Question for Short Debate
To ask Her Majesty’s Government how they intend to ensure that a sustainable independent radio production sector is operating over the period to 2027, with particular reference to maintaining the quality of programming across the BBC and commercial services, and to ensuring appropriate skills and working conditions.
My Lords, I am grateful to the noble Baroness, Lady Grender, and the noble Lord, Lord Berkeley, for speaking in the debate. The noble Lord is a practising radio performer, I think one can call him, whose programmes I listen to regularly—an interest that I should declare. I am sure he has a lot to say from the other side of the microphone. We are a small but select group interested in the future of radio in this country and I look forward to all the contributions, including that of the Minister, as well as that of my previous apprentice and now fully fledged shadow Minister for DCMS, my noble friend Lord Griffiths of Burry Port.
In our debate on the Digital Economy Bill last year, discussed in an earlier debate today, I tabled an amendment on the future of the UK radio production sector. It attracted only one speaker apart from myself and the Minister, but unfortunately that speaker did not give his full-hearted support to the amendment, which was a bit of a downer. However, I am doing better today. We have double the numbers and I think I shall get a slightly better response.
If my amendment to the Digital Economy Bill had been accepted, it would have required the Secretary of State to report, within a year of the passing of the Act, on the impact of the BBC royal charter and agreement—particularly the agreement—on the balance between in-house and independent production of programmes for BBC radio broadcast; the extent to which the training and development of production staff may have been affected; the number of staff active in radio production compared to 2016, including details of gender and other indicators of diversity; and the impact that the changes had had on the salaries and conditions of radio production staff. These issues are still relevant today, although I now think we need to spend a little time reflecting on the changes that have been made in the intervening period.
My reason for raising the issue at the time was that we had learned at a very late stage in the discussions on the BBC royal charter renewal process that the BBC had decided to make significant changes to radio commissioning. Not only were changes going to be made, they would be incorporated into the BBC agreement. This decision deeply affects the health of the radio production sector in this country as radio production moves broadly from a system in which most programmes are produced in-house to a commissioning-driven model. That is why my original amendment called for a report to assess the implications of this decision for the wider UK radio production sector, because it certainly changed the terms of trade. It is important to recognise that we are not talking only about quality of output, although that is important, but an analysis of staff numbers, training, pay and conditions, gender and diversity, as set out in the original amendment.
Radio is a popular medium with a wide audience reach and we are well served by the present diverse mixture of national, regional and local stations, the mixture of public service broadcasting and commercial channels, and a wide variety of genres and styles. They make a terrific offering which many people enjoy. Of course, sound probably lay at the heart of our civilisation itself. It is an amazing experience to have pictures created in your brain by sound alone and a wide range of skills are needed to provide a proper system of radio production.
Sound is also used here, of course: our voices are amplified and taken from here by the use of a sound recording system. We could not enjoy concerts without it and there is obviously a question about how we would get on in safety situations if there were no proper system of communication through sound. So it is really important that we get a broader picture of this. It is therefore a bit ironic that radio, as part of the creative industries, does not get as much political attention as it should. That may be because it is not a major part of the UK’s creative industries; although it is very successful, it does not contribute to the bottom-line figures as much as film or television. However, it is part of our creative economy, so its health and future success should matter to the department, to Ministers, to Parliament and to the country.
There is a debate to be had on some future occasion—not now—about how and in what format Parliament should engage with the BBC charter renewal process. I give notice that at the appropriate time I will argue that Parliament is not as engaged as it should be in the process and we need to do something different in the future, particularly on the agreement, which is at the heart of how the contract between the Government and the BBC works in practice but is never discussed, mainly for lack of time. We focus on the charter, which is the very broad-brush stuff, but we ignore, at our peril, the detail in the agreement.
However, for the remainder of this speech I want to focus on two small asks that I am sure the Minister will want to consider very carefully and, I hope, respond to positively. I should like her to arrange a meeting for those who have been affected by the current changes in the BBC and in the wider radio community so that the department is properly briefed about what is happening on the ground—I worry that it is not. Secondly, the original idea of having a review immediately after the passing of the Digital Economy Act was, as I said, a little previous. I now have a suggestion that I hope the Minister will take up when the Government come to do their mid-term review of the operation of the BBC charter. We had previous assurances about it being a very limited, light-touch review, but I hope it will be appropriate for it to look at the particular issues raised in this debate. The review will be in about 2022, I gather; half way between now and the next renewal of the charter in 2027.
