BBC Response to CMS Select Committee Questions,
November 2010
WILLINGNESS TO
PAY/VALUE
FOR MONEY
1. The Committee would be grateful for information
on any research conducted since the 2008-09 Annual Report on the
public's view about the appropriateness of the licence fee as
a funding mechanism, its willingness to pay and value for money
perceptions.
RESPONSE FROM
BBC MANAGEMENT
Appropriateness of the licence fee as a funding
mechanism
In August 2009 TNS repeated a question for the BBC
asking about replacing the licence fee with advertising that had
been first posed to the public as part of research conducted for
the Peacock Review in 1985. This was to ascertain whether, given
the vastly greater media choice today, public attitudes towards
the licence fee were different now compared with a generation
ago. The results were as follows:
- In 1985 62% of the public thought it would be
a good idea "if the licence fee was replaced entirely by
revenue from advertising on the BBC" (31% thought this would
be a bad idea; 8% don't know).[1]
- Asked exactly the same question in August 2009,
a much lower proportion of the population thought replacing the
licence fee with advertising would be a good idea—44% (51%
thought this would be a bad idea; 5% don't know).[2]
Other surveys conducted by ICM and ComRes since the
2008-09 Annual Report was published suggest that the licence fee
has more support than any one of the alternative means of funding
the BBC.
- A poll by ICM for the Guardian in September 2009
found that when asked what they would like to see as the main
source of BBC funding, 43% of the public backed a licence fee
paid for by everyone with a TV; 30% indicated a subscription-only
service paid by those who want to receive BBC programmes; and
24% selected advertising (4% don't know).[3]
- In November 2009, ComRes asked a similar question
to the public for Newsnight about the preferred method
of BBC funding, and this also showed the licence fee to have the
highest degree of support at 38%, with advertising on 30%; subscription
on 21%; money raised from taxes on 7% (3% don't know).[4]
One survey (by YouGov for Deloitte) in July 2009
returned a different result. Asking respondents "Would you
prefer to receive adverts across all channels instead of paying
a licence fee", 57% in the survey said yes and 36% said no
(8% don't know).[5]
However, the question asked did not relate the licence fee to
the BBC and was not specifically about how the BBC should be funded.
As the findings from the other surveys above show, the licence
fee has greater support when respondents consider it in terms
of what it is paying for and in terms of how they would prefer
to see the BBC financed.
In summary, therefore, the results from three national
surveys that have asked the public how the BBC should be funded
conducted since the publication of the 2008-09 Annual Report (TNS2,
ICM3 and ComRes4) suggest that the licence
fee, whilst not universally popular, is viewed as the most appropriate
means of funding the BBC.
Value for money of the licence fee
Research from 2009 shows that the majority of the
public—around six out of 10—believe the BBC offers
good value for money through the licence fee.
- Most recent published figures from autumn 2009/spring
2010 on the value for money of the licence fee from an annual
survey by Kantar Media for the BBC Trust show that 58% of the
public think the licence fee is value for money (38% think it
is not value for money; 4% don't know).[6]
- In an ICM poll for the Guardian in September
2009, 63% said the BBC was good value for money (35% disagreed;
2% don't know).[7]
- And in a ComRes poll for Newsnight in
November 2009, 56% said the BBC was good value for money (42%
disagreed; 2% don't know).[8]
Willingness to pay the licence fee
In August 2009, TNS asked the public on behalf of
the BBC how much they were willing to pay for the BBC from the
point of view of their household and from the point of view of
society as a whole.
- Almost nine out of ten people were willing to
pay something for the BBC (87% thinking about their household
and 86% thinking about society as whole).
- The average amount respondents were prepared
to pay was £19.42 per month (from the perspective of the
individual) and £18.32 per month (societal perspective),
both higher than the current level of the licence fee.[9]
The average amount respondents were prepared to pay
in this 2009 survey was slightly down on a similar exercise conducted
by Ipsos MORI for the BBC in 2008 where the average amount respondents
had been willing to pay was £20.43 per month.[10]
The average willingness to pay figures from August
2009 of £19.42 per month (household perspective) and £18.32
per month (societal perspective) appear higher than willingness
to pay figures published by Ofcom in 2008.[11]
(In the study for Ofcom, the average amount respondents had been
willing to pay for the BBC had been £11.56 (personal perspective)
and £13.87 (citizen perspective).) However, these figures
are not directly comparable because of differences in the methodology
used.
2. Why did you not make clear in this year's
Annual Report that the figure "82% of the public would miss
the BBC if it wasn't there" was a 3% decrease on the previous
year's figure of 85% as reported by the Trust Chairman in the
2008-09 Annual Report?
RESPONSE FROM
BBC TRUST
Over the last four years there has been a substantial
trend increase in the percentage of those agreeing that they would
miss the BBC if it didn't exist, with only 70% agreeing with this
statement in 2007. Figures are likely to very from year to year
and the decline to 82% is therefore not necessarily significant.
Next year's survey will show us whether this is the beginning
of a downward trend or whether it merely reflects an annual variation
AUDIENCE REACH,
SHARE AND
VIEWING
3. In 2009-10, what was the 15 minute reach among
16-34 year olds for (i) each of the BBC's television services
and (ii) the television portfolio in aggregate?
