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I welcome everybody to the 10th meeting this year of the Enterprise and Culture Committee. I never realised that there was so much interest in European Union rules on state aid.
My partner is employed by the BBC.
Thank you. Agenda item 1 is on the review of the BBC's future in Scotland. We will have three panels of witnesses today, the first of which consists of representatives from the management of the BBC. I welcome Ken MacQuarrie, Blair Jenkins and Steve Ansell. I invite Ken MacQuarrie to say a few words by way of introduction.
I thank the committee for the invitation. I convey apologies from Jeremy Peat, our national governor, who cannot be here, as he is at a governors meeting in London. He wishes to say that he would welcome an invitation to give evidence to the committee at a future date. He wanted me to stress his apologies.
I kick off by asking for clarification on some things in your helpful written submission, which I thank you for sending to us. The concerns about quality that are mentioned in the submission are not restricted to BBC staff; they are shared by us all. Can you give a cast-iron guarantee that the proposed cuts will have no negative impact on the quality of output of BBC Scotland?
I would not implement a single cut if I believed that the quality of our output or services would be at risk. As we move into divisional and local discussions with staff, it is hugely important that we listen to what the staff say and address any concerns about quality so that we can together work our way through those concerns. I believe that our task is not only to maintain quality, but to increase the quality, depth and range of our services.
I am sure that other members will want to pursue that issue. You said that you are in negotiation with the unions. Will you clarify whether that means that BBC Scotland's proposals for change are subject to negotiation or whether it simply means that people will be consulted by receiving a presentation? Will there be genuine negotiation, such that the proposals could be subject to change?
Our management proposals are subject to consultation. We propose to achieve savings in the content divisions of 13.5 per cent over three years, which I believe to be both realisable and manageable. We need to achieve that cash saving. We have put forward a proposal on the detail of how that should be achieved, but we are willing to listen to responses. It would be fair to describe the process as consultation, as opposed to negotiation. Steve Ansell can give the human resources perspective.
What we have tabled are proposals—I underline the word "proposals". We were asked to produce plans of how we would save that amount of money and we have done so. We are now anxious to enter into dialogue with the unions so that we can talk through our proposals, listen to the unions' responses and, if necessary, modify our proposals.
I am confused. In his introductory remarks, Ken MacQuarrie said that he was in negotiation with the trade unions. Which proposals, if any, are negotiable? If the proposals are only for consultation, is that another way of saying "Take it or leave it"?
We need to deliver the 13.5 per cent saving over the three years, but we are happy, in negotiation, to listen to people's views on the exact detail of how that should be delivered. We have the broad thrust of a management proposal, but we are happy to discuss some of the details of implementation. We have consulted as a management team and we have put forward our best proposals, which we believe are deliverable.
Perhaps I should clarify. The formal position is that, like other divisions in the BBC, we have tabled our proposals and the unions have registered a failure to agree. The unions are currently conducting a ballot. Speaking personally, I am disappointed that we have not yet had the opportunity to have that mature, intelligent dialogue to get the unions' reaction to our proposals, but I hope that that will happen soon.
As management, should you not have ensured that you had the chance to have that intelligent dialogue?
Like other parts of the organisation, we were asked to submit proposals at national level and we have done that. The decision was taken to have talks at national level. Understandably, the unions asked to see the BBC's director general, Mark Thompson, to talk through the proposals and they were disappointed that the BBC was not prepared to put its proposals on hold. Hence, the unions are conducting the ballot. However, we are still anxious to have that mature dialogue.
Will you clarify what is subject to negotiation, as opposed to dialogue, within BBC Scotland?
We will be happy to sit down and discuss the detail of the implementation. That might include the phasing of particular jobs. For example, we might discuss whether we can bring local services on stream earlier and whether some of our text-based services offer the opportunity to bring in posts at an earlier stage. We can work together on such issues to implement change and we can take on the best ideas and listen to concerns. However, we cannot say that we can achieve less than the 13.5 per cent target that as a management team we are committed to meeting.
Is that because London has told you that you must achieve 13.5 per cent, come what may?
No. A 15 per cent target was set nationally and we delivered 13.5 per cent.
Who set the 13.5 per cent target?
I did. It is not a question of London telling us what to do. We consulted on the matter and considered what was doable, manageable and deliverable locally. I should say that the reinvestment that would follow is consequent on our delivering the savings, so if we delivered less, the reinvestment would not follow.
Before I open up the meeting to questions from members, I welcome Pauline McNeill MSP, whose constituency includes the headquarters of BBC Scotland. Of course, she is free to ask questions if she wants to do so.
I am slightly confused by some of Mr MacQuarrie's comments. Does the target of 13.5 per cent refer to a reduction in the budget or in staff numbers? I assume that it refers to the budget.
It refers to cash in the budget.
You intend to achieve most of that reduction by reducing the number of posts that are available. However, you talked about increased opportunities during the next three years and the potential for an increased number of journalists. Will those opportunities be for journalists who are outwith the BBC's staffing structure, rather than for BBC staff?
I was referring to the fact that we will reinvest the savings that we make, which we equate to £10 million. If we consider our plans for the number of jobs that there will be in delivering local and regional services, we expect there to be more jobs in year 4 than we currently have in BBC Scotland.
Will the jobs that you anticipate will be available in year 4, assuming that you bid successfully, be internal BBC posts? Are you reducing the staffing complement now with a view to creating alternative or additional posts?
It is our intention that the posts will be internal BBC posts in news.
Will the current terms and conditions apply in four years' time?
Yes, I think that they will. As the unions will perhaps tell you in the next part of the meeting, we are in consultation with them about a new pay and rewards package. That dialogue stems from the unions' desire for a more transparent pay system.
The submission that the committee received from the Broadcasting Entertainment Cinematograph and Theatre Union begins:
The savings across the United Kingdom are delivered by a mix of outsourcing. In professional services and our information unit, for example, we have tabled management proposals for outsourcing. That is particularly true in finance and human resources.
BECTU says that you will
We can consider the issue area by area. A proposal has been put forward to sell BBC Broadcast. Similarly, there could be a new arrangement in relation to BBC Resources, which might be a partnership or a sale. I do not quibble with the terms as they are used in the BECTU submission.
