Examination of Witnesses (Questions 43-112)
Peter Horrocks, Richard Thomas
3 November 2010
Q43 Chair: I warmly welcome Peter
Horrocks, the Director of BBC Global News, who is no stranger
to the Committee, and Richard Thomas, the Chief Operating Officer
for BBC Global News. You have been very much at the top of the
agenda in recent weeks and very topical, so it's very timely that
you should be here today to tell us what is going on. I'm going
to kick off the batting. The Foreign Secretary said to us the
other day that he hoped to find a settlement that would allow
the World Service "to become more efficient without actually
reducing those essential services that you and I care about so
much". Do you think that has been achieved, or are services
going to have to be cut? If so, how, when and where?
Peter Horrocks: Clearly, we share
the same objective as the Foreign Secretary. In terms of essential
services—which I would take to mean the most important services,
the ones where our priority audiences are, where we can have the
greatest impact—it is absolutely part of our strategy to
make sure that we are focusing in that way. Clearly, there is
a significant alteration in our resource, so we can't carry on
exactly as we are. Our intention is to focus our effort in the
most effective way, to take efficiencies wherever we can and to
make sure that we are modernising our services to regenerate the
BBC's operations, which is what has been happening successfully
over the past few years, and to continue that process. It is challenging,
given the resource that is available.
Q44 Chair: But do you envisage
any services being cut at all?
Peter Horrocks: I think that we
will want to propose both to the BBC Trust and to the Foreign
Secretary that some services should close, not simply because
of the spending settlement, but because it is something that we
need to assess because of competitors and impact on our audiences.
There are parts of the world where listening and consumption patterns
change, and we need to review the pattern of our services anyway,
as well as consider it in relation to the level of resource. I
believe that we will be suggesting that some services need to
close.
However, that is only a small part of the way
in which we intend to meet the financial challenge. There are
other things, such as support areas and marketing—that kind
of activity—that we need to look at closely. We need to
look at our distribution costs. In many parts of the world, short-wave
listening is in steep decline, and there are ways in which we
can reduce our costs of distribution by reducing short-wave transmissions.
We can also organise our editorial operations
in a different way. The Committee may be aware that all the BBC's
journalism activity is coming together in a single headquarters
in a revamped Broadcasting House in central London. The domestic
news services and the international news services are coming together.
The efficiencies that can be created through that, and the different
kind of content that we can produce of a much more global nature,
allow us to make changes to our editorial provision, but at lower
cost. But undoubtedly there will be real changes that audiences
will notice.
Q45 Chair: So, to summarise that
bit, things will look a bit different but "essential services"
will remain untouched.
Peter Horrocks: That is a fair
summary, yes.
Q46 Chair: In your last annual
review, you referred to several items of capital expenditure as
crucial in helping to "maintain a strong presence in core
markets". Are you going to be able to go on maintaining that
presence, given that your capital budget will be halved by 2014-15?
Peter Horrocks: I think the capital
reduction is one of the most severe aspects of the settlement.
That is clearly something that applies across the whole of the
public sector, where capital is being squeezed in a number of
areas. We use our capital to invest in new, more modern, more
cost-effective facilities. We are using it as well to pay for
the new journalism headquarters that I referred to. It is also
something that we need to use in order to make savings—to
move from short-wave radio distribution to FM transmission, for
instance, or to create new online or mobile services. We use capital
to make those changes. It will be harder to make the modernisation
shifts that we want to. We are going through a re-prioritisation
exercise to make sure that we are spending our capital as effectively
as possible. It will be harder to do that modernisation and regeneration,
which we have put forward as part of our strategy, without the
same level of capital as we have had up to now.
Chair: Thank you.
Q47 Sir Menzies Campbell: On a
point arising out of an answer that you gave a moment or two ago,
if all the BBC is going to be put on one site, I understand there
is to be one news-gathering organisation and, following from that,
one news-dissemination organisation. Is that correct?
Peter Horrocks: It will certainly
be a single organisation. One of the key aspects of the settlement
that was announced was, of course, the transfer of the World Service
to licence fee funding in three years' time.
Q48 Sir Menzies Campbell: We will
come to that.
Peter Horrocks: That will enable
us to be streamlined. It will be part of a single news organisation,
which will allow us to be more effective and share our content
as widely as possible. But, of course, in the same way that domestic
services need to differentiate between, for instance, the "Today"
programme and 5 Live audiences, we will still need to distinguish.
There will be editorial differences between different services,
such as radio and television and, self-evidently, between English
and other languages. We need to try to achieve the effectiveness
of an integrated operation while still delivering differences
to audiences and, of course, accounting for the money in an appropriate
way so that the spend on international services is clear.
Q49 Sir Menzies Campbell: But
it is clear to those who understand the World Service that it
has a particular culture and a particular style. How is that culture
and style to be preserved if the provision of news, to take one
example, takes place in the way you have just described?
Peter Horrocks: I hope that the
culture, style and distinctive character of the World Service
will be more present and available to audiences, including those
in the UK. For instance, our teams in our language operations
are being increasingly encouraged to use their expertise to produce
their content in English as well as in their native language.
That character will infuse the whole of the BBC's news operation,
so there is both creative benefit and efficiency from that. The
BBC Trust will put in place mechanisms to assess the effectiveness
of the international services and how much money goes into them,
so in the same way that the Radio 4 budget or the BBC 1 budget
is accounted for within a single organisation, that will need
to happen with the World Service as well. Clearly, the BBC Trust
will work on how it wants to do that.
Q50 Sir Menzies Campbell: To achieve
what you describe, and what I would think is highly desirable,
will require firm editorial policy and firm supervision by the
BBC Trust.
