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Last Updated: Monday, 12 June 2006, 10:41 GMT 11:41 UK
Licence fee 'needs more scrutiny'
Lord Grade and Mark Thompson
BBC management were told to prioritise entertainment shows
The parliamentary team reviewing the future of the BBC has demanded greater political debate in setting the level of the licence fee.

Lord Fowler, chairman of the BBC Charter Review Committee, told BBC Radio 4's Today programme there was currently a "democratic deficit".

He added there should be more scrutiny of the 3bn of public money was given to the corporation annually.

He said assessment of the BBC's Charter Renewal bid was "totally inadequate".

"It's strictly a deal between the Secretary of State on one side and the Chairman of the BBC. There's no bill before parliament," said Lord Fowler.

"It means there's no debate on a whole range of issues and we are talking about 3bn of public money, going up to 4bn, each year.

"We just think that there is, if you like, a democratic deficit."

'Least worst' option

When the government's charter renewal white paper was published in March, the licence fee was described as the "least worst" way to fund the corporation.

The document also made entertainment a top priority for the BBC without chasing ratings or cloning successful shows on rival channels.

A licence fee
A licence fee for a colour television currently costs 131.50 per year
However, the committee has written to Culture Secretary Tessa Jowell to voice disappointment at the government's approach to the charter renewal process.

The letter tells Ms Jowell that "the government has too much unchecked power" and demands that "parliament must be given a greater role".

The current arrangements, in which parliament can accept or reject but not amend the licence fee, was "wrong", it claims.

"Parliament should have the opportunity to scrutinise properly and to amend the formula that will dictate how much every household will pay.

"The funding formula should be put to parliament in a form that allows proper debate and amendment."

'Most open process'

The BBC's media correspondent, Torin Douglas, said the committee thought the BBC's current bid for a licence fee increase was excessive and should be scrutinised by the National Audit Office, he added.

Lord Fowler
Lord Fowler led the committee of 12 peers assessing the BBC's future
The committee believes the BBC's proposal for an annual rise of Retail Price Index plus 2.3% would result in a licence fee of 180 by 2014. The current fee is 131.50 per year.

A spokesman for the Department for Culture, Media and Sport defended the current method of scrutiny.

He said this had been "the most open charter review process ever", with "both industry and the public being asked for their views".

In addition, since charter review began, there had been four select committee reports and a number of parliamentary debates, he said.

"Our research and consultation, which we have published, shows the public do not want parliament or government to have any more control over the BBC than they currently do.

"However, the public do want a more accountable BBC and we will deliver that through the new Trust - a body that will act in the interests of the licence fee payer, clearly separated from the management," he added.


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