Policy Paper on BBC Charter Renewal (September 2016)

Executive Summary

This paper sets out the Scottish Government's policy position on the renewal of the BBC's Royal Charter, following the agreement of a Memorandum of Understanding between Scottish Government, Scottish Parliament, BBC and UK Government, which gives Scotland a formal role throughout the process of Charter Review, implementing the recommendations of the Smith Commission in this area.

This policy paper has been updated to reflect the publication of the UK Government's white paper on BBC Charter Renewal in May 2016 and underpins our negotiations with the UK Government on the drafting and implementation of the Charter and the Agreement.

The Scottish Government's policy is founded on the following three objectives:

• To empower BBC Scotland to address the concerns of audiences and deliver better outcomes from audiences, including more representative content across all outputs.
• To ensure that the governance and structure of the BBC is more responsive, and that, by reflecting the changing devolved structures of the UK, is able to deliver similarly decentralised decision making.
• That through these structures the BBC is not only able to deliver better outcomes for audiences in Scotland but also implement commissioning and editorial practices which will support the growth and sustainability of Scotland's creative industries.

Section One - Charter Dependent Change

The key change we seek is a transformation of the BBC's governance structure to reflect the higher levels of devolution across the UK, and in particular to Scotland, following the Smith Commission. The paper sets out the implications of our key objectives, particularly the decentralisation of the BBC, for - governance, the financing of BBC Scotland and the creation of additional TV and Radio platforms.

Section Two - Non Charter Dependent Change

There are a range of issues which do not require changes through the Charter in order to be effected, but would still improve the services offered, and the social and economic impact of the BBC in Scotland. These include: the regulation of production quotas; news, current affairs and sport; listed events; commercial operations ( BBC Worldwide); indigenous language production ( BBC Alba); and Channel 4.

Section Three - Further Policy Issues

The final section provides an update on two issues within the scope of the BBC Charter process which were still under consideration when this policy paper was first published. With reference to the issue of the regulation of the BBC, the Clementi review has reported, and in relation to BBC studios there are now further details available which have helped to inform the Scottish Government's view.

Purpose

To outline the Scottish Government's Policy for BBC Charter Renewal and to identify any on-going strategic considerations on wider issues related to the BBC Charter where further input from stakeholders is required.

Background

The Scottish Government agreed a Memorandum of Understanding with the UK Government, the BBC and the Scottish Parliament, which sets out a role for the Scottish Government in the future of the BBC and ensures that the BBC will be held accountable to the people of Scotland through their representatives in the Scottish Parliament.

The MoU can be viewed at the following link -

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/469863/Scotland_MoU_-_final__signed.pdf

The Scottish Government is working with the UK Government and the other devolved administrations in Wales and Northern Ireland, to develop a new Royal Charter for the BBC, to be implemented by the end of 2016.

The UK Government published its policy position on the future of the BBC in May 2016 and it can be viewed here:

https://www.gov.uk/government/publications/a-bbc-for-the-future-a-broadcaster-of-distinction

Process

The Scottish Parliament (primarily through the former Education and Culture Committee) and Scottish Government have analysed the current delivery of the BBC in Scotland and formulated a consensus on the priorities which should be addressed through this Charter Review.

A motion on the principles underlying the need for a strong Public Service Broadcaster in Scotland, and the Scottish Government's policy on the BBC was placed before the Scottish Parliament in February 2016, allowing them to deliver their functions as set-out in the MoU. Following consideration by Parliament and the subsequent vote, the Scottish Government has been negotiating the content of the White Paper, which was published in May 2016. A further Scottish Parliamentary vote will take place once the Charter has been published.

Under the MoU this Charter will only be agreed once all parties are in a position to support the provisions it contains.

Stakeholder Engagement

The Scottish Government has refined its policy through engaging with a wide range of individuals and organisations involved in broadcasting in Scotland and beyond. Alongside a number of thoughtful, challenging and on-going conversations, we have hosted two open stakeholder events in September and December 2015.

Throughout this process there has been, and will continue to be, detailed discussion between the Scottish Government and the BBC. The BBC also gave evidence to the Education and Culture Committee of the Scottish Parliament in January 2016.

