PP108/11 SELECT COMMITTEE OF TYNWALD ON THE TELEVISION LICENCE FEE REPORT 2010/11 REPORT OF THE SELECT COMMITTEE OF TYNWALD ON THE TELEVISION LICENCE FEE At the sitting of Tynwald Court on 18th November 2009 it was resolved - "That Tynwald appoints a Committee of three Members with powers to take written and oral evidence pursuant to sections 3 and 4 of the Tynwald Proceedings Act 1876, as amended, to investigate the feasibility and impact of withdrawal from or amendment of the agreement under which residents of the Isle of Man pay a television licence fee; and to report." The powers, privileges and immunities relating to the work of a committee of Tynwald are those conferred by sections 3 and 4 of the Tynwald Proceedings Act 1876, sections 1 to 4 of the Privileges of Tynwald (Publications) Act 1973 and sections 2 to 4 of the Tynwald Proceedings Act 1984. Mr G D Cregeen MHK (Malew & Santon) (Chairman) Mr D A Callister MLC Hon P A Gawne MHK (Rushen) Copies of this Report may be obtained from the Tynwald Library, Legislative Buildings, Finch Road, Douglas IM7 3PW (Tel 07624 685520, Fax 01624 685522) or may be consulted at www, ,tynwald.orgim All correspondence with regard to this Report should be addressed to the Clerk of Tynwald, Legislative Buildings, Finch Road, Douglas IMI 3PW TABLE OF CONTENTS 1. Introduction 1 2. The broadcasting landscape in the Isle of Man 4 Historical background 4 Legal framework 5 The requirement to pay the licence fee 5 Whether the licence fee is a UK tax 6 Licence fee collection and enforcement 7 Infrastructure for terrestrial broadcasting 10 Television 10 Radio: limitations of analogue transmission capability and extent of DAB coverage 13 3. BBC services across the whole licence fee territory 15 Importance of "national" services to Island residents 16 What would happen if we did not pay the licence fee? 18 Effect on BBC distribution and content 18 Alternative means of receiving BBC broadcast services: Irish and continental models 21 Unilateral withdrawal: conclusion and recommendation 24 Political services: BBC Parliament and BBC Democracy Live 25 4. BBC services to nations, regions and localities within the licence fee territory 28 Radio 29 The question of a BBC radio station for the Isle of Man 29 Putting Manx radio stations on DAB 32 Television and online video 35 BBC television coverage of the Isle of Man: the wallaby factor 35 BBC television coverage of the Channel Islands: the "Channel 988" paradox 38 Online video: BBC participation in an emerging market 39 Technological convergence: resolving the paradox 42 Other online services 44 Words and images on the BBC website 44 Support for the Manx language and Manx curriculum 46 5. "Behind the scenes" activities of the BBC in the Isle of Man 49 Support for Manx Radio and others 49 Activities of the BBC Audience Council 52 6. Financial analysis 54 Analysis based on existing licence fee and BBC expenditure 54 How much does the Island contribute to the BBC? 54 How much does the BBC spend on providing all of its services to Isle of Man residents? 55 How much does the BBC spend on services specifically designated for the Isle of Man ("local" services)? 56 What price a radio station? 57 Analysis based on recent developments in the UK 58 A precedent for pay-back: the one-off payment of £360,000 arising from the switchover surplus 58 The UK Coalition Government's settlement with the BBC: implications for the Isle of Man 59 The financial shortfall: summary and conclusion 60 7. The BBC's attitude to the national identity of the Isle of Man 63 BBC news coverage of the Manx nation 64 BBC expenditure on the Manx nation 65 Aligning the Manx nation with other nations for BBC organisational purposes 65 More coverage, fairer coverage 66 8. Priorities for future negotiations 67 9. Implications for the structure of Government in the Isle of Man 69 A role for Government as opposed to the regulator 69 How we are organised at present 71 Possible reforms 73 The case for additional resources for broadcasting and related media policy 73 Where any new policy resources should be located 73 De-politicising the regulator 76 10.Summary of conclusions and recommendations 77 Oral evidence 85 24th March 2010 85 20th July 2010 117 10th December 2010 149 2hd February 2011 167 28th March 2011 185 BBC Appendix 1: Letter dated 26th January 2010 from Mark Byford 201 Appendix 2: Letter dated 14th May 2010 from Wilf White 207 Appendix 3: E-mail dated 15th June 2010 209 Appendix 4: E-mail dated 24th December 2010 from David Holdsworth 211 Appendix 5: E-mail dated 5th March 2011 from Laura Ellis 213 The Communications Commission Appendix 6: Written submission dated 15th January 2010 215 Appendix 7: Letter dated 28th April 2010 227 Appendix 8: E-mail from BBC quoted in e-mail from Communications 229 Commission to Committee Clerk, 16th