Examination of Witnesses (Questions 80
- 99)
WEDNESDAY 23 MAY 2007
MR MICHAEL
GRADE
Q80 Lord King of Bridgwater:
Are the names of these three independent people, including you,
public, or is that wrapped in impenetrable mystery?
Mr Grade: I have no idea. I would prefer not
to go there in case it was confidential.
Q81 Chairman:
It is public.
Mr Grade: Is it.
Lord Maxton: Surely, under the Freedom of Information—
Chairman: It is public in any event.
Q82 Lord Maxton:
You on several occasions have said that the new Board/Trust is
responsible to the licence-fee payer and the licence-fee payer
is entitled to know—but the licence-fee payer does not know—how
the BBC spends its money. I do not know how much Jeremy Paxman
earns. I do not know how much John Humphrys earns. He knows exactly
how much every politician whom he interviews earns. I do not know
how much he earns. Should I not know?
Mr Grade: No.
Q83 Lord Maxton:
Why?
Mr Grade: Because people who operate in a freelance
market for talent are entitled to confidentiality.
Q84 Lord Maxton:
You mean that they are entitled to ask about expenses. They are
a publicly-funded body. They are entitled to know about the expenses
of Members of Parliament, of Members of the House of Lords, about
civil servants salaries, even about your salary.
Mr Grade: Yes.
Q85 Lord Maxton:
But we are not entitled to know what they earn.
Mr Grade: No. It is a professional engagement.
They are offering professional services to the BBC in a free market
and it would completely destroy the BBC's ability to attract talent
if people knew their contracts were going to be published. It
is just unthinkable. Unthinkable.
Lord Maxton: Unbelievable.
Q86 Chairman:
It is your view that it is unthinkable their earnings should be
known.
Mr Grade: I think people are entitled to privacy
and confidentiality if they are professionals offering services
to the BBC.
Lord Maxton: You could argue that Members of
Parliament are offering services to their electorate.
Q87 Chairman:
What happens if with the contract with the BBC they are making
£200,000 or £300,000 and then, in addition to that,
they are making all kinds of sums on speaking engagements and
so on? Is the public entitled to know that?
Mr Grade: No, it is for the BBC to manage those
situations. It is not for the BBC to deny people earning what
they are worth and what they can command in a free market. It
is for the BBC to police any potential conflicts. In other words,
if a presenter on the Today show is doing a conference
for a big commercial concern and that commercial concern is then
in some public controversy and the Chief Executive is being interviewed
on the Today show, the BBC needs to know that one of its
presenters has been taking the shilling from that company.
Q88 Chairman:
You do not mind the idea of him taking the shilling from the company
before that?
Mr Grade: Unless the BBC has an exclusive arrangement,
which it would have to pay for, I do not see why the BBC should
try to deny people earning what they want.
Q89 Chairman:
The point of all this is the accountability.
Mr Grade: Yes, but that is an operating matter
for the Executive of the BBC, to ensure that no possible journalistic
conflicts or editorial conflicts can arise from any such arrangements.
The BBC lost Jamie Oliver originally because he decided to do
commercials for Sainsbury's. That is how the BBC lost Jamie Oliver,
because there was a conflict.
Q90 Chairman:
I think the point Lord Maxton was getting at was public accountability
and the accountability of the organisation to the public.
Mr Grade: The accountability is more than carried
out through the annual reports, which include salaries of executives:
what is paid to the non-executives and to the Trust and so on.
There is full disclosure in the annual report, but if the idea
is that the BBC is going to have to publish all the contracts
of all the artists you would just put the BBC out of business.
Q91 Baroness Howe of Idlicote:
Certainly you came with a very clear picture of exactly what the
chairmanship should be of this new Trust. You worked it through,
obviously, with the BBC itself and got to the point four years
later when it was all set except for the licence fee. It is a
little bit intriguing to think whether you perhaps yourself might
have preferred the job you were setting up for the Director-General,
rather than the one from which you finally escaped, as it were.
Would that be a fair comment, that you had actually provided something
which did not fit you and therefore did not want to stay?
Mr Grade: No. Under the new Constitution, the
Chairman of the Operating Board can be either the Director-General
or an independent and that is at the discretion of the Trust.
I argued, with my fellow Governors, very strongly that the Director-General
should chair the Operating Board, so that it was clear that it
was an executive board, so that there could be no confusion that
there were two Chairmen of the BBC. It is very clear: the Director-General,
as Chairman of the Operating Board, is the Director-General and
the Chief Executive of the organisation. If I had fancied that
job myself, I would have argued differently, and might have had
the choice, but I did not.
Q92 Baroness Howe of Idlicote:
In the end, you did not wish to stay in either of them.
Mr Grade: No, because the Chairman of the Trust
is the job where all the responsibility lies.
Q93 Baroness Howe of Idlicote:
The one thing that had not been agreed was the licence fee. That
could be quite contentious in the sense that you go at a moment
when it could have disadvantaged quite considerably. The authority
was no longer there. The sum was settled. These terms and conditions
at this very high level: presumably there is some unwritten agreement
of how this level of appointment behaves as well as a written
agreement for what you are going to be paid, the number of years
and so on. I wondered what your assumption was for how you behave
under those circumstances and not least whether there might be
a sensible clause that ought to be added to these things if they
are not already prescribed within the contract and there should
be a non-compete clause for a period of time.
Mr Grade: That is a matter for others to decide.
I played by the rules. Immediately I had made up my mind, when
I was offered this role, that it was something I wanted to do
I told the BBC because I could not have a situation where I was
"riding two horses". That would have been unthinkable.
As far as the licence fee is concerned, it stretches the imagination
a bit to think that the government would have moved its licence
fee number up or down, depending on whether I was there or not.
At the point at which I left there were no new arguments. All
we were waiting for really was a decision from the government
on what the licence fee would be. I have heard people say that
the government would have been scared that I would resign if the
licence fee were lower than we needed, to which I would say that
that certainly for me would never have been a resignation issue.
The government is perfectly within its constitutional rights to
set the licence fee. It is certainly not a resignation matter.
I would never threaten resignation anyway but it was not in my
mind. The only resignation issue for me would have been government
interference in the editorial or constitution of the BBC. The
licence fee certainly was not.
Q94 Baroness Howe of Idlicote:
In a more general sense these are very special appointments at
Privy Council level. I am just wondering whether there ought to
be rather more set out in these agreements than there appears
to be.
Mr Grade: I do not have a view. It is for others
to decide whether it is necessary or not. I do not think the BBC
has been damaged in any way by my appointment in ITV. I think
it is important for broadcasting that ITV is strong. I will try
and play my part in restoring the strength of ITV. It is good
competition for the BBC. I cannot see the problem.
Q95 Chairman:
How long was it when you left the BBC and you joined ITV? What
was the gap?
Mr Grade: About eight weeks.
Q96 Chairman:
That is very unusual, is it not?
Mr Grade: I was not an executive.
Q97 Chairman:
That is your distinction: that you were the non-executive chairman?
Mr Grade: Yes.
Q98 Chairman:
Then you were taking up an executive role?
Mr Grade: If the BBC had said that there should
be a longer period, I would have—
Q99 Chairman:
They never asked you to do that?
Mr Grade: No. They asked me to leave immediately,
which was perfectly proper, which I did. We agreed a starting
date. I could have started the next day if I had wanted to but
I did not.
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