In your written submission, you said that the bulk of the job losses would fall in Glasgow. It has been suggested to me that the reason for that is that the staff in Edinburgh have much better relationships with management and have been able to negotiate a much better working relationship. Could you comment on that?
I have no sense of management having different sorts of relationships with the staff in Edinburgh and the staff in Glasgow. I believe that the management relationships have been good across the board. That was never a factor in the proposals and I have not heard the suggestion that you mention. The issue was more one of critical mass, in that the bulk of our staff work in Glasgow. Furthermore, following devolution, we moved into a new building in Edinburgh, the Tun, and made arrangements to cover the work of the Parliament, which means that we had considered our arrangements in Edinburgh much more recently.
Would it be fair to say that the cuts that you are proposing to implement are, in effect, efficiency savings?
We have to deliver more effectively and efficiently. We are a public service broadcaster and we are trying to deliver what we are required to deliver as effectively and efficiently as we can by simplifying our internal structures and our processes and by investing in technology and training. Efficiency, as a broad term, would fairly describe what we are doing.
From what you said earlier, I take it that you would not implement any cuts that would put at risk the quality of the output. Are you guaranteeing that there will be no reduction in the quality of BBC Scotland's output following the efficiency savings?
I am guaranteeing absolutely that we will maintain the quality of BBC Scotland's output. My ambition is to increase the range and the depth of that output.
Given that it is possible to maintain the quality of the output while making efficiency savings, who was responsible for the inefficiency?
It is important to consider the context in which we are working over the next three years. In July 2007, we will move into a new headquarters. In the run-up to that move, we have involved 200 of our staff in examining our processes with a view to finding out whether we can do better by changing our processes and the structure of the organisation and the relationships within it.
Your line of argument is that it will be possible to maintain the quality of the output while making the organisation more efficient, the move to the new building notwithstanding. Given that you have been a senior manager with the BBC for some time, would you agree that you are, in part, responsible for allowing the organisation to become inefficient, which is what will enable you to make the efficiency savings at this point?
Year on year, we have delivered efficiency savings that have not been remarked on. I wanted to indicate to the staff that we were having, if you like, a step change in the level of efficiencies that we were delivering. For example, of the 13.5 per cent that we are delivering, our normal target would have been 2 per cent a year, which would have come to a total of 6 per cent over the three years. That means that, over the three-year period, the target that we must deliver is essentially 7.5 per cent that we did not plan to deliver in the normal run of business, which would have been completely unremarked.
I will stick with the issue of quality. I have been informed that the news and current affairs section in Scotland will lose 42 staff over the next three years if the cuts go ahead. Will you explain how those cuts will not impact on the quality of news and current affairs output?
We will reconfigure the arrangement of the newsroom to create a news hub that will provide a source of news to all our outlets. I think that we will also make proposals relating to video journalism—the union submissions mention PDP, or personal digital production. Those proposals will be made not in a doctrinaire fashion, but only where we will receive benefit from video journalism. As a result, we will increase our capability to acquire news, so that news inputs and the range of news that is available to us will increase.
Ken MacQuarrie has covered the main points. The issue is partly to do with operational changes in the way in which we work across programmes and platforms and partly about technology changes, some of which are already in place and some of which we expect to come on stream over the next few years.
I want to ask about PDP. Are you saying that the quality of work from a PDP camera is equivalent to that which is produced by the normal crews with standard television cameras?
There is clearly a difference in the cost of the two cameras and, if we go down several generations, a diminution in quality will be noticed. However, quality also depends on how something is edited and we do not need to go for a lower-quality camera. We would have the option of going for high-definition PDP cameras, although they are tape based and that would provide challenges for us in our tapeless building in Pacific Quay.
I hear what you say, but I have seen the quality from PDP cameras that are being used by the BBC as part of its pilot. To put it bluntly, the quality was rubbish compared with what a normal camera crew produces. You cannot tell me that you will cut 42 news and current affairs staff over the next three years, that there will be more journalists going around with nothing more than glorified video cameras and that there will be no reduction in output quality. That is unbelievable.
I do not accept your contention that the quality is rubbish. The quality of the cameras that we propose for the video journalists is increasing all the time, but a lot depends on how that material is packaged and edited, whether it is used on the right story at the right time and whether it is shot in the right light conditions. I do not recognise what you say about the quality being rubbish. Some of the best pieces of journalism that I have seen have been shot on PDP.
It is worth adding that that is the format that we have been using for three years now for "Reporting Scotland" and other programmes and I am not aware of a single complaint from a single viewer about the quality of the items. Programmes in other parts of the BBC are using that production technique far more than BBC Scotland is and they are achieving good results. We have taken a properly cautious view of the introduction of that technology. We do not think that it is the only way in which broadcast journalism will work in future, but we believe that it has a part to play. Our phasing-in of that technology over the next three years will reflect that cautious approach.
I would like to ask about your out-of-Glasgow strategy. Over the past three years, we have seen welcome improvements in programme output from regional offices in Aberdeen and other regional centres. Can that continue in the context of the 13.5 per cent savings that you are trying to make?
I believe so. We propose to lose two management posts in Aberdeen, but no production posts. I am delighted with and very proud of what has been achieved in centres outside Glasgow, from which we have delivered some of our most memorable programmes, both in-house and from the independent sector. We have developed companies such as Tern Television Productions, which has made programmes such as the award-winning documentary "Chancers", about the Airborne Initiative. That is the sort of journalism that has a place not only within Scotland as a nation but within the United Kingdom. By bringing Aberdeen into a relationship with our factual department, my ambition is that Aberdeen will supply not only Scotland but the UK. I believe that that is fantastically important.
Everybody would certainly hope for the kind of progress that you want, but there will obviously be concern that, because you are removing local management structures from Aberdeen and instead having staff report to managers in Glasgow, that will affect the decision-making process and people's ability to respond to local opportunities, which will not only make the management system more complicated, but will inevitably increase temptation to have more centralisation of programming and services. How do you respond to those concerns?
