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A further ask has emerged since the licence fee settlement was reached, and it is perhaps the most important of all. The media industry has changed profoundly during that time and continues to change at great speed. As a result, and as I have said before, it is vital that the BBC step forward to play a bigger role as a partner and an enabler of other public service content, and I welcome the moves it has made in this direction. This is firmly in the public interest, as it helps to sustain programmes that the public value. According to the hon. Member for South-West Surrey’s logic, if commercial TV is shrinking, the BBC must shrink too. My argument is that the BBC should put a helping hand under other parts of the system that are struggling, so as to maintain the content that the public enjoy, value and depend on. That is the fundamental misunderstanding in his remarks today.
Andy Burnham: I have given way to the hon. Member for Stone (Mr. Cash) once already, and I want to make some progress. I will give way to some of his hon. Friends before I finish.
All four of these major undertakings—digital switchover, the move to Salford, programmes in the nations, and the BBC as partner—would be destabilised by this ill-conceived Tory attack. At a time when our commercial broadcasters are facing economic difficulties, this work only serves to underline the importance of a properly funded BBC as the backbone of our creative economy and the cornerstone of public service broadcasting. Two months ago, we saw a prime example of this with the memorandum of understanding between the BBC and ITV plc to enter into news gathering and production partnerships that will deliver cost savings rising to an estimated £7 million by 2016 in the provision of regional news in England and Wales on ITV.
Mr. Redwood: The Secretary of State says that the BBC makes provision for the nations and regions, but when will he and the BBC understand that England is a country and that it wishes to be recognised?
David Cairns: What country does he think Salford is in?
Andy Burnham: I do not know how often the right hon. Gentleman travels north of Watford, but I can tell him that Salford, which is most certainly in England, is about to benefit from a major investment in the creative economy of the north-west. If the right hon. Gentleman paid us in the north a visit once or twice, he might learn something.
Mr. Redwood: The right hon. Gentleman is deliberately misconstruing what I said. The point is that in its content and production the BBC does not recognise England; it balkanises us into regions, which people do not like.
Andy Burnham: The right hon. Gentleman has made his point and there is no need to reply to it. I shall begin to conclude my remarks.
In recent years, we have seen how central the BBC is to this country’s global prominence in innovation in the creative sector. The iPlayer has been a phenomenal success—one that we need to see replicated and its benefits shared across the creative sector as a whole. We cannot expect the BBC to play that role unless it has stability and certainty at its core.
Mr. Stuart: I am extremely grateful to the Secretary of State, who is being most kind in finally giving way to me. He keeps saying that the BBC must have certainty in order to develop its offerings for the future, but I put it to him that the commercial sector—whether it be publishing, which competes, or broadcasting—has to make do with the income that comes its way. It is coping with greatly reduced incomes at the moment, yet it sees the BBC being given absolute guarantees, which is a monopoly being solidified. That is why my hon. Friend the Member for South-West Surrey (Mr. Hunt) is right to suggest that the BBC should share the pain with the rest of the British economy.
Andy Burnham: The BBC fulfils a different role; it is not a commercial broadcaster. It is there to provide content that the commercial sector would not provide. It is there to invest in new and emerging talent and to take risks on different types of content. It is there to provide local radio of a depth and quality that the commercial sector could never reach.
Mr. Stuart: On a point of order, Madam Deputy Speaker. I apologise for failing to declare an interest. As a director and shareholder in a publishing company, I feel that it would be right for me to do so.
Madam Deputy Speaker: The hon. Gentleman’s comments will now be on the record.
Andy Burnham: I am glad they are.
To conclude, let us be clear what today’s debate is about. It is about posturing and getting easy and cheap headlines for the Conservative party. It is traditional BBC bashing—yes, it may have been done with a light touch, a smile and no tie, but it is BBC bashing none the less.
Madam Deputy Speaker: Order. It is obvious that the Secretary of State is no longer prepared to give way.
Andy Burnham: When in January 2007, my right hon. Friend the Member for Dulwich and West Norwood introduced the BBC settlement that we are debating today, she introduced a fair, realistic and well thought through settlement. She did so in order to provide a platform of stability and strength in a period of flux and change, and she did so on the basis of the best possible combination of independent advice, high-quality research and public debate. It was a settlement with a vision for the future of the BBC and its role. Now is not the time to rip up that settlement or to be thinking of taking money out of the system and risk destabilising not just the BBC, but our creative sector as a whole.
Andy Burnham: I will give way one last time, but then I am going to finish.
Mr. Hunt: The Secretary of State described our motion as an ill-conceived Tory attack, so can he tell me why early-day motion 1047, which asks for a freeze in the licence fee, was signed by more hon. Members from his own party than by Conservative Members?
