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Press conference - opening statement by Sir Michael Lyons, Chairman of the BBC Trust
21 November 2008
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1. The role of the Trust
First, let me remind you what the Trust exists to do. It is the Governing body of the BBC.
The BBC Charter outlines the BBC’s public service mission, reflected in its six public purposes.
Put simply, our job is to ensure that the BBC meets that remit and in doing so, operates only in the interests of the public to whom it belongs.
This current Charter provides greater independence for the BBC from government. In return, the Trust is required to scrutinise all new service proposals and to test the work of BBC managers and to do that in an open and accountable way.
The Trust must therefore remain independent of BBC management on a day to day basis. But the Trust is the sovereign body of the BBC and so has the authority it needs to hold the management to account, to change policies and practice and to change the pattern of expenditures.
In one very real sense the BBC Trust is no different from the Board of any well run company. Our job is to get the best deal for our shareholders. The difference is, of course, that our shareholders are the British public who own the BBC and pay for it through their licence fees.
It is that search to protect and advance the interests of the public which is the common factor in all the decisions we are announcing this morning.
Whether it is the thorough testing of a new service proposal, the protection of editorial standards or what we pay senior managers in difficult times, we are guided by what we believe is in the best interests of the licence fee payers.
2. The Trust’s provisional conclusions on Local Video
Let me start with Local Video. This has been the subject of a Public Value Test – a PVT – which we apply to all new service propositions or significant changes to existing services. It is the latter that applies in this case.
Our PVT process is about gathering evidence and giving people and organisations outside the BBC the opportunity to offer us their views before we reach judgements.
This test is an important part of the new governance arrangements. It helps us make open and secure decisions in the public interest.
In applying a public value test to a proposal from BBC management, the Trust is seeking answers to the following two questions:
First, will this proposal generate enough value to the public to warrant the BBC investing the public’s money?
Second, what impact might this proposal have on others in the market place or who might expect to enter this market?
In the case of local video, our simple answer to the first question is that it would not. Whilst the public has made clear to us their wish for the BBC to work harder for them locally, the evidence shows that a new Local Video service producing around 240,000 items of content on websites each year costing £68m over four years is not the answer.
As to the second question, the assessment in Ofcom’s report, which forms part of the PVT process, is that the negative impact would be significant and could deter investment in the market.
In the case of the Local Video proposition therefore, we have judged that the proposal would not create enough value to the public to justify the investment of their licence fee monies and that this value is not great enough to offset the adverse market impact. The Trust has therefore rejected the proposal.
We have instructed that the funds totalling £68 million that were to be used to implement local video be removed from the Nations and Regions’ budget and returned to central control. We will consider how those resources are best deployed at some future time.
I’m going to invite Diane Coyle now to give us more detail about how the Trust arrived at its decision. I will speak further about next steps shortly.
[DIANE COYLE PRESENTATION]
The Trust’s message to licence fee payers is this:
The Trust will always put the public first when reaching big decisions about BBC services. We know the public feel the BBC is not working hard enough to reflect the areas where they live. But the public has also made it absolutely clear that this Local Video service is not the answer. Instead, they want better quality regional news and a better reflection of local communities in all BBC television.
We will make sure that these improvements are made so licence fee payers are served better.
Our message to the commercial media and all those who have expressed concern about the BBC’s proposals is straightforward:
For the foreseeable future BBC management must drop its plans to expand its online services as outlined in this application. Instead, the Trust has requested management to increase the quality of its existing television and radio services and – without an increase in budgets – its existing online services. Local newspapers and other commercial media have the assurance they need that the BBC does not intend to make this new intervention in the market. They can therefore sustain and improve their offering to the public secure in this knowledge and I hope they will do just that.
As part of the BBC management’s plans to create partnerships and to cooperate with others who provide a public service, the Trust is looking to the BBC to do more to support the provision of regional news in the United Kingdom, beyond that which people receive directly from the BBC. We hope to say more about this before long.
3. Editorial controls and standards at the BBC
Let me turn now to editorial controls and standards at the BBC.
At 12 noon today, the Trust will publish its findings on the Russell Brand show, and a report from BBC management which we discussed at our meeting this week.
I am now going to invite Richard Tait, Chairman of the Trust’s Editorial Standards Committee to outline the Trust’s findings. He will also outline the Trust’s findings on complaints received on appeal this month – as was always scheduled – about an edition broadcast in May of Friday Night with Jonathan Ross.
[RICHARD TAIT PRESENTATION]
Just to underline what Richard Tait has said. These editions of the Russell Brand show were gross breaches of the BBC’s editorial guidelines. The offending parts of the programmes should not have been recorded. Once recorded however, they should never have been broadcast. The Russell Brand breaches were all the more serious because of the misjudgements by those responsible for editorial control within the BBC.
