BBC Charter Review

Business of the House – in the House of Commons at 12:39 pm on 16th July 2015.

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Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport 12:39 pm, 16th July 2015

With permission, Mr Speaker, I should like to make a statement. I have today laid before Parliament a BBC charter review consultation paper, copies of which are being deposited in the Libraries.

The British Broadcasting Corporation is cherished and admired, not only in this country but around the world. At its best, the BBC sets international standards of quality. Even in a multimedia age, its most popular programmes continue to draw the country together in a shared experience, as happened with the London Olympics and world-beating dramas such as “Sherlock” and “Doctor Who”. The BBC reaches 97% of the UK population every week. It has a pivotal role in helping the United Kingdom to reach every corner of the globe, as reflected in the recent report that found that the UK leads the world in terms of soft power.

The BBC is almost 100 years old. There have been many changes in that time, but the scale of change in the media sector over the last decade has been unprecedented. People are consuming a vast array of content from multiple sources, using technology that either did not exist or was in its infancy 10 years ago. Ten years ago, when a Government last conducted a charter review, millions of households still received just five television channels. Much of the social media that is now ubiquitous was, at the very most, at an embryonic stage. And few people owned the sort of devices that colleagues use daily, including in the Chamber.

One of the few things that is certain about the media landscape of the future is that we cannot be sure how it will look, not least because we cannot predict how much will stay the same. Predictions about the demise of television have proven premature, undoubtedly in part because technology has evolved but also because many people still enjoy sitting down to watch television in their living room. Radio also retains an important place in people’s daily lives.

The current BBC royal charter will expire at the end of 2016. This paper launches the Government’s consultation, which will inform a number of decisions that we need to take about the future of the BBC. The BBC Trust will play an integral role in this process, running a series of public seminars and events.

Fundamentally, we need to consider four questions. What is the overall purpose of the BBC? What services and content should the BBC provide? How should the BBC be funded? How should the BBC be governed and regulated? The BBC has six public purposes, set out at the last charter review. They are sustaining citizenship and civil society; promoting education and learning; stimulating creativity and cultural excellence; representing the UK, its nations, regions and communities; bringing the UK to the world and the world to the UK; and delivering to the public the benefit of emerging communications. We need to ask whether these purposes are still relevant and right.

One key task is to assess whether the idea of “universality” still holds water. With so much more choice in what to consume and how to consume it, we must at least question whether the BBC should try to be all things to all people—to serve everyone across every platform—or if it should have a more precisely targeted mission. Along with considering the mission and purpose of the BBC, we will consider whether the charter should also define its values, and what those values should be.

The public purposes set the framework for what the BBC should be seeking to achieve, and the charter and supporting framework agreement articulate what activities it should undertake to accomplish this. The upcoming charter review will look at whether the scale and scope of the BBC is right for the current and future media environment and delivers what audiences are willing to pay for.

Twenty years ago the BBC had two television channels, five national radio stations and a local radio presence. It is now the largest public service broadcaster in the world, with nine television channels, five UK-wide radio stations, six radio stations that reach one of the home nations, 40 local radio stations, and a huge online presence. The charter review will look at whether that particular range of services best serves licence fee payers. It will also assess what impact the BBC has on the commercial sector. There is evidence that the BBC helps to drive up standards and boosts investment, but also concern that public funding should not undermine commercial business models for TV, radio and online.

The BBC is highly used and valued by the majority of people in this country. But variations exist, and there are particular challenges in reaching people from certain ethnic minority backgrounds and in meeting the needs of younger people, who increasingly access content online. Variations exist among the different nations and regions too. These are issues that we will need to take into account throughout the process of the charter review.

The BBC’s global reputation is second to none and the BBC has a central role in determining how the UK is perceived internationally. Each week, BBC services reach more than 300 million people across the world, and the director-general has set a target of 500 million.

The charter review also gives us an opportunity to look at the content the BBC provides, both in terms of the mixture of that content and its quality. We will analyse the way that the BBC’s content is produced. It is essentially shaped by two main elements—the broader regulatory framework including the terms of trade, which set out how the BBC and other broadcasters work with independent producers, and the BBC’s quota systems. The BBC executive has already made some radical proposals that would remove quotas and turn the BBC’s production arm into a commercial subsidiary. Those and other reform options will all need to be considered as part of the charter review. We will also look at BBC Worldwide, which contributes a substantial amount of additional income to the BBC.

I turn now to the issue of BBC funding, a subject on which I know there are strongly held views. The licence fee has proven to be a very resilient income stream for the BBC, bringing in £3.7 billion last year, but it is not without its challenges. There is no easy solution to the broad question of how the BBC should be funded. The licence fee is levied at a flat rate, meaning that it is regressive. A subscription model could well be an option in the longer term, but cannot work in the short term because the technology is not yet in every home to control access.

Therefore, the three options for change that are viable in the shorter term are a reformed licence fee, a household levy, or a hybrid funding model. In the longer term, we should consider whether there is a case for moving to a full subscription model. All have advantages and disadvantages.

There are a number of other funding issues that the charter review will cover. I have already announced to the House that the BBC, rather than taxpayers, will meet the cost of free TV licences for over-75-year-olds. That will be phased in from 2018-19, with the BBC taking on the full costs from 2020-21. We also anticipate that the licence fee will rise in line with the consumer prices index over the next charter review period, but that is dependent on the BBC keeping pace with efficiency savings elsewhere in the public sector and it is also subject to whatever conclusions are drawn from the charter review about the BBC’s scope and purpose.