I should make clear before I proceed that my focus is on the public interest as it affects the whole radio production sector; it is not about the BBC. It is quite inappropriate for Ministers, or indeed the Opposition, to pontificate about what the BBC should or should not do: that is set out in the charter and agreement and we should leave them to get on with it. However, it is important that we recognise the impact that decisions will have on the wider community involved in radio production. In a helpful note for this debate, the BBC points out that before the current BBC charter and agreement commenced in 2017, the BBC guaranteed 10% of eligible BBC network radio hours to independent production and a further 10% was open to competition between the independents and in-house departments. In fact, the total available up to 2017 was about 9,000 competitive hours per year. Following the charter process and the new agreement, the BBC committed to opening up 60% of eligible hours to competition within six years. There are restrictions on that because BBC news output, BBC Weather, EBU broadcasts, BBC local radio and coverage of state occasions are not included in the eligible hours. Even so, this brings the eligibility for consideration for outsourcing to some 27,000 hours per year—an increase of a staggering 300%.
I accept that, as the BBC points out, this does not mean that everything put out to tender will be lost by the BBC and I respect the belief expressed by the BBC that the process will be what it describes as a robust, transparent and fair system of competition: they would, wouldn’t they? However, I put it to the Government that we do not know enough about the radio production industry at present to understand the impact that these changes will have and that this new policy will bring to bear on the sector. While it may be true, as the BBC asserts, that,
“the broadcasting ecology works best when we have in-house and independent production working in creative tension”,
I, for one, would like to see the evidence. The Government should ensure that it is presented in their mid-term review.
Total radio production in the UK is generated by a very small group of people. There are about 150 relatively small companies, spread right across the country. Do we actually know the numbers involved? Who is charged with collecting and reporting on this sector and where is the data published? There is clearly an issue about scale. The present group of independent radio production companies are surely not currently capable of operating, like the BBC, on a scale that would enable them to take over the huge increase in the proportion of radio that we are talking about. Add to that the fact that most staff are freelance and that some, but not a huge amount, of training is done outside the BBC and I think we have a perfect storm.
As we have heard in this House on many occasions, one of the problems facing the creative industries is that they are not structured in a way that encourages apprenticeships, and it is generally agreed that there are far too many unpaid interns. What is the current position and how will it change through this change in the BBC’s work? Given that more than 50% of programmes are likely to be commissioned from outside firms, for how long will the BBC be expected to continue to operate as a major trainer, perhaps the sole major trainer, in this area? Who is going to pick up the slack? Will the present voluntary levy system in the creative industries survive the apprenticeship levy? We can all agree that radio needs a flow of qualified people coming forward, but if the independent production companies are not able to do it and the BBC will not, who will take this on?
What will happen to current staff contracts, for those who are involved in the BBC and whose work is outsourced? Clearly, TUPE rules may well apply, in which case there will be quite a lot of constraints on the ability of existing independent companies to respond in a different way from what is currently the case for in-house commissioning. There are already concerns about gender balance in the radio sector, including on pay, as we have heard in recent weeks. Again, we lack the baseline data that would help assess the situation. It needs to go wider than just the BBC.
It is important to recognise that there is considerable disquiet across the industry about these changes. A long list of top BBC radio professionals and others had a letter published in the Sunday Times not so long ago, at the time the BBC was considering this decision, calling on the Government and the BBC to scale down proposals to outsource 60% of radio output. They said:
“As radio professionals, we are extremely worried about the proposal … to put 60% of BBC national radio output out to competitive tender. Over the past 20 years BBC Radio has gradually increased external commissioning from zero to around 20% … This gradual increase has fostered evolution while maintaining stability, allowing BBC Radio to sustain its international reputation for excellence. The proposal to increase competition to 60% … threatens severe damage to that excellence”.
At a subsequent public meeting, Gillian Reynolds, the distinguished radio critic, said that while the 20% of production that has gone out to independent companies has resulted in some excellent programmes, she saw no benefits in outsourcing 60%, or what she called the,
“Uberisation of the radio workforce”.
I take it as given that the BBC’s charter and framework agreement, in effect since January 2017, obliges it to open up 60% of “relevant broadcasting time” on BBC Radio to competitive tendering by 2022, with a review at that point. I have no problems with that: it is happening and we should watch it be taken forward. However, while the BBC has to do what it has to do, and we should not interfere, there is a public interest in ensuring the more general continuing success of the radio production sector. This change of practice at the BBC gives rise to serious concerns, centring on the sustainability of what is really a very fragile radio production market. The potential threat to smaller independent producers and to the BBC’s own in-house, world-leading production capacity has to be borne in mind. I look forward to the debate and to the Minister’s response to my two asks.
My Lords, with unerring accuracy the noble Lord, Lord Stevenson of Balmacara, has put his finger on a vital and current issue. Before I begin, I draw attention to my work as a broadcaster and composer, as stated in the register of interests.
Long before the advent of television, radio—as provided then exclusively by the BBC—carved out a niche in the public psyche that has never really gone away. Think of Churchill or Eden; think of the King. Indeed, given the way television is gradually morphing into something that will doubtless be unrecognisable to us in a few decades, radio may well be the long-term survivor. What is it about radio that makes it so special, if less high-profile than its visual partner?
