The BBC will continue to be funded by a license fee but the BBC Trust is to be scrapped as part of an overhaul of the British pubcaster’s Royal Charter.
On Thursday (May 12), the UK’s culture secretary John Whittingdale published a white paper outlining proposed changes to the corporation that will be debated by lawmakers in the fall.
The BBC’s current 10-year charter expires at the end of this year and the next one will take effect for 11 years in order to remove the renewal process from the country’s election cycle.
Whittingdale’s recommendations include lifting the seven-year freeze on the license fee and pegging it to inflation for five years beginning in 2017/2018.
There will be a funding review after five years and the BBC will take responsibility for the license for over-75s in exchange for closing the “iPlayer loophole” so those who watch programming only online will pay the same fee as those who watch on television. However, the report also acknowledges the fee is “likely to become less sustainable” down the line.
The BBC will also have a new governance structure. The BBC Trust will be abolished and replaced with a unitary board, while external media and telecommunications regulator Ofcom will be appointed to handle investigations and editorial complaints.
Most of the board members will be appointed by the BBC, while others will be selected by a government-led public appointment process.
Distinctive and diverse content
When it comes to content, the report called upon the BBC to place a requirement of “distinctiveness”– particularly on mainstream services such as BBC1 – but Whittingdale added that he is “not saying that the BBC should not be popular.”
The broadcaster’s new mission statement will be “to act in the public interest, serving all audiences with impartial, high-quality and distinctive media content and services that inform, educate and entertain.”
A commitment to diversity – on and off screen – will be enshrined in the charter, particularly in regards to under-served audiences including “those from black, Asian and ethnic minority backgrounds and from the nations and regions which are currently less well-served.”
Production, budgets and transparency
Meanwhile, the in-house production guarantee will be completely removed in order to open television content commissions to greater competition in the indie production sector, except in the case of news and some current affairs. Presently, the BBC allows 50% of its content to be produced out-of-house.
Pending regulatory approvals, the existing in-house productions service will be spun off into the commercial subsidiary, BBC Studios, that will produce programming for the BBC as well as other networks in the UK and abroad.
In the fall, the government will have consultations around an annual £20 million (US$29 million) contestable public service content fund to allow other networks and producers to make public service content for under-served audiences, such as children and diverse viewers. The money will come from unallocated funding from the 2010 licence fee agreement.
“Rather than seeing other players as rivals, the BBC should proactively seek to enhance, bolster and work in partnership with the wider broadcasting and creative industries,” Whittingdale said. “There will be a focus on this in the new charter.”
The BBC will also have more freedom to manage its budgets. As such, protected funding of £150 million ($217 million) a year for broadband and £5 million ($7.2 million) a year for local television will be phased out.
An exception will be the BBC World Service’s annual funding of £254 million ($368 million), which will continue for five years. As previously announced, it will also get an extra £289 million ($419 million) over four years from the current government.
Transparency is also a focus of the report. Whittingdale said license fee payers should understand how the BBC spends money on different types of programming and so salaries for talent earning more £450,000 ($652,000) will be made public.
“This white paper delivers a mandate for the strong, creative BBC the public believe in. A BBC that will be good for the creative industries and most importantly of all, for Britain,” BBC director-general Tony Hall said in a statement.
“There has been a big debate about the future of the BBC. Searching questions have been asked about its role and its place in the UK. That’s right and healthy, and I welcome that debate.”