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“high wage costs across the corporation need to be addressed”.
It is clearly not up to Ministers to interfere in the pay of presenters, but it is essential that the BBC management justify to licence fee payers the money that they spend. If the Minister believes, as his Secretary of State clearly does, that there should now be transparency in what the BBC pays its presenters, he will get cross-party support. So will he confirm the briefings to the newspapers, and get on with putting them into practice?
There is huge support among the public for the BBC, but an unacceptably high licence fee will surely undermine that support. Does the Minister not accept that a settlement in excess of £180 will simply be too high for many families on low incomes? We must ensure that we get the best deal possible for the licence-fee payer.
Chris Bryant (Rhondda) (Lab): Would the hon. Gentleman like to comment on the fact that although many people think the licence fee a good thing, they are not convinced of that when they are unable to get the same deal from the BBC as those in many other parts of the country? In my constituency, one can get the full range of BBC services only by paying Rupert Murdoch some money for a Sky box. Does the hon. Gentleman believe that it is time the BBC pressed ahead with its Freesat option, which was promised a year ago but still seems not to be on the cards?
Mr. Swire: The hon. Gentleman makes his customary point, and it is a very good one. The BBC is striving to achieve universal coverage, and although it is doing a good job in that regard, it can never achieve it. It is important not only that people have a fair and transparent licence fee, but that there is as much parity as possible between what they can access—so on the whole, I tend to agree with the hon. Gentleman.
Can the Minister not see the good sense in allowing the NAO to provide full and transparent scrutiny of the spending of licence fee payers’ money? As I said, it
plays an important role in bringing about a culture of efficiency and value for money. Should it not have a role in safeguarding the use of £4 billion-worth of public money?
It is important to recognise the BBC’s impact in the media world—
Mr. Don Foster (Bath) (LD): Does the hon. Gentleman not agree that the NAO can play another crucial role at this very difficult time? As has been pointed out, there are conflicting claims about the BBC’s proposed licence fee increase. If the NAO could look at those figures and the various independent reports, that would help all Members of this House to come to a conclusion.
Mr. Swire: That is precisely right: if the NAO had been involved at an earlier stage, I suspect that we would not have needed this debate today.
Mr. Leigh: That is an important point. It will be said that we must preserve the BBC’s editorial independence, which is absolutely right. It has also been said that the public do not want politicians interfering with the BBC, but that is not what we are talking about with regard to NAO involvement. The World Service has had the NAO looking at its books since its inception, and no one has ever suggested that the NAO has any impact on editorial independence. That is a red herring.
Mr. Swire: Again, my hon. Friend is entirely right. The NAO has examined the World Service’s books for many years, and it is increasingly able, almost by invitation, to examine some of the BBC’s books. But the 30 per cent. of people questioned who expressed dissatisfaction with the BBC might be more inclined to express some satisfaction if they knew that there was full and transparent accounting of where the money is going and what, at the end of the day, they are being invited to pay for.
The BBC has established a worldwide reputation for excellence, but that does not mean that it should be involved in every possible area of media activity.
Mr. Jim Devine (Livingston) (Lab): Will the hon. Gentleman give way?
Mr. Swire: If I may, I will make some progress.
I accept that the public gain a benefit from the BBC’s involvement in the promotion of new technology, but we cannot ignore the possibility that, given its almighty spending power and commercial weight, it will stifle competitors and make it untenable for others to be profitable in newly emerging markets. If the licence fee is excessive and the measures put in place by the BBC Trust are insufficient, the potential for markets to be distorted and innovation prevented is obvious.
The recent Beethoven downloads exercise saw the BBC make available 1 million free downloads, with a value of £8 million in the marketplace. If repeated, that could severely damage the commercial market. The BBC has already outlined ambitions to establish online communities, blogs and open access, and to become
“the premier destination for unsigned bands and to seize the opportunities of broadband, podcasting and mobile”.
We are told that the trust and the advisory powers of Ofcom are sufficient to prevent the BBC from crowding out competition, yet the Ofcom role is purely advisory and can be ignored. We hope that that will not happen, but it is none the less concerning to hear Mark Thompson, Director General of the BBC, say:
“The BBC is the only European brand that could take on Google and AOL”.
He is clearly a man with ambition, but should that be the ambition of Britain’s public service broadcaster? What message does that send to all the little guys in the world of technology—let alone the big ones—about the BBC’s intentions?
