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BBC: Chairmanship (Communications Committee Report)

Volume 696: debated on Wednesday 21 November 2007

rose to move, That this House takes note of the report of the Communications Committee on The Chairmanship of the BBC (First Report, Session 2006-07, HL Paper 171).

The noble Lord said: My Lords, I shall give the Minister time to pick up his new script. It would be quite unfair of me to say that we are moving from dormant bank accounts to the dormant Department for Culture, Media and Sport, but we are certainly moving.

Last week, I received a wonderfully double-edged recognition of our work. It was at the premiere of the new and vastly enjoyable film “Cranford”. The Evening Standard diary reported that there was a glittering attendance: Judi Dench and Eileen Atkins, and from the world of politics Neil Kinnock and Geoffrey Howe. It added that Norman Fowler was also there, presumably because he was chairman of the House of Lords Communications Committee. So there we are. The Liaison Committee will be pleased to note that, after a certain amount of constructive debate, the Communications Committee has now been well and truly established in the BBC’s mind as a successor to the BBC Charter committee, and established with a wide and experienced membership, many of whom served on the original BBC committee and whom I thank for all their effort and commitment.

Indeed, I am glad to say at the outset that the Government have now accepted one of the principal recommendations of the BBC committee, which should be noted. When we reported on the charter, we stressed the importance of the BBC World Service, which has great influence throughout the world. We welcomed the proposal by the BBC to start an Arabic language television service, but we were strongly critical of the inadequate funding offered by the Government which allowed only a 12-hour service. We could not see how such a service could compete with the already established 24-hour broadcasters—Al-Jazeera and the rest—although, for very little extra cost, the BBC could also offer a 24-hour Arabic language service. I strongly welcome the Government's decision to make more funds available so that a proper 24-hour Arabic language service can now be provided. I congratulate the Minister on that, and will not embarrass him by quoting the reasons he consistently gave us for why this eminently sensible step was entirely impossible and unnecessary. The important thing is that it has been done. We hope that, whatever may have been the initial response to our report on the chairmanship of the BBC, in the end Ministers will agree with all our proposals here as well.

In part, this inquiry was provoked by the sudden resignation of Michael Grade as chairman of the BBC and his just as sudden transfer to the executive chairmanship of ITV. The BBC had already lost one chairman quite recently and here was another, this time not only resigning but switching to the BBC’s direct competitor. I remember the response of the Minister—who is replying to this debate—when the point was put to him in this House. His response was:

“it is a free country”.—[Official Report, 30/11/06; col. 848.]

I doubt if the Minister can say with a straight face that this was the immediate reaction in the Department for Culture, Media and Sport when the news first came through. I doubt that Tessa Jowell did a little jig to celebrate the free and successful working of the market. It seems altogether more likely that there was a collective chewing of the carpet at the totally unexpected departure of a chairman who everyone thought would serve a full term, not least to see through the new governance arrangements for the BBC he had agreed and to work through the consequences of the new licence fee settlement.

As our report makes clear, we recommended that the chairman of the new BBC Trust should be subject to a six-month notice period. We thought it absurd that the BBC could be left virtually without notice in this potentially vulnerable position. The Government's response was that the charter provided only very limited powers for setting terms relating to the chairman’s employment; although it is perhaps relevant to point out that the Government could have taken such powers in the charter that they have only recently provided for the BBC.

Nevertheless, I welcome the statement in the Government’s response that, in the absence of legal power to make such provision, they accept the need to establish a clear understanding between the department, the BBC and the chairman about the requirements of the role, including the expected length of term of appointment. The understanding on the length of term of appointment for the current chairman, as in the Government’s response, was set out in writing and will be for future appointees. That is a sensible step forward. I also welcome what the BBC Trust said about a non-compete clause. We proposed six months; the BBC Trust said in effect that the current non-compete clause in the trust’s code of practice is for three months, introduced voluntarily by the trust earlier in 2007 following Michael Grade’s departure. Legal advice at the time was that the enforceability of any non-compete over three months was doubtful. We obviously accept that advice and welcome the steps that have been taken.

I am not going to describe in a short speech each and every recommendation that we made. In the process of appointing a chairman, we have tried to set down a procedure that would make the selection as open, transparent and independent of government as possible. We proposed, for example, that the chairman of the independent selection panel should no longer be a civil servant who, by definition, works to a Minister. We proposed that the Secretary of State’s powers to make the final choice should be more limited than at present. Perhaps not surprisingly, Ministers are entirely happy with the present position, given their power, so we will have to wait for change there.

However, there is one point where I think the Government should look at policy immediately. The members of the committee all remember a rather embarrassing moment in our evidence-taking when Mr Woodward—who I remember as my director of communications at Conservative Central Office but appeared before us as broadcasting Minister of the current Government—declined to answer some questions before he had checked back with headquarters whether this was allowed. Eventually it was agreed that he was allowed to answer, but it poses the question of whether other information was being withheld. I say that because under the Freedom of Information Act the department has now provided copies of the Civil Service submission to the Secretary of State on whom to appoint as chairman of the BBC Trust, including how the appointment was to be handled and announced. I observe that those documents were never offered to the committee, and it would be an enormous pity if departments were not to offer maximum information to parliamentary Select Committees. I suggest that the fundamental recommendations in this report are to deal with the role of the chairman and the role of Parliament.

On the role of the chairman, I suspect that there is still a great deal of public confusion because Sir Michael Lyons is not the chairman of the BBC, but chairman of the BBC Trust. “Chairman of the BBC” is now only an honorary title and Sir Michael is not chairman in the way that that has previously been understood at the BBC. Very substantially he is a regulator: his stated aim is to represent the licence fee payer. The question then becomes who is representing the BBC. At the time of the faked phone-ins, we thought that the director-general looked an isolated figure when he was trying to explain what had gone wrong. Of course, I do not believe for a moment that the BBC chairman or any other chairman should be there to defend the indefensible, but he should be there to advise and support and to tell management when he thinks that things are going wrong. That is what happens in the best companies in the private sector. It is what good governance is all about.