RESPONSE FROM
BBC MANAGEMENT
(i) The table sets out the 15-minute average
weekly reach for each of the BBC television services and the BBC
television portfolio overall among 16-34 year-olds in financial
year 2009-10. The figures for financial year 2008-09 are also
given to match the presentation of the reach figures for all individuals
in the Annual Report. With the exception of BBC Two and the BBC
News Channel, average weekly reach among 16-34 year-olds of individual
BBC television services in 2009-10 is equal to or higher than
in 2008-09.
(ii) As the table also shows, in 2009-10 the
BBC television portfolio reached 76% of 16-34 year-olds in a week
on average, slightly up on 2008-09. In addition, across a month,
91% of 16-34 year-olds on average watch BBC television. Across
a three-month period, 97% of 16-34 year-olds on average watch
BBC television. And across a year, we would expect the figure
to be even higher.
Source: BARB, 15 mins
consecutive average weekly reach, average monthly reach based
on BARB months, and average quarterly reach among 16-34 year-olds,
financial year 2009-10 (30 March 2009-28 March 2010 minus week
53 owing to BARB panel change).
AVERAGE WEEKLY REACH (15-MINUTE CONSECUTIVE)
OF EACH BBC TV SERVICE AND THE BBC TV PORTFOLIO OVERALL AMONG
16-34 YEAR-OLDS IN FINANCIAL YEAR 2009-10 (AND FINANCIAL YEAR
2008-09)
| 16-34 year-olds
FY 2009-10
| 16-34 year-olds
FY 2008-09
|
| Average
weekly
reach
| Average
weekly
reach |
Average
weekly
reach | Average
weekly
reach
|
| 000s | %
| 000s | % |
| BBC One | 9,557 | 66.3%
| 9,488 | 66.2% |
| BBC Two | 6,055 | 42.0%
| 6,393 | 44.6% |
| BBC Three | 3,937 | 27.3%
| 3,725 | 26.0% |
| BBC Four | 709 | 4.9%
| 667 | 4.7% |
| BBC HD Channel | 216 | 1.5%
| 69 | 0.5% |
| CBeebies | 1,599 | 11.1%
| 1,543 | 10.8% |
| CBBC | 466 | 3.2%
| 403 | 2.8% |
| BBC News Channel | 671 | 4.7%
| 730 | 5.1% |
| BBC Parliament | 15 | 0.1%
| 17 | 0.1% |
| BBC TV PORTFOLIO OVERALL
| 10,944 | 75.9% | 10,783
| 75.2% |
Source: BARB, 15 mins consecutive average weekly reach
among 16-34 year-olds, financial year 2009-10 (30 March 2009-28
March 2010 minus week 53 owing to BARB panel change) and financial
year 2008-09 (31 March 2008-29 March 2009).
4. In its Fifth Report of Session 2009-10, BBC Annual Report
2008-09, our predecessor Committee concluded that the BBC should
be more transparent in setting out its reach targets (recommendation
4) In its July 2010 response, the Trust stated that "in line
with the Committee's recommendation we will review the information
we provide and consider whether additional measures of reach would
give a better indication of performance". We would appreciate
an update on progress.
RESPONSE FROM
BBC TRUST
The relevant recommendation in the Committee's Fifth Report of
Session 2009-10, BBC Annual Report 2008-09 is set out below:
The BBC should be more transparent in setting out its reach targets,
including the figures for minimum level of reach considered necessary
to serve its target audiences. It should also consider publishing
additional measures of reach likely to provide a better indicator
of the proportion of the public watching entire BBC television
programmes, and the time licence fee payers spend on individual
services each week, rather than just 15-minute reach figures.
(Paragraph 34)
This recommendation has two parts. The first sentence refers to
reach targets and the second sentence to performance data reporting.
The Trust's response also had two parts. Regarding reach targets
we stated that, "The Trust shares the Committee's objective
of transparency but does not set reach targets for individual
services. We set an overall target that BBC services as a whole
should reach 90% of the population but it is a matter for BBC
management to determine how each service should contribute to
this target". Regarding performance reporting we stated
that, "The Trust regularly monitors the reach of individual
BBC services and publishes its assessment of performance in the
BBC annual report. In line with the Committee's recommendation
we will review the information we provide and consider whether
additional measures of reach would give a better indication of
performance".
The Trust did not therefore undertake to review the use of reach
targets. However, it is in the process of reviewing the BBC's
performance reporting framework and the level and quantity of
data that is published as part of the BBC strategy review. This
review will conclude before the end of this year.
5. According to the Trust's service review for younger audiences,
the average amount of BBC Television viewing for teenagers was
24 minutes a day in 2008, compared with 75 minutes for all individuals.
What are the comparative figures for 2009-10?
RESPONSE FROM
BBC MANAGEMENT
The figures for the average amount of viewing for BBC television
in 2008 reported in the BBC Trust's service review for young people
include the following services: BBC One, BBC Two, BBC Three, BBC
Four, CBeebies, CBBC, BBC News Channel, BBC Parliament. The BBC
HD Channel was not included.
The average amount of BBC television viewing (excluding the BBC
HD Channel) for 2009-10 are as follows: 23 minutes a day for teenagers
(13-19 year-olds) and 74 minutes per day for all individuals.
