The governance and regulation of the BBC

Richard Collins
7 April 2011

The House of Lords communications select committee is investigating the governance and regulation of the BBC. Changes since the election will increase the responsibilities of the BBC, with funding for S4C and the World Service taken on by the licence fee funded BBC by 2015. 

The Lords inquiry will assess evidence on:

  • The duties that the BBC Trust is tasked with and whether the allocation of its duties is transparent & well understood;
  • Whether the BBC Trust is sufficiently independent of Government and the BBC Executive;
  • How effective the BBC Trust has been to date;
  • How accountable the BBC Trust is to the taxpayer and to Parliament; and
  • Potential improvements to the governance & regulation of the BBC.

Below, we present the written evidence submitted by Richard Collins, media studies professor at the Open University and contributer to openDemocracy's Public Service Broadcasting Forum.

The BBC Trust represents a significant step forward in the governance of the BBC and in securing for the UK the benefits of an efficient, well functioning, public service broadcaster. It is more transparent than its predecessor, more effective thanks to its own secretariat and, because it, rather than DCMS, has primary responsibility for the approval of new services, the Trust has strengthened the BBC’s independence from Government

However, existing arrangements do not clearly separate governance from management and regulatory responsibility is not clear, because the Trust has duties which are not clearly distinguished from Ofcom’s. Moreover, the Trust is not an appropriate body to oversee funding for bodies other than the BBC (notably S4C) for the Trust formally is the BBC – how can it act, and be seen to act, dispassionately and impartially in allocating funds between the BBC and non BBC bodies and activities?

Change is therefore desirable – both to remedy the flaws in established arrangements and also to make the most of new opportunities to diversify, pluralise and extend the provision of public service broadcasting and analogous services. Technological changes have effectively abolished spectrum scarcity and made it possible for new services with a public service remit to be established. An impartial body, charged with allocating funds to the BBC and S4C, could also assess the strength of these bodies’ claims and of new claims on public funding such as those made by the Scottish Broadcasting Commission and by online public service content providers.

Are the BBC Trust’s duties clear and its tasks the right ones?

The recent BBC Strategy Review has shown that the relationship between the Trust and the BBC’s management is one which makes policy formation and decision making unacceptably laborious and wasteful of time and money.

The Strategy Review involved the Trust requesting the BBC Director-General (DG) to formulate proposals; the DG to submit them to the Trust; the Trust to open them to public consultation, and after that the Trust to issue its definitive “asks” to the BBC executive. In some cases the executive will then have to apply formally, and separately for each service in question, to the Trust for permission to make changes; the Trust will undertake a formal “public value test” (involving a market impact assessment undertaken with Ofcom, public consultation, consultation with the BBC’s audience councils and, if a new service is under consideration, securing approval from the Department of Culture, Media and Sport which retains a veto over the introduction of new BBC services), publish its provisional determination, (normally) publicly consult on it and only then issue a decision on which the Executive may act.

In the actual sequence of recent events, the BBC Executive proposed the closure of two of the BBC’s smallest radio services: the Asian Network and 6 Music. There is room for doubt as to whether either was seriously considered for closure (rather than as a rhetorical gesture designed to attract public support for the notionally threatened services and thereby justify their continuance) but whether or not that is the case, both services have, at the time of writing, been reprieved. The status quo has not changed yet a lot of time, money and effort has been expended. The Strategy Review process has done little to build public confidence in either the good faith of the BBC parties concerned or the effectiveness of the BBC governance apparatus. The lengthy process and consumption of human and material resources has been wasteful, cumbersome and more representative of Dickens’ Circumlocution Office than of an efficient and effective public service broadcasting system.

The distinction between governance, the Trust’s domain, and management, the Executive’s domain, is unhelpfully confused. The Trust has claimed that it: 

has done a lot of work aimed at….. changing the BBC. We have put in place tighter editorial standards and have championed stronger efforts to make programming more distinctive. We have pushed the BBC to curb top talent pay and reduce the salary bill for senior managers. We have encouraged the development of more innovative forms of cooperation and interaction with other broadcasters. We have introduced a tighter remit for the BBC’s commercial arm, BBC Worldwide.

This sounds like the actions of management. Where are the demarcation lines between BBC management on one hand and regulation and governance by the Trust on the other? There is nothing intrinsically wrong with the Trust fostering changes such as these but in doing so it shares responsibility for the outcomes which arise from them and so cannot reasonably be expected to act as a disinterested judge (eg should regulatory issues arise) in matters arising from such changes.

The BBC Trust is now responsible for both the Executive’s internal governance and for some of its regulation (including some matters which Ofcom regulates for all other broadcasters). Could the Trust's regulatory responsibilities be better allocated elsewhere? Do other bodies have responsibilities and duties which could advantageously be transferred to the Trust?

