Digital Britain: BBC responds to report

BBC Trust’s Chairman Sir Michael Lyons responded earlier to today’s Digital Britain report. As BizAsia.co.uk has reported, the licence fee, which up until now has only been used to fund the BBC will now be shared for other projects including broadband and ITV regional news. The statement below is taken from BBC Trust:

“The BBC Trust has welcomed the Digital Britain review and participated constructively in it. We recognise that there are problems to be addressed and opportunities to be grasped, and we will continue to push for the public�۪s concerns to be put centre stage in this final consultative phase.

As guardians of the licence fee, our role is to make sure it is used in the interests of audiences to deliver the public purposes set out in the BBC Charter. Special funding brings special responsibilities. We recognise that there is work to do in reshaping the BBC and ensuring that it is never bigger than it needs to be. But we must also ensure that it remains strong enough to sit alongside the other big players in the broadcasting and media landscape: investing in high-quality journalism and other public service content, and supporting the creative economy.

We have to do this while helping others. That�۪s why, following a challenge from the Trust, the BBC has come up with an ambitious programme of partnerships to help the wider industry support public service content during tough economic times. The BBC will continue discussions with Channel 4 about a possible joint venture with BBC Worldwide that would create value for both parties.

The Digital Britain report now raises the question of transferring licence fee money from the BBC to other interests, including regional news organisations.

On behalf of licence fee payers, the BBC Trust opposes top-slicing. The licence fee has a clear aim, clear benefits, is clearly understood and has stood the test of time. Top-slicing would damage BBC output, reduce accountability and compromise independence. The licence fee must not become a slush fund to be dipped into at will, leading to spiralling demands on licence fee payers to help fund the political or commercial concerns of the day. This would lead to the licence fee being seen as another form of general taxation. The Trust will not sit quietly by and watch this happen.

One specific proposal in the Digital Britain report is to use any underspend on the Digital Switchover Help Scheme (DSHS) to fund its proposals. This is a distinct sum of money that has never been intended for core BBC content and services, and we make no claim for any DSHS surplus to be applied to core BBC services for the future. Research by Ofcom shows that licence fee payers would prefer to have switchover money after 2012 returned in the form of a lower licence fee than have it used for other purposes. If this principle were applied to the underspend, licence fee payers could benefit to the tune of some �250 million, or more than �9 per household by 2012-13. The Government will need to make a good case for any other use of this money.

In particular, the Trust is not convinced of the proposal in the Digital Britain report to apply any of the surplus to fund a second regional news operation. There has not yet been a full and open debate about the suggested costs of these services, and it appears that the current proposals have failed to take into account potential sources of commercial funding as well as alternative sources of public funding.

The Trust�۪s priority now is to ensure that there is a full and considered public discussion of these proposals because they have profound implications for licence fee payers, for the BBC and for the wider industry. Licence fee payers’ voices must be at the centre of that discussion, not least because our work confirms that the public have great affection for the BBC and would not support political or commercial interference which weakens it.”