Good morning, everybody, and can I welcome all of you to the first meeting of the Education and Culture Committee in 2016, and I also wish everybody a very happy new year. Our first meeting of the new year is to look at BBC Charter renewal. Before we do that, can I remind everybody to make sure that all electronic devices are switched off because they can interfere with the sound system? Our first item is to take evidence on the BBC Charter renewal, as I just mentioned, and can I welcome to the committee Professor Robert Beverage, Professor Neil Blane and Professor Philip Schlesinger. Unfortunately, Dr John McCormack has sent his apologies as unable to be with us this morning. I'm going to move straight into questions, if you don't mind, and I'm going to begin the questioning with Colin Beattie. At the broad thrust of the submissions that have been made to this committee, there is a clear feeling that the present structure of governance isn't adequate to what is required now. Indeed, there is mention made a number of times about some sort of federal structure. What would the pros and cons of a federal structure be? Where would the advantages come and where would the disadvantages come to Scotland? In governance, first of all, I think that it's worth making the sort of the macro-level point perhaps that at present perhaps one of the reasons that broadcasting has been discussed, I think over the last, probably not an exaggeration to say 25 years or so in Scotland, sometimes in a manner that hasn't greatly altered, is that the responsibility for broadcasting still lies in Westminster with GCMS, and it's therefore been possible to have this Parliament as welcomed, for example, the Scottish Broadcasting Commission report in 2008, follow-up report for the digital network panel in 2011. I suppose that when you ask about governance, the first question is whether it would be helpful where the BBC—we're having to imagine the future of the BBC a little bit just now because we don't quite know, for example, too far into the future what the funding mechanism is going to be, but it would be helpful if the BBC were directly answerable perhaps to this committee or to another, to an appropriate committee at Holyrood, which I think would enable us to discuss those matters in Scotland in a different way from what has happened before. You ask about a federal structure. I think in my own paper, and I want to say, I mean, I regard myself as a BBC loyalist, I think probably all of us here regard the BBC as an enormous asset, both UK-wide, it's an enormous asset in Scotland. I've expressed scepticism in my own submission about how the BBC might move to a federal structure. What I've been trying to do, and I hope I'm not trying to digress from your question here, but I think it's quite important, or I would like to put the argument out there that it might be more helpful not to wrap up the whole of the question about the future development of Scottish broadcasting in an envelope marked BBC charter review or future of the BBC. I wouldn't like to take it for granted that the future development of Scottish broadcasting rests on the ability of the BBC to achieve cultural change, for example, in the direction of which you indicate. It's interesting that the move to Salford, which is a very substantial and expensive move, doesn't seem to have resulted in the continuation of observations from the north of England, from Scotland and elsewhere to the effect that the BBC still seems rather London centric. I don't want to answer your question with a question, but I think that there is a question which is how would the BBC achieve a federal structure? Does it actually want to? What would that mean? Among the attached questions are, if it's more likely to appear in a federalised form in Scotland, what implications would that have for, for example, the north of England? It seems improbable that the BBC could adopt, as it were, a limited federal model in one part of the United Kingdom. I would be left rather speculating about the form that it would take. The important thing is that Scotland really ought to have at least one television channel with editing and commissioning authority in Scotland. Ireland has, including the Irish language channel, six. We have one BBC Alpa. In Catalonia there are half a dozen. Ireland has six from last Saturday when Ulster TV started broadcasting something called Ulster UTV Ireland. Those channels have a difficult existence. RTE, TV scenes and so on in Ireland have to struggle for revenue, but I think that we are in a very, very different position in Scotland. I'm answering your question in a complicated way, but I think that what I would like to say is that I'm not absolutely certain that the solution to Scottish broadcasting is a federal BBC, it might be, and if the BBC culturally and in terms of revenue are capable of running a channel with editing and commissioning autonomy in Scotland, I'd be delighted. I feel as though we might wait for a long time for that to happen. My view is that we should have a federal structure. It may be more appropriate, however, to speak of devolution max for the BBC rather than federalism. You yourselves know about the evolving relationship between the Scottish Parliament and the Westminster Parliament and the strengths and weaknesses of that relationship. I'm convinced that, whether to be a federal BBC, the same kind of problems would be encountered. From my perspective, BBC Scotland needs to be not the BBC in Scotland, but it needs to be BBC Scotland or more of a Scottish BBC. You asked about a downside. Maybe