Examination of Witnesses (Questions 1300
- 1313)
THURSDAY 6 DECEMBER 2007
Mr Mark Thompson and Ms Caroline Thomson
Q1300 Baroness Thornton:
Could we turn to MyNow. We know that you intend to make efficiency
savings, something in the region of £155 million on BBC news
over five years. At the same time you are proposing to launch
a new local broadband service MyNow, which will cost, according
to the information we have, £300 million. I have to say the
Newspaper Society did raise some issues with us about doing that.
I would like to ask you to explain what that will do, how it will
work and what it will concentrate on. What is the gap in commercial
provision of local on-line services which you have identified
and feel the need to fulfil?
Mr Thompson: Firstly, the £300 million
figure refers to a cluster of services all of which have got the
working title of MyNow: MyNewsNow, MySportNow, MyLocalNow. MyLocalNow
is only part of the story and would not of itself cost as much
as £300 million. Over the last ten years the BBC has developed
a website, the centrepiece of which is a news website which people
have taken to in extraordinary numbers. Our website overtook Yahoo
this year in terms of its reach in the UK. We are just behind
MSN and Google is above them so we are the third most widely used
website in the country. The web is very rapidly evolving. It is
going to be available on mobile devices, or is already, as well
as PCs at home and in the office. It is becoming much more possible
to use the web as a way of accessing moving pictures and sound,
obviously Youtube and so forth, we have our own i-player. The
public are using the web and other interactive devices to engage
with broadcasters and other content providers in entirely new
ways providing us with news pictures, taking part in debates in
blogs and so on. The notion of MyNewsNow, MySportNow, is offering
our licence payers over the next five or ten years a much more
personalised convenient access to the content they are interested
in, available to them when they want it, where they want it, on
the device they want it. Part of that is a notion of, in a local
environment, doing many of the things that local radio does but
doing it in a way which is instantly accessible and also, and
this is one of the most important ideas, of giving people a local
lens through which to see much of what the BBC does. If we have
a series Coast, you can type in your post code and get a sense
of those aspects of the programme or things related to the bigger
programme Coast, which are things you can go and visit and get
engaged in yourself. In terms of local democracy, MyLocalNow is
potentially a fantastic way of getting people to understand and
get engaged in the local issues of the day. To be quite honest,
nobody is doing that currently in the market. We have been involved
in discussions over the last 18 months with the newspapers listening
quite carefully to their concerns, modifying our plans in the
light of their concerns. We will certainly attempt to come up
with proposals which we hope will feel very complementary to what
the market is providing and potentially actually offers opportunities
for the market.
Q1301 Baroness Thornton:
Personally I am very comfortable with the BBC doing this because
of your reputation as a trusted journalistic source and regulated
to do that. It is not clear at all to me that can be said about
commercial internet web sources of news. I do not have a problem
about that but I do think the Newspaper Society does have a point
about the plurality of local access to news and media and it would
be awful if local newspapers and those sorts of activities were
jeopardised.
Mr Thompson: A significant way into this service
will be map based. What is interesting is even if you take one
of our local radio regions, of which there are 40 in England,
if you look at the local newspapers available in each local radio
area there are often five, six, eight or ten local newspapers.
There are many more local newspapers per square thousand miles
than there could ever be BBC services. We would expect our service
to link to and complement local newspaper websites. If you want
to go down to the next level of locality, we will hand you over
to one of the local newspapers.
Ms Thomson: It is important to say that this
service will be subject to a public value test so there will be
every proper transparent process to evaluate the impact on the
market and ensure that the public benefit exceeds that. The cost
of the MyLocalNow service is likely to be cumulatively over a
period of about £100 million as well.
Q1302 Chairman:
To end where we began with the licensing fee and where that led,
the fact is that £600 million has been taken from the licence
fee for social spending, giving help to old people for digital
switchover. That is in contrast to free television licences which
comes from the Exchequer. It is a bad precedent, is it not, what
you have agreed to here?
Mr Thompson: We have rehearsed these arguments
before. The BBC I would say has a strong interest in the universal
delivery of its services and, therefore, we believe that switchover
and the switch to high powered digital transmission is a good
thing for the country but also a good thing for licence payers
to get all of our services. We have broadly been, as you know,
happy to accept a leadership role in many aspects of digital switchover.
The issue about whether or not that support should or should not
extend to the delivery of the targeted help scheme I feel, in
the end, is most appropriately answered by the BBC Trust on behalf
of the licence payers. I have seen the role of myself and my colleagues
on the executive board to deliver the mission that is set for
us by the Trust and ultimately by the government in the White
Paper.
Q1303 Chairman:
This was part of the negotiation, was it not, and presumably you
were taking a rather different view when you put your points in
the negotiation with the government.
Ms Thomson: When we did the negotiation with
the government, the BBC governors, who were the governing body,
set a series of criteria under which they would agree to do this
scheme, the principle one of which was that we would have ring-fenced
money for programmes and services and the programmes and services
would not be affected by it and that was the element of the negotiation.
Q1304 Chairman:
The point I make is this is money coming out of the licence fee.
