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There are two reasons why the BBC needs long-term funding, the first of which relates to its independence, which should not be taken for granted. It has been
established over 80 years of BBC history and, as the Secretary of State said, it would be problem if the BBC director-general had to troop into the Treasury on an annual basis and, depending on what the controversy of the moment was, had to speak in the press, tailor his argument and so on. Would Jeremy Paxman be quite so aggressive to us all and would the “Today” programme be quite so pressing of the day’s issues if that were the situation? Over time, what would happen to that independence? It should be valued—there is no point in having the BBC and in having the licence fee if that independence is not preserved—because it is crucial, not only to news coverage, but to the BBC’s entire output.
Mr. John Whittingdale (Maldon and East Chelmsford) (Con): Is the hon. Gentleman suggesting that in the run-up to the previous BBC settlement, the BBC was, in some way, restrained in its criticism of the Government? I do not believe that his Front-Bench team would feel that that was the case at the time of Hutton.
Mr. Grogan: This is a question of balance, and of whether we should have the review once every six or seven years, or once a year. An annual review would clearly mean that the process is ongoing; there would never be a time when the BBC licence fee would not be under debate. We should be talking about relatively short periods, when the charter is reviewed, whereby we decide whether we want the BBC to continue or not, then decide what the licence fee should be and then let the BBC get on with doing its job.
We rightly make huge demands of the BBC, because of its privilege in getting the licence fee. Some of those have been mentioned, and they concern not only top quality content or maintaining standards. When the BBC falls short of those standards, it causes controversy because of the affection in which it is held. The demands also relate to how in this licence fee settlement, as has been said, we are asking the BBC to engage as never before with the nations and—as the right hon. Member for Wokingham (Mr. Redwood) has left, I believe that I can say this—with the regions of England too. The BBC is doing that in an unprecedented way. A third of BBC output will come from the regions by 2016, whereas only a quarter does so now. In Scotland, Northern Ireland and Wales, the figure will triple to some 17 or 18 per cent. of output. The partnerships that we are rightly demanding of the BBC—to advance digital radio, to preserve regional news and to get involved in all sorts of technological developments—mean that we have to ensure that it has a predictable income.
The last settlement was quite tough, and it has fallen below inflation for the last couple of years, as the Secretary of State said. The BBC has to cut its cloth according to its means, but it must have predictability.
This debate is a key indicator of the attitude of a future Conservative Government—should that ever come about—to many issues. Like the Secretary of State, on broadcasting I trust the instincts of the Conservative Front Bench and the Leader of the Opposition, who has often said that he admires the BBC as a great British institution, but those sentiments are clearly not shared by all Conservative Members.
Interestingly, it is not only on this issue that red meat is being offered. For example, I understand that it is now Conservative policy to get rid of the traditional British rule that television news should be impartial. We might end up with a domestic version of Fox News, and that would be a big change. If that were combined with calling in the director-general of the BBC once a year—I am glad that the Opposition Front-Bench spokesman has confirmed that that is not the plan, and I hope that it remains the case—broadcasting in this nation, which is valued by many people, could be under threat. That would affect not only the BBC, but commercial public service broadcasters and it would be to the detriment of the nation.
I hope that the House will endorse the current BBC licence fee and back the tremendous plans for production in the regions, top quality content and the development of new technology to which the BBC is committed.
5.42 pm
Mr. John Whittingdale (Maldon and East Chelmsford) (Con): I warmly congratulate my hon. Friend the Member for South-West Surrey (Mr. Hunt) on initiating this debate on the licence fee. If ever there was a time when it was right to ask again whether the licence fee should continue to increase, it is now. My hon. Friend set out some of the background to the increase in the fee against the rate of inflation, but the BBC’s income is determined not just by the level of the licence fee, but the number of households that pay it, which also has been going up. As a result, the BBC has enjoyed perpetual income increases, year on year, at a time when the rest of the media sector is facing its worst crisis for 50 years.