At its best, it is very much to do with the imagination, as the noble Lord, Lord Stevenson, suggested. By not spelling out every detail, radio allows listeners—indeed, forces listeners—to use their imagination, to build pictures in the mind. I enjoy drama on television very much but I invariably find drama on radio more challenging and more satisfying. Radio, particularly local radio, is the great friend of the car driver—with information on where he or she is, what they can expect to find weather-wise, local events. That is very important, particularly in remote rural areas. Television, apart from short bulletins and the occasional magazine, cannot really devote the time to discussing local issues in the way that radio can and does.
Television has, in fact, been forced further and further down the one-way road of instant gratification. There is a terror that without quick editing the viewer will be bored, so we get faster and faster intercutting to hold the attention. Of course television can take us directly to world events as they unfold—the Twin Towers, Grenfell—and yet, does not a wonderfully scripted description, as we often hear on, say, “From Our Own Correspondent”, sometimes and somehow give us more human insight? What we get on television will be the same footage repeated over and over again until we almost feel we are becoming immune to the full horror of what is happening, whereas a radio correspondent will act as our witness and as our conscience, especially in the case of gifted reporters such as Fergal Keane, Kate Adie, George Alagiah and Robert Simpson, to name but a few.
I had the pleasure of working with the current director-general of the BBC, the noble Lord, Lord Hall, at the Royal Opera House. What he achieved at the ROH was a remarkable turnaround. I believe that what he is attempting to do at the BBC is equally ambitious and admirable—for example, rationalising salaries in management, cutting through excess middle management and opening up the BBC to fair competition from the independent sector, as we have just heard, although that in itself raises problems. This latter move is still in its infancy but it has been welcomed by the Radio Independents Group. However, between the ROH and the BBC there is a huge difference in size and scale. Turning round an ocean liner—which Broadcasting House indeed resembles—is one thing on the open sea but quite another if you are hemmed in on both sides as though instead of being on the ocean you are actually trying to turn a liner round on the Serpentine.
I love the BBC and have contributed to it in many ways since the early 1970s. Even then, we were trying to attract younger listeners—well, they are our listeners now. In the spirit with which the noble Lord, Lord Hall, invited constructive suggestions at the Select Committee yesterday, I am going to make some observations which I believe are central to securing a continuing and healthy radio sector. The gender pay issue and the size of well-known presenters’ salaries has rather masked a troubling state of affairs on the factory floor—the grass-roots. I am talking here in particular of local radio, which the BBC has done so much to set up, but which is now in pretty dire straits. Several factors have fed into this, but one is that there is absolutely no equality in terms of rates for the job. I am certainly not saying that a local radio breakfast host should get a comparable rate to a “Today” presenter—obviously not—but the disparity has grown out of all proportion. Instead of the possible £325,000 that a “Today” presenter might get, let alone what they have been getting, a local radio man or woman gets up at 4 o’clock in the morning and, with no assistance, entertains and informs his or her local community or county for, after tax, something like £76. I support the request made to the Minister by the noble Lord, Lord Stevenson, and I shall add another one. I would like to know whether local radio staff are working for figures above, near or even below the minimum wage when the hours are properly and fairly accounted for.
Let us move up the ladder and take very knowledgeable and skilled specialist presenters on BBC Radio 3 and BBC Radio 4, but not on “Today”. Why do they get a fraction of what, say, leading BBC 6 Music presenters get? Audience sizes are similar, as is profile. I realise that in a commercial world there has to be some element of hierarchy and that the BBC has to have the right to say that so-and-so is worth so much to it and to use some sort of yardstick, but that yardstick needs to be transparent so that Miss A can say, “Is my job not more or less identical to that of Mr or Mrs B?”. My suggestion is that the BBC may need, in this area, to jump the hurdle of network budgets in order to achieve greater visible equality across the board in terms of fees. I think the BBC might have some sympathy with this, or at least a version of it. I want to add that I am not speaking out of personal desire here. It is a matter of public record that when the controller and my editor at BBC Radio 3 pointed out that I was being paid more than my colleagues who did similar jobs, I volunteered to take a 33% pay cut to bring me more in line with them. That is a perfect example of what I would like to see more of, as long as the proceeds really do go to the underpaid.
Let me turn now to an issue that has caused huge distress and hardship. It is the handling by the BBC of HMRC’s IR35 directive, which the BBC has interpreted, lazily in my view, as meaning that virtually all freelancers must be put on PAYE. Except that is not the whole picture. The Revenue wants to cut down on abuses, as it sees it, involving PSCs—personal service companies—but the BBC could and should have fought for those people who are arguably not required to go on to PAYE. The Revenue took a sledgehammer to crack a nut here, and the fallout has contaminated people who are completely blameless.
