Broadcasting

Sammy Wilson Excerpts

Tuesday 18th October 2016 Commons Chamber

[Mr Watson]

I am being slightly diverted from the motion. I have only been in this role for 10 days, so I may not have my facts entirely right, but I think that the £630 million that my hon. Friend the Member for Wrexham (Ian C. Lucas) described has also been underspent to the tune of £60 million. It would be very useful if the Government could give that money back to the BBC so that it could be put into diverse broadcasting such as children’s broadcasting, in which the right hon. Gentleman and I both have an interest.

[Sammy Wilson (East Antrim) (DUP)]

Does the hon. Gentleman accept that in an age when all other public bodies are being asked to make efficiency savings, it is reasonable for the BBC to be asked to share some of the burden, especially given the fact that the BBC overspends on a lot of programme making? For example, it took twice the number of people to the Olympics than other broadcasters took? Salaries are still going up, the top echelons have not been reduced and huge pension settlements are still being given to those who leave the BBC.

[Mr Watson]

I hope that I have not given the hon. Gentleman the impression that I do not think viewers need value for money—they certainly do. The transparency measures agreed by both sides of the House have helped to ensure that the value-for-money case is made internally within the BBC.

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[Mr Whittingdale]

That was obviously a separate debate. I understand the concern expressed by the hon. Lady, but I do not agree with her. Even under the original suggestion, the BBC would have had a majority when the non-executive and executive board members were taken together. Moreover, as I sought to point out, the non-executive members will have been through the public appointments process. They will have had to demonstrate their competence and qualifications for the role, which most people regard as a pretty good safeguard. Of course, the BBC Trust, which the board replaces, was wholly appointed by the Government, so this is quite a big shift.

[Sammy Wilson]

Apart from the political connotations of the appointment, does the right hon. Gentleman not find it even more bizarre that, because of either the perceived inexperience of the appointee or other internal factors, the BBC has had to create another management post to support Mr Purnell, with a salary of more than the Prime Minister’s, at a time when it says it has no money?

[Mr Whittingdale]

Again, the hon. Gentleman raises some valid points. There are a number of curiosities about this appointment. As I indicated earlier, I am sure the Select Committee will want to think about some of them when the director-general next appears before it.

I want to touch on a couple of other aspects of the agreement and charter, which, as I have said, I very much welcome. The introduction of distinctiveness as a key requirement for the BBC is important. It is right that an organisation that enjoys £4 billion of public money should not be competing with the independent sector, and that it should look different from the commercial sector in television and, just as importantly, in radio. I hope that putting that in and then having Ofcom adjudicate it will make a difference.

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[John Nicolson]

Except, of course, that the previous director-general, when faced with precisely this threat, threatened to resign. The Government blinked first on that occasion. The BBC has enormous power if it plays its cards well.

[Sammy Wilson]

Does the hon. Gentleman not accept that the BBC probably breathed a sigh of relief at getting off so lightly in that deal? It now has an increased licence fee and a five-year review, which probably means nothing, but it has had enough money this year to increase its wage bill by £21 million.

[John Nicolson]

The hon. Gentleman makes a fair point about BBC salaries, and I shall say more about that later. They are ludicrously inflated at senior levels. The director-general often says, “We pay these huge salaries because that is the going rate in the outside world.” The BBC does not actually know that, however, because nobody ever wants to put it to the test by leaving a senior post in the BBC. They know that they will never achieve such high salaries in the outside world. I asked the director-general if he had ever conducted a study on what his senior staff got when they left the BBC and went into the industry outside. He told me that he had never conducted such a study.

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[Maria Eagle]

The hon. Gentleman employs an extended metaphor. I do not quite understand how that would apply in respect of the mid-term review. I do not know why the mid-term review was not simply dropped. It seems to me that Ministers have been casting about to try to find some purpose for it because they did not want to accept that the mid-term review or the break clause had started out as something different from how it ended up. I am not sure what the role of the review is, so when the Minister winds up the debate, I hope that he will be able to give us a little more reassurance.

It was said in the other place that governance would form part of that mid-term review, so what kind of change to governance, if any, is it likely to make? To what extent might there be some change in the air? If the Government do not like how the arrangements that they set out in the charter are proceeding, will we see a wholesale change at mid-term to the governance of the BBC? What steps will the Government take to ensure that any such changes are as fully scrutinised as the arrangements for the new charter have been? There is not necessarily a parliamentary aspect of the mid-term review or health check.

