BBC

Committee's Report

• In its report on the BBCs Annual Report MPs criticise the then government for seeking to bounce the BBC into accepting a deal that exposed it to funding free TV licences for all those over 75 beyond 2020.
• BBC Director-General Tony Hall is also criticised for his handling of negotiations, particularly in failing to seek the formal agreement of the Executive Board before recommending to the BBC Trust the deal struck with the Government.

Chair's comment

• DCMS Committee Chair Damian Collins MP said: This is an invidious position for the BBC to put itself in.
• Detailed minutes which would have shone a light on the crucial decision making process are absent or incomplete which is a matter of great regret.
• The BBC and the Government much reach an agreement to allow the funding of free licence fees for the over 75s to continue after 2020.
• The BBC finds itself here as the result of a deal done behind closed doors that allowed no transparency for licence fee payers.
• We hope that the new Unitary Board will ensure more transparency on important decisions made by the BBC in the future.

The Report finds:

• The next round of negotiations between the Government and the BBC, due to take place in 2021, should agree a funding formula that maintained the free over 75s licence fees.
  • Recommendation:The Government should set out proposals for how it can support this measure in the future, alongside the commitment that has been made by the BBC
• In July, senior BBC executives told the Committee continuing to fund licences for all over 75s would require “unprecedented closures of services”, including BBC Two, the BBC News Channel, and Radio 5live. MPs note this was radically different to what the BBC had said in 2015 and in advice given by the Director-General to the BBC Trust board. When Lord Hall was pressed by Committee members about reassurances he had given to the Trust in 2015 about the BBC's finances, he said minutes of the meeting were "inadequate".  MPs suggest it was possible that the BBC never intended to fully fund the over 75s licences beyond 2020, but “unsurprisingly this is not reflected in the minutes of their meetings at the time of the negotiations”.
  • Recommendation: Government and the BBC should set out what steps they are taking to ensure the 2021 licence fee negotiations are conducted in a wholly different way with a sensible timescale allowing parliamentary oversight and involvement of licence fee payers
• It welcomed the introduction of gender pay splits to aid transparency about salaries and highlight differences between how men and women are paid within a given job pay range.
  • Recommendation:We expect the BBC to include an update on the impact of this change in its next annual report, and to take further, timely action on fair pay in the wake of damage to its reputation as a result of the findings in our 2018 inquiry
• MPs welcomed the BBC accepting responsibility for meeting the liabilities for contractors who faced large tax bills as a consequence of working through Personal Service Companies. However the Committee remained concerned that the issue was one of many with roots lying in poor management, leadership and governance at the BBC.
  • Recommendation:We expect the broadcaster to ensure that the earmarked funds are used to support those presenters who told us they were facing "life-changing" liabilities as a priority, rather than higher paid presenters who are likely to be more able to manage uncertainty in future income.
  • BBC administering welfare benefits: The Report finds potentially far-reaching unintended consequences arising from the licence fee decision with the absurd situation of the BBC being pushed into decisions that individuals make about their uptake of welfare payments.
  • However, the BBC must now execute the policy for which it took on responsibility.
  • The Report found the impression given by the BBC in evidence before the Committee that it had reluctantly taken on responsibility for the policy at odds with correspondence from 2015 that indicated this was a responsibility it had requested.
  • BBC Equal Pay: The Report notes some evidence that the BBC is continuing to take steps to resolve equal pay issues set out by the DCMS Committee 2018 report but flags there was still a long way to go.
  • Public Service Companies: A full list of recommendations can be found in the report.

Further information

Committee's Report

• In its report on the BBCs Annual Report MPs criticise the then government for seeking to bounce the BBC into accepting a deal that exposed it to funding free TV licences for all those over 75 beyond 2020.
• BBC Director-General Tony Hall is also criticised for his handling of negotiations, particularly in failing to seek the formal agreement of the Executive Board before recommending to the BBC Trust the deal struck with the Government.