Source: BARB, average minutes viewed per day of BBC television
by 13-19 year-olds and all individuals 4+, financial year 2009-10
(30 March 2009-28 March 2010 minus week 53 owing to BARB panel
change) and 2008 (31 December 2007-28 December 2008). BBC television
includes: BBC One, BBC Two, BBC Three, BBC Four, CBeebies, CBBC,
BBC News Channel, BBC Parliament and, where described above, BBC
HD Channel.
6. In the interests of transparency, will the BBC publish
details of its audience share figures in the next year's Annual
report?
RESPONSE FROM
BBC MANAGEMENT
Audience share figures for BBC services are already made public
and are published for television by BARB (http://www.barb.co.uk/report/index)
and for radio by RAJAR (http://www.rajar.co.uk/listening/quarterly_listening.php).
The BBC is currently actively exploring new ways in which it can
more regularly and consistently share in the public domain data
on the performance of its services. The BBC is scoping the nature
of the data to be made available and how frequently it will be
published. We expect to begin publication next year.
BBC THREE
7. What was the cost per user hour figure for BBC Three in
2009-10 excluding the hours viewed of acquired programming and
transfers from BBC One and Two?
RESPONSE FROM
BBC MANAGEMENT
BBC3 COST PER USER HOUR (CPUH) ADJUSTED FOR ACQUISITIONS,
REPEATS & IPLAYER
| 2009-10 | 2008-09
| 2007-08 |
| Content Spend (£m) | 87.5
| 87.3 | 96.5 |
| CpUH as in ARA (pence) | 8.6
| 10.6 | 13.0 |
| CpUH without acquisitions & other channels' output (repeats) (pence)
| 16.5 | 19.1 | 21.0
|
| CpUH adjusted to include costs and viewer hours of BBC Three output on other channels (pence)
| 15.2 | 17.0 | 19.2
|
| CpUH adjusted to include viewer hours of BBC Three output on iPlayer (pence)
| 14.0 | N/A | N/A
|
8. In 2009-10, what were the 15-minute and 30-minute weekly
reach figures for BBC Three among (i) 16 to 34 year olds and (ii)
its overall audience, when acquired programmes and programmes
transferred from BBC One and Two are excluded?
RESPONSE FROM
BBC MANAGEMENT
When acquisitions and transfers from BBC One/BBC Two are removed,
69.9% of the channel's programming remains (in terms of programme
minutes broadcast). This is programming originated for the channel.
15-minute (consecutive) average weekly reach to programming excluding
the acquisitions and transfers stands at 2.2 million 16-34 year-olds
(that is 57.3% of BBC Three's average weekly reach to 16-34 year
olds before the exclusions) and 6.1 million individuals overall
(that is 52.7% of BBC's Three average weekly reach to all individuals
before the exclusions).
Unfortunately we are unable to provide the 30 minute consecutive
average weekly reach figure as requested. This is because the
industry software we use for this kind of analysis would automatically
exclude any programme of under 30 minutes when calculating 30
minute consecutive average weekly reach. This would mean that
the reach figure generated would exclude not only acquired programming
and that transferred from BBC One and Two but also all BBC Three
originations of under 30 minutes in length. We would be happy
to explain the technical issues in detail to officials.
Source: BARB, 15 mins consecutive average weekly reach
among all individuals 4+ and 16-34 year-olds, financial year 2009-10
(30 March 2009-28 March 2010 minus week 53 owing to BARB panel
change).
Reach of BBC Three calculated excluding acquisitions (= films
and programmes acquired by the BBC) and programmes transferred
from BBC One and BBC Two (= narrative repeats and repeats of programmes
on BBC Three previously shown on BBC One and BBC Two and first
showings on BBC Three of Spooks as this is primarily a
drama associated with BBC One).
NB: The definition of 15-minute consecutive reach used for this
analysis differs slightly from the channel reach figures provided
in answer to question 3. This is because this is a more complex
analysis only possible using a different application which bases
channel reach on an individual watching the specified minutes
consecutively of one programme and automatically excludes programmes
of less than the specified reach minutes. This is different from
the industry standard application for calculating channel reach
which bases reach on an individual watching the specified number
of minutes consecutively of the channel—be that of one programme
or split over more than one programme as long as it is consecutive.
This application does not allow analysis at an individual programme
level.
SPENDING IN
NATIONS AND
REGIONS
9. The 2008-09 BBC Annual Report included a figure (£948
million) for the amount of licence fee spend in the nations and
regions outside of London in 2008-09. Why did this year's BBC
Annual Report not include an equivalent figure for 2009-10?
RESPONSE FROM
BBC MANAGEMENT
In 2008 the BBC Trust required BBC Management to adopt the Ofcom
definition of out of London production. In line with the approach
taken by Ofcom in its own reporting, the BBC has chosen to report
content spend in the nations and regions as a percentage of eligible
network output. This is reported in table 2-9 on page -39 of the
BBC Annual Report and Accounts 2009-10.
- The 2008-09 BBC Annual Report also included a table showing
BBC spend on BBC television programmes made in the nations and
regions (table 9 page 42 Part Two). The Committee would be grateful
for the table updated for 2009-10.
