MINUTES OF THE BBC TRUST MEETING
Held on Thursday 21 October 2010 in the BBC Trust boardroom, Great Portland Street, London
Present: Michael Lyons Chairman Chitra Bharucha Vice-Chairman Richard Ayre Trust member Diane Coyle Trust member Anthony Fry Trust member Alison Hastings Trust member for England Patricia Hodgson Trust member Rotha Johnston Trust member for Northern Ireland Janet Lewis-Jones Trust member for Wales David Liddiment Trust member Mehmuda Mian Trust member Jeremy Peat Trust member for Scotland
In attendance from the Trust Nicholas Kroll Director, BBC Trust Unit: Phil Harrold Head of Secretariat and Governance Items 153 – 159, Kate Atkins Senior Adviser, Secretariat and Governance 160.5 – 167 Alex Towers Head of Finance, Economics and Strategy Items 153 – 159, Mark Wakefield Head of Performance 160.5 - 167 Items 153 – 159, Mark Devane Head of Communications 160.5 - 167 Items 153 – 159, Fran O’Brien Head of Editorial Standards 160.5 - 167 Items 153 – 159, Steve Pollock Head of Audiences and Marketing 160.5 - 167 Items 153 – 157, Jon Cowdock Head of Strategy 160.5 - 163 Items 153 – 155, Alison Bexfield Chief Financial and Compliance Adviser 161 Items 158 & 159 Alison Gold Chief Adviser, Performance Items 164 & 165 Gareth Barr Senior Strategy and Policy Adviser
From the Executive: Items 160 – 164 Mark Thompson Director-General Items 160.5 - 164 Mark Byford Deputy Director-General Items 160 – 164 Caroline Thomson Chief Operating Officer Items 160.5 - 164 Zarin Patel Chief Financial Officer Items 160.5 - 164 Jessica Cecil Head of the Director-General’s Office Item 163 John Smith Chief Executive, Worldwide Item 163 David Moody Director of Strategy, Worldwide Item 163 Anna Mallett Controller, Business Strategy Item 163 Roly Keating Director, Archives Item 164 Tim Davie Director, Audio & Music Item 164 Will Jackson Head of Strategy, Audio & Music Item 164 Alix Pryde Controller, Distribution
AGENDA
153 Chitra Bharucha and Janet Lewis-Jones
154 Minutes and matters arising
155 Committees and Audience Councils
156 Director’s report
157 Strategy review: draft conclusions
158 Television service reviews
159 Red Button service review
160 Director-General’s monthly report
161 Executive finance report
162 BBC One HD
163 UKTV update
164 Digital radio strategy
165 Items for approval
166 Items for noting
167 Business handling and communications
153 CHITRA BHARUCHA AND JANET LEWIS-JONES
153.1 The Chairman opened the meeting by thanking, on behalf of the Trust, Chitra Bharucha for her service as Vice-Chairman and Janet Lewis-Jones for her service as National Trust member for Wales. Dr Bharucha also served as Acting Chairman from November 2006 to May 2007. The terms of Dr Bharucha and Ms Lewis-Jones would end on 31 October 2010.
154 MINUTES AND MATTERS ARISING
154.1 The Trust approved the minutes of its meeting held on 23 September and its conference held on 29 and 30 September as accurate records of proceedings. The Trust approved the publication of the minutes with no redactions.
154.2 The Trust noted the matters arising from previous meetings.
155 COMMITTEES AND AUDIENCE COUNCILS
155.1 The Trust noted the reports from each of the committees and Audience Councils. The chairmen of each committee and council updated members on the major outcomes of their respective meetings.
155.2 The Chairman of the Editorial Standards Committee noted the publication of the new BBC Editorial Guidelines on 12 October 2010 following approval by the BBC Trust.
155.3 The Chairman of the Strategic Approvals Committee reported that Ofcom had announced that it would not open an investigation into YouView (formerly know as Project Canvas) under the Competition Act following complaints made by Virgin Media and IP Vision.
155.4 The Vice-Chairman provided an update on a recent conference held with the Audience Councils. During the conference members of the Trust’s advisory bodies, the Audience Councils for England, Northern Ireland, Scotland and Wales, had discussed issues around portrayal and citizenship.
156 DIRECTOR’S REPORT
156.1 The Director, BBC Trust presented his report, which provided an overview of activity undertaken by the Trust and previewed the key issues to be considered by the Trust at the meeting.
156.2 Trust members discussed the BBC funding settlement under which the licence fee would remain at £145.50 until the end of March 2017. As part of the settlement the BBC would be required to provide funding for some additional broadcasting activities, including the BBC World Service, BBC Monitoring and a contribution towards a new partnership arrangement with S4C. They agreed that the Trust’s final conclusions on the BBC strategy review should guide the BBC’s approach in the light of the funding settlement.
156.3 The Director, BBC Trust noted that the new member for Wales, Elan Closs Stephens, would join the Trust on 1 November 2010 and that the Department for Culture, Media and Sport was seeking applications to the post of Chairman, to succeed Sir Michael Lyons whose term would end next year.