Peter Horrocks: Yes, and we have
some years before the transfer to the licence fee happens. I am
sure that the BBC Trust will consult and ask for input, and I
am sure that the comments of parliamentarians and Committees such
as this one will be taken into account when thinking about how
that is to be organised and how those measures will be put in
place.
Q51 Sir Menzies Campbell: Do you
expect to be before this Committee in the future, or before the
Culture, Media and Sport Committee?
Peter Horrocks: If this Committee
were still interested in the World Service, we would be very happy
to come along and continue to have the fruitful dialogue that
we have had for many years. Although the overall governmental
and departmental responsibility will lie with the DCMS, our intention
is to continue to provide the benefits to the UK's national interest
that the World Service has provided for many years. If this Committee
has a continued interest in that, we would welcome it.
Q52 Sir Menzies Campbell: I think
that the Committee would welcome that opportunity. The licence
fee is to be frozen for six years. By 2014-15, you will have passed
from the tender mercies—if that is the right way to describe
it—of the Foreign Office to those of the BBC Trust. At that
stage, how will resources be allocated to the World Service and
who will be responsible for doing so? What influence will the
Foreign Office have, for example, on what resources are allocated?
Peter Horrocks: Obviously, this
has happened relatively recently, so there are still things that
we are thinking about and, as I have indicated, there is some
time to think about that. As I understand from the initial consideration
that the BBC Trust has given it—this is primarily its responsibility
rather than a management one—a framework will be put in
place to look at the total funding. The BBC, in its agreement
with the Government about the funding transfer, has indicated
that it will continue to meet the current plans for the World
Service after extracting any efficiencies of the kind that I have
already spoken about. That is in the letter that Jeremy Hunt,
the Culture, Media and Sport Secretary, sent to the BBC Trust.
As well as that, there is a commitment to make sure that the right
mechanisms and the governance around that are in place. Finally,
the BBC and the Foreign Secretary have agreed that the provisions
of the current World Service agreement in relation to language
service closures—the determination will ultimately be made
by the Foreign Secretary—will continue as a shared responsibility
between the BBC and the Foreign Secretary.
Q53 Sir Menzies Campbell: But
the financing of the BBC World Service will become the responsibility
of the BBC Trust, as you understand it?
Peter Horrocks: It will do. The
funding will be raised through the licence fee, and the BBC Trust
will allocate that total licence fee funding.
Q54 Sir Menzies Campbell: Of course,
you are not the only institution, if I may put it that way, that
has been dealt with rather differently, because BBC Monitoring,
which is based at Caversham, is also going to become a responsibility
of the trustees. Is that right?
Peter Horrocks: That's correct.
Q55 Sir Menzies Campbell: I used
to know, and I have admiration for, Mr Bruce Forsyth, but I am
concerned that there might be competition for resources between
the World Service and light entertainment. How is that to be resolved?
Peter Horrocks: As I indicated,
the letter that sets out the agreement between the BBC and the
Government on this refers to the BBC's committing to provide sufficient
investment in the World Service to support its current plans for
the period. I take that as meaning that, by entering such an arrangement,
the Government and the BBC both intend that the broad provision
of international news services should be sustained. Clearly, in
the long term that depends on the overall funding of the BBC through
the licence fee, but I take that as being a broad statement about
continuing the range of services as they are at the moment, or
as they will be once the impact of the spending review has fed
through.
Q56 Sir Menzies Campbell: But
that will depend on the undertakings given on it.
Peter Horrocks: Yes, of course.
Q57 Sir Menzies Campbell: And
in a set of circumstances in which the World Service becomes part
of the overall BBC, but does not have the semi-independence that
it has enjoyed from its direct relationship with the Foreign Office.
Peter Horrocks: It is a different
set of arrangements, clearly, but we can be confident about how
the World Service will deliver value to international audiences
and, as I have explained, increasingly to audiences in the UK
as well. Less than £10 of the £145.50 licence fee will
go into the World Service, and we know from audience research
that the British public, at all of the different levels, regard
the World Service, in terms of bringing credit to Britain, as
one of the most significant institutions in the UK.
I believe that we can make a strong argument,
both through the value that we create for Britain and through
the indirect benefits that come to licence fee payers. We get
interviews—President Obama was interviewed by the BBC Persian
television service only a few weeks ago—because of the BBC
World Service, and viewers and listeners in the UK benefit from
that. I remember David Attenborough talking to a group of us from
the World Service, and he said that one of the reasons he is able
to make his documentaries around the world so effectively, with
co-operation from people, is because of the World Service's reputation.
There are many similar examples.
Personally, I am confident about the value that
the World Service creates for Britain and for licence fee payers.
If the BBC Trust puts the right measures and protections in place,
the operational and creative benefits of the synergies that could
be brought about will be a positive, rather than a negative, although
I do appreciate the concerns that some people have.
Sir Menzies Campbell: I salute your optimism,
Mr Horrocks, and I hope you won't take it amiss if I say that
you've simply persuaded me that the more this Committee continues
to take an interest in the outcome of the proposals, and indeed
the ultimate fate of the World Service, the better it will be.
Peter Horrocks: Thank you.
Q58 Mike Gapes: I was on this
Committee in the 1990s, and I can remember a big campaign to defend
the World Service from John Birt, who was trying to centralise
the news services at that time. Malcolm Rifkind, who was then
Foreign Secretary, was under great pressure, particularly from
our Committee—Sir John Stanley will recall this—and
we managed to get the Government to back off, and John Birt was
put back in his box. Do you agree with me that there is a distinctive
BBC World Service ethos?
Peter Horrocks: I do.
Q59 Mike Gapes: Are you confident
that the ethos of the World Service will be maintained in these
new arrangements?