However, it is also the case that a corporation such as the BBC has legitimate interests that need to be expressed. For example, there is a gathering debate on whether the licence fee should be top-sliced for purposes apart from those of the BBC and for other companies. It is entirely legitimate and expected for the BBC to enter that debate and argue against top-slicing. We would expect it. It has already had £600 million sliced off the licence fee to support social spending on helping people in need with the digital switchover, yet curiously when the question of top-slicing the licence fee was put to Sir Michael Lyons at a recent meeting I was at, his reply was to the effect that he was keeping an open mind on the issue. I can think of no chairman in the past giving such a reply. They would quite legitimately put the case for the BBC, against, I have to say, some very organised opposition organisations which, for one reason or another, argue in favour of top-slicing.

I emphasise this not in any way as a personal criticism of Sir Michael. He has certainly impressed me, and not just because he lives in my old constituency of Sutton Coldfield. It is a criticism of the structure of the job he has been given. I would much prefer him to be chairman of a regular board jointly responsible with the executive for the success of the BBC. If I am allowed a personal aside, I see that the Commons committee has come out in favour in principle of top-slicing the licence fee. In the now famous words of the noble Lord, Lord West¸ I need to be convinced of the case, and I may not be converted quite as quickly as the noble Lord.

My final point concerns the role of Parliament. We had hoped that the Government would agree that the chairman of the BBC Trust should be one of the appointments which could be scrutinised by a parliamentary Joint Committee which would focus simply on his qualifications and aptitude for the job. Predictably, the Government rejected that. I say “predictably” because, as we say in our report, there is a democratic deficit concerning the BBC. This is a point on which the committees in the Commons and the Lords speak as one. Although the public are providing more than £3 billion a year through the licence fee, they have very limited power through Parliament to change anything. Parliament—particularly the Commons—is the only body that can claim to represent the public, yet the new charter of the BBC, including the new arrangements for the chairmanship, was not subject to approval by Parliament. It was a deal between the BBC and the Department for Culture, Media and Sport. It is virtually the same with the licence fee; it does not need a debate in either House and proceeds by negative resolution, which means that even if there is a debate Parliament has only the choice of accepting or rejecting it. There is no power to amend; for example, there is no power not to accept that the £600 million of social spending should come from the licence fee.

I know that there are those in the BBC who are wary of any parliamentary check. To them I say that if the £600 million funding for targeted help with the switchover had been put in legislation that Parliament could have amended, my judgment is that it would have been amended. How can you say that free television licences are social spending to come from the Exchequer but that helping old people with digital switchover is not? It is logically unsustainable. In the same way, there would have been a fierce debate on the charter provisions relating to the role of chairman of the BBC, and I am by no means certain that that would have got through either.

The Government's answer, which is set out in their response, is that their public opinion research does not favour what they call in their response,

“increased Parliamentary control over the BBC”.

In truth, the research shows no support for government control over the future of the BBC either, but, of course, the Government are not reducing their powers accordingly. It is a pity that the department keeps on quoting that opinion research because, to be frank, it is hardly worth the paper that it was written on and would be worth even less if the issues were properly set out for the public. I simply observe that there might be those in the BBC today who would place more trust in Parliament than in Governments of any party.

I am very grateful to all those who gave evidence to the committee. I am very grateful to the committee, a number of members of which are here tonight. I welcome the movements to our point of view that have been initiated by the Government and the BBC Trust. However, I warn that confusion and some conflict remain on the role of the chairman of the BBC Trust. Above all, I believe that Parliament should be more involved with some of the important decisions affecting the BBC, such as the charter and the licence fee that raises more than £3 billion from the British public. I beg to move.

Moved, That this House takes note of the report of the Communications Committee on The Chairmanship of the BBC (First Report, Session 2006-07, HL Paper 171).—(Lord Fowler.)

My Lords, I speak as a member of the Communications Committee, but as a new bug who is not speaking with the benefit of having been a member of the previous committee; I was highly privileged. I thank the noble Lord, Lord Fowler, our greatly esteemed chairman, for introducing the report so elegantly.

I do not want to detain the House long because I want to address only one issue in the report. In doing so, I intend to amplify a point already raised by the noble Lord, Lord Fowler. It relates to the first recommendation of the report which concerns the lack of clarity about the role of chairman of the BBC Trust. We noted that:

“Article 10 of the new Royal Charter states that there is no longer a formal Chairman of the BBC ‘The Chairman of the Trust may also be known as the Chairman of the BBC. In view of article 8, this is an honorary title, as the members of the BBC will never act as a single corporate body, but only as members of the Trust or Board to which they belong.’”

That is a rather curious form of words, in my estimation, but what it really means, as the report points out, is that the chairman of the BBC trust and the director-general, who chairs the executive board, can no longer stand together representing one organisation. The report observes at paragraph 7:

“This is a radical change and one that concerns us”.

The committee spent quite a lot of time with a number of witnesses trying to figure out how that relationship worked or will work in practice. In particular, we were concerned to understand the implications of the trust’s primary responsibility to represent the interests of the licence fee payer. I think that it is fair to say that we were not a whole lot clearer at the end than we were at the beginning. Even Sir Michael Lyons, who gave us a generally robust and lucid account of his new responsibilities, when talking about the new governance arrangements, conceded that:

“there is no doubt that this is a complex arrangement”.

One can only agree with him.

The question at the heart of the matter is whether the trust, under the new arrangements, is or is not a de facto regulator. The then Minister, my right honourable friend Mr Woodward, Mr Ramsay, the civil servant who gave evidence with him, and Sir Michael Lyons himself all strove in various ways to convince us that it is not, but the way in which recent controversial events at the BBC have been handled suggests that the role of the trust in its affairs is closer to regulation than to anything else, as the report notes at paragraph 16.

In the wake of the cataclysm that overtook the BBC after the Hutton report, it is no surprise that the Government and the BBC sought through the charter provisions to protect against any such disaster occurring again. I have no problem with that and accept that some change is inevitable. The question is whether what is now in place has created a new set of problems. In particular, I am concerned that, in the new order, the BBC is more vulnerable than it was before—in this respect, I agree with the noble Lord, Lord Fowler—because its sovereign body, the trust, has as its principal responsibility not the interests of the BBC but the interests of licence fee payers.