We had an exchange about governance earlier. I welcome the fact there is to be a competition for the new chair of the BBC Board. I was critical that the chair of the BBC Trust had simply been appointed to what is a rather different role without any competition at all and at the behest, it seems, of the previous Prime Minister—though not, I suspect, at the behest of the former Secretary of State. I emphasise that I am not and was not commenting on the ability or otherwise of Rona Fairhead to do the job, but simply on the principle of the matter. In any event, she has decided not to put herself forward, so the BBC will have a new chair. Opposition Members are mindful of what the outgoing Commissioner for Public Appointments, Sir David Normington, said about the Government’s increasing propensity to appoint Tory supporters to important public roles, so we will be watching this particularly sensitive appointment with extremely close interest.

I welcome the fact that the Government have abandoned the previous Secretary of State’s attempt to enable the Government to appoint a majority of the unitary board, which I do not believe was a sensible proposal. The retreat that the Government have agreed to, following discussions with the BBC, is a good one, because they could have led themselves into criticisms that they would rather not have. I think that the development is entirely positive.

I want to say a little about the thorny topic of distinctiveness. What on earth does “distinctiveness” now mean in the context of the charter? We know what the right hon. Member for Maldon (Mr Whittingdale) thought it meant. Indeed, today he reiterated in part his view of what it means—we got the distinct impression that anything popular, commercial or with good ratings would not be distinctive enough. He thought that the BBC should be prevented from engaging in any kind of competition with its commercial rivals in this respect, but what does that mean in the context of the new charter?

I think that the definition in the White Paper is fiendish, because “substantially different” can mean whatever anybody wants it to mean. We are assured by Ministers that it will not be applied to individual programming. To be fair to the right hon. Gentleman, I never heard him say that he meant it to apply to individual programming, except in some lurid newspaper stories that seemed to be coming from his Department at the time. The Government have simply left it to Ofcom, which is not used to doing this kind of thing, to work this all out later. In my view, there is still a significant prospect of this being used mendaciously, either by politicians—perish the thought—or by the BBC’s commercial rivals, who might simply want to stop the BBC competing with them by making complaints about distinctiveness.

[Sammy Wilson]

The hon. Lady makes an important point about the meaning of “distinctiveness”, but does she not agree that there is also an important point about the BBC, with the vast amount of money it acquires from the licence fee payer, having an unfair advantage over other commercial operators? There has to be a way of ensuring that that advantage is not abused to prevent commercial operators competing for good programmes.

[Maria Eagle]

The BBC ought to be held to account for how it spends its money, whether or not it meets its objectives and its requirements under the charter. I think that that is absolutely fair. We should not get into arguments about whether particular programmes are sufficiently distinctive or different. The definition is a lawyer’s dream, and there are concerns about what it will end up meaning in practice.

We have heard tell of the £60 million contestable pot of licence fee payers’ money. The survival of that pot is a retrograde step, no matter what use it is to be put to. I note that there is supposed to be some kind of pilot and that commissioning children’s programmes is to be involved in whatever is done with the money from the underspend. The fact is that the Government are establishing the principle that licence fee payers’ money should be handed over to the BBC’s commercial rivals to make programmes. That is different from the BBC itself deciding that it might want to commission programming from independent producers, which it of course does a lot of as part of the way it does its business. The problem is that if the contestable pot simply takes money away from the BBC and gives it to its rivals to make their own programmes without any of the guarantees that the BBC would have for maintaining ethos and quality, it is no more than a raid on the BBC’s resources. That could be the thin end of what might end up being a very large wedge.

We saw newspaper reports before the White Paper was published about a contestable pot involving a lot more than £60 million. Although the pot is currently small and has been identified as a way of using underspends, the possibility that it will expand over time and that a principle will be established that licence fee payers’ money is not to be used by the BBC to fulfil its mission could be significant. I therefore would like some assurances from the Government that the contestable pot will not be vastly expanded during the period of this charter review. I do not think that it should be proceeded with at all.