Instead, by its own admission, the BBC not only dropped the ball, it simply did not see it coming. These executives are presumably on rather good salaries, and get pensions, perks and expenses. No such goodies were offered as compensation to presenters, many of whom had been forced by the BBC to set up personal service companies in the first place, often against their wishes and those of their accountants—not cheap. So while the BBC sorts out this mess, presenters do not actually have contracts at all, and furthermore, people have been required to pay tax in advance without knowing what they are going to earn. This is devastating for many people with mortgages and families, not to mention cases I have heard of women being denied maternity leave.
To sum up, the BBC has been overzealous in its interpretation of IR35 and CEST—“check employment status for tax”, which determines whether or not someone should be on PAYE. It saddens me to have to say that an organisation that is supposed to be expert at communication with the public has been so utterly disorganised and inept in that regard when dealing with its own employees.
The BBC appears to have paid HMRC up front without any idea of what will be owed and has applied IR35 to sole traders unnecessarily, forcing people into unacceptable contracts that tax them as staff, but with none of the benefits. All of this is a legacy of making people set up PSCs so that the BBC could avoid employer’s national insurance contributions. Can it be right that the BBC can simply disregard contractual obligations and, without consent, claw back tax from the past as well as the future? Many talented radio people are now questioning whether they can carry on working for the BBC. These matters really go right to the heart of this debate and the future of radio. I cannot help pointing out that under most BBC contracts, I could be sacked for saying what I have said and for criticising the BBC—but then again, I do not have a contract.
I end on a note of optimism. The BBC is like the NHS: it has myriad components that make it the impressive vehicle it unquestionably is. As a fine Culture Secretary in her day, I hope the noble Baroness, Lady Jowell, will not mind me taking an important point from her moving speech about illness and the NHS, and applying it to other large institutions such the BBC: we have to nurture the small specialist departments that contribute so much to making the body whole.
Of course, as with the NHS, money is the game-changer, but I believe that the BBC can be seen to be economising—it just has some of its priorities and methods horribly wrong. However, while it can give us programmes as diverse as “Test Match Special”, “Moneybox”, the “Shipping Forecast”, “Hear and Now”, “All in the Mind”, “Choral Evensong”, the “Proms”, “New Generation Artists”, “In Our Time”, “Open Book” and so many more, it will continue to hold a place of great affection and importance in the national psyche.
My Lords, I congratulate the noble Lord, Lord Stevenson of Balmacara, on securing the debate. He has championed broadcasting issues here in the Lords for longer than I have been in this place, and I look forward to hearing even more from him on this.
I also thank all those organisations that provided briefings for the debate. There is clearly strong interest in the progress of building a sustainable radio production sector for the future. It is important today that we continue to review whether or not the current arrangements will achieve just that. Indeed, as a member of the Artificial Intelligence Committee, I am only too aware of the significant changes we are facing in the media and almost every other walk of life. Some suggest that Al will bring us the next industrial revolution. Changes are coming, particularly to platforms for media, changes that will require vibrant, creative and innovative approaches to all forms of media production, including radio. Yes, great change is coming, but there is a constant too. Radio continues to reach 90% of adult audiences. Radio was condemned long ago. The advent of TV was thought to be its death knell. As eloquently described by the noble Lord, Lord Berkeley of Knighton, radio is woven into people’s lives. It is conversational rather than just informational. It establishes a unique one-to-one relationship with the listener. Radio has adapted well to new lifestyles through the use of apps, podcasts and access to Freeview. The BBC’s global news service, the World Service, is the most trusted news source in the world and reaches a quarter of a billion people every week, more than any other international broadcaster.
The background to this debate is all-important, as the noble Lord, Lord Stevenson, set out in his opening remarks: the new charter and what followed, the “compete or compare” speech by the noble Lord, Lord Hall, in 2014. On these packed Benches, we welcomed the opening up of competable radio hours—as many as 27,000 by the end of 2022, a minimum of 60%. We believe that external commissioning is a good way to grow a strong and creative independent production sector.
We also believe that, for this to work, the process has to be as described by the noble Lord, Lord Stevenson: a level playing field and transparent. However, we wonder whether it is a bit early in the process to assess progress. Although the BBC Radio “compete or compare” strategy was initially set in place in 2015, the BBC’s new radio commissioning framework started only in April 2017, and there have not been many commissioning rounds since. For example, there has not been a full Radio 4 commissioning round so it is early to assess the overall impact, as the Radio Independents Group explains in its briefing.
There are encouraging anecdotal signs from both the independent production side and commissioners at the BBC. The BBC believes that “compete or compare” opens up BBC Radio to the best creative ideas, in turn driving up standards and getting value for money. There is anecdotal evidence that commissioners believe that the process so far has raised the game. RIG has been encouraged by the new Radio 2 schedule changes that were put out to competition, and remains in regular dialogue with the BBC over any teething troubles regarding the overall strategy. I therefore support the call of the noble Lord, Lord Stevenson, for other discussions to take place—in particular, about whether in-house staff are having equal teething troubles.