June 2010 Appendix 9: E-mail dated 14th September 2010 231 Appendix 10: Freeview channel list attached to e-mail dated 14th September 2010 235 Appendix 11: E-mail from Communications Commission dated 231 1 September 237 2010 Appendix 12: E-mail from Communications Commission dated 27th October 2010 241 Appendix 13: E-mail dated 11th November 2010 243 Treasury Appendix 14: Letter dated 28th April 2010 from The Treasury Minister 245 Appendix 15: Letter dated 6th December 2010 from the Treasury 247 Appendix 16: E-mail dated 27th January 2011 from the Treasury 249 Manx Radio Appendix 17: Letter dated 16th December 2009 251 Appendix 18: Letter dated 27th January 2010 255 Appendix 19: Email dated 7th October 2010 259 Manx Language Officer Appendix 20: E-mail dated 21st December 2009 from Adrian Cain 263 Appendix 21: E-mail dated 2nd November 2010 from Adrian Cain 265 Appendix 22: E-mail dated 8th February 2011 from Adrian Cain 267 HM Attorney General Appendix 23: Letter dated 10th December 2009 269 BSkyB Appendix 24: Letter dated 1st April 2010 271 1. INTRODUCTION 1. Tynwald agreed on 18th November 2009 to the following resolution, moved by Mr Graham Cregeen MHK and incorporating an amendment moved by Mr Juan Turner MLC. "That Tynwald appoints a Committee of three Members with powers to take written and oral evidence pursuant to sections 3 and 4 of the Tynwald Proceedings Act 1876, as amended, to investigate the feasibility and impact of withdrawal from or amendment of the agreement under which residents of the Isle of Man pay a television licence fee; and to report." 2. The Members elected to the Committee by Tynwald were Mr David Callister MLC, Mr Graham Cregeen MHK and Hon Phil Gawne MHK. At the first meeting of the Committee, Mr Cregeen was elected chairman. The Committee has held 14 meetings. 3. The topic of the licence fee was again tabled for debate during the course of our investigation, at the sitting of Tynwald in March 2011. Following a short debate on 15th March 2011 the following resolution, incorporating an amendment tabled by the Chairman of the Committee, was agreed to: "That Tynwald notes that it appointed a Select Committee at the November 2009 sitting to investigate the feasibility of withdrawal from or amendment of the agreement under which residents of the Isle of Man pay a television licence fee; and recognises that the Select Committee continues and awaits its Report." 4. In the course of our investigation we have received written evidence from: • the BBC ® the Communications Commission • Manx Radio • Three FM ® Energy FM 1 * isleofman.com • HM Attorney General • the Isle of Man Post Office e the UK Department for Culture, Media and Sport • the States of Jersey ▪ the States of Guernsey ® BSkyB The principal items from the above list are reproduced as Appendices to this Report. 5. We also invited written submissions from members of the public. We received 38 of these, for which we were most grateful. They are quoted selectively within this Report and the full evidence file has been placed in the Tynwald Library. 6. We heard oral evidence from the persons listed below on the dates shown. The transcriptions of the oral evidence are included in full within this Report and are also available on the Tynwald website. 24th March 2010 ® Will White, Head of External Policy, BBC Operations Group • Laura Ellis, Head of New Media and Business Manager, BBC English Regions • Anthony Pugh, Managing Director, Manx Radio o Hon Adrian Earnshaw MHK, Chairman, Communications Commission ® Dr Carmel McLaughlin, Director, Communications Commission 201h July 2010 • Helen Corlett, BBC Audience Council 2 • Ariane Banta, BBC broadcast journalist based in the Isle of Man • Louise Dow, Business Manager, BBC English Regions • George Ferguson, Director, Three FM • David LeProvost, Director, and Gavin Smith, General Manager, isleofman.com • Andy Wint, Chief Executive, Energy FM 10th December 2010 • David Holdsworth, Controller of Nations and Regions, BBC • Wilf White, Head of External Policy, BBC Operations Group 2nd February 2011 • Paul Moulton, PMC Television Ltd 28th March 2011 • Hon Adrian Earnshaw MHK, Chairman, Communications Commission • Dr Carmel McLaughlin, Director, Communications Commission 3 2. THE BROADCASTING LANDSCAPE IN THE ISLE OF MAN HISTORICAL BACKGROUND 7. The BBC originated in the 1920s and was funded by a licence fee from its inception. The first mention of the BBC in Tynwald was in 1934, when a Tynwald Question by Mr J H L Cowin drew attention to the fact that it was not possible, at that time, for anyone other than the BBC to operate a radio station in the Island. The Governor, Sir Montagu Butler, acknowledged that the Wireless Telegraphy Acts 1904 to 1926 (of the UK Parliament) extended to the Isle of Man and that the BBC's area of operations included the Island.