one of the downsides in that new settlement would be that London might be even less inclined to put programmes made in Scotland on the UK network. However, at the moment, as we know, River City has massive investment and it's not shown on the BBC British network. That's not value for money. While I personally am not a great fan of River City, it seems to me that it should be on the BBC network and Scotland should be portrayed to the rest of the UK in a much better way. I believe that a federal structure would help to bring that about. Professor Slesinger. I think that federalism has become a bit of a slogan. The key thing is to have decentralisation of the BBC under whatever name. I think that Scotland needs to have much more control over expenditure, over commissioning and over strategy. I do think that if there's to be a debate about the decentralisation of the BBC, it's certainly helpful if a push comes from Scotland, but it's a conversation that would also necessarily involve people in Northern Ireland, Wales and certainly in the north of England. I don't think that one set of requests is going to hack it. I think it's a much wider debate. I don't think that federalism, in a formal sense, is going to come about before the federalisation of the United Kingdom and the United Kingdom has been notoriously bad at sorting out its constitutional arrangements, so I wouldn't get too hung up on that. I think that the question is much more one about decentralisation. I think that the downside is one in which there might be an overall loss of strategic purpose inside the BBC. I think that the BBC's culture itself has to change to allow itself to consider both its global strategy and the variety of strategies it needs within the UK in relation to the UK's diversity, not least its multinational diversity. At the moment, it seems that the BBC is not only fighting political pressures and adaptations to technological change and economic pressures, not least around the licence fee, but is also trying to reposition itself for a global marketplace. There are inherent tensions in any sort of attempt to get the BBC to focus on what is needed for Scotland as well as what is needed for its present fight to stay in the game in the UK as a whole. Members of the panel have expressed views on different facets of the federal structure, but it is inextricably tied up in that as a question of accountability, which is at the core of everything. There is a question about the adequacy of accountability of the BBC to the Scottish Parliament within the present structure. Could a greater accountability for Scotland actually be achieved without introducing what I will call for want of a better word, the federal structure or a devolved structure, or would it be necessary to have that devolution, that level of devolution to Scotland, before proper accountability can be brought in? In principle, there is no reason why the BBC devolved or undevolved could not report to the Scottish Parliament now, if a mechanism could be found. Obviously, there would have to be under these circumstances legislative change, but I think that your question posed—the question is whether is the key thing changed to the devolution settlement affecting this Parliament or changed to the BBC? If the BBC were devolved, the same constitutional issue would arise about its accountability at the moment, whether it were devolved or not, because it still would not require, not just the case that it would not require to report to this Parliament, but in fact the legislation enabling this Parliament does not give the Parliament oversight of the BBC. In that sense, I do not think that it would matter if the BBC was devolved or not, so two actions would need to take place. This Parliament would need to acquire extra powers and the BBC would require to be devolved. What Professor Schlesinger said, I agree with, I hear words like devolution of the BBC, federalisation of the BBC, but since we do not really have a precedent within the BBC, it is actually very difficult to know what that would look like. I think that accountability is a very complex question. I support the BBC being accountable to the licence fee pair. I support the BBC being accountable to this Parliament and to the Westminster Parliament. However, that has to be done without compromising the independence of the BBC, because politicians, forgive me, do need to be kept arm's length from the BBC for a whole variety of reasons. What I would particularly like to see is for BBC Scotland to have its own budget. There is a debate at the moment about off-coms definitions, Scottish productions, the BBCs and so on and so forth. I have not seen, because I do not think that anybody has seen, BBC Scotland's proper overall budget. I would like to see that in order to get a handle on how that budget is deployed. That might include, for example, how much the BBC contributes to the overall spending of the BBC network. At the moment, you can see a bit more about STV's budgets than you can about the BBC's budgets, and I think that that is unacceptable. If I may add a word, I think that the question of accountability is accountability for what purpose, effectively. There is absolutely no reason why the BBC should not, as it informally does now, anyway submit its report on Scotland to this Parliament and account for what it does. There have been arguments in the public domain about other forms of accountability in terms of its board structure, and I guess that is a complex matter, but one that, if it were to be fully proposed, might be properly debated. I think