(VIII) THE PUBLIC SERVICE BROADCASTING
REMIT AND THE REMITS AND REGULATION OF COMMERCIAL PUBLIC SERVICE
333. Subsections (3) and (5) of Clause 181 represent
the first comprehensive attempt to define in statutory form the
overall public service remit for television. The details of that
remit are based very closely on the terms of Clause 5 of the Agreement
between the Secretary of State and the BBC. Accordingly, the first
requirement has a Reithian ring to it:
"that the relevant television
services provided by the public service broadcasters (taken together)
comprise a public service for the dissemination of information
and for the provision of education and entertainment".
334. The proposed terms of the public service remit
for television have been the subject of two broad types of comments
- those from public service broadcasters and their current regulator
seeking to have the remit simplified and those from outside organisations
wishing to see the remit strengthened.
335. The ITC considered that the items identified
in Clause 181(3) and (5) ought to be seen as a statement of "overall
objectives" for public service broadcasters, rather than
a shopping list of "requirements", as at present.
This view was endorsed by the BBC.
Channel 5 was concerned that the Clause as it stood could be read
as implying that each public service broadcaster had to cover
each genre, rather than being able to play to their particular
questioned the need for the remit to have regard to the days on
which programmes are shown and the times of day at which they
are shown, arguing that this might give OFCOM authority to intervene
in scheduling matters.
336. Others were concerned at any attempt to weaken
the public service remit. Public Voice argued:
"The decision to define
public service broadcasting in the legislation is one of the key
aspects of the [draft] Bill and must be protected. The definition
of public service broadcasting in the legislation is a cornerstone
of protection for citizens' interests and must remain as a strong
benchmark for measuring performance."
Professor Vincent Porter of the Voice
of the Listener and Viewer was concerned that even the existing
concept of requirements applying to all broadcasters "taken
together" might lead to the requirements on commercial public
service broadcasters being lightened and more difficult or minority
aspects of the remit being transferred to the BBC.
The Voice of the Listener and Viewer and Professor Eric Barendt
both questioned whether OFCOM's ability to "have regard to
the desirability" of the general requirements in subsection
(2) being met in such a way as to ensure that the specific requirements
of subsection (5) are also satisfied was sufficiently strongly
337. In addition to comments on the framework established
in Clause 181, proposals were also made for additions to the detailed
requirements. Foremost among these was the suggestion, that was
supported both in formal evidence and in many contributions to
our online forum, that international issues ought to be included
in the range of programming as well as religion and social issues.
A similar case can be made for the inclusion of "science".
338. In general terms, we consider that the Government
has struck the right balance in its definition of the public service
remit. We agree with the proposition that the term "objectives"
more accurately reflects the nature of the commitments involved
than "requirements" and we recommend that Clause 181
be amended accordingly. We also consider that it is right that
a set of objectives for all public service broadcasters should
be more detailed than is necessary for the BBC with its long tradition
of public service broadcasting and we therefore recommend that
the Government gives careful and sympathetic consideration to
the case for including fuller descriptions of topics for programming
in Clause 181(5).
339. Clause 181 also proposes that OFCOM undertakes
periodic reviews of the public service broadcasting remit and
publishes a report on that review. The first review is to take
place one year after the coming into force of the provision, with
subsequent reviews every three years. The ITC argued that such
reviews ought to be held annually, in order to inform the annual
programming statements of individual licensees and to prevent
a frenzy of interest focused around the triennial exercise.
This view was shared by ITV, Channel 4 and Channel 5.
Chris Smith also thought that these reviews should be more regular.
The ITC made proposals with the aim of enabling the reviews to
be distinct in purpose from arrangements for oversight of individual
commercial public service broadcasters, even if the two processes
took place with the same regularity.
340. Tessa Jowell thought it was important to maintain
a distinction between OFCOM's specific reporting duties in respect
of Channels 3, 4 and 5 and the more strategic review of the performance
of public service broadcasting.
We agree with Tessa Jowell that it will be important to maintain
a clear distinction between the oversight by OFCOM of the programme
policies of the commercial public service channels and its reviews
of public service broadcasting as a whole. It would be very difficult
to maintain that distinction if both exercises took place with
the same regularity. At the same time, we are concerned that,
given the speed of change in broadcasting, a three year wait could
be too long. We recommend that Clause 181(1) be amended to
provide that OFCOM reports on the fulfilment of the public service
remit are to be published every two years.