The media are affected by the recession in the same way as every other industry. As many people who have been in business will know, one of the first casualties in a recession is advertising spend, and there has been a significant drop in advertising expenditure across the board. On top of that, we are seeing a fundamental structural change in people’s consumption of media. More and more people consume media online, and as they move from traditional media outlets advertisers are following them. The result is that every commercial operator is under greater pressure than ever before. ITV has moved from children’s programming and regional programming, and it has now pulled out of arts programming with the ending of “The South Bank Show”. It has also cut drama. Channel 4 has identified a £150 million gap in its funding. Channel 5 is struggling to survive. Every commercial radio station is now considering its economic prospects and wondering whether it will still be in business in a year’s time. As we know, local newspapers are going out of business every week.
All those sectors face competition from the BBC, and that has always been a matter for concern, but the disparity between the amount available to commercial media and that available to the BBC has now become enormous, and it is distorting the market. For the first time, the BBC’s income will exceed the total advertising revenue of the entire commercial sector. That gap will grow to more than £1 billion.
Philip Davies:
Does my hon. Friend agree that, as opposed to the BBC press release masquerading as the Liberal Democrat spokesman’s speech, even if the motion were to be passed today, that would not comprise a cut
in BBC expenditure? The motion would simply result in the BBC’s not being given a further increase in funding. It is nothing to do with a cut to the BBC’s funding, anyway.
Mr. Whittingdale: My hon. Friend is absolutely right. The Conservatives are entirely familiar with the claim that there will be cuts when in fact we are talking about a slightly reduced increase in expenditure.
Andy Burnham: The hon. Gentleman is of course absolutely right to describe the pressure on established media businesses, but, given that, will the public get the quality of media they deserve if the licence fee is cut? How can the public in this country get the quality of media they deserve and that democracy needs if the licence fee is to be cut?
Mr. Whittingdale: We simply cannot ignore the environment in which the BBC is operating. That is not to say that the BBC does not do masses of things that are essential. However, my question is whether it needs £3.6 billion to do them. The BBC will always point to its comedy, drama, children’s television, regional television and its religion, arts and education coverage. However, just because the BBC produced “Cranford”, “Life in Cold Blood” or “Panorama” does not necessarily justify £3.6 billion. We have to ask whether we need all the channels that the BBC produces. BBC 3 has cost more than £500 million since it was set up, and to be honest I do not believe that the amount of product that has appeared on BBC 3 justifies that amount.
The Secretary of State said that “The BBC is there to provide content that the commercial sector would not”. I entirely agree, but too often the BBC is providing content that looks very similar, if not wholly identical, to the content that the commercial sector provides. One has to ask whether it is justified for the BBC to go on paying the amount that it does in recruiting talent, top salaries, competing against commercial providers and, as my hon. Friend the Member for South-West Surrey said, bidding against commercial television to acquire imported American television or to acquire Hollywood movies—in that case, the only beneficiaries are the Hollywood studios.
The BBC does not need all the money it receives and, in the longer term, we need to be having a bigger debate necessarily about whether the BBC needs this amount or that amount, but about how we can sustain public service broadcasting in this country. There is a desperate crisis, and it is essential that the BBC is not left as the sole provider of public service broadcasting. If we are to sustain plurality, we must support commercial providers’ continuing to provide public service programming. That might well need public support, and the obvious source for that is the licence fee.
Is it more in the interests of the public and the viewing public in this country that we should go on sustaining BBC 3 or yet another American import, or should we be using that money to ensure that regional news does not just appear on the BBC but continues to be broadcast on ITV? Should there be other providers of children’s programming outside the BBC? I welcome that debate, which Lord Carter is currently conducting, but those points have to be taken into account in this debate.
There is very little time, but I want to finish by saying that I am profoundly disturbed by the comments made by the chairman of the BBC Trust, which was set up to be different from the board of governors. It was supposed to be an arm’s length regulator, yet increasingly the chairman of the trust appears to be a champion of the BBC. When he suggests that it was somehow wrong for the Opposition to table this motion today, I have to say that he is straying on to political territory, which is very dangerous. He is also questioning the right of Parliament to determine the appropriate level of funding for the BBC. Of course Parliament should not interfere in the BBC’s editorial independence, but debating the right amount of public money to go to the BBC is not interfering in editorial independence. It is a function of this House. If the chairman of the trust is suggesting that we should not be having this debate, I believe that he is in severe danger of overstepping the mark. I hope that he will think very carefully before continuing to make that argument.