I am grateful to David Perry QC, who has conducted an independent review of the sanctions appropriate for non-payment of the licence fee. The “TV Licence Fee Enforcement Review”, which is being published today, has concluded that decriminalisation would not be appropriate under the current funding model. The Government will now consider the case for decriminalisation as part of the charter review. I am today laying the “TV Licence Fee Enforcement Review” before Parliament and placing copies in the Libraries.

More people—especially younger people—now access catch-up television exclusively online and without a licence. That is perfectly legal, as the existing legislation was drawn up when the iPlayer did not even exist. The Government have committed to updating the legislation. We will also analyse the merits of a contestable public service funding pot that would not just be limited to the BBC. And we will look again at what areas and activities should have their funding protected in future. Broadband roll-out, digital switchover, local television, the World Service and the Welsh language channel S4C were protected in the last charter period. As I announced the other day, the broadband ring-fence is to be phased out by 2020-21, and S4C will be expected to find similar savings to those in the BBC.

Finally, there is the question of how the BBC is governed and regulated. Any organisation as large as the BBC needs effective governance and regulation. There have been occasions when the BBC has fallen well short of the standards that we expect of it. Editorial failures in the light of the Jimmy Savile revelations, the aborted digital media initiative, and the level of salaries and severance payments are among the issues that have caused disquiet. A lack of clarity in the BBC’s governance structures has contributed to those failures.

The last charter brought in a new regulatory model, creating the BBC Trust, which exists to represent licence fee payers and hold the BBC to account. That structure has been widely criticised, and the chair of the BBC Trust has herself called for reform. There are three broad options: reforming the trust model, creating a unitary board and a new stand-alone oversight body, or moving external regulation wholesale to Ofcom. As with funding options, each of those has pros and cons.

While the BBC’s editorial independence must not be compromised, that does not mean that we are not entitled to ask whether the BBC could be more transparent and to scrutinise how the BBC relates to the public, Parliament and Government. Any public body should be fully accountable to the public. People should be able to give voice to how well they think the BBC spends public money—some £30 billion over the current charter period—and how well it meets its myriad other responsibilities.

The British Broadcasting Corporation is part of the fabric of this country and a source of great pride. We want it to thrive in the years to come. This consultation paper sets out the framework for what I hope will be a wide-ranging and informative national debate about the future of the BBC. I commend this statement to the House.

Photo of Chris Bryant Chris Bryant Shadow Secretary of State for Culture, Media and Sport 12:50 pm, 16th July 2015

I am grateful to the Secretary of State for foresight of his statement, which he very honourably gave us one full hour before he stood up. That is right. It is not what some other Ministers have done in recent years, so I am grateful to him.

The BBC is our cultural NHS. It is a beacon of accuracy and impartiality around the world. It is not just part of the national furniture; it is our greatest cultural institution. It is a miracle of constitutional engineering: independent of Government, yet funded by the public. It is the cornerstone of our creative industries, earning respect and money for Britain and British values. As the Secretary of State said, it drives up standards and boosts investment. The public love it and want it to inform, educate and entertain—and yes, that includes making “Strictly”, “Top Gear”, “The Voice”, “The Great British Bake Off” and big British sporting events on BBC Sport.

That is why the Government’s attitude to the BBC rather mystifies me. The Secretary of State says that we should consider the matter of universality—the universality of the BBC. But surely the golden thread that runs through the concept of the BBC is that we all pay in and we should all get something out, including my constituents as well as his—those who like opera and those who like soap opera. He seems to accept that the licence fee should remain in place for the full period of the next charter. That is what I understood him to say. Can he confirm that clearly now? When will he close the iPlayer loophole, which he referred to last week, and what legislative method will he use?

Referring to the promised £145.50 plus CPI interest rate increase in the licence fee, the chair of the BBC Trust said:

“The word of a chancellor and a secretary of state you should be able to trust”, but the Secretary of State seems to cast doubt today on that deal. So what is it, deal or no deal? Will it be £145.50 plus CPI interest rate or not? [Laughter.] I am glad the Secretary of State liked that one.

The Secretary of State says that the funding of S4C was protected in the previous charter period. That is not the view of anybody in Wales. It was not. It has actually been cut by one third since 2010, and he has just suggested that the further 20% cut to the BBC will mean a similar shrinkage to S4C. The proposal is barely mentioned in the Green Paper, so I presume that he is not really looking at it with any seriousness. Will he consult the Welsh Government and the Welsh people on the future of S4C and make sure that its future is as guaranteed as that of the BBC?

The Green Paper asks whether the BBC should still broadcast Radio 1 and Radio 2. Where is the audience demand for that? Are people shouting: “What do we not want?”, “We don’t want Radio 2”, and “When do we not want it?”, “Now”? Of course they are not. Radio 1 and Radio 2 are the most popular radio stations in Europe. Why on earth is the Secretary of State even considering closing them down?

The Secretary of State says the review will look at the “scale”—his words—of the BBC, a point repeated on page 4 of the Green Paper. Will he confirm that this is in direct contradiction of the recent negotiations with the BBC, when he said he would look not at the scale of the BBC, only at the purposes of the BBC? Is his real aim a smaller BBC? [Interruption.] I see the Minister for Culture and the Digital Economy nodding his head that it is his aim. I ask, because many will be worried that this is just what The Daily Telegraph predicted on 12 May, when it reported, “Tories go to war with the BBC”, because the Prime Minister was infuriated with its election coverage. Would it not be profoundly unpatriotic to seek to diminish the BBC and thereby diminish Britain? Has any Member ever met a foreigner who has said, “You know what? I love Britain, I just hate the BBC”?