that we do need to distinguish between financial accountability on the one hand, which would in any case be overseen by bodies such as the national audit office, and accountability for the range of programming that the BBC offers. I think that quite a lot gets wrapped up in the discussion about accountability, and I think that if that is going to be a serious argument, it is not simply about formal structures, but it is also about distinguishing the different elements of accountability that the Parliament would wish to have. The members of the panel have had slightly different facets as to what accountability is, and the description of that is a different debate. Obviously, the Scottish Parliament should have some form of scrutiny over the BBC. What information would be required for that in your view? Obviously, there are going to be slightly different views on that, but what would you view as the essential needs of the Scottish Parliament in scrutinising the BBC in Scotland? I would have thought—I do not want to repeat the point that Professor Beverage made, that the budget is a key one—that a lot of the other information is available, and I think that it depends on what forms of accountability we are looking at. Other than budgetary information, I should have thought that a lot of the information that the Parliament would need is there. The key question is, with what authority is the Parliament scrutinising that information? Many people, since the Parliament was set up, have looked at what seemed to be an anomaly where Scottish culture—there are cultural responsibilities in the minister with responsibility for Scottish culture, but strictly speaking that does not include broadcasting in terms of the manner in which the Parliament was set up. I think that, at danger of repeating myself, I would have thought that the key thing here is, with what degree of authority, under what form of legislation does the Parliament scrutinise those forms of information. I do not think that the information is actually the problem, assuming that one can extract detailed information about the budget. What I would say is that there is a complication that a lot of people point out that the BBC collects—perhaps we do not know maybe 350 million thereabouts from Licence Fee in Scotland—Licence Fee plus Scotland's share of commercial activity. We say that we do not think that the BBC spends that on, for example, BBC Scotland or its funding of BBC Alpa. On the other hand, the counterargument is that Scottish listeners and viewers enjoy the full range of BBC services that people do in London and Leeds. Therefore, I think that there is a complex bit of arithmetic to be worked out there. This is difficult because people take different positions here on what exactly is the shortfall or what is the reasonable estimate of the shortfall in terms of what is spent in Scotland as distinct from the Licence Fee taken in Scotland. That is a very difficult calculation. I would go back to 1951 in the report by the late Lord Beverage and the response by the Westminster Government at that time, which says that the Government attach great importance to the maximum devolution to all areas on programme policy and otherwise, and they agree with the broadcasting committee that the existing arrangements are inadequate. That is back in 1951. My experience of the BBC, both as a citizen and as a consumer of their output and so on and so forth, is that they know—just as you know—that they have a problem in Scotland, and they have known for a long time that they have this problem in Scotland from their own research, and they have done not enough about it. We have heard from the BBC and, like Neil, I am a loyalist, I am a great supporter of the BBC, but we have heard from BBC directors general and chairman going back decades that there is a problem. We are doing something about it. They are still saying that in their response to your questions for Lord Hall next week. My proposal, and what I want you to concentrate on, is the future and not just listening to their rhetoric and saying that we are going to do something about it, but finding ways of ensuring that they do something about the problems. If this was Markson Spencer or John Lewis, you would believe that they would have solved the problem of cultural representation for Scotland and production Scotland long ago. My proposal in my submission is that the director Scotland and the director general should have their pay linked to performance. If they do not really address the purpose gaps in Scotland, then their pay needs to be docked, because they are the people with whom the buck stops. However, I do not want you, as politicians, to tell the BBC what should be on the screen and what should not be on the screen. That is why the complex nature of the relationships between regulation and governance and the politicians needs to be handled with great care. I would like to strongly support that. I think that it is really important that there is no string into questions that are strictly regulatory. I think that one area where the Parliament might take an interest, though, quite properly, is to look at the public purposes of the BBC as they get redefined in the course of the charter review and to see to what extent the BBC in Scotland is addressing those public purposes in a satisfactory way. At the same time, again, I would completely agree with what Robert has said that it is very important to stay out of questions of programming. There is an inevitable tendency in political life to get annoyed about things that are thought to be