On-going Scrutiny

The Scottish Parliament and Scottish Government will have an on-going role of scrutinising BBC Scotland, both through the laying of Scottish specific financial and performance information and scrutiny of the implementation of the Charter once this is in place.

Vision For Charter Renewal

The Scottish Government's vision for the BBC through the period of the next Charter is founded on a recognition of the immense value of a public service broadcaster; indeed, the BBC is one of the most important and influential cultural, social, economic and democratic institutions in the country.

Our policy for Charter Renewal has been developed in the context of what we believe is required for the long term sustainability of the BBC both in Scotland and the wider United Kingdom. The Scottish Government is clear that the debate about the future of the BBC, and, indeed, public service broadcasting more generally, is of fundamental importance to the future success of any specific ambitions that we have for the BBC in Scotland. Overall, this policy position is rooted in the Scottish Government's commitment to public service broadcasting and ensuring the long-term sustainability of the public service broadcasting model, which is empowered to deliver high quality outcomes.

However, in order to maintain the important contribution which the BBC makes to social, economic, cultural and democratic life, we believe that some strategic changes are required:

• To empower and resource BBC Scotland to address the concerns of audiences and deliver better outcomes for audiences, including more representative content across all outputs and platforms.
• To ensure that the governance and structure of the BBC is more responsive, and that by reflecting the changing devolved structures of the UK, is able to deliver similarly decentralised decision making
• That through these structures the BBC is able to deliver better outcomes for audiences in Scotland and implement commissioning and editorial practices which will support the growth and sustainability of creative industries in Scotland.

The Scottish Government's policy proposals for BBC Charter are rooted in a long-standing policy position which has, at its heart, the principle that broadcasting policy should be fully devolved. In the absence of this current level of constitutional change, the BBC Charter process provides the opportunity to deliver elements of the policy vision for broadcasting in Scotland, which may eventually build towards a more significant level of constitutional change in this area.

BBC Charter Policy

This policy is set out in two sections. The first section concentrates on those areas where change is required through the BBC Charter process. The second section sets out those areas which do not necessarily require changes in the Charter and which could be addressed by the BBC at any time. Where there are key issues which require some further thought - these have been highlighted in the text. The Scottish Government welcomes feedback on this policy, and, in particular, the key issues. Details about how to do this can be found at the end of this document.

Delivering the Vision

Whilst at a practical level this vision is focused on budgets, governance structures and other components of the broadcasting and production system, this is with the intention of addressing the fundamental issue faced by BBC Scotland, which is its ability to produce high quality content which is relevant to audiences who pay for that content through the licence fee. Audience satisfaction figures in Scotland, produced by the BBC, illustrate that it is not currently able to fulfil this ambition - the vision of the Scottish Government is to use the process of Charter Review to address this fundamental issue.

At a practical level, the vision amounts to a re-structuring to bring the governance, decision making, editorial decisions and budget responsibility of the BBC into line with the devolved nature of the UK and give Scotland greater autonomy, whilst maintaining an appropriate and strategic link to the wider BBC. The activities of the BBC are not developed and delivered in a vacuum and we believe that a long-term strategic vision for the nations and regions is required if we are to see an improvement in audience satisfaction levels in Scotland, long-term sustained growth across Scotland's creative sector and the long term sustainability of the BBC more generally across the UK and internationally.

In this context, it is important to recognise that whilst parts of the policy relate to editorial control, the Scottish Government is very strongly committed to the editorial independence of the BBC. However, in presenting a case for the devolution of editorial control to Scotland, this is to ensure that appropriate editorial decisions can be made, in particular in relation to news and current affairs which accurately reflect the impact of issues in Scotland. Following devolution and to a greater extent as the recommendations of the Smith Commission are implemented, individual stories and issues will have a differential impact across the UK. For instance, in Scotland where there is devolved control of health and education policies, and elements of taxation it is critical that editorial control for coverage of these issues at a national and UK level is exercised in Scotland to maintain the BBC's reputation for high-quality and accurate coverage.