John Pugh
Main Page: John Pugh (Liberal Democrat - Southport)
Maria Eagle
I am grateful to the hon. Gentleman both for promoting me to the Privy Council and for suggesting that I might be a member of the Tory party, which was probably going a bit too far.
It is, of course, true that some safeguards are implied in the proposals, and that is to be welcomed, but how the proposals look is also important to those outside. I think that simply reiterating that the director-general is the editor-in-chief does not really allay the fears created by the Secretary of State’s plans. I also think that his recent record in respect of public appointments does not reassure those of us who are worried. When the independent panel that was established to appoint a trustee to the National Portrait Gallery failed to shortlist his five favoured candidates—three of whom were Tory donors and one of whom was an ex-Minister—he simply scrapped the appointments process, and attempted to impugn the integrity of the chair of the panel. This prompted a furious slap-down from the now-retired Commissioner for Public Appointments, who accused him of exercising political interference in a supposedly objective public appointments process. We only know about this debacle because Sir David Normington’s letter was leaked.
Members on both sides of the House have expressed concern about the implications of the White Paper for the BBC and its editorial independence. The right hon. Member for Ashford (Damian Green) might have had his concerns allayed, but he has described editorial independence as a red line. The Culture, Media and Sport Committee Chairman said as recently as yesterday that the plans had prompted “a lot of concern”, and the Voice of the Listener and Viewer has said that
“there remain a number of concerns relating to independence”.
It is still not too late for the Secretary of State to make it clear that the appointments to the new unitary board will be made through a demonstrably independent means and that he will not seek to influence the outcome of the process. Indeed, it would benefit him if he were to do that. Why does he not undertake today to agree that the Commissioner for Public Appointments should run the process of appointing the board members, and restrict his own power to appointing those people who have been selected through such an independent process? He really needs to provide proper reassurance, and he can do so. Such an undertaking would be heartily welcomed across the House.
Ofcom will have a new role setting service licences and quotas for the BBC. It is important that this regulatory regime should not be used to interfere with the editorial and creative freedom of the BBC to use licence fee payers’ money to produce the programming it decides to produce. There must be no efforts from the Government to pursue the wilder proposals on scheduling and so-called distinctiveness that did not, in the end, find their way into the White Paper. We will seek assurances that Ofcom’s role in this respect will not impact unduly on the BBC’s editorial independence or be a weapon to be used by the Government or the BBC’s commercial rivals to interfere with the BBC’s creative freedom.
The BBC must be seen to retain its financial independence as well as its editorial independence. In that respect, the explicit statement on page 97 of the White Paper that
“the licence fee is not solely for the use of the BBC”
is deplorable, and could impinge on the BBC’s financial independence. I am glad that there is to be no more top-slicing of the licence fee. That would have constituted a breach of last year’s funding agreement—of which the House knows I have been critical in any event—between the BBC and the Government. The White Paper proposes the creation of a contestable pot of licence fee payers’ money, worth £20 million a year over three years. This sets an unwelcome precedent. Governments of all stripes have been too keen in recent years to see the licence fee as money for the Treasury to allocate to its own priorities. I believe that licence fee payers’ money should properly be seen as belonging to the BBC to enable it to fulfil its remit. It should be for the BBC to decide how it wishes to do that, not for the Secretary of State or the Chancellor of the Exchequer.
The Secretary of State has said his Department will consult on this proposal. If the consultation responses are against establishing the contestable pot, will he undertake to drop the idea? Will he tell us today when his consultation will start and when he intends it to finish? Can he confirm that the same levels of transparency and accountability that apply to BBC funding will be applied to this contestable pot if his pilot goes ahead? Has he considered the fact that this could be categorised as state aid if it is given to other broadcasters to use, as he no doubt intends?
We agree that the BBC should be as transparent and accountable as possible in relation to the licence fee payers’ money that it spends, so we support the idea of the National Audit Office being allowed to investigate the publicly funded areas of the BBC. However, allowing the NAO to audit the BBC’s commercial operations, which are not in receipt of any licence fee payers’ money, could place those operations at a significant market disadvantage. What argument is there for doing that? The commercial operations of museums, for example, are not open to the NAO scrutiny, and I know of no organisation in the private sector that receives public money that is subject to NAO scrutiny.
