Examination of Witnesses (Questions 600
- 619)
TUESDAY 2 NOVEMBER 2004
DEPARTMENT FOR
CULTURE, MEDIA
AND SPORT
Q600 Chris Bryant: But with many
digital set top boxes coming down to £25 that £2 billion
would go a long way, would it not?
Lord McIntosh of Haringey: It
is not the intention that we should be paying for everybody's
set top boxes, nor has it ever been the intention.
Q601 Chairman: This Government has
got an interesting record in terms of assisting people with various
expenses, ie the £200 winter fuel payment for pensioners,
£100 towards the Council Tax, the free television licences
for 75 year olds. Has there been any consideration whatsoever,
including of these various benefits, of a free set top box for
people either of pensionable age or 75 years old or whatever because
that would certainly take into account the kind of thing Mr Hawkins
has been talking about and also the kind of thing that Chris Bryant
is just talking about?
Lord McIntosh of Haringey: We
have been consulting and we have been talking to representatives
of poverty charities and Age Concern and people of that sort about
a number of options and those options have included the provision
of free equipment or a voucher towards free equipment or the possibility
of technical assistance, in other words helping people to understand
how to put the kit in, which seems to us to be more important
for the over 75 year olds possibly than financial help. All of
these options have been very closely studied, they have been costed,
they are being discussed with the people concerned and we shall
be making an announcement about it at the same time as we make
our next major announcement about digital switchover.
Q602 Chris Bryant: You mentioned
different MPs writing to you. I think it would be true in my constituency
that the vast majority of people would want us to move to digital
switchover as soon as possible because that would resolve many
of the issues that they have. We are talking about access issues
in part because everybody pays the same licence fee but not everybody
gets the same deal in the end because they do not have the same
access to all of the channels. Do you think that in the next Charter
there should be specific obligations or targets of some kind in
terms of access for the BBC?
Lord McIntosh of Haringey: These
are targets which are not only for the BBC but they are for broadcasting
as a whole. Chris Smith set those targets five years ago now when
he set targets of affordability and accessibility and we feel
bound still by those targets, but they do not just apply in the
BBC, they apply to all public service broadcasters.
Q603 Chris Bryant: But many of the
licence payers who only pay a specific amount of money for the
BBC through the licence fee are troubled by the fact that they
do not have the same access to all the channels that other people
do for a whole series of different reasons and on top of that
we are entering a world where the electronic programme guide,
the technical standards inside the box and there may be lots of
different kinds of boxes, some people with Home Choice, some with
Sky, some with Freeview and so on, all these difference systems
mean ordinary licence fee payers will have to navigate their way
through. Do you think that the Charter should be very explicit
about the way that the BBC has to operate in that field to maintain
universal access?
Tessa Jowell: I think we will
want to think about that. This is the point at which the action
that we are taking to achieve switchover interconnects with the
role of the BBC as one of the major funders of switchover and
I think Andrew has put the position very clearly indeed. There
is another point which you have raised with me and others on a
number of occasions, which is the sense of being short-changed
that many licence fee payers have if they cannot get Freeview.
That is why we are moving ahead as fast as we think is prudent
and achievable with switchover, because I think that if that position
remained more or less unaltered for another five or 10 years then
the high level of public support that we have at the moment for
the licence fee would begin to break down and show quite a large
degree of regional differential and the parts of the country that
would begin to withdraw support for the licence fee would be those
that felt they were being denied the benefits, a sort of full
membership of the BBC. This is a factor which is very much influencing
our thinking both in relation to the principles underpinning switchover
but also to the principles underpinning the BBC's new Charter.
Q604 Chris Bryant: I want to change
tack slightly and ask about what level of involvement there should
be from outside in the running of the BBC either through the Charter
or through ministerial or Parliamentary scrutiny because on the
one hand everybody will want to see a fully independent BBC that
sails off into the sunset and produces wonderful programmes for
everybody and everybody loves it, but on the other hand some people
might say that the fact that the BBC has got 300 journalists in
the United States today for the American elections means there
may be a certain degree of wastefulness going on there. Some might
say the BBC does a wonderful job and yet they are thinking of
moving Panorama and it will not be on at the right time.
