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March 1, 2016

BBC Trust should be axed and Ofcom handed oversight, says independent review

By John Reynolds

The BBC Trust should be axed and regulatory oversight should be handed to Ofcom, according to the findings of an independent review into how the BBC is governed and regulated.

The review was commissioned amid wide-ranging calls for the BBC’s governance to be reformed, in light of the Jimmy Saville and Lord McAlpine scandals, as well as outrage at excessive salaries and severance payments to BBC employees.

Dame Janet Smith's findings last week shone a light on the culture and practices of the self-governed BBC during the time when Saville worked there as a DJ and presenter and committed numerous sexual offences.

David Clementi, the author of the review, said the principle of the BBC governing itself through the BBC Trust is no longer feasible and that the trust should be replaced by a unitary board which would ovesee the BBC on a day-to-day basis.

The unitary board would be made up of a majority of non-executive directors, headed up by a non-executive chair.

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Clementi, a former chairman of Prudential and Virgin Money, said: “Following consultation with a wide range of interested parties, and a detailed assessment of the options, I have concluded that there should be a fundamental reform of the system of governance and regulation for the BBC.

“The BBC Trust model is flawed. It conflates governance and regulatory functions within the Trust. The BBC should have a unitary Board charged with responsibility for meeting the obligations placed on it under the Royal Charter and Agreement, and responsibility for the interests of Licence Fee payers.

“Regulatory oversight should pass wholly to Ofcom, which is already the public service regulator for the UK’s broadcasting industry and has the ability to look at the BBC in the context of the market as a whole. Ofcom would be a strong regulator to match a strong BBC.”

Ofcom, which regulates BBC rivals such as ITV and Channel 4 as well as telecoms providers, currently regulates the BBC’s output on matter of harm and offence.

The review said: “The strongest, and simplest, argument in favour of the Ofcom model is that Ofcom is already the public service regulator for the United Kingdom’s broadcasting industry. It already has regulatory powers in respect of the BBC, already has considerable experience in almost all of the regulatory issues that the BBC gives rise to.”

Responding to the recommendation, Ofcom said: “ We note Sir David Clementi’s review, which has considered a range of different options. We await the government’s decision on the future regulation of the BBC.”

Axing the BBC Trust, which was set up in 2007, would be welcomed by some who believe that its role as watchdog and BBC decision-maker is unfeasible.

Rona Fairhead, the former chief executive of the Financial Times group and current HSBC non-executive director, is the current chair. Former members of the trust include Michael Grade and Lord Pattern.

Clementi’s recommendations have been presented to John Whittingdale, the culture secretary, and will be fed into the BBC’s charter renewal negotiations.


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