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Daniel Kawczynski (Shrewsbury and Atcham) (Con): May I tell the Secretary of State that three British companies are drilling for gas off the coast of Mauritania and have found significant reserves of gas in that country? Will he agree to meet representatives of those companies? Does he agree that it is disappointing that we do not have an embassy in Mauritania? If we are to start exploring for gas in such countries, we need representation there.

Alan Johnson: I, or my hon. Friend the Minister for Energy, would be glad to meet the hon. Gentleman's constituents, although I am not so keen to go to Mauritania. His question about Britain having an embassy in Mauritania is more properly one for the Foreign and Commonwealth Office, which I am sure will consider it with interest.
 
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BBC White Paper

4.23 pm

The Secretary of State for Culture, Media and Sport (Tessa Jowell): With permission, Mr. Deputy Speaker, I should like to make a statement. I am today publishing a White Paper on the future of the BBC, entitled "A Public Service for All: the BBC in the Digital Age". It does exactly what that describes.

We live in an era of rapid change. In broadcasting, new technologies are leading to vastly more television and radio channels and to new media services. The BBC's charter, shortly due for renewal, needs to create a BBC strong enough to thrive in the new environment and flexible enough to adapt to new challenges. The BBC is a driving force to enrich our public realm. It is one of those institutions that brings the people of this country together as equals.

More than 70 per cent. of households now have digital television. As digital delivers ever more choice, there are some who describe the BBC as an anachronism. The Government disagree. More importantly, the British people disagree. Our unprecedented engagement with the people of this country in the development of the White Paper—more than 10,000 people wrote to us—has shown that people right across the country want a strong BBC that is independent of Government and is responsive to public wishes.

The Government hope that the new charter will give the public the BBC that they want. The Reithian principles—"inform, educate and entertain"—will be adapted for the digital age, but we will give audiences and competitors greater clarity about what that means in practice.

The BBC will have six new purposes: sustaining citizenship and civil society, promoting education, stimulating creativity, reflecting the identity of the UK's nations, regions and communities, bringing the world to the UK and the UK to the world and building digital Britain, where the BBC will act as a "trusted guide". There was strong public support for all those objectives, but licence fee payers also want to ensure that they get the BBC programmes that they want to watch and listen to, and they do not want an overdose of worthiness.

The White Paper makes entertainment central to the BBC's mission. The BBC should continue to take fun seriously, engraining entertainment into all its services, but the White Paper is not about writing the BBC a blank cheque or chasing ratings through copy-cat programming. It is about ensuring that the BBC delivers what licence fee payers want in terms of quality and distinctiveness.

The BBC's governance structure has become anachronistic, and the BBC needs a new form of accountability to licence fee payers, as the BBC's shareholders. Our new arrangements will make the BBC closer to the people who pay for it and more accountable to them. In a step change for the BBC's governance, we will abolish the BBC governors and replace them with two new bodies, the BBC Trust and a separate executive board.

The trust will be the licence fee payer's voice. It will act as a proxy for the BBC's shareholders, making it the first public interest body on that scale that the country
 
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has ever seen. The trust will oversee the executive board, whose own job will be to run the BBC's services. There will be clear separation of responsibilities between the trust and the executive board. Although the trust will be the sovereign body of the BBC—its word will be final—the new charter and agreement will prevent it from doing the executive board's job, which is critical to maintaining the objectivity required to generate and sustain public confidence. That is a unique solution for a unique organisation in unique circumstances.

An important part of getting the best programmes to the screen is competition for quality programmes. The White Paper requires the BBC to operate a commissioning system that encourages greater competition between in-house and independent producers but maintains the critical mass of in-house production. That new "window of creative competition" should result in the independent quota of 25 per cent. genuinely becoming a floor, not a ceiling.

I repeat our welcome in principle for the BBC's proposals to move a significant amount of production to Greater Manchester, helping to ensure that the licence fee is used as venture capital for the whole nation's creativity.

