Culture Secretary Karen Bradley has today (Thursday 15 September 2016) confirmed the reforms to the BBC that will require the organisation to be more open and transparent about its operations while making sure the public broadcaster continues to thrive in the future.
The draft Royal Charter and the accompanying Framework Agreement published today set out the details of how the BBC will operate in the new Charter period. They draw on the policies published in the Government’s White Paper, A BBC for the Future: a Broadcaster of Distinction, published in May 2016.
Government has made a number of changes to the reforms since then to reflect the further discussions with the BBC, Ofcom and BBC Trust, as well as recommendations from the House of Commons Culture, Media and Sport Select Committee.
These changes include:
- Greater transparency – all BBC employees who earn more than £150,000 will have their salary details published, and there will be a full, fair and open competition for the post of Chairman of the new BBC Board.
- The National Audit Office (NAO) will become the BBC’s financial auditor and fully scrutinise the BBC’s value for money record – the Charter will enhance the NAO’s role and access and allow it to conduct value for money studies on all of the BBC’s activities including its commercial subsidiaries.
- Appointments to the new BBC Board – in addition to the agreed principle of a mix of public and BBC appointments, all made in line with public appointments best practice, the Charter sets out that [the BBC will appoint 9 board members, (including 5 Non-Executive Directors), and an additional 5 will be public appointments] and will mean the BBC will appoint the majority of members to its new Board.
Culture Secretary Karen Bradley MP said:
“The BBC produces world class programming that is admired and respected by millions around the world. The BBC’s next Charter will help it adapt to the changing digital world and continue to thrive into the future.”
“We have made considerable progress since the publication of the White Paper and resolved a number of important areas with the BBC, which go further in the key areas of transparency, fairness and securing the BBC’s independence.”
“Licence fee payers have a right to know where their money goes. By making the BBC more transparent it will help deliver savings that can then be invested in even more great programmes.”
In summary, the new Charter and Agreement will:
- Make the BBC as open and transparent as possible – the Charter sets out obligations for the BBC to be more open and transparent in its operations and the important information it shares, including the salaries of its employees and talent earning more than £150,000; and
- Enhance the distinctiveness of BBC content – the BBC’s Mission and Public Purposes have been reformed to reflect this requirement;
- Reform the governance and regulation of the BBC – the new BBC Board will be responsible for governing the BBC, and Ofcom will take on the regulation of the BBC – the Charter and Agreement sets out functions and obligations that they both must follow in order to deliver this;
- Prioritise the independence of the BBC – the Charter explicitly recognises the need for the BBC to be independent – particularly in editorial matters – and the BBC will appoint a majority of the members of the new Board, with strict rules to ensure all appointments are made fairly and openly;
- Ensure the financial stability of the BBC – the Charter makes clear the licence fee will remain as the key source of funding for the BBC for the next Charter period;
- Ensure that the BBC’s impact on the market is proportionate to the public benefits it delivers and, where possible, positive for both the public and commercial organisations;
- Ensure that the BBC serves all nations and regions and is more reflective of the whole of the United Kingdom – through operating licence obligations, specific Board representation and the continuation of production targets ensuring 50% of the BBC’s programmes are made outside of London.
The next stage in the BBC Charter Review process will be parliamentary debates of the draft Charter and Agreement including in Scotland, Northern Ireland and Wales during the autumn. Following these debates, the Government will present the Charter and Agreement to Privy Council, to come into force on 1 January 2017.
Given the fundamental reforms set out in the draft Charter and the need to ensure there is a smooth transition, the organisations involved will need time to implement these complex changes. The Government has allowed for a short period of transition with the new BBC Board and Ofcom fully taking on their new governance and regulatory roles on 3 April 2017. The BBC will continue to operate under the current arrangements during this transitional period.