When you gave your licence for BBC3 you intervened quite directly
in quite a series of issues about genre. Do you not think that
the Charter renewal process itself is one of the few ways that
we can keep the BBC honest because they know there is a time when
they have to produce a lot of public service broadcasting on television
so that politicians think they are doing a very good job and so
on? If so, do you think a long Charter is a bad idea or should
there be other points where scrutiny can be more robust?
Tessa Jowell: Just as I know this
is reaching to the heart of your inquiry, this is an issue that
we are giving a great deal of thought to, Terry Burns is giving
a great deal of thought to it and I think the BBC are themselves.
I know that in the course of your inquiry you have looked at whether
or not the Charter, the relationship between the sovereign and
the BBC, is the best institutional structure to preserve the independence
and integrity of the BBC and we will obviously look with interest
at what you have to say about that and about the role of Parliament
in this. We are looking at another dimension in this relationship,
which is how the BBC can build its accountability to licence fee
payers, its shareholders if you like and we are looking at a number
of modes of governance and a number of ways in which the regulation
of the BBC might give expression to this. Where we would agree
with the thrust of your argument is that this continued and explicit
accountability is important. Governments are not elected for 10
years without a break in the middle. This sense for the BBC that
it is under scrutiny and that its obligations to licence fee payers
are constantly under scrutiny is important. What we have to achieve
is a balance between this sense of uncertainty and turbulence
and accountability; that is the tension that we are grappling
with at the moment.
Q605 Chris Bryant: At the moment
one of the things the governors do is they are set objectives
or tasks every year and they have reduced their number from 30
down to 10 or so. I just wonder whether that job of setting the
annual targets should not be set by somebody outside the BBC,
for instance this Select Committee, the Department or Parliament
or whoever and then for the BBC governors to adjudicate against
that set of objectives. What do you think?
Tessa Jowell: I certainly think
that that is an idea worthy of consideration. I think my feeling
is that we want the BBC to be moved away from what is the perceived
influence of Government, that was actually a very interesting
but consistent piece of feedback from the consultation and that
within that by and large people support the idea of this relationship
between the BBC and the sovereign, but they were less keen on
the idea of a stronger relationship between the BBC and Parliament,
feeling that that could compromise the independence of the BBC.
You may well make some specific proposals on this which we will
obviously give proper consideration to, but I expect that the
debate about governance and accountability will be the debate
that will characterise this Charter review both at the time and
in retrospect.
Q606 Chris Bryant: Paddy Barwise
made the suggestion about the BBC3 and BBC4 that they should have
targets for audience share and reach. Do you think that is the
right route or does that leave you in a situation where the BBC,
contrary to the logic of the licence fee, is basically scrambling
for audiences? We have been trying to say that audience figures
are not the only things that matter.
Tessa Jowell: For the reasons
that I set out earlier we would obviously want to avoid that because
if the BBC is only scrambling for audiences all the pressures
are towards the middle ground and away from the distinctiveness
of BBC4 and the distinctiveness that BBC3 is aspiring to.
Lord McIntosh of Haringey: I think
what we have got to guard against all the time is the idea that
a public service broadcasting obligation can be defined as dealing
with market failure. You really have to have a public service
broadcasting obligation which covers the full range of quality
programming that people want in all genres rather than picking
up the pieces and that is why plurality of public service broadcasting
is so important.
Q607 Chris Bryant: Is not one of
the dangers about a very large BBC, and it does get a large amount
of money, it is going to get another £320 million over the
next few years simply by virtue of the fact that there are more
single person homes, that it becomes such a monolith that it is
very difficult to get a plurality of voices, whether you are talking
about regional accents and different coloured faces and different
perceptions of the way Britain is through that monolith? Is that
a problem?
Tessa Jowell: I think it is a
risk.