156.4 Trust member Jeremy Peat provided an update on pensions issues, in his capacity as Chairman of the BBC Pension Trust Fund.
157 STRATEGY REVIEW: DRAFT CONCLUSIONS
157.1 The Trust’s Head of Finance, Economics and Strategy presented draft conclusions on the BBC strategy review, together with the findings of the Trust’s public consultation and audience research that had informed those conclusions. The Trust had published its interim conclusions on the strategy review in July.
157.2 Members welcomed the structure and approach of the final conclusions document and endorsed the focus on: o increasing the distinctiveness and quality of the BBC’s output o improving the value for money provided to licence fee payers o setting new standards of openness and transparency o doing more to serve all audiences
157.3 Members agreed that these objectives should govern the financial decisions which would have to be made following the new funding settlement and that, as part of those discussions, it would be necessary to look again at the scale and scope of BBC activities. Members agreed that the required savings were unlikely to be made by productive efficiencies alone and believed that some prioritising of services and activities would probably be necessary.
157.4 Members also agreed that the BBC should seek to address concerns about the impact of its activity on the market by setting clear boundaries and providing clarity and transparency about those boundaries. They also discussed the importance of journalism to the BBC’s mission.
157.5 The Trust agreed to have further discussions on the BBC strategy review at its next meeting with a view to publishing its final conclusions before the end of 2010.
158 TELEVISION SERVICE REVIEWS
158.1 Trust member Diane Coyle presented the draft final report from the Trust’s service reviews of BBC One, BBC Two and BBC Four for approval, on recommendation of the Trust’s Audience and Performance Committee. The Trust had published its interim findings on the reviews in July.
158.2 The review had concluded that BBC One and BBC Two were performing well in many respects and that, in general, audiences recognised that both channels provided a high quality offering across all genres, and made strong contributions to delivering each of the BBC’s public purposes.
However, the Trust had found some areas where both channels could improve, in particular to provide the distinctive offering that audiences expected from the BBC. Much of BBC Four’s programming was seen as high quality and distinctive by its audience. BBC Four’s challenge was to increase its impact, particularly in its core areas of specialism, and secure greater reputational dividend for the BBC, while also retaining its distinctive nature. The Trust would revise BBC Four’s remit to clarify its expectations of the channel.
158.3 The Trust discussed the report and approved it for publication. It delegated responsibility for approving minor changes, prior to publication, to Diane Coyle. The Chairman of the Trust’s Audiences and Performance Committee commended the Trust Unit staff who had supported the review.
159 RED BUTTON SERVICE REVIEW
159.1 Trust member Diane Coyle presented the draft final report from the Trust’s service review of BBC Red Button for approval, on recommendation of the Trust’s Audience and Performance Committee.
159.2 The review had concluded that BBC Red Button was a very widely used service, providing access to interactive television content for a large and diverse group of users. It had a substantial cost however, particularly as a result of its high distribution costs, and appreciation of the service was moderate rather than high in line with comparable services. Trust members concluded that Red Button should continue to focus on the things it did well and which its audience used the most: the provision of news and information content through digital text, and additional coverage of major live events. Red Button might be able to play a useful part in the development of IPTV, though it was too early to know exactly what this contribution would be. The Trust would monitor the development of the BBC’s IPTV activities over the next few years and Red Button’s role in this context would be re-assessed at the time of the next Trust review of BBC Online, due in 2012
159.3 The Trust discussed the report and approved it for publication, subject to minor drafting changes. It delegated responsibility for approving minor changes, prior to publication, to Diane Coyle. The Chairman of the Trust’s Audiences and Performance Committee commended the Trust Unit staff who had supported the review.
160 DIRECTOR-GENERAL’S MONTHLY REPORT
The Director-General and Chief Operating Officer attended the first part of the Director-General’s monthly report
160.1 The Chairman introduced the discussion as an opportunity for the Trust to ask the Director- General about his decision to co-sign a letter to the Secretary of State for Business, Innovation and Skills calling for a referral to Ofcom of any proposed acquisition of full control of BSkyB by News Corporation. The Chairman expressed concern about whether the Director-General's co-signed public letter with other signatories was appropriate.
160.2 The Director-General outlined his position on the letter to Vince Cable. He had written on behalf of the BBC’s Executive Board, which had considered the issue. He did not see his co-
signature of the letter as in any way inconsistent with the BBC’s duties of impartiality.
160.3 The Director-General acknowledged that he had not discussed the co-signing of the letter directly with the Chairman or engaged with Trust members and he should have done and would do so in similar circumstances in the future. He stated his regret for this.
160.4 The Trust noted the Director-General's assurance. Trust members also noted the contents of the letter co-signed by the Director-General and made no further comment on it.
Other members of the Executive team joined the meeting for the rest of the Director-General’s report
160.5 The Director-General outlined recent highlights from the BBC’s services, including Strictly Come Dancing, the drama Single Father and coverage of the Commonwealth Games. He noted the success of Downton Abbey and The X Factor on ITV.