misrepresentations. I think that everyone understands that that is the case, but it is really important not to get into that or, indeed, to feel as though there should be prescriptiveness about content. Beyond those questions, looking at the underlying principles and arguing about those seems to be a good way in addressing the BBC's performance. A very quick question to expand on the subject of accountability. We have spoken about Scottish Parliament's relationship with BBC Scotland and BBC, but I was thinking about the off-com advisory committee for Scotland and the audience council for Scotland as well. In the evidence from the off-com advisory committee for Scotland, they said that they are concerned that there is a lack of local accountability within Scotland for Scottish-originated output. The current situation means that, formally, the audience council for Scotland needs to provide feedback to the BBC trust, which then provides feedback to the BBC management in London, which then feeds back to the BBC Scotland management team, i.e., there is no direct accountability to BBC Scotland from audience council for Scotland. How do we address that wider subject where there are other organisations other than the Scottish Parliament who have an interest in what is happening at BBC Scotland? I agree with what has just been said. I believe that there is accountability from BBC Scotland management to the audience council Scotland. The audience council Scotland and the chairmanship of the BBC trustee for Scotland meet almost on a monthly basis. The senior management of BBC Scotland are there and there is dialogue, so in my view— Off-com is wrong on what I have said in the advisory committee. It depends how you define accountability. A dialogue takes place. In that sense, there is accountability. The problem is what I referred to in my earlier response. What happens is that dialogue takes place but not enough changes. The matter is how you ensure that BBC Scotland management, but in particular the BBC in London, not only listens but acts upon what it hears. That is the key point for me. I think that this is an issue that, in many ways, is a bit up for grabs right now, because the future of the BBC's governance under the trust within which the audience council sits is clearly a very moot point. I would have thought alongside any sort of discussion of accountability to this Parliament, rethinking systems of accountability within the BBC and to its advisory organisations might well be something that should be pursued. I presume that you agree with that statement that Gordon just read out. Do I agree with it? Not necessarily. Despite the fact that you set on the body that wrote it? Yes, but you are getting me into an area that I might not wish to discuss. Yes, but you set on the body that wrote that statement that Gordon just read out. I do. If you do not agree with that, what would you suggest? I think that the audience council, at least from observation, occasional times that I have met them and seen them in action, finds it quite difficult to be a robust internal critic. I think that this particular year, it does seem to have been one, but I think that that is more occasional than systemic. I do not wish to be particularly critical about that. I just think that everyone knows that when the trust was set up, there were lots of questions about it then. There have been issues around its performance ever since. I am saying this purely in my personal view. It has nothing to do with anything else that I do. It has, if you like, as an academic observer. There are questions being raised about its future. It is a very good moment to be thinking not just in respect of Scotland, but in terms of thinking about other parts of the UK, how those relationships with the nations and the ways in which the nations are represented and handled might be rethought. I would not go any further than that. I would not want to be prescriptive about it, but I think that it is a question that is inevitably going to be looked at, because those arrangements are going to be rethought anyway. Neil Hamilton I do not think that there is any shortage of intelligent, well-informed, robust critique of BBC performance. The key question is how senior executives respond. We can talk about the mechanisms all day. There is lots of information, for example, about the London-centric nature of the corporation that is perceived outside, but that does not stop the launch of another series about transport in London, or sewage in London, or anything else in London. The series is called Our Streets, which are all about streets in London, whereas, as I have observed, there are streets in Sheffield and so on. Those points have been made endlessly over a long time. I do not think that the perfect ability of critical and reporting mechanisms is the key issue here. It is the response, the attitudes, the culture of senior executives. That is why, if I may, it is just a response to a few things that have been said, just to return to something that I said at the beginning, which is that what the Broadcasting Commission in 2008 had in mind was that rather than to hang all those things on the BBC, which is under attack from some minority of people, but very vociferous—very vociferous newspapers and quite vociferous people in Westminster—rather than to hang all those responsibilities on the BBC in another way to do this, it would be to get the BBC to fund a Scottish channel, a part fund of the Scottish channel, and there are models for this, and BBC Alpa, in a sense, is one of them—not run by the BBC, or not run by the