By David Rose
Media secretary Tessa Jowell has dismayed newspaper proprietors by empowering the BBC Trust to decide whether to develop a network of 60 local TV stations, despite fears they will damage regional newspapers.
Her one concession to the industry this week was to sharpen competition rules to prevent the BBC running roughshod over its commercial rivals.
But although media regulator Ofcom will undertake a market impact assessment, the final decision will rest with the trust, headed by the BBC chairman, when it replaces the present governors.
Day-to-day running of the BBC would then be left to a separate executive board chaired by the director general, while the trust, with new appointees, would safeguard the interests of the licence fee-payer.
Jowell has yielded her power to approve new BBC services to the trust, and will be able to intervene only if it breaks the new rules.
The trust will be responsible for assessing the public value of any new BBC service after weighing up the value to the licence fee-payer against any impact it will have on commercial or not-for-profit competitors.
But David Newell, director of the Newspaper Society, said: "We will need convincing that the BBC Trust, even now that it will be aided by Ofcom, will be sufficiently independent of the BBC to conduct the new public value test.
"There is a danger that the BBC Trust’s primary loyalty will be to the BBC, not taxpayers, nor to the many media businesses that compete with the BBC without the luxury of public subsidy from the taxpayer."
Controversial plans to expand local BBC radio stations and new local news websites into local TV stations are being piloted in the West Midlands. A total of 60 local TV news centres are planned, at a cost of £310 million.
Newspaper proprietors took their concerns to a select committee of peers, which asked the Government to respond.
Trinity Mirror told the peers: "As the market fragments, it will be essential for traditional paper-based media to expand onto alternative platforms to retain readers and advertisers. If those new platforms are effectively closed off because they have already been occupied by subsidised services from the BBC, the long-term future of the core paper product may well be placed in jeopardy."
But in the White Paper, Jowell said: "We have sympathy with the views of the House of Lords Select Committee on Charter Review that ‘if a market impact assessment indicates that the launch of a new BBC service will risk stifling a new market, then the new service should not be launched’.
"The risks identified by the select committee must be taken seriously, but the whole thrust of the new competition regime for the BBC means that the public value test should provide both the mechanism and the rationale for the BBC’s decision-making."