The split in regulatory responsibility between the Trust and Ofcom is unhelpful and confusing – not least to potential complainants. It is wasteful and absurd that both Ofcom and the BBC Governors took up viewer complaints about (for example) Jerry Springer. The Opera – an anomaly which has survived replacement of the Governors by the Trust. Moreover, both Ofcom and the Trust now have responsibilities for public service broadcasting beyond (as well as including) the BBC. The Trust is now responsible for funding S4C, Ofcom undertakes the  Market Impact Assessments when the Trust undertakes a Public Value Test and Ofcom has also had responsibility for reviewing, and reporting on, public service broadcasting in general. Ofcom’s most recent report on public service broadcasting delivery shows that the ratio of the BBC’s expenditure on original programming against its income has declined at a time when commercial public service broadcasters rose. It is anomalous that Ofcom has an overall responsibility for public service broadcasting but lacks powers in respect of the BBC, the UK’s largest public service broadcaster and which, as this recent case in point demonstrates, may provide causes for concern.

Clarity and economy would be served by clearly locating with Ofcom regulatory (but not governance) responsibilities in respect of the BBC. However, this would not resolve the mis-match between Ofcom’s (or the Government’s since it is not clear whether Ofcom’s responsibility for public service broadcasting review has now passed to DCMS) duty to report on, and foster, the health of public service broadcasting and its lack of authority vis a vis the BBC. This mis-match could be resolved by extending Ofcom’s duties and increasing its powers – eg by strengthening Ofcom’s content section/Content Board and endowing it with a degree of independence on the lines of the Ofcom Consumer Panel. This would have the merit of economy in that no new institution would be required. But the contradiction would probably be better resolved by putting into effect the Burns’ Panel’s recommendation that a public service broadcasting authority be established. Such a body could dispassionately allocate funding to the BBC and S4C (and any other future claimants on public funding for public service media such as the Scottish service proposed by the Scottish Broadcasting Commission and/or the Public Service Publisher canvassed by Ofcom); it could assume Ofcom’s responsibilities for public service broadcasting reporting and oversight and thereby free the Trust of the confusing mixture of regulatory, governance and managerial responsibilities with which it is now charged.

In particular the regulation of BBC content is divided between the BBC Trust and Ofcom and the procedures for the handling of complaints overlap. Could these arrangements be improved?

A single locus for the adjudication of complaints, with powers to require redress for complainants whose complaints are upheld, is desirable. This should probably be Ofcom though, because relevant expertise would reside with a Burns type Public Service Broadcasting/Media Authority (should one be established), there is a case for such powers to reside with the new Authority.  However, it is important that complaints should first be directed first to the BBC (which, in recent times, has notably improved its complaints handling) and only after a BBC response should dissatisfied complainants enjoy a right of appeal to Ofcom or the Public Service Broadcasting/Media Authority. 

Arrangements such as these would pose the question – is there a governance role for the Trust? UK corporate governance is distinctive in normally having a unitary board, usually chaired by a non-executive chairman to whom the CEO/managing director is responsible. The BBC model does not conform to this norm. The Trust is the equivalent of the board of directors but the Director General is not a member of it and, further, the BBC Management Board (Executive) has non-executive members. Rather the Trust could, and I believe should, become the basis of a unitary board, chaired by a non-executive (the established Chair of the Trust) with the Director General, and perhaps a small number of BBC executives such as the heads of finance and operations, being members of the new unitary board.

Is the BBC Trust sufficiently independent?

Is the BBC Trust independent of Government?

The UK has been fortunate to have many members of the Trust (and Governors) strongly committed to the BBC’s independence. But there are limits to the independence of those who are appointed by Government. Despite positive recent developments, such as public advertisement, Nolanisation of the appointment process, scrutiny by Parliamentary Select Committees etc, there is room for further strengthening of the Trust’s independence. Another House of Lords Select Committee suggested that recommendations for Trust appointments should be made by an independent panel. This would strengthen the BBC’s independence, as would implementation of that Select Committee’s recommendation that the BBC be established by statute  (though it is important to recognise that the UK has more than one Parliament and Parliament like body).

Is the BBC Trust sufficiently independent of the BBC Executive?

No, however the only context in which such a question arises is one of confusion. Were the Trust to have no regulatory responsibilities such a question would not arise and the Trust, whether or not re-constituted as a unitary board, could unambiguously fulfil its role of being the BBC. Under current confused arrangements the Trust’s ability to act in the interest of licence fee payers has appeared compromised because of its responsibilities as the BBC – too often the interests of licence fee payers seem to have been equated with the interests of the BBC itself.

How effective are the BBC Trust's processes?

Does the Trust have sufficient oversight of BBC management? 

Again, this question arises out of the current confused arrangements. Separation of BBC regulation from BBC governance and establishment of the Trust as a unitary board would make possible effective oversight (governance) in both a positive, developmental, sense and a properly negative, checking, cautioning, enjoining prudence, sense.