BBC as we understand it now. In other words, I am taking a slightly more radical position here possibly in my colleagues, but what I am saying is that one way of looking at this is saying that we could work away with the BBC at mechanisms that would somehow end up with the BBC running the Scottish channel completely, with complete commissioning and editing autonomy in Scotland. But the signs from the BBC are not really that they would be very good at doing that. Now, for another model, if we are worried about what they spend in Scotland in relation to what they take the licence fee, is to look for funding rather than a large shift in culture and the ability to run a Scottish channel. I am simply suggesting that those two models are out there. I may about BBC Governance and Scotland. I was part of a campaign over a decade ago when Ofcom was set up out of the existing legacy regulators, independent television commission, radio authority and so on and so forth. To try to ensure that on the main board of Ofcom there was representation for Scotland, Wales and Northern Ireland, as well as a member for England, that battle was lost. Ofcom decided that they would have people who were described as partners, not governors, not commissioners, not trustees but partners. The representation for Scotland within the current structure of Ofcom is that there is a Scottish member on the content board. In other words, Scotland and the listener and viewer in Scotland does not have a seat on the main board of Ofcom as the main broadcasting and telecoms regulator in the UK. We have had in the BBC, in relation to BBC Governance in the early 1950s, a member for Scotland, who was the governor and then became the trustee. We are now engaged in a process that is going to lead to a new settlement and new BBC charter. The dominant position seems to be that the BBC trust will be abolished and will be replaced by a unitary board. Now, if we go back to the last BBC charter, around 2005-2006, I took part in the Burns hearings down in London, Michael Grayd at that stage was a leader in setting up the BBC trust. He was at this meeting talking about his wish to have governors or trustees who had the right skillset to run the BBC as a large organisation, which I fully support. I agree, that is what he wanted. But I said, well, what are we going to do about Scotland? Because where is the representation for Scotland going to be in that new system? Unfortunately, that continued, but I think that in some ways it might have been a close run thing. I am very concerned about the future voice of Scotland, the future representation for Scotland, in any new BBC governance structure. Ronald Fairhead has been talking about having a unitary board with non-executive directors. The existing non-executive directors on the BBC board failed when it came to executive pay-offs, when it came to looking over the digital initiative and the BBC trust, which has done some very good things as well as some things not so good, took the blame for what was the problem with the non-executive directors. Now, if we have a unitary board with non-executive directors, are we going to have a non-executive director for Scotland? Maybe. Is that the right term that we want to have for a public organisation? I think that that could be part of a long-term plan to start privatising the BBC 15 years down the road and turning it into a company instead of a public corporation. I would counsel the Scottish Parliament and this committee in particular to think through those issues in whatever you put into the charter review process. Thank you, Gordon. Did you have anything else, Shokie? Mary Scanlon. Can I just, convener, pick up something in Professor Beverage's 14-page submission, which I have to say I found quite offensive? Regarding River City, not your taste, but your late mother enjoyed it and I'm confident that there are many mums another south of the border who might wish to view it. I apologise. You've actually found that quite sexist and ageist as well. I understand that. I'm giving you the opportunity to apologise because I think it's a very good programme and I don't think we need that when we're sitting and looking at BBC Scotland getting more production. You're entirely right and I'm afraid I was carried away. You should never have written it then. That's correct and I was referring to my mother at the time. Yes, but mum south of the border, do you think men don't watch River City? Men do watch River City and I agree entirely with you that it should have been changed. Well, I did find it quite offensive. I hope in your position you won't do it again. Let's move on. Thank you for bringing it to my attention and I give you an unreserved apology. That's fine, that'll do for me. Can I just ask, are any of you familiar with the memorandum of understanding, which was actually changed by this Parliament's Audit Committee, and it requires that the annual accounts and report is laid in front of this Parliament and scrutinised by the Parliament's Audit Committee, which Colin Beattie and I both sit on? Are you familiar with the memorandum of understanding and are you familiar with the work of this Parliament's Audit Committee? I'm aware of the memorandum of understanding. I'm not familiar with what the Audit Committee does, but I think that the memorandum of understanding, in some respects, mirrors the relationship between OFCOM and this Parliament, if I'm not mistaken, or at least that there was something very similar drawn up quite a few years ago now about the reporting to this Parliament by OFCOM. It's the BBC