HC Deb 29 November 1995 vol 267 cc1187-9
10. Mr. Dowd

To ask the Secretary of State for Foreign and Commonwealth Affairs what action he proposes to take following the publication of the National Audit Office report on the BBC World Service. [861]

13. Mr. Donald Anderson

To ask the Secretary of State for Foreign and Commonwealth Affairs if he will make a statement on the future of the BBC World Service. [865]

Mr. Rifkind

I welcome the National Audit Office recommendations, which will lead to improved efficiency. The Government have a strong record of support for the World Service. Funding is up by 50 per cent. in real terms since 1980. The reductions announced yesterday apply to its capital allocation, and there is virtually no change in the amount of resources provided to cover its operating costs.

Mr. Dowd

Is the Secretary of State aware that the NAO praised the World Service for its improvements in management and performance since 1992? Such improvements are made more difficult by what he omitted to mention in his answer—the operating cash level has been frozen. Therefore, there will be real terms reductions in World Service funding, coupled with the 20 per cent. reduction in capital allocation which was announced yesterday. Does he not realise that a great British asset, which enjoys support throughout the House, is being undermined by demented Treasury accountants? When will his Department more robustly defend this valuable British institution?

Mr. Rifkind

I have paid no lip service to the BBC World Service. It is a superb service that quite rightly draws support from both sides of the House. I would never do anything to damage the ability of the BBC World Service to remain the premier service of its kind anywhere in the world. The reductions announced yesterday were almost exclusively with regard to capital allocation and were part of a wider Government policy to encourage the financing of capital expenditure through the private finance initiative.

The hon. Gentleman might like to know that the managing director of the BBC World Service said: We are already looking positively as to how the Private Finance Initiative can be applied to our capital plans and I am hopeful that we can make significant progress". The hon. Gentleman should bear that in mind and cheer up.

Mr. Anderson

Does the Foreign Secretary recall with shame the grave damage done to our national interests overseas in the early 1980s by the slashing of British Council and overseas service budgets? With the 20 per cent. cut in capital expenditure, only a hope that the private sector will make up the shortfall, and with no provision for the knock-on effects of leasing on the capital budget, are we not in danger of repeating that historic mistake?

Mr. Rifkind

The hon. Gentleman should reflect on the fact that, since 1980, funding for the BBC World Service in real terms—not just in cash terms—is up by 50 per cent. When the hon. Gentleman criticises what the Government announced yesterday, he might bear it in mind that the chairman of the BBC said: We accept that it cannot be seen in isolation from the totality of the Budget. The BBC knows perfectly well that when private finance is being used for capital allocation throughout the public sector, it is not unreasonable that it also seeks to cover its capital requirements to a considerable extent in that way. The BBC World Service is prepared to look at the matter positively. Why cannot the hon. Gentleman do so?

Mr. Harris

Although I welcome and accept much of what my right hon. and learned Friend has said, does he nevertheless accept that a 20 per cent. cut in the capital programme of the World Service means a reduction of £5.4 million? Is he confident that that shortfall can indeed be met by the PFI? If he can assure the House on that point, he will carry most hon. Members with him.

Mr. Rifkind

My hon. Friend makes a fair point. We are not expecting the BBC World Service to cover all of its capital requirements through the private finance initiative. It will have some £62 million available over the next three years on the basis of the allocations that were announced yesterday. In relation to the proportion for which we are looking to private finance, I can only emphasise that the managing director of the BBC World Service said that he was hopeful that it could make significant progress. It is therefore entirely reasonable for the Government to take the matter forward on that basis.

Mr. Batiste

What does my right hon. and learned Friend consider the impact will be of the BBC's freedom to operate internationally on a commercial basis in television and multimedia? Is not this a massive market opening up for the BBC, and is not the BBC well placed to take full advantage of it?

Mr. Rifkind

Yes. I draw particular attention to the BBC Worldwide TV News, which is already available in 43 million homes and in 111 countries. The truth of the matter is that the BBC World Service already attracts more listeners than the world services of all other countries combined. It is the Government's policy to ensure that that remarkable achievement is maintained.

Mr. Shore

Precisely. The BBC World Service is a great international service and an enormous asset to this country, and what we are talking about is precisely the capital investment which will give it the further audibility and visibility that will enable it to continue to be heard and watched by millions of people overseas. We have no greater asset internationally than the World Service. Does the Foreign Secretary also understand that he is cutting the third year of a triennium of investment? One cannot muck about with a three-year programme at the end of year two and expect people to be able to attract alternative finance in the remaining 12 months. Will the Minister go back and think again about refraining from damaging a great national asset?

Mr. Rifkind

I respect the right hon. Gentleman's clear and genuine commitment to the BBC World Service. If he is as committed as we are to improving the audibility of the World Service, which I believe he is, he might have paid tribute to the fact that we have a £166 million investment programme to improve the audibility of the BBC World Service. The sum announced yesterday to be achieved through the private finance initiative for next year is £5 million. If the BBC itself is hopeful that that can be done, perhaps the right hon. Gentleman, on reflection, will regret the vehemence with which he put his question.

Mr. Lester

I am second to none in my support for the Budget in the sense that my right hon. and learned Friend the Chancellor wants to make this country the enterprise centre of Europe. Does my right hon. and learned Friend the Foreign Secretary accept that many of us realise that the diplomatic corps, which the Budget has assisted and reduced, the World Service and the British Council are very much part of Britain's influence in the world, from which our trade flows? Does he accept that some Conservative Members are worried about any damage whatever to that element of the British effort in the wider world?

Mr. Rifkind

I agree with my hon. Friend. That is why we have protected the operating costs of both the BBC World Service and the British Council from the economies that are being made elsewhere in the public sector. I entirely endorse the objective that my hon. Friend has stated. If we did not take the same view, we would have subjected the operating costs of the BBC and the British Council to cuts. We have not done so. That is an indication of our good faith.

Sir David Steel

While the Foreign Secretary rightly extols the virtues of the BBC's Worldwide TV News, has he noted the point made in the Lothian lecture this week by Mr. Jon Snow, that withdrawal of that service from access to China and its replacement by Mr. Murdoch's channel was not a good example of British interests being solved by private finance?

Mr. Rifkind

That is not the private finance initiative to which I referred earlier, as the right hon. Gentleman perfectly well knows. The BBC World Service receives an allocation of about £170 million. It determines its priorities within that and its ability to transmit to individual countries. We wish it well in the work that it does. I have not the slightest reason to believe that any announcements made recently will inhibit the BBC in maintaining its extraordinary achievements of the past 20 years.

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