Public Service Broadcasting (Communications Committee Report)

My Lords, I too thank the noble Lord, Lord Fowler, for securing this diverse debate on this informative and important report by the Communications Committee on public service broadcasting. Having heard so many praises from all his committee members, I wish that I, too, had had the chance to be on the committee under his enlightened leadership. The committee has made a number of recommendations aimed at modernising the public service broadcasting industry so that, in these difficult and challenging economic times, it may survive this short-term crisis and secure a long-term future. The perceived crisis within some areas of PSB could be seen as a little exaggerated, apart from in advertising. The report’s evidence illustrates that none of the channels is particularly suffering, perhaps with the slight exception of ITV, which experienced revenue losses of 3 per cent in 2008 and is predicted to have to make cuts to the tune of £245 million by 2011. However, even it remains confident that it will survive and be, ""in a fitter state when the economy eventually turns"." Channel Five’s owner, RTL, stated in its annual report that in 2006-07 revenue was up by 7 per cent, pre-tax, and that it was pretty self-sufficient. It, too, thought that it would weather the changes in the industry, despite the difficult economic conditions. The Enders Analysis report in 2008 stated that in many ways Channel 4 is financially in the strongest position among advertiser-funded public service broadcasters. The channel holds substantial reserves and has no pension deficits or indebtedness. Finally, the report describes the BBC’s financial position as being securer than that of virtually any other business in the country. The corporation’s total income in 2008 was £4.4 billion. It would be wrong of me not to mention at this stage that the UK is held in the highest respect worldwide for our PSB, especially the BBC, which, as my noble friend Lord Fowler stressed, is a national asset. I totally agree with him. Why then is so much attention now being given to the possibility of various mergers and contestable funding as ways of saving PSB when, from this report, there is little evidence that PSB is experiencing any real financial problems? It has been suggested that the reason why Channel 4 does not believe that it will continue without additional public support, ""has more to do with the company’s laudable aspirations to extend its business into many new areas ... than any real dangers to its core business"." As many of your Lordships have asked, could this just be a guise for channels to seek more taxpayers’ money to fund their own commercial projects? What protections have we against channels with these motives? Should we not insist that any corporation receiving or seeking taxpayers’ money be subjected to proper scrutiny and independent review? Could other areas within the industry be evaluated and trimmed down to provide cost savings? For example, it can be argued that the royal charter, the BBC Trust and Ofcom are all charged with approximately the same responsibility of upholding the independence and high standards of PSB and of acting in the best interests of licence fee payers. Could that be considered an overlap or overregulation and a waste of resources which, in this climate, might be better used elsewhere? Their aims are enshrined in the spirit of ensuring independence. After glancing at their composition, I think that their ability to perform this role could be questioned. According to the website, the chairman of the BBC Trust is a former Labour Party councillor, and the chief executive officer of Ofcom is a former policy adviser to Tony Blair who worked at another company as an adviser to Gordon Brown. Furthermore, as we all know, the appointment to the board of Ofcom is made by the Secretaries of State for the Department of Trade and Industry and the Department for Culture, Media and Sport. Does the noble Lord honestly believe that, as a result, these bodies are genuinely at arm’s length from the Government, as stressed so clearly by my noble friend Lord Inglewood? Despite the tone of the report being centred on the lack of funds, curiously it finishes by discussing what could be done with the underspend of the digital switchover programme after completion. Can the Minister explain to the House why this money could not be used to keep vital regional news programmes on air, together with, for example, fine programmes such as "The South Bank Show", especially in the light of the Government’s refusal to waiver this year’s 2 per cent licence fee rise, as requested earlier this year by the Conservative Party? Does this not illustrate the Government’s lack of judgment in relation to the public finances and does it not do little to maintain the bond of trust between the PSB, the Government and the people? I greatly look forward to the Minister’s response.