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We on these Benches wholeheartedly support the move to Greater Manchester. However, it is another obligation that needs to be paid for and that the Government have placed on the BBC. Over the six-year period of the settlement, the BBC will have approximately £2 billion less than it said it needed to deliver the Government's White Paper vision. Is it not the case that under the settlement the bulk of the licence fee increases will not be spent on things that the viewers and listeners rightly want—fewer repeats, more landmark programmes and high-quality information, education and entertainment, which the BBC is mandated to supply and, given the opportunity, does so well—but be swallowed up by funding, in one way or another, the digital switchover and a move to Salford Quays. This is a black-and-white TV settlement for a digital TV age.
2.20 pm
Lord Davies of Oldham: My Lords, I am grateful to the two noble Lords who have spoken. I particularly welcome the noble Lord, Lord Howard, to his first significant contribution in the brief that he has taken on. I look forward to establishing a constructive relationship with him. He would do well to follow the fine example of his predecessor, the noble Viscount, Lord Astor, who graced these debates on many occasions.
The noble Lord, Lord Howard, asked me a number of specific questions. The final details on the switchover costs need to be worked through with the BBC and with the trust. That is one of the more challenging and difficult areas for the BBC. In speaking to that, perhaps I may also answer the allied question put by the noble Baroness, Lady Bonham-Carter, about why that is thought of as a broadcasting cost. The answer is that it is about broadcasting. It affects those who receive television signals. It does not affect and is not the responsibility of the general taxpayer. Not everyone in the country has a television licence. This is about enhancing the digital revolution and the extra provision that it will bring to all licence holders. It is therefore entirely appropriate that we define this as a broadcasting cost.
It is also appropriate to look to Britain's premier broadcasting organisation to give effect to a principle to which we all subscribe; namely that there should be universal access to the public sector broadcaster. That is why we are concerned that there is sufficient support for the elderly, the disabled and those who are less well off, so that they are able to engage in the digital switchover and benefit from it on the same basis as the rest of us in the United Kingdom.
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The noble Baroness, Lady Bonham-Carter, indicated that the move to Manchester is an additional cost, as indeed it is. She said that these things should be more open. The BBC made clear in its bid what it thought the cost of moving to Manchester would be. That has been taken into account in the settlement. The whole House will have derived enormous reassurance from the fact that the director-general of the BBC, on the one o'clock programme today, said that he had been in favour of the move to Manchester all along. It will bring all the benefits outlined in the Statement: broadening the regional remit of the BBC; encouraging the development of talent other than that close to the south-east and London; and generally bringing significant benefits to the north and north-west of England.
I understand that the Liberal spokespersons in this House and in the other place think that the Government should have rolled over and given the BBC everything that it asked for because, by definition, it is a wholly benign organisation. It is a highly respected organisation and the Government give way to no one in their admiration of the work of the BBC. We all recognise the premier role that it will continue to play in British broadcasting. However, licence fee increases have always been a bargaining process. The BBC has a right to identify what it would like to do in a world in which it has as many resources as it feels it can obtain from the Government’s decision on the licence fee. That is perfectly natural. How could creative journalists not think that they could use more money than the amount that they are likely to get?
By the same token, the Government have a responsibility to the rest of the community. They have a responsibility to other broadcasters. The noble Baroness summed up all other broadcasters as the Murdoch News Corporation, but there are other broadcasters besides the Murdoch concerns. They, too, have an interest in the costs of television, to which the BBC is bound to make a contribution on prices. They have an interest in the amount of resources available to the BBC because they are inevitably in a competitive position. The Government have to take that into account. Last but not least, the licence is a set fee for all licence fee payers. The Government certainly have an obligation to licence fee payers.
2.26 pm
Lord Fowler: My Lords, in the Statement the Minister said that the United Kingdom spends more public money on public service broadcasting than any other country in the world except Germany. It is fair to add that the BBC also provides the best public service broadcasting in the world, including Germany. I agree with what the Minister said—that there should be no automatic link between the RPI and the licence fee. Surely that does not mean that the Treasury can simply load costs on to the licence fee which are entirely inappropriate.