The updated version of table 9 (as featured on page 42 of the
2008-09 Annual Report and Accounts) is shown below:
| Nation | 2009-10
| 2008-09 |
| England | £325m | £329m
|
| NI | £41m | £36m
|
| Scotland | £110m | £98m
|
| Wales | £67m | £53m
|
| Total | £543m | £516m
|
10. In absolute terms, the amount spent on output in the nations
and regions outside London has decreased over the past three years
(from £984 million to £903 million). How has this decrease
affected the annual volume of content produced in the nations
and regions outside London?
RESPONSE FROM
BBC MANAGEMENT
The previously advised figure of £903 million was extracted
from the accounting records before these were finalised and should
in fact have been £960 million. The correct figure of £960
million represents a year-on-year increase when compared to 2008-09,
although slightly down on 2007-08.
The decrease over the two year period is substantially for the
reasons set out on page 6 of BBC Annual Report 2008-09: BBC
Trust's response to the Committee's Fifth Report of Session 2009-10,
namely, changes in the level of overhead allocation, efficiency
savings, the move of some Radio 2 operations out of Birmingham
and a reduction in expenditure on radio sports rights.
The total TV hours produced in the nations and regions increased
over the last three years from 8,382 in 2007-08 to 8,890 in 2009-10
Over the same period the total of radio hours produced in the
nations and regions decreased from 294,570 in 2007-08 to 282,794
in 2009-10.
PENSIONS
11. What proportion of licence fee income is it reasonable
to contribute towards staff pensions?
RESPONSE FROM
BBC MANAGEMENT
In line with an increasing number of organisations, the BBC intends
to reform its pension provision.
It does so within the context of the BBC Trust
having set stretching efficiency targets and a requirement to
maximise value for money in all BBC activities. Without pension
reform, the BBC's pension costs could rise from current levels
of around 3.5% to as much as c10% of the licence fee. The BBC
believes that this would be unsustainable and inappropriate for
the licence fee payer.
The BBC believes that its proposals will reduce the
cost to between 5% and 7% of the licence fee and will achieve
the right balance between providing affordable, competitive pension
benefits, whilst reducing risk and providing value for money to
the licence fee payer. In the long-term, once the deficit has
been eliminated, the BBC expects the proportion of the licence
fee spent on pensions to return to around current levels.
STAFF COSTS
12. In next year's Annual Report, will you include
a breakdown of headcount by salary band for all BBC employees?
RESPONSE FROM
BBC MANAGEMENT
The BBC is committed to increasing the levels of
transparency regarding pay. We already publish the names and actual
salaries of the top c100 managers in the BBC as well as details
of all senior management pay in salary bands
We do not intend to publish a full breakdown of headcount
by salary band for all BBC employees in next year's annual report.
However, salary ranges for staff grades are published on our internal
web site and we provide information on average salaries annually
to the recognised unions.
We continue to work towards greater levels of transparency
in our pay data and over the next 12 months expect to publish
further salary information.
BBC CHARITIES
13. What is the rationale for maintaining no
more or less than four BBC charities?
RESPONSE FROM
BBC MANAGEMENT
The BBC engages in a wide range of charitable activity
including its own charities, charity partners and access appeals.
The BBC's family of charities are Children In Need, the World
Service Trust, Restoration Fund, Performing Arts Fund and the
Wildlife Fund. In general, these charities raise funds from the
general public via BBC programming. The exception is the World
Service Trust: whilst this charity partners with the World Service
it is funded by external grants, mainly from the Department For
International Development, the European Union, UN agencies and
charitable foundations.
There is a strong historical and heritage element
to some of our charities. For example, Children In Need was established
as a registered charity in 1989 but the BBC has been running televised
appeals for children since 1955 and radio appeals for children
since 1927. However, some of our other charities such as Restoration
Fund, the Performing Arts Fund and the Wildlife Fund have been
established more recently in conjunction with specific editorial
propositions. These charities were established following advice
from the BBC's independent Appeals Advisory Committee to ensure
impartiality and to minimise reputational risk to the BBC. The
purpose in setting up a new BBC charity is to ensure that all
monies raised are distributed equitably to a basket of charities
based on need. There is a clear understanding that some of these
charities will raise monies, distribute them and then cease to
exist. For example, the Restoration Fund is likely to close down
in the next couple of years. Also the BBC is currently in discussions
with the Wildlife Fund about whether it can continue to support
it with a broadcast appeal.
As the Director-General made clear to the CMS Select
Committee in September, the BBC does not intend to continue setting
up new charities every few years. As the World Service will be
funded directly by the licence fee from 2014 the BBC must now
consider how the World Service Trust should operate more directly
within the BBC's family of charities. This might also be an appropriate
opportunity to look at all our current charitable activity to
ensure that the BBC's direct involvement is proportionate and
fully justifiable. We would undertake such a review reporting
to the BBC Trust.
STAFF SURVEY
14. The Committee would be grateful for a copy
of the results of the staff survey referred to in Q10 of the evidence
session.
The survey is attached as a separate document.[12]
EXTERNAL CONSULTANTS
15. How much has the BBC spent on external consultants
over each of the past five years?
