Media: Is the BBC its own worst enemy?

Not while I'm around, says Gerald Kaufman, the man who is determined to show the corporation how to spend its money

At the end of the first of our two evidence sessions with the BBC bosses during the inquiry into BBC funding by the Select Committee on Culture, Media and Sport, a member of the committee said to me: "Until I heard these witnesses, I supported their plea for extra money for digital TV. Now I don't."

Another select committee colleague muttered: "The BBC are their own worst enemy." I refrained from retorting, in the immortal words of Ernest Bevin: "Not while I'm alive." I am, you see, an admirer of the BBC. Lord Reith created the concept of public service broadcasting that has permeated world communications and set the highest standards first for radio, then for television and now for the Internet.

Why, then, do I agree with the report of the select committee, published yesterday, which says that the BBC's plea for extra money to fund the expansion of its digital TV services should be turned down, whether that extra money takes the form of a supplement to the licence for those receiving digital TV or a smaller addition to all TV licences? My view stems partly from my reluctance to award the BBC any more licence money between now and 2002. The current licence fee arrangement was decided in 1996 by the Tory government; Labour endorsed the formula when it came to office the following year.

That licence settlement was skewed to be higher in its earlier years precisely because of the plans to introduce digital television embodied in the Broadcasting Act 1996. While commercial interests had to bid for air-space, the BBC was guaranteed a platform. That is why Virginia Bottomley, as secretary of state for national heritage, provided for a 13 per cent licence increase in the first three years of the new BBC charter period. The chairman of the BBC said of that licence settlement: "We do now have a financial framework in which we can plan for five years ahead."

So it knew what it was getting, it knew what to plan for and accordingly it went ahead. But did it plan? Do me a favour. When, earlier this year, it told the Gavyn Davies panel, set up to consider BBC digital funding, that it needed another pounds 700m, it could not explain what it planned to do with pounds 400m of that sum.

But then, the BBC does not seem very good at explaining figures that it provides. When we asked it how much it had been spending on promoting digital TV, at first it could not say, then it sent us a memorandum specifying certain sums of money, then, when asked to explain its memorandum, it gave us, after apparent bafflement, an explanation. Then, after thinking the matter over, it gave us an entirely different explanation.

When we asked it how many people were watching one of its new channels, News 24, at first it told us it would have to check up. Then it checked up and gave us such a hotch-potch of statistics that it was almost impossible to work out exactly - or even roughly - how many people were watching the channel. When we did work it out, we found that scarcely anyone was watching BBC News 24 for sustained periods.

So we were dissatisfied with the financial information and viewing figures supplied to us by the BBC. But even if we had been satisfied, we had to take into account two irrefutable facts. The first was that, even if they wanted to watch only the commercial digital services they had voluntarily paid for, customers of the SkyDigital and ONdigital services would also have to pay a fine - the digital licence supplement. That unfair prospect seemed to put paid to such a supplement.

If we swung away from a supplement, towards an addition to all licences, we had to bear in mind that under a general licence increase, TV viewers would have to pay for digital services even if they did not want them at all. Both a supplement and a general licence increase meant unacceptable injustice, quite apart from the total exclusion by Chris Smith, the Secretary of State for Culture, Media and Sport, of a general licence increase above the current five-year formula. Those considerations precluded, in the committee's view, any more money for BBC digital TV. But an even more important question, to which we never did receive a satisfactory answer, related to what the BBC now has as a strategy - if it has a strategy at all.

For 60 years or so the BBC was the trail-blazing pioneer in radio and TV. The licence was introduced not as a method of funding radio services but as a tax on the ownership of a wireless set, analogous to the tax on owning a dog. As the only organisation legally permitted to provide wireless services, the BBC was given the licence revenues. It was, and remains, the only long-lasting example of a hypothecated tax going to a designated recipient.

Before the Second World War the BBC started up a television service and, when the war was over, it resumed and expanded that service. As the only TV provider, it continued to take the licence money. It expanded its TV channels to two. It introduced colour TV. It introduced the 625-line format, which gave better pictures than the outmoded 405-line format. It continued to be the pioneer and it continued to pocket the licence revenues.

When satellite television came along, the BBC's pioneering role came to a halt. It was commercial companies that introduced sports channels and movie channels and round-the-clock news channels. The BBC tagged along behind, with a partnership in the UK Gold satellite channel and material supplied to the Discovery channel.

It was the commercial companies that blazed the trail in subscription digital TV services and that, by September of this year, had signed up 2.25 million subscribers while scarcely anyone had the specific objective of watching BBC digital channels. The BBC, instead of leading the field, was panting along in the rear, trying to find gaps in the market and, according to aggrieved competitors, using licence money to duplicate services that commercial companies were financing out of their own resources.

Should the BBC give up, withdraw to its core TV channels and turn into a British equivalent of the American begging-bowl service PBS? Not in the opinion of our committee. There is one area of audio-visual communications in which the BBC leads the field, providing a top-class service while its commercial opponents are hardly even trying: BBC Online.

The BBC Online service is probably the most popular Internet service in the world; it is certainly the best on news and information. And, while the viewers of BBC digital TV are too few to be counted in any meaningful way, the users of BBC Online can be numbered in their millions. Yet the BBC is spending more than twice as much on just one BBC service, News 24, as on BBC Online.

The BBC can lead the world in Internet services if it changes its priorities. If it took advertising on BBC Online - though there might be problems with EU regulations if it tried to do so at present - instead of consuming licence money, it could earn profits to help fund the rest of its services. That is why our committee recommended incorporating BBC Online into the Beeb's commercial arm, BBC Worldwide. That, too, is why we oppose the Davies recommendation that 49 per cent of BBC Worldwide should be privatised.

