemplate any change to the licence fee system until 2017 at the earliest? In the past seven years the licence fee has gone up by 30 per cent. in real terms. Can she at least guarantee that it will not increase in future by more than inflation?

Why have the Government also rejected for at least 10 years the recommendation of Lord Burns' panel—supported, we understand, by Lord Birt—that licence fee money should be made available to other broadcasters for public service programming? Does she accept the analysis of Ofcom that over time, competitive pressures will continue to reduce the amount of public service broadcasting on commercial channels? If she does accept that analysis, what does she propose to do about it?

We agree with much of what the Secretary of State has said in her statement, but having identified the priorities and challenges for the BBC, the Government have shied away from addressing them. We share their wish to see a strong BBC producing high-quality public service programmes, but we also believe that the need for change should be addressed now, and that the charter should be looked at again in five years' time. Instead, the Government appear content merely to tinker at the edges of the existing structure while essentially allowing the BBC to continue for another 10 years with business as usual.

Mr. Tam Dalyell (Linlithgow) (Lab): On a point of order, Mr. Speaker. It is deeply unsatisfactory that we have—

Mr. Speaker: Order. The Father of the House knows that points of order can be taken only—

Mr. Dalyell: We have not had a copy of the statement.

Mr. Speaker: It is no fault of any Official of the House that the statement has not been circulated. The Vote Office received the statement only recently. [Interruption.] Order. I am not here to say whose fault that is; I am explaining that it is not the fault of any Officer of the House.

Tessa Jowell: On that specific point, I have just been passed a note saying that the statement had not been circulated before I got to my feet, and I apologise to the House for that. Obviously, I shall supply you, Mr. Speaker, with information about why that happened.

A number of the points made by the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale) are interconnected, but let me start with the fact that there is a profound difference between the Opposition's view of the future of public service broadcasting and the view on the Labour Benches of the Government's position. The Government see public service broadcasting as providing a bedrock built on universal access and safeguarded by a universal licence fee—a licence fee that is more popular and sustainable, despite its regressive nature, than any of us might have expected at the beginning of this process. I believe that the proposals that I have set before the House today respond very directly to the public opinion expressed by thousands and thousands of people during the process of consultation.
 
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What I have not done is rule out alternative forms of funding in the future. Indeed, in response to the hon. Gentleman's point, I recognise the profound changes that the switch to digital will bring. That is why, at about the time of switchover, we will conduct a review of alternative forms of funding for the BBC and public service broadcasting more generally. In advance of a new charter—in other words, before 2016, in about 2010 or 2012—in the light of the evidence at the time, we will also look at the case for some of the licence fee income being used to ensure choice and plurality for other public service broadcasters, such as Channel 4 and so forth. Those are decisions for five or six years' time; they are not decisions for now, but I have made it clear that they will be for consideration within the next charter period.

On compliance with the requirements that the trust will set for the BBC, the BBC trust will be able to impose very tough penalties and sanctions in the light of failure of any individual part of the BBC to comply with the service licence. Such sanctions might include moving money from one channel to another; it will be for the trust to dispose of such matters.

On the profound difference between the overhaul of the BBC's governance that we have set out today and the present situation—I do not think that the hon. Gentleman can have been listening that closely to what I had to say about this—the separation of the unsustainable dual present function, whereby the governors both regulate the BBC and oversee its management, will end. We will have a BBC trust that is responsible for the oversight of the BBC and for its governance.

I believe that the proposals that I have set out today meet the issues raised by the public in the course of consultation. They are not all entirely acceptable to the BBC, but that is not the point. I believe that the BBC will rise to the challenge that we have presented to it today, and that it will do so in the interests of the long tradition of public service broadcasting that it has led.

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