Photo of Chris Bryant Chris Bryant Shadow Secretary of State for Culture, Media and Sport

You go on the wrong holidays! [Interruption.] Yes, probably in Russia—or Italy under Berlusconi.

There are some things that we can agree on. The BBC always needs reform. The trust is bust. These three weeks prove it. Either the chair lip-syncs the director-general or, frankly, she undermines him. Whatever the new structure, and I favour a unitary executive board with the primary regulatory role being met by a board of Ofcom, the next charter must ensure that the Chancellor’s backroom, gun-to-the-head way of doing Government business with the BBC can never be repeated. The BBC is not a Government plaything, nor should it be a branch of the Department for Work and Pensions. It belongs to licence fee payers, and the public should have a say in its future, as the Secretary of State himself wrote earlier this year. Will he make sure that that is the case in future?

This process has been utterly shabby from the outset. Since the Secretary of State stood at the Dispatch Box last week, he and his Department have breached the ministerial code: they gave the precise details of his plans to The Sunday Times last weekend; they issued a press release on Sunday morning laying out the membership of a new panel, which he has not even bothered to mention today; and they leaked the substance of and direct quotations from the Perry report to the Daily Mail yesterday. That means he has not just let you down, Mr Speaker, he has not just let the House down, but frankly he has let himself down. I would be angry, but I am just disappointed. Who briefed The Sunday Times and the Daily Mail? Was it a special adviser or a civil servant? Did the Secretary of State authorise the briefings? If not, has the relevant person been dismissed?

That brings me to the panel the Secretary of State has set up. They may all be talented and clever, but what process did he use to select the membership? It certainly was not the Code of Practice for Ministerial Appointments to Public Bodies. Did he just get out his Rolodex and invite along all the people he had dinner with sometime last year? Most of the panel members have a direct financial interest and a conflict of interest with the BBC. The panel is to look at the BBC as a news provider and consider whether it should provide Radio 1 and Radio 2, yet three panel members run internet companies, another was managing director of a radio station, one runs the Arts Council and is, therefore, effectively a Government employee, and another runs a newspaper group. All of them are in direct competition with the BBC. How can they possibly be independent? Like Blofeld in “You Only Live Twice”, the Secretary of State has lined up a tank of piranhas, but he has not quite reckoned with the ingenuity of M and Bond in the shape of Judi Dench and Daniel Craig, who lined up to attack him yesterday.

On BBC Worldwide, which the Secretary of Sate referred to in his statement, is he considering selling it off? On decriminalisation of non-payment of the licence fee, the Daily Mail said yesterday that the Perry report declares that it is “crystal clear” that the system should remain as it is. Is that an accurate quotation? The Secretary of State was very opaque on his plans, but will he follow the advice of the Perry report or not?

The whole point of the BBC is that politicians should meddle with it only on very rare occasions. Yes, it is accountable to the public through Parliament and, yes, the charter renewal process gives Ministers a moment of great power over the corporation. But I urge the Secretary of State to curb his self-confessed inner free-market zealotry. With power comes responsibility. I will stand with him if he genuinely wants to strengthen the BBC, but, where he acts to undermine it or diminish it, I and Opposition Members will oppose him every step of the way.

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

I thank the hon. Gentleman for his recognition of our wish to co-operate with him by supplying the statement in advance. It is my intention that his party should have the opportunity to play a full role in what I hope is, as I said, a debate about the future of the BBC. I agree with many of his opening remarks about the importance of the BBC; indeed, they very much reflect my own. I share his admiration for many of the programmes that he mentioned. Even if I wanted to close down “Strictly Come Dancing”, which I do not, it would be completely wrong for the Government to decide which programmes the BBC should and should not make. It is, however, perfectly legitimate to ask that BBC programmes be distinct—that is part of the BBC’s overriding purpose and an aspect that we will consider—but the charter review is not about specific programmes, however much certain newspaper writers would like to think it is.

On the hon. Gentleman’s specific questions, we have made it clear that the licence fee is frozen under the terms of the current charter. During the future charter period, it will not be possible to move towards a subscription model, or something like that, in the short term because the technology is not there, but we will consider whether in the coming charter we should examine how it might become an option in the future; but that is an open question. The other issue he raised, which is a more immediate challenge, was the iPlayer loophole. It is our intention to try to close that in the next year, and we will introduce legislative proposals to do so.

On the agreement with the BBC over the future rise in the licence fee, the words I used in my statement were precisely the words set out not only in my answer to the hon. Gentleman’s urgent question last week, but also in the letter sent to the director-general of the BBC. It hardly represents reneging on an agreement, when all we have done is re-quote what was in the letter.

On S4C, we have made it clear that we will consult the Welsh Government—and indeed the Scottish and Northern Irish Governments—during the charter review, although the question of funding for S4C is a distinct matter that will obviously be considered during the spending review and other things. Having said that, we will, as part of the charter review, be considering the BBC’s involvement in supporting and funding S4C.

On Radio 1 and 2, which the hon. Gentleman got very excited about, I certainly think there is a strong role for BBC Radio in providing a different type of genre and opportunity, including for unsigned bands, which would not have the same opportunity in the commercial sector. Radio 1 plays a valuable role in fulfilling that objective, and there is no proposal to close Radio 1 or 2. All these things are part of the wider debate about the BBC’s place in the broadcasting landscape, and however much people might wish the statement to contain details of exactly what the Government wish to do, it does not; it is part of a debate, and that applies as well to the question of scale and scope.

The hon. Gentleman asked if I was considering scope. We are considering it; it would be extraordinary not to, given the amazing change that has taken place and the proliferation of choice over the past 10 years. The question of whether the BBC still needs to do everything it set out to do 10 years ago seems to me to be a legitimate question. I am grateful, however, for his support on the reform of governance arrangements. I am interested that he has reached a conclusion, even if we are still open-minded about it, but I look forward to his giving greater details during the charter review.