Chair's comment

• DCMS Committee Chair Damian Collins MP said: This is an invidious position for the BBC to put itself in.
• Detailed minutes which would have shone a light on the crucial decision making process are absent or incomplete which is a matter of great regret.
• The BBC and the Government much reach an agreement to allow the funding of free licence fees for the over 75s to continue after 2020.
• The BBC finds itself here as the result of a deal done behind closed doors that allowed no transparency for licence fee payers.
• We hope that the new Unitary Board will ensure more transparency on important decisions made by the BBC in the future.

The Report finds:

• The next round of negotiations between the Government and the BBC, due to take place in 2021, should agree a funding formula that maintained the free over 75s licence fees.
  • Recommendation:The Government should set out proposals for how it can support this measure in the future, alongside the commitment that has been made by the BBC
• In July, senior BBC executives told the Committee continuing to fund licences for all over 75s would require “unprecedented closures of services”, including BBC Two, the BBC News Channel, and Radio 5live. MPs note this was radically different to what the BBC had said in 2015 and in advice given by the Director-General to the BBC Trust board. When Lord Hall was pressed by Committee members about reassurances he had given to the Trust in 2015 about the BBC's finances, he said minutes of the meeting were "inadequate".  MPs suggest it was possible that the BBC never intended to fully fund the over 75s licences beyond 2020, but “unsurprisingly this is not reflected in the minutes of their meetings at the time of the negotiations”.
  • Recommendation: Government and the BBC should set out what steps they are taking to ensure the 2021 licence fee negotiations are conducted in a wholly different way with a sensible timescale allowing parliamentary oversight and involvement of licence fee payers
• It welcomed the introduction of gender pay splits to aid transparency about salaries and highlight differences between how men and women are paid within a given job pay range.
  • Recommendation:We expect the BBC to include an update on the impact of this change in its next annual report, and to take further, timely action on fair pay in the wake of damage to its reputation as a result of the findings in our 2018 inquiry
• MPs welcomed the BBC accepting responsibility for meeting the liabilities for contractors who faced large tax bills as a consequence of working through Personal Service Companies. However the Committee remained concerned that the issue was one of many with roots lying in poor management, leadership and governance at the BBC.
  • Recommendation:We expect the broadcaster to ensure that the earmarked funds are used to support those presenters who told us they were facing "life-changing" liabilities as a priority, rather than higher paid presenters who are likely to be more able to manage uncertainty in future income.
  • BBC administering welfare benefits: The Report finds potentially far-reaching unintended consequences arising from the licence fee decision with the absurd situation of the BBC being pushed into decisions that individuals make about their uptake of welfare payments.
  • However, the BBC must now execute the policy for which it took on responsibility.
  • The Report found the impression given by the BBC in evidence before the Committee that it had reluctantly taken on responsibility for the policy at odds with correspondence from 2015 that indicated this was a responsibility it had requested.
  • BBC Equal Pay: The Report notes some evidence that the BBC is continuing to take steps to resolve equal pay issues set out by the DCMS Committee 2018 report but flags there was still a long way to go.
  • Public Service Companies: A full list of recommendations can be found in the report.

Further information

• As part of the Committees scrutiny of the BBC Annual Report, MPs are also expected to consider audience figures and performance across TV and radio networks, the BBCs commercial operations, as well as progress on gender and equal pay.
• Questions will also focus on the duty of care to participants for the on-going inquiry into Reality TV with Editorial Policy and Standards Director David Jordan among those giving evidence.
• Supporting documents provided by the BBC will be published on the website at the beginning of the evidence session, as well as written evidence submitted to the DCMS Committee relating mainly to the TV licence change.

• As part of the Committees scrutiny of the BBC Annual Report, MPs are also expected to consider audience figures and performance across TV and radio networks, the BBCs commercial operations, as well as progress on gender and equal pay.
• Questions will also focus on the duty of care to participants for the on-going inquiry into Reality TV with Editorial Policy and Standards Director David Jordan among those giving evidence.
• Supporting documents provided by the BBC will be published on the website at the beginning of the evidence session, as well as written evidence submitted to the DCMS Committee relating mainly to the TV licence change.