RESPONSE FROM
BBC TRUST AND
BBC MANAGEMENT
The amount the BBC—both Trust and Management—spent
on external consultants over each of the past five years is as
follows, excluding secondments, project management and external
audit is as follows:
| Year | Total
|
| 2005-06 | £9,223,310 |
| 2006-07 | £9,055,154 |
| 2007-08 | £9,403,821 |
| 2008-09 | £9,660,972 |
| 2009-10 | £8,914,211 |
DIGITAL SWITCHOVER
16. The BBC Director-General told the Committee that the BBC's
digital television channels "have made a significant difference
to people wanting to take digital television up". What research
does the BBC have to support this?
- How many homes have taken up digital TV, which otherwise would
not have done do, due to the BBC's digital channels?
RESPONSE FROM
BBC MANAGEMENT
It is not possible to estimate the number of homes that have taken
up digital TV thanks to the BBC's digital channels. However, the
value of digital television content in general—and that
of the BBC in particular—in encouraging take-up of digital
television has been well-documented, as far back as a viewer's
panel report for the DCMS in 2001: http://www.digitaltelevision.gov.uk/pdf_documents/publications/DCMS_digital_tv_e.pdf
Ofcom's analysis of the impact of the BBC's new digital services
on digital take-up from 2004 concluded that—in the context
of Freeview becoming the fastest-growing digital platform—"Overall,
it is our view that, although the precise impact is hard to quantify,
the BBC can take a substantial amount of the credit for DTT's
success since its relaunch. The BBC's new services have certainly
pushed DTT take up much faster than if they were not there (in
both radio and TV)." This report cited evidence from
a BBC / TNS survey which showed that "the new digital
BBC services were a significant factor in the purchasing decisions
of many new Freeview customers".
A DTI report from 2004 into attitudes to digital switchover showed
that BBC channels (News 24, BBC Three, BBC Four) were in the top
10 of channels that people in non-digital households would like
to receive / try out:
http://www.digitaltelevision.gov.uk/pdf_documents/publications/AttitudestoSwitchover_300304.pdf
The digital switchover trial conducted in 2005 at Ferryside and
Llansteffan, concluded that "The key driver for digital
television and for acceptance of the ending of analogue transmissions
is the Content, not the Technology. Trial households liked the
additional services from 'trusted' brands (BBC3, BBC4, News 24,
ITV2, ITV3 etc). Digital radio services through the television
set top box were also well received".
http://www.digitaltelevision.gov.uk/pdf_documents/publications/Digital_SwitchoverTrial_Report.pdf
OPERATIONAL COSTS
17. Why is it that infrastructure and other non-content costs
for BBC television services account for around 22% of operating
costs, nearly double the 12% figure for the BBC overall?
RESPONSE FROM
BBC MANAGEMENT
The basis of calculation of these two figures is different. The
12% represents the proportion of overheads within the total BBC
cost base, excluding digital switchover (£406.3 million /
£3,475.4 million).
The 12% overhead figure forms a part of total Infrastructure and
Support cost, and it is this wider category from which the 22%
quoted here is derived. Overheads are the key element within infrastructure
and support costs, forming approximately half these costs. The
infrastructure and support category also include the costs of
marketing, press and publicity, libraries, learning support and
community events, and of central functions such as the BBC Trust.
These central costs are apportioned across the range of BBC services.
The allocation to television services for infrastructure and support
costs equates to 22% of overall spend allocated to television
for 2009-10. A full breakdown of this is shown in note 2b on page
2-101 of the BBC's Annual Report and Accounts.
EFFICIENCY SAVINGS
18. Are the efficiency savings which the BBC has reported
in its financial statements consistent with the NAO checklist
for reported efficiency savings within government?
RESPONSE FROM
BBC TRUST
Under the Agreement the NAO works with the BBC Trust on a programme
of value for money studies each year. In this respect the NAO
reports its findings to the BBC Trust. As the BBC is not a government
department there is no requirement for the BBC to report directly
to Government on the efficiency savings it has achieved and have
these audited by the NAO.
However, the BBC Trust has itself sought to ensure that the efficiency
savings reported under the BBC's current efficiency programme
follow recommended NAO best practice. To this end, in 2009, the
BBC Trust asked the NAO to review the metrics and systems used
by the BBC to monitor the performance impact of the BBC's Continuous
Improvement efficiency programme. These systems had been designed
by the BBC Executive taking account of the NAO's published criteria
for assessing efficiencies as set out under the CSR2007 "Value
for money" programme. When reporting on their review of the
design of the BBC's efficiency measurement systems, the NAO raised
no major issues with BBC systems and metrics, but did offer some
recommendations for improvement, as a result of which the BBC
responded by making minor changes to the way that performance
is reported to the Executive Board and Trust.
COST PER
USER HOUR
19. Is the cost per user hour figure for each BBC service
presented in the Annual Report based on content costs alone, or
does it also include distribution and overheads?
- If the cost per hour figure is base on content costs alone,
why are other costs excluded?
RESPONSE FROM
BBC MANAGEMENT
The CpUH calculation includes only content costs. This methodology
is used to demonstrate more clearly the incremental impact of
spending on each service. The distribution and infrastructure
and support costs are almost all cost neutral with regard to the
prioritisation of expenditure by service.