Andy Burnham: The hon. Gentleman has brought a motion before the House today and he is asking us to vote on the licence fee. He is a member of the Tory Front-Bench team, so he represents Conservative party policy. I suggest that when a Conservative Front-Bench Member brings such a motion before the House, it indicates to those outside precisely how he and his Front-Bench colleagues think. I say again that this is an attack on the BBC led by the Leader of the Opposition, and which the hon. Gentleman has had to carry out today. I can see his discomfort in having to do so.
The licence fee is an investment in Britain’s digital future. It is bringing jobs to the north-west, programme making to the regions and nations, and building our digital infrastructure. It is the prime source of investment in one of Britain’s abiding strengths—our creativity. Given a choice of investment or cuts, we know where the Tory party usually stands. I urge the House to vote against the motion.
Madam Deputy Speaker: Order. Mr. Speaker imposed a 12-minute limit on Back-Bench speeches. So that I can—I hope—accommodate everyone who wishes to speak, I shall now reduce the limit to seven minutes.
5.25 pm
Mr. Don Foster (Bath) (LD): For once, I am delighted to follow the Secretary of State.
In my view, the Tory proposal is a dangerous, badly timed and, frankly, pathetic gimmick. Although, as the Secretary of State has said, the BBC is rightly the envy of the world, the whole House would acknowledge that it does not always get it right. I have been very critical of a number of its actions, which in recent times have included the aggressive approach to licence fee collection, the slow reaction of management over the Ross-Brand affair, the phone-in scandals, the excessive expenditure on taxis, aeroplanes and even Christmas parties, and the over-the-top payments to some presenters and so-called top talent. Despite that, however, I value the BBC and I value the values for which it stands.
Introducing the debate, the hon. Member for South-West Surrey (Mr. Hunt) said that it had come at a time when there was a huge debate about trust in politicians. He is right, but let me remind him that trust in the BBC has never been greater. A recent poll by the BBC Trust showed that 85 per cent. of the British people support the BBC, up from 70 per cent. two years ago. I think that we obtain phenomenally good value from the BBC. For 39p a day, licence-holding households receive 10 TV channels, some with high definition, 10 UK-wide radio stations, 46 national and regional radio services, interactive services on BBCi, the huge benefits of the iPlayer and,
in bbc.co.uk, a website that gets 17.5 million unique hits every week. I think that that is pretty good value for money. The BBC also provides high-quality, UK-produced, impartial broadcast content. I believe that it is vital to our democracy, to our sense of national identity, and to the success of our creative industries.
Last night, in an interesting and somewhat provocative speech, the chairman of the BBC Trust, Sir Michael Lyons, argued that the way in which people think about the BBC is different from the way in which they think about commodities. The hon. Gentleman’s approach seems to be that they just think about commodities, but they do not. As Sir Michael said, the British people see themselves as shareholders in the BBC, and therefore have a vested interest in its long-term future. The Tory proposal ignores that relationship, and crucially—as the Secretary of State said—it ignores the vital independence of the BBC from Government.
As we have heard, the planned increase is part of a six-year settlement. Not only is the length of that settlement critical to the BBC’s ability to plan ahead, but it underpins the BBC’s editorial independence. Voting against the order and for the Tory proposal would set a dangerous precedent whereby the licence fee settlement could be redrawn each year, year on year—as the Tories’ leader has said—according to political whim. It would represent a fundamental and undesirable shift in the relationship between the BBC and Parliament. In short, the motion is highly dangerous, and prompts the question “Will the BBC, and especially its independence, be safe in Conservative hands?”
It is no wonder that, on Monday this week, The Guardian quoted an unnamed Tory source as saying:
“This could be the first meaningful salvo in what could be an explosive battle between a Conservative government and the BBC.”
In the same article, the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale), the Chairman of the Select Committee on Culture, Media and Sport, is quoted as saying that today’s vote would “send a message” to the BBC. I look forward to hearing what message he thinks it will send.
Mr. Hunt: Can the hon. Gentleman explain why, if the Tory proposal is so dangerous, two members of his party’s Front Bench supported early-day motion 1047? It asks for a freeze in the licence fee, which is exactly what we are asking for today.
Mr. Foster: I suspect that we shall have to see whether, after those two hon. Members have read the Hansard report of the debate, their names remain attached to the early-day motion. However, I hope that I may be able to persuade the hon. Gentleman.
The hon. Gentleman thinks he has scored a point, but let us address what he has said. He has said that his proposal represents a £68 million cut in the BBC budget. I hope he will stand up and intervene on me to explain where that figure of £68 million comes from, because I have had it checked by the BBC finance department. It says that if it is a one-off cut, it will actually be £75 million, but, unless he is proposing that in subsequent years there be a way above inflation-busting increase to get the BBC back on track, the cumulative impact of his proposal will actually be a cut of £325 million.