The hon. Gentleman was very critical about the funding arrangements that my right hon. Friend the Chancellor and I agreed with the BBC, but I would draw his attention to the remarks of his colleague, the shadow Chancellor, who said:

“All public institutions including the BBC I think have to do their part. We have always said that sensible savings at this time are really important and I don’t think the BBC can be excluded from that.”

As for the hon. Gentleman’s claimed breaches of the ministerial code, I have to say that I am not responsible for what appears in The Sunday Times, the Daily Mail or any of the other newspapers, some of whose accounts of what is in the charter review process appear to be entrants for the Booker prize for fiction. On the advisory panel, I merely say that it is not a public body, but a group of individuals, each of whom has considerable experience and knowledge in their particular fields, and they are there to provide advice, nothing more.

Finally, the hon. Gentleman said that the BBC was very precious and that we should only meddle with it on rare occasions. I think that a charter review that comes around once every 10 years probably meets the definition of a rare occasion, and it is entirely appropriate, given that the charter expires at the end of next year, that we take this opportunity to have the very full debate I have set out today.

Photo of John Redwood John Redwood Conservative, Wokingham

Is it not now time for us to have a BBC England, to match BBC Scotland, and is it not the case that many people in England deeply resent the way in which their country is being balkanised and broken up under some kind of EU plan and that they do not want their much-loved broadcaster assisting the EU in doing that?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

On my right hon. Friend’s first point, the BBC has a duty to serve the nations and regions, and while there is a specific BBC executive responsible for England, nevertheless, as I suspect might become apparent during the debate, there is a strong feeling that the BBC needs to do more to serve particular regions. On the BBC’s role in any discussions on our EU membership, as he is aware, the BBC is under a duty to maintain objectivity and impartiality, which I hope it will bear in mind, particularly during what I suspect will be quite a controversial debate.

Photo of John Nicolson John Nicolson Shadow SNP Spokesperson (Culture, Media and Sport)

I thank the right hon. Gentleman for bringing his Green Paper before the House and for the opportunity to read it in advance.

There have been lurid headlines anticipating what the right hon. Gentleman might say, presumably because of the lurid comments made by so many of his BBC-phobic colleagues on the Tory Back Benches. In the event, however, the Green Paper asks a lot of the right questions, including: how to anticipate viewers’ changing needs in the light of new technology; how best to provide for the nations and regions, as well as for minorities and young people; why many management figures in the BBC are so horrendously overpaid—an excellent question; and, crucially, how to fund the BBC going forward.

It is the SNP’s belief that responsibility for broadcasting in Scotland should transfer from Westminster to Holyrood. Scotland collects £320 million of licence fee revenue annually, but the BBC is only given £175 million to spend in Scotland every year, which is manifestly unfair. I want to ask the Secretary of State two questions. Why was the Scottish Government not consulted and asked for their views in advance of the Green Paper, given Lord Smith’s recommendations? Secondly, on funding, he has presumably anticipated the effect a new funding model would have on the licence fee per household. It is currently £145.50. What would its upper cap be, per household, under any new system?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

The hon. Gentleman brings a particular knowledge and experience, as a former employee of the BBC, although I am sure he was not one of those within the corporation whom he recognised as possibly being overpaid. He raised two specific questions. On the involvement of the Scottish Government, the Smith commission agreement set out that there should be full consultation, and we are committed to that. I wrote to the Scottish Government about the terms of reference for the charter review, and I intend to remain in touch with them during the debate over the next three months. We are obviously interested to hear their views.

On the transfer of responsibility for the BBC to Holyrood, I point out that it is the British Broadcasting Corporation and that Scotland, although he might not wish it, remains part of Britain, so I fear I might disappoint him on that.

Lastly, the future of the licence fee will be considered during the charter review, and the hon. Gentleman can obviously make representations on that point, along with any other matters.

Photo of Damian Collins Damian Collins Conservative, Folkestone and Hythe

The Secretary of State set out the concerns about the governance of the BBC and mentioned three options for reform. Is it his expectation that the BBC Trust, as we know it today, will go as a consequence of the charter renewal and that there will be a new model for governing the BBC?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

It is fairly clear that the BBC Trust does not work in its present form. The shadow Secretary of State used stronger language than I did in saying that it is “bust”, but it is widely accepted that it is not working properly. What should replace it is an important issue that we shall consider in the course of the charter review. The need for change is clear.

Photo of Ben Bradshaw Ben Bradshaw Labour, Exeter

I welcome the right hon. Gentleman’s statement and the Green Paper which, on the face of it, certainly looks more balanced than I had feared and more balanced, I expect, than the Murdoch press had hoped. Will the Secretary of State reassure my hon. Friend Chris Bryant and his own critics in the other place—senior Conservative politicians—on the make-up of the advisory panel, which seems very skewed with people who have been hostile to the BBC? Also, how are the public, who are after all the BBC’s stakeholders, going to be let in to this conversation?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

I am grateful to the right hon. Gentleman for his opening remarks. The advisory panel is, as I said, an advisory body, and it does not play a formal role. As for its composition, let me point out that it includes, among others, the current president of the Voice of the Listener and Viewer, who is also the former chairman of Ofcom, and a former member of the BBC executive board. These are people who bring considerable knowledge and expertise. I think all fair commentators would recognise that they are well qualified to express views—but that is all they will be doing: expressing views. The responsibility for charter review remains with the Government. As for the involvement of the public, which the right hon. Gentleman raised and which is equally important, it is the intention of the BBC Trust to hold a number of public meetings. We hope that the trust will work to ensure that the public have every opportunity to have an input to the charter review process.