In their response to recommendation 1 of the report, which states:

“It should be clear whose job it is to represent the BBC itself, as distinct from the licence fee payer, what it means to represent the licence fee payer”,

the Government say:

“the Trust and the Executive Board both have a responsibility for representing the interests of the BBC within the context of the particular functions of each body. By representing the licence fee payer, we mean taking on the role of understanding and bringing to bear the public interest on the activities of the BBC”.

I am tempted to say, pick the bones out of that.

My question to my noble friend is this. The BBC has been much in the spotlight since the committee's report was published. Is he satisfied that the new governance arrangements have stood up well to the challenges that they have faced? In carrying out its duty to represent the interests of licence fee payers, has the trust in fact been acting primarily as a regulator? If so, has that left the BBC itself—and the director-general in particular—without a robust champion?

My Lords, it has been a great pleasure to continue my interest in media matters under the eyes and experienced chairmanship of the noble Lord, Lord Fowler: first, during the ad hoc Select Committee’s examination of the BBC charter review process; and, since then, on the reconvened Communications Select Committee, whose main current project concerns media ownership and the news.

The very fact that a number of members appointed to the Communications Select Committee had also served on the previous committee on the BBC charter meant that the committee was ideally placed, as an initial short project, to examine the unexpected and, in my mind, rather shocking resignation of the then chairman of the BBC, Michael Grade, and to help to identify possible lessons that might be learnt for future such appointments.

As we say in the report, the chairman of the BBC is not subject to any formal contract because the chairman—and, rather surprisingly, members of the new BBC trust—are considered officeholders, not employees. Therefore, there was, for example, no “non-compete” clause to prevent Mr Grade accepting the offer to chair ITV, the BBC's main competitor. Mr Grade certainly made it clear in his evidence to the committee that, once in the saddle at ITV, he would not have acted on any confidential BBC information in his possession. However, not unnaturally, many licence fee payers would have been less than fully convinced by that. The mere fact of his leaving the BBC without a chairman before the final licence fee funding had been agreed would, if nothing else, have weakened the BBC's negotiating position and, for some, Mr Grade’s credibility.

This has been mentioned by other noble Lords and will no doubt be commented on by noble Lords, but I draw particular attention to our recommendation to include a six-month non-compete clause in the contract of any future appointment to the chairmanship of the BBC. I think that we should still stick to the six months as being a reasonable period, although I hear what my chairman said, and always listen very attentively to that.

That, and other details that we recommend for increased transparency about who chairs and serves on the Secretary of State's appointment panel and about the process to be followed will, I hope, also be accepted. There is very little doubt that many of the procedures adopted in the latest appointment process were worrying. For example, if it had turned out that the Secretary of State’s own added candidate had been chosen, as referred to in chapter 3, paragraph 22, that might have caused quite an eyebrow lifting. The appointment of Sir Michael Lyons was certainly appropriate. I was personally very impressed by his performance but, as we say in chapter 3, paragraph 18:

“We do not believe the quality of the outcome validates the process”.

I also hope that the recommendation to involve both Houses in pre-appointment parliamentary scrutiny for the chairmanship of the BBC will, on reflection, be accepted. I say that with some reluctance myself, for my view has always been that the last thing needed by or for the BBC was further parliamentary involvement or oversight. The BBC has always managed to stand up to ministerial pressure from all political parties. However, post-Hutton and the subsequent BBC resignations, events have sadly changed all that. Now I feel that there must be a role for both Houses of Parliament for, in today's world, those procedures are more relevant. They also take account of the newly shared responsibilities between the BBC executive board and the BBC trust—about which we overheard in considerable detail, when important points have been made—and, perhaps especially, the trust’s enhanced accountability to the licence fee payer, as well as its additional regulatory responsibilities.

I have one more concern, which is that there may still be other appointments like those of the BBC which still do not fall completely within the scrutiny of the Commissioner for Public Appointments and/or follow Nolan principles. I asked the Library about that and it kindly sent me details of current practices, which I feel should reassure me. Is the BBC really the only remaining body that appears to have felt it safe to assume and to rely on honourable behaviour by a “great and good” incumbent, rather than spelling out what would not be acceptable behaviour?

I hope that we will get some more detailed answers to that but, be that as it may, personally I remain confident that the long-standing central sense of purpose and integrity of the BBC remains intact. There have been some recent problems. We may feel obliged to take some steps to buttress the BBC in the way that we have been discussing today, but we can still assume with some confidence that those qualities that have helped build the BBC as the great institution that it was and is still is today.

My Lords, I welcome the debate and thank the noble Lord, Lord Fowler, both for his speech introducing the debate and for his excellent chairmanship of the committee. He was absent abroad on one recent occasion and I had that onerous task. I have to say that, as a result, I am more appreciative of the work that he does. It is not easy. I am also grateful to him for dealing very fully with the report, allowing the rest of us to range a little wider than the report itself. I note that, with the exception of the noble Lord, I happen to be the only male Back-Bencher speaking in the debate. I do not believe that it has anything to do with football. My team went out last Saturday, so as a Scot I am of course less concerned about the result than the rest of you might be.

In a sense, we now have to move on. The charter has been agreed and set up. The chairman is there and, although we may have the process of selecting the next chairman within four years, it is likely that Sir Michael Lyons might be reappointed, so his chairmanship may extend to cover almost the whole of the charter period. It is therefore now our role to look at what exactly the chairman and the trust will do with the slightly limited powers that they now have. They obviously see themselves as regulators and as representatives of the licence fee payer. Like other members of the committee, I had reservations about the structure but, as I said, that is now in the past and it is time that we considered how this will work. In passing, I have reservations about the claim of the chairman and the trust to represent the licence fee payers. After all, licence fee payers are electors and constituents, so their real representatives in this matter are Members of Parliament, not an unelected trust.

What should the role of the chairman and the trust be? I believe that they should be the long-term strategic thinkers on the future of the BBC and the guardians of BBC standards. They should be regulators, not in the nit-picking way of regulating particular things but in considering whether the BBC is fulfilling the aims laid down for it in the charter.