There is no question about that. This money has come out of the
licence fee. £600 million is a pretty major amount and I
would have thought you would not be in favour of the licence fee
being sliced in that way.
Ms Thomson: We took the view, and the governors
took the view at the time of the licence fee negotiations, that
digital switchover was a completely unique experience and the
BBC had an obligation to make it work for everyone because we
are a universal service.
Q1305 Chairman:
If someone comes to the BBC, like the government, any government,
and says we would now like to top slice the licence fee a bit
more so that money can go for some wider television, a new publishing
venture, would you accept that as well?
Ms Thomson: I think that would be again up to
the BBC Trust as a representative of the licence fee payers as
to whether it would accept that. I do not see immediately that
it meets the same criteria of uniqueness that digital switchover
does. My advice to them would be it does not meet the same criteria
of uniqueness.
Mr Thompson: What I would say is one of the
great strengths of the system of funding for the BBC, unlike much
of the rest of the public sector, is that the people who pay for
the BBC, the licence payers, can relate fairly straightforwardly
the amount of money they pay in each year, each month, to receive
the BBC services and the services they receive. One of the ways
in which the BBC is directly accountable to the public is the
public can compare the cheque with what they see and hear and
work out whether they are getting good value or not. That is a
great strength in our system. Anything, included targeted help,
which makes that a bit more complicated brings with it a disbenefit.
The argument accepted by the Governors was that the particular
national objective of digital switchover meant that this was an
exception which was allowable, but generally I would say it is
undesirable that the straightforwardness and the clarity of the
relationship between the licence payer and the services they get
should be over-complicated.
Q1306 Chairman:
Traditionally the BBC has always been very wary of parliament
getting involved in anything to do with the BBC but the result
of that is that the licence fee is a straight deal between the
government and the BBC; parliament, to all intents and purposes,
simply does not get involved. There is regulation but there is
nothing much you can do with regulation except accept or reject
it. Do you think that if parliament had a greater role in this
particular proposition, and other propositions that might come,
they would get a much more critical reception here in parliament
and that might be to your benefit?
Mr Thompson: It seems to me that must be an
issue for parliamentarians and for successive governments to work
out. Parliament is sovereign. If parliament wants to do anything,
it is able to do that. If it wishes to change the way in which
the licence fee is allocated, parliament can do that. If there
was an enormous body of disquiet about this in parliament, they
merely have to come up with a bill and vote for it. The BBC has
always accepted it is a matter ultimately for parliament, the
elected government of the day with their mandate from the British
public, to decide on the level of funding of the BBC. I hope people
will understand it is not unreasonable for us to make our case
but we absolutely understand in the end it must be for government,
with parliamentary support, to decide what the level of the licence
fee should be. All I would say is the debate about the licence
fee and the level of the licence fee typically in recent settlements
has been very wide ranging and I suspect most views have been
heard. It may just be the final stage of it which has been a matter
for government.
Q1307 Chairman:
That happens to be the decision. It is lovely to have a nice wide-ranging
debate but it does not actually matter, it does not have too much
effect if it has no effect on the final decision.
Mr Thompson: There are not many forms of taxation
which are broken out into even as broad a forum as the floor of
the House of Commons. The final decisions about taxation of almost
every kind are taken by government.
Chairman: There is the Finance Bill and
that is debated and you can vote on it but not in this case.
Q1308 Bishop of Manchester:
It is not only a matter of the level of funding but how the money
is actually used by the BBC. If we can go back to the Commons
Public Accounts Committee, to which I referred earlier, that said
the BBC is not properly accountable and should be open to investigation
by the Auditor General. If I can quote from the report, it says
"There is still no satisfactory regime under which the BBC
is accountable to parliament for its value for money." You
may say all these things are a matter for parliament but you must
have a view on it yourself.
Mr Thompson: Firstly, if we talk about reality,
the reality is the National Audit Office now have done numerous
reports into different aspects of value for money in the BBC and
if you doubt this you must talk to the NAO. We have afforded them
answers to every question and access to any part of the BBC that
they have asked for. In my view, interest by or request by the
NAO into any aspect of the BBC's affairs will be completely acceptable
to the BBC Trust. I found the NAO's work extremely useful and
have no objection at all to the NAO inquiring into any aspect
of what the BBC does. There has been a debate as between the Board
of Governors, subsequently the BBC Trust, and the Public Accounts
Committee about the precise mechanics for how these studies are
commissioned. I cannot believe there has not yet been an example
of the NAO being interested in something and not being able to
do it. You should be clear that I and members of the BBC Trust
and other colleagues appear with splendid regularity in front
of the Public Accounts Committee, probably more than any other
body, to discuss the reports. The idea there is no accountability,
I have now been to nearly 30 parliamentary Select Committees since
I became Director-General three years ago. I do not know of many
public bodies where there is more interaction with parliamentarians,
which we welcome.
Ms Thomson: It might be worthwhile saying that
as a sign going forward, for example, the Trust has asked the
NAO to monitor our level of efficiency savings and how we are
achieving them year on year and do a report on that. You can see
from this that there is active engagement with the NAO. The issue
has always been about where the report is first received, and
it is first received back into the Trust. That is regarded by
the Trust as quite an important protector of the BBC's independence
which they are of course required by Royal Charter to support.
