Examination of Witnesses (Questions 140
- 154)
TUESDAY 22 JUNE 2004
LORD BURNS
Q140 Michael Fabricant: Intuitively,
I suspect you are 100% right.
Lord Burns: I do not have any
evidence other than my own observation.
Q141 Michael Fabricant: I remember
some 30 years ago you telling me off once, because I made certain
assumptions and you said, quite rightly, "You may well be
right but has any research been done on this?" Can I urge
you or the Department of Culture, Media and Sport, if research
has not been done, to do research, not just into people's viewing
patterns but behaviour patterns? Surely, does that not create
a whole direction in which the BBC might go in the future?
Lord Burns: I am very happy to
be ticked off on that.
Q142 Michael Fabricant: How broad
is the remit? Derek Wyatt asked about the length of charter renewal,
but would there necessarily be a charter? Are you looking at the
possibility of there being a statute instead? Are you looking
at whether the BBC should be going into new areas of technology,
not just broadband, but other forms of interactivity? Are you
looking at possibly other forms of funding for the BBC? What assumptions
are being made as fixed or are there no assumptions about the
future of the BBC at this stage?
Lord Burns: What we are looking
at is charter review, charter renewal. Within that charter and
the letter of agreement at the moment, there are a certain number
of things that have to be decided. One of the things that has
to be decided is a system of governance and regulation. Some things
will come to be determined at the point of the charter renewal
and in the letter of agreement. Some of the other things that
tend to be discussed would be things that you would hope would
emerge through the process of governance and regulation. Not everything
has to be decided at the outset. I am very conscious that quite
a lot of things you could not hope to decide at the outset. In
terms of things which you have mentioned, they are very much on
the table, as you will see from the consultative document that
DCMS issued. So issues of funding, issues of governance, the particular
structure of the BBC, as well as the remits of particular channels
and particular programmes are very much there to be debated. At
this stage, we are pre-Green Paper. As far as I am concerned,
that leaves almost anything to be debated that people wish to
be debated. At the Green Paper, some of those options will probably
be narrowed down and there will be argumentation for and against
the options. Then there will be another period of consultation
which will lead to the White Paper later in 2005. At this point,
we are willing to look at a very wide range of issues and I hope
that was demonstrated by the nature of the consultative document
that was issued at the end of last year.
Q143 Michael Fabricant: How much
freedom do you think the BBC should have to explore new areas?
The Chairman and I were discussing this yesterday. We do not think
the BBC had to seek permission to go into new media. I personally
think that it was a wise decision and the BBC news website is
probably the best website of its type in the world. Certainly
if its hits are anything to go by and its popularity is anything
to go by it must be because it is the most looked at news website
in the world. Do you think the BBC should have that freedom to
do that or do you think the BBC should be more constrained to
just provide broadcast television and radio?
Lord Burns: It is very difficult
over a 10 year period to define at the outset what it is that
a broadcasting company can do. That is why I made the point that
you need a remit, a broad charter and a broad set of obligations
that fall upon the corporation; and you need a system of governance
in place, in which you have confidence, that can make some of
those decisions during the course of the charter period. Some
of the issues in terms of scope, reach and the approach to dealing
with new technology are things that should be possible to be taken
care of within a good system of corporate governance and regulation.
You do need some constraints. As you will have seen from some
of the evidence that you have had presented to this Committee
as well as the evidence that we have had, one of the things that
worries some of the commercial competitors to the BBC is that
the BBC can decide what to do without any process of consultation
and without any constraints being placed upon them. Some others
worry that it may be over-constrained in not being able to go
into some new areas. What you want out of the system of governance
and regulation is something that can take care of both of those
events; which draws the line in the right place; but which nevertheless
gives the freedom to move into areas that it is sensible they
should move into. That is a combination of the remit that they
are given and of the governance process which is trusted to be
able to make those decisions as you go through a charter period.
Q144 Chris Bryant: With all the cables,
boxes and so on that you now have to have in your sitting room
to be able to watch television, let alone to make sure that other
sets in the house can work, and watch the channel that you want
to watch, it is pretty perplexing. When you go to Dixons or wherever
to buy a television, it is almost impossible for the ordinary
consumer now to see their way through the complexity. The traditional
argument for a licence fee, which is obviously deliberately circumventing
the market, is that we are buying a public good, whether in terms
of the local production because we are making British programmes
which might not be made if it were not for the licence fee, or
you have local news, extensive news gathering which would not
be commercially viable and you are doing genres like comedy that
would not be commercially viable, and on top of that there is
a universal access provision. Do you think that argument still
holds for the licence fee?