As members of the committee might expect, I could spend a considerable time dealing with convergent technology and the role of the BBC in relation to it. I hope that the trust has already employed experts in convergent technology to give it advice on how broadcasting, or what I increasingly call “narrowcasting”, will look in 10 years and on how or even if the BBC can survive in this new world. It is very difficult to forecast the future when technology is changing so rapidly, but it must be the responsibility of the trust to try to make judgments and to ensure that the BBC has the capacity to adapt to change as it comes. So far, the BBC has been very good at this, but we must ensure that it continues to be so. We will move rapidly to a world where we will watch what we want to watch when and where we want to watch it. In this world, what will the role of a schedule-based broadcaster be? The BBC will have to become a programme producer rather than a schedule producer, but that is a role for the trust.

I shall address the rest of my remarks to the trust’s role as the protector of BBC standards. I hope that the BBC will for once accept criticism from someone who has been a very loyal supporter in my years on various media committees in both Houses of Parliament and who remains committed to the whole concept of a public service broadcaster such as the BBC.

At the heart of the BBC public service is a commitment to news. There is a growing concern both about how the news is presented and about its attitude to politics and politicians. That concern might be more widely felt on the government side than it is on other sides, but it should be appreciated by all. Everyone here believes that the BBC should never be threatened by political interference from any quarter. In return, however, politicians have a right to expect the BBC to fulfil its charter obligations to be educative, impartial and accurate in all that it does.

Let me give a small example of accuracy that has nothing to do with politics. It was given to me by my office companion, the noble Lord, Lord Haworth, of Fisherfield, who is a climber. The BBC has received awards for its “Mountain” series, in which Griff Rhys Jones was filmed climbing Ben Nevis and supposedly on the summit. Climbers, such as the noble Lord, Lord Haworth, and others, say that that is not the truth; he was not on the summit but two kilometres away and 129 metres lower down. It might not matter—the BBC has rather dismissed it—but if the BBC is careless with the truth in matters such as this, that gives rise to the question of trust in other things that it does.

I have three worries about news programmes on the BBC. First, they too often appear to lead with sensational news about individual cases rather than what I would consider to be the major news story of the day. It recently led the “Six O’Clock News” with about five minutes on the arrest of a suspected paedophile in, I think, Thailand. The third or fourth news item was the signing in Madrid of the new European treaty. Which is the most important? In my view, it is obviously the signing of the treaty.

Secondly, the BBC’s news coverage is too often negative. Very rarely is there any positive coverage about anything that politicians in particular and the Government do. This causes concern because, thirdly, whether we like it or not, the BBC is a vital part of the democratic structure of this country. It is the most trusted provider of news and views and is for many people the link between the electors and the elected. Elected representatives cannot meet all their constituents and discuss the issues of the day with them. That is simply a physical impossibility, as I know as a former MP. Their constituents therefore rely on the media, in particular the BBC, for the views and analysis of the issues of the day. It is therefore vital that the BBC is seen to be open, accountable and impartial in its reporting of politics and politicians. I therefore welcome the recent announcement by the trust that it has commissioned a review of the BBC news service, particularly in the nations and regions, with particular reference to impartiality. I must say in passing that the BBC is impartial; a large number of its correspondents sneer at all politicians, not simply at those of one particular party.

Let me make a few suggestions about what the trust should consider. First, it is important, as I have said, that the BBC and the rest of the media should be seen to be open and accountable. Members of the committee will know that I believe that the Freedom of Information Act should cover all aspects of the BBC, including the salaries, expenses and financial interests of those who report and give us the news. The BBC is, as I said, a vital part of the democratic structure. I fully supported the freedom of information legislation and believe that, if we are entitled to know about all other public bodies that are publicly funded, we are entitled to know about the BBC as well. It is very difficult for the BBC chairman and the trust to claim that they represent the licence fee payers when they are not prepared to tell them exactly how they spend their money.

Secondly, the chairman and the trust should carefully examine the way in which news and views are presented. Too many BBC newsreaders and presenters believe that hectoring politicians and giving them a hard time is their job. I do not believe that it is. Their task is to allow politicians and others of differing views to express themselves to the public in such a way as to give the public the opportunity to make up their own minds on different points of view. It may make good television or radio to have a self-opinionated, self-appointed guardian of what they see as the truth badgering a Minister or an opposition spokesman on the latest political story, but it does not educate the public.

Thirdly, and perhaps most important to the health of democracy, a culture of cynical contempt about politics and politicians pervades the BBC from the newsroom to almost all programmes. One of my favourite programmes is Michael Parkinson on a Sunday afternoon on the radio, mainly because he plays my sort of music. He has throwaway lines in which he shows his contempt for politicians. In that, he follows the example of people like John Humphrys and Jeremy Paxman. There are those in the media who understand this and deplore it. I believe that Jeremy Paxman has said that people such as him should always remember that the politicians whom they interview have been elected by the people of the country and that he has not. It is a pity that he does not often take his own advice. In his book, My Trade, Andrew Marr states that journalists and the media,

“have become too powerful, too much the interpreters, using our talents as communicators to crowd them”—

the politicians—

“out. On paper we mock them more than ever before and report them less than ever before. On television and radio we commentators are edging them out ever more carelessly. Democracy made modern British journalism”.

The problem often seems to be that too many journalists in the BBC and elsewhere do not appreciate that democracy and politics are inseparable. They may be the reverse sides of a coin, but they are part of the same coin. You cannot damage politics without to some extent damaging democracy as well. There has been much criticism of politicians in the media about declining turnouts in all elections. Of course, politicians bear some responsibility, but those journalists and media commentators who are so free with their attacks should perhaps look in the mirror every morning and every night and ask themselves how much they are to blame in creating an unjustified cynicism among the public about politics that means that they see little point in voting.

The BBC in particular has an important role to play in creating an educated electorate in the most mature democracy in the world. That may make its political coverage less interesting, but there are times when the BBC’s role as educator and its responsibilities within a civic society are more important than its role as an entertainer. I hope that the new chairman and the trust will look carefully at the part that the BBC must play in a modern democracy, not just to ensure that licence fee payers are satisfied, but also to ensure that the elected politicians on whom the BBC ultimately depends for its existence are not increasingly alienated from them, as many of them are at present.