341. We have rejected the proposition that reviews
of the public service remit be undertaken annually in part because
we are keen to see the reports arising from the reviews as major
events that play a central role in public debate on public service
broadcasting. We make further recommendations with this aim in
mind. First, we recommend that OFCOM be required to conduct its
review with the purpose of sustaining and strengthening public
service broadcasting in the United Kingdom. Second, we recommend
that OFCOM be required to review the ecology of public service
broadcasting, including the costs and financing of public service
broadcasting. Third, we recommend that OFCOM be required to report
on the contribution to public service broadcasting made by broadcasters
other than the BBC, S4C and holders of licences for public service
342. Clause 188 gives the Secretary of State power
to amend the main elements of the definition of the public service
broadcasting remit in Clause 181, but she may only do so following
a recommendation by OFCOM and subject to affirmative resolution
procedure. The Voice of the Listener and Viewer expressed concern
at the scope of this power and at the absence of any requirement
to consult the public as opposed to the broadcasters concerned.
This concern was echoed by BSkyB.
We recommend that Clause 188 be amended to provide that an
order to amend the public service remit in Clause 181 can only
be made by the Secretary of State in response to a recommendation
made by OFCOM in the reports arising from its periodic reviews
of the public service remit and even then only after a full public
consultation on that recommendation.
343. Clause 182 sets out the proposed remits for
the commercial public service broadcasters. The public service
remit for every Channel 3 service and for Channel 5 is envisaged
to be "the provision of a range of high quality and diverse
programming". The ITC expressed surprise that the remits
for these channels were proposed to be the same, given their distinct
roles and very different revenues; the ITC proposed that the ITV
remit be amended to refer to ITV's regional role and to its commitment
to original production and landmark productions.
ITV itself seemed sympathetic to this notion.
Tessa Jowell said that "we have made absolutely clear that
we see the continuation of network services of ITV and, therefore,
the specific regional characteristic of ITV as critical, and that
on the face of the Bill in relation to the
recommend that the public service remit for every Channel 3 service
in Clause 182 be amended to require the provision of a wide range
of high quality and diverse programming which, in particular,
includes a substantial range of high quality original production
and satisfies the tastes and interests of the part of the United
Kingdom for which that service is licensed.
344. The public service remit of Channel 4 as set
out in Clause 182(3) is "the provision of a broad range of
high quality and diverse programming which, in particular -
(a) demonstrates innovation,
experiment and creativity in the form and content of programmes;
(b) satisfies the tastes and interests of a culturally
diverse society; and
(c) exhibits a distinctive character".
This bears a close resemblance to Channel
4's existing remit in section 25(1) of the Broadcasting Act 1990.
ITV argued that Channel 4's remit had been "somewhat reduced"
and regretted the absence of a reference to the desirability of
Channel 4 catering for tastes and interests not generally catered
for by other channels.
Channel 4 did not consider that its remit was being reduced, only
put in more positive terms, and was sympathetic to a suggestion
from ITV that a reference to Channel 4's wider educational role
(in addition to its specific requirements in respect of schools
programming set out in Clause 198) might be added to its remit.
We welcome and support Channel 4's public service remit as
set out in Clause 182(3). We recommend that the Government consider
the case for inclusion of Channel 4's educational role in that
345. As part of Clause 188, it is proposed that the
Secretary of State should have a power to amend the public service
remits of Channels 3, 4 and 5 following a recommendation by OFCOM.
Channel 5 argued that this power would "not help in providing
any certainty to broadcasters and their shareholders as to what
future levels of public service broadcasting commitments will
be required of them".
Dawn Airey suggested that a broadcaster ought to be given at least
a year's notice of any change in remit.
A view was also expressed by the commercial public services broadcasters
and the ITC that the power to amend these remits ought to reside
with OFCOM. Tessa
Jowell saw it as important to maintain the power to amend the
remits to ensure that legislation had "the necessary flexibility"
to stand the test of time. She envisaged that the power would
be used "with due regard to the necessity and the possible
impact on investment decisions".
346. While flexibility and adaptability are general
merits in the legislative framework, we are not convinced that
this applies in the case of the remits of the public service broadcasters.
