Anne McElvoy TV is going through an evolutionary leap and the BBC must adapt fast
ACONSULTATION mounted by a public broadcaster is a Trojan horse. Those who send it cantering into battle know what’s inside it and the likely effect. In the case of the latest one on whether the BBC can continue to fund licence-fee exemption for over75s from 2020, everyone knows that it cannot. So as the deliberation period ends this week, the real purpose has been to shape the terms of retreat. Neither, for all the solemn scolding of Gordon Brown, will the Government restore the old level of subsidy — and if it did it still would not be the solution.
It is doubtful that the former Labour Prime Minister and Chancellor would accede to the demand if he were in power now, because the terms of debate about how to sustain a public service broadcaster have changed, as have the arguments about demographic fairness well beyond the BBC. Decades of transfers to the elderly have left the young at the raw end of what wonks call “inter-generational accounting” when it comes to largesse from the state.
Hard maths will determine where this case ends up because the value of the concession has risen so starkly since the Labour government in 2001 introduced it and will continue to do so as the population ages. The external economic study commissioned by the BBC shows that if it were to be continued after 2020, the number of those exempt from the licence fee would cost the BBC £745 million, or 18 per cent of its current expenditure — and more than the whole amount spent on all radio output in 201718. “By 2029-30, we estimate that the annual concession cost will rise to £1.06 billion,” says the projection. But this is in the realm of science fiction, so something else will happen instead.
You can certainly argue with the scale of this transfer of liabilities in 2015 by the Government (I did at the time). But no Chancellor now would take back responsibility for the concession in anything like full measure. In part, because the promised “end of austerity” will mean major cash injections for housing and public services and plugging gaping holes in council budgets. Any relief for the BBC will be minor and probably in the area of supporting the World Service, for sound reason, given the staggering amounts of disinformation doing the rounds.
So the consultation looks a lot like softening up older viewers for a decision which will mean a good chunk of them will be adversely affected from next year. It always sounds heartless to remove concessions which people have come to accept but this is the price of politicians promising free stuff when they will no longer be in office to stump up for it. It is too hard and especially unfair to means-test according to l eve l s o f pension tax relief because, as Age UK points out, two-fifths of those eligible for this do not claim it and that hits many, including the neediest or most isolated. My guess is we will end up with a compromise, in which the qualifying age for a free licence rises and the value of the subsidy falls, to reduce the cost.
More sweeping changes will, however, be necessary to allow a national broadcaster to withstand challenges from US-based competition and changes in viewing habits, whichever behemoth of the Netflix, Disney or Amazon variety is in the ascendancy. This disruption is not an idle threat — you and I were probably watching one of them on the commute.
If the BBC is to sustain a role of “national champion” in broadcasting, it cannot simply be at the mercy of the push-me-pull-you of giveaways and takebacks of a levy that is funding threequarters of its work. You can see the reality in the Darwinian struggle to prevent its brilliant natural history programme makers decamping to Netflix in t h e w a ke o f S i r D av i d Attenborough. Privately, many senior insiders at the Beeb feel the greatest living Englishman’s latest paean of praise to Netflix — “It’s over 200 million people, it’s urgent, it’s instantaneous. And it stays there for months” — came across as a tad ungrateful.
Looked at pragmatically, if a figure as old-school BBC as Attenborough openly talks this way about its main rival, it’s time to wake up from the dream that the corporation is immune from external shocks. Technology will reshape how broadcasting is run and funded far more ruthlessly than decades of political argument about how big or small the BBC should be. The new race to head Radio 4, for example, needs to figure out fast how a station struggling to replenish audiences relates to the BBC Sounds app, which is sort-of an iPlayer and sort of a podcaster, and thus risks satisfying neither brief.
When it comes to television, where the financial stakes are far higher, I doubt that the BBC can retain impact and high standards unless it is prepared to charge for streaming potentially lucrative services — bringing in new revenue in the UK (as it is starting to do in the US).
A future-proof charter is more likely to end up constructed around a “core” BBC of news, current affairs and a selected offering of other shows, available for a subsidised, reasonable licence fee but topped up by putting a market price on more of its wares. A hopeful scheme would see pan-European broadcasters sharing content (though there is only so much of Spiral and Scandi-noir that will attract audiences at scale).
But it probably will need bolder remedies and the odd thing is that the answer has been hidden in plain sight. The BBC’s best chance of preserving its status, advantage and quality is to deploy its content more effectively. Crosssubsidising parts of broadcasting the market alone will never support.
Te l e v i s i o n , a s S i r D a v i d m i g h t reverently observe through his binoculars, is in t h e mi d s t o f a n evolutionary leap. Loved, respected and worth preserving, the BBC cannot escape it but it can start to figure out how to win in the new world. It’s far wiser to be on the side of the adaptive species than left behind at the emptying watering hole.
⬤ Anne McElvoy is senior editor at The Economist
This is the price of politicians promising free stuff when they will no longer be in office to stump up for it