160.6 The Deputy Director-General outlined key stories covered recently in the BBC’s journalism output, including the Comprehensive Spending Review and the rescue of the Chilean miners. He noted the publication of the new Editorial Guidelines and said a training programme for BBC staff was underway.
160.7 The Trust and Executive discussed the BBC funding settlement and agreed that the conclusions of the strategy review process would provide the framework within which the Trust and the Executive could consider future priorities.
160.8 The Director-General updated the Trust on changes to the Executive Board, including an enlarged Operations group and the reorganisation of the Journalism division. He also updated the Trust on the proposed changes to the BBC pension scheme and related industrial relations issues. The Director-General welcomed the appointment of Danny Cohen as Controller, BBC One.
161 EXECUTIVE FINANCE REPORT
161.1 The Chief Financial Officer presented the Executive Finance Report which updated the Trust on the financial performance of the BBC in the first quarter of 2010-11. The report, which had previously been scrutinised by the Trust’s Finance and Compliance Committee, covered BBC income and expenditure, spending against service licence budgets, efficiency savings and the financial performance of BBC Worldwide.
161.2 Trust members discussed the report with the Executive and raised a range of issues, including licence fee sales and evasion and the proportion of income spent on content. The Trust noted the report.
162 BBC ONE HD
162.1 The Chief Operating Officer updated the Trust on the launch of a high definition (HD) simulcast of BBC One on 3 November 2010. The Trust had decided in May that the proposals to launch BBC One HD did not require a public value test but had raised concerns that technology and
value for money challenges would mean that the simulcast would only offer a single UK-wide stream from launch with no national or regional variations.
162.2 The Chief Operating Officer set out the process for determining a roadmap for providing national and regional variants in the future. She said the Executive would consider DTT and cable launch of the Scotland, Wales and Northern Ireland variants of BBC One HD as part of the autumn budget process but advised that the costs of introducing nations variants on satellite were likely to be prohibitive.
162.3 Trust members agreed that the launch of BBC One HD would bring significant benefits to audiences across the UK and approved the communications plan for the launch of BBC One HD for immediate release.
162.4 Members recognised that technical and financial difficulties currently prevented national and regional variations on the simulcast, and asked the Executive to take steps to minimise the effects of this on audiences and ensure that they were properly informed about how the changes would affect access to national and regional variations. The Trust would closely monitor the progress towards national and regional variations and would ensure that audiences were kept informed throughout.
163 UKTV UPDATE
163.1 The Chief Executive, BBC Worldwide updated the Trust on Virgin Media’s planned sale of its 50% share in UKTV (a joint venture between BBC Worldwide and Virgin Media). The Trust discussed key principles for the BBC as part of the sale process.
163.2 The Trust noted the progress that had been made on this issue. The Trust approved the Executive’s direction of travel and asked the Executive to return with a proposition in due course.
164 DIGITAL RADIO STRATEGY
164.1 The Director, Audio & Music presented a draft digital radio strategy for the BBC. The Trust had asked Executive to develop the strategy as part of its initial conclusions on the overall BBC strategy review in July.
164.2 The Director, Audio & Music said the digital radio strategy would cover the content, distribution and marketing of services, together with issues around technology. The strategy was being guided by the following principles: o the BBC’s responsibility to lead listeners to digital radio in support of its sixth public purpose o the need to ensure that all licence fee payers stood to gain from the transition to digital radio o the need for all BBC radio services – including digital only services – to be distinctive and focussed on the BBC’s editorial priorities o the requirement to make the licence fee work harder by, for example, phasing investment in distribution and by operating digital services as efficiently as possible
164.3 Trust members discussed a range of issues with the Executive, including the need to present digital services simply and clearly and as ‘sub-brands’ of analogue stations wherever appropriate for listeners.
164.4 The Trust endorsed the Executive’s direction of travel on the digital radio strategy and agreed that the Trust’s Strategic Approvals Committee should consider the proposed strategy, particularly the proposals on distribution and technology, in more detail at its next meeting.
165 ITEMS FOR APPROVAL
165.1 Window of Creative Competition (WoCC) review The Trust approved the findings and recommendations of its second review of the Window of Creative Competition (WoCC) on the recommendation of its Finance and Compliance Committee.
165.2 Referendum campaign broadcasts The Trust agreed to consult on referendum guidelines, referendum campaign broadcasts criteria, and a proposed new process for complaints about referendum campaign broadcasts and party political broadcasts on the recommendation of the Editorial Standards Committee (ESC). The Trust delegated approval to the ESC of the terms of reference for the consultation, the draft documents for consultation and final approval post consultation.
166 ITEMS FOR NOTING
(a) Minutes from committees and Audience Councils (b) Documents for sealing (c) Report of offline approvals
167 BUSINESS HANDLING AND COMMUNICATIONS
167.1 The Trust discussed the handling and communication of items considered at the meeting.