We met staff in Aberdeen and listened carefully to their concerns. One of the best things in developing programming from the north, for example, has been the really close links between the commissioners, the producers and deliverers of programmes. "Scotland's Secret War" was a recent example of such programming; the commissioning department worked hand in glove with the producers. The key relationship is that in which the budget holder and the deliverer work as one creative unit.
I still feel that to have potential for more management positions outwith Glasgow would give you a better ability to focus regionally and to increase and improve regional production. I know that you have an out-of-Glasgow strategy group, which will—I presume—continue to have representation from each region.
Absolutely. The relationship between Edinburgh and Glasgow probably defines the way that Aberdeen will work in the future as part of that network of different relationships.
I will pick up on what Mr Jenkins said about savings and there being room for cuts in the "process jobs", as he called them. I notice that the cuts will involve cuts in music services, the training department, the music library and the health and safety department. How will that help BBC producers to produce their programming more efficiently?
You refer to two different matters. When I talked about "process jobs", I was talking more about journalists who are located in the newsroom or back at base rather than being on the road; I mean the people who finish the product, if you like.
I misunderstood you. In that case, will you tell me about those backstage jobs?
I will answer on the information and archives jobs. We have had a lot of discussion with staff in information and archives about how the service will be delivered. The answer is that we will need to give access via an intranet or a web, which is how many of our producers already research and use material for training and research. We also need the right search engine and the right database to support the production staff, who will not be left without coaching or back-up in information and archives. What they will not have is a specific individual to do the research for them. Those single posts can cover only a limited section of what is required by the scale of our business at any one time, so it makes great sense to give the toolkits to the producers to enable them to access the data so that they are not in a queue, waiting for one individual to deliver.
So, your understanding is that the technology—the software that you can buy—will enable a person who has no experience or skills in music to mine the archives as quickly, effectively and creatively as could a trained archive librarian who spends his or her life specialising in that area.
If somebody's stock-in-trade was news, I would not expect them to have the same ability to research music. However, we will have a music department and we will have back-up from our information and archives. We will also offer training. Music producers will be able to carry out research in their specialist areas or genres of music; I am confident that they will be able to access the appropriate information.
So, a journalist working for you will get training in that type of research, in how to operate the new cameras, in how to work with different light conditions, in how to use the cameras effectively and in how to edit from the cameras. They will get more training, but the number of staff in the training department is being reduced. How will their training take place?
I believe that provision of continuing professional development for our staff is at the heart of delivering quality. We must do that in conjunction with individuals' needs, but also in conjunction with output needs. The investment in training that we will require is absolutely necessary to deliver both the business transformation of BBC Scotland and the transformation of our relationship with our audiences.
Why, in that case, is people development being cut back?
As far as human resources is concerned, we are considering putting in a critical mass in respect of training. We will analyse all our training schemes—at the moment, we have different levels of training schemes—and we will bring in bespoke training across the whole organisation. The HR reductions are post reductions, but the greater portion of those posts are being outsourced. Much of the HR processing is being outsourced.
Some of the training posts will be outsourced, rather than got rid of. We are capitalising on commercial providers who can do a better job because they do it more regularly, but our commitment to training remains. We spend £1 million a year on training; that will remain the case.
Surely the training budget will have to increase if you are asking for journalists to be trained not just in journalistic skills, but in camera skills—
Yes, we are, but our commitment to training is still there.
Will not the budget therefore have to be increased?
Yes—it may have to be increased.
We have already announced the establishment of a journalistic college and we are involved, across the nations and regions, with a project called sonar, which is all about the transfer and sharing of knowledge and skills across the organisation. Those projects have strong involvement by BBC Scotland's newsroom, both on the steering groups and in ensuring that delivery of the training schemes is what we require and is specific to our need.
The third area that I mentioned is health and safety. I understand that health and safety will now be the responsibility of the individual journalist out on the road in his or her car, trying single-handedly to film a story, edit the story, send it back for broadcast and get back to base. In such circumstances, can health and safety be managed as effectively as it is at present, when it will almost certainly be the horrid last thing for which a journalist wants to be responsible?
I will answer that question in two parts and will deal first with health and safety. Traditionally, health and safety has been the province of HR and has sat in HR. There will still be some HR involvement, but we want to move towards a coaching model whereby we ask the senior managers in each area to take absolute responsibility for health and safety in their areas. Responsibility will lie with them and there will still within the organisation be a very strong and specific resource in respect of health and safety. We will retain health and safety expertise in Scotland in addition to being able, in specific circumstances—such as when foreign travel is undertaken—to call on specific expertise from London when that is required.
It is already the case that journalists take some responsibility for health and safety assessments. On whether more than one individual is sent to cover a story, we make an assessment of the circumstances, the element of risk and other factors. We might send one person or we might send two, three or four people. We send as many people as we need to send; that will continue to be the case. There will be no exemption from health and safety requirements for people who work as video journalists.
It seems to me that in those fields you want more work from fewer people and are saying that you can do that effectively and efficiently, which suggests to me that you are suggesting that your staff are not currently working at their full capacity—they are not working hard enough. If they are working at full capacity and you are getting the best out of them, how can you possibly get them to do more work in more areas, with less back-up but for the same amount of money?
We are not suggesting that staff are not working hard enough. That has never been the suggestion; we have tremendously hard-working staff. What we suggest is that with simpler processes, which can be established through removal of some of the administrative burden, we can achieve the desired skills base among staff by investing in the training to which you referred.
I will make two additional points. One of Chris Ballance's concerns may be that every journalist will work that way, but such is not the case and it is not our plan. We think that a finite number of journalists will work in this way.
Video journalists will film, edit and write stories. Can you clarify that you think that someone who does those three jobs will be as good at them as would a specialist in one of the three areas?
Our ambition is that in three years they will be as good and as well trained as specialists and that the product will hold up admirably, although that is not to say that video journalism will be suitable for every situation. In Scotland, we are taking a pretty cautious approach in respect of the level to which we want to introduce video journalism. We want to increase our capacity to acquire stories, so we want more gatherers of stories. Camera technology is largely following radio technology. When I started in the organisation, it was common for a journalist to go out to record for a radio programme with a sound recordist, but that is no longer the case. The technology will develop, but what is really important is that we do not adopt video journalism as a universal solution for all stories and in all situations. Video journalism extends our capability to gather stories, but we have to use it in the right place, at the right time and with the right level of training. If we are sensible in the way in which we approach that process, I am confident that we can maintain quality.