Photo of Jason McCartney Jason McCartney Conservative, Colne Valley

It was a pleasure to meet Professor Brian Cox, who was in Parliament yesterday to open the parliamentary education centre. Does the Secretary of State agree that his programmes, such as “Wonders of the Universe” and “Stargazing Live”, represent the BBC at its best because such programmes not only educate and inform, but entertain?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

I absolutely agree with my hon. Friend. I was sorry to miss the opening of the education unit; it was fantastic that Professor Cox was able to come. On the specific point, I share my hon. Friend’s admiration for those programmes. They help to fulfil the BBC’s purpose of educating, but as he has recognised, education is achieved much more easily if it can be entertaining at the same time. Brian Cox achieves both of those purposes.

Photo of Paul Farrelly Paul Farrelly Labour, Newcastle-under-Lyme

After last week’s raid on the BBC, I want briefly to quote from February’s Select Committee report “Future of the BBC”. The Committee recommended

“that the Government seek cross-party support for establishing an independent review panel now on the 2017 Charter, along the same lines as the previous Burns’ model, led by a figure similar to Lord Burns…We expect sufficient time to be allocated for this and for the development of, and consultation on, Green and White Papers”, yet we now have a rather different unilaterally announced panel, and a Green Paper issued, unlike with the last charter review, before any outside input or consultation at all. Will the Secretary of State explain why, for the second time in a week, he has so radically departed from what he so strongly recommended while Chair of the Select Committee fewer than five months ago?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

As the hon. Gentleman will be aware, the time available before the expiry of the charter is now quite limited. We want to achieve a debate, and in time to reach firm views for renewal, but it would be difficult to set up an independent advisory panel within the current time period. That is why we decided not to go down that road, although I stand by what is in the Select Committee report—that there is an argument for doing so. The advisory panel is not an independent panel; it is simply an advisory group to provide advice. What is much more important, as Mr Bradshaw suggested, is for the public to have a full opportunity to get involved so that we get as wide a cross-section of views as possible, and we have put arrangements in place to ensure that.

Photo of Julian Knight Julian Knight Conservative, Solihull

My right hon. Friend is to be congratulated on the launch of this extensive consultation process and the information laid before us today. It seems that there is little off limits. However, I and many of my Solihull constituents will be slightly disappointed that there are many mentions within the document of the Scots, Irish and Welsh, but little mention of the unequal position for the English regions, particularly the west midlands. For every licence fee bought in my region, we receive back only £14.50 in investment. Will my right hon. Friend assure us that he will press top-heavy BBC management to correct this unfair situation?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

I am aware of the widely held view that the BBC needs to do more to serve individual regions. In the case of my hon. Friend’s region, I know there was a recent debate on the topic in Westminster Hall, in which he participated. It is indeed wholly appropriate to consider this issue in the course of charter review, and I hope my hon. Friend will continue to make his points while that happens.

Photo of Nia Griffith Nia Griffith Shadow Minister (Wales)

No one on the obscurely appointed panel is from Wales. The Secretary of State has just said that he will consult the Welsh Assembly

Government on the charter review and that the funding is to be decided separately. He is anticipating a further 20% cut to S4C on top of the 32% already implemented since 2010. In view of all that, what guarantee can he give, or what structure would he like to see put in place to ensure, that S4C will have some funding for the future? Otherwise, it will simply be unable to plan ahead.

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

The funding by the Government of S4C, along with all the other elements of Government expenditure, will obviously be considered at the time of the spending review. There is a commitment for the next couple of years. I am aware of the concerns of S4C, and I briefly spoke to its chairman last night. I hope to have another opportunity to discuss this and other matters with him and his colleagues in the near future.

Photo of Peter Heaton-Jones Peter Heaton-Jones Conservative, North Devon

There is a great deal that I, too, welcome in this document. Does the Secretary of State agree that it would be a mistake if this became a debate solely—important though this is—about value for money, particularly as between the different services that the BBC provides? I specifically mention local radio, and there is a figure in the document that could be construed as meaning that BBC local radio is the most expensive of the BBC’s radio services. As someone who spent 20 years in it, I can say that it is a very efficient service. In my area, BBC Radio Devon is certainly greatly prized.

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

I completely agree with my hon. Friend about the importance of BBC local radio. It seems to me that it serves a very valuable purpose, which is not served by the commercial sector at all. As for the cost, I am not sure about BBC Devon, but my visits to BBC Essex certainly gave me the impression that it has not been blessed with huge amounts of cash in recent times.

Photo of Nigel Dodds Nigel Dodds Shadow DUP Spokesperson (Reform and Constitutional Issues), Shadow DUP Spokesperson (Foreign Affairs), DUP Westminster Leader

I welcome the Secretary of State’s commitment to consult the Northern Ireland Executive on the charter review. However, let me say on behalf of many of my constituents that there will be deep disappointment that there is not going to be an early move on the issue of decriminalisation and sanctions for non-payment of the licence fee. I think that is a big mistake. Will the Secretary of State assure me that this will happen as soon as possible? It is also our view that we should move as quickly as possible to the subscription model for the BBC and get rid of the regressive, unfair current funding arrangements.

