BBC white paper: More cuts on way, licence fee income frozen at £3.7bn, Local TV subsidy scrapped

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  • Income from public money frozen at £3.7bn for five years
  • New powers for Ofcom to regulate BBC journalism
  • Funding scrapped for Jeremy Hunt’s Local TV network
  • £8m of BBC money to fund 150 new local press council reporters
  • All TV and radio commissioning to go out to open competition
  • Licence fee safe and non-payment still a criminal offence

The BBC white paper paves the way for more cuts at the corporation as licence fee income will be frozen at £3.7bn a year until 2022.

But many at the corporation will be relieved by a proposed settlement which trims the power and influence of the media giant far less than some had anticipated.

The new proposed BBC charter will run for 11 years, to 31 December 2027, with the aim of distancing future reviews from the Parliamentary election cycle.

The licence fee remains and is set to go up by inflation from £145.50 at the present to £160.50 by 2021/22. Non payment will remain a criminal offence and measures will be taken to close the “loophole” whereby those who access the BBC purely via iPlayer get it for free in the UK.

In future the corporation’s journalism will be regulated by Ofcom, a state-run regulator, rather than the BBC Trust (whose members were appointed by the government).

Ofcom will be given new powers to fine the BBC and force it take action if it deviates from its charter.

The Trust will be abolished and instead the BBC director general will report into a unitary board. Half of the members of the board will be appointed by the BBC itself and the other half by the government through a public appointments process.

It is proposed that the BBC’s core “public purpose” will be reformed to ensure that it does not undermine commercial news providers.

The white paper proposes that the public purpose ought to say the BBC “should offer a range and depth of analysis and content not widely available from other UK news providers, using the highest calibre presenters and journalists, and championing freedom of expression, so that all audiences can engage fully with major UK and global issues and participate in the democratic process as active and informed citizens”.

The white paper welcomes proposals already in train from the BBC to cut back on lighter “magazine-style” content online.

It states: “While the BBC will maintain a full range of subjects and stories, its focus will be on rigorous, impartial analysis of important news events and current affairs.”

Ofcom’s new powers over the BBC

Ofcom’s proposed new powers over the BBC will include:

  • assessing the performance of the BBC board in meeting its charter obligations
  • monitoring and reviewing performance with powers to remedy any identified failings
  • regulating editorial standards to ensure the BBC meets requirements in areas such as accuracy, impartiality, harm and offence
  • holding the BBC to account for its assessment of both market impact and public value, alongside regulation of commercial
  • acting as the appeal body in terms of complaints.

Ofcom will also have the power to undertake additional investigations of BBC activity and issue fines. It will also be able to order the BBC to stop proposed changes or reduce the scale of its services.

New deal with local press

It is proposed that a new fund will be set up, totaling £20m a year, to enable organisations outside the BBC to compete to provide public service content.

In terms of local newspapers, the BBC will spend £8m a year funding a network of 150 reporters to cover councils and public services. They will work in the commercial sector and make their content available to both their employers and the BBC.

Local newspapers will be able to bid for the reporters.

The review says: “The government expects the BBC to use its privileged position to support the provision of news and information and specifically we expect to see a positive partnership with the local news sector. “

There will also be a news bank to provide free syndication of audio and video content to local newspapers and a new BBC Data Journalism Hub, partnering with a university, that will “make data journalism available for news organisations across the UK”.

Pay for Chris Evans to be revealed (but for few other top stars)

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Currently 50 per cent of BBC TV and radio programmes must be made in-house. In future, the white paper proposes that all commissioned programmes will be put out to open competition (except for news and news-related current affairs).

The BBC has resisted calls for it to name all staff paid over £150,000. Instead it will identify all employees earning over £450,000 a year (around ten people).

Top Gear presenter Chris Evans (who is believed to be one of them) told the BBC this morning: “It isn’t exactly breaking news that people who do what I do for a living, compared to people in the real world, get paid too much money.

“We’ve got jobs that people would kill for, we get to do things that people would pay to do if they could afford it, and sometimes those things aren’t available to buy. Most of us work part-time anyway. Just pay us less; that’s what I would do. It isn’t exactly rocket science.”

The remuneration committee of the new BBC board will also approve the pay levels new staff and freelance talent above £250,000.

Local TV funding scrapped

Despite the increasing licence fee, and the growing number of households in the UK paying it, BBC funding will stay flat partly because it has to take on the cost of free TV licences for the over-75s (£745m per year).

The white paper states that this funding pressure on the BBC is “less than some in the industry are facing and less than those faced by many in the public sector”.

BBC funding for Local TV, which was the pet project of Jeremy Hunt as Culture Secretary under the last Coalition government, will be scrapped.

There are currently 20 local broadcasting mainly on Freeview Channel 8 in cities around the the UK. They benefit from £25m of licence fee money which was used to set up the transmission network and £5m a year over three years to buy their content for the BBC.

This meant each station might sell content worth £300,000 a year to the BBC under the arrangement.

Some 11 more stations are due to be launched this year and three more in 2017. There will be no additional funding for the fledgling network beyond the original £40m.

Tony Hall: White paper reaffirms our mission

Tony Hall, director general of the BBC, said: “This white paper delivers a mandate for the strong, creative BBC the public believe in. A BBC that will be good for the creative industries – and most importantly of all, for Britain.

“There has been a big debate about the future of the BBC. Searching questions have been asked about its role and its place in the UK. That’s right and healthy, and I welcome that debate.

“At the end, we have an 11-year Charter, a licence fee guaranteed for 11 years, and an endorsement of the scale and scope of what the BBC does today. The white paper reaffirms our mission to inform, educate and entertain all audiences on television, on radio and online.”

White paper available here in full – A BBC for the future: A broadcaster of distinction

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