Will video journalists do all the work? At the moment, a bi-media journalist will report on television and radio. Will a journalist who films, edits and writes a story have the time to file for both radio and television?
They will not in every case have that time because people have different levels of aptitude for different kinds of technology. We will not approach the question on the basis that we seek a one-size-fits-all solution. We will adopt a flexible approach, which will require greater flexibility on the part of the journalists who work for BBC Scotland and, to be frank, on the part of management, too. We will not impose a rigid formula on the way in which staff journalists should work.
I accept that technology is advancing at a great rate. However, my understanding is that ITN tried using video journalists but abandoned that approach because it decided that it could not get the quality that it needed. Does Mr Jenkins agree with that?
One of the limitations that might have affected ITN and other broadcasters is that they are very much on-the-day news services. We are aware that video journalism has a limited application for turning around stories on the same day. It is of greatest value to BBC Scotland in regard to pre-planned stories.
The committee is obviously considering the BBC's internal reviews in a broader context, which will be touched on in subsequent discussions. We have a wide interest in the future not just of broadcasting but more generally of the creative industries and Scottish culture in its broadest sense. Will the panel try to paint a picture of the wider impact that the current changes in BBC Scotland will have on Scottish broadcasting, the creative industries and Scottish culture? How does the panel see BBC Scotland's role changing in that regard in the years to come?
BBC Scotland's role will be transformational in that we will make access to participation in the creative process as open as possible for people who are advantaged and people who are disadvantaged in society. We will use our skills to mediate and to moderate individuals' ability to contribute by producing content themselves. User-generated content is expected to be an important adjunct to our output.
You used the phrase "critical mass", which has been used quite a lot already. One area in which the BBC has in the past provided critical mass is training. We have touched on that, but I am not sure how fully we explored the impact of the potential changes at the BBC on training in Scottish broadcasting and the creative industries in general. We look to the independent production companies to play a greater role in the future, but many are made up of people who were trained in the BBC.
Skillset, which is the sector skills council for the audiovisual sector, is finalising its draft sector skills agreement for the audiovisual industries in Scotland. Skillset works with Channel 4, the independent sector, SMG and the BBC, and has also built up a good relationship with the academic institutions. Last week, the Scottish Qualifications Authority launched two new qualifications: a higher national certificate and a higher national diploma in production. We are trying to ensure that people who have skills can move around in the industry. We seek to collaborate within the industry to ensure that it operates as a free market and that people can move from one organisation to another at a standard that we all accept. We are working hard on that, and I am proud to be associated with the work that Skillset is doing.
I understand conceptually what you describe and I am aware of the work to which you refer but—to consider the matter from the point of view of someone who has gone through one of those training courses and is looking for employment opportunities and on-the-job training—it strikes me that there is something to be said for a larger multidisciplinary environment within which people can move around and work in different areas. That is not comparable to the model that you described. I do not regard it as an either/or situation, but to what extent will such a training environment still be available at the BBC in the future? Will you quantify how that might change?
I do not think that the training that we provide will change. The providers might change and some training might not be provided in-house any more, although much of it will be. We endeavour to work with the industry to ensure that the BBC continues to be at the forefront of training for the industry.
Good afternoon. I welcome the Enterprise and Culture Committee's inquiry, as I have expressed alarm at the extent of the job cuts and think that there should be scrutiny of the process on which the BBC is about to embark. Many of my questions have been covered, but I want to home in on the question of quality and output. We know from press reports and briefings that 42 people will be made redundant in news and current affairs, but you have stated that you can absolutely guarantee that quality will remain the same. How did you arrive at that figure? How do you know that you will be able to maintain the same quality while losing 42 jobs?
We arrived at the figure after a lot of consultation and work over the past two years to improve our processes and determine where we could take a post reduction while maintaining quality. That work was done in consultation with the relevant managers, who know their output and areas well, and also took ideas from staff.
You are talking about guaranteeing the current quality of output.
Yes.
Surely, given the investment that the UK-wide BBC is making into the move to Pacific Quay, you should be guaranteeing an improvement in quality.
I think that I said earlier that my ambition was to improve quality and to extend and deepen our services, rather than simply to hold where we are. That is the purpose of investing in the technology that we are putting into Pacific Quay. It is not just a matter of technology; as much as anything, it is about the culture of the organisation, about people working together, about better ways of working and about simplifying the process and removing some of the bureaucracy that can build up in any large organisation.
What companies or broadcasters have tried and tested your model? Can you point to any evidence that suggests that what you are seeking to achieve is not just a hope or, as you called it, an ambition?
For the past year and a half, 200 staff from BBC Scotland have been working at what we call our futures project, the results of which have been published in a 150-page document with a number of the ideas, principles and processes that were involved. As part of our transition to Pacific Quay, we have invested significantly in a piloting process in which each idea will be owned, sponsored, piloted, checked and assessed for quality and cost. As a result, we have a very strong matrix of measures that we can consider with regard to each of the efficiencies that we propose to introduce. I should stress that these will be off-air pilots, and over the next two years we in BBC Scotland will work towards their introduction.
Everyone understands that moving to a new studio will mean a certain amount of changes and one would expect some improvements with new technology and equipment.
Before I pass over to Blair Jenkins, I should say that one question is whether the creation of local and regional services will diminish the quality of the national service. Delivering a quality national service through "Reporting Scotland" is at the heart of our work.
Exactly, which is why I am asking whether we will notice any change in emphasis.
I do not take your point about the English regions, because Scotland is bigger. In any case, I imagine that "Reporting Scotland" will have a richer diet of stories, but Blair Jenkins will provide some detail on that matter.