RIG remains convinced that these changes will revitalise BBC radio production, both in-house and independent. If both the BBC and RIG are right and this heralds a transformative period for independent radio production, I wonder what the potential is for this open competition to increase in the commercial sector, which is sometimes a little more conservative about some of these things.
There are examples of where it has been working. For instance, companies such as Somethin’ Else and TBI Media work with stations such as Classic FM, Absolute Radio and Virgin Radio. Is there potentially a day when the radio industry could learn from the experience of Sky and BT, which have shared content in recognition of their need to compete in what is now a new world of streaming and YouTube?
Perhaps the BBC can lead the way, if the positive feedback so far proves accurate. As the noble Lord, Lord Stevenson, explained, this view is in sharp contrast to other reports. I refer in particular to the NUJ report, and look forward to hearing the Minister’s response to some of those concerns. I should like to hear the Minister’s view of the need for some kind of public value test for this process and what discussions have been held with the BBC Trust on that undertaking.
Fostering independent production in all parts of the country, rather than the current media centres, is also an important objective. We therefore hope that the new BBC Radio commissioning arrangements result in more opportunities for companies outside the normal media centres. Does the Minister believe that there is any scope for local radio to be included within eligible hours? I recognise that lack of finance and resource may be the main challenge to such an undertaking, but wonder whether the potential has been considered.
I hope that radio is not one of the casualties from an across-the-board percentage cut, when the BBC has to fund licences for the over-75s from this dodgy smash-and-grab policy that was imposed on the BBC. The budgets in radio are so much lower than those in TV that it could ill afford that kind of cut.
As one of our greatest global assets, the BBC should, and often does, lead the way, which is why the equal pay issue, raised by the noble Lord, Lord Berkeley, is such an outrage. As we saw yesterday, when Carrie Gracie gave evidence to the culture Select Committee, she is a women promised equal pay for equal work who has been treated badly—and she is not alone in that. Many other women sitting behind her, and many of the BBC women, now 200 strong, have similar stories. Indeed, there are other stories much beyond the 200 women who have signed up to this. The noble Lord, Lord Berkeley, is an example in having shown the way and taken the pay cut that he described. The issue has shamed the BBC, and the sooner that it puts this right the better. Until people know what different jobs are worth, and where they sit on salary bands, the culture of secrecy and an environment where unfairness can fester and breed will sadly continue.
While the deregulation issue was not in the wording of the debate, I would like to touch briefly on two areas. First, we in the Liberal Democrats remain convinced that we should retain existing local news requirements and commit to this principle being extended to DAB services in future, in line with the current rules for FM and AM. Seventy per cent of listeners say that they trust radio for national and local news. In a world of fake news, where President Trump can denounce the New York Times from Davos—a paper featured in the film “The Post” for publishing the Pentagon papers —the need to protect and preserve news has never been greater.
Secondly, we support greater freedom for radio stations to choose the music they want to play, to cater for their own listeners. Music consumption and distribution through streaming has moved on, and so should we. So we support the Government’s intention to reform in this area but ask them to examine with care what impact that may have on minority genres, such as the Asian Network.
Digital switchover is well overdue. The Communications Minister at the time, Ed Vaizey, said as far back as 2010 that 2015 remained the target. A commitment was made to lead in the drive to overcome the remaining barriers to switchover. While it is also true that he wanted to wait for the listeners to move, surely we are now close enough to 50% to simply get on with it. If we want to encourage this sector, we need to ensure they are not being charged to be on two radio bands rather than one.
If the future of radio is to be secured, I hope that the meeting next week with the DCMS and the industry will go well when they discuss the new contestable fund for public sector broadcasting. As the Minister is aware, my noble friend Lady Benjamin successfully campaigned for greater funding for children’s content, particularly on TV. Children’s TV has needed this boost for some time but, at the same time, it was noted that it might be possible to use some of this fund for radio. We hope that that is the case, if relevant to children. We also hope that additional funding above the £60 million is found, if that is applied to radio, for adults. We look forward to hearing reports of those discussions.
Radio in the UK is a great asset. We need to keep it that way and ensure that future generations continue to use this wonderful medium.
My Lords, I am delighted to add my voice to those taking part in this debate. I have come to feel like Tweedledum to the Tweedledee of my noble friend Lord Stevenson over the time I have been standing in this position, although his description of me as fully fledged is not one I am ready to accept. I feel half way between fully fledged and half-baked. I hope that, at least on good days, I am getting there.