Lord McIntosh of Haringey: It
is an opportunity too.
Tessa Jowell: I also think that
it is a risk which the BBC are addressing and something that we
are looking at in the Charter through recognising that they have
got to move substantial parts of the operation out of London for
precisely that reason.
Q608 Chris Bryant: Would a bigger
independent production quota help that?
Tessa Jowell: I think that could
well, yes. As I have often said, I see the licence fee as venture
capital for the nation's creativity and I think that the BBC investment
in the independent sector is not only good for working but it
is good for the state of that particular and very important part
of the creative industries more generally.
Q609 Rosemary McKenna: The Chairman
mentioned children's digital television earlier and that it is
a very good example of where the BBC has a very important role
to play. If you look at the vast majority of digital children's
programming, it is Disney and all of that genre, which is fine,
but BBC Digital actually provides quality programming which I
know lots of parents and educators value and I think that shows
how important it is that they should be in there doing that. However,
the Chairman and the Chief Executive are saying at the moment
that they want to look very carefully at the core purpose of the
BBC and what it ought to be providing. If they do that and they
decide that something is not working and it is not their core
purpose, how can they deal with that? Can you provide something
in the Charter review that will say that it is appropriate for
them to remove some kind of programming that they are providing,
because it seems to me that that is something that would be extremely
difficult for them to do? Once an area of broadcasting is provided,
how can you remove that without there being this major uproar
that happens in this country every time there is some change?
Tessa Jowell: I would certainly
see children's broadcasting as part of the BBC's core purpose.
Paddy Barwise's report makes the case for children's broadcasting
through the BBC very clearly indeed, the assurance of quality,
no advertisements and so forth. I think CBBC was described as
a triumph which has not undermined the preschool programming on
BBC1 and BBC2, so its offer is distinctive. He praised CBBC, but
I do not think he liked young people sticking their tongues out
and some of the language was a bit rich for him, nonetheless he
recognised that this was a justifiable part of the BBC's remit.
I think that in a way children's broadcasting is the easy part
of the answer to your question, there is not a huge dispute about
that. I think what is more difficult is the role of religious
broadcasting on the BBC, the role of arts coverage for instance,
those areas of the genre range for which there will not continue
to be enormous audiences and this is an important point that came
up in the course of the consultation. Even though people do not
want them, they like to know they are there. That would be my
answer to those who say that if nobody is watching them then the
range should be shut down. Once you start reducing the BBC's range
then you risk the BBC becoming a broadcaster like any other.
Q610 Rosemary McKenna: Let us take
BBC News 24 which people criticise for its cost in comparison
to the number of viewers that they have. If the BBC decided as
part of the review that BBC News 24 was unnecessary and they were
not getting the audience share or whatever, can they make that
choice? Is it part of the renewal to say that that would be a
choice open to them, to say we are not going to go into 24 hour
news broadcasting?
Tessa Jowell: Within the present
structure the most draconian step I could take where it was established
through independent review that the BBC had not complied with
the conditions that were attached to a news service would be to
say that it should be discontinued.
Q611 Rosemary McKenna: It is said
that the public sector broadcaster should be a risk taker in all
sorts of areas, music, radio, everything, they should always be
able to take risks and try something new. I think the problem
arises if they then try to say it does not work. How do they get
out of that? How can they remove that without creating the huge
campaign to save something that is clearly not working?
Lord McIntosh of Haringey: Surely
the two go together. If you are encouraging the BBC to take risks,
that is why it has long-term funding rather than year-by-year
funding, then they are going to make mistakes and they are going
to have to have the power to correct them and the role of the
BBC governors in their non-executive director rather than their
regulatory role is precisely to make sure that they do react appropriately.
If you try and make any change on Radio 4 there are hundreds of
thousands of people who will scream about it, but they have to
be prepared to do that.