Scotland's annual accounts and report and this Parliament's Audit Committee is very effective in its scrutiny of such documents, but if you're not familiar with it, I find that a bit disappointing because it's a huge part of the accountability. I think that I would draw your attention to the response that you've just had from the BBC itself, which says that consideration is currently being given to us, the House of Statistics information pertaining to each of the nations, including Scotland, may best be incorporated. I think that not only I but other people sometimes have some difficulty notwithstanding the expertise of the committee to which you refer, in unravelling the complexity of the BBC's accounts. I would hope for improvement in the future in particular to enable us to disentangle spending in Scotland by the BBC and the BBC Scotland's accounts from the UK version. That's a job for the Audit Committee and I have to say that it's a very competent Audit Committee. I don't doubt it for one moment. Can I just go on to the distribution on spend in regions of the United Kingdom by channel? We've got Scotland, Wales and Northern Ireland. Have all increased in the last four years between one and a half and two percent? Can I just ask a direct question? What proportion of the licence fee collected in Scotland, in your opinion, should be spent in Scotland? More, certainly. I'm going to be honest. I find that the kind of question which I think can only be answered in dialogue with the BBC over very specific three-year or four-year plans, because they're sympathetic to the view that the BBC could spend more of the licence fee in Scotland. Just to put this in perspective, if we look at what a channel might cost, it might cost maybe £80 million or something of that sort a year to run, and that's not necessarily a lot of money. The director general of the BBC recently found, and I'm glad he did, £85 million for the world service, for example, new money, as it were, but money obviously coming from existing budgets. It's very important that he should. We can talk this around with a number of figures. The difficult part of the argument is to quantify the cost—the legitimate cost, as it were—of the amenities that Scottish viewers and listeners have in common with the rest of the United Kingdom. I do feel sympathetic with BBC managers when people say that they only spend so much in Scotland, but they collect £350 million. Sometimes that argument doesn't take account of the fact that people watch Strictly, the Great British Bake Off and the Great British Menu, as I know I do myself. To quantify what is legitimate in hard figures is very difficult. I think that one can go this far and say that there's still quite a big gap, given the size of the gap between what is collected and what appears to be spent, to the extent that we can agree what is spent. I know that one of the other submissions from Tern, one of the independent companies, notices the lift-and-shift question about what exactly counts as expenditure. I'm dodging your question in the arithmetical sense, but I would think that there is room for substantially more expenditure. You mentioned, by the way, the one and a half percent more and so on. In my 25 years or so of being connected one way or another with the BBC, including doing in the past audience research for it and so on, I've seen these figures go up and down. I'm a little bit skeptical—Just over the last four years. Yes, but it's gone up to nine and then down to three, for example. And if you look at the BBC as a whole, I think what's more interesting is the pattern of regional expenditure over years than what is happening over the next year or what happened last year. This doesn't just apply to Scotland. I mean, we all used to be conscious of where BBC Birmingham was at Pebble Mill at one, and then Pebble Mill stopped being important. So there's lots of evidence of the BBC prioritising a regional spend and then drawing it and putting it somewhere else. I've made it here probably before, but that's not very strategic. We tend to get quick fixes where the BBC reacts to saying, well, you only spent 3 per cent or something this year in Scotland. Okay, we'll go up to 9 per cent next year, but it doesn't seem to me to constitute a strategic broadcasting strategy in Scotland. The BBC did increase its expenditure, and what did it do? It brought in the weakest link, Waterloo Road and Question Time, to be run out of Glasgow. That's good, because that increases jobs and investment in the creative industries in Scotland, but what it did not do was meet the needs of the licence fee pair in Scotland by improving cultural representation. Also, the weakest link was near the end of its life, as I said at one meeting around that time. One can quite well understand why the BBC and its out-of-London strategy didn't place the weakest link in Wales, because Anne Robinson wouldn't have gone down well in Wales. Then it closed. Waterloo Road closed. What we need is a strategy for investment in the creative industries in Scotland, led by the BBC, but not only the BBC, and to improve cultural representation in the interests of the licence fee pair and the citizen in Scotland. I think that I'm with you, Mr Blane, because I think that the targets and quotas—and we've discussed them in this committee often enough in the past—it's a crude measurement, and it can vary by the year. However, what I really want to ask is—in response to Colin Beattie, you mentioned federalism in some detail. I'm not asking you to repeat that again. Given that we have this system of