The Secretary of State for Culture, Olympics, Media and Sport (Mr Jeremy Hunt)
On 14 October 2010, as part of the cross-Government drive to reduce the number and cost of public bodies and to improve their accountability, the Government announced their proposal to reform the funding mechanism for S4C by removing the link with the retail price index (RPI), as set out in section 61 of the Broadcasting Act 1990. The reform is necessary because guaranteed, inflation-proof funding from the Government is untenable in the current fiscal climate, but this does not detract from the Government’s firm commitment to secure the future of Welsh language broadcasting.
It is now the Government’s intention to table an amendment after Second Reading of the Public Bodies Bill which will add the relevant provision for removing the RPI/funding link to the face of the Bill, instead of in schedule 4, as at present. The decision to reduce payments to S4C was taken as part of the comprehensive spending review in line with efforts to reduce the fiscal deficit as early as possible. It predated the requirement to consult on orders which was added to the Public Bodies Bill at Committee Stage in the House of Lords. However, the implication is that the Government would not be able to consult meaningfully in relation to the changes to funding arrangements as would have been required by clause 10 of the Bill.
This amendment does not impact on the Government’s commitment to consult publicly on changes to the governance arrangements to S4C. It is simply a change to the proposed legislative mechanism by which funding changes will be made. Indeed, it gives Parliament the opportunity to debate the change as part of the passage of primary legislation. This amendment will also give greater clarity and assurance on the Government’s commitment to S4C in the long term. The new clause will for the first time set in statute a requirement that S4C receives sufficient funding for it to be able to fulfil its statutory, and vitally important, role as an independent Welsh language broadcaster.
As S4C remains listed in schedule 3 of the Bill, which provides for the power to modify constitutional arrangements, there is still the requirement under clause 10 of the Bill to consult on the order that will change the broadcaster’s governance arrangements. The Government will make an announcement about this consultation in due course. In the interim, discussions with S4C and the BBC Trust on the details of the partnership model are ongoing, and progress is encouraging following the appointment of the new chair of S4C.
I should like to reiterate that there is no change to the Government’s unerring commitment to a strong future for Welsh language programming and to S4C as an independent service. The Government are committed to ensuring that S4C will be funded at a level sufficient to ensure that it can fulfil its statutory remit and we intend to put this expectation on the statute book so that it is a legal requirement. Furthermore, the Government have also committed to a review of S4C’s strategy and finances before the end of the comprehensive spending review period, in order to inform future funding levels for S4C and to ensure that the new partnership with the BBC represents the best model for the long-term stability and growth of S4C.