Tessa Jowell: I think there are
a number of ways of addressing this. One is having very clear
expectations attached to different services, so you have a degree
of transparency against which the public assessment, not just
the rather private process between the BBC and the Secretary of
State, can actually be conducted. There is, of course, the experience
where BBC Choice and BBC Knowledge came from. BBC3 and BBC4 actually
arose because BBC Choice and BBC Knowledge were not regarded to
have been successful. That was a judgment that was made by the
BBC. Had the Charter review coincided with that period of realisation
that these were not working, would the Charter review process
have addressed them? I suspect that probably it would have done.
Michael Grade's suggestion about service licences, which is a
way of capturing the expectation of a particular channel and capturing
the standards by which the effectiveness of a channel can be judged,
is a very good way through this. It slightly begs the point as
to how those standards are reached and to what extent there is
some kind of involvement of licence fee payers in helping to shape
the process of individual channel identity, but I think that that
is a discipline. In a sense we have moved ahead in effectively
setting a service licence for BBC3 as a condition of approving
it. I welcome the fact that the BBC have now seen this as a model
which could be applied to other channels as well and I think that
that will answer some of the questions that you are expressing.
Q612 Rosemary McKenna: Is it part
of the Charter renewal that they should do more in terms of public
consultation? I know they invite people in from the regions. I
think they should do a lot more of that.
Tessa Jowell: I absolutely agree
with you. One of the problems of the present arrangement is that
there is this great flurry of activity round about the period
of Charter review and suddenly more of the kind of programming
that everybody thinks the BBC is about appears to be put back
into the schedules. I think that the BBC need to have a continuing
conversation with the people who pay for it and for that not to
be something which is focused on the period of Charter review.
How you keep that process fresh and stop it becoming a sort of
box ticking exercise is quite a challenge, but I think it is an
important one for them.
Q613 Mr Doran: That last suggestion
suggests that it might be a good idea to have a permanent Charter
review.
Lord McIntosh of Haringey: Trotskyism!
Q614 Mr Doran: I am not sure we should
get into a debate about that. One of the things we are trying
to do on this Committee is to look ahead and to see how the landscape
of broadcasting is going to change and obviously we are living
through a period when there is substantial change afoot. New technology
is providing consumers with a choice which they have never had
before. On some of the visits that we have made we have heard
some staggering assessments of just how things might change. As
this is a review which potentially will last until 2016 or 2017,
can you say a little about the assessments that the Department
is making about the way the landscape will change through the
life of this Charter?
Lord McIntosh of Haringey: That
is futurology with a vengeance, is it not? It is difficult enough
to say whether the start of the Charter review period will be
the same broadcasting landscape as now let alone two or three
years away and to start to make estimates of what it will be 12
years away in 2016, if that is the period that we adopt, is even
more difficult. I think the challenge to us is not to estimate
the speed at which in particular convergence will happen, it will
happen and the distinction between broadcasting and telecommunications
will gradually diminish, but to make sure that we have a Charter
which is robust enough to deal with that. I think the great advantage
that we have in this country of having a BBC which is not only
independent of Government but also has historically maintained
an astonishingly high audience share for public sector broadcasting
is a very good augury for our ability to manage convergence and
yet not to lose the standards that we value.
Q615 Mr Doran: Some of the evidence
we have had says that that is unlikely to be the situation in
the future, even the near future. One of the people that we have
met, an American analyst (and this was backed up by others) was
quite clear that the future of broadcasting has to change because
the consumer is becoming more and more in control because of the
technology and the ability that the consumer now has not simply
to sit there and be forced to watch a programme but to choose
if he or she watches a programme and the form in which he or she
watches it. We have heard all sorts of assessments that public
sector broadcasting and broadcasting as we know it, whether it
is digital or analogue, could reduce and become a niche market
and a niche market at the low end of the market.
Lord McIntosh of Haringey: That
was the distinction that the Secretary of State was making half
an hour ago. There is the potential for technological change,
the potential for convergence, and nobody denies that that is
proceeding apace, but the distinction that the Secretary of State
was making was the speed at which consumer take-up of it exists.
