S4C seeks judicial review over BBC funding move

The UK government plan will transfer funding of the channel to BBC in 2014 and cut its budget by a quarter by 2015.

S4C is to launch a judicial review of the decision to transfer responsibility for its funding to the BBC.

S4C chairman John Walter Jones said it was "effectively" a merger and would be "disastrous" for viewers.

The channel faces funding cuts by 2015 but the UK culture minister said everyone had to make savings in "tough" times.

Ed Vaizey said when the dust had settled, people would understand the deal gave S4C "a fantastic future".

He said the channel might be able to save on administration and also take advantage of the BBC's "expertise".

BBC director general Mark Thompson said the arrangement would help safeguard Welsh language broadcasting.

The BBC, whose licence fee is to be frozen for six years, is also to fund the BBC World Service and BBC monitoring service as part of the new arrangements.

The decision was confirmed by Chancellor George Osborne as part of the Spending Review, which also confirmed the S4C budget will be cut by 25% by 2015.

Start Quote

John Walter Jones

I am astounded at the contempt that the London government has shown ”

End Quote John Walter Jones Chair, S4C Authority

It is understood that the BBC will start to "part-fund" S4C.

S4C is unhappy at both the decision and the way it was taken.

Mr Jones said it would mean the BBC would have effective control over the finances and operations of the channel.

He first heard of the plans on BBC Radio Cymru on Tuesday evening.

"The effect of the financial cuts agreed between Jeremy Hunt and the BBC will have a disastrous effect for viewers across Wales, and this at a time when the BBC has already cut spending on both English and Welsh language programming in Wales," said Mr Jones.

"I am astounded at the contempt that the London government has shown not just towards S4C, but also towards the Welsh people and indeed the language itself.

Analysis

The news that the BBC is to have responsibility for funding S4C in the future sent shockwaves through the Welsh political and media establishment.

It was an option that had been canvassed by the Department for Culture Media & Sport (DCMS) in private meetings over the past couple of months, but well-informed Westminster sources told BBC Wales last week that they believed it was definitively off the table.

Indeed, in the so-called 'bonfire of the quangos' last Thursday, S4C was told that its inflation-linked funding would be scrapped and in future the UK Culture Secretary would decide its budget.

No hint there of any tie-up, financial or otherwise with the BBC.

All that seemed to have changed on Tuesday afternoon. The chair of the S4C Authority, John Walter Jones was only briefed that evening, and the Welsh heritage minister Alun Ffred Jones was not given any details at all.

Broadcasting isn't a devolved matter, so there was no obligation on the DCMS to inform the assembly government of the developments, but ministers in Cardiff Bay are furious at what they see as a blatant breach of the 'respect agenda', given the social, cultural and economic importance of S4C to Wales.

Once the anger has subsided though, attention will quickly turn to how the new, much closer relationship between the BBC and S4C is going to work in practice.

The recent boardroom difficulties within S4C, culminating in the departure of chief executive Iona Jones, are a graphic illustration of why governance and accountability are so vital to the smooth running of organisations.

It appears that the model being proposed is a joint management board to govern the relationship between the two organisations. However, this would also need to satisfy the DCMS's requirement for S4C to have operational independence from the BBC - a tricky line to walk.

It appears that S4C will undergo a series of staged cuts to its £102m budget up until 2015 after which the BBC is due to take over full responsibility for the broadcaster. Between now and then the DCMS is expected to reduce its contribution to S4C year on year. The BBC will then be expected to top up S4C's budget from the licence fee, this may with its contribution growing year by year as the government grant diminishes. By 2013 the BBC contribution could be as much as £76m.

With the S4C Authority now launching an attempt for a judicial review of the changes - with backing from many politicians - the actual arrangements may be a long way from being finalised.

He added that he was told by the Culture Secretary that it was a non-negotiable agreement only after they were leaked on the BBC last night.

"This is no way to conduct public affairs and surely is an affront to the good conduct of public policy and the democratic process," he said.

Shadow Welsh Secretary Peter Hain said Labour will support S4C in seeking a judicial review.

"The government have handled the whole issue very badly. There has been no consultation with the Welsh Assembly Government or with S4C themselves," Mr Hain said.

A Department of Culture, Media and Sport spokeswoman said: "The government is committed to Welsh language programming and in the current spending environment we believe the best way to deliver a better service to the audience in the future is through partnership with the BBC.

The spokeswoman added they have had no formal notification of any intention to seek judicial review on the decision.

The DCMS said funding for S4C will be cut by 24%, in line with cuts to the department's own budget.

Deputy First Minister Ieuan Wyn Jones described as "shameful" the lack of consultation with S4C and with Welsh ministers about the decision to fundamentally change the broadcaster's funding.

Mr Jones also told assembly members that "we will not put up with the loss of independence of S4C in this place."

In the Welsh Assembly, Culture Minister Alun Ffred Jones condemned a decision that he said was taken "in haste" and which undermined the prime minister's ambition for a relationship of respect between Wales and Westminster.

He called for an independent inquiry to provide a new model for providing Welsh language television.

Mr Jones, who earlier expressed his surprise and anger at not being informed about the move, told AMs: "I have made my feelings clear about the lack of consultation and discussion."

"Certainly the respect agenda was thrown out of the window without ceremony.

"We are witnessing now what amounts to an attack on Welsh language broadcasting."

Mr Jones also denied that there had been any discussion of transferring S4C to assembly government.

Start Quote

The BBC already provides news for S4C, and when you are looking at a reduced funding environment, not just S4C, everyone has to make savings”

End Quote Ed Vaizey MP Culture Minister

The BBC will have to part-fund the channel which also has revenue from advertising.

It is understood that by 2013-14, the BBC will be contributing something in the region of £76m to the running of S4C, while the UK government share will by that point be no more than "a few million".

BBC Wales director Menna Richards said: "Along with the BBC Trust, we must now look carefully at how this new partnership approach might work between the BBC and S4C, mindful that the over-riding priority must be to ensure that Welsh language audiences continue to enjoy a high quality and distinctive television service.

"The BBC is also well aware that the contribution of the independent sector has been central to S4C's development as a channel.

"We have confirmed to UK ministers our intention that the BBC's increased investment in programming on S4C should be spent with these external suppliers."

Ed Vaizey, UK Culture Minister, defended the deal and said it was in the best interests of S4C "in a tough spending environment".

He said for the first two years the UK government would continue to fund S4C, before the majority of funding would transfer to the BBC from 2015.

Mr Vaizey said it was a "huge opportunity" for S4C to participate in the expertise of the BBC.

"The BBC already provides news for S4C, and when you are looking at a reduced funding environment, not just S4C, everyone has to make savings," he said.

"There may be scope, for example, to save on administration by working with BBC in order to continue to provide the all-important frontline programmes that S4C is so well known for."

He said any spending review meant tough decisions, which sometimes went to the wire, but they would never do anything "on the back of a fag packet".

"When the dust is settled and the feathers are de-ruffled, people will understand that this gives S4C a fantastic future," he added.

Chancellor George Osborne, in his address to MPs, said the BBC would fund BBC World Service and BBC Monitor as well as part-funding S4C, saving the Treasury £340m a year, with the licence fee frozen for the next six years.

It is equivalent to a 16% saving in the BBC budget over the period.

BBC director general Mark Thompson said: "We will help safeguard the future of Welsh language television broadcasting by extending the current partnership we have with the Welsh language channel S4C, along similar principles to the BBC Alba service in Scotland from 2013-14."

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