I want to say a little about salary transparency. We have heard the argument that publishing the salaries of the so-called talent in the BBC is an issue of transparency. I understand that argument, but I want to put an alternative viewpoint. Far from being about transparency, this is actually a tabloid editor’s dream and a destructive bit of punishment for anybody who wants to work for the BBC rather than a commercial broadcaster. Why is it right to invade the privacy of those who work for the BBC but not those who work for any of its commercial rivals? The Minister in the other place said that this requirement—

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[Damian Collins]

It is a new post and it was literally made for him. It was not advertised widely for other people to apply for it. My right hon. Friend the Member for Maldon said in his speech—I said this in an intervention as well—that, regardless of people’s views of the capabilities of James Purnell, or concerns that people may have about his past political involvement, the key thing is the process that was run to appoint one of the most senior directors at the BBC. Why was there no competition within—or, indeed, outside—the BBC involving people who may have had the requisite skills to apply for the job? If we are going to be critical of the way in which Rona Fairhead was appointed as interim chair of the BBC—as I have said, that should have been a clear and transparent process—that should also apply to other senior executives, including those on the BBC board. That certainly applies in the case of James Purnell; I agree with my hon. Friend the Member for North West Leicestershire (Andrew Bridgen).

[Sammy Wilson]

Does the hon. Gentleman agree that the transparency applied to those on top salaries should also be applied to those who are on contracts that enable them to avoid tax either by paying only corporation tax on money that is paid directly to them, or by participating in tax avoidance schemes, which the BBC now uses for hundreds of its well-paid employees?

[Damian Collins]

I completely understand the point that the hon. Gentleman is making. People must certainly pay the taxes that are due on the income that they receive, wherever it comes from. That applies to BBC executives as much as to anyone else. I note what the Secretary of State said in her intervention a few moments ago, and I believe that this is something that we must keep under close review. If BBC Talent is trying to use a loophole by channelling more of its income through independent production companies to avoid having to declare it—our concern, through the work of the National Audit Office, is that there has been an acceleration in that process and that people are trying to get around the rule in the new charter that those who earn more than £150,000 should declare what they earn—we should look again at the matter in the mid-point review.

I want to touch on the comments about the Scottish Six made by my friend on the Culture, Media and Sport Committee, the hon. Member for East Dunbartonshire (John Nicolson). As I was the acting Chair of the Committee and a member of the Committee when we discussed the matter, I was able to give my view on the significance of the Scottish Six. We felt—I certainly felt this, and I hope the hon. Gentleman agrees—that we were calling for the BBC in Scotland to be given editorial independence over the six o’clock news, so that it could reflect the fact that devolution made certain news items less relevant to the Scottish audience than to the rest of the UK audience. We envisaged that the BBC in Scotland would have the editorial independence to make those decisions and the freedom to change the running order of the programme if it chose to do so. The Scottish Six would still be a national news programme, but it would be broadcast from Scotland, it would be produced and edited in Scotland and it would have a Scottish perspective on the national news. We considered the fact that the BBC was comfortable to make that decision with radio, so why should it not consider doing so for television?

That is, of course, an editorial decision for the BBC to make, but one of the things that the Committee hoped to do with this recommendation in the report was to give the BBC a shove and say, “You have been looking at this for quite a long time, you have tried various different formats and you have tried to make a decision. Here is our view, but it remains something for you to do.” I agree with the comments made a few weeks ago by the Secretary of State. I think I am right in interpreting her as saying that, as others have discussed, the Government should not dictate to the BBC what it should do about this; it is a decision for the BBC to make.

Finally, I want to touch on the BBC iPlayer, which has been mentioned. It is important that we remove the loophole whereby people can get out of paying the licence fee by watching programmes—both catch-up and live—on the BBC iPlayer. This also takes us into important new territory that the BBC should explore. By far the most practical way to police such an arrangement would be to give each licence fee payer a PIN that they could put into a portable device to access the iPlayer, to prove that they had paid the licence fee. That is common in other digital services that people use all the time, and it would be the simplest and most logical way to proceed. It would certainly be a lot easier than having digital enforcement cameras—a modern-day version of the TV detector van—going around, trying to work out whether people were viewing the BBC online.

One of the reactions of people in the BBC to such a suggestion is that they do not like the idea of licence fee payers becoming subscribers, or of the BBC becoming a subscription service. I do not think that that would be the case at all. That suggestion is simply an acknowledgement of the fact that new technology allows people to access BBC services in a different way. Those services are still free to access and use for people who pay the licence fee. We would simply be using new technology to make them more readily available.

I believe that a sensible step forward would be to have complementary subscription services that gave people deeper access to the back catalogue and enabled them to stream other programmes that might not be available for broadcast. That would allow the BBC to grow its revenues from its back catalogue and to be innovative in its programme making. It would in no way represent a shift away from the licence fee-funded BBC; it would simply be a recognition of the fact that new technology, platforms and tools will allow the BBC to innovate in ways that simply were not possible in the past. Over this charter renewal process, I would like to see the BBC taking further steps in that direction.