Peter Horrocks: I am, because
I think that what the people who provide the World Service, and
have provided the World Service over many years, believe in is
something that can exist within these new structures and is able
to be spread and disseminated more widely, including to UK audiences.
There is a belief in understanding the world and bringing the
diversity of experience of all the World Service journalists together
to make sure that that voice is heard more loudly and more clearly.
We'll be in a single building with single funding, but we can
be more effective in doing that. I believe that we can be confident
about this new arrangement. It is something that I, personally,
always thought would, potentially, be a good thing. It's not something
that has occurred only as a result of the recent discussions.
Q60 Mike Gapes: The comprehensive
spending review is calling on the British Council and the World
Service to find savings via greater commercialisation of operations.
Given that you are now within the BBC, as opposed to the FCO ambit,
there have been some worrying reports; according to The Guardian,
your foreign language service websites are going to start taking
commercial advertising. Is that true?
Peter Horrocks: It certainly isn't
true that that's about to happen. We are still within the Foreign
Office ambit for the next three financial years, so this is a
change to the BBC licence fee that won't happen until the financial
year 2014-15. Within the recently announced CSR, we are being
asked to increase our commercial activity. I should say that,
in comparison with the British Council, the ability of the World
Service to commercialise is much smaller. We have a small amount
of commercial operations at the moment—they bring in small
numbers of millions—and we may well be able to extend that
further. Exactly how far we go and what will be appropriate is
something that the BBC Trust is yet to consider, so there are
no plans for advertising on foreign language websites as things
stand.
Q61 Mike Gapes: "No plans,"
as you know, is a term that has been highlighted in "Yes
Minister" and elsewhere. Getting back to the point about
ethos, it would clearly be inconsistent with the ethos of the
World Service if we start moving down the route of commercialisation
in order to finance your activities, because of the BBC. Would
you agree with that?
Peter Horrocks: There is a debate
about that. We, of course, have commercial activity on television—BBC
World News—and the BBC News website has adverts on it internationally.
If you were an Arabic speaker who is using the BBC News website
in Dubai, you would look at that website in English and it would
have adverts on it, and you would look at the BBC Arabic website
and it wouldn't have adverts on it. There could be an argument
for making some commercial return from that and maximising the
effectiveness of public investment into the BBC's international
news activities. That is what the BBC Trust will look at. Commercial
activity with proper protection can make the public investment
go further.
Q62 Mike Gapes: Okay. Final question:
when all these changes were brought about, how early did you know
that, from 2014, the BBC was going to take over, and that you
were no longer going to be under the FCO?
Peter Horrocks: Informal discussion
about the idea of licence fee funding of the World Service had
taken place over a number of months, and it is something that
had been discussed internally. Indeed, members of this Committee
have informally asked me questions about it in the past. However,
the actual decision to do it, or the likelihood of it, only happened
about 10 days or two weeks prior to the announcement.
Q63 Mike Gapes: So it was very
much something that you weren't planning for and that you didn't
initiate. This came out of some other part of the system.
Peter Horrocks: At that stage,
the licence fee was not part of the spending review. We had been
thinking about the possibility of this being considered when the
licence fee was thought about, according to the timetable that
we were expecting. Of course, that suddenly accelerated because
there were proposals from the Government to which we needed to
respond. It was something that we had put thought into in advance,
but, of course, it happened more quickly than any of us had expected.
Q64 Mike Gapes: So, in a sense—Sir
Ming has touched on this already—there are lots of unanswered
questions now because of the speed with which this was pushed
through and the uncertainties that it has created, aren't there?
We don't yet know what the implications are going to be for the
World Service.
Peter Horrocks: I think there
are questions of detail along the lines of those that you have
been asking. However, I think the commitments, in principle, are
clear in the agreement that the BBC and the Government have entered
into.
Mike Gapes: I am sure we'll be probing
you again in the future.
Q65 Sir John Stanley: I would
be grateful for your frank, personal answer to this question,
regardless of whether it will please Foreign Office Ministers
or the BBC board. Do you think that the decision by the Foreign
Secretary to transfer funding from the Foreign Office to the BBC
for the World Service is, or is not, in the best interests of
the World Service?
Peter Horrocks: I personally think
that it's in the best interests of the World Service. In formal
discussions, to which I have just referred, it was something that
I had personally suggested would be a good thing to do. I believe
that one of the BBC's greatest strengths is its journalism, and
its ability to bring all of its journalism together, to organise
it effectively and to make sure that the benefits of the World
Service's ethos, which we have been discussing, can be spread
and brought to bear as widely as possible for all of the BBC's
audiences—the largest news audiences in the world. To be
able to bring that together and strengthen its ethos is something
that I personally believe in. So yes, I was and am in favour of
the shift.
Q66 Sir John Stanley:
There's one specific point of detail on which I would be grateful
for your clarification. It seems to me, if this is the case, that
it was a very questionable decision to make you liable for a share
of the pension fund deficit of the BBC.
When you wrote to me—and I assume every
other MP on 25 October—you referred to the reduction of
your budget in real terms of 16%. You went on to say that, "the
World Service faces other financial pressures such as the extra
costs of the BBC's pension deficit, so the impact will be greater"—in
other words, greater than the 16%. Two days later, our Chair received
a letter from the Foreign Secretary which said, "If the BBC
provide funding to the World Service at the anticipated level
in 2014/15, the overall reduction in World Service funding will
be 16% real over four years. This includes additional funding
for the World Service's element of the BBC pensions deficit."
So, there appears to be a direct contradiction. Can you explain
to us whether you have had additional funding or not to keep the
amount by which your funding is falling at 16%, or is it more
than 16%?