Lord Burns: After the digital
switch over, some of the arguments that were made for the licence
fee are going to be less powerful than they were. Some of the
points that you make should not exist in quite the same form that
they do now, or that they did before we were in the multichannel
world. One of the objectives of public service broadcasting was
to provide a variety of programming, not necessarily just catering
for the mass audiences at all times: particular types of genre,
particular types of programming, that might not be commercially
viable in advertising funded media. As you move into many, many
channels, it should be possible to see more of that programming.
On the other hand, it is quite striking to me, from discussions
that I have participated in so far and the evidence that I have
read that people still see an important role for a broadcaster
who is not being driven by either the requirements of subscription
or the requirements of advertising, both in terms of the diversity
of programming and in terms of being able to reach audiences for
specific types of programming, and which gives confidence in terms
of quality. A lot of people simply enjoy watching television without
any advertising. Although the argument has weakened in some areas,
I think there is still going to be a demand for a certain type
of what is called public service broadcasting. I thought the Ofcom
review took us through quite a lot of that argumentation very
well. I also agree that the time will come, if the number of people
who are watching the BBC declines very sharply and there is the
ability to switch people off who do not wish to pay, that the
balance of the argument between the licence fee and subscription
is going to change through time.
Q145 Chris Bryant: Would you accept
that maybe whilst that is an argument and that perhaps leads you
to a situation where you would say you have to much more narrowly
circumscribe what public goods you are buying and the BBC has
to therefore have a much more detailed list of things that it
has to do and things that it cannot do, perhaps there is another
argument which suggests that because broadcasting will always
tend towards monopoly because it is very expensive to make the
first copy, relatively cheap to distribute to everybody else,
but it is very difficult for new people to enter the market and
you need a hefty player which does rig the market so that there
is competition for quality as well as just a competition for viewers?
Lord Burns: The way I have approached
this is very similar to the way it has been approached in the
Ofcom review. I start with the question: what type of programming
do people wish to see available? The second question is how much
of this is likely to be delivered by the market place. And the
third question is, if there is a difference between those two
things, what kind of intervention do you need in order to bring
them together? Because our market has been so rigged throughout
the entire history of radio and television, we have no real way
of judging with any confidence what an entirely market driven
system would produce for us and whether it would produce those
things that we want or whether it would fall short of those things.
I am certainly not going to jump in and make any strong predictions
about that at this stage, but evidence will begin to emerge as
we move into the new world and as we gain experience of it. It
is going to be important to be rather more specific about what
the remits are for the BBC with regard to both radio and television.
It has to take into account what is being delivered in the market
place more generally. To me, you cannot just set about it as if
that market place did not exist.
Q146 Chris Bryant: One of the traditional
parts of the BBC's remit has been producing British programmes
and British content.
Lord Burns: I suspect that will
remain important for some time.
Q147 Chris Bryant: If you translate
that into a new era, the content that many young people—the
15 year olds and so on that we have been talking about—enjoy
is some form of game. To old folks like us, a game is something
ephemeral and irrelevant, but the content inside that can be every
bit as imaginative and creative and story driven as a BBC costume
drama. Is there any reason why the BBC should not be doing games?
Lord Burns: I would ask the same
questions that I asked earlier: what kind of games would you like
to see available to people? Maybe some of them would be educational;
maybe some of them would be aimed at particular age groups; maybe
some of them would be aimed at particular niches and you might
ask yourself the question are they going to be delivered by the
market place. If yes, end of story. If not, you may then ask yourself
the question whether the BBC are the appropriate people to be
doing it. My instinct is that I would doubt it; but it would possibly
be one of the ways in which you might wish to intervene in this
market. There are other ways of bringing that about if you want
a particular kind of educational game and software. I approach
this from the point of view of asking what is it we want to see;
what is it the market is going to deliver; what is the best way
of intervening in order to get the outcome that you want. So far,
the licence fee has been shown to be an effective way of doing
that.
Q148 Mr Flook: You spoke earlier
about how well loved the BBC is and indeed it probably is one
of the great brands of the 20th century. Yesterday, we heard from
Simon Jones, the head of MIT Europe, when we visited them, that
that is potentially very similar to Kodak which made silver paper.
They were well aware of the digital threat and they could see
it but they would not do anything about it. They had great leadership,
a great brand, the ability to produce an alternative but they
did not do anything about it. What role do you see in giving your
advice to the BBC going forward and what role do you see charter
renewal has in helping the BBC to avoid that Sword of Damocles?