Mr. Hunt: The hon. Gentleman asks me to suggest ways in which that £68 million can be found. We have talked about the taxi bill. What about the £108 million spent on imported programming, much of which could be viewed on the commercial channels if it was not being shown on the BBC?
Mr. Foster: I wish I had not given way to the hon. Gentleman because I asked him a clear question: where does his figure of £68 million come from, as it is incorrectly calculated? A one-off cut would be £75 million, and carried through to the end of the licence period the cut would amount to £325 million. A cut of that magnitude must be considered in the context of what is happening within the BBC. The Secretary of State has already referred to that, but we must recall that, since 2001, the BBC has already made cumulative savings of £2.2 billion, 7,200 posts have gone since 2005, and it already has plans in place for a further 15 per cent. of efficiency savings amounting to a cut of £1.9 billion by the end of the licence period, during which a further 1,200 posts will go. We also already know that pay and bonuses for senior managers have been frozen for 18 months, licence fee collection costs have been reduced by £32 million, and spending on top talent has been reduced—and the list goes on.
The hon. Gentleman said, however, that the BBC has to do what all other businesses have to do: cope with the impact of the recession. Because he has done his research, he should be aware that, in addition to all the planned cuts, the BBC now has to cope with a reduction in anticipated income because the number of new households is lower than was expected so there will be fewer new licences and because the money it will get from the sale of property in White City has massively reduced as a result of the impact of the recession on the property market. Those factors combined mean that the BBC has to find a further £400 million in cuts because of the recession.
The idea that the BBC is swimming in cash and can make additional savings at the drop of a hat is, therefore, out of date. It is unprepared for the retrospective cut that the Tories are asking for. The Tories have to say which services should be cut, too: local radio services, or the children’s channel, or the parliamentary channel, or a national radio station or two? Perhaps still more importantly, what damage would the cut do to the creative industries?
Mr. Foster: I will give way to the hon. Gentleman shortly, if he wishes to intervene then. We know that the BBC’s activities put £5 billion per annum into the creative industries. It has already been pointed out that the other broadcasters are reducing their expenditure. If there is a further BBC cut, that will have a direct impact on the creative economy.
This is a dangerous proposal that would undermine the independence of the BBC and that would, by failing to take into account recent and planned efficiency savings, put programmes and services at risk. It is also badly timed. This is a retrospective cut, and no mention has been made of the cost that would be incurred in implementing it retrospectively. Again, I have received advice, and I have been told it would be in the order of £4.3 million.
Finally, this really is pathetic, because if all the Tories can do in this recession is offer to each household in the land the princely sum of £3—less than 1p a day—people will see through that for what it is. The public do not want the BBC to be damaged or its independence to be threatened, and they will see this as a cheap gimmick. By using the BBC as a political football, the Tories have scored an own goal. It is absolutely clear that the BBC will not be safe in Conservative hands.
5.34 pm
Mr. John Grogan (Selby) (Lab): I have not signed the early-day motion in question, and I rise briefly to support the Government and oppose the Opposition motion. First, I wish to deal with the argument made by the Conservative Front-Bench team that advertising has declined for commercial broadcasters and thus, by implication, that the BBC is becoming too dominant in the market. It is important to be accurate with the figures. The amount of the licence fee money that is spent on BBC television programmes is about £2.5 billion, which is roughly what will be raised this year by the traditional terrestrial commercial broadcasters in advertising income—the ratio is about 50:50; the BBC’s figure could be a little higher than that of commercial broadcasters, or vice versa. Obviously, the BBC does not spend all its licence fee income on television, because it supports radio and online services too.
That argument from the Conservatives seemed to me to belong to 20 or 25 years ago, because it completely neglected the fact that a great deal of broadcasting income these days comes from subscription TV. I believe that BSkyB has a subscription income of about £3.7 billion, and the figure for Virgin—Richard Branson’s company—is about £600 million, so a total subscription income of well over £4 billion, in addition to the advertising income for commercial broadcasting, has to be considered. The BBC is a much smaller player than it was 10 or 20 years ago, and it is not in any danger of becoming dominant in the market. Indeed, 10 years ago, people were fearful as to whether the BBC would have relevance, given that competition. As Front Benchers have recognised, the BBC has responded well to that competition: BBC 1 remains the most watched TV channel in the nation; BBC radio still attracts about 50 per cent. of the radio listenership throughout the country; and BBC Online is looked at by at least half the population on a regular basis.
There are two reasons why it is important that the BBC’s licence fee is determined over a long period, not a short one—they have been mentioned but they are worth repeating even though they are both matters of common sense. I hope that in the coming days, or perhaps later today, the official Opposition will clarify whether they seek an annual review of the BBC’s licence fee, as some of their Back Benchers—
Mr. Grogan: I am encouraged by some of the gestures coming from those on the Opposition Front Bench suggesting that that is not the case, because it would be a big worry if it were.
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