Peter Horrocks: The funding reduction
is a real-terms reduction of 16%. The letter from the permanent
under-secretary at the FCO indicates that the pensions element
has been taken into account within that, but it is a 16% reduction.
We have got to find the money for that pension contribution. I
suppose another way of putting it is that, if the FCO hadn't allowed
for that, the cut would have been deeper.
Q67 Ann Clwyd:
Can I ask about the relationship between yourselves and your journalists?
You have talked about the importance of your journalists and your
pride in them, but we know that the NUJ has some issues with you.
Can you talk about the meetings you have had with the NUJ in relation
to your staff?
Peter Horrocks: Do you mean in
relation to the current pension dispute, or more broadly relating
to the settlement?
Q68 Ann Clwyd: Both.
Peter Horrocks: The pension dispute
is one that is BBC-wide rather than specific to the World Service.
The World Service needs to make its contribution to the extra
costs of the BBC pension deficit. Clearly, the journalists are
concerned about the deterioration in benefits in the future. However,
what the BBC more widely and the World Service specifically, have
been explaining is that the deficit is real, that there is a legal
requirement that the BBC needs to pay back that deficit to ensure
that the pension fund is strong for the future, and that the only
way that that can be funded is through reductions in services
and jobs. So, it is a difficult judgment that the BBC has had
to make.
The National Union of Journalists has voted—we
are not sure what the turnout was in that vote—to have industrial
action, which will happen on Friday and Saturday this week. We
regret that, and we are doing everything to ensure the continuation
of our services. The BBC has been very clear that it cannot make
further concessions, because it would mean a greater deterioration
in the quality of our service if we were to put more money into
the pension.
In terms of the impact of the settlement, we
are yet to announce the detail of that. We clearly have concerns
about its potential impact. We haven't yet made the announcements,
so we're not yet into the detailed discussions that we'll have
once we've finalised all our plans.
Q69 Ann Clwyd: What sort of redundancies
do you expect in the light of the cutbacks?
Peter Horrocks: You mean the number
of redundancies? Well, we're a very staff-heavy organisation.
Most of our costs are in people, and so the reduction in staff
numbers will be broadly in line with the level of savings that
we need to make—i.e. more than 16%.
Q70 Ann Clwyd: What sort of numbers?
Peter Horrocks: Well, our staffing
is 2,000, so you can work it out relatively straightforwardly,
but it will be hundreds of jobs that will need to go.
Q71 Mr Baron: One senses from
public utterances that the dust hasn't quite settled on the new
governance arrangements yet. We've had Lord Howell talking about
the BBC World Service being under the strong governance of the
FCO. The Foreign Secretary has talked about his written permission
being required for the opening and closing of new language services.
Yet Sir Michael Lyons can talk about complete editorial freedom.
Can you enlighten us a bit? When the dust has settled, how are
the new arrangements going to work?
Peter Horrocks: I think it will
be not dissimilar to how it's been up to now. The funding, however,
will be coming from the licence fee, and so we will be funded
by the British public rather than the British Government. In
some parts of the world that will be a very useful thing to say.
I saw a translation by BBC Monitoring of an editorial in an Iranian
newspaper today, which was referring to the BBC World Service
as funded and directed by the British Foreign Office. That is
something that will change; but the mechanics and the relationship,
I think, will still be very strong.
We rely on the Foreign Office's expertise and
understanding. We get support from ambassadors and missions around
the world, dealing with practical issues that we face in carrying
out our journalism. That's a mutually beneficial relationship.
Often, the only times when there are significant discussions
are every few years when funding is decided or services may be
being opened or closed. At other times it's a very well functioning
partnership, where we share information: the BBC has the expertise
in broadcasting—that's clearly not a speciality of the Foreign
Office—and we put forward our plans; the Foreign Office
considers them and we invariably reach rapid agreement about what
our priorities should be. The main instruments or the main determinants
of it are in the existing agreement, and we've said that that
will continue. There will probably be some fine tuning around
that, but I don't suspect that there will be a significant shift.
Q72 Mr Baron: The BBC World Service
has huge credibility and tremendous scope around the world, partly
because of its independence. Do you envisage any risks whatsoever,
in the changing of the funding arrangements, to that reputation
and that scope and reach?
Peter Horrocks: Clearly, if some
of the anxieties that were expressed by your fellow Committee
members came true—if, as it were, the "Strictly Come
Dancing" budget were in trouble, and therefore the Somali
budget needed to be raided—I would be anxious about that;
but I think the right measures will be put in place. Apart from
that I don't have significant anxieties, and I'm sure we'll be
able to reassure the Committee in relation to those mechanisms
once they're agreed in the next period. As I say, they don't
need to be in place for more than three years.
Q73 Mr Baron: Putting anxieties
perhaps to one side, then, do you think there are any other longer-term
consequences of changing the funding arrangement?
Peter Horrocks: I think that the
question that Mr Gapes asked about commercial funding, and whether
that might be seen in a slightly different light, is a legitimate
one. Also, what's the balance between the journalism that's created
of benefit to specific countries, and the benefit that's created
for a global audience and for audiences in the UK? You might
see that in a slightly different light, potentially. However,
I think that fits with the overall likely necessary direction
of travel. Local competition is increasing in many of the countries
that we operate in, and the thing that we most bring to our audiences
around the world is that global perspective. There are not many
news organisations in the world that are as well set up as the
BBC is to give people a rounded, tolerant view of a world that
needs greater understanding. That does not tend to be provided
by sensationalist media, whether it is commercial or state-funded,
which is much more partisan than ours is. With the ability to
do global journalism that reflects all those different points
of view and with the expertise that we have—I think we are
in a good position to do that. I think that is probably an editorial
direction of travel, which is implied by this, but that is probably
the right thing for our audiences and the distinctive role that
the BBC can play.