These are set at a very high level of generality. Although we
have recommended that the ITV remit ought to be more stretching
than that for Channel 5, we support the general notion of maintaining
the brevity and simplicity of these remits. They appear to us
to define the basic functions that Channel 3 services, Channel
4 and Channel 5 must perform in order to justify their privileged
spectrum access. If the commercial positions of the channels change,
there is a great deal of flexibility inherent in the licensing
regimes. If the public service remits had to be changed, this
would call into question the entire framework for public service
broadcasting to be established by the new legislation and would
justify Parliament looking afresh at the entire issue by means
of considering further primary legislation. The suggestion that
the order-making power reside with OFCOM, rather than the Secretary
of State acting solely upon a recommendation by OFCOM, would make
the matter worse not better, since it would entail one less safeguard
for what could in effect be a very significant change. We oppose
the power to amend the public service remits of licensed public
service channels by means of secondary legislation and recommend
accordingly that this provision in Clause 188(1)(a) be removed.
347. One of the requirements of the overall public
service remit is that the public service channels "provide,
for the purpose of facilitating fair and well-informed debate
on news and current affairs, a comprehensive and authoritative
coverage of news and current affairs in, and in the different
parts of, the United Kingdom and from around the world".
This general objective is reinforced by a more specific requirement
on commercial public service channels set out in Clause 191 to
"broadcast high quality domestic and international news programmes
and current affairs programmes throughout the day and in peak
The obligation to broadcast current affairs programming will be
a new requirement for Channel 5.
ITV did not take issue with these obligations.
The ITC, Professors Steven Barnett and Janet Seaton and the National
Union of Journalists all expressed concern at the failure to include
in Clause 191 the existing requirement on Channel 3 licence holders
under section 16(2)(a) of the Broadcasting Act 1990 to devote
"a sufficient amount of time" to such programming.
We can see no good reason for the exclusion of this phrase, which
sends a signal regarding expectations about the length of news
and current affairs programming in peak time that we suspect would
be unintended. We recommend that Clause 191 be amended to retain
the existing legal obligation on Channel 3 licensees to devote
a sufficient amount of time throughout the day and in peak viewing
hours to news and current affairs programming.
348. Clauses 183 and 184 establish a system for what
is termed "self-regulation" for the licensed public
service channels. Clause 187 provides for reversion to "detailed
regulation" to enforce the public service remits in certain
circumstances. In essence, the channels are required under Clause
183 to make annual statements of programme policy, including a
report on their own performance in the previous year, in accordance
with guidance issued by OFCOM. They are required by Clause 184
to consult OFCOM before making a change in programme policy. The
delivery of remits and regulation through statements of programme
policy was seen as valuable by Channel 4, since the statement
"forces each broadcaster to assert the best parts of themselves,
so when subsequent pressures come upon you in the course of the
year it sets out ambitions to which you have signed up".
349. A number of witnesses opposed the principle
of self-regulation outright or expressed concern about the way
it would work in practice. Equity considered that, during the
"trial run" of statements of programme policy this year,
"the ITC's Annual Report was severely lacking in any guidance
or criticism of the broadcasters and merely seemed to endorse
or report back what the broadcasters themselves thought of their
BECTU wished to see OFCOM "have a proactive and interventionist
role in order to secure quality public service broadcasting standards".
Professor Sylvia Harvey saw self-regulation as "a risky proposal
that could be seen to place corporate interests before audience
Both she and the Campaign for Broadcasting and Press Freedom saw
the system for reversion to detailed regulation under Clause 187
as a case of "shutting the stable door after the horse has
Public Voice also expressed concern that, given that the provisions
for detailed regulation could only be invoked if there was a serious
failure in respect of the public service remits which was "not
excused by economic or market conditions", this economic
defence would be prayed in aid whenever failure was alleged.
350. The ITC and the commercial public service channels
had rather different concerns about the proposals. ITV viewed
the provisions as "over-prescriptive" and particularly
criticised the possibilities for OFCOM to interfere in the drafting
of statements of programme policy opened up by Clause 184.
Channel 4 thought that this requirement "threatens to reduce
'self-regulation' to a meaningless aspiration".
The ITC endorsed the view that the provisions were "more
complex and heavy-handed than originally intended and less effective".
The ITC proposed that the system for prior approval by OFCOM for
changes of programme policy be replaced by an annual report by
OFCOM on the performance of the licensees in fulfilling their
351. The Government has faced a considerable challenge
in making statutory provision for "self-regulation"
by the licensed public service broadcasters. It appears that in
some measure the current proposals are less deregulatory than
the current system as now operated by the ITC. At the same time,
the sanctions in case of failure are more difficult to invoke
than those currently available to the ITC. Accordingly, we consider
that the proposals could be re-balanced in two ways. First, we
recommend that the provisions for prior consultation with OFCOM
on changes of programme policy as set out in Clause 184 be superseded
by a system of annual reports by OFCOM on the performance of each
licensee in relation to the relevant statement of programme policy.
