Labour takes an axe to the BBC

THE British Government abolished the BBC board of governors yesterday and carved up its powers between two new bodies.

Culture Secretary Tessa Jowell announced sweeping reforms of the broadcaster's management structure to MPs as her department published a Green Paper on the future of the BBC.

The reforms were generally seen as a good outcome for the BBC, which was badly shaken by a row with Tony Blair's Labour Government over the Iraq war and criticised in a subsequent review by Lord Hutton.

The governors were singled out in that report for failing to respond to the complaints made by Downing Street, and their chairman, Gavyn Davies, was forced to resign.

Under the proposals, the BBC's royal charter, which expires next year, will be renewed for 10 years. During that time Britain's primary public service broadcaster will continue to be funded by its licence fee, which brings in pound stg. 2.8billion ($6.86billion) a year.

But the board of governors will be abolished and replaced by two separate new bodies - the BBC trust and an executive board.

"There is widespread consensus that the current model of governance is unsustainable," Ms Jowell told MPs.

"The governors' dual role as cheerleader and regulator does not sit easily in a public organisation of the size and complexity as the BBC. It lacks clarity and accountability."

Ms Jowell said the trust would be the "custodian of the BBC's purposes, the licence fee and the public interest".

Its first chairman will be Michael Grade, chairman of the board of governors, who was appointed to replace Mr Davies after the Hutton criticisms.

Ms Jowell warned the BBC that it would have to remain true to its public service broadcasting values, and not chase commercial opportunities for the sake of them.

"It should not play copycat or chase ratings for ratings' sake," she said.

She also paid tribute to the BBC, saying that it was, alongside the National Health Service, "one of the two great institutions of British national life", its archive "a record of our national collective memory".

But it faced many challenges, mainly brought by the transformation of media by the arrival of cheap digital technology, and criticisms from competitors and customers.

"Perhaps surprisingly, the licence fee retains a high degree of public support, and although not perfect, we believe it remains the fairest way to fund the BBC, so it will continue throughout the next charter."

Dan Sabbagh, media editor of The Times, said Mr Grade had got largely what he wanted from the reforms, adding: "The BBC is left intact, and it remains largely free to govern itself."

The Conservative Party's culture spokesman dismissed the proposed changes as "largely cosmetic" and said that although the Government had taken the right approach, it had failed to go far enough in almost every area. The BBC needed a separate external regulator, not the proposed trust, he said.