To use Pauline McNeill's phrase, I think that the only change in emphasis in "Reporting Scotland" will occur as a result of our enhanced ability to cover stories from every corner of Scotland. Even for an organisation as well resourced as the BBC—and I have worked in less well resourced broadcasting environments—it is sometimes difficult to get to stories in every part of the country. If we get the scale of investment that we envisage for our newsgathering infrastructure around Scotland, a camera should be at any story in Scotland within half an hour. That will greatly improve our ability to get items on air that even we struggle to get on air at the moment because of the length of travel time from our nearest base or crew.
I just want to be clear. You are saying that more local stories will be covered. Wanting to cover every corner of Scotland is a respectable and desirable position to take, as every corner of Scotland should be covered. However, there is a big difference between striving for that and changing the balance between national and local news. That is what concerns me. I do not think that people want to move to what can be seen in regional news in England. People want to see stories of national interest, whether they are about the north or the south of Scotland. Can you make it clear that there is a difference?
Every day in Scotland there are key stories that absolutely have to be covered because they are part of the national agenda. We will never diminish our coverage of such stories, which will continue to be very important. To give you a recent example, there was some discussion in the Parliament about a dentist in Stranraer. Currently, it is difficult for us to get to that kind of story very easily, but if we had a camera based in Stranraer, we could. The scope to illustrate national issues and debate from all over Scotland will grow for "Reporting Scotland" during the next few years.
I have a couple of final questions on the role of independent companies. At the moment, there is a 25 per cent quota for production by the independents. Based on the latest figures, how many companies have been involved in production in the independent sector? Are those genuinely indigenous Scottish companies or are they London-based companies with a Scottish badge?
I would like to come back to you with an accurate figure for the number of companies involved. The position changes quite rapidly, so we will get back to the committee with that information.
Is there any evidence that, during the past eight years, the introduction of the 25 per cent quota has contributed to the expansion and creation of an indigenous independent sector in Scotland, other than Wark Clements?
Absolutely. At its peak, Wark Clements's share of independent business was 8 per cent of total independent business in Scotland. Some companies are fantastically strong, such as the Comedy Unit in Glasgow. It delivers "Still Game", which is in the final of the golden rose competition, and has delivered programmes such as "Chewin' the Fat". "Still Game" will shortly appear on the network on BBC2. That company is carving a specialist area for itself.
It would help if you could follow that up with the background in writing. People take a lot of convincing that the system helps to grow indigenous Scottish companies rather than simply providing work for subsidiaries of London companies.
We can produce a short paper that will show that. The number of companies from which we commission has been as high as 40-odd in the past. However, I would like to see the specific figures before passing them to the committee.
Great. Thank you for that. Members have no more questions, so I thank the witnesses for their written and oral evidence. We will consider our views and how to proceed later today.
I will start. It was interesting to hear the BBC management in Scotland talking about the greatest period of change and exciting possibilities. I agree with the first part of that, but I am less sure about whether the trade unions agree with the second part.
It was quite difficult to hear exactly what was being said by the BBC witnesses, but I think that I heard them say that there were negotiations going on. As Luke Crawley has made clear, there are no negotiations going on. We also heard from the BBC witnesses that, on the one hand, they are open to negotiation—indeed, that is in the BBC's written submission—but, on the other hand, the 13.5 per cent cuts are non-negotiable and have to be implemented. We also heard the BBC witnesses say that they would increase online services, although in fact they are proposing a 15 per cent cut in online services. They also said that they would remove administrative burdens from programme makers, but the reality is quite the opposite: programme makers will have health and safety, human resources and finance functions added to their current tasks.
I find it difficult to believe that the BBC can claim that 13.5 per cent cuts will not affect the quality of programmes. That could be the case only if, as has been the case in the past, the BBC is running totally inefficiently, and I do not believe that that is the case at present. I believe that the cuts will have a serious effect on the quality of both audio and visual programmes. Based on my experience as an industrial officer outside the media, I also believe that job cuts of 13.5 to 15 per cent will lead to redundancies. Redundancies lead to low morale, because the people who are left have to pick up the slack and, in many cases, they do not have the scope to do so. Redundancies also lead to the use of outside contractors. In my experience, the use of outside contractors has resulted in a serious drop in skills. The level of cuts that has been proposed by the BBC gives us serious concern.
I wanted to pick up on that final comment, which was about the level of morale. The submission from the Voice of the Listener & Viewer states:
The cuts that were announced in March have affected staff morale very badly indeed, although they were heavily trailed in December, when the director general said, "I've had a great idea. I want to sack a lot of staff and save a lot of money." The details came in March, and the wait was nearly killing people because there was a lot of uncertainty and they did not know whether their jobs were directly affected, whether their jobs would be outsourced or whether they would be made redundant. When the announcement was made in March, a certain amount of detail was provided that indicated some areas that were directly in the firing line, particularly for outsourcing and for sales—
I am sorry to interrupt, but we have a technical problem with the sound. I have to suspend the meeting for five minutes until we have sorted it; otherwise your evidence will not be on the record, and I am sure that we all want to see you on the record. However, this is the Scottish Parliament and we have hospitality, so we will offer you a cup of coffee while the meeting is suspended.
Meeting suspended.
On resuming—
I reconvene the 10th meeting in 2005 of the Enterprise and Culture Committee. I point out that the BBC is responsible for the sound inside the Parliament. We have never had problems with the sound before, so the timing of today's incident is absolutely brilliant.
I was picking up on Mr Parker's comment regarding morale. In the next panel, we will hear from the Voice of the Listener & Viewer. Its submission states:
The main effect is that staff morale has plummeted. There was a great deal of uncertainty between December, when the cuts were announced in outline, and March, when some of the detail became clear. One problem is that the BBC was in such a hurry to begin managing the cuts that it started asking people whether they wanted to volunteer for redundancy. As I pointed out, in our view one difficulty with that approach is that it is unreasonable to ask staff whether they want to volunteer for redundancy—which some staff might well wish to do—when the bigger question is whether staff want to volunteer to remain in an organisation with 20 per cent fewer people. That dilemma has had the biggest impact on morale. People find it hard to conceive of what their job might be like with 20 per cent fewer staff. With such a bleak prospect, people are very depressed.
With 195 job losses being imposed on BBC Scotland, the cuts present staff with the prospect of choosing either to work harder or to make cheaper and inferior programmes. Given that we were already carrying out risk assessments for stress among staff, the prospect of 20 per cent staff cuts and budget cuts could have a serious effect on health and safety and an enormous effect on staff morale at BBC Scotland.