I listened to what the Minister said, but I still do not understand how it can be right for licence fee payers to cover the £600 million cost of helping the elderly and the vulnerable with digital switchover
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Lord Davies of Oldham: My Lords, I am grateful to the noble Lord, and I recognise the role that he plays in this House in chairing the broadcasting committee. He asked me why the costs of the enhancement of television through the digital revolution should be borne by licence fee payers. The answer is: because that is what it is—an enhancement of the opportunities which digital brings. It is a broadcasting concept. As for whether people should have access to television at all and why the television fee is dealt with for certain groups, it is a matter of being part of our citizenry and enjoying the same benefits as the rest of the nation. The noble Lord is not prepared to accept that distinction. On previous occasions I have heard him indicate that he does not accept that argument. That is the Government’s case and we will sustain it. The rest of the nation will recognise that taxpayers should sustain what is a broadcasting development. The Government will defend their position accordingly.
I also hear what the noble Lord says about the parliamentary contribution. In the course of these great debates on the licence fee, the development of the BBC, the governance of the BBC and all the aspects of that, I have not noticed that this House is particularly reticent about expressing its views on those matters. Nor has the noble Lord sat quietly in a corner while these debates have taken place. In fact, he has taken a lead in the exercise, to the great benefit of all who have to form a judgment on such matters. So of course Parliament has its role, both this House and also the Commons.
When it comes to the actual fixing of the licence fee, can we not conceive of a situation where locked into the room would be an eminently sensible member of the Government? There is the noble Lord, Lord Fowler, with his great interest in these matters and his very clear scrutiny of them; some of his colleagues, who are hostile to the concept of the licence fee altogether; and then the noble Baroness, Lady Bonham-Carter, who thinks the BBC should get all it wants. The situation is far too complex to be resolved by public debate alone. The Government have to reach a decision.
Lord Tyler: My Lords, I wonder whether other Members of your Lordships’ House noticed the short phrase that the noble Lord seemed to add to the text which we were given outside the Chamber. Was the phrase stating that a strong, independent BBC should be,
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the noble Lord’s own addition or was it the addition of the Secretary of State in the other place? I wonder whether he could spell out what exactly it means. To exactly whom is the BBC accountable, and through whom is the BBC accountable to the licence payer if it is not through Parliament, as the noble Lord, Lord Fowler, has just said? Is it not right that if we are to accept that concept of accountability, then Parliament should have a wider role in the eventual settlement, rather than being faced by a fait accompli such as the one this afternoon?
I wonder whether the noble Lord would like to say something more about the representations made by Mr Rupert Murdoch and his media empire, particularly on the question of the criteria for capability transfers to other public service broadcasters. As my noble friend Lady Bonham-Carter said, and it must be clear to all in your Lordships’ House, Mr Murdoch has every interest in anything that weakens the BBC. That is his commercial interest and surely the Government must recognise that.
Finally, is the Minister confident that this settlement will enable the BBC to deliver precisely the improved and enhanced service of the parliament channel called for by the commission under the chairmanship of the noble Lord, Lord Puttnam, on which I was very pleased and proud to serve? If this House and the other place are to communicate more effectively with the public, very important investment has to be made in those services. Can the Minister assure us that this settlement will secure that?
Lord Davies of Oldham: My Lords, on the latter point, that is a decision for the BBC. That is the whole point of the independence of the BBC; neither Parliament nor Government dictates to it on the question of programming content. But of course the BBC is mindful of these representations from parliamentarians and is well aware of its obligations. The noble Lord has added his voice to that.
I have nothing to add on the Murdoch position. Of course Murdoch’s enterprises are an important player in the media in this country and they enjoy a situation where they prove to be more competitive than the BBC. This has been shown in the great struggle over the broadcasting of major sporting events and a highly competitive bidding process in recent times. I return to the point I made earlier. Murdoch’s enterprises are only one dimension of this. There are other aspects of independent television and other broadcasters. The BBC has an obligation to look at the picture in the round.