Mr. Julian Brazier (Canterbury) (Con): Does my hon. Friend agree with the proprietor of the Kent Messenger Group? He wrote to me saying the following about web services:
“The danger is that instead of a robust local market developing with a number of local content providers, or facilitators, the BBC will be one of a very few UK players, funded as it is by the licence fee...None of the commercial media companies are against competition, if it is fair competition...However, it seems unfair if the opposition is funded by statute to the tune of approximately £89 million a year from Kent alone.”
Mr. Swire: That sentiment is echoed throughout the country, as hon. Members are only too aware. That is why we are suggesting that Ofcom should have a beefed-up role, and that the task should not be left to the trust, with Ofcom in an almost advisory capacity.
Greg Clark (Tunbridge Wells) (Con): Has my hon. Friend had time to look at the online streamed regional news coverage from the BBC, and to compare that with what ITV offers? If he does so, he will see that the ITV offering is vastly superior, and that the BBC regional news broadcast online is primitive—despite the fact that many millions of pounds of taxpayers’ money are going into the BBC product. Does that not exemplify the need for caution in agreeing to greater sums for digital services?
Mr. Swire: Caution would be a good watchword, with the ever-changing technology and the pace at which that technology is coming on stream. We need to ensure that we do not allow the BBC to spend tens of millions of pounds of taxpayers’ money on technology which is not competitive, not innovative or out of date by the time it is introduced.
With that in mind, I raise the issue of the sole service licence for the wide range of content and services made available through the bbc.co.uk domain. Everything from news online, as my hon. Friend the Member for Tunbridge Wells (Greg Clark) mentioned, to podcasting, video on demand, the BBC’s new i-player, the proposed Ultra local television, and even plans to broadcast news to mobile phones, is subject to one single licence, although each will have to undergo the public value test. Does the Minister agree that the scale of the BBC’s online services is now so considerable that it is increasingly absurd to group them together under one service licence?
Returning to the subject of public service broadcasting, does the Minister agree with his colleague Lord Bragg, who said in the debate in the other place last week that ITV had been “hung out to dry”? Why are we currently debating the public service broadcasting role of the BBC and the public service requirement for Channel 4 in 2007, but not looking at the role of ITV, another key PSB provider, until 2012? Why, when we all agree about the need for plurality in the provision of PSB, have the Government singularly failed to consider PSB in the round?
That brings me to the topic of digital switchover. On the plus side, we have a Minister whose knowledge of switching over is second to none, yet on the minus side we are still in the dark about the final costs of switchover.
The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr. David Lammy): That was very poor.
Mr. Swire: The hon. Gentleman says that the Under-Secretary of State for Culture, Media and Sport, the hon. Member for St. Helens, South (Mr. Woodward) is very poor. He is not. If that is poverty, bring on poverty.
We are two years away from turning off the analogue spectrum, yet we still have no idea about the costs of targeted help for the vulnerable, which the director-general of the BBC thinks could cost
“the far side of a billion”.
Can the Minister confirm that we will have a final figure for this assistance before any licence fee settlement is announced? If not, we will be writing a blank cheque.
I have touched on only a few of our concerns about the BBC’s demands for a £4 billion a year settlement. We remain concerned about the process, the impact of an over-generous settlement on the media industry, the problems of an over-funded BBC crowding out the little guy, and the desire of the BBC to enter every new market. We are unconvinced by the submissions, and we believe that we must have clarity about the figures. The debate will show the desire in Parliament to ensure that we have a strong and innovative BBC fit to meet its unique responsibilities in a rapidly changing and competitive environment. I commend the motion to the House.
1.3 pm
The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr. Shaun Woodward): I beg to move, To leave out from “public” in line 3 to the end of the Question, and to add instead thereof:
“notes that the decision on the next licence fee settlement will represent best value and be announced in good time to take effect before the current settlement expires in April 2007; further notes that the decision-making process has been one of unprecedented public consultation and transparency and that the settlement should ensure a strong and independent BBC; further notes that the costs of switchover will be one of the considerations in setting the level of the licence fee; welcomes the strengthening of the arrangements for the National Audit Office’s involvement with the BBC; and recognises that changes to the level of the licence fee are subject to Parliamentary scrutiny by the negative resolution procedure.”.
The hon. Member for East Devon (Mr. Swire) is right. I am a switcher, but just as we are switching off analogue in 2012, I hope that we will by then have switched off the Conservative party, too.