How effective and transparent is the Public Value Test in assessing proposals for new BBC services?

The Public Value Test (PVT) has helped increase transparency in the management and governance of the BBC. Adoption of PVT like practices (Drei-Stufen-Test) in other EU States testifies to the positive impact of the PVT model. But, the Trust’s responsibilities for implementing the PVT has inhibited its ability to exercise a positive role and revivify BBC management’s commitment to, and BBC practice of, a sense of public service mission. Public value theory was, in its original form (that developed by the American public management theorist Mark Moore) a messianic slogan and rallying cry for reinvigoration of the public sector. But the PVT has institutionalised what Professor Mike Power has called a “ritual of verification”: that is a bureaucratic holding to account of those who do and create by an external authority. The PVT is perceived as an externally imposed hurdle that management has to surmount rather than a doctrine encouraging an enabling public service engagement with the BBC’s users and publics.

Moreover, a Trust commitment to transparency has not been implemented consistently: for example, the Trust (in contrast to Ofcom’s standard practices) did not publish responses to its consultation on the BBC management’s Strategy Review (BBC 2010). And the procedural complexity associated with the current Strategy Review process is hardly one which facilitates understanding or participation. Whilst the Trust is undoubtedly more open in its practices, and apparently less dependent on BBC management, than was the BBC Board of Governors – improvements evident in the conduct of the PVTs – the fundamental problem of governance and accountability has not been resolved, only restated. The PVT ultimately depends on the judgements of those who make it. The BBC Trust is, ultimately, appointed by the Government. It occupies an ambiguous zone between being an independent supervisor of the BBC, the BBC’s advocate and cheerleader, and the body finally responsible for the BBC’s survival and success. Charging Ofcom with the final responsibility for the PVT Market Impact Test testifies to the perceived importance of a body independent of the BBC in these practices of regulation and governance. It is striking that the BBC has seen the NAO as a body to be controlled rather than welcomed and that much of the welcome transparency has come through the operation of outside agencies such as the NAO.

How well does the system of review of existing BBC services by the BBC Trust.

The service licences bring in a welcome scrutiny of existing services but do not have the status of a PVT. Applying the PVT only to projected new BBC services suggests that the issues which matter are ones of expansion not the securing of either greater effectiveness in maintaining the status quo or reduction of an overextended BBC’s activities. There is thus an institutional bias built in to the Trust’s current PVT/service licence review process.

Is the BBC Trust sufficiently accountable?

Does the BBC Trust deliver its responsibilities to licence fee payers to ensure that the BBC delivers value for money?

It is hard to know. The best information in the public domain is in the NAO reports available on the BBC Governors’ and the Trust’s websites – much of this suggests that the BBC delivers poor value for money. The new NAO right of access promises to assist in clarifying this matter, as would a re-structuring of BBC management and governance on the lines sketched above – this would reduce the likelihood of the Trust interpreting the licence fee payers’ interest as being the same as the BBC’s interest.

Is the Trust’s accountability to Parliament adequate?

Baroness Warnock has helpfully argued that accountability can be conceived as a two part process: of giving of an account and of being held to account. The NAO and both Houses’ Select Committees have contributed to the giving an account aspect of accountability as has the Trust itself: more information is in the public domain and that is to the good.

But there is a delicate and difficult balance to be struck in respect of holding to account an institution, the BBC, which is charged with independence from other power centres and from Government in particular. The key issues are the terms of the Charter and the level of funding. Currently, both of these vital matters are effectively negotiated by Government and the BBC sub rosa. Both would be better done through a Parliamentary process thus improving the accountability relationship by augmenting both transparency and the BBC’s independence of Government.

How could the governance and regulation of the BBC be improved in the short and long term?

Please see above. On balance, a Burns type body for the funding and oversight of public service media should be established. It should take over responsibility for public service broadcasting review and the allocation of licence fee/grant in aid funding. The Trust should become a unitary BBC board on which senior BBC management should be represented. Regulation should reside unequivocally with Ofcom.



Further evidence given to the inquiry is available via parliament live:

(1) Current BBC Trust chariman Michael Lyons and former BBC and ITV chairman Michael Grade

(2) Steve Hewlett, broadcaster and media consultant, Neil Midgley, assistant editor at the Daily Telegraph, Ray Snoddy, media commentator, and former BBC Chairmen Sir Christopher Bland and Gavyn Davies

(3) Tessa Jowell, former secretary of state at the Department for Culture, Media and Sport, Jon Zeff, a director of media at the Department for Culture, Media and Sport, and Andrew Harrison, chief executive officer at RadioCentre, and Andrew Barron, chief operating officer at Virgin Media.

(4) BBC Trustees David Liddiment and Diane Coyle


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