My Lords, it is a great pleasure to take part in this debate and to lend my support to the chair and fellow members of the Communications Committee. It is daunting to follow my noble friend and say anything that is even remotely original. I probably should not say this, but I enormously enjoy being a member of the committee. From the outset, it is important to say that this inquiry, its conclusions and our comments on the issues which broadly can be described as “what is the chairman of the BBC for?”— which I agree with my noble friend Lady McIntosh we did not quite work out—and “how he was appointed and whether that process served the public interest” are not a reflection on the capability or appropriateness of Sir Michael Lyons, the person appointed. I came to this inquiry as a novice on the committee. Many members had been investigating this and other BBC matters for some time.

During the inquiry, some matters were of broader concern than simply whether the mechanism by which the chairman of the BBC was appointed was right or not. As my noble friend Lord Maxton said, the BBC is an institution of enormous national significance. Its independence, the quality and trustworthiness of its news and the balance of its comment are part of the weft and weave of British democracy. Any change or development in the way that the BBC does its work has to be tested against its position of national importance. That is why the change to its governance was a hotly debated matter and the appointment of its chair is worthy of at least comment by Parliament. All of us on the Communications Committee will be keeping a watching brief on how it works out.

In preparing this contribution, I read through the evidence and was struck by one or two things which merit comment, some of which has already been said. But in the honourable and noble tradition of this House, I intend to say them anyway. Like many other members of the committee, by the end of the inquiry I was still unclear as to who is now the champion of the BBC. Who is the person who will stand up and say, “Over my dead body”? For instance, the noble Lord, Lord Fowler, spoke about the top-slicing of the BBC’s funding. While the current chair was keen to assure us that he is the chairman of the BBC, the fact that the new charter refers to him as having an honorary title is borne out by the fact that he did not say, “Over my dead body” when the top-slicing was suggested, which I suspect other chairmen would have done.

It was also unclear to me who would win in a confrontation with the director-general should it ever happen, which is why I am keen on recommendation 12 and the need for clarity on the role of the chairman. It should be clear whose job it is to represent the BBC itself as distinct from the licence fee payer. I agree with earlier remarks that the trust seems to act as a regulator and that the director-general acted as the voice of the BBC in its recent troubles concerning “Blue Peter” and others programmes. That begs the question of how, under the new arrangements, the BBC would handle a Gilligan-type scandal. Would the whole management team resign should such a thing happen now or would no one resign because it is not clear where the responsibility rests?

That leads to the other question for the inquiry: why it is important to have a robust and transparent process for appointing the chairman of the BBC. Although the issues of transparency and accountability have been more than adequately covered by the chairman of our committee and others, I suggest that the process for appointment would be enhanced by the proposals set out in the report. While we were working on it, in my innocence I was surprised at how difficult it was to achieve clarity on the appointments procedure, even from members of my own Government, and although I was probably less exercised by the fact that the Secretary of State has a role in the appointments procedure because I think he should have such a role, what is important is that it is clear and on the record so that everyone knows what is going to happen.

I return to the effect that parliamentary scrutiny would have on this appointment. Greater scrutiny, as outlined by the noble Baroness, Lady Howe, would recognise the importance of appointing a person who is fully aware of the responsibility that the chairman of the BBC bears for the democratic health and fabric of our society, and indeed the importance of the BBC in the world. It may be that a more robust and accountable appointments process would have produced the same result in terms of the present incumbent, but how much stronger a position would he have been in and how much greater status would he have enjoyed had the process been more robust, accountable and transparent? Indeed, how much better would he have been able to fulfil the important job of being both the champion of the licence fee payer and of the BBC? That is why I urge the Minister to take heed of our report.

My Lords, this has been an excellent debate largely because it has been so clearly focused. I note that all the speakers apart from those winding up and the Minister are members of the committee. I congratulate them on the report, and in particular the chairman, the noble Lord, Lord Fowler, on his rather forensic introduction. Many noble Lords have pointed out that the BBC is a unique institution, and for this reason the position and the appointment of the chairman, or more accurately the chairman of the BBC Trust, deserves particular consideration. While the previous and the current chairmen have been of high calibre, it is clear that such an appointment cannot simply be left to government without debate.

The concise report of the committee sets out particular concerns about the process employed for the selection of the current chairman. Looking at it afresh, it is extraordinary to note the level of influence of Ministers as they have exercised it at each step of the appointment process. Moreover, as the noble Lord, Lord Fowler, pointed out, it was disappointing to note that obtaining information about the process clearly took considerable time and effort on the part of the committee. The role of Ministers is pivotal under the current procedure. Officials responsible to Ministers appoint the selection panel. I say that advisedly while looking carefully at the Government’s response—perhaps not Ministers, but certainly officials responsible to them. Ministers have the power to add to and subtract names from the shortlist. Ministers choose from a list of four names, not necessarily having to choose the candidate most highly recommended by the panel. Members on these Benches wholeheartedly agree with the committee that transparency in the process is vital and that any perception of political interference should be countered. We therefore welcome the recommendation that there should be a duty on the Secretary of State to appoint a selection panel of at least five members made up of a majority of non-political appointees and chaired by a non-political appointee who is not a civil servant.

However, I am pleased that the committee is in agreement with my honourable friend Don Foster MP, when he said in his evidence that parliamentary scrutiny and oversight of the process is important. The committee’s recommendation that the composition of the panel should be announced to Parliament in a Written Ministerial Statement can hardly be objected to by the Government. Surely that is entirely in line with the Prime Minister’s plans for the Executive to become more responsive to Parliament, as he set out in his Statement of 3 July 2007 accompanying the Green Paper, The Governance of Britain. He stated specifically that the Government should surrender certain powers, including the power to make key public appointments without effective scrutiny. That is a clear statement, but I have read what the Government said in their very disappointing response to the committee’s report. They seem to be saying that the post of chairman of the BBC Trust is not a key public appointment. If that were put to an opinion poll, I think the general public would regard the chairman of the BBC Trust as being one of the central public appointments. So the Statement made by the Prime Minister is extremely important. Similarly, I agree with the committee’s recommendation that the adding to or subtracting of names from the shortlist by a Minister should be made public and, finally, that the panel should recommend only one name to the Minister, being the candidate who scored highest at interview, though of course Ministers will still retain the power to reject the name and ask the panel to reconsider.

