A question Welsh broadcasters should fear

Geraint Talfan Davies examines the Culture Select Committee report on the BBC Licence fee deal and finds reason to worry

Two significant events in the media world coincided last week: the publication of the Culture Select Committee’s appraisal of the ‘behind the bikeshed’ settlement of the BBC’s licence fee – including the DCMS/BBC deal on S4C – and the announcement of Alex Salmond’s shopping list for Scotland. The latter included the creation of a Scottish Digital television network.

What, you may ask, is the relationship between these two things? The answer is encapsulated in a question set out in paragraph 44 of the Select Committee’s report:

“We asked how the BBC could justify putting more money into S4C than it was putting into any other region of the UK, given its commitment to represent all the nations equally.”

It is a question that all viewers in Wales, whether of the BBC or S4C, should have some reason to fear. It is also a question that Scottish proponents of a new Scottish network will be tempted to use in arguing their own case.

Until now we have lived with a settlement that gave Wales an addition to its broadcasting infrastructure – an extra public service broadcaster, S4C – that was not replicated anywhere else in the UK. It was an explicit acceptance of the exceptionalism of Welsh need in relation to Welsh language broadcasting. That exceptionalism was reflected in S4C’s funding model, via direct taxation that was also a recognition that no existing broadcaster could take on this costly obligation without detriment to its other purposes.

It was another expression of the care that Britain has taken to ensure that its public broadcasters did not compete for funding sources. The BBC is funded through the licence fee, ITV through advertising, and S4C first through a levy on ITV but later through a combination of direct taxation, a small slice of advertising income, and a limited BBC expenditure that reflected the corporation’s historic commitment to broadcasting in the Welsh language.

Under the proposed new system, S4C will be funded predominantly through a call on the licence fee. This means that if the logic underlying the Select Committee’s question were to be followed through it would imply a constant pressure to reduce BBC expenditure in Wales closer to a norm that serves, elsewhere in the UK, mainly single language provision. If the funding of S4C is brought within a BBC commitment “to represent all nations equally” – a commitment that I have not seen expressed before – then there can be only one result: further reductions in the budgets of either S4C or BBC Wales’s English language services for Wales or, more likely, both.

That pressure will be intense, not least because the Committee badly underestimates the pressure on total BBC funding. It argues that through a combination of savings already identified, and a growth in licence fee income through an increase in the number of households, “in practice the BBC will have to make rather less than 16 per cent savings”. But the Committee has not taken fully into account the fact that inflation is running well ahead of the two per cent allowed for in initial calculations, nor the impact of the substantial deficit in the BBC’s pension fund. The BBC itself is looking to cuts closer to 20 per cent in most services.

The production community in Wales is already bracing itself for the impact of the 25 per cent cut in S4C’s budget, and viewers are yet to see the full force of that reduction on the screen. Further reductions could create a tipping point that would plunge Welsh independent producers into an abyss. Another 20 per cent cut in the English language services for Wales would decimate BBC Wales services, with opt-out programming being lost from either BBC1 or BBC2, and the radio services – Radio Wales and Radio Cymru – being completely unable to live up to national mission that they have rightly sought to espouse.

Now the Select Committee did not ask its question not in a conscious attempt to elicit some principle of equity. Rather, it did so in order to ascertain whether the S4C funding was regarded as part of the BBC’s overall funding, or whether it was an example of “top-slicing” of the licence fee “in support of wider public service content”. The committee disagreed with the view of Sir Michael Lyons, the recently departed Chair of the BBC Trust, that this was not top-slicing because there would still be an oversight of this expenditure by the BBC Trust.

The Committee’s view was that to argue that taking money from the licence fee and giving it to S4C was not top-slicing, was “dancing on a pin-head”. It was unequivocal:

“It seems evident to us that some of the additional responsibilities that the BBC has taken on under the terms of the settlement widen the scope of licence fee spending beyond any previous interpretation of the BBC’s mission and purposes. By any normal definition, this constitutes “top-slicing”.

This plain verdict will not stop the theologians of public service broadcasting from debating the point for a few years yet. But it is not just a theological point. There are practical effects. The Committee has difficulty is seeing how one can reconcile the BBC’s absolute insistence that this is not top-slicing (and that, therefore, it must retain some oversight over S4C) with S4C’s insistence – echoed by everyone in Wales – on its own creative and operational independence.

Conceding the principle of top-slicing does create new dangers for the BBC, but insisting on it may also imply that the BBC Trust will not differentiate between its funding of S4C and its funding of other services in Wales. In the committee’s own words:

“While there may be benefits to both parties from the partnership, there can be no doubt that substantial public funding otherwise available for other BBC content and services will be diverted to S4C”.

That may be uncontroversial in the rest of the UK. However, in Wales that way lies a fanning of the embers of tension between the languages in the broadcasting field that will not serve viewers well, whatever their language of choice. Bilingual or monoglot, we are in this together.

The Select Committee admits to the possibility that the proposed arrangement will not work. It says that in that event the Government should simply top slice the licence fee and give the money straight to S4C. In the overall Welsh interest that may be preferable, even if it is an option that causes discomfort on other grounds. The fairer solution would be to make a levy on BSkyB the price of allowing News International to buy it lock stock and barrel – a small charge for such huge market dominance.

Geraint Talfan Davies is Chair of the IWA.

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