I welcome the concentration on radio that this debate opens up for us. Perhaps I should begin by declaring my interests, as well as a little of my experience. I have been a contributor to BBC radio for over 30 years, mainly, but not entirely, to its religious output. I have worked with in-house production teams over that time, many members of which have since grown wings and are now occupying very senior positions in the corporation and other bodies. I sat alongside Brian Redhead, of beloved memory, and John Humphrys, James Naughtie, Sue MacGregor and others, in a 17-year stint with my “Thought for the Day”. I still do the “Daily Service” and “Prayer for the Day”, and, with BBC Radio Wales, “Weekend Word”. I can testify to the skills and experience, and the innovative and creative energy, of the teams that present these programmes. The plans and proposals we are discussing today should never be at the expense of the expertise gathered and honed in those production teams. However, these teams should, of course, constantly be kept on their toes by the knowledge that, even in religion, they do not operate by divine right.
Because of my decision to take the Labour Whip when I entered your Lordships’ House in 2004, I was obliged to drop out of the number of those doing “Thought for the Day”—par for the course. Another opportunity soon opened up. For the last four or five years, I have been offering my “Pause for Thought” on the “Chris Evans Breakfast Show” on BBC Radio 2. I assure noble Lords that moving from Radio 4 to Radio 2 was like moving from Neptune to Mars, but I have come to love the bustle and the culture of my new habitat very much. “Pause for Thought” is one of the strands won by an independent company in competition with the BBC. Its quality control mechanisms are good, and I am kept up to the mark by two levels of production scrutiny. Once again, the company is only too aware that its licence will need to be reviewed from time to time and that a renewal will depend entirely on the quality of its output.
Finally, I have been a long-time contributor to the output of Premier Christian Radio. For 10 years I co-presented a programme called “Taking the Tablet”, a half-hour show in which an Anglican priest, a woman, interviewed me, a Methodist minister, about three stories chosen from the Roman Catholic weekly newspaper, The Tablet. My association with the station has intensified of late, and in four days’ time I shall attend my first meeting as a trustee of Premier, where I will be meeting the issues and themes of this debate head on. The station operates in a fiercely competitive marketplace and, apart from the usual ways of funding such independent bodies, is greatly supported by private subscription. All this is by way of declaring my interests in this matter.
I would like to address the question of training, raised by my noble friend Lord Stevenson. If the independent sector is to take up even half the openings that are declared available between now and 2022, it will be increasingly necessary to ensure that the work its wins will be done by properly trained personnel. The question of payment for people involved in the commercial sector needs to be addressed; so many people are freelance, volunteers or interns, and it is necessary to monitor that.
A helpful briefing from RIG, the Radio Independents Group—I think that if I were the Radio Independents Group I would choose a more fortunate acronym—gives a snapshot of where we are now on the issue of training. It indicates that its members are involved in training “the next generation” of producers, and claims to have so far provided over 2,000 learner days, comprising over 1,100 individual learners and including a diversity mentoring scheme. It states that:
“Around 60% of learners have been women and around 15% BAME and 5% disabled”.
This is, of course, to be welcomed. But someone needs to monitor the figures as the great leap forward scheduled over the next three or four years takes place.
Is anyone doing the bespoke work previously undertaken by the Radio Authority? One feels that Ofcom treats radio as a Cinderella and gives it only marginal attention; the Radio Authority, of course, existed with the sole purpose of looking at the quality of radio. Quis custodiet ipsos custodes? A bit of Latin—who will regulate the regulator? It seems to be a relevant question as we move into the different situations that face us.
Of course, the commercial sector is driven largely by finance. No problems there—expect that when difficult decisions about expenditure have to be taken, there will always be a temptation to make economies in areas that tend to be more costly. The results of the recent consultation on these matters recognised how, in the event of greater deregulation, the relatively expensive news service currently required of them may well be diminished or even abandoned. Yet local news, traffic conditions, weather and events would seem, for the most part, to be an essential ingredient in the output of any commercial broadcasting company anxious to give its audience what it most wants.
Indeed, once listeners are thought of merely as customers—and then, en masse, commodified—radio itself loses out on what it is, at the end of the day, all about, for radio is the most intimate medium of communication available to us. Whereas the BBC blazons its vocation at Broadcasting House as helping nation to “speak peace unto nation”, the actual activity is more about speaking peace to individuals in the privacy and intimacy of their own space. Certainly, that is how I was taught to do it; I always feel that I am talking to someone in their car, or in their bed, or at breakfast, or taking the children to school. It feels such a personal medium as a result of that way of looking at it.
Great care should be exercised to ensure that greater freedoms do not lead to lesser quality of output. The overarching responsibility for the commercial sector taking up its new opportunities must have the effect of:
“Holding the BBC to account for the delivery of its mission and public purposes”.
Good regulation should make this a priority. The National Union of Journalists is concerned that a proper review has not yet been carried out of the likely impact of the proposal to boost the number of hours available to independent companies to bid for production previously held within the BBC to see what damage it might do, both to the commercial sector and the BBC. The NUJ suggested that it might cost the BBC up to £1 million without the BBC benefiting from it at all. It is worth at least thinking through.
