The BBC has moved to deny reports that the public broadcaster’s commercial arm, BBC Worldwide, may be forced to sell off it 50% stake in UKTV, its joint venture with U.S. pay TV network Scripps. It had been reported that the UK government, currently in the midst of a top to tail review of the BBC and its operations and funding, was considering pushing the broadcaster to sell its stake in the group, which owns ten channels, including Dave and Alibi. Scripps has previously had a £500 million to take full control of the group rejected. Culture secretary John Whittingdale, who is seen as a hawk in terms of reducing the BBC’s scale and scope, is believed to be in favour of a sale that generates upfront revenues. BBC Worldwide’s UKTV stake accounts for a third of its profits. BBC Worldwide gives some $330 million a year back to the public license fee-funded BBC through its commercial activities.
A BBC spokesperson said: “While the BBC has not seen any drafts of the White Paper, these proposals do not reflect the discussions we have had with Government on its content.”
A UKTV sale could be a potentially critical blow to BBC Worldwide, which has already pledged to give over £1 billion over the next five years towards the BBC’s funding. The BBC is under pressure to find alternatives to the current funding mechanism, whereby the public pays for the organisation through an annual license fee.
The latest report, which first surfaced in the Rupert Murdoch-owned Sunday Times, is the latest reflection of the tightening noose around the BBC’s current structure. Last month, an independent report recommended the abolition of the BBC Trust. The report, which forms part of the UK government’s review of the BBC charter, proposed doing away with the BBC Trust, which currently oversees the BBC’s internal machinations, and with it 94 years of self-regulation. Instead, communications regulator Ofcom should be responsible for all oversight at the public broadcaster according to the report’s author, David Clementi, who has previously served as chairman of Virgin Money and Prudential, as well as deputy governor of the Bank of England.
There needed to be “fundamental reform of the system of governance and regulation,” said Clementi in the report, which criticized the BBC Trust for its role as “cheerleader and regulator” leading to confusion about where its ultimate responsibilities lay. “The BBC Trust model is flawed: it conflates governance and regulatory functions within the Trust, which leads to confusion about the Trust’s role,” stated the report.
Last year, the corporation had to announce cuts of more than 1,000 jobs as part of a restructuring caused by a $234 million gap in license-fee income for 2016-2017 as well as face a bill in excess of $1 billion for new welfare charges. The public broadcaster was also asked to absorb the cost of the license fee for viewers over age 75 as the government shifted the cost, previously covered by the Department for Work and Pensions, off its books.
The pubcaster remains under pressure to find alternative ways to fund its operations. A report last year from the House of Commons Culture, Media and Sport Select Committee said the TV license is “becoming harder and harder to justify.”
Culture Secretary John Whittingdale, under pressure himself following recent allegations about his private life, is expected to publish his proposals in a white paper next month.