I, like the committee, was surprised and concerned by the absence of the chairman of the BBC Trust in the list of key positions to be subject to a relevant parliamentary Select Committee which was set out in the Green Paper, The Governance of Britain published earlier this year, to which the Statement refers. Why is the key appointment of chairman of the public service broadcaster of our nation not included on that list? On what possible grounds can it be excluded? If the Prime Minister wishes to see greater parliamentary involvement, including pre-appointment hearings, then surely this is a clear omission from the list.

Not only is the process of appointment of concern to the committee, but also the lack of clarity in the role of the chairman, as has been mentioned by many noble Lords today. Previously the independence of the BBC from government was safeguarded as a team effort by the chairman of the governors, together with the director-general. The committee heard evidence to this effect from the former chairman, Gavyn Davies.

The chairman now has regulatory responsibilities and has a specific remit to represent the interests of licence fee payers. The Select Committee on the BBC Charter Review rightly raised concern over potential confusion. Of course, in a sense, the Communications Committee is very much the successor of the BBC Charter Review Committee and shares the chairmanship of the noble Lord, Lord Fowler. But the Government have failed to address these concerns, as a number of noble Lords have pointed out. Now the committee has reiterated the need for clarification as to whose job it is to represent the BBC itself as distinct from the licence fee payer. I wonder also as to the impact on the BBC’s long-term independence from government of the new structure.

In the recent faked phone-in scandal and the inaccurate trailer about the documentary “The Queen”, the chairman and the BBC Trust acted as regulator. I agree with the committee that the question arises, with this role being taken by the trust, whether it is consistent that it should be management, headed by the director-general, that is responsible, as the trust puts it, for,

“ensuring the culture of the BBC properly reflects the requirements of a public institution”,

with the trust representing the interests of the licence fee payer.

There seems to be confusion here. I raised concerns when we debated these issues in December 2005 and June 2006 about the role to be taken by the trust in the different elements. I pointed out then that there were three different areas that needed addressing—regulation, governance and management roles. I do not think we have yet teased out a satisfactory way of dealing with those three areas. We can now see in practice the downside of having the chairman of the trust involved in regulation. It would be gratifying if the Government had the courage to acknowledge the deficits in the present arrangements and to rethink them.

A further matter considered by the committee is that of the conditions of service of the chairman. My honourable friend Don Foster made the point in giving evidence to the committee that it is staggering that there is no written confidentiality clause governing the position when a chairman resigns. It is not good enough that the BBC obtained written assurances from Michael Grade on his departure. The position should be clear from the outset. It is certainly no reflection on Michael Grade. I support the committee’s recommendation that the chairman of the trust should be subject to a six months’ notice period and in the interim the non-compete clause in the trust code of practice should be amended so that the chairman cannot take up a position with a competitor for at least six months.

I referred to the Government’s response to the committee’s report. In looking through it, I tried to find a ray of sunshine. The noble Lord, Lord Fowler, was extremely gracious in picking out the one element of it that was of any benefit at all to posterity. It seems to be a stonewalling exercise. It is as though none of the committee’s recommendations was invented here—that is, within the DCMS—and therefore found absolutely no favour with Ministers at all. I recommend that the Minister and his colleagues look again at the committee’s report. I have rarely seen a more negative and stonewalling response and I hope that they will act eventually on the recommendations made by the committee.

It will be up to others in this House and elsewhere to keep up the pressure on the Government to make them rethink. It is crucial to get it right and to learn from experience. This is an extremely experienced committee and it has not made frivolous recommendations. It is crucial that we ensure the BBC’s independence and that it retains public confidence and respect. I believe these recommendations will go a long way towards securing that.

My Lords, like all other speakers this evening, I thank my noble friend Lord Fowler for moving this Motion and for his excellent work in chairing the Communications Committee for some years. I thank also the members of the committee for the hard work that has gone into producing their report, which we on these Benches broadly welcome.

Like the noble Lord, Lord Maxton, I shall divert slightly from the subject and say that I approve of what he said about the announcement of a review of the news services, which, in the BBC, too often major on the trivial.

The BBC is one of the great British public services, as we all know, and scrutiny of how it is led is thus of considerable importance to all of us. It is not just because of its history as the gold standard of British broadcasting that it can make claims of importance to this House; it is also because it is the recipient of huge amounts of public funds. A number of noble Lords have already mentioned the figure of £3 billion, which is an enormous amount of money. It is therefore extremely important that we can be assured that the BBC is being led apolitically, with clarity of purpose and a commitment to safeguarding the standards that the public have come to expect. We must be able to have confidence in the BBC.

I am afraid that this confidence has recently been shaken, as has been mentioned by other noble Lords. The recent revelations of fake phone-ins have meant that the public are likely to have doubts regarding the BBC, as well as other channels. They have certainly damaged the corporation’s reputation as the gold standard in public service broadcasting. On 9 July, the BBC was fined £50,000 by Ofcom following a revelation concerning a faked competition on “Blue Peter”. On 18 July, following the aforesaid exposure of industry-wide fakery, the BBC revealed the details of six shows in which the public had been misled or deceived. The shows included “Children in Need” and “Comic Relief”. As has already been mentioned, the BBC was also forced to apologise after it showed misleading footage of the Queen to journalists in July. This is simply unacceptable. Does the Minister think that the new governance arrangements are robust enough to restore confidence and prevent future deceptions?

These revelations came to light while the Lords Communications Committee was sitting. The committee rightly notes that the actions taken by the BBC Trust during the faked phone-in scandal underline how much the role of the chairman has changed. As has been said earlier, the problem is that the chairman of the BBC Trust no longer stands shoulder to shoulder with the director-general, as his position now carries regulatory responsibilities and is much further removed from executive broadcasting decisions than that of his predecessor governors. According to Gavyn Davies, the former chairman of the BBC whom we have previously mentioned, this division may eventually threaten the independence of the BBC, which I am sure noble Lords on all Benches would wish to safeguard most ardently. The chairman and the director-general might not be able to stand together against government pressure at a time of crisis, such as in 2003. In this respect, the new executive configuration of the BBC has not yet been tested. It is vital that the BBC always makes decisions in the interest of the public and not of Ministers and the Government. What assurances can the Minister give that the current executive organisation of the BBC will allow for complete independence, especially if something as serious as the Hutton inquiry happens again?