Gerald Kaufman MP is chairman of the Select Committee on Culture, Media and Sport

Arts and Entertainment
Ellie Levenson’s The Election book demystifies politics for children
bookNew children's book primes the next generation for politics
Arts and Entertainment
Pharrell Williams' “Happy” was the most searched-for song lyric of 2014
musicThe power of song never greater, according to our internet searches
Arts and Entertainment
Roffey says: 'All of us carry shame and taboo around about our sexuality. But I was determined not to let shame stop me writing my memoir.'
Arts and Entertainment
Call The Midwife: Miranda Hart as Chummy

tv Review: Miranda Hart and co deliver the festive goods

Arts and Entertainment
The cast of Downton Abbey in the 2014 Christmas special

tvReview: Older generation get hot under the collar this Christmas

Have you tried new the Independent Digital Edition apps?
Arts and Entertainment

ebooksNow available in paperback
Arts and Entertainment

Arts and Entertainment
Transformers: Age of Extinction was the most searched for movie in the UK in 2014

Arts and Entertainment
Mark Ronson has had two UK number two singles but never a number one...yet

Arts and Entertainment
Clara Amfo will take over from Jameela Jamil on 25 January

Arts and Entertainment
This is New England: Ken Cheeseman, Ann Dowd, Frances McDormand and Richard Jenkins in Olive Kitteridge

The most magnificently miserable show on television in a long timeTV
Arts and Entertainment
Andrea Faustini looks triumphant after hearing he has not made it through to Sunday's live final

Arts and Entertainment
Rhys says: 'I'm not playing it for laughs, but I have learnt that if you fall over on stage, people can enjoy that as much as an amazing guitar solo'
musicGruff Rhys on his rock odyssey, and the trouble with independence
Arts and Entertainment
Krysia and Daniel (Hand out press photograph provided by Sally Richardson)
How do today's composers answer the challenge of the classical giant?
Shenaz Treasurywala
Arts and Entertainment
Jason Watkins as Christopher Jefferies
Arts and Entertainment
Star Wars Director JJ Abrams: key character's names have been revealed
Arts and Entertainment
Pharrell Williams won two BBC Music Awards for Best Song and International Artist
Arts and Entertainment
Mark, Katie and Sanjay in The Apprentice boardroom
Latest stories from i100
Have you tried new the Independent Digital Edition apps?

ES Rentals

    Independent Dating

    By clicking 'Search' you
    are agreeing to our
    Terms of Use.

    War with Isis: The West needs more than a White Knight

    The West needs more than a White Knight

    Despite billions spent on weapons, the US has not been able to counter Isis's gruesome tactics, says Patrick Cockburn
    Return to Helmand: Private Davey Graham recalls the day he was shot by the Taliban

    'The day I was shot by the Taliban'

    Private Davey Graham was shot five times during an ambush in 2007 - it was the first, controversial photograph to show the dangers our soldiers faced in Helmand province
    Revealed: the best and worst airlines for delays

    Revealed: the best and worst airlines for delays

    Many flyers are failing to claim compensation to which they are entitled, a new survey has found
    The stories that defined 2014: From the Scottish independence referendum to the Ice Bucket Challenge, our writers voice their opinions

    The stories that defined 2014

    From the Scottish independence referendum to the Ice Bucket Challenge, our writers voice their opinions
    Stoke-on-Trent becomes first British city to be classified as 'disaster resilient' by the United Nations

    Disaster looming? Now you know where to head...

    Which British city has become the first to be awarded special 'resilience' status by the UN?
    Finally, a diet that works: Californian pastor's wildly popular Daniel Plan has seen his congregation greatly reduced

    Finally, a diet that works

    Californian pastor's wildly popular Daniel Plan has seen his congregation greatly reduced
    Say it with... lyrics: The power of song was never greater, according to our internet searches

    Say it with... lyrics

    The power of song was never greater, according to our internet searches
    Professor Danielle George: On a mission to bring back the art of 'thinkering'

    The joys of 'thinkering'

    Professor Danielle George on why we have to nurture tomorrow's scientists today
    Monique Roffey: The author on father figures, the nation's narcissism and New Year reflections

    Monique Roffey interview

    The author on father figures, the nation's narcissism and New Year reflections
    Introducing my anti-heroes of 2014

    Introducing my anti-heroes of 2014

    Their outrageousness and originality makes the world a bit more interesting, says Ellen E Jones
    DJ Taylor: Good taste? It's all a matter of timing...

    Good taste? It's all a matter of timing...

    It has been hard to form generally accepted cultural standards since the middle of the 19th century – and the disintegration is only going to accelerate, says DJ Taylor
    Olivia Jacobs & Ben Caplan: 'Ben thought the play was called 'Christian Love'. It was 'Christie in Love' - about a necrophiliac serial killer'

    How we met

    Olivia Jacobs and Ben Caplan
    Bill Granger recipes: Our chef's breakfasts will revitalise you in time for the New Year

    Bill Granger's healthy breakfasts

    Our chef's healthy recipes are perfect if you've overindulged during the festive season
    Transfer guide: From Arsenal to West Ham - what does your club need in the January transfer window?

    Who does your club need in the transfer window?

    Most Premier League sides are after a striker, but here's a full run down of the ins and outs that could happen over the next month
    The Last Word: From aliens at FA to yak’s milk in the Tour, here’s to 2015

    Michael Calvin's Last Word

    From aliens at FA to yak’s milk in the Tour, here’s to 2015