It is certainly true that over a long period of time people will
be more likely to take up the new opportunities which technology
provides. It is also true that a very large number of people,
perhaps not the youngest people but a large number of people,
are going to stick to the comfort of the broadcasting that they
know and are going to stick to the existing five terrestrial channels.
I think a lot of the forecasts of the decline of those channels
and therefore of their viability in terms of advertising or in
terms of justification for the licence fee are, shall we say,
excessive.
Q616 Mr Doran: So in 2016 you think
we may have a landscape which is similar to what we have at the
moment, still with a strong terrestrial broadcaster?
Lord McIntosh of Haringey: We
will have a lot of convergence. We will have a lot of people,
market-led, who will be taking advantage of the huge new opportunities
which will be available. In addition we will still have a lot
of people behaving as they behave today.
Q617 Chairman: How do you know? And
what is "a lot"? If you have, as I take it you have,
been doing the kind of research that we have been doing in this
Charter review, you will know that by 2016, to take that particular
date that we have been concentrating on, the variety of ways of
receiving audio-visual entertainment will be such that sitting
down and watching a continuous stream of entertainment supplied
to you by television channels will not be the way that most people
are receiving television and is not the way already that 15-24
year-olds are receiving television. That being so, and that what
people are already doing to a considerable extent but, as Frank
Doran points out, are going to do to a very much greater, perhaps
almost exponentially greater extent in a dozen years' time, will
inevitably mean that, whatever the virtues or otherwise of the
BBC, its proportion of the audience may well have fallen a very
great deal in the sense of doling out the kind of entertainment
that we used to accept as given. At what point does the BBC's
share of the audience fall to a level where a licence fee as a
way of funding the BBC is no longer justified?
Lord McIntosh of Haringey: I have
two comments on that, Chairman. First of all, you have been receiving
a lot of evidence about this and therefore you are particularly
well informed and you are collectively up to date but I think
you will acknowledge that the futurologists do not agree about
these matters and that there are very significant differences
of view between them about the speed at which this takes place
and the degree to which it will have taken place at the end of
a new putative ten-year Charter review period. The second comment
I would make is that in responding to Mr Doran I very specifically
did not say that linear viewership of the kind that we have now
where we accept the time slots which are given to us by the broadcaster
will continue to be anything like as important as it is now.
Q618 Mr Doran: One of the other important
pieces of information that we have taken on board is that the
content producers will be king in the future when we have a range
of broadcast options and receiving options available to consumers.
Potentially, given its back catalogue and its ability to make
programmes, we could see an even more powerful BBC, one which
is obviously receiving money from the taxpayer through the licence
fee and in addition to that will have a library which will be
potentially the envy of the world in the programmes it is able
to sell, which could skew its relationship with the commercial
broadcasting industry even more than it is skewed at present.
Is that an issue that you have addressed and do you see the potential
for that and, if you do, will you have any remedies for dealing
with it?
Lord McIntosh of Haringey: We
have certainly had a lot of evidence on this point. You have been
listening to Peter Bazalgette, I guess, on some of these things
but yes, certainly this has been a significant element, not just
in our public consultation but also in the seminars which Terry
Burns has been running and it is part of our consideration.
Q619 Mr Doran: On the relationship
between the BBC and the rest of the broadcasting industry there
are a couple of points I would like to make. We met Ofcom last
week and there were two points that concerned me about their evidence.
One was, in the context of the public sector service broadcasting
requirement, the position of film. I have to say I was a wee bit
surprised that when I asked questions on this it did not seem
to figure at all on the Ofcom landscape. I would be interested
to know just where DCMS sees the role of film. The context in
which I asked the question was the pretty appalling record which
television generally in the UK has, including the BBC, of showing
recent British films. We seem to go for third-rate American films
which are very cheap rather than our home produced product, something
which people would argue is a key point of our culture.
Tessa Jowell: To take your second
point first, we would largely agree with you on that. Secondly,
we welcome the fact that we have seen since 2000 an increase
in what the BBC spends on UK acquisitions. The figure was £1.75
million in 2000. It will be £4.75 million—
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