The BBC will continue as the cornerstone of public service broadcasting. We are equally committed to maintaining a dynamic commercial sector. That, too, is in the interests of the licence fee payer. In order to do that, we will put in place a triple-lock system to ensure the highest standards of accountability. First, the trust will issue licences to the executive board for running each BBC service. Secondly, BBC content will have to have distinctive characteristics, such as being original, of high quality, challenging or innovative—all supported by the consultation with licence fee payers. Thirdly, a public value test will be applied to all new BBC services or significant changes to existing services. In response to some concerns raised in the debate that followed the Green Paper, I am happy to clarify that whenever the trust carries out a public value test, Ofcom will provide the market impact assessment to guarantee rigour and ensure wider public confidence.

We will also put in place: a new duty on the trust to have regard to competition issues; ex ante codes in specific areas that have the potential to raise issues or concerns about competition; an overhauled fair trading regime; and a fair, transparent complaints system. The White Paper also confirms that the BBC will be fully licence fee funded for the period of the next charter. There will be future reviews into the scope for other methods of funding the BBC beyond 2016 and the possibility of distributing public funding, including licence fee money, beyond the BBC.

The process of deciding the next licence fee settlement has already started. Licence fee payers and industry will help to form our conclusions. The trust will need to make some tough decisions about how resources are allocated within the boundaries of the settlement. That will include self-help. To help the trust exercise stewardship of the licence fee, the relationship between the BBC and the National Audit Office will be strengthened within the existing arrangements.

Despite past predictions, public service broadcasting, led by the BBC, remains the bedrock of today's media, with strong public support. We are optimists about the
 
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future of the BBC, but it cannot take its position for granted. It must develop its role over the next 10 years, strengthening its accountability, bringing in new generations of viewers and listeners, and building a new consensus around the value of its place in Britain. The White Paper gives it the means to build that national consensus, with the authority and support of licence fee payers, and so I commend it to the House.

Mr. Hugo Swire (East Devon) (Con): First, may I thank the right hon. Lady for allowing me to have prior sight of both the White Paper and her statement? The wait was almost worth it, although I cannot quite see the difference between the Green Paper and the White Paper and we had to wait for the equivalent of the gestation period for an elephant to get the White Paper. I would be interested if the right hon. Lady would tell us where the differences are between one and the other.

The BBC is indeed a unique, much loved and much cherished institution and the Conservative party is committed to ensuring its future. Across the country and the world, the BBC stands out as a beacon of excellence. Our duty is to ensure that the BBC that we pass on to future generations is equipped to flourish in the decades ahead. Does the right hon. Lady not understand that to many the White Paper is such a disappointment? It singularly fails to rise to the challenge that the BBC faces. It was supposed to provide us with a springboard to the new digital age. But it is not so much a launching pad as a holding pen.

The White Paper is a huge missed opportunity for change and innovation. The Secretary of State has failed to grasp the challenges facing broadcasting in the 21st century. Digital television, broadband internet, podcasting and on-demand viewing are transforming the world in which the BBC operates and will change forever the future of public service television in Britain. In a fast-paced digital age, with people watching television on their mobile phones, iPods and laptops, and with the eclipse of the traditional television channel, is it credible to believe that a compulsory tax on the ownership of a television set is the right way to fund our national broadcaster for the next 10 years? Do not hon. Members accept that by failing to respond to those challenges, the Secretary of State has produced a White Paper that fails not only the BBC but the viewing public?

With an international reputation to uphold, it is vital that the BBC is bound by the highest standards of quality, impartiality and integrity. Does not the Secretary of State agree that the fine judgments that the BBC makes daily must be in the interests of the public, not Ministers and the Government? That is why the BBC needs a proper independent regulator. Why is it that Ofcom has the ability properly to regulate every other broadcaster in the UK, but not the BBC?

