Future of the BBC

John Leech Excerpts

Monday 21st October 2013 Commons Chamber

[Mr John Leech (Manchester, Withington) (LD)]

It is a pleasure to see you in the Chair for the first time since you were elected, Madam Deputy Speaker.

I find myself saying, for the first time in my eight and a half years in Parliament, that it is a pleasure to follow the hon. Member for Rhondda (Chris Bryant). I agreed with almost everything he said, which is a fairly uncommon occurrence.

I am delighted to speak in this important debate about the future of the BBC. It is particularly timely, given that the Culture, Media and Sport Select Committee is soon to begin a major inquiry into its future. No doubt, this debate will help to set the scene for our inquiry and to show the wide range of views of politicians on both sides of the House on what the BBC should look like in the future. I make no apology for expressing my full support for the BBC and for being committed to supporting the long-term future of its top-quality public service broadcasting, but as my predecessor as Lib Dem spokesperson for Culture, Media and Sport, the now Comptroller of Her Majesty's Household, my right hon. Friend the Member for Bath (Mr Foster), so rightly said, because it is funded by everyone, it is in the unenviable position of having to please everyone, which is impossible.

Unfortunately, it has become increasingly fashionable to attack the BBC, particularly in the light of recent revelations about pay-offs to senior executives, allegations of bullying and question marks over the handling of the Jimmy Savile affair. The BBC cannot be immune to criticism and its detractors are right that it is not perfect and sometimes gets it wrong. For instance, spending £25 million on severance payments for 150 senior managers—an average payout of £164,000—simply cannot be justified, and people were rightly mystified to hear of a £500,000 payment to the former director-general, George Entwistle, given that he had apparently resigned and that this exceeded his terms and conditions.

Having said that, however, under the leadership of Tony Hall, the new director-general, there are clear signs that the BBC is rising to the challenge and addressing these shortcomings. For instance, the £150,000 or 12-month salary cap on redundancy payments is very welcome, as is the commitment to removing so-called gagging clauses from BBC contracts and compromise agreements. The BBC needs to draw a line under these damaging revelations and concentrate on what it does best: providing top-quality programming and completing its efficiency savings without damaging its position as the best public service broadcaster.

Nobody can doubt that the six-year freeze created a massive challenge for the BBC—a real-terms 20% budget cut over the period—while it had to take on responsibility for £340 million of spending, including the World Service, S4C, local television and the roll-out of superfast broadband, but at the same time, the BBC was guaranteed its funding over that six-year period, which provided much-needed certainty. As we move forward, it is vital that that certainty is retained and that the BBC is in a position to plan for its future well into the next decade.

The cuts have certainly not been easy: good-quality local programming has been lost in the regions, including in Manchester with Radio Manchester, while more than 2,000 jobs have been lost, on top of the thousands that went under the value-for-money, cost-cutting exercise. The number of senior management posts has been reduced by 30% since 2009, while the National Union of Journalists has raised serious concerns about the loss of investigative journalists and the potential impact on the quality of programming; and that is before recognition from management that further savings still need to be made.

By 2017, the BBC will look radically different from the one that began this process of cost cutting, but despite the significant cuts, the BBC has maintained its popularity: 96% of the UK population access BBC content in an average week; audiences spend on average almost 19 hours with the BBC each week across all its services; when asked which media provider they most trusted, 58% of people said the BBC, which was well ahead of its nearest rival, which was ITV on 14%; 78% of the public are glad that the BBC exists, up from 71% in 2008; and 76% of the public think the BBC maintains high standards of quality, up from 66% in 2008. The right hon. Member for Dulwich and West Norwood (Dame Tessa Jowell) beat me to it when she said that those are the sort of polling figures that politicians can only dream of.

Despite its challenges and the resistance from some, the move to Media City has also been a great success and was achieved under budget. It has been a massive bonus for the north-west economy and an engine for further economic regeneration for that part of Greater Manchester. Investment in Cardiff and Glasgow has brought about similar success in Wales and Scotland.

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

Although it is good that we can point to investment in Glasgow, Cardiff and Manchester, are other parts of the country not entitled to a similar return, and have Birmingham and the midlands not done badly out of the distribution of spend so far?

[Mr Leech]

I recognise that Birmingham has done badly out of the move to the regions, but the hon. Gentleman will forgive me, as a Manchester MP, for welcoming investment in Greater Manchester. Nevertheless, I accept his point.

If the BBC is to continue to succeed and maintain its position and reputation, the Government must commit to its long-term future. It is unrealistic for the BBC to expect a real-terms increase in its funding after 2017, but at the same time it is unrealistic for the Government to expect that further real-term cuts can be sustained without damaging the BBC and compromising the quality of programming.