Having received it, it is laid before parliament and we appear
in front of the PAC and they are as rigorous with us as they are
with anyone else.
Q1309 Baroness Thornton:
I would like to go back to the discussion we were having earlier
about the top slicing of the licence fee. I have this memory that
earlier in our deliberations we looked at a report from the Chair
of the BBC Trust in which he did not rule out top slicing; certainly
he equivocated about it. At the time my thoughts were who is going
to stand up and say, on behalf of the BBC, "Over my dead
body" if there is something unreasonable or a proposal to
do that if he is not? Is it you?
Mr Thompson: You have to be quite careful. I
promise you I believe it is my job, wherever I can, to very strongly
defend the BBC's interests and, to be honest, that is what I try
and do. I believe there are very, very strong arguments against
top slicing the licence fee because you break the clarity of the
relationship with the public. Almost any system sees some kind
of new quango arriving, and so forth. There are powerful disbenefits.
However, it would also be wrong of the BBC to automatically assume
that its interests are the only issues in this debate. We are
going through a period where clearly there are serious question
marks about the sustainability of some of the aspects of the public
service broadcasting beyond the BBC. There are debates about plurality
in news, in regional news, in children's programmes, and so on.
I can quite understand why the Chairman of the BBC Trust might
not want to automatically and at the outset of that debate rule
out any one solution. I find it very hard to see how top slicing
the licence fee would not ultimately weaken the BBC and I do not
really see how weakening the BBC will help stabilise public service
broadcasting in this country. I would personally need enormous
convincing that top slicing the licence fee is the right way forward.
However, I also do not believe it would be a satisfactory world,
particularly in the provision of news, if the BBC was the only
provider of impartial authoritative public service news.
Q1310 Baroness Thornton:
It is not your responsibility necessarily to solve that problem.
Mr Thompson: I agree with that and I am clear
what my responsibilities are. Given that there is a debate and
there are serious questions, I can understand why at this stage
in the debate the Chairman of the Trust would not want to, at
the outset, rule out any possibility. I do not think you should
conclude from that that the Chairman of the BBC Trust is in favour
of top slicing.
Q1311 Baroness Howe of Idlicote:
When you first made your comment about it being for the Chairman
of the BBC Trust to make that decision, it did strike a chord
with me as being a slightly different position when we were last
looking at this and getting an answer. I hear what you said, we
have all heard what you said, about your own views but what you
are now saying is that ultimately it will be for the Chairman
to make that decision and then privately you will make your views
very clear.
Mr Thompson: This is no difference with the
historical Board of Governors. The BBC Trust is, as the Governors
were, the sovereign body. It is the BBC Trust which receives the
licence fee from the public. We come up with our strategies and
our proposals for spending it and delivering services and it is
the Trust which ultimately signs off on those strategies and holds
us to account for delivery of those strategies. That is no constitutional
change than the period before with the Governors. Perhaps it is
rather more clearly laid out than it was under the Governors.
In the evolution of the debate about the BBC public service broadcasting,
I and my colleagues will be very strongly taking part in that
debate. It would be wrong for us to do that in a completely blinkered
"we already know what the answers are" approach. We
should also be prepared to at least recognise and potentially
also certainly submit ideas about how some of these other problems
of plurality could be solved. At the end of the day, the BBC Trust's
view on this topic is going to be very important.
Q1312 Chairman:
The Chairman of the Trust, just for clarification, certainly from
what I heard at a meeting that he was addressing, has an open
mind on the subject of top slicing which seems a different point
of view than the one you are expressing. I do not say that critically.
It may be that had he been Chairman of the BBC, which I think
is a point that Lady Howe was getting to, he might have been putting
it rather more emphatically than were he Chairman of the Trust
which is half a regulator at least.
Mr Thompson: What I would say is the advantage
of this new constitutional system is with the Chairman of the
Governors of the BBC it was quite difficult to tell sometimes
whether they were there as a champion of the licence fee payer
and a champion of the ideals and public purposes of the BBC or
whether they were champion of the institutional BBC but under
this new system it is very clear that the Chairman of the Trust's
responsibilities are to the public and to the public purposes
laid out in the Charter. The person who is first and foremost
responsible for the BBC as a creative institution and its future
and its view is me. That is the difference. As I say, in the past
the Chairman of the BBC Governors had to ride both horses at the
same time and our new system is rather clearer.
Q1313 Chairman:
I had this sense we are not going to finish this conversation.
We opened it some months ago and I do not think there is a meeting
of the minds on this particular point. Thank you very much both
of you for coming. You have given your evidence, as always, in
a very clear way and we are grateful. We know you had to rearrange
your schedules to get the Committee in and I am grateful to you
for coming. Perhaps if we have any other questions we can write
to you about them.
Mr Thompson: Finally, if any of the Committee
members would like, we have one or two BBC3 programmes if anyone
would like to watch them.
Chairman: You will be pleased to know
we are circulating one in the weekly circulation, your prize winning
Gavin and Stacey.
| 