Those are not my words, but those of Michael Grade, the chairman of the governors of the BBC, when he was chief executive of Channel 4.

Is the BBC Trust proposed by the Secretary of State anything more than the BBC governors in another building—just as cosy, but twice the rent? If the BBC is to meet its public service broadcasting obligations, is it not essential that the British public have confidence in its
 
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independence and integrity? The Prime Minister may think that it is appropriate for him to act as judge and jury, but surely we cannot accept a model that fails to separate governance and regulation. Must not we have a system in place whereby those regulating the content, impartiality and standards of the BBC see themselves as representing the licence fee payer, not the Secretary of State?

The BBC is a unique organisation in a unique position. Because of that, we must ensure that that position is not abused to the detriment of other broadcasters or the viewing and listening public. Is it not unacceptable for a publicly funded BBC to be allowed to outspend and outgun its competitors, prevent innovation and stifle competition?

How can we be confident that the advisory role for Ofcom, as envisaged in the White Paper, will have the power to clip the wings of Auntie when she spies a lucrative potential market? Why can Ofcom do no more than send an advisory report to the BBC? That is not a criticism of Ofcom, just bewilderment at the way in which the Secretary of State is tying its hands. As long as the BBC has the ability to ignore Ofcom, as it does under the right hon. Lady's plans, it will continue unchecked and unrestrained. Will the right hon. Lady tell us whether Ofcom will be allowed to investigate the BBC's activities retrospectively? I doubt that. I suspect that Ofcom will not be a watchdog, but more the proverbial toothless tiger, and that we will be left with a typical new Labour initiative—a competition champion with only advisory powers.

Does the Secretary of State appreciate our concerns about her White Paper's suggestion that the BBC should be under a charter obligation to promote Britain abroad and to sustain citizenship and civil society? The Chancellor is already talking about his desire to see a flagpole in every garden. Is not there a danger that that will soon be followed by a Union jack flying from every TV aerial in the land? Jesting apart, does not such a move—at least in the hands of the Government, who are not known for their respect for independent institutions—represent an insidious threat to the BBC's impartiality? Surely the Secretary of State can see the dangers.

We are considering an unprecedented increase in funding for the BBC—from just under £3 billion a year to well over £4 billion in 2013. Why does the settlement require such an increase? Why are we faced with a bill for the BBC that is higher than the gross domestic product of Mongolia? Is it because of the grasping hand of the Chancellor? Are not the Government using charter renewal as a Trojan horse to pay for digital switchover? When there is a smell of easy money, the Chancellor is never far away, looking for ways of paying for policies that he cannot afford. Is it not the case that he is hellbent on trousering between £2 billion and £5 billion from flogging off the analogue spectrum? The licence fee payer will pay for that, but will not get anything back for the investment. Like the worst dinner date, the Chancellor is never around when the bill arrives.

We know that the Chancellor has form—he made £27 billion from the sell-off of the 3G network, and he is looking to repeat the exercise. Surely his ingenuity does not stop there. An example of the stealthiest of stealth
 
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taxes, he hopes that, by using the word "spectrum", the unsuspecting public will not realise that he has just imposed the first new Labour TV tax.

Like the computer salesman who bamboozles the customer with jargon, the Chancellor hopes that we will simply not notice another £300 million going from our pockets into his. Does not the Secretary of State accept that a licence fee that exceeds £180 will hit hardest the poorest in Britain—those on low and fixed incomes? Does not she agree that there is a danger that public confidence in the BBC, as a national institution, will be undermined by a licence fee that is set beyond many people's ability to pay, simply to feed the Chancellor's tax-and-spend habit?

We had high hopes of the White Paper because we had high hopes of the BBC. However, the document is a missed opportunity to introduce regulation to guarantee impartiality and independence. It is a missed opportunity to harness the potential of the digital age, to provide a level playing field for the commercial sector, to reinforce public confidence in the BBC and to give the BBC licence fee payers value for money.


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