Digital Economy Bill - Committee (4th Day)

Part of the debate – in the House of Lords at 5:15 pm on 8th February 2017.

Alert me about debates like this

Photo of Lord Wood of Anfield Lord Wood of Anfield Labour 5:15 pm, 8th February 2017

My Lords, I wish to speak to Amendments 222B, 222C and 222D, which go together and which draw on the spirit of the excellent arguments from the noble Lord, Lord Best, and share many of the features of what the noble Lord, Lord Lester, set out. The idea is to reinforce the credibility of the licence fee, to ensure the BBC receives the resources it needs to fulfil its responsibilities under the charter. These amendments go together because, logically, the problem is that the process of negotiating the charter and setting a licence fee level do not always sit easily together.

At present, the connection between the charter process and the licence fee process is, at best, an indirect one. Each has its own political dynamics, so in setting the licence fee Governments have a range of considerations and pressures to contend with. One of those is the interests of the BBC to fund what the charter says it has to do, but it also includes the interests of other broadcasters, the politics around the headline licence fee rate—which is a huge thing for Ministers, proving to the public that they have got more for less out of the BBC and the overall settlement—and, as we discussed earlier, financial pressure to offload government responsibility on to the BBC without extra cost. So the temptation always exists for government to inflate the ambition of the charter and to put a lid on the increases in the licence fee simultaneously. That not only threatens the BBC’s autonomy but risks casting the Government with the suspicion of unwarranted interference.

Our proposals—without going into too much detail—suggest a three-stage process. First, an independent BBC licence fee commission would make recommendations to the Secretary of State on the appropriate levels of the licence fee. Secondly, the Secretary of State would have a duty to consult on the commission’s recommendation and to lay a report before Parliament outlining its results, with a recommendation on what the levels should be. Thirdly, in the event the Secretary of State does not follow the independent BBC licence fee commission’s recommendation, it would have to publish reasons to explain why it has not.

This process would remove the licence fee process from the suspicion of undue political interference, ensure the licence fee is set with regard to what the charter demands, and introduce new transparency through the independent commission. It would be a significant change, but it would serve the interests of licence fee payers, the Government and the BBC at once. Like others, I am optimistic that the Government will share the principles that motivate this group of amendments: increasing transparency, operational independence, and credibility of the settlement. I therefore look forward to the Minister sharing the optimism that other noble Lords have expressed in his reply.