I also draw particular attention to the committee’s criticism of the way in which BBC chairmen are appointed. Its concern focused on the lack of parliamentary oversight of the selection and appointment procedure, and it mentioned too much ministerial influence. The committee argued that during the recent appointment of Sir Michael Lyons, Ministers were given considerable influence over the selection process. It said:

“Ministers appointed the selection panel, Ministers were allowed to change the shortlist of candidates and ultimately Ministers were able to choose between four candidates who passed the interview process”.

This, of course, contributes further to the concern regarding lack of independence. As my noble friend mentioned, his committee argued that there is a democratic deficit in the management of the BBC. How does the Minister respond to this assessment?

The committee recommended that, while the Minister would still be answerable for appointments,

“an independent panel should suggest only one name to Ministers and that name should be the candidate who scored highest at the interview”.

That sounds logical to me. Can the Minister explain why this suggestion to ensure greater independence has been ignored by the Government? Our position on these Benches is that we want to ensure greater transparency, not only in the appointment of the new executives, but also in the way the BBC is run. Of course, we welcome the drive to make the BBC more efficient.

Noble Lords will remember that the BBC Trust issued a public statement setting out its new role as regulator, in which it said:

“The primary responsibility for ensuring the culture of the BBC properly reflects the requirements of a public institution … rests with the senior management team. We have underlined that and asked the Director-General … to review the management structure with a view to strengthening the BBC's editorial controls and compliance procedures”.

What happened when it became clear that editors and producers might have been contravening the regulatory code? Does the Minister think that the regulatory code itself could be flawed? As the broadcasting code was clearly breached during the summer, with the quiz shows and competitions, what action are the Government taking to strengthen it? If, as the BBC Trust has outlined above, the responsibility for compliance rests at the most senior levels, I would like to conclude by asking, can we trust the trust to do the right thing?

My Lords, I am grateful to all noble Lords who have contributed to this important debate, but particularly to the noble Lord, Lord Fowler, who chairs the committee and introduced the topic with his usual style—which is, of course, particularly difficult for the Minister responding to the debate because not only does he accurately identify the committee’s arguments and stress his own strong views on several points, but he anticipates what the Government’s reply might be. After all, the Government have given a reply to the Select Committee. So he identifies that and then demolishes it in part of his opening speech. Therefore, I find myself with most of the positions that I would have adopted already demolished by the noble Lord, Lord Fowler, as he has already indicated why he will disagree with pretty well everything that I am going to say.

Let me get to the heart of the matter. The debate provides an opportunity for noble Lords to range widely over BBC matters, but it is chiefly about the chairman and the governance arrangements for the BBC. The most significant point that emerges from nearly every speaker who addressed themselves to it—as the noble Lords, Lord Fowler, Lord Luke and Lord Clement-Jones, did—is the democratic deficit. It was contended that the BBC had a democratic deficit under its old governance arrangements. There was great concern about the way in which the BBC was responding to several significant political crises, and about problems with its reporting. The noble Baroness, Lady Howe, mentioned the Hutton report.

The new governance arrangements are there to address the issue of democratic deficit. The problem is that noble Lords are interpreting that the only solution to the democratic deficit is increased participation in Parliament either in the lower House or this House. However, after substantial consultation and three years’ work, debate and analysis on creating the arrangements for the BBC, the problems all along were that the public thought that the previous arrangements were complicated and difficult to understand. They were not trusted by the BBC's commercial rivals or widely understood by licence fee payers, but there was no call for the BBC to come under closer parliamentary control—quite the opposite.

Of course there is the issue of the licence fee payers—the vast majority of the British public—being concerned that the BBC should be robust but also responsive and that new arrangements were necessary. But not, except in Parliament, was it strongly articulated that the solution lay in greater parliamentary control and supervision. Why should that be? Because the public value the independence of the BBC. Noble Lords cannot easily argue for the role of Parliament to be enhanced without great anxieties being created about the independence of the BBC.

My Lords, the Minister is taking his argument extremely wide from the outset. We are talking about the appointment of the chairman of the BBC, and parliamentary oversight and scrutiny in relation to that, not some Aunt Sally of parliamentary interference in the BBC.

My Lords, I recognise that, but what has been proposed in the new arrangements is the separation of the trust from the executive of the BBC and the role of the chairman within that. Within that framework, there is a clear illustration of how the democratic deficit is meant to be overcome. The role of the trust and the chairman in particular is to represent the licence fee payer; to supervise the actions of the executive board of the BBC. If one wants an illustration, the BBC moved with some dispatch to deal with the problem of the broadcast involving Her Majesty the Queen. The trust is looking at the broader—

My Lords, will my noble friend answer a simple question? The chairman and the trust are to represent the licence fee payer, but representation would normally mean that they had been elected by licence fee payers. That is simply not the case, so they do not in that sense represent licence fee payers.

My Lords, one can use the concept of representation of interest on a different basis from a purely elected basis, although I recognise the purity of the elected basis in the broader issues of government: that goes without saying. However, my noble friend and, I hope, the House will recognise that, in order to meet the democratic deficit, the trust is there to hold the executive board responsible to the wider public—the licence fee payer. Its role in those terms is illustrated by the example that I was about to give. The executive moved with some dispatch to deal with the broadcast that was the offensive with regard to Her Majesty the Queen, and apologised for it. The trust is looking at the guidelines that may need to be put in place to ensure that such a deleterious result does not occur again. It is the trust’s role to ensure that the executive is able to respond to the broad guidelines which it lays down. The trust is working hard in these areas.

The trust has existed only for a matter of months. I accept the point made by the noble Lord, Lord Clement-Jones, that this debate is concerned largely with the chairmanship of the BBC. However, he will recognise that it has ranged widely and that there has been condemnation of the structure which has existed only for a short period. It ought to be given time to bed down. So far it has a good record in responding to the crises that have arisen. Within that framework, the Government are bound to differ with the committee, as they did through the whole debate on the charter—the noble Lord, Lord Fowler, played an important part in that regard through his chairmanship of the relevant committee—on the fundamental point of whether the democratic deficit can be solved through the adoption of a greater role for Parliament in relation to the BBC. The Government argue that that cannot be the solution because the public take the view that it is important that the BBC’s independence should be guaranteed through maintaining distance between it and Parliament. We had that debate when we discussed the charter and it underpins the debate about the chairmanship.