Failure to get this right could have the effect of reducing returns for BBC Worldwide, thereby limiting the extent to which the BBC is able to subsidise the licence fee through its commercial operations. The money that it makes from BBC Worldwide operations currently amounts to more than 12.5% of the BBC’s entire content budget, which would save licence fee payers the equivalent of more than £10 each if the licence fee had to be increased to cover a shortfall of that amount.
John Pugh (Southport) (LD)
The hon. Lady is a former member of the Public Accounts Committee, as indeed am I. She will be aware that the Committee has a long-standing issue with the BBC in relation to parliamentary accountability. Is she in favour of an increase in that accountability?
Maria Eagle
That is going back a bit, but I am indeed a former member of the Public Accounts Committee, and that is one of the reasons that I have very high regard for the abilities of the National Audit Office. I have no problem with the NAO being the auditor of the BBC, but there is an issue with its being the auditor of the BBC’s purely commercial operations. Is it really appropriate for the NAO to pursue entirely private money that has nothing to do with public funding? If this goes ahead, it will set an interesting precedent. I want to hear from the Secretary of State why he thinks this might be appropriate. I want to hear his arguments for doing it, because I think that there could be difficulties.
I am also concerned about the imposition of a mid-term health check on the new charter. It seems suspiciously like the break clause—which the newspapers were briefed that the Secretary of State wanted—by another name. We welcome the fact that the charter is to last for 11 years, and it should not be compromised or have the agreement that underpins it reopened by the back door during that period. I am concerned that the so-called health check—the break clause by another name—will be destabilising for the BBC and create uncertainty, which will not be helpful. Page 58 of the White Paper states:
“It will be for the government of the day to determine the precise scope”—
of the health check—
“consulting the BBC’s unitary board and Ofcom”.
So, the Government could decide, were they so minded, to reopen such questions as whether the licence fee belongs to the BBC or should be given to other broadcasters, the extent of the contestable pot, whether the licence fee is indeed the right form of funding, and any number of other things that would in effect reopen the charter settlement.
The Secretary of State told the Culture, Media and Sport Committee yesterday that this was not his intention. He now has an opportunity to guarantee, in the charter and the agreement he makes with the BBC, that any such process will have the narrowest possible focus and cannot be used to reopen the fundamental tenets that underpin the charter halfway through its term. We need reassurance, in other words, that it will not be a five-year charter in all but name.
I know that Members raised this issue when the White Paper was published. The hon. Member for Bexhill and Battle (Huw Merriman) pressed Ministers for more detail on this point immediately after its publication. In the other place, the Conservative Lord Fowler has questioned the plan to have such a review, arguing that these functions should be left to a
“strong board of independent directors”.—[Official Report, House of Lords, 12 May 2016; Vol. 771, c. 1825.]
He stated that those directors should be allowed to run the BBC “without interference”, and I find myself agreeing with him. Can the Secretary of State confirm today that the health check—if he decides to persevere with it—will be able to recommend proposals to be included only in the subsequent charter, rather than being used to compromise the BBC’s independence midway through the charter term we are about to embark on? Will he reassure the House, especially Opposition Members, that it will be set in the narrowest possible terms?
The BBC’s core Reithian mission to “inform, educate and entertain” has worked well for over 90 years. It is the foundation on which the corporation’s success has been built. There has always been a virtue in the clarity provided by the simplicity of the current mission statement that has stood the BBC in good stead, so why is the Secretary of State determined to alter the substance of the mission statement to include
“an explicit requirement to be distinctive, high quality and impartial”?
What exactly do the Government mean by “distinctiveness”? It is one of those words that can mean all things to all people. It certainly means something different to him than it means to the BBC or members of the public. Page 32 of the White Paper defines distinctiveness as:
“A requirement that the BBC should be substantially different to other providers across each and every service”.
That hardly pins it down. Ministers must allay the concerns that this could be interpreted as the BBC being forced to withdraw from anything its commercial rivals wish it was not doing, for their own commercial gain.