5.49 pm
Mr. Austin Mitchell (Great Grimsby) (Lab): The Opposition’s pathetic and opportunistic proposal tells us more about the intellectual decline of the Conservative party, and of its Front-Bench team in particular, than it does about the crucial problem of communications—that is, how we maintain and defend the quality of public service broadcasting in this country. The motion before us does nothing at all about that.
I expected to see the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale) sitting and squirming with embarrassment through the deluge of rubbish poured on us by his Front Bench spokesman. The Opposition’s agenda has been revealed to be top-slicing the BBC’s licence fee—that is the unstated purpose of the motion—and the fact that he at least had the courage to make that specific merely demonstrates that the intellectual rot has affected even him.
Philip Davies: Will the hon. Gentleman give way?
Mr. Mitchell: I always give way to Shipley.
Philip Davies: And I am very grateful too, but does the hon. Gentleman agree that top-slicing was recommended by the Select Committee as a whole? He will not have failed to notice that the Committee has a Labour majority.
Mr. Mitchell: I do not want to embark on top-slicing, and neither does the National Union of Journalists or anyone with a real concern for public service broadcasting. Once top-slicing starts, it never stops. If it starts, we shall end up with what happened when I was in New Zealand. There, the licence fee was frozen and never increased, with the result that demand for commercials to be broadcast on the public service broadcasting channel kept on growing.
The motion shows that today’s Conservative party has very little noblesse and damn all oblige. The spirit of Willie Whitelaw, a man who was generous to the BBC and to public service broadcasting, is frankly dead. The Opposition are clearly obsessed with the cost of everything, but care little for a valued institution such as the BBC. When the Tory Front-Bench spokesman
made his speech, he was surrounded by the boot boys of the Tory party, but most of them have left to do their boot work somewhere else. His was an intellectually feeble argument, and I am pleased to see that the Tory grandees are not participating in it.
The BBC has its faults, and we could go on about them at length. I wish that I had been paid the sort of salary that Jonathan Ross gets—I used to present a programme called “24 Hours A Day” and I was worth it—but there is no need to go on about the BBC’s faults, as all big organisations have them. Freezing or cutting the annual licence fee increase would secure only pathetic savings and, once we embarked on such a process, it would never stop. What would happen next year, or the year after? Another cut would be proposed.
The motion shows that the Tory party is reneging on the licence fee, which has been the basis for the financing of public service television over the years. It has been ring-fenced to the BBC to provide quality in public broadcasting through culture programmes, children’s programmes and regional services. The latter are very important in Yorkshire, and the BBC provides all the services from which ITV is pulling out. Are the Opposition arguing that, because ITV is cutting its public service obligations, we should force the BBC to do the same? Is that the essence of their argument—that, because ITV has had to make sacrifices, we should impose sacrifices on the BBC?
That is totally illogical. The BBC is the bastion and guardian of public service television in this country. Are the Opposition suggesting that the money saved on the licence fee should go to ITV, or are they proposing these savage cuts just to make the BBC show the same sacrifice as ITV? If so, that argument is illogical.
Mr. Edward Vaizey (Wantage) (Con): The argument is that the money should go back to the licence fee payer—the taxpayer.
Mr. Mitchell: Well, that would be a very generous donation to everybody. That would make no difference to most people’s cost of living. It is a futile gesture—and one that the Conservatives will want to repeat next year. We cannot suddenly impose such a cut in the third year of a six-year settlement. It was far from a generous settlement—it led to redundancies at the BBC when it was reached—but the BBC is working on the basis of it. The organisation needs stability. It is implementing a decision to make efficiency savings of 2 per cent. a year, and is doing quite well in that respect; the process is producing more redundancies than I would like. The BBC needs stability to plan and organise its resources for the long term, and the six-year settlement gives it that stability.
The Opposition suddenly want to take back that settlement. They want to interfere and stop it. That is crazy; it is just illogical. One would not run a sensible business in that fashion. The measure would mean the immediate loss of £75 million to the BBC. By 2012-13, the cumulative loss would be £325 million. Where, according to the Opposition, should those economies come from? Should they come from children’s programmes, or from cutting BBC 3 or BBC 4? Should they come from cutting out local radio altogether? That would
save £100 million; that is just £25 million more than the cut that would need to be made in the first year under the proposal. Should we close down Radios 1, 2 and 3? Is that what the Opposition are saying? Where will the economies come from to produce the cut? There is no case for it, and there is every argument against it. The Opposition’s proposals are just a piece of opportunistic vandalism, which, as I say, shows the sad decline in the Tory party. They are a foretaste of what is undoubtedly to come, as the Tories re-screen their magnum opus, “Carry on Cutting”—cut, slash and burn.