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

I am grateful to the right hon. Gentleman, and I can give him the assurance that the Northern Ireland Executive will be involved in the same way as other Governments in the home nations. As for decriminalisation, Mr David Perry has produced an extremely thorough analysis. As I have only just placed it in the Library, I can quite understand that the right hon. Gentleman will not have had a chance to look at it, but it raises a number of quite serious problems with decriminalisation that would need to be addressed if we went down that road. The Select Committee report also identified problems, but the Perry report goes further in pointing out other practical problems that would need to be solved. I encourage the right hon. Gentleman to go away and look at that. The issue will be considered as part of the charter review, along with the future of the licence fee, which, as he has observed, has some disadvantages.

Photo of John Howell John Howell Conservative, Henley

I used to be a presenter for BBC World Service Television, so I am not one of the BBC-phobic MPs on the Conservative Back Benches, but I understand the need for reform. Independent production in this country is a particularly vibrant and healthy sector. Can my right hon. Friend assure me that during the review he will examine the relationship between the BBC and the independent sector in order to ensure that it becomes less bureaucratic than it is at present, and takes full advantage of that vibrancy and health?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

The growth of the independent production sector has been one of the outstanding successes of the last 10 years or so. It has been assisted in large part by the BBC’s independent production quota, and also by the terms of trade. Obviously there have been big changes, and we will need to examine those. As my hon. Friend knows, the BBC itself has come up with a proposal for 100% competition for all BBC commissioning. It is an interesting proposal, but my hon. Friend can rest assured that I shall bear in mind the continuing success of the independent production sector throughout this process.

Photo of John Martin McDonnell John Martin McDonnell Labour, Hayes and Harlington

In his statement, the Secretary of State did not make a single reference to the BBC’s staff. I find that surprising, given the concerns that he expressed in his previous role. The staff are now extremely anxious about their future because of the resettlement fee, and this will not reassure them. Will the Secretary of State tell us how he will ensure that they are involved more thoroughly in the consultation process?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

I think that members of the BBC Trust will have heard what the hon. Gentleman has said. I certainly think that members of the BBC staff, and, indeed, former members—a number of whom appear to be in the Chamber this afternoon—will have views that they will wish to contribute. I am anxious to hear from existing employees, and I hope that the a look at the Green Paper may reassure them a little, because its content is some distance away from what some reports suggested it would contain.

Photo of Matt Warman Matt Warman Conservative, Boston and Skegness

As a journalist, I had the pleasure of covering a huge amount of the BBC’s programme output, and, subsequently, the launch of the iPlayer. I thought that those were excellent services, but I also endured the launching of an endless stream of apps that seemed to have very little public value. The problem was that there was very little focus on the precise purpose of any specific product. Does my right hon. Friend agree that when it comes to services such as football on the BBC—which would serve very well on commercial channels— versus, for instance, a feature section on the website, we should be a lot clearer about what the BBC is actually for?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

I entirely agree with my hon. Friend. In its online activities, the BBC is operating in a highly competitive space where there are a large number of commercial providers, which is why there has been concern about its impact on commercial activities. That is something that we shall need to consider, as is the exact nature of BBC content. The content currently has to accord with one of the public purposes of the BBC, but it is fair to say that it is almost impossible to think of any programme that could not be deemed to meet at least one of those public purposes, so they may well need to be drafted more tightly.

Photo of Jonathan Edwards Jonathan Edwards Shadow PC Spokesperson (Treasury), Shadow PC Spokesperson (Business, Innovation and Skills), Shadow PC Spokesperson (Transport), Shadow PC Spokesperson (Foreign Intervention)

Of major concern in Wales is the future of S4C, which has made real-terms cuts of 36% since 2010. Today the Secretary of State reiterated his view that the channel needed to make further savings. Does he not recognise that further reductions could fundamentally challenge the future of S4C and the independent production sector in Wales?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

S4C is publicly funded, and I do not think it is possible to exempt any publicly funded body from the necessity of seeking greater efficiency savings and making a contribution to the overall objective of mending our economy. I shall certainly want to discuss the issue further with S4C—as I said earlier, I had an opportunity to talk to representatives briefly last night—but I am also discussing it with my colleagues in the Welsh Office.

Photo of Stephen Phillips Stephen Phillips Conservative, Sleaford and North Hykeham

During the last Parliament, the Public Accounts Committee examined severance payments for BBC executives. We reported that our examination

“exposed a dysfunctional relationship between the BBC Executive and the BBC Trust that casts doubt on… the BBC's governance model.”

My right hon. Friend clearly believes that the model of the trust is broken. Will he go further, and do what it is obvious to me, to my hon. Friend Damian Collins and to Chris Bryant that he should do? Will he rule out reforming the trust, and indicate that either some independent body or Ofcom must have oversight of the BBC?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

I think it was the experience of witnessing some of the exchanges that took place between members of the Public Accounts Committee and representatives of the BBC and the trust that convinced us that the present arrangement was not working. As for ruling things out or in, I think it would be wrong for me to rule anything out before we have even begun the consultation. I must say, however, that I have considerable sympathy with what my hon. and learned Friend has said.

Photo of Ian Paisley Jnr Ian Paisley Jnr Shadow DUP Spokesperson (Energy and Climate Change), Shadow DUP Spokesperson (Communities and Local Government), Shadow DUP Spokesperson (Culture, Media and Sport)

I welcome the Secretary of State’s very clear statement of intent. Will he assure us that he will do three things during the charter review? First, will he talk to DUP Members, who represent the single largest section of the community in Northern Ireland? I think there is good evidence to suggest that the BBC in Northern Ireland has been totally biased against our community, and I feel that a good conversation with the Secretary of State about these matters would be helpful. Secondly, will he ensure that the World Service is included in the review? As he knows, we pay 73p a year in fees for that wonderful service, and I hope that it will be protected for the future.

