Scotland referendum 2014: the impact of independence on the BBC

Scotland and the BBC

The BBC is likely to be a talking point in the referendum campaign, not least because it is seen as a great and highly trusted British institution and a force for binding the UK together.

The BBC has stated that it will not enter into any public or private discussions about its future or the shape and nature of its services after the referendum until that referendum has taken place. To do so might compromise perceptions of the impartiality and balance of its coverage at this critical time.

A new Scottish broadcaster

The Scottish Government's proposal, in an independent Scotland, is to create a new public service broadcaster, the Scottish Broadcasting Service (SBS).

The SBS would retain characteristics of the BBC:

• It would be funded by licence fee revenue from Scotland

If, in the future, the BBC is no longer funded by the licence fee, the Scottish Government would enter into a contract with BBC Worldwide, the BBC's commercial arm which already supplies BBC channels to other European countries and could do the same for an independent Scotland.

• It would be independent of government and editorially impartial
• Like the BBC it would be governed by (royal?) charter

The charter would be devised by an ‘expert panel' and, once agreed, the SBS's principles of governance would be enshrined in legislation.

When would it start?

The SBS would start broadcasting when the current BBC Charter comes to an end on 31 December 2016.

Negotiations over the renewal of the BBC's Charter are not expected to begin in earnest until after the next General Election, so the timing for the launch of an independent Scottish broadcaster would dovetail neatly with the timetable for the UK.

Joint ventures

A crucial issue for the BBC would be its ongoing relationship with the new SBS.

At present, BBC Scotland delivers a range of original programming for the BBC network. In 2011/12 this amounted to 882 hours of originated TV for network channels and 643 hours for the BBC's network radio services.

All of the BBC's pan-UK services are currently available across Scotland. The Scottish Government proposes that, post-independence, the SBS would enter into a new joint venture with the BBC, whereby the SBS would continue to supply the BBC with the same level of Scottish-sourced programming, in return for continuing access to BBC services in Scotland.

Thus, there would be no danger of Scottish viewers missing out on favourite programmes like EastEnders, Doctor Who and Strictly Come Dancing.

Funding

In 2011/12, BBC Scotland's total expenditure was just over £200 million.
Of this, £102 million went on output made in Scotland for Scottish audiences (on TV, radio and online), while £94 million was spent on output made in Scotland for pan-UK audiences.

Licence fees

Although the BBC states that it does not hold figures on the exact number of TV licences currently in force in Scotland, the Scottish Government estimates licence fee revenue to be in the order of £320 million.

This, combined with other sources including a Scottish Government grant for Gaelic broadcasting, would produce a total estimated revenue for the new broadcaster of about £345 million.

On the face of it, the BBC stands to lose millions of pounds in revenue from Scottish licence fee payers.

Impact on BBC

In the past, when presented with figures of this size, the BBC has responded that services would have to be cut – with less original programming(especially home-grown drama, the most expensive of all genres) or even loss of whole channels.

To take a recent example, James Purnell, the BBC's Director of Strategy and Digital, has argued against current proposals to decriminalise non-payment of the licence fee, on the grounds that it would cost the BBC £200 million.

This sum, he has said, is the equivalent of the operating costs of BBC Four, CBBC and CBeebies, which would have to be taken off air.

If the BBC had a significantly lower income, would that have an impact on those very pan-UK services and much-loved programmes whose continued transmission is guaranteed in an independent Scotland?

Or could the SBS offer the BBC a complete quid pro quo, so that there was no diminution of pan-UK services? (The independence White Paper offers the reassurance that the SBS would commission or produce a share of BBC network original productions reflecting the Scottish population share, in terms of both hours and spending.)

Staffing and assets

The division of assets and the re-employment of staff would probably also be an issue. The White Paper is not explicit on how the changeover would be managed from BBC to SBS.

It states that the new broadcaster “will initially be founded on the staff and assets of BBC Scotland”.

Current staff

Currently, the BBC employs the equivalent of around 1,200 full-time staff in Scotland, of whom approximately 1,000 are on permanent contracts.

Commercial ventures

It is proposed that the SBS inherit a “proportionate share” (proportionate, that is, to the country's population) of the BBC's commercial ventures, including BBC Worldwide, and their associated ongoing profits.

Media watchdog

The Scottish Government has plans for a combined economic regulator, which would incorporate the economic regulatory functions of Ofcom, but media regulation is less clear.

Would the SBS be primarily regulated by a ‘trust', as is the case with the BBC, or by a new umbrella media regulator?

If the latter, what relationship would this regulator have with Ofcom south of the border, since there would need to be close cooperation across the British Isles on issues like spectrum management – regulating the use of radio frequencies to ensure efficient use and avoid co-channel interference?