Q74 Mr Watts: You seem to be fairly
confident that the general public will continue to want to support
the World Service to the level that you have proposed. You seem
to get some comfort from the fact that you have done some survey
work that has shown that the British public are generally in support
of and value the service. Do you think that value goes as far
as wanting to pay for it? We know from all the research that we
have seen before that the BBC's licence fee is not that popular
out there with lots of people. Isn't that likely in future years
to lead to some pressure, if there is a reduction of funding for
general programming? Aren't you likely to be squeezed because
you aren't accessed to the same degree by the general public?
You are seen as a secondary service to the main service that the
BBC provides.
Peter Horrocks: I agree that that
is a potential issue. Of course, the public pay for the World
Service at the moment as part of general taxation. It is a different
mechanism and it exposes it in a different way. As I have indicated,
I think that with less than £10 of the licence fee going
into paying for the World Service, our demonstrating through the
contribution that World Service journalists make—particularly
language service journalists, who are generally seen and heard
less in the UK than they can now be elsewhere—will help
to emphasise to audiences in the UK the value that is created.
Of course, it is part of the question, "What's
the right level of funding for the BBC in future?" That is
as much a determinant of the ability to sustain the range of the
BBC's services, so I truly hope that it won't be a question of
the World Service getting the blame for any tightening of BBC
funding. It is an agreement that has been entered into between
the BBC and the Government, and I am sure that we can demonstrate
the value to the audience.
Q75 Mr Watts: Isn't the position
going to be even worse than the one I proposed on the basis of
the freeze of the licence fee, where there will be less money
for normal programming than there would have been if you take
into account inflation? It is not just the fact that the World
Service is competing with general programming; it will be faced
with reduced resources overall for the BBC. I don't need to tell
anyone in this room that you will hear criticism about repeat
programmes and about the poor quality of some of the material
that the BBC uses. Aren't all those factors likely to make the
situation even worse for the BBC World Service?
Peter Horrocks: I don't think
it will make it worse for the World Service if the measures that
we have been discussing are in place. Of course I understand that
some people may ask the question that you are asking. I suppose
what you are referring to is a judgment that was made as a wider
judgment, rather than the one that is specific to the World Service,
by the BBC Director General and by the Chairman of the BBC Trust.
They clearly took the view—especially in relation to the
alternative suggestion, the possible funding by the licence fee
of the free licence fees for over-75s, which would have represented
a much more significant reduction in the domestic services of
the BBC—that this was the right thing to do for the BBC
given the financial constraints that the country as a whole finds
itself in. That was a broader judgment that I was part of, but
I wasn't making that call.
Q76 Chair: Forgive me if you have
dealt with this point, but it is still not clear in my mind. Who
has the last word in editorial direction? If there are two countries,
one of which you are broadcasting to and one of which you are
not, and you want to switch it, who makes that decision? Will
you discuss priorities with the Foreign Office, or is the Foreign
Office out of this equation now and it lies with you and the BBC
Trust?
Peter Horrocks: It won't change;
the funding mechanism doesn't change until April 2014.
Q77 Chair: But after then?
Peter Horrocks: The mechanism
is going to stay the same. In practice, the BBC would often be
aware of a market need, and it would be aware that there was something
that we wanted to respond to in the audience. But the Foreign
Secretary has the authority to ultimately open or close any language
service. That current arrangement is going to continue in the
new funding.
Q78 Chair: So he'll continue to
have the last word?
Peter Horrocks: Yes, he would.
I think it is expressed as a joint decision, but ultimately it
would be the Foreign Secretary who still has that authority.
Q79 Sir Menzies Campbell: But
doesn't the Foreign Secretary have that authority because he is
the person who is providing the funds? If he is no longer providing
the funds, he no longer has that authority. He can make approaches
to the trust, for example, but he will not be in a position to
compel, as he is at the moment.
Peter Horrocks: The BBC has agreed
that the existing arrangements will continue. That was the agreement
that was entered into. In practice, as far as I can tell when
looking back on the history, there has not been a significant
disagreement between the BBC's view about the broadcasting need
and the Foreign Office's view of, as it were, the long-term national
need to be broadcasting in particular languages. As I say, the
agreement says that that arrangement will continue.
Chair: The problem is how without financial
responsibility.
Q80 Mr Ainsworth: In your written
evidence you provide us with extensive detail on how audiences
are changing the way in which they access world news. You say
that this demonstrates the need for the World Service to be able
to accelerate its response to global changes. In earlier exchanges
with the Chairman, you talked about the very challenging capital
programme that you have, and potentially your inability to do
that. That surely is going to have a detrimental effect on impact.
Peter Horrocks: I wouldn't say
it's an inability. It will slow down our ability to be able to
do that. But one of the things in the funding settlement is an
intention to reinvest in either new services or new offers within
services. So one of the things we'll be doing is to put together
editorial teams from different languages, working in new ways
to produce content for websites, for instance, or low-cost television
programming. Our Turkish team, for instance, provides a foreign
affairs programme to a Turkish television channel, which provides
quality "Newsnight" type foreign affairs coverage in
Turkey. We will be able to afford that type of programming within
the settlement.
Q81 Mr Ainsworth: So you don't
envisage a deterioration in impact?
Peter Horrocks: Clearly if we
do close some services, that would be a reduction.
Q82 Mr Ainsworth: How far away
from taking decisions are you?
Peter Horrocks: Within weeks.
Q83 Mr Ainsworth: You will be
taking decisions within weeks?