I am conscious of the shortage of time after the suspension, but I do not want to cut Chris Ballance short if he has another question.
Do the witnesses accept that new technology and new developments leave room for reductions in staff or expenditure?
Like the convener, I am conscious of time. The unions at the BBC have a long history of embracing new technology. Often, it has been difficult to embrace new technology and there have been protracted discussions and arguments—and, occasionally, disputes—about how new technology should be implemented. However, our approach has never been to say, "We can't have new technology here." That is as true for PDP as it is for any of the other things that have been talked about this afternoon.
The key issue—which has been picked up—is that people will be doing their own research, their own filming, their own writing, their own editing and sometimes their own health and safety with 15 per cent less budget. If they were given a violin as well, they could probably write the music to accompany the piece that they are working on. New technology can add. We have agreements on PDP in places; we are not against PDP if it adds to what the BBC does and provides additional services. People work very hard to make it work in the best way possible, but it is not a substitute for the high-quality, high-standard programming and filming that exist.
New technology is only as good as the people who use it. It has been my experience that when cuts in the order of 15 per cent are made, the training budget is one of the first things to go.
My question follows on quite neatly from Chris Ballance's question. The concept of efficiency savings is well known in the private sector and is becoming better known in the public sector. Is it your position that there is no scope for efficiency savings or are you just not happy with the way in which the BBC is going about making savings and with the scale of the proposed cuts? If you think that there is scope for efficiency savings, would you like to hazard a guess at what a realistic saving might be?
As I have said, the union position is not that it is impossible to do things more effectively and efficiently but that the prime consideration must be whether the BBC is maintaining or improving its standards. At the moment, that is unclear to us. We suspect that, as they are presently framed, the cuts will mean that worse product goes out on air.
We strongly support the idea of the BBC delivering value for money. It is essential that it does so, because that is what gives us the weapons to be able to go out to the public and justify the licence fee, the continuation of the charter and so on. Value for money is important, but we do not agree with some of the proposals, such as those on reducing the number of checks and the elimination of double and triple checking. The Hutton report and the Neil report that came out after it concluded that in some areas there should be more editorial checks, to ensure that quality and standards are maintained. We endorsed that view and accepted the Neil report's recommendations, but the changes that are being made appear to reverse that approach. Value for money is important, but we do not think that the proposed cuts will deliver value for money for licence-fee payers or for BBC staff.
In the opening paragraph of its submission, BECTU makes a rather apocalyptic prediction:
We refer to two factors. We have talked about the quality of programmes, so I will not labour that point. The other area in which the proposals are astonishingly damaging is content acquisition—I refer to the idea that the BBC does not need to make the programmes that it broadcasts. As we know, there is a 25 per cent independent production quota and the BBC has accepted that that quota should be sharply increased. The director general has said that the BBC currently employs enough staff to make 75 per cent of its output, but that staff numbers should be reduced until the BBC can make only 60 per cent of its output. That represents a de facto increase in the independent production quota to 40 per cent.
You mention a figure of 50 per cent and the same figure appears in the NUJ submission. Is that some kind of cut-off point or magic figure? If in-house production were to fall below 50 per cent, could we still justify continuing to fund the BBC through the licence fee?
The BBC is a public service broadcaster. If it does not make the majority of the programmes that it broadcasts, its existence as a maker of programmes will start to be in question; it will be more publisher than programme maker. The 50 per cent figure represents a psychological tipping point—I think that that is the jargon. It would be dangerous for the BBC to go below 50 per cent. We do not know whether it will do that, but it is inflicting serious wounds on itself by accepting a 40 per cent quota for independent production. Who knows what the Government—whatever its political persuasion—might do after the general election? The Government will have to address the white paper that will govern charter renewal and it might decide to set a 50 per cent quota. We do not know what will happen, but it seems to us that the BBC is inviting in the enemy by accepting a 40 per cent quota. That is a dangerous path to take.
Will Mr Dear or Mr Parker comment on that point, particularly in the context of the charter that will follow the one that is currently under review?
The BBC is far too defensive about what it does. It is the greatest public service broadcasting institution in the world. Everywhere else in the world, the BBC is rightly praised for the quality and standard of what it does. The range and scope of what the BBC currently does is unsurpassed, and we get all that for a £126 licence fee. Sky charges £19.50 a month for a basic package, with much less original production, much less in-depth coverage and no proper children's programmes without adverts. The BBC could make a much stronger case for itself, justifying a higher value and, possibly, a higher licence fee. The problem is that, if it becomes defensive, reduces what it does and starts to make programmes of a worse quality, some people—including those in the tabloid press, some politicians and commercial rivals of the BBC—will say, "BBC3 makes rubbish programmes. No one watches them, so why should we pay for them?" That argument will be used to undermine the licence fee.
I have one final point to make. Mr Crawley said earlier that, under Greg Dyke, things seemed to be going reasonably well. By your assessment, there would have been no need for the cuts if Greg Dyke had stayed, but Mark Thompson took over and we know about the events that intervened. Does any of you feel that the cuts are politically driven—that there is some kind of defensive nature to them, as Mr Dear said? Are they, to some extent, a reaction to the considerable amount of flak—perhaps that is an inappropriate analogy to use—that the BBC took as a result of the way in which it was reported to have covered events surrounding the war in Iraq? Has a defensiveness following that led to many staff facing losing their jobs?
You could argue that there is a political dimension to it. When the Hutton report came out and was followed by the resignation or dismissal of the director general and the chairman of the board of governors, the reaction of the public was to say strongly that the Government should not interfere in what the BBC does. The Government backed off, but there was no longer a chairman of the board of governors or a director general, so the Government—naturally, as it does—had to appoint a new chairman of the board of governors. That chairman of the board of governors then appointed a new director general, Mark Thompson. You can draw your own conclusions about what has followed, which has been the kind of thing that the Government would have liked to do but could not do because the public clearly valued the BBC so much.
