BBC warns new licence fee means fewer, high quality productions

Published Tuesday 23 January 2007 at 14:45 by Liz Thomas

“This is not the slow death of the BBC,” said Secretary of State for Culture, Media and Sport Tessa Jowell, just a few hours after delivering news that the Corporation’s licence fee settlement for the next Charter would be significantly below expectations.

For the first time, the levy will not be tied to the rate of inflation, so for the next two years viewers can expect an increase of around 3% - after that the figure drops - leaving the broadcaster with the stark reality that some of its programmes and services will have to go.

This of course, has caused concern both within the organisation and outside it, a shrunken settlement will have a direct impact on output and in big budget areas including comedy and drama this is going to have a more pronounced effect because of the level of investment involved.

A senior drama source at the BBC told The Stage “There isn’t an atmosphere of hand-wringing but there is a resigned feeling that this will mean fewer pieces. We were already going down the route of fewer, high quality productions - so we will have to think more along those lines.”

Insiders at the Corporation say that moves to make savings will go into hyperdrive, with some services and proposals for the future abandoned, more jobs to go, more repeat programming and iconic landmarks including Television Centre and the Maida Vale Studios up for sale.

Christine Payne, Equity’s general secretary, warned: “Equity is concerned about the impact of a below inflation increase on the ability of the BBC to continue to make world class drama and entertainment. The BBC is a British success story which could be so easily damaged by underfunding.”

Despite this, talk of a death knell for the Corporation is at best unlikely and at worst premature but what is clear is that in the next few years the broadcaster and indeed the idea of public service broadcasting as a whole will be drastically different.

At the recent Oxford Media Convention, Ed Richards, chief executive of media regulator Ofcom, revealed that this week he would be launching a consultation on the delivery of such content.

He added that the watchdog would begin its review of the role of a public service publisher next year and added that there was a need for an organisation with a “centre of gravity firmly in new media” - either attached to something already in existence or an entirely new entity. One suggestion is that it would concentrate on interacting with the public as content creators, rather than simply as consumers, and will come into force in 2012 - at the end of the current licence fee settlement and as the analogue switch-off process draws to a close.

Richards said that the area needed to be re-assessed because of the dramatic changes in broadcasting over the past few years.

“Digital uptake and the rise of PVRs [personal video recorders] have outstripped the predictions made three years ago,” he explained. “BBC1 and ITV1 in particular have seen faster declines than expected.”

The inference is that the traditional expectations from public service broadcasting are becoming less and less applicable and if new models need to be looked at, then the redistribution of money is a factor. It is understood that the publisher would cost around £300 million. This could lead to a situation in the long term, where the BBC’s now already diminished licence fee is further sliced in the future.

At the conference, Jowell gave tacit approval to Ofcom’s proposals, saying that if they were to go ahead then money could again be ring-fenced from the licence fee to help fund it. The culture secretary’s comments come after her department set aside £800 million in the latest settlement for the aid of vulnerable groups during digital switchover and is a sure sign that it will do so again if necessary.

She said: “Both broadband and digital switchover provide the context for the underlying questions facing us all: ‘What sort of television do we want in this country in five to ten years time? What will be the respective contributions of both the private sector and public service broadcasters to achieve these objectives? We need to develop a digital media vision and that is where attention should now begin to shift.”