The noble Lord asked me whether I had added to the Statement. No, I did not. What I did add was what the Secretary of State added when she was on her feet. I would not be so rash as to offer any interpretation of my own on that front.
Lord Hurd of Westwell: My Lords, the Minister is answering questions in his usual courteous and comforting way but I am not sure I heard him answer the question put by my noble friend about the loss of jobs in London as a result of the move to Salford. Fifteen-thousand gained in the north-west—how many lost in London?
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Lord Davies of Oldham: My Lords, the BBC is presently evaluating its position on the workforce in London. The noble Lord will recognise that under the existing funding arrangements it is having to make some tough choices. The expansion of opportunities represented in Manchester will not obtain in London if the jobs and the activities are to be located there. So it is a transfer of responsibilities. But as the noble Lord will also recognise, the commitment of many broadcasters to the aspects of BBC television that are going to Manchester mean that many will go to Manchester to carry out their functions there.
Baroness Howe of Idlicote: My Lords, many of us welcome the acceptance of the move to Manchester. There was some doubt about whether it would happen. I would like to be reassured that the finances for the World Service, both television and radio, will be continued, and that there is proper agreement on that. I would also like to stress that the cost of switchover for the elderly and disabled will not be accepted by this House because it quite obviously should come out of general taxation. But perhaps the Minister can help me by saying what will happen about the broadcasting black spots around the country. When switchover takes place, who will be responsible for that, and is there a realistic estimate of just how expensive it will be to deal with? I would be grateful for answers.
Lord Davies of Oldham: My Lords, as the £600 million costs involved in the switchover are about seeking to create universal access to the public broadcaster, the noble Lady is right to say that there are areas where transmission signals are currently not effective. We will look to provide the best universal service that we can. That will mean some enhancement, and the costs built in to switchover take that into account. On the World Service, both this House and the other place constantly attest to the very great value the World Service provides not only to British listeners, who greatly enjoy the programmes, but as an independent truth-teller on world events. So many people rely on the BBC for their understanding of what is happening in the world, often in very troubled circumstances. The BBC is all too well aware of the extent to which the informed public put a very high value on the World Service.
Lord Watson of Invergowrie: My Lords, the Minister quite rightly referred to the premium role in broadcasting enjoyed by the BBC. I am sure that he will agree with me that that applies no less to the BBC’s output in Scotland—although that has been questioned recently following the 15 per cent cuts instituted over the past two to three years, which has led to job losses and, some would say, a diminution in some programme content and quality. Given that the licence fee increase which the Government have announced today falls some way short of what the BBC were seeking, albeit that that was no doubt embellished for purposes of negotiation by the BBC, will the Minister undertake to speak with the Minister for Culture, Media and Sport, the BBC director-general and the new BBC Trust to ensure that this
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Lord Davies of Oldham: My Lords, I am grateful to my noble friend for that representation. He has confirmed the BBC’s very important role in the range of services it provides across the United Kingdom. I know that there were expressions of doubt about the move to Manchester, but could there be a stronger commitment to the BBC’s regional role and the universality of it position, which also affects Scotland, than its determination to effect this move?
Perhaps I may offer a correction on one point. Unfortunately I slipped in my answer to the noble Baroness, Lady Howe. I wanted to emphasise that it would be very remiss of the BBC Trust if it did not take into account the general opinion about the World Service, but the World Service gets its resources from a Foreign Office grant and not from this settlement.