Thirdly, will the Secretary of State look into the issue of Twitter? I understand that up to 200 people work for Twitter at the BBC. That means a wage bill of five or six million quid, at a very generous estimate.

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

Of course I shall be happy to talk to the hon. Gentleman and his colleagues. I hope that he and his party will become actively involved in the charter review process, and I look forward to discussing that with them in due course. I entirely share his admiration for the World Service. I mentioned that the United Kingdom was recently rated No. 1 in the list of the most effective proponents of soft power, and the World Service is an essential part of that. Having being involved in discussions about, for instance, what was happening in Ukraine in my previous capacity as chairman of the all-party group, I know how important the service is, and I want it to continue.

I am sorry; I have forgotten the hon. Gentleman’s final point.

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

Oh—Twitter. I am not sure that it is for me to say how many people the BBC should employ tweeting, but if the figure that the hon. Gentleman gave is correct, it does seem an awful lot. Perhaps the BBC would like to examine that when it is seeking additional efficiency savings.

Photo of Peter Bone Peter Bone Conservative, Wellingborough

I thank the Secretary of State for making his important announcements to the House first, thus allaying fears that they had been leaked to the press.

During his exchanges with Chris Bryant, did the Secretary of State say that we had stuck with the licence fee because it was not currently possible to change to a subscription service for technical reasons? If so, what are those technical reasons?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

What I said was that there might be attractions in moving, in due course, towards at least an element of subscription—and that is something that we will consider during the review—but it would not be possible to introduce a subscription system at the moment, because such a system requires the ability to switch off people who do not pay the subscription, and most households do not have the technology that would enable that to happen.

Photo of Ian Lucas Ian Lucas Shadow Minister (Defence)

The Secretary of State is right in saying that BBC local radio is a highly valued service. Unfortunately, it does not exist in Wales. Does he think that the contestable public fund to which he referred in his statement would be available to provide such a service?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

We have not decided whether there should be a contestable fund, but if there were, its purpose would be the promotion of public service programming by other potential providers. I think that, in theory, if someone wanted to make an approach to establish a local Welsh radio station, it would be a possible candidate, but nothing has been decided at this stage.

Photo of Matthew Offord Matthew Offord Conservative, Hendon

Reading Hansard this week, I realised that I was not the only Member of the House to have witnessed not only political correctness at the BBC but nepotism and, for some if not others, inflated salaries. Given that the charter renewal will provide an opportunity to look at the funding of the BBC, does the Secretary of State expect it to act in a more commercial manner in the future?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

The BBC gains considerable income from its commercial activities, which are carried out by BBC Worldwide. How that is done is something we will want to look at. However, one of the principal reasons that £3.7 billion of public money goes towards supporting the BBC is to support programming that is in the national interest and that has great public importance, but which would not necessarily be produced commercially.

Photo of Gavin Robinson Gavin Robinson Shadow Spokesperson (Justice), Shadow DUP Spokesperson (Home Affairs), Shadow DUP Spokesperson (Human Rights)

Mr Speaker, last night you missed the focus in the Chamber on my experience, or inexperience, of how the House operates. In preparing to come to the House, however, I watched a very good BBC production, the original version of “House of Cards”. I am not going to put about any stick this afternoon, but I watched “House of Cards” through Netflix, which costs £6.99 a month. When I watch BBC iPlayer, I do it through Now TV, which costs £5.99 a month. Even when I add those two together, it is still better value for me than the licence fee, from which I do not get any great benefit. Will the Secretary of State tell the House what discussions have taken place with organisations such as Netflix, Now TV, blinkbox, Flixster and other successful organisations—[Interruption.] Now TV is Sky—that are succeeding in providing a good service and a version of media that more people wish to access?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

The hon. Gentleman rightly identifies those services, which have recently entered the market and are proving extremely successful. Some might be cheaper than the licence fee and some might be more expensive, but the one thing they have in common is that people can choose whether they want to subscribe to them, which of course they cannot do with the licence fee. I remain an admirer of the original version of “House of Cards”, which he rightly says was produced by the BBC, and of the very clever adaptation for the American market, which was done by Netflix. Both versions are examples of superb drama, and I say that not just because the author is my daughter’s godfather.

Photo of Martin Vickers Martin Vickers Conservative, Cleethorpes

Somewhat inevitably, we as politicians judge the BBC in a slightly different way from the majority of our constituents, who just want an organisation that provides them with their favourite programmes, such as “EastEnders” and “Match of the Day”, and stations such as BBC Radio 2. May I urge my right hon. Friend to take a cautious approach to some of the suggestions that have been put forward in the past week or two? We should not assume that our constituents will thank us if they end up having to pay more to watch their favourite programmes. Can he assure me and my constituents that their interests, in terms of what it costs them to watch their favourite programmes, will be given serious consideration?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

I hear what my hon. Friend says, and I have a lot of sympathy with him. The existing cost of the BBC licence fee is substantial for many families on low incomes. What we have said is that, subject to the conditions that I set out in my statement, we anticipate that the licence fee will rise in line with inflation from the beginning of the next charter period, but that will still represent a real-terms freeze. The BBC is quite at liberty to make the case, during the charter review, for more funding in order to provide more, but I would need a lot of convincing before going down the road of increasing the cost to families, for the reason that my hon. Friend has described.

Photo of Barry Sheerman Barry Sheerman Labour/Co-operative, Huddersfield

Does the Secretary of State agree that this is an important time of change in broadcasting generally? The BBC is a national institution that dominates our country in many ways, but we also have a very intimate relationship with it. We have all grown up with it, and we know it intimately. We all have our foibles, and one of mine is that I cannot stand some of our broadcasters and would like to see them changed. I am thinking particularly of the family that seems to dominate “Question Time”. There are two great challenges for the BBC at the moment. It is British, and there is a bunch of people locally, in Britain, who would love to get in there and dismember it. We all know who they are—a mixture of Russian oligarchs, pornographers and goodness knows who else—but the real challenge is not the small people but the Googles and the global media people. They represent the real challenge, and we must protect the BBC, because it is British, and help it to stand up against that kind of globalisation.

