Wednesday, July 30, 2003

The Economist Ponders the BBC's Future

Who should regulate the BBC? And who should pay for it? Until recently, the status quo looked unshakeable. On important questions, like whether its journalists were biased, the BBC would regulate itself, just as it always has. And when its charter comes up for renewal in 2006, few doubted that it would gain another juicy increase in the licence fee, the annual tax paid by every television-owning household in Britain, which currently stands at �116 ($186).

Since the row over Iraq's arsenal, those questions look more interesting and open. The BBC has never managed complaints well: robust self-scrutiny is not a strong point of its bureaucratic, inward-looking culture. The final court of appeal is the 11-strong board of governors. But the governors also appoint the BBC's director-general, which critics say makes them too close to the organisation to be able to regulate it properly.

The government certainly feels that its complaint over Andrew Gilligan's reporting was badly handled. The governors leapt to Mr Gilligan's defence, largely echoing the BBC management's line and admitting only minor procedural flaws in the reporting of the story. In retrospect, the governors might have done better to wait for a formal complaint from the government and then to investigate it with visible thoroughness, rather than rushing to support their own. Reports suggest that some have since voiced private doubts, but too late to dispel government fury.


The much bigger question is about future financing. Technology is steadily undermining the BBC's main justification for the licence fee: that as everyone benefits from at least some of its services, everyone should pay. Viewing figures are dropping steadily as viewers turn to digital television, which now reaches nearly half the households in the country. The BBC's response so far has been to provide ever more services. Sometimes this is uncontentious—for example in digital radio, now booming, which would never have taken off without BBC backing. But other offerings are controversial—internet-based education, for example, or a specialist history channel that competes directly with an independent commercial outfit. An outside regulator could stop the BBC from treading on so many private-sector toes.

Falling viewing figures have not created a financial problem for the BBC, since thanks to the government's generosity the licence fee has been rising at 1.7% above inflation since Labour came to power. But big rows with politicians could undermine the chances of a similarly lavish settlement in 2006.
Personally, I think the BBC's television tax should simply be abolished outright, or at the very least, slashed in half. Funding for the BBC's World Service radio broadcasting I can understand, but do we really need a proliferation of BBC-branded television channels, all funded on the public's dime yet accountable to no one, not even to their prospective audience?

Of course, knowing the British public's distaste for radical measures, this will never happen. British gradualism certainly has many merits in its' favor, but boldly doing away with outmoded institutions certainly isn't one of them.