I have one further matter to bring forward. The commercial sector consists, so we are told, of about 150 companies. The self-styled “trade body” for two-thirds of these SMEs is the Radio Independent Group, which I have already mentioned. The bulk of commercial radio stations seems to have been consolidated within two large companies: Global and Bauer. No doubt this achieves critical mass for negotiating contracts, offering infrastructural support, sharing experience and ensuring solidarity in what can be a difficult commercial environment.
My concern is that the way these chips fall might well militate against the entry of smaller, innovative, aspirational newcomers. In the overorganisation of the commercial sector into large blocs, we must also throw in Arqiva, which is responsible for pretty much all of the transmission. We should be very careful about keeping space and offering opportunity to newcomers who may start in a very small way but might become something of great interest later on. There must be scope for bright new things as well as seasoned and organised veterans in the bidding process, which will increase in pace as that 60% of BBC output becomes open to others.
So I am delighted that, even at the fag end of an exhausting week, we can give our attention to the present and future needs of radio, and I hope the Minister can give us, with a little élan and freedom to anticipate the weekend, some firm assurances on the questions that we have asked.
My Lords, this has been an interesting but short debate. The noble Lord, Lord Stevenson, told me that he was going to step back, do much less and spend more time at home. All I can say is that I have seen him on either the Front Bench or the one behind more than ever before. I am not quite sure what “taking more time” actually means. I thank him for bringing forward this debate on independent radio production, and all those who contributed.
The independent radio production sector is a growing and exciting industry. Many of us will be familiar with its offerings, particularly on BBC Radio, with programmes such as “Diplo and Friends” on Radio 1, and two of my favourites, “Sounds of the 60s” on Radio 2 and “Gardeners’ Question Time” on Radio 4, which I am afraid slightly shows my age. With the high quality of programmes provided by the independent radio production sector, it is important that those within the industry are supported to grow their businesses and to secure commissions for programming, as the noble Lord, Lord Stevenson, mentioned.
In June 2015, the BBC reached an agreement with the Radio Independents Group, known as RIG—I agree with the noble Lord, Lord Griffiths, that it is a slightly unfortunate name for the trade body for the sector—which sought more opportunities to pitch its independent radio production ideas to the BBC. This agreement was then written into the BBC framework agreement and provides a level playing field for independent and in-house producers.
RIG represents the independent radio/audio production sector in the UK, which comprises around 150 companies. This agreement established that the BBC will move from the limited quota-based arrangements to a new commissioning structure, which subsequently opens up 60% of eligible hours—all radio hours except for news and current affairs—to competition by 2022. Prior to this, independent radio producers were able to pitch ideas for only around 20% of BBC programmes, which meant there were relatively few opportunities to offer new ideas for many parts of the BBC’s schedule.
Although the Government are not party to this agreement, we continue to support this change. The agreement from 2015 provides many more new opportunities to the growing independent radio production sector. This sector has a track record of producing high-quality content and gives BBC Radio audiences access to the best ideas and productions available.
However, I emphasise that increasing the competition between independent and in-house productions does not automatically guarantee that the independent sector will receive more commissions. Both independents and BBC in-house will be eligible to bid for work and the best ideas will win commissions. There will still in effect be an in-house guarantee, consisting of 40% of all programmes, reflecting the BBC’s continuing importance to radio.
As far as the timetable is concerned, the new BBC charter sets a firm timescale for the implementation of this change. The timescale for the transition by 2022 was set by the agreement between the BBC and RIG. Following on from that, since 2015 the independent radio production sector has remained strong and continues to thrive.
The noble Lord, Lord Griffiths of Burry Port, talked about quality. With the possibility of more independent radio productions being commissioned by the BBC, we expect that the high quality of programmes should be maintained or even increased by offering a wider choice of programmes to licence-fee payers.
The changes to BBC Radio continue to take place within a broader strategy called “compete and compare,” as mentioned by the noble Baroness, Lady Grender. It aims to extend competition, where it works, across the BBC’s output and, where this is not appropriate, to make greater use of comparisons with best practice in the market to ensure that we are given universal access to great quality content. I am pleased to be able to share an update from the BBC on the progress that this strategy has made. As of January 2018, 70% of “compete and compare” hours have already been awarded, with a further 6% to be awarded by March 2018. That means that in the first full year of “compete and compare”, BBC Radio will have put up 23% of eligible hours for tender, which equates to around 10,800 hours of content. So far, there has been a marginal shift of hours from BBC in-house production to indies totalling 89 hours, and competition is working with commission going in both directions.
I acknowledge that there may be concerns about the possible implications for BBC staff, such as possible job losses. These changes are being introduced with a long transition, and both the BBC and RIG are taking steps to ensure that the transition is as smooth as possible. As of now, no BBC in-house redundancies have resulted through the “compete and compare” strategy.
