Examination of Witnesses (Questions 124
- 139)
WEDNESDAY 23 MAY 2007
MR DON
FOSTER
Q124 Chairman:
Don Foster, welcome again. You have been to see us before. Could
we start with a general question on how you see the role of the
chairman of the BBC Trust. Do you see him as a regulator? I think
you used the phrase before "a flag waver". Which role
do you see him in?
Mr Foster: Can I begin by thanking you for inviting
me. You will recall that when I last came I discussed with you
my views on what the structure should be. I remember you gave
me quite a rough time and were slightly critical of my proposal
initially that there should be an independent regulator for the
BBC. I was delighted that your own report subsequently moved more
in that direction. I still hold to that view. I wish we had an
independent regulatory body of the BBC and indeed of other public
service broadcasters. Sadly we do not and we have the structure
the government introduced in which we have a person who has two
jobs. He is the chairman of the BBC and the chairman of the BBC
Trust. The whole concept of the BBC Trust being a sovereign body
of the BBC while at the same time having a quasi-regulatory function
remains for me a significant problem. I do not believe that the
new chairman of the BBC Trust is particularly now a flag waver
for the BBC. It is predominantly somebody who is looking after
the interests of the BBC licence fee payers. I accept that. It
also has a quasi-regulatory function. It leaves still the question
of who is the flag waver for the BBC and presumably that is now
the chairman of the operating board. That is the executive, Mark
Thomson.
Q125 Chairman:
Do you see any weakness in the present arrangement?
Mr Foster: I confess that I have been quite
impressed by the amount of work that the new Trust has got through
in a relatively short period of time, notwithstanding the loss
of the head of the operation when Michael Grade left. I have some
criticisms of some of the decisions that they have made. For example,
their decision to pull the plug on BBC Jam without even
having had any complaint issued to them whatsoever. I think it
was wrong of them to have agreed with the Freesat proposals without
going through the full PVT test arrangements. That said, some
of their other decisions and some of the processes they have put
in train I think have been quite impressive. It has been a mixed
picture so far. That does not alter any of my fundamental concerns
about the nature of the current arrangements whereby we do not
appear to have a clear role for an independent regulator of the
BBC from a body that is very clearly independent of the BBC. That
is what I would have wanted. We do not have it so inevitably I
do see that there are problems.
Chairman: You agree with that first example,
Lady Howe?
Baroness Howe of Idlicote: Yes. The first example
of BBC Jam was an amazing decision.
Q126 Chairman:
Explain to us what that was.
Mr Foster: BBC Jam was an online children's
or educational service that was on offer. There were concerns
expressed about it being anti-competitive with other possible
private sector operations. Those concerns were expressed, as I
understand it, to the European Commission. As I understand it,
none was directed to the BBC Trust and without even seeing the
nature of those complaints or even considering the content of
them in any way they decided initially to suspend BBC Jam
and then subsequently I think—I may have this wrong—some
200 members of staff involved in it have now had their services
dispensed with. That very important talent has been dispersed
to the four winds at a time when it was an initiative that I very
much welcomed the BBC being involved in.
Baroness Howe of Idlicote: It was also an initiative
which was particularly valuable on the teaching side and tied
in with helping some children, autistic and otherwise, have a
direct link and learn in that way.
Q127 Lord Maxton:
Is that not making it clear that the Trust is acting as a regulator?
If you had an independent regulator they probably would have taken
exactly the same decision because at least the BBC Trust has some
interest in the licence fee payer; whereas it is my view that
independent regulators are too interested in the financial interests
of other organisations in competition rather than in being involved
in what the BBC are doing.
Mr Foster: The premise of your question I entirely
accept. The decision in relation to BBC Jam would have
been one taken by an independent regulator in the same way it
was taken by the Trust. Where I have some concern however is that
it will not always be a totally independent regulator's decision
that is being made that takes into account the wide range of interests,
not just the commercial ones but the interests of licence fee
payers and others when the BBC Trust makes some of its decisions.
It can be questioned, for example, and is by some people. When
the Trust made its decision on allowing the BBC to go ahead with
its I Player scheme, there were certainly those who expressed
concern that the BBC should not be getting into the manufacture
of hardware, for example, and that that could be left to the market
and it might be in the interests of the public at large if there
witness statement more vigorous competition for the production
of such products. We know that Ofcom carried out their own market
impact assessment and the BBC Trust took that market impact assessment
into account, but in addition the BBC also did their own public
value test and it was the BBC that then decided how to composite
those two different tests to come to their final conclusion. A
body that is described as being a sovereign body of the BBC is
ultimately making the decisions. The issue even of the market
impact assessment does not necessarily hold sway.