Peter Horrocks: There are decisions
that are taken by the World Service board that need to be ratified
or agreed by the BBC Trust, and then ultimately they rest with
the Foreign Secretary.
Q84 Mr Ainsworth: So you are wrestling
with this now?
Peter Horrocks: Absolutely. We
were having a board meeting this morning in which we talked about
exactly these issues.
Q85 Mr Ainsworth: You say that
you are not sure whether other than those closures there will
be a diminution in impact, but you are not really meeting your
performance targets now, are you?
Peter Horrocks: No, we are short
on our reach target. That is largely because of the changes in
listening habits that I have mentioned already.
Q86 Mr Ainsworth: And your inability
to respond.
Peter Horrocks: It's not so much
that. Our largest audience falls, for instance, are in rural parts
of India and Bangladesh, where people have only been able to listen
to shortwave radio until recently. Local FM music stations start
up and people listen, as they did in the UK, to commercial radio
stations once that becomes available. So I don't regard that as
being a vote of no confidence in the BBC's content. What we want
to do in India is focus our activity on audiences who are particularly
interested in international news and deliver that via television
and online to reach opinion formers and people with educational
aspirations who want to understand about the world. There is a
significant shift in the type of audience, and it may be a slightly
smaller audience. That is the kind of thing we need to invest
in to modernise and change our profile.
Q87 Mr Ainsworth: Are you going
to change the performance targets?
Peter Horrocks: The performance
targets are set jointly with the Foreign Office. Having an unrealistic
reach target would probably be the wrong thing in the context
that we're in and with resources being stretched. So, I think
that it will be as important to put as much emphasis on looking
at how we are doing in targeting specific audiences and the measures
in terms of quality and reputation that we already have as on
the overall head count.
Q88 Mr Ainsworth: But on reach,
we will have to lower our ambitions?
Peter Horrocks: I think that's
right, yes.
Q89 Mr Ainsworth: By what kind
of percentage, do you think?
Peter Horrocks: That will depend
on exactly where we get to in terms of the number of services
and the reinvestment plans. Once we have established that, we
will calibrate what we think is a realistic target and suggest
to the Foreign Office that we have a realistic approach to it.
Given that we have a reduction in resource, I think that being
realistic about that is the right thing to do.
Q90 Mr Ainsworth: Are there particular
areas where you think you might abandon that reach and other areas
where you might try to maintain that reach?
Peter Horrocks: I think our largest
reach is in big markets—India and Africa would be good examples
of those—where I think it is more about re-orientating our
reach rather than withdrawing it. If they happen, the service
closures will tend to be in smaller, individual parts of the world,
rather than in our large markets.
Q91 Rory Stewart: Could you tell
us a little about BBC Arabic, how it is doing, how you are managing
to compete with other Arabic language stations, where you hope
to take it and how the funding cuts will affect it?
Peter Horrocks: The overall reach
for BBC Arabic across radio, television and online is just short
of the target of 25 million; it is 22 million, which we are pleased
with. BBC Arabic has established itself as an effective 24-hour
news service. However, our audience research indicates that it
is not sufficiently distinctive compared to the existing, well
established news channels, such as al-Jazeera and al-Arabiya.
It is well respected and it provides an alternative and impartial
news source, but we think that we can do more in terms of discussion,
investigation, documentary and analysis. So our intention is to
move more towards that type of programming and to provide something
that is distinctive for the Arabic market, discussing topics and
looking into things that the Arabic media tend not to look into.
Q92 Rory Stewart: Can you give us
a sense of the contrast in resources between you and the main
Arabic challengers?
Peter Horrocks: Al-Jazeera would
have four or five times the resource that BBC Arabic has got.
Q93 Rory Stewart: And how will
you respond to that? Given that they have four or five times the
resource and the people that you do, how do you position yourselves?
Peter Horrocks: By competing in
those areas that I mentioned. For instance, we produced a series
of investigative documentaries about people who convert from the
Muslim faith to Christianity, examining what happens to them in
terms of how society treats them. That is not something that would
tend to be covered by the mainstream Arabic channels. By making
distinctive programmes like that, which gets talked about and
gets noticed, we create a reputation for touching on subjects
that other channels tend not to go into. That attracts people
to us, because they want to have discussions on our programmes
and they want to interact with us. And we use the radio, TV and
online that is on offer around that distinctive journalism, rather
than just competing head to head on mainstream news.
Q94 Rory Stewart: On the Persian
language, particularly Persian language TV, can you give us a
sense of how you will position yourself and defend yourself against
competitors? That seems to be the main problem in all these markets.
There is more and more money pumping in, great new satellite and
domestic channels. How will you work with Persian TV?
Peter Horrocks: With BBC Persian
TV, I think that we already have a distinctive proposition and
I think that the response from audiences already shows that. We
have not faced quite the same issues of competition that we have
faced in the Arabic market. In many ways, we were providing something
to Iran that others were not providing. So I think it is about
sustaining that work and ensuring that the cultural quality that
it has continues. For instance, the channel does quite a lot around
technology, music and interpreting the world through Iranian eyes,
which is very popular. As with the Arabic proposition, we make
sure that the channel is discussing things and talking about subjects
that are not talked about either in the Iranian domestic media
or in the increasing commercial operations that are targeting
Iran.
Q95 Rory Stewart: And Urdu, finally?
Where are we with Urdu?
Peter Horrocks: We don't think
that we have the resource at the moment to launch a complete Urdu
TV channel in the way that we did for Arabic and Persian. However,
as part of the plan we hope to create some bespoke TV programming
for the Urdu market and we also intend to build on the success
of the Urdu website, which is already the most popular news website
in Pakistan.