AUDIENCE PERCEPTIONS
20. The 2009-10 Annual Report states that in 2009-10, 37%
of viewers surveyed agreed strongly that BBC television programmes
are "original and different". What proportion disagreed
that BBC television programmes are "original and different"?
RESPONSE FROM
BBC MANAGEMENT
The full results rating BBC programmes as "original and different"
are as follows:
- 37.3% agree strongly (the figure quoted in the 2009-10 Annual
Report).
- 38.4% agree slightly.
- 9.6% disagree slightly.
- 3.4% disagree strongly.
- 11.3% no strong views.
Therefore, in 2009-10 the net agree that BBC programmes are "original
and different" is 76% and the net disagree is 13%.
Source: GfK NOP for the BBC from the Pulse panel of c.20,000
UK adults 16+, financial year 2009-10. Owing to rounding, figures
may not sum to 100.
PROJECT CANVAS
21. What actions are the BBC taking to facilitate access to
Project Canvas for other platforms?
RESPONSE FROM
BBC MANAGEMENT
Project Canvas has now been incorporated as a joint venture (YouView)
in which the BBC is a shareholder with a seat on the board.
YouView is a platform in itself and, as such, facilitation of
access for other platforms may not be the most technically efficient
solution or consistent with the aims of the venture. However,
competition is promoted by the platform through consumer electronics
equipment manufacturers (set-top box and television set manufacturers
can licence the technical specification and brand in order to
incorporate YouView into their products) and content providers
(who make their offerings available on YouView). The BBC continues
to publish its own linear channels and the BBC iPlayer product
to a wide range of platforms.
22. How is the BBC addressing concerns that Project Canvas
will distort the nascent market for internet-enabled television
platforms, and that the marketing budget is disproportionate and
tough for rivals to match?
RESPONSE FROM
BBC TRUST AND
BBC MANAGEMENT
The BBC's involvement in Project Canvas was subject to a rigorous
and broad-ranging approval process conducted by the BBC Trust.
This process included both an assessment of the Public Value likely
to be created by the propostion and also a Market Impact Assessment.
The Trust concluded that the adverse impact of Project Canvas
would be more than offset by the public value created by the BBC's
participation. At the conclusion of its approval process the Trust
set out conditions designed to ensure the proposition constituted
an open standard with the full engagement of the wider industry
and minimal entry controls for content providers.
Ofcom looked at the market effects of YouView (as a whole, including
the BBC's participation) and chose not to investigate further
at this stage. The OFT also concluded that Canvas did not qualify
for investigation under the merger provisions of the Enterprise
Act 2002.
Whilst the marketing activity of YouView is a matter for the venture,
the BBC is satisfied that the budget set aside for marketing is
realistic and consistent with a product such as this. Should the
marketing effort become disproportionate, the BBC will use its
influence as a board member to ensure the best outcome for licence
fee payers.
The BBC will follow its existing guidelines for cross-promotion
to dictate how YouView will be referred to on the BBC's own services.
23. What parental control mechanisms will Project Canvas deploy
to restrict under-age access to post-watershed materials?
RESPONSE FROM
BBC MANAGEMENT
Trust approval of BBC participation was conditional on the joint
venture providing appropriate information and signposting to enable
users to make informed choices about the suitability of content
wherever possible.
PIN-based access control will be implemented with the user able
to change the default PIN during the installation process. For
video on demand content, it is up to content providers to flag
their own content as inappropriate. YouView will require the PIN
to be entered prior to playing any content containing this flag.
Content delivered by linear broadcast is subject to compliance
with Ofcom's Broadcast Guidelines whilst video on demand content
comes under the remit of ATVOD, which is in the process of creating
its own content labelling guidelines.
The BBC will continue to monitor the way in which features are
implemented and be prepared to exert its influence at board level
should any issues arise.
It is worth noting that the iPlayer application is already using
a warning and opt-in password system to indicate material that
might not be suitable for all audiences. We expect that this system
will continue to operate within the iPlayer domain on YouView.
BBC ONLINE
24. As far back as 2004 a Government review (the Graf review)
concluded that the BBC should redefine the remit and objectives
for its online services. The BBC Trust conducted its own service
review of BBC online in 2008, concluding that BBC Online required
firmer editorial control and clarity of purpose. In July 2010,
in its BBC Strategy Review Interim Conclusions, the Trust again
reached the same conclusions. Why has it taken so long for the
BBC to devise and implement an online strategy with a clear editorial
rationale?
RESPONSE FROM
BBC MANAGEMENT
We have always had a clear editorial rationale for the component
parts of BBC Online, which have become key to the delivery of
the BBC's public purposes alongside Television & Radio. Output
in areas such as News Online, Sport Online and the children's
sites) have helped to establish BBC Online as one of the UK's
most widely used websites and the only UK website in the UK top
10.
The Trust's review (published 2008) acknowledged the overall success
of the service but required changes to its governance to ensure
more effective editorial direction and control. In response to
the review, management implemented a new system of management
controls, including the appointment of a Controller BBC Online
who assumed overall accountability for the service and much stronger
central management. This included a system of review to ensure
that each area of activity was distinctive in relation to the
rest of the market.
Since the Trust's review the nature and usage of the internet
in the UK has continued to evolve and given this the Trust challenged
management to further clarify the scope and remit of its online
presence when undertaking the strategic review. Putting Quality
First has further strengthened these management controls and sets
out a single strategy for BBC Online with three headline commitments:
- Halving the number of top-level domains.