Q128 Baroness Eccles of Moulton:
I believe you were in the audience from the beginning of the meeting
so you will have heard Michael Grade's very detailed description
of how the appointing process was followed when he was appointed
to the chairmanship of the BBC.
Mr Foster: I heard it but I believe he was somewhat
inaccurate with some of the information he provided you with.
Perhaps we can pick that up.
Q129 Baroness Eccles of Moulton:
The burden of the question is: do you believe that a privately
conducted appointment to a public corporation is an appropriate
and transparent method in the 21st century?
Mr Foster: No, I do not. If I could perhaps
give a bit of background to the procedure, there were two procedures
that were followed. The first was in relation to his initial appointment
as chairman of the governors and subsequently his appointment
to become the chairman of the BBC and chairman of the BBC Trust.
In the first appointment the first time round, it is worth recalling
as Michael Grade pointed out that the Secretary of State believed
that this was such an important public appointment that the normal
Nolan rules could be added to. That is when we heard that Dame
Renee Fritchie served as an independent evaluator. I very much
welcome that that was done. At the next stage when there was an
appointment to become the chairman of the BBC and the chairman
of the BBC Trust I understand there were again similar procedures
but three members of the Privy Council also played an independent
evaluation role in that procedure. I think that was missed out
of Michael's comments. I do believe that that gives us a potential
model for the future because I believe there is a role for Parliament
to play in those procedures. Whether it should be a body of both
Houses of Parliament that is the interviewing and appointing body—which
is something my party for a number of appointments has believed
is the right way forward—and whether that is quite the right
model I am not entirely sure but I certainly believe, perhaps
as an oversight responsibility, a committee of both Houses of
Parliament should be involved in the procedure. I confess I am
in two minds as to whether that should be the appointing body
or whether we should have the procedure that currently exists
with an oversight scrutiny body from a committee of both Houses
of Parliament.
Q130 Bishop of Manchester:
A moment ago you referred to inaccuracies that Mr Grade and you
did make a specific reference to one in your response. Are there
any other inaccuracies that you would like to develop?
Mr Foster: No. It was merely the additional
because I thought it was very important that there was that additional
process added when he became the chairman of the Trust. There
was this panel of three privy councillors—i.e., for the
first time a representation, albeit a small one, of Parliament.
Q131 Lord Hastings of Scarisbrick:
Can you expand a little further on the answers you gave previously
to the last questions around the role of Parliament? I am not
asking you to make policy on the hoof for your party but just
to think about how you would want to engage Parliament and the
public possibly in the role of the chairman of the Trust, given
that the role of the chairman of the Trust as defined by the new
Charter is to represent the interests of the licence fee payers.
Parliament can do that but how do you involve the public with
Parliament? The representatives, yes, but in addition to the representatives
how do you get that genuine sense of public questioning, concern
and interest? What process ought to be followed over what time
period?
Mr Foster: I confess that I would be developing
policy on the hoof were I to give a detailed answer to your question.
Let me give you a few thoughts. If you look back to the submission
that the Liberal Democrat Party made on the consultation about
the future of the BBC, we said very clearly in that documentation
that the appointment of the chairman of the oversight body, whatever
it might be called—now we know it is the Trust—would
be made by a joint committee of both Houses of Parliament. We
have subsequently had an opportunity to consider that in more
detail and confess that one of our problems is finding the answer
to the basic question: what is wrong with the current system?
Has it led to us getting the wrong people in post? Was there some
error of judgment in getting, for instance, Sir Michael Lyons
now in post? I have some difficulty saying I can see a problem
with that, other than the issue that you rightly raise of accountability
and public involvement. Members of both Houses are representatives
of the people and that is why I believe they should be involved
but increasingly I move to a view that perhaps it is more in an
oversight role rather than one of making the decision. One other
thing is critically important. That oversight role or even the
decision making role should not just be about the individual.
It must also be about the contract that that individual signs.
I think it is deeply worrying that when Michael Grade because
the chairman of the BBC and the chairman of the BBC Trust he did
not have a contract. It is almost unthinkable that we can repeat
that exercise. If you accept my premise that there needs to be
a contract, then it raises all sorts of other questions such as
the one you were raising with Michael Grade about the need to
incorporate within that gardening leave, whether you need to incorporate
issues in relation to confidentiality clauses and so on. I do
think there has to be an involvement of both Houses. That is not
just about the appointment of the individual but the contract
that is to be signed by that individual and indeed the very existence
of a contract. I hope that it will be pushing to ensure that there
is one.
Q132 Lord Hastings of Scarisbrick:
Taking your point therefore that there is a clear role for Parliament,
not just for the chairman of the BBC Trust, Mr Grade said he saw
himself as just the first among equals. Therefore, should not
the rest of the trustees who are all meant to be representatives
of the public interest also be subject to the same process? If
he is only the first among equals, should they also not be individually
scrutinised, questioned and contracts assessed?
