News Release
3 November 2008
NS LAWYERS CALL FOR SUSPENSION OF BBC LOCAL PUBLIC VALUE
TEST
The Newspaper Society’s lawyers, Clifford Chance, have written
today to the BBC Trust and Ofcom asking them to suspend the current
public value inquiry into the BBC’s Local Video plans. They have
advised that the BBC Trust is failing to act in accordance with its
Charter obligations and its agreement with the Secretary of
State.
“The BBC Trust cannot be the chief cheerleader for the
BBC, encouraging it to extend local services out of more and more
taxpayers’ money, at the same time as being the independent
regulator determining the public value of those services and their
impact on local media,”said NS director David
Newell. “Our legal advice confirms that the Trust and
Ofcom are acting in an inappropriate and unlawful manner. We would
ask that:
- BBC Trust and Ofcom suspend the current market impact and
public value test with immediate effect.
- BBC agrees to the suspension of its current application to
the Trust.
- Secretary of State reviews the BBC Trust’s conduct and its
breaches of its agreement with the Government.”
The NS, the voice of UK local media, opposes plans by the BBC
to spend £68 million of licence fee money duplicating local
newspapers’ online news and sport services with a network of 65
local news video sites.It instructed the law firm Clifford Chance
following a series of problems during the course of the public
value test (PVT) which it believes undermine the independence and
integrity of the current process.
The issues, outlined in a letter from Clifford Chance to the
BBC Trust today, include failing to provide vital market
information and analysis to the NS, unilaterally changing the PVT
timetable without consultation, and failing in its stewardship to
demonstrate due independence.
The NS, through its lawyers, is asking the BBC Trust to
suspend the PVT until the market information it has requested has
been supplied and the industry has had a chance to respond to it.
The NS believes this information, relating to BBC Local audiences,
costs and funding, to be vital to Ofcom’s market analysis and to
enable the NS and its members to respond properly to the PVA/MIA
process.
The Trust is also asked to ensure that Ofcom’s market impact
assessment (MIA) of BBC Local Video, which forms an important part
of the PVT, is undertaken in accordance with standard regulatory
methodology looking at individual local markets and taking account
of their differences, and that Ofcom is asked to issue a draft MIA
for comments before issuing a final MIA.
Above all, the Trust is asked to ensure public confidence in
the integrity of the PVT is not undermined and to refrain from
making comments which indicate that the Trust is not bringing a
fair and open mind to the process.
This follows comments made by BBC Trust chairman Sir Michael
Lyons at a Broadcasting Press Guild lunch last month at which he
said: “There’s nobody who can be satisfied with the quality of
local news in most parts of the United Kingdom… The local press has
nothing like the strength that it once had. It’s not the same
proposition that it was 15 years ago. Will the BBC make it better
or worse? That’s exactly the issue to be explored.”
Clifford Chance points out that it is difficult to reconcile
such comments, which echo those made by Sir Michael at an NS lunch
on 1 April, with the conduct of an objective PVT. There has been a
backlash from publishers and commentators to the remarks, which the
NS and its members fear show that the Trust has already pre-judged
the decision to approve the local video proposal before the
conclusion of the PVT.
Sir Michael’s views are in stark contrast to those of
Culture Secretary Andy Burnham
who recently described local newspapers as
“pillars of
the community” which were vital for local democracy and
instilling local pride. He also indicated that BBC director general
Mark Thompson was
“increasingly sensitive” to the BBC’s
impact on other media.
David Newell said: “There are critical issues at stake in
this process, relating to media plurality, market interference, and
a free press. Local publishers have alwaysmaintained their
independence from statutory content controls, state subsidy and
public funding, in order to safeguard the freedom of local media
journalism.
“They have invested heavily in developing their digital
operations to protect the future of local media businesses and
offer the public online local news services, including local video
stories, alongside their printed newspapers and other platforms.
Although these services are still in their infancy, they are
beginning to see growing online audiences and revenues and are seen
as intrinsic to the local media business model.”
“The BBC’s publicly-funded intervention in the local media
market with a major development such as BBC Local Video at this
critical time against the backdrop of aggressive market conditions,
would constitute highly damaging interference and market
distortion, competing head to head with every facet of a local
media company’s multimedia portfolio, whether mobile, website or
broadcast.”
The NS, the voice of Britain’s local
media, represents 1300 newspapers, 1100 websites, 750 magazines, 36
radio stations and two TV stations.