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

I hope that the hon. Gentleman is not waiting for his invitation to go on “Any Questions”. I completely agree with him about the importance of the BBC. It is an immensely important institution, and our purpose during the charter review is to look at ways of strengthening and modernising it, precisely because of the technological developments and new services that have come about in the last 10 years. It needs to be modernised, but I certainly do not wish to destroy it or undermine it.

Photo of Edward Argar Edward Argar Conservative, Charnwood

Like Mr Dodds, I am grateful to the Secretary of State for his reassurance that decriminalising non-payment of the licence fee will be considered in the context of charter renewal, although I am disappointed that it will not happen sooner. Will my right hon. Friend reassure me that he remains genuinely open-minded—notwithstanding the issues identified in the Perry report—towards the decriminalisation of non-payment of the licence fee?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

I understand that there are strong feelings right across the House on the issue of decriminalisation. Indeed, the report produced by the Committee that I chaired during the last Parliament made it plain that the Committee also agreed with decriminalisation. Having said that, the Perry report raises some very real challenges that would need to be overcome if we were to go down that road, and we will have to take those into account during the charter renewal debate.

Photo of Diana R. Johnson Diana R. Johnson Shadow Minister (Home Affairs)

Many of my constituents value highly the local radio station, BBC Radio Humberside—no more so than in 2007 when large parts of Hull were flooded. The station provided essential information to people at that time. I am concerned at the Secretary of State’s saying that local people would be able to put forward their views at public meetings, because such meetings are not often held in areas such as Hull; they tend to be held in places such as Leeds. Will there be any other opportunities for local people to feed in their real concerns about the possible changes?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

The hon. Lady is absolutely right to point up the extremely important role that local radio plays, particularly at times of local disasters. She has given the example of what happened in Hull. I know that BBC local radio also played a part in a process that had a rather happier outcome—namely, the nomination of Hull as the city of culture. On the question of public meetings, the way in which they are organised will be a matter for the BBC Trust. The hon. Lady will see when she reads the Green Paper in detail that we have tried to give people every opportunity to contribute, including through writing in to the Department and making their views known online.

Photo of Tom Pursglove Tom Pursglove Conservative, Corby

In the past, I have asked the Secretary of State about the possibilities surrounding the BBC diversifying its streams of revenue. For example, it benefits from a huge archive. What consideration will be given, during the charter review process, to opening up that archive online and perhaps enabling people to download material for a small charge?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

My hon. Friend makes an important point. One of the BBC’s great assets is its extraordinary history of great programming, which still has value. I know that the BBC is looking into how it might make that available through the BBC archive online, and that is certainly something that has the potential to provide it with an additional source of revenue.

Photo of Sammy Wilson Sammy Wilson Shadow DUP Spokesperson (Treasury), Shadow DUP Spokesperson (Work and Pensions), Shadow DUP Spokesperson (Education)

So long as the BBC is guaranteed a source of income, whether through the licence fee or the proposed household levy, there will be no incentive for it to address its well-documented, massively wasteful expenditure or the issue of bias—whether it is left-wing bias, pro-EU bias or man-made climate change bias—which so annoys millions of people across the United Kingdom. Does the Secretary of State not agree that the only way of giving the BBC an incentive to address those issues is to give people the choice of whether they wish to pay for it or not?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

The hon. Gentleman makes the case for moving towards a subscription model, which, as I have said, in the longer term is an option that should be considered. He will have the opportunity to make that case again in the course of charter renewal. He raised a separate issue about BBC bias. At the moment, complaints about bias are examined by the BBC Trust. Whether that is the right place and whether it should be done externally by an independent are questions that we will want to consider as part of charter renewal.

Photo of Kevin Foster Kevin Foster Conservative, Torbay

I agree with the Secretary of State that the BBC across the UK is cherished and admired, not least BBC Radio Devon. Productions that show life across the UK are a vital part of the BBC’s public purpose, but does he agree that that must be linked with such content being created across the UK in order for local communities to feel properly represented by and valued by their BBC?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

My hon. Friend is right, in that the BBC’s content should reflect all the different parts of the UK but as part of the indie quota one of the things we achieved was that commissions have been placed right across the UK. During the short time I was able to spend at a reception last night for broadcasters and producers in Wales I met several small independent production companies from Wales which have been very successful in providing programming, not just for S4C, but for the BBC and indeed other broadcasters.

Photo of Jeremy Lefroy Jeremy Lefroy Conservative, Stafford

Like Ian Paisley, the Secretary of State and hundreds of millions of people around the world, I greatly value the World Service, which is almost always a voice of truth and sanity. But to compete with the other international stations, both on radio and television, the World Service and World Service Television will need greater investment in the coming years. Where does my right hon. Friend think that will come from?

Photo of John Whittingdale John Whittingdale The Secretary of State for Culture, Media and Sport

My hon. Friend makes an extremely important point. As I indicated, the role of the World Service is vital, particularly given Russia’s huge investment in its propaganda outlets and China’s investment in its broadcasting. The need for an impartial and respected voice of truth, which is what the World Service represents, is greater today than perhaps it has been for a long time. As he knows, the funding of the World Service was transferred to the BBC but it is nevertheless protected. Again, we will need to look at that during the charter review.