5.56 pm
Mr. William Cash (Stone) (Con): In an intervention on my party’s Front-Bench spokesman, I raised the question of the BBC’s accounts, for an important reason. A number of us, including the Chairman of the Public Accounts Committee and the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale), who is the Chairman of the Culture, Media and Sport Committee, have raised the matter time and again. All the arguments that we heard, including those of the Liberal spokesman, the hon. Member for Bath (Mr. Foster)—he apparently got his arguments from the finance director of the BBC—and all the arguments about the extent to which we are talking about value for money ultimately depend on whether we can see the accounts. I do not need to repeat the point; if we do not have a proper method of referring the accounts to the Public Accounts Committee, a lot of the analysis in this debate is completely worthless, because we do not really know.
In the same way, in-house productions are a cosy contractual arrangement, in many instances. That means that we do not really know whether they are sufficiently competitive with independent producers. I understand that “Panorama”—I hope that I am not wrong—has 40 programmes a year, of which 30 are in-house. If we are to have a thriving, competitive television and radio industry, it really does matter that we have accurate figures on how the various organisations operate in competition with one another.
I agree with my hon. Friend about the “Today” programme and the remarks made by the chairman of the BBC Trust today. Sarah Montague performed an interesting and important service today. It is the first time I have heard a presenter on any BBC programme raise the question of pay, expenses and allowances in the BBC. I am afraid that the Minister did not deal with that point. He quoted what the chairman of the trust said. I heard what the chairman said, and I have it written down. He referred to the trustees’ expenses, and, I think, to the board. He did not deal with the whole BBC employment structure; that is very important. I pay tribute to Sarah Montague for asking the questions that she did, and to the people who were no doubt behind her, who ensured not only that the questions were asked, but that she challenged the chairman of the trust when he tried to duck the issue.
My hon. Friend is right. I have written extensively to Mark Thompson and before that to Michael Grade, and I have had a series of meetings with directors-general over the past 10 or 12 years or more. I have written to them on many, many occasions about the way in
which the BBC functions in terms of impartiality and bias, but I have never had the kind of replies that I would have expected.
I believe in the BBC. It is an enormously important concept and it does an enormous amount of good, but it must operate on the basis of proper impartiality and accuracy. I am afraid that when one looks at the guidelines and then at the charter, it is evident that the guidelines are largely written for the benefit of getting the BBC to be able to control the conduct of editorial policy. The charter is much clearer. It refers to the question of impartiality in relation to public policy. Frequently we find ourselves caught up in the argument about whether the BBC is partial or impartial, according to party policy. That is not the issue. There are many subjects on which it is essential that the BBC should focus impartially on public policy, not merely party policy.
We are about to move forward in an extensive and necessary reform of Parliament. Our Parliament has become a sham and it is essential that we address the problems ourselves. It is essential that we look at the BBC in the same light. It is important that the BBC provides from within itself the processes of regulation and self-regulation to ensure that we get what the BBC is capable of producing. It has been and it can be a first- class organisation. I strongly believe that we need a system of enforcement of the BBC’s obligations in relation to impartiality and inaccuracy. That is important for the BBC, as Sarah Montague made clear this morning. It is essential for the BBC as a whole, from the director-general downwards.
There has been a severe lack of impartiality on a very big issue that is before the electorate—the European question. There has been a failure to address that— [Interruption.] As my hon. Friend the Member for Shipley (Philip Davies) says, the BBC has admitted that. I have the papers and correspondence that I have had with the BBC on that subject. It is important for this good reason: if we are to reform our Parliament, we must ensure that we return power where it belongs.
The BBC has more power and influence in many respects—probably in most respects—than Parliament. The best way to keep a secret is to make a speech in the House of Commons. The BBC’s presenters and interviewers can ask questions and supplementaries, and they can do things that we cannot do, but we are elected. I am sure they understand that, but I wish they would demonstrate it rather more and make sure that they are as impartial as we believe they should be, and as we try to be in this place.
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