The noble Lords, Lord Griffiths of Burry Port and Lord Stevenson, talked about skills, training and contracts. The independent radio production sector strives to support all its members and advocates skills training, adequate employment conditions and the training of new entrants into the sector. As part of its remit, RIG offers advice, resources and training to its members to ensure that all those working in the sector have the essential skills required and can access further development opportunities as their careers progress.
The noble Lord, Lord Berkeley of Knighton, talked about wages. Independent production companies contracted by the BBC are obliged to comply with all legal requirements and the BBC’s living wage policy, with many firms employing a standing staff with the rest employed on freelance rates set by the market.
The noble Lord, Lord Stevenson, mentioned diversity and training. Independent radio producers are heavily involved in training the next generation of producers. Through the RIG training programme, they have so far provided 1,959 learning days involving 1,089 individual learners, including a diversity mentoring scheme. Around 60% of learners have been women, around 15% BAME and 5% disabled—I hope that last statistic will rise—showing the industry’s commitment to promoting diversity within the workforce.
Noble Lords raised several points, which I hope I can answer. The noble Baroness, Lady Grender, raised a couple of points that I will have to write about because the inspiration that normally appears over my left shoulder was not here until five minutes ago, so I probably did not pick up everything. Inspiration is appearing now, though.
The noble Lord, Lord Stevenson, mentioned a meeting, and we are of course more than willing to ensure that that happens. Perhaps we can talk about how we can go ahead with that. Several noble Lords, including the noble Lord, Lord Stevenson, mentioned a report and a review. The Government do not plan to produce a report on the BBC’s new strategy but, as I think several noble Lords mentioned, we have the opportunity to review this at the mid-term review of the BBC charter. That is when many concerns raised today by noble Lords can probably be discussed further.
The noble Lord, Lord Berkeley, talked about HMRC. The original IR35 or intermediaries legislation was introduced in 2000 but the legislation has now been changed regarding the engagement of individuals through personal service companies for all public sector bodies. There are two main areas of change. First, it is now the BBC’s obligation as a public body to deduct the right amount of tax and NIC for all those whom it engages. To do so, it must assess individuals’ employment status. Secondly, the employment test that we previously used to indicate employment status has been replaced by a new one-size-fits-all test called the CES tool, designed by HMRC, which is intended to apply to all industries. This is being used to assess the status of all on-air contributor engagement, new and current, which extend beyond 6 April 2017. The CES tool provides HMRC’s view of the employment status of a worker; if the outcome of the new tool deems the engagement to be one of employment, we will deduct the appropriate tax via PAYE and NIC at the point of payment.
The noble Baroness, Lady Grender, talked about digital. We are making steady progress towards reaching 50% of listings on digital platforms and the radio industry expects this figure to be reached in 2018. Decisions on future switchover are not simple or straightforward. It is important for the Government, the BBC, commercial radio and other stakeholders to take time and care in how we approach any decisions. A review by government, following the reaching of 50%, will need to carefully consider the key factors that will need to be in place, including issues in relation to cars, DAB coverage for all those parts of the country without digital services and the potential timing and approach to switchover. The noble Baroness also talked about extra funding. I do not know if she was thinking about the contestable fund.
My understanding is that there is a meeting at DCMS next week. It sounds like an excellent idea; it is about whether some of the contestable funding is available for radio. As the noble Baroness will be aware, that is something that was hard fought for. The £60 million is going towards children’s TV content and maybe some radio, but we would like to know that it will still be directed towards children’s content, even if some is allocated to radio. If it becomes adult radio, we would ask for there to be additional funding to the £60 million.
The noble Baroness is right; that is for children’s television. In fact, we want to engage with the radio industry to explore whether there might be alternative options, so as to use a small proportion of the funding marked for the contestable fund to support the radio sector in a more bespoke way, but that would not take away anything from children’s programmes.
I have now been inundated with papers, including on public value tests, which I thought I would have to write to the noble Baroness about. No review is planned, but we are confident that the compare or compete strategy is working. We have the power to review this midway through the charter, should there be any worries. When the BBC wishes to launch a new service, Ofcom may have a role in asking about its public value and the market impact that it may have. It equally may apply when the BBC wants a major change to how it provides its services. I may well not have answered all the questions. I apologise to noble Lords but I will certainly write if I have not.
To conclude today’s debate, independent radio production remains a strong industry and the agreement made between RIG and the BBC will ensure that the best programming is made available to BBC radio listeners. I look forward to the new and exciting programming that the independent radio production sector will continue to offer in the future. Like the noble Lord, Lord Berkeley of Knighton, I, too, am looking forward to listening to the radio on my long journey home tonight.
House adjourned at 4.49 pm.