Lord Burns: First of all, it is
an important part and has been an important part of the BBC's
role that it has engaged itself extensively in the technology
of broadcasting. It has been a very important player in developing
new technology. Far be it from me to defend the BBC but so far
I would have said their record was pretty good in embracing digital
television and digital radio and the internet. Already, we see
the enormous use that is being made of broadband with respect
to being able to listen to radio programmes that you may have
missed. At this stage it would not be one of my criticisms of
the BBC that they had been rather sluggish in the way in which
they have embraced new technology. Indeed, I am often surprised
when I go to some other countries and discover that they do not
have a lot of these things. That is not enough of course. We are
looking at this in a forward looking sense. I think an important
part of the remit of the charter—I think it is in the present
charter—is about the BBC's role in developing broadcasting
technology as well as trying to make it universally available
of course.
Q149 Mr Flook: Which is precisely
what the Kodak executives said as well. They could see it but
they would not do anything about it. I am no technologist, but
there could be a tremendous sea change in the way we all receive
and watch television. That may not be broadcast and that is a
dangerous word. We may not receive broadcast media. We may receive
programmes which the BBC makes and we could hold out the BBC justification
from within quite simply. I rather hope you will be able to take
that on board and talk to the MIT people you mentioned earlier,
because I think there are lots of things in the future that the
BBC are aware of but could not necessarily do anything about.
Lord Burns: I take on board what
you say and I am very happy to follow that up. I would again want
to ask the questions as to whether some of this will emerge anyway
and whether it is the BBC's role to get themselves involved in
it, and how it fits with the other players in the market place.
Q150 Alan Keen: Because of the nature
of your role, we are having a discussion rather than an interrogation.
Lord Burns: I am very grateful
for that.
Q151 Alan Keen: We have quite different
views on the Committee. A lot of the time we want to be entertained.
I am lucky enough. My interactivity is on cricket or football
themes still. When I watch television, I am in a wonderful illustration
of the binary code which is really the basis of all this important
technology. I am either awake or asleep on the settee. Nothing
beats that. I have never taken drugs but I am sure you cannot
beat drifting in and out of sleep. I want to be entertained. At
MIT it is obvious what wonderful technology they have. The BBC
can still put on what I would call shows but maybe we will get
not just 3D TV but characters that can appear to move around the
room. This is where we can use the technology but we still want
to be entertained. The important thing is this: people have talked
a lot of tripe about public service broadcasting and trying to
define it. Why cannot we look at the BBC as just a different way
of ownership? Why do we not democratise it a bit more so that
the public own it and can influence the decisions that are made
by the BBC more than now? Some people say they are impressed by
commercials or it should only give weather forecasts and the rates
of national insurance contributions. Can we not just say to them,
"Do what you like, BBC. Provide what the public want but
democratise it so that the public have an input"? What do
you think about that?
Lord Burns: Let me repeat one
of the observations that I think is made in the Ofcom review.
There is a group of people who talk endlessly about public service
broadcasting but when you go and ask the customers, the consumers,
the people who watch and listen, about public service broadcasting,
they do not have a clue what it is you are talking about. The
issue to them is do they like and trust what they get and what
are some of their concerns. As I said earlier, one of the conclusions
I reach is that most people do seem to like the BBC but that does
not stop a substantial number of them having a grouse of one kind
or another. One of the grouses is that too many of the programmes
are derivative of other programmes that they can see elsewhere.
They seem to be copied and there are endless programmes of the
same type. Also, one of the issues that does get raised is whether
or not they themselves are having sufficient influence in terms
of the governance and accountability process. I have some sympathy
with what you say, but if you are going to raise the amount of
money that the BBC gets from the whole population in the form
of this compulsory levy, if you wish to watch television, it seems
to me that there are quite a lot of obligations that fall upon
them rather than just doing what they want to do. The debate about
public service broadcasting is trying to define what those obligations
are. Historically, those obligations have been about putting on
certain types of programming; about the quality of them; about
fairness and impartiality in news and current affairs; about meeting
a range of types of programming for a range of people and not
just concentrating upon the things which large audiences wish
to watch. My instinct is that that is going to remain the case.
If you are going to fund an organisation in the way that the BBC
is funded, some very special obligations fall upon it as to what
it should do with that money as well as how it should be accountable
and how it should be influenced by what the viewers want.
Q152 Alan Keen: The health service
is quite a good parallel. We do not think that having 147 private
companies providing health care throughout the country is going
to give a better service than the health service. The health service
has certain things it has to do. I would pay £121 for Radio
4 alone. It is a cheap way of providing wonderful broadcasting,
the same as the health service. Please look at that.