- Reducing spend against the service licence by 25%.
- Doubling the traffic the site sends to others.
The Trust is currently considering management's proposed approach
to this strategy, which includes distilling the current range
of propositions into fewer, better products and setting demonstrable
boundaries for the service, with clarity on those areas of activity
which it will not undertake.
25. BBC Online expenditure rose by some 12% from £178
million to £199 million in 2009-10. Why did the BBC Trust
allow increased expenditure on the service, given the deficiencies
in Editorial rationale and clarity of purpose?
RESPONSE FROM
BBC TRUST
The Trust's review of BBC Online, which was published in May 2008,
found significant weaknesses in management's financial, strategic
and editorial oversight of the service. When the Trust approved
increased investment in March 2009 the Chairman said, in a published
letter to the Director General, that this approval was subject
to a new system of management controls being implemented effectively.
It was also made clear that should this new system of controls
either appear or prove to be inadequate it would regard this as
a serious breach of BBC Online's service licence requiring an
appropriate sanction, which might include withholding authorisation
to spend in any particular area of concern. No such breach has
as yet occurred but the Trust will be carrying out a review of
the new system of governance in 2011 which will include consultation
with stakeholders.
ACQUISITIONS
26. How much did the BBC spend on acquired overseas television
programming in 2009-10 and what does it expect to spend in the
current year?
RESPONSE FROM
BBC MANAGEMENT
In 2009-10 the BBC spent £93 million on acquired television
programming (as in the ARA chart 2-2). Of this £80 million
was acquired non UK programming.
In 2010-11 the BBC expects to spend between £75-85 million
on acquired television programming (it is difficult to be more
precise at this stage due to scheduling plans for the remainder
of the year and due to some deals yet to be completed). Of this
approximately 87% (or £65 million to £74 million) is
expected to be on acquired non UK programming.
As part of the recent Strategy Review announcements, from 2013
onwards, spend on imported programmes and films will be capped
at no more than 2.5p in every licence fee pound.
COMPLAINTS
27. The Committee has received correspondence alleging that
the BBC complaints process is lengthy and bureaucratic, and places
an inordinate amount of obstacles in the way of complainants.
How do you respond?
RESPONSE FROM
BBC TRUST AND
MANAGEMENT
At the first stage of the service, complainants are regularly
surveyed independently by IPSOS-MORI (eg Oct-Dec 2009, sample
750). Almost three quarters (72%) say that getting in touch with
the BBC to complain is very or fairly easy and this continues
to be consistent, suggesting that the first stage of the BBC complaints
service is accessible for most people.
Between April 2009 and March 2010, 94% of these complaints were
answered within 10 working days. A turnaround of 100% within 10
working days is unachievable because of the complexity of some
complaints and the need to investigate them. If complainants write
back to say they are unhappy with their response, they are told
how to take the matter further. Escalation remains low at 0.1%,
suggesting the complaints process is working for most people.
Complainants who do not consider their complaints to have been
satisfactorily resolved at Stage 1 can complain to the Editorial
Complaints Unit (ECU) within 20 working days of the final Stage
1 response, though later complaints will be accepted if there
is good reason why they could not have been submitted within that
period. This is consistent with Ofcom's practice.
The ECU is expected to complete 80% of its investigations within
the relevant target time (20 working days in most cases, and 35
working days for a small minority of particularly complex or difficult
cases). Inevitably, some investigations take longer to complete
than the time provided by the applicable target, but the ECU has
consistently achieved or exceeded the 80% figure in recent years.
No obstacle is placed in the way of complainants beyond stating
their complaints and sending them to the ECU by email or post.
However, complaints erroneously sent to the ECU in the first instance
are referred to other areas of the BBC for appropriate Stage 1
responses.
Having completed an investigation, the ECU writes to the complainant
setting out its findings and the basis on which they were reached.
It is then open to the complainant to correspond further with
the ECU or to appeal to the Editorial Standards Committee of the
BBC Trust. In either event, the complainant has an opportunity
to address any new points.
Editorial management is required to take appropriate action in
the light of ECU findings, and a note of the action is published
along with a summary of the finding at http://www.bbc.co.uk/complaints/ecu/.
The action will include broadcasting a correction where this is
appropriate and proportionate. Complainants who regard the action
as insufficient are able to appeal to the Trust's Editorial Standards
Committee on that ground.
Under Article 24(g) of the Charter the Trust is responsible for
setting the framework in which the BBC handles complaints. The
complaints framework applies to complaints about editorial issues,
fair trading, TV licensing, party election broadcasts, the BBC
Trust, the Digital Switchover Help Scheme and general complaints.
The Trust reviewed the complaints process in 2008 and keeps complaint
handling under review through its oversight role. It is currently
reviewing the framework in light of two years experience and complaints
handling best practice. This review will consider, amongst other
things, whether the handling of editorial complaints is timely
and whether any simplification of the process is necessary
28. Last year, the Trust's Editorial Standards Committee answered
less than half of the appeals it received within 16 weeks. The
Trust's General Appeals Panel accepted 28 appeals, but only completed
two within 60 days. How do you account for this poor performance,
and what are you doing to improve it?