352. Second, we wish to see OFCOM have additional
regulatory tools at its disposal in relation to licensees that
reflect changing economic or market conditions, but fall short
of a return to detailed regulation. We recommend that OFCOM
be given a power to review the financial terms of Channel 3 and
Channel 5 licences at the mid-point of any licence and to vary
licence payments for the remainder of that licence period. In
view of this added flexibility to ensure the correct balance between
the benefits of spectrum access and the burden of public service
obligations, we further recommend that the possibility for exemption
from detailed regulation under Clause 187(2)(a) as a result of
failure to fulfil public service remits when such failure is due
to economic or market conditions be removed.
353. In addition to the specific regulatory provision
for detailed regulation and the financial sanctions and possibility
of licence revocation that apply to all licence-holders, the Government
proposes to establish an additional regulatory lever for OFCOM
through the provision in Clauses 150 and 152 that all rights to
renewal of Channel 3 and Channel 5 licences will cease at the
end of 2014. This proposal has been criticised by both Channel
5 and ITV, who argue that this system will provide a disincentive
to long-term investment.
The ITC characterises the current system of optional renewal in
year six of a ten year licence, which ITV and Channel 5 wish to
see continue, as a "one-way bet" for the current incumbents.
354. In a supplementary memorandum, the ITC advanced
what it saw as several disadvantages to the 2014 "cut-off".
The ITC argued not only that it would serve as a disincentive
to investment, but also that it was the opposite of deregulatory
in its effect. The ITC proposed an alternative way forward based
on a charge separate from the general licence payments to reflect
spectrum value. The spectrum charge could be adjusted to reflect
the value of spectrum used by ITV licence holders and Channel
5 before and after digital switchover without the uncertainty
and disruption caused by the 2014 "cut-off".
355. Twelve years is a long time in broadcasting.
We have concluded that the Government is right in principle to
establish mechanisms for measuring the overall value of Channel
3 and Channel 5 licences beyond analogue switch-off. An explicit
process of licence allocation for the years after 2014 has advantages,
including as a safeguard for the regional character of ITV licences.
However, there is a danger that the process may serve as a disincentive
to invest in the years before then. We recommend that, in its
response to our Report, the Government set out its views on the
proposal by the ITC for separate spectrum charging as the best
way of capturing changes in licence value before and after digital
switchover and clarify how it envisages the new allocations being
made for the years after 2014.
640 Clause 181 (5)(a). Back
Ev 1. Back
Q 524. Back
Ev 233. Back
Ev 439, para 33. Back
Ev 308, para 8.4. Back
Q 799. Back
Ev 167-168, Ev 303, (2b).2 Back
Ev 29, passim; Ev 308, paras 8.5-8.6; Q 802. Back
Q 802. Back
Ev1, paras 17-18; Q 22. Back
Ev 439, para 32; Ev 233; Q 581. Back
Ev 550. Back
Ev 1. Back
Q 1013. Back
Ev 302, para 2 (b) 4. Back
Ev 189. Back
Ev 1, para 16; Ev 1; Q 20. Back
Ev 439, paras 34, 38. Back
Q 1012. Back
Ev 439, para 35. Back
QQ 574-575; Ev 439, para 35. Back
Ev 233. Back
Q 694. Back
QQ 559, 694; Ev 1. Back
Q 1014. Back
Clause 181 (5) (c). Back
Policy, para 184.108.40.206. Back
Ev 233. Back
Q 562. Back
Ev 1, para 28; Ev 439, para 6 (iii); Ev 519, para 3.3; Q 20. Back
Q 581. Back
Ev 329, para 9. Back
Ev 331, para 12. Back
Ev 484, para 2.1. Back
Q 802; Ev 484, para 2.3. Back
Q 802; Clause 187 (1) (b). Back
Q 558; Ev 439. para 36. Back
Ev 202, para 4.82. Back
Ev 1. Back
Supplementary Memorandum submitted by ITC. Back
Ev 439, paras 27-30; Ev 233; QQ 570-572, 703-708. Back
Appendix 107; Ev 218. Back