The Secretary of State has questioned the distinctiveness of some of the BBC’s most popular programmes, such as “Strictly Come Dancing”. The White Paper states on page 71:
“The government is clear that it cannot and indeed should not determine either the content or scheduling of programmes.”
However, it also sets out prescriptive content requirements for radio and TV. To take one example for TV, it demands on page 38:
“Fewer high-output long-term titles.”
He seems to be telling the BBC to stop producing much-loved shows, such as “Countryfile”, “Casualty” and “Doctor Who”, that happen to have been produced for many years. What reassurances can he give that he will not simply require Ofcom to make the BBC back off doing things he does not like, on the basis of those extremely prescriptive requirements?
John Pugh (Southport) (LD)
I congratulate the hon. Member for Heywood and Middleton (Liz McInnes) on introducing a new angle to the debate.
My uncle Will, a clergyman of strong opinions for whom I had a good deal of respect, used to argue from the 1970s that the BBC was run by communists. A more common view, though, is that the BBC is a great British organisation or institution and, like most great British organisations, it is as much a product of historical accident as of design, a point made earlier by the hon. Member for Ealing North (Stephen Pound).
I hesitate to call the BBC a national treasure, but it is certainly internationally respected, largely because it is not simply consumer-driven or obviously pursuing its own agenda. It acts as though it has obligations and values—duties to inform, educate, foster cultural development and encourage democratic thought, new ideas and understanding of traditions and history. That is probably why we have the diversity of programmes and more creativity and risk on the BBC than we get from commercial broadcasting. Oddly enough, that is profitable for the BBC. If it did not have those obligations, there would be no case to provide it with public funds.
The BBC model is ultimately paternalistic—which is why, mixing metaphors, it got called “Auntie”. As we have already established, parents and aunties are seldom impartial, and we may wonder in a post-modern way whether we ever get impartiality right. However, we want a public sector broadcaster to make the effort, which means building the right sort of challenge into the system.
Mhairi Black (Paisley and Renfrewshire South) (SNP)
Does the hon. Gentleman accept that from a Scottish point of view, despite the limited devolved powers that the BBC has, which my hon. Friend the Member for Edinburgh East (Tommy Sheppard) touched on, everything is reported from a London-centric perspective? That is part of the problem and accounts for some of the dissatisfaction with the BBC.
John Pugh
We would make exactly the same point in the north-west, which is why we are so glad that the BBC was persuaded, sometimes kicking and screaming, to come up to Salford. A public sector broadcaster that degenerates into a clique of like-minded individuals who are inordinately pleased with themselves will not do the trick. We all recognise that the BBC has diversity issues and may also have complacency issues. Just because the BBC is criticised from both sides of the political divide, as it clearly is at present, does not mean that it is getting things right. In most other walks of life, universal condemnation is not an automatic sign that a good job is being done.
Much of the challenge should come from the public, as indeed it does. Much of the challenge will come from other media, as indeed it does. Some should come from Parliament. The Public Accounts Committee has wrestled for some time to get to the bottom of the BBC accounts and found great difficulty in doing so. The PAC has had difficulty getting to the bottom of only two issues—one is Saudi arms deals and the other is the BBC finances. If there is to be effective challenge, it must be hard-wired into the system. If it is not in the culture itself, as it should be, there must be a structure beyond feedback programmes that facilitates it.
I do not see a case against Government appointees being part of that structure. Why, after all, should the Government not have a view? The important thing is that the Government’s influence is not undue, decisive or determining, and must always be transparent. Sometimes pseudo-independent figures aligned with Government on boards and trusts—referred to earlier as leftie luvvies—are more worrying than overt Government representation. Behind-the-scenes influence can often be corrosive. There are current allegations that the BBC is running scared of covering the Tory election expenses issue because it is fearful of what the Government may do.
Sadly, I think this Government would prefer to have things both ways—covert and overt influence, stuffing the structure with Government placemen, using charter renewal as a disciplinary tool, and using traditional dark arts to hobble the BBC, where possible. It is our duty here to argue for as much transparency and accountability as we can get. That is the only genuine way in which we can safeguard independence, but transparency must be twofold. It must be about what the BBC does and funds, but also about what leverage the Government have and exercise.