Q96 Rory Stewart: The instrumental
argument is the war on terror and connections with these types
of issues. Can you make an argument to the Foreign Office about
the importance of these issues?
Peter Horrocks: We don't position
any of our services in relation to any particular political goal
or to a label such as the "war on terror". We say the
provision of independent, impartial news, which helps people to
understand their own world and to be tolerant of each other, can
contribute to broader political goals, but I would not put such
a badge on any of our services.
Q97 Sir John Stanley: As you know,
Mr Horrocks, the previous Committee gave very strong, consistent
support to the Persian TV service. You kindly invited us to its
launch, which we were glad to do. How near are you to getting
it out on a 24-hour basis?
Peter Horrocks: I am afraid that
with the resource settlement that we have received recently, that
is an aspiration that is beyond us. We will not be able to move
towards 24-hour television for Persian with the funding that we
have.
Q98 Sir John Stanley: Where are
you as of now in the number of hours per day?
Peter Horrocks: We are about five
or six hours, but there is some repetition as well, so there's
five or six hours of origination per day.
Q99 Sir John Stanley: I don't
know whether you were in the room during the evidence that we
have just taken from the British Council, but its witnesses just
confirmed to us that the Iranian authorities are on a complete
shut-out of the British Council, which, indeed, highlights the
significance and importance of the contribution that you are making
through the BBC World Service. Can you just tell us what steps,
if any, the Iranian authorities are taking to try and reduce the
number of people in Iran who are able to pick up your World Service
TV in Persian?
Peter Horrocks: This time last
year we were being jammed all the time. That has now stopped,
helpfully, so there has been a small improvement. It is still
illegal to have satellite dishes trained on outside, international
broadcasts and, occasionally, there are efforts by the police
to confiscate those satellites.
The main restriction that we have is on our
ability to be able to do any journalism on the ground in Iran.
The BBC Persian service has not been able to operate there for
many years. BBC News was there but, in the immediate aftermath
of the post-election violence, the BBC News correspondent, Jon
Leyne, was thrown out. So far, BBC News has not been allowed back
in, and that makes doing the journalism from Iran very difficult
indeed. We rely hugely on our viewers and listeners providing
us with material, via mobile phones and so on, in order to be
able to cover the country. That is the main way in which we are
prevented from doing as effective a service for Iran as we would
like to.
Q100 Sir John Stanley: Are there
any ways in which the FCO could be giving you greater help to
overcome these sort of obstructions being put in your way by the
Iranian authorities?
Peter Horrocks: We value the support
that we get, in helping to counter the jamming for instance. There
are various broadcast regulatory bodies with which we are working
closely, with the Foreign Office, to try and ensure that the jamming
that happened doesn't happen again. However, I think that the
leverage that can be obtained on the Iranian authorities—across
a very wide range of issues, many more serious than broadcasting
ones—is relatively small. So, we value the support but,
at the moment, it doesn't seem likely that the Iranian authorities
will decide to shift as a result of pressure. It is really something
for the Iranian Government to decide—and it was interesting
that they decided to stop the jamming. There were commentaries
in the Iranian press pointing to the success of the BBC Persian
service and saying that people were still watching it—they
were managing to get around the jamming—and that it was
important that we open up and that our broadcasting competes.
That was an example in which the effectiveness of the BBC was
helping to shift debate within a country.
Q101 Sir John Stanley: The people
in Iran, who I am very glad to know are in touch with you—they
are giving you mobile phone communications possibly, or other
forms of communication, the internet, etc.—are they making
any particular recommendations or suggestions to you as to how
you might be able to increase your coverage and accessibility
in Iran?
Peter Horrocks: Yes, we use their
suggestions and we use their contributions to our programmes—we
use that to guide the programming. They tell us which programmes
they like and the music they like, and we respond to that. We
are also working to help people who want to evade blocking of
the internet—that is relevant in China as well. The BBC
World Service's technological team is working with technology
organisations, such as Google, and also with other international
broadcasters, such as the Voice of America, to support people
who are creating software that allows jamming to be circumvented.
That is important and helps us to get our content through, and
helps to stop the regimes that wish to block the free internet.
Q102 Mr Roy: Many World Service
journalists come to this country on work visas, and they often
come from very dangerous countries with very dangerous regimes,
and they broadcast impartially to those countries. What happens
to those journalists if they lose their jobs at the BBC?
Peter Horrocks: You are touching
on something that is one of my strongest personal anxieties, and
it is relevant to the Persian television team. A number of those
people came to London a couple of years ago when relations were
relatively open, and now they can't go back. The Persian service
is not under any potential threat of closure, but it shows the
personal difficulty and the commitment that individual journalists
make. The things that they are doing for the BBC and, in effect,
for this country put them in a difficult position. We will work
very closely with individuals when we need to make changes to
our services. If services are closing or if we are reducing numbers
within services, we will try, where possible, to redeploy people
within the BBC. We closed our eastern European services a few
years ago, but many of those journalists still work within the
BBC. So, as far as possible, we will try to retain people and
help them with out-placement and training to help them get jobs
where possible. Clearly, if anyone is in any personal danger,
as a result of having lost their employment with the BBC and are
not in a position to be able to return to their country of origin,
that is something that we would wish to take up with the authorities
and to ensure that due consideration was given to that. It would
be very unfortunate if anyone was in the position of being exposed
to danger because of the work that they had been doing for the
World Service.
Q103 Mike Gapes: You gave us a
helpful memorandum in which you highlight a number of other countries
where there are what you call challenges. May I ask you specifically
about what is happening in China? It has been jamming the BBC
World Service, and it also has, as far as I understand it, a policy
of allowing language services but not English services, and that
relates to websites as well. Is that situation any better than
it was? I know that it was relaxed for the Olympics and then re-imposed
later on. How is it in China now?