[Steve Brine]

Although it might be unrealistic to expect those things, further to the point I made to the Chairman of the Select Committee, does the hon. Gentleman accept that it might be realistic for the BBC to stop doing some things, in certain creative spaces, and focus on doing what it is good at and what a “public broadcaster” should be doing?

[Mr Leech]

I disagree with the hon. Gentleman, because there is strong evidence to suggest that the BBC producing such content actually drives quality in the commercial market. There is little doubt in my mind that further funding cuts would be seriously damaging to the future quality of programming.

[Alun Cairns]

I find it strange that the hon. Gentleman thinks that further cuts would damage the BBC’s output. Have several examples not been aired already during this debate of significant waste? The digital media initiative cost £100 million, while the pay-offs to BBC executives also cost significant sums—£329 million to 7,500 members of staff. Those are examples of money that has not gone into broadcasting, which is the purpose of the BBC.

[Mr Leech]

Certainly, there are examples of money not going into broadcasting, but I think the new director-general has got a grip of what has gone on in the past, and I would expect it not to happen in the future. One good example is the restriction of pay-offs for senior executives to a year’s salary or £150,000, which is line with senior civil servants. My biggest concern is that future cuts to BBC funding would be most severely felt in local and regional broadcasting.

[Gareth Johnson (Dartford) (Con)]

Will the hon. Gentleman give way?

[Mr Leech]

If the hon. Gentleman will allow me to make a little progress, I will give way.

The cuts have already seriously stretched resources in local and regional broadcasting, and no doubt further cuts would have a severe impact, which is why we must ensure that there are no further cuts to the BBC after the six-year licence fee freeze comes to an end.

[Gareth Johnson]

I am grateful to the hon. Gentleman for his patience. Does that not effectively mean saying to doctors, nurses, police officers and firemen, “You can’t have any more salary”, but to the BBC, “Here you are BBC, here’s an increase”?

[Mr Leech]

That is not what I am saying. Had the hon. Gentleman let me continue for two more seconds, he would have heard me say that we should commit to inflation-linked rises in the licence fee after 2017, with a similar commitment to maintaining inflation-linked rises for at least the next five to six years. I realise that that would not be popular with some hon. Members, who believe that the licence fee should be scrapped altogether or reduced, but the current £145.50 fee works out at about 40p a day to watch the BBC, compared with around four times that amount for Sky. Furthermore, about a quarter of Sky viewing involves BBC programming that people have already paid for. The BBC is good value for money.

Good quality public service broadcasting sets the bar high and ensures good quality commercial broadcasting, because the commercial quality needs to be good to compete. Where public service broadcasting is poor, the commercial sector does not need to provide high-quality programming to gain market share. The BBC sets the bar high, and needs to continue to do so. Recent research shows that public service broadcasting raises audience expectations and forces the commercial sector to raise its game too. Enhanced quality in the commercial sector then challenges public service broadcasters to achieve ever-higher levels of quality and investment to sustain public service broadcasting’s distinctiveness. Some hon. Members have questioned whether the BBC needs to continue to create certain programmes when commercial broadcasters such as Sky are now producing good-quality content. I would argue strongly that Sky is now doing that precisely in order to compete with the BBC, rather than the other way round.

Owing to time constraints, I have concentrated my brief comments on the future funding of the BBC. I make no apology for doing so, because that funding is vital to its long-term future. If I had had more time, I would have liked to cover many more of the BBC’s opportunities and challenges. I shall briefly mention four of them. One opportunity relates to the success of BBC Worldwide and the need to encourage it to do even more. It generated more than £1 billion in revenue in 2011-12, and there is plenty of scope for improving on that figure. Secondly, I would have liked to talk about the BBC’s role in sport, and particularly its role in enhancing and showcasing women in sport. Thirdly, we need to end the anomaly whereby the BBC pays Sky to have its programmes on Sky’s platform. That is a ludicrous situation and it needs to come to an end. It should be the other way round, because Sky benefits from having BBC programmes on its platform. At the very least, the arrangement needs to be cost neutral; the BBC should not be paying.

Finally, there is a need to protect public service broadcasting through guaranteed positioning on the electronic programming guide. That is a bit of a geeky issue, but I hope that the Select Committee will look into it as part of our BBC inquiry. The electronic programming guide could become even more important as television changes in the coming decades, and we need to set it in stone that public service broadcasting will have the prominence that it deserves on the electronic programming guide.