Lord Maxton: My Lords, I welcome the licence fee settlement that the Minister has announced this afternoon. I believe that it gives the BBC the income that it will require to carry out its services in the way it has done in the past, but does not impose unnecessary burdens on the licence fee payer, as I think the BBC was suggesting. I do not believe that the £600 million will not cover the costs of digital switchover. Arguably, the costs will be considerably less than that. Given the speed with which digital take-up is already taking place, by 2012 there may be few people left to give the service to. That is to be welcomed. However, my concern is that, in the rapidly changing technological world in which we live, where broadcasting is increasingly becoming what I suppose could be called “narrowcasting”—in other words, we watch programmes when, where and how we want to—the Government and the BBC must constantly review services, in particular looking at digital switchover, to ensure that the right technology is being used, so that in 2012 those few people are not left using a technology that is so out of date that it will be almost useless to them.
Lord Davies of Oldham: My Lords, I am grateful to my noble friend, who always exists at the cutting edge of technology and therefore helps to inform our deliberations. He is right: 70 per cent of British households have already switched to digital, so the costs may decrease as people voluntarily move over before the switchover date. Nevertheless, I think that the £600 million is a realistic estimate. We have also indicated that, if there are additional costs, we will look at that further. But I think that my noble friend has confirmed that today’s settlement is appropriate.
Lord Low of Dalston: My Lords, disabled people, perhaps especially blind people, have a particular interest in the issues with which the Statement is concerned and in broadcasting generally. Indeed, I
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That said, does the Minister agree that the BBC is a priceless asset? In fact, it is one of the few priceless assets that this country has left. It underpins the country’s cultural life in its widest sense through its acceptance of responsibilities that the market will not sustain. I was in general sympathetic to the remarks made by the noble Baroness, Lady Bonham-Carter, but I do not hold that the BBC should be feather-bedded; indeed, I am not sure that it was correct to impute that belief to the noble Baroness.
I invite the Minister to accept that the settlement that he has announced is very tight. In the new charter, which was agreed in advance of the licence fee settlement, many new obligations and responsibilities were laid on the BBC. The BBC is performing at the top of its game; it is already very efficient and cost-effective. In view of the additional responsibilities that have been laid on the BBC, a settlement of this order, which barely matches inflation, is likely to lead to some degradation of the service and make it difficult to keep up with technological developments. The Minister will perhaps understand why I am not the world’s leading expert on television technology—
Baroness Crawley: My Lords, perhaps the noble Lord could draw his remarks to a close.
Lord Low of Dalston: My Lords, I am none the less assured that there is new technology in the form of higher-resolution digital transmission, which it will be important for the BBC to be able to develop if it is to keep its place at the cutting edge of broadcasting. It seems to me that the settlement that the Minister has announced will make it difficult for the BBC to do that.
Lord Davies of Oldham: My Lords, I am grateful to the noble Lord for his representation on behalf of disabled people. The BBC is a valuable asset, but it is not priceless—that is the licence fee.
Lord Inglewood: My Lords, I ask the Minister to think back to the replies that he gave to my noble friend Lord Fowler and to the noble Lord, Lord Tyler. As my noble friend Lord Hurd said, he did so
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Lord Davies of Oldham: No, my Lords, it is democratically elected representatives of the nation having a view on the licence fee and the significance of the BBC.
Railways: Franchises
2.46 pm
Lord Chidgey rose to call attention to the present franchising system for the railway industry; and to move for Papers.
The noble Lord said: My Lords, some of your Lordships may remember that a while ago in another life I carried a record in the other place—one might say that I had form—as an opponent of the legislation that was to lead to the creation of Railtrack and the train operating companies. As the Member representing the railway town of Eastleigh at the time, I considered that to be a privilege as much as a duty.
Just for a moment, let me recall the flotation of Railtrack. The launch brochure described it as a one-off chance to buy into Britain’s largest development opportunity, with prime location property assets in every city centre in the country. Formerly, we knew those property assets only as railway stations, which served—incidentally, as it seemed in the Railtrack brochure—our national rail network. But time has moved on, and the arguments for and against rail privatisation now gather dust as a matter of record. Railtrack has sunk into the muddy waters from whence it came and, sadly, the Eastleigh railway works, which once employed thousands and around which the town was built, have closed for good.
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