My Lords, the Government announced in a Written Ministerial Statement on 16 September that there would be no increase in the licence fee on 1 April 2011. A decision about 2012-13 will be taken as part of the next funding settlement. Discussions on the next funding settlement will begin next year. The Government will take all relevant factors into account, such as the economic climate in the country, the views of the BBC and its competitors and, of course, public opinion. We remain committed to a strong and independent BBC that forms the cornerstone of public service broadcasting. The fundamental question of what the BBC should look like and the role that it will play in the longer term will be carefully addressed at the time of the next charter review.
My Lords, I thank my noble friend for that reply and very much welcome the last part of what she had to say. In view of her Answer, do the Government believe that the licence fee is the best way of financing the BBC and of securing its independence, and are they entirely and absolutely committed to its continuance?
My Lords, I am so pleased that my noble friend Lord Fowler has asked me this supplementary as the House knows that he is probably the most knowledgeable and experienced Peer on this subject. It is important to me and it gives me the chance to stress that the Government are fully committed to the principle of the licence fee as the primary method of funding the BBC. As the noble Lord will know more than most, with the development of technology and viewing habits we will need to keep this under review to make certain that current arrangements do not become outdated. The BBC continues to be the jewel in the crown in the UK’s media landscape and the licence fee is fundamental to supporting it.
I am sure that we all listened to the “Today” programme this morning on which this matter was discussed. I confirm that we have received a letter from a variety of media groups asking the Secretary of State for Business, Innovation and Skills to consider blocking any acquisition as regards BSkyB and News Corporation. However, it is premature to speculate as the parties have not yet announced the result.
Does my noble friend not agree that while it is important that the BBC is realistic about its new licence fee settlement, it is equally important that the settlement is not punitive, as this will damage not only the BBC but the independent sector which contributes so much to the creative industries in which the BBC invests to a considerable degree?
I thank my noble friend Lady Bonham-Carter for her points. How savings will be made is a matter for the BBC, but the chairman of the trust has asked the director-general to absorb the cuts without significantly reducing the quality of the service to licence-fee payers. Regarding competition, across the media landscape we want there to be scope for deregulation, new business models, sharpening competition and greater economic benefits.
Does the Minister share my view that the BBC licence represents possibly the best value for money in the country, given the BBC’s range of programmes and other activities—especially its consistent investment in all branches of the arts? I am sure that we have all lately enjoyed the proms again. Will she acknowledge that the range of programmes at the price at which the licence fee is set represents much better value than the rates charged by Sky for largely imported, second-rate programmes?
The noble Lord, Lord Corbett, strays into a slightly different area, but I agree with him that the BBC must demonstrate that it is operating efficiently and giving licence-fee payers value for money. The BBC should be prepared to defend all its expenditure decisions.
My Lords, are the Government aware that the BBC punches way beyond its weight in foreign policy, and that the BBC Persian service is regarded by Iranians as their best source of information and actually forms the best ally that the Government have in Iran? Any cuts might well undermine Britain’s influence there.
The noble Baroness makes a very good point and the BBC World Service is very special. It does not come under the same funding arrangements as the rest of the BBC because it is funded by the Foreign Office. I know that the Persian service is absolutely wonderful. The Cyrus Cylinder was presented by the British Museum and is now on show in Iran. The presentation was recorded on the BBC World Service. I thank the noble Baroness very much for that question.
I thank my noble friend for his question. The Government have reservations about the current governance structure and are considering the scope for change within the current charter framework. The governance structure was introduced in January 2007 when the charter came into full effect. The structure is intended to last for the duration of the charter—that is, until the end of 2016.
My Lords, is the Minister concerned that Sir Christopher Bland recently talked of the licence fee being used in a punitive and vindictive manner? What reassurances can she give that any decisions about its future will be free from political partisanship?