In their evidence, Blair Jenkins and Ken McQuarrie made it clear that, over the next three years, 42 posts could be cut from BBC Scotland news and current affairs without that having any impact on the quality of the output. Do you agree with that? If you do not agree, what impact do you think that those serious cuts will have?
When Mark Thompson made his announcement about the cuts across the whole of the BBC, he talked repeatedly about attacking bureaucracy; he said that the cuts were about sweeping away bureaucracy in the BBC and investing more money in programme making. In reality, if one considers the posts in Scotland that are to go—15 in BBC interactive, 42 in news and current affairs, 19 front-line posts in radio, 15 in TV, 6 in resources, and so on—one can see that the cuts are not about sweeping away alleged bureaucracy but will impact directly on programme making.
To pick up on a couple of those points, it is clear that the number of journalists and production staff working on a programme has a huge impact. Moreover, BBC Scotland is making cuts in some resource areas. Part of the argument about the PDP experiment in England and elsewhere was focused on quality. There is an assumption that just about anybody can be given a camera, told to point it at something and then will bring back pictures to be edited. It does not work like that. If quality pictures are required, a quality camera is needed—DVD cameras and the pictures they produce are not of high quality. It also takes time to pick up the skills to be able to shoot pictures and to extract quickly from that enough quality footage to make a broadcast.
Blair Jenkins suggested that PDPs are currently used to gather footage for "Reporting Scotland" and there have not been any complaints. I have seen footage that a journalist summed up as being almost equivalent to what one would see on a wedding video. However, if such footage is being used on "Reporting Scotland", it has not been noticeable. Why does there appear to be a difference?
It is difficult to say why there is a difference. The question depends on what pictures we are talking about. When we were arguing about safety and quality of output, we compiled a showreel of material that had been broadcast in England. Apart from some of the astonishingly dangerous things that were being done—a person leaning off the back of a motorbike to get pictures without wearing a harness and so on—some of the material was framed so badly that the reporter's head was barely in the picture. I find it difficult to believe that it could be broadcast without generating complaints.
I have with me a copy of a complaint about PDP and video journalists from the BBC Scotland video journalist team. It reads:
My concern is that it might be okay to use such journalism and camera work for occasional pieces on an ad hoc basis in far-flung parts of the country to which it is difficult to get a full crew in a short time, but once people's standards start to be lowered, they will, as people always do, simply accept what they receive and there will be a gradual slippage into more such journalism.
I am not sure that we would agree, as it does not seem to us that there was good news. Ken MacQuarrie could not give a clear answer about independent production and whether a huge amount of Scotland-based independent production will be generated. I think that only three Scottish independent production companies make the top 150 United Kingdom independent production companies. Some of the more famous apparently Scottish products—such as "Monarch of the Glen"—are made by English rather than Scottish companies. If all the new money—and, to be blunt, some of the old money—was definitely going to be spent in Scotland, that would be good news for Scotland's creative industries, but there are no guarantees that that will happen. There are no guarantees that there will not be a brass-plate operation and that the only thing to do with programmes being made in Scotland will be the sign at the end of them that says "Made by BBC Scotland", although the programme might have been resourced and the production process might be owned by a company that is not based in Scotland. Therefore, I disagree with the First Minister's view. It is possible to assert that the BBC will spend much more money in future in Scotland on independent production companies that are based in Scotland, but the proof of the pudding is in the eating and I am not sure that there has been much money in the past. I cannot be certain whether past performance is a guide to the future but, from where we are standing, it does not look as though there will be much more money.
I will not agree with a statement that could result in job losses.
I think that Susan Deacon has a question.
The points that I was going to raise have been covered.
It is profoundly depressing that industrial relations in the BBC are at such a low ebb that the two sides should come here to air their dirty linen in public. As the collective voice of the staff, with all their capacity, knowledge, experience and creativity, can the witnesses tell us that they have tried to help the management to implement efficiencies and that their attempts have been rebuffed?
I agree that it is a sad day when we must come to a committee such as this to air our differences in public, but if you are interested in what is happening to us, it is appropriate to ask us questions about that. It can be hard to see exactly why we are here, but we have tried and tried again.
My question relates to a comment that Mr Parker made about the need for more rather than less training. Do you accept the argument that, for years, the BBC has trained staff to a very high standard, that other broadcasters have not so much poached them as taken advantage of the situation, if I can put it like that, and that that is no longer a reasonable basis on which to spend a large amount of taxpayers' money? There is potentially an opportunity for the sector skills council, further education colleges and other training providers to do some of the basic training that has, heretofore, been done almost entirely by the BBC. That would produce a saving in the corporation's basic training budget and put the onus for training back where it should be: on the colleges, training providers and other employers.
The issue is who pays for training. In one sense, it is right that there has to be a role for training that is provided separately from the training that is provided by the BBC. However, it does not seem to me that it is a good idea for the BBC to say that it will dismiss or sack the staff and outsource significant areas of training. Staff who have been trained by the BBC are poached because it trains them to a very high standard. The experience of BBC employees who become our members is that they have had training outside the BBC but that the BBC generally wants to give them further training so that it makes them exactly what it wants.
Christine May used the appropriate word in her question: "basic". Colleges are limited in what they can teach. We tell our apprentices at the end of their apprenticeship that they had better be prepared to be retrained every five years, or modern technology will overtake them. In many industries that I deal with, the best training that people get is what they learn on site. For example, when an Amicus member who is an electrician starts with the BBC, he will probably spend his first six months learning the specifics of the electrical work that is required within the BBC, even though he might be a highly qualified, time-served electrician. Given the specialist nature of the work, the onus is on the industry and the BBC to train people. I cannot think of a college in the west of Scotland that would train a BBC person in the specific skills that are required by the BBC.
That covers all our questions. Thank you very much for your written and oral evidence, which has been helpful.
I am a lecturer in media policy at Napier University. On this occasion, however, I am speaking on behalf of VLV, as the board member in Scotland. Jeremy Mitchell was formerly the commissioner for Scotland of the Broadcasting Standards Commission and was also chair of the Scottish Advisory Committee on Telecommunications. We have a few brief points to make in addition to those that are contained in our written submission.