Mr Foster: Whether or not he is the first among
equals, those other members of the Trust play a very critical
role, as we saw for example in the way Michael Grade resigned
and they were without a chair of the body. They were all continuing
on and a great deal of work was done in that time. However you
define them, they are all important. The very simple answer to
your question is yes, I do believe the same process should be
applied for all of them.
Q133 Lord Hastings of Scarisbrick:
In order to fulfil that process which could be cumbersome but
is vital and necessary, before appointment do you think there
should be a period of possibly three to six months for proper
scrutiny to be conducted?
Mr Foster: There would certainly need to be
a period of time. I am loath to make any suggestions to you that
might be deemed cumbersome because I recall that my proposals
to you last time about the structure were deemed by many of the
previous Committee to be extremely cumbersome. Whether they are
cumbersome or not, I think they are crucially important. During
that period of time, there is an opportunity for the public to
express their views about many of the issues surrounding the appointment
to those people who they will know are going to be involved in
that decision making process, which of course is part of the answer
to your earlier question in relation to public involvement.
Q134 Chairman:
Say it was a parliamentary body of some kind that asked questions
rather than appointed. What kinds of questions would they be asking?
Mr Foster: I suspect they would be asking very
much the questions that I imagine were asked by the people who
carried out the interviews under the current and previous procedures.
They would be questions in relation to the relevant expertise
of the individual. They would be looking at the references that
people have given and asking questions in terms of their vision
for the future: how do they see themselves conducting their role?
One of the questions I would always want to ask at an interview
is, "If you had been making some of the decisions that have
been made by your predecessor, would you have made the same decisions?
If so, why? If differently, why would that have been?"
Q135 Chairman:
Would political allegiance come into it?
Mr Foster: I certainly think it is important
that we know what political involvement there has been but I for
one am perhaps not quite so concerned about that as an issue.
Anybody who is going to serve us in public life probably has some
quite strong political views. How they have expressed them and
what they have done in terms of their involvement, membership
and activity within a political party may be somewhat relevant
but most people who are going to serve us well in public life
probably have strong views on a wide range of issues and long
may it always be the case.
Q136 Chairman:
So not a disqualification?
Mr Foster: Certainly not a disqualification.
Q137 Lord Maxton:
All Nolan application forms for public appointments ask for your
political affiliation.
Mr Foster: It also makes clear that it is not
a disqualification.
Q138 Lord Maxton:
I accept that, though I have to say with some Labour ministers
it tends to be a disqualification for anybody who is a member
of the Labour Party. I am not clear whether Parliament should
be involved in the appointment or in the oversight because it
seems to me there is a middle position between those two. One
is that there is a body that does the interviews and agrees on
one person and announces that is the person. At that point do
you think a parliamentary body should have them before, basically
on the American advise and consent procedure, so that they can
interview them before the final appointment is made; or do you
think it is the whole procedure and the new chairman, or whoever
it is, after the appointment is made? Which one is it?
Mr Foster: I understand your question entirely.
I think I was frank and honest enough to the Committee earlier
in suggesting that I do not have answers to your question. Like
you, I am currently stumbling around between the various models
that are there and I have not formed a firm conclusion. I will
therefore look with great interest at the recommendation that
comes from your Committee at the end and I apologise I have not
been too helpful to you in determining what the outcome would
be. What I think is important is that the current procedure is
inadequate, that there was a move in the right direction with
the introduction of the panel of three Privy councillors within
the process. I think it is important that we go beyond that. I
believe there is a role for Parliament but I am not as convinced
as I was, at the time I wrote the paper on behalf of my party,
that it is necessarily the best way forward to say it is that
committee of both Houses that makes the decision. Where therefore
that involvement of Parliament comes in the process I confess
I do not have a clear answer on and I apologise to the Committee
for that.
Q139 Chairman:
If you were the just appointed chairman of the BBC and we were
questioning you in the way that we are now, do you think that
would be a deterrent for people applying for the BBC chairmanship?
Mr Foster: I was extremely disappointed to hear
Michael Grade say that that would be the case. I think the person
that we want to head up the BBC Trust is somebody who would certainly
not fear that and somebody who would be more than happy to take
part in those sorts of public discussions. After all, if that
person is to be, as the current job description describes that
person, the guardian of the licence fee payers' interests, then
the licence fee payers need to know a lot about that person, to
have confidence in that person and to know how that person is
likely to react in particular situations. The only way that that
can be ascertained is by there being public hearings at which
that individual has the opportunity to answer questions about
those matters.
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