The chairmanship of the trust is not quite the same as the chairmanship of other public bodies because other public bodies can be subject potentially to parliamentary vetting. If the chairman of the BBC Trust became subject to parliamentary vetting, the independence issue would be brought sharply to the public’s attention and the Government’s judgment is that the public would not support that position. What the public do support, and what the committee should recognise, is that the process by which the chairman is appointed should be fully in accord with the guidelines and requirements of the Commissioner for Public Appointments. She endorsed the way in which the process had been carried out. I believe that my noble friend Lord Maxton suggested that the process should be open. However, there is a problem with appointments that have to be open and subject to freedom of information requirements. It is not as if it is easy to fill some public positions. The House will recall—this occurred only the other day—an appointment in the nuclear industry which has had to be readvertised several weeks later at many times the original salary. Such a difficult post in the public service is not easy to fill.

To make every aspect of applications for such a post as we are discussing open and, under the Freedom of Information Act, available for everybody to see in terms of who had applied, who had failed, what their qualifications were and perhaps even the judgments made on them, would be very deleterious for aspects of public appointments. It is not easy for us to suggest that these issues can be any more guaranteed than they are by the Commissioner for Public Appointments. I refer to her excellent record and that of her predecessor, the noble Baroness, Lady Fritchie, who is now a distinguished Member of this House. This role ensures that the process meets the public test of probity for public appointments.

I understand that members of the committee have a deep, abiding and significant commitment to the future of the BBC and a real appreciation of the role that it needs to fulfil. It should be recognised that, in their response, the Government have established consistency on the charter and on the debate on the charter. The public expect the BBC to have the necessary degree of independence from political institutions and from Parliament. Nevertheless, it must be answerable to the public. The way it did so under its old board and arrangements allowed, as was mentioned this evening, the happy advantage of the chairman and chief executive being able to stand side by side. But it was also the case that, in certain circumstances, the chairman and the chief executive stood side by side in somewhat indefensible circumstances. There is now a separation between the trust and the board of the BBC. The arrangements have admittedly worked for only a short period of time, but they have given a clear indication that it can address itself to the issues that arise.

I regret that I did not pay due regard to the generosity of the noble Lord, Lord Fowler, in mentioning the contribution of the Arabic service and in saying with regard to the appointment that although he and the committee would have preferred a six-month cooling-off period, the BBC and the Government have settled for three months as there were legal difficulties with going as far as six months. The committee has made a proposal, and the BBC and the Government in their response have sought to move some way to meeting the committee's position. However, there is a quite significant difference between the Government's and the committee's positions. All contributions this evening have therefore indicated that the Government's response is not as acceptable to the committee as it might have been, and I fully understand that. The noble Lord, Lord Fowler, put me on the spot regarding these issues within 10 minutes of the debate being entered into.

It ought to be recognised, however, that these issues have been argued about for a number of years now. The Government are clearly maintaining consistency in what they expect from the BBC and the BBC ought now to be given the chance to show how the new arrangements will work. There is nothing in the evidence of recent months which leads us to any other view than that the BBC will grow in strength from the arrangements that have been put in place or to lead us to think that we should express undue concern about the future of what we all agree is one of our most significant public institutions.

My Lords, this has been a good debate. It gave some evidence of the quality of the Communications Committee. I thank everyone who has taken part. The noble Baroness, Lady McIntosh, rightly underlined the curious position of the chairman of the BBC Trust and the complex position at the top of the BBC. The noble Baroness, Lady Howe, pointed to the unsatisfactory position of Michael Grade’s departure from the BBC and the whole appointments process. The noble Lord, Lord Maxton, with his substantial experience, set out his view of what the new trust should be doing and the standards that the BBC should be observing, particularly in news programmes. The noble Baroness, Lady Thornton, asked, among other questions, who was the champion of the BBC—a question that I do not think has been answered. She, like all other Members—and this is an important point—spoke from a supportive position the BBC and its importance in our national life.

From the Front Benches, my noble friend Lord Luke pointed out some of the serious errors that the BBC has made recently, but he also stressed its independence. The noble Lord, Lord Clement-Jones, rightly criticised the fact that Ministers and officials were closely involved in the selection process and he supported greater parliamentary involvement in the oversight of the BBC, including pre-appointment hearings. He described the Government’s response to our report as negative and stonewalling.

Then we came to the great old stonewaller himself, the noble Lord, Lord Davies. He predicted that I would disagree with him, and I certainly do. It is frankly a little fanciful to give an illustration of the difficulties of filling public appointments by trying to compare the nuclear appointment with appointment to the chairmanship of the BBC. There is a long queue around Portland Place of people who would like to do the latter job.

I, and I think the committee, profoundly disagree with the noble Lord’s well rehearsed point about the role of Parliament. No one is arguing, as the response says, for parliamentary control. However, we are arguing for parliamentary scrutiny. We are talking about £3 billion of licence fee money, which has been provided by the public. As the noble Lord, Lord Maxton, rightly said, the only legitimate representatives of the public in this respect are Members of Parliament—to a lesser extent those in this House, but Parliament generally. Decisions on the charter and the licence fee taken by the department and the BBC are open to all kinds of objections. The idea of public support of the Government—not just this Government—being a determinant factor here is slightly ludicrous.

I do not really think that it can be seriously argued that, whatever else, the BBC Trust is the answer to the democratic deficit. I do not see how that can even be put forward as an argument. It is not a democratic body; no one elects it. That comes back to the point that the noble Lord, Lord Maxton, and others have made on its democratic legitimacy. The BBC Trust is and can be a regulator, but I do not see how it can be asked to fill the democratic deficit that undoubtedly exists.

We have had our debate. I am grateful to the Minister. It will come as no surprise to him that we will want to come back to these issues and we will be debating and investigating new issues over the coming months.

On Question, Motion agreed to.

House adjourned at 9.18 pm.