Indeed, none of the breaches the Trust is reporting today should have happened. All of them could have been avoided. The issue which links them is a lack of editorial judgement by those in control.
Already the BBC has shown there are serious consequences when its people make the most serious mistakes and let down licence fee payers. In the case of Russell Brand, two senior editorial figures have left the Corporation.
Indeed, one of the BBC’s most prominent performers has been suspended for 12 weeks without pay.
But the Trust is in no doubt that primary responsibility rests with the BBC as publisher and it is the editorial management who are accountable for what the BBC broadcasts.
Richard has drawn attention to the management actions we have agreed. The management’s report lists these in full. This is what is going to happen.
There will be immediate steps to ensure a common understanding across the BBC of how the existing Editorial Guidelines should be interpreted in different genres.
This will be reinforced by tougher penalties for anyone failing to comply with procedures.
There will be tighter controls on programmes produced by an independent owned and/or managed by the featured performer or his agent. The management will present recommendations for new controls next month.
Within Audio & Music, a new register of high risk programmes has been set up and other steps are being taken to strengthen editorial compliance.
Once in place, we will review independently whether the changes made are having the right impact.
As you know, the BBC’s editorial guidelines are due for review in 2009. As part of this, we will consider the use of language and the boundaries of generally accepted standards and commission research and other work to understand audiences’ perspectives.
Let me absolutely clear. There is no place on the BBC for casual and gratuitous use of the most offensive language without clear editorial justification.
But this issue is not just about language. Indeed, too much focus on expletives could overshadow other offences which – depending on context – could be even more concerning to audiences.
It is too early to say whether the editorial guidelines themselves need to be revised. In all the cases we’ve discussed today, compliance with existing guidelines would have prevented offensive broadcasts.
What our findings show, is that a creative organisation needs to understand where the boundaries are and that they need to be properly policed. This kind of clarity generates the confidence needed to allow performers and artists to give of their best.
Creative risk-taking is an essential part of what the BBC is here to do. Every news story, every new show, every performance involves a risk. The BBC simply cannot justify receiving the licence fee if it is unwilling to take those risks. Indeed the Trust continues to argue that the BBC should take more risks with new talent, new ideas and new formats – constantly seeking to bring that something special and different to radio, television and online services. And it must continue to serve all audiences.
It is not our job to decide which shows or which artists appear on the BBC any more than it is right for us to influence the way the news is reported.
We are here to protect the independence of the BBC and to ensure that the Director General is free and able to attract the best possible talent. It is however our job to hold the whole BBC management to account and to ensure they maintain the BBC’s editorial standards, serve all audiences and achieve real value for money.
In the end, the BBC belongs to the people who pay for it. What is most important to the Trust is that those who make their living from the BBC understand this and – through their actions – demonstrate their understanding to the public.
Whilst this has been a disappointing and dismal episode, Mark Thompson and his top team have responded constructively and shown the leadership we expect. We look to his wider team and the many performers who represent the BBC publicly to join him and to learn the lessons of the last few weeks. The BBC also needs to learn some lessons about managing its public voice at such times.
However, let us not forget that the BBC proves every day that it usually gets things right. Recent outstanding journalism covering the big issues of the day: such as the US elections and the financial crisis. Big set pieces like coverage of the Olympics or the Remembrance services. Dramas like Little Dorrit. And innovations such as the Electric Proms.
I have one more important topic to cover relating to the current economic climate.
The BBC is not immune from the financial pressures facing all industries and licence fee payers. The Director General is currently reviewing his original six year financial strategy, and the Trust is discussing with him what changes might be necessary. We will have more to say about this early in the New Year.
In the light of the financial challenges currently facing the BBC, the Trust asked the Executive Board Remuneration Committee to look very hard at whether it would be appropriate to pay any bonuses to public service executive directors in 2009.
I have been informed by the Chairman of that Committee that, given the financial environment, all of these executive directors have agreed to waive their entitlement to any bonus in 2009. The DG has also informed me that, as in previous years, he will waive his entitlement to be considered for a bonus.
Let me close by restating where I began this morning. The BBC Trust exists to ensure the BBC operates in the interests of those to whom it belongs. It is our job to safeguard the future of the Corporation. To make sure it has adequate funding to meet its public purposes. To set the BBC’s strategic direction.
Overall, the BBC is performing strongly. Its journalism is authoritative and its other programming is attracting a strong response from audiences. The failings we have discussed this morning are being addressed. The BBC’s regional and local services on television and radio will be stronger without adversely impacting others. And the BBC will soon be ready to announce new ways for it to cooperate with others for the benefit of the public.
Licence fee payers can remain confident in the BBC’s future and that it is working to serve only them.
Ends.