The BBC is offering listeners and viewers an odd equation. On one side of that equation, we have the 13.5 per cent staff cuts, which seem to be set in concrete by London. On the other side, we have a public commitment by the director general of the BBC to produce more and better quality programmes. My understanding of what he meant by "quality" is that it relates not so much to technical quality, which was referred to earlier, but to that elusive concept of programme quality. When he talks about "better quality programmes", he is not talking simply about safeguarding the existing quality of programmes. From the viewer and listener viewpoint, we welcome a commitment to diversity and quality in programming. Where there seems to be a big black hole is in relation to how one solves the equation of a substantial staff cut and an improvement in the quantity and quality of programmes.
Thank you. That was very interesting. Do members have questions?
One of my main concerns, which came through clearly in the evidence that we received from the trade unions, is about the quality of the service that we will receive from BBC Scotland, particularly in news and current affairs, if the proposals are implemented. The BBC has supported its argument for some of the changes by saying that part of the cost saving that will be generated and put back into the BBC will allow it to develop a local news programme. The public stated that they wanted such a programme in a survey back in 2003.
To be fair, we have had support from people in the BBC's senior management who come to speak at our conferences, where they encounter members of the public and, rather like what happens at Prime Minister's question time, they have to make themselves available to answer questions on the spot, as Michael Grade did yesterday. There are plans to try to develop new trust in the future, under the BBC's new governance structure. There is a possibility, as yet unspecified, of new mechanisms for trying to assess the views of listeners and viewers. Beyond that, it is not a surprise that the BBC is coming up with such plans at the same time as the Scottish Media Group is coming up with its plans, not for a Scottish six, but for a Scottish news programme at 22:30. As ever, the BBC is being competitive.
As Susan Deacon did earlier, I would like to expand the discussion beyond news and current affairs. Although news and current affairs are important to us because they give us our publicity, if you like, the BBC is about more than that.
At this point, I have to say that VLV is a non-sectarian, non-political organisation and therefore we keep our distance from the BBC and the trade unions. We represent the voice of the listeners and viewers, so we have not engaged in such discussions.
I will rephrase the question. If I were to ask you to give the committee your vision of how the BBC might look to position itself in the market over the next 20-odd years, without dumbing down or becoming a tabloid-type broadcaster, would you have ideas? If so, would you be prepared to share them with us?
VLV's ideas would be along the following lines. Market failure is not the only way to try to define what one puts into public service broadcasting. In other words, our argument is that regulation, rather than being a hindrance to the creative industries, is the reason why Britain and Scotland have successful creative industries. We guarantee forms of investment through the licence fee in particular, and because of that guaranteed income, an organisation such as the BBC has what we might describe as creative headroom. That creative headroom, which insulates the organisation from the demands of the market—although not entirely; I make the point that we want the BBC to be efficient to some extent—enables it to produce enormous quality.
The BBC is in an immensely difficult strategic position, in that it has public service broadcasting remits to fulfil and has to compete in the broadcasting marketplace. That balance is extremely difficult to maintain, and there is a serious danger that, if the BBC's audience reach falls below a certain level, the justification for the licence fee will increasingly come into question in political circles. I hope that the BBC will receive open or tacit reassurance from the Government that its funding is secure, irrespective of its audience reach. As I said, the balance is extraordinarily difficult to maintain, but I hope that the BBC will not be pushed too far down the road of competing for audience share.
I will link into what Ken MacQuarrie said about BBC Scotland competing for the extra money that will be available and into what the trade unions said. Competition does not always lead to quality. What competition does the market provide for Radio 4 or BBC Radio Scotland, which are the great things about the BBC? There is no competition. They are so good partly because of the funding mechanism for the BBC. It is important that this discussion is taking place because we are all stakeholders in the BBC, which is a public corporation with a public interest—it is not just another company.
How do you gauge the voice of the listener and viewer, not necessarily on this matter but in general?
We have more than 16,000 members and our annual conferences—we have had 10 annual conferences in Scotland—are attended by young people as well as older people. We are sometimes described a little unfairly as the voice of the Radio 4 listener, but our membership is much wider than that.
I am a Radio 4 listener and I have never been asked for my view.
Indeed it is. Not only that, but we made a submission to Ofcom on the proposals for broadcasting in Scotland. If it so wishes, the committee may have that submission, which concerned SMG and provision in Gaelic, which the committee might wish to consider.
I will come to a question on Gaelic later.
That takes us into a discussion about the relationship between BBC values and the independent sector. The BBC has a culture and a tradition that have been built up over many years, rather like the Scottish regiments, which is another issue. We can throw that culture and tradition away, but it takes time to inculcate them, and we want journalists who show a commitment to due impartiality and balance. For a university student who is doing a journalism course simply to be told what due impartiality and balance might be is no substitute for their gaining experience over time in front-line reporting, such as the reporting that Brian Taylor does on the activities of the committee and the Scottish Parliament.
Yes, although I am not sure quite how. I suppose it leads us into a discussion about what happened in the Hutton-Gilligan case, but that is not what we are here for.
I might be able to help. One of the arguments that was made about the Hutton-Gilligan-Kelly affair was that the BBC had moved away from reporting what was going on and had become a policy actor. It could be argued—this is one of a number of different analyses—that Mr Gilligan stepped over a line that he should not have stepped over, as a promoter of BBC values. Perhaps more staff development and training for Mr Gilligan might have helped to avoid that problem.
I will not push that point any further, but I will push my luck a little, as you mentioned Gaelic broadcasting. Although it is not central—in fact, it is peripheral—to the discussion that we are having today, I notice that both Ofcom and the Scottish Media Group mention in their submissions the idea of a dedicated Gaelic channel, ideally to be introduced at the time of digital switchover. In last week's debate on the Gaelic Language (Scotland) Bill, I called for greater resources for Gaelic broadcasting. My interest in the issue might not be shared by other members of the committee, but will you comment briefly on VLV's views on the matter?
I have with me a copy of VLV's submission to Ofcom, which includes a section on Gaelic broadcasting. On the proposals that have been put forward by Ofcom and SMG, we state:
That concludes our questions. I thank both witnesses for their written and oral evidence, which was interesting.
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Ofcom Review