Peter Horrocks: It's not good.
There was the recent award of the Nobel Peace Prize. The moment
the words "Nobel Peace Prize" were uttered on BBC World
News, the switch was switched, and the broadcast was stopped.
It is not quite correct to say that our language services are
freely available. We have two different versions of our BBC Chinese
website. We have an English language teaching website that is
available in China, but the news site in Chinese is blocked and
isn't available and neither is BBC news online in English. BBC
World News is only available in a small number of hotels that
tend to cater for outside visitors.
Q104 Mike Gapes: In the context
of Iran, you referred to an ability to circumvent jamming and
blocking. Presumably, there are a number of countries in which
the authorities would be working very hard to stop you doing that.
What is the position in China?
Peter Horrocks: The Chinese Government
put significant resource into this, and built the so-called great
firewall of China. However, there is a lot of technological ingenuity
in China and people are finding ways round it. As I say, we are
trying to help them. I don't particularly want to go into the
ways in which we are doing that. I don't want to block off any
of those avenues, but we are certainly focusing on that.
Q105 Mike Gapes: But it's not
just China. Don't you have the same problems in other countries
as well?
Peter Horrocks: Yes, although
you do have to have quite significant resource as a Government
to do it. China is by far the most focused and concentrated on
doing this.
Q106 Mike Gapes: Overall, would
you say that in terms of countries blocking or obstructing the
BBC World Service, the situation is better or worse?
Peter Horrocks: The stopping
of the jamming in Iran was a real plus, but in terms of the numbers
of countries that have introduced new measures—for instance,
the Pakistani regulatory authority has taken some of our broadcasts
off air this year—
Q107 Mike Gapes: Why?
Peter Horrocks: Not clear. Both
India and Nigeria do not allow BBC news services on FM, so we're
not able to do that in those two key countries. It's a particularly
difficult situation in Somalia, where the al-Shabaab militants
seized all of our transmitters, and we've also had difficulties
in northern Sudan as well. So I would say, on balance, it's been
a bad year.
Q108 Mike Gapes: I'm on the awarding
body for the Speaker Abbot Award. We gave an award to a BBC journalist
from Somalia who wasn't able to come to receive the award. You've
clearly got very brave people there.
Can I conclude by questioning what's going to
happen in future, given this shift of resource constraint and
movement to competition with other parts of the BBC system? Are
you confident you will get the resources you need to overcome
these difficulties, or will it be more a question that it might
be deemed to be not worth the trouble, and therefore you'll end
up reducing your global footprint, so that perhaps you will have
even fewer listeners than the Voice of America?
Peter Horrocks: I really hope
we won't lose that global leadership. I think that's an important
thing for Britain. It's one of the most distinctive things that
Britain has: the BBC and its ability to project British values
around the world. I don't see it as being about a competition
within the BBC; I think that the right measures need to be put
in place, as we discussed in the earlier part of this session.
The case for what we do gets stronger and stronger.
Commercial news media are withdrawing from coverage in the world,
and the only people who are investing in it are Iran, Russia and
China, whose view of international broadcasting is very different
from the ethos that the BBC stands for. The BBC's strategy for
both domestic and international audiences, which it set out this
year, is called "Putting quality first", and the very
top priority for the BBC is its journalism, both in the UK and
around the world. It would be completely negligent of the BBC
to ignore that need in the world. It has said that it thinks journalism
needs to be put first, and it said in the agreement that was recently
reached between the Government and the BBC that it wants to sustain
the World Service. I am sure that those who have the good sense
that you have, Mr Gapes, will hold the BBC to that. I am sure
that we'll want to be held to that.
Chair: We've got three minutes left,
and two colleagues have caught my eye. We can have a few questions
and quick answers.
Q109 Mr Baron: I asked this question
of the British Council. Do you think there is any risk whatsoever
that because of financial pressures and the need, perhaps, to
commercialise activities a little bit, the superb brand that the
World Service has will be tarnished? Is there any risk at all?
Peter Horrocks: There is a risk,
and it's one that we have to be alert to. I run BBC World News,
the commercial news channel, as well. I have responsibility for
that along with the World Service. It operates to the same editorial
values. The BBC news website around the world, which is in many
ways the most clear-cut and modern expression of what the BBC
is about—they're both commercially run. I think that if
we are creating commercial revenues but then sustaining our journalism
from and to parts of the world where a commercial model is not
possible, we can use public funding and commercial funding in
a smart way to sustain that World Service ethos.
We should be vigilant about it all the time,
but as long as we are clear about what our values are and smart
about how we execute a sensible financial model that uses the
benefits of the public investment, which is now going to come
from the licence fee, and an appropriate level of commercialism
that doesn't undermine the organisation and how it's seen, I think
that's a sensible modern way of working. We get more value for
the licence payer and for the UK public by working in that way.
Q110 Mr Ainsworth: On your answer
to Mike Gapes about what happens in Pakistan, some of your programmes
are jammed, and you don't know why?
Peter Horrocks: They're not jammed.
What happens is that the regulator—
Q111 Mr Ainsworth: There's no
explanation for it whatsoever?
Peter Horrocks: Bureaucratic reasons,
usually, are advanced. So—
Q112 Mr Ainsworth: Can you provide
us with a note of what those programmes are?
Peter Horrocks: I can certainly
do that. If we can clarify that with the Pakistani authorities,
we'll feed that back to you.
Chair: Thank you both very much indeed.
It's been a very helpful session. It's much appreciated that you've
taken the time to come along and speak to us. Many thanks.
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