RESPONSE FROM
BBC TRUST
The Trust acknowledged in this year's Annual Report and Accounts
that while the ESC had made improvements in handling within its
target timeframe, (up from 9% to 48% of appeals handled in time)
the figure was still low and that it would be making greater efforts
to improve this next year.
The Trust is the final arbiter in the complaints process and therefore
typically considers complaints that raise complex issues and may
require lengthy and sensitive investigation. So far, this year
we have seen further significant improvements the ESC has considered
48 appeals, of which 83% (40) were handled within the target 16
week period.
In terms of the General Appeal's Panel the Trust acknowledged
that the handling figures were disappointing but that significant
progress would be expected this year.
This year the GAP has accepted two appeals, both of which were
handled within the set timeframe. The Trust Unit has also considered
10 other appeals which it recommended did not proceed to the Panel,
of which five received their decision within the 20 working day
time frame. The five others all received their decision within
25 working days.
The review of the Complaints Protocol will address how the Trust
can improve performance against complaints handling KPIs.
LICENCE FEE
COLLECTIONS
29. Is the BBC monitoring, and seeking to enforce licensing
of, those without a TV licence who watch its live streamed output
online?
- If so, how is it doing so, and has it brought any prosecutions
of any unlicensed viewers?
RESPONSE FROM
BBC MANAGEMENT
A TV Licence is required to watch or record any television programmes
which are shown online at the same time as they are being broadcast
on television.
TV licensing enforces all requirements for a licence including
those who watch or record live television online without being
covered by a licence. Enforcement in this area is part of the
normal routine for Enquiry Officers and they are briefed as to
the circumstances that require a TV Licence when someone is watching
online. There have been successful prosecutions of people watching
online without a licence.
The vast majority of people (97%) own a television. Those who
are licensed for the main TV at their home address will also be
licensed to watch TV at home on a PC. The number of people who
only use a PC to watch TV is very small.
30. What changes, if any, would the BBC like to see in TV
licensing in light of online and mobile television viewing?
RESPONSE FROM
BBC TRUST
The question of whether such viewing should result in a licence
being levied on devices other than TV sets is a matter for the
government. However, as noted above in answer to question 29,
in terms of online and mobile viewing, as long as a household
already holds a licence, then that household will also be covered
for viewing online, or on their mobile phone. Given that only
0.3% of people consume TV only via the internet in a week, and
across a year that number is virtually zero, we think it unlikely
that online and mobile television viewing is a significant threat
to the licence fee at present. However, we will continue to monitor
trends in this area.
FAIR TRADING
31. With regard to fair trading, in the Annual Report the
Trust criticise the BBC for a lack of properly documented competitive
impact assessments. What measures are the BBC taking to address
this issue?
- What sanctions are imposed on BBC employees who fail to follow
fair trading procedures?
RESPONSE FROM
BBC TRUST AND
MANAGEMENT
The BBC has taken a number of steps to address this issue. These
include:
- updating its Fair Trading training programme to create greater
awareness of the need (and processes) for ensuring that the potential
competitive impact of proposed public service activities is properly
considered;
- updated internal guidance to inform on the approach and appropriate
level of documentation required in relation to Competitive Impact
assessments; and
- enhanced procedures for undertaking Competitive Impact assessments
in relation to specific types of activity including the acquisition
of sports rights, the BBC's online activities and syndication
activities.
Furthermore, as noted in the Report and Accounts, the Trust's
independent auditor has provided reassurance to the Trust that
appropriate improvements have been made.
The BBC takes a proportionate approach when considering its response
to a failure to follow Fair Trading procedures, based on the facts
of each case. If the breach was considered sufficiently serious,
disciplinary action could be instituted. To date no sanctions
have been imposed as a result of Fair Trading complaints/appeals.
1 NOP for the Committee on
Financing the BBC (Chairman: Professor Alan Peacock) for the Home
Department, 2,047 adults, October 1985 Back
2
TNS for the BBC, 2,163 UK adults 16+, August 2009 Back
3
ICM for the Guardian, 1,001 GB adults 18+, September 2009 Back
4
ComRes for Newsnight, 1,000 GB adults 18+, November 2009 Back
5
YouGov for Deloitte, 2,071 adults 18+, July 2009 Back
6
Kantar Media for the BBC Trust, 2,251 UK adults 15+, autumn 2009
/ spring 2010. Respondents answer on a four-point scale: 58 per
cent = value for money is the net of 15% saying "£very
good value" and 43% saying "fairly good value".
39% = not value for money is the net of 15% saying "not at
all good value" and 23% saying "not very good value" Back
7
ICM for the Guardian, 1,001 GB adults 18+, September 2009 Back
8
ComRes for Newsnight, 1,000 GB adults 18+, November 2009 Back
9
TNS for the BBC, 1,094 UK adults 16+ (household perspective),
1,069 UK adults 16+ (societal perspective), August 2009 Back
10
Ipsos MORI for the BBC, 4,577 UK adults 16+, May 2008 Back
11
Holden Pearmain for Ofcom, 1,217 UK adults 18+ (personal perspective),
1,257 UK adults 18+ (citizen perspective), June 2008 Back
12
Unprinted paper Back
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