I was extremely pleased to hear one thing from the hon. Gentleman—that he was glad to be able to support the future of the BBC. However, like a child picking a daisy and proceeding to pull every petal off until there was nothing left, he and his hon. Friends proceeded to attack it, describing it in terms of poll taxes and stealth taxes and as being over-funded. He asked us not to interfere, then asked us to interfere in the pay of presenters. As always, one contradiction followed another.
It may be helpful if I bring some appropriate clarity to what is really happening, as opposed to the caricature presented by the hon. Gentleman, and by the leader of his party in a recent speech to the Newspaper Society, with regard to what the BBC is doing and what we are doing in the review of the charter and the settlement of the licence fee.
The review of the BBC charter has been conducted against a background of unprecedented public consultation. From the beginning of the review at the end of 2003, we were determined that it would be the most comprehensive and open process in the history of the BBC. For the benefit of hon. Members, and to help the hon. Member for East Devon, I remind him that we have so far held three major public consultations, with more than 10,000 respondents. We have run a comprehensive research programme, inviting further responses from the public. We have held regional tours, seminars, webcasts and public meetings. During the review there have been four Select Committee reports and several parliamentary debates in both Houses. In addition, we have produced a Green Paper, a White Paper and two draft charters and agreements.
The purpose was clear from the beginning and it remains our guiding principle to deliver the strong and independent BBC that the public want. We recognise that the BBC has a unique place in the esteem and affection of the nation. It is one of the most trusted public institutions in the country, and it is an institution with which we have all grown up. In today’s debate, let us try not to play politics with the BBC. Let us recognise the role that we believe the public want the BBC to play for the future. If we get that right, we will do the right thing not just for ourselves and our respective parties, but for the public.
Mr. Greg Hands (Hammersmith and Fulham) (Con): The BBC is the largest employer in my constituency. The representations that I receive from staff show that although they are appreciative of the consultation process, they are looking for a decision and for clarity with respect to oversight and funding. Why have those key decisions been postponed? That is not good for morale in the BBC. The Minister would have the support of key staff in the BBC if he brought about some accelerated decision making.
Mr. Woodward: I shall come to the reasons for that in a moment.
Mr. Don Foster: The Minister rightly claims credit for the wide consultation that has taken place. Consultation is all very well, but what matters is whether the Government listen. Does he acknowledge that the vast majority of respondents have expressed grave concern about the proposals for the governance of the BBC? Is it not the case that the Government have so far refused to listen to any of them?
Mr. Woodward: I am grateful for the hon. Gentleman’s acknowledgement that we have undertaken a large-scale consultation exercise, but I do not agree with his conclusions. I will deal later with the governors and the trust.
Chris Bryant: I wholeheartedly agree with my hon. Friend that we need a strong BBC and that we should not fetter it so much that it is unable to flourish in future generations. Britain would sadly miss the BBC. However, in some areas, particularly in commercial radio, there are legitimate concerns about the overweening power of the BBC, as reflected in Radio 1 and Radio 2, both of which I enjoy listening to. I wonder whether the BBC sometimes crowds others out of the marketplace.
Mr. Woodward: The BBC, of course, engages in new media and new technology. People who are being asked to pay a licence fee would expect that. The questions that my hon. Friend raises are dealt with in the finalised version of the charter, which we will very shortly publish for the House. None the less, I take on board the points that he makes.
Mr. Graham Brady (Altrincham and Sale, West) (Con): Does the Minister agree that if the BBC is to continue to have national support, it is essential that it should not be too concentrated in London and the south? Will he use his good offices to try to ensure that the planned move of production to Manchester goes ahead as quickly, as smoothly and as comprehensively as possible?
Mr. Woodward: I fully recognise the hon. Gentleman’s point. He is an excellent constituency MP in the north-west, and I know how strongly he has lobbied. I am sure that he will have been pleased by last week’s announcement by the governors. In the course of my remarks, I will discuss the proposed move to Greater Manchester—specifically, Salford media city.
Whatever partisan view we may take in the course of a parliamentary debate, we should put on the record the fact that hon. Members on both sides of the House think that the BBC epitomises the best of what the nation has to offer in service industries. It commands respect around the world—indeed, it sells its programmes around the world—and has endured and evolved in the context of a vibrant, dynamic commercial sector. We should pay close attention to the charter review and involve the public because we are, after all, setting the direction of the BBC, which will inform the direction of the market for the next 10 years. We must get it right, and that includes the licence fee.
Dr. Tony Wright (Cannock Chase) (Lab): Will my hon. Friend directly address the crowding-out argument? The BBC crowds out the bad, the inferior and the second rate, which is exactly the kind of crowding out that we want.
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