Lord Burns: There is force in
what you say but the health service is rather different from broadcasting
in respect of the alternative means of delivering those things,
the alternative ways in which people receive their treatment and
the extent to which it is necessary or not. We have obligations
that we place upon people in return for public funding and, having
spent a large part of my life engaged in the job of trying to
decide who should receive public funding and what they should
do in return for that, I do think it is important that there should
be some very strict criteria and remits. And there should be very
tight control in terms of ensuring that you have good systems
of corporate governance for people who are in receipt of large
sums of public money. The BBC is in receipt of a very large amount
of public money.
Q153 Mr Doran: I want to pick up
a few micro issues to get away from the big picture and I will
wrap everything up in one question. One of the areas that the
BBC have not been very good at over the past few years is, first
of all, in the use of independent producers. I know that is an
area that you are going to look at. In terms of regional production,
often there has been a feeling that a regional production is just
a crew moving from London, doing the filming and everything else
in the region, but we want to see the use of regional facilities.
In the area of public service broadcasting, the BBC along with
the independent television companies have an appalling record,
not just in supporting British film but in showing British film
on television. As far as the first two are concerned, I would
be interested to hear how you are going to approach these two
issues and, on the third, I would like your confirmation that
in looking at the public service broadcasting remit you will be
looking at the attitude to British film.
Lord Burns: Each of those issues
does come up in the consultation and survey the visits that the
Secretary of State has had around the country, talking to various
groups in preparation for the debate on charter review. Those
points have often been made. Each of them however—independent
production, regional production, issues about films—fall
into the two categories I mentioned earlier. It is partly a question
of how you deal with them in terms of the overall remit that you
give to the BBC at the time of charter renewal. The second thing
is how you engage the system of governance and regulation to deliver
what you have asked them to do. In the case of independent production,
from what I can gather, there are ambitions that have been laid
down which have not been met and it seems to me that that is an
issue for governance as to how it is that that is the case and
how it is that the governance process insists that it should happen.
In terms of regional production, most people outside of the M25
who are in the broadcasting world complain quite bitterly about
the amount of work that goes on inside the M25. Again, as long
as government defines what it is it expects in those areas, it
should then be a matter for the governance to take care of. Films
I have heard rather less about but it is an issue that comes up
and I am certain it will be aired as we go through this period
of consultation.
Q154 Rosemary McKenna: I am one of
those people who absolutely love the BBC and I do think it is
really important, with a worldwide reputation, and the BBC World
Service is so important. But ought not the BBC to concentrate
on providing really good quality news and entertainment? Should
it continue to make some decisions, that it has done, I think,
over the last few years, purely on commercial grounds, to keep
or increase its audience share, and should that be part of the
Charter Review?
Lord Burns: I think a lot of people
share just the views that you have mentioned, which is that they
do like the BBC a great deal and they do want it to concentrate
on providing very good quality news and entertainment. The issue
of quality comes up time and time again in terms of the feedback
that we have. From what I interpret from this evidence, people
do not want to see on the BBC simply what it is that they can
see elsewhere; they are expecting something that is a bit better.
Undoubtedly, in the consultation that we have been through, there
is also some concern about the emphasis that is being put upon
gaining audience share. I think one of the issues that will come
up for quite a lot of discussion during this period is whether
there is a better set of measures of success at the BBC, rather
than simply looking at what is the share time of peak viewing
that they get Monday through Sunday? There is already talk of
giving greater weight to things like audience reach rather than
simply audience share. And there may be other means of trying
to get people's appreciation of the quality of what it is that
they have seen as well as whether or not they have watched it.
That has become quite an active area for debate. When I read the
autobiographies of people who have worked for the BBC in the past,
you can see that this struggle has gone on for quite a long time;
of trying to keep a balance between audience share and the quality
of programming. There is clearly a fear that if you let the audience
share drop below a certain level, you will begin to put in doubt
the future of the licence fee upon which all of their lives depend.
So you are trying to ride the balance of the two issues; between
being innovative, doing new things, and keeping up levels of quality,
but also hanging on to a certain audience share. We will each
have our own views at different points in time as to whether that
balance has swung one way or it has swung the other way. Quite
clearly quite a lot of people share your view, that it has swung
slightly in the direction of worry about audience share. I think
one of the things that we hope to debate during this period is
to see if there are some other measures of success and appreciation
that may be able to figure a little more prominently than simply
the question of audience share.
Chairman: Thank you. Lord Burns, it is
always a pleasure to have you here. So many jobs to do and only
one person to do them! Thank you very much indeed.
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