lift and shift, which was explained very well by matchlight productions, it's looking at the extent of quotas. How effective are quotas in ensuring content production, or is it just an artificial market that can chop and change at any time, as you saw with the weakest link? What options would you like to suggest for more sustainable production in Scotland, and how that could be monitored and enforced in the future? We've talked about federalism and quotas. Should federalism be the answer? Is it the devil, Max or whatever? However, instead of looking at what we shouldn't have, could you tell us what we should have? We know quite a lot about the history of quotas, not just from television but from the film industry. We could go back to the 1930s, when there were people in the British film industry who thought that there could be a mini Hollywood, Pinewood, Ealing and elsewhere. Quotas tend to come and go. At the risk of sounding like a channel bore, as it were, no workly intended, I think that one of the things that you find in Ireland, when you look at the media situation, is rather stable across the board. If I take us back to when the opt-out model started in Scotland, STV appeared in 1957. From that time onwards, we accepted that in Scotland we would have an opt-out model where Scottish viewers—radio was different, by the way. We should probably always talk more about radio than we do, actually. We're talking about TV. As far as TV goes, we have accepted since that time that Scottish viewers watch what everyone else in the United Kingdom does, and, with the exception of BBC Alpa, we still do somewhat what we did in the 1950s and 1960s, to a varying extent. We come out of the schedule and we watch things that only Scottish viewers watch at certain times. That puts a clear lid on what STV and BBC Scotland can do. It's not what they're making, and I'm not critical of them. They work within that restricted environment. I suppose that what I'm saying is that we have an opt-out model that was valid in the days of Larry Marshall and the One O'Clock gang, whom I mentioned with all respect. At that time, we also had a vigorous press, an indigenous press, a well-resourced press. Television wasn't particularly important. It now is. One of the things we know about TV is that it's very important democratically and economically. We couldn't have foreseen in 1957 how important economically TV could become. I think that my answer to you is that the BBC, which I am reliably told—indeed, I even reported this on a BBC programme at the time, which was an article in The Guardian just towards the end of August—had in fact been a plan for the BBC to launch a Scottish channel before a further round of cuts. I don't know the detail of that. If the BBC envisaged a Scottish channel based in Scotland, with, as I've said before, editing and commissioning autonomy, Halleluya, if it was going to run something like that, I think that that would be good. I think that that is the answer. I've heard senior managers at BBC Scotland and STV say that channels are not the answer. STV, in fact, has launched a couple, STV, Glasgow and Edinburgh, so I suppose they must believe in channels at some point. I think that my answer to you is that I find it difficult to see the kind of production base we want to see being built up here unless we have at least one channel, which is commissioning a lot more work than is commissioned in Scotland just now. My question is really about an income and expenditure model, but instead of an income and expenditure model, quotas, featherlism or whatever, what you're saying is that the answer is a BBC Scotland only channel. That's the answer. I'm looking for a funding model. It is theoretically imaginable in a way in which I think that federalism to me isn't, because I simply don't know what BBC federalism would look like. I know what channels look like. I know how RTE works in Ireland and TV3 works in Ireland and how Catalan channels do, and there's one in every Dutch province and all the German lender have them under German constitutional law. The fact that we have BBC Alpa, I think, is wonderful, but it could, I think, BBC Alpa can itself be something of a model for an English language channel. I'm afraid I'm very old-fashioned, I believe, in channels, so that's it. I've got a couple of questions on income and expenditure. Earlier on, Professor Blaine, you said that RTE was struggling financially, but it had six channels and four radio stations. Now, I had a quick look at their accounts there. Their operating costs are 312 million euros, which equates to £234 million. In Scotland, according to the answers that the BBC gave us, the licence fee alone raises £323 million in Scotland, do you think that, bearing in mind the service provision provided in Ireland, that Scotland actually gets good value for money out of that £323 million? No, I don't want to overdo RTE struggles. All I was trying to say was that I don't want to paint a rosy picture of the Irish broadcasting environment, because TV3, which is RTE's main commercial competitor, has had to take out a lot of loans and so on. There have been moments where RTE have struggled. In answer to your question, I greatly envy not just the Irish broadcasting environment but the Irish media environment. They also have a newspaper of the Irish Times, which has been the envy of several Scottish newspaper editors. The Republic has a smaller population than Scotland, so if we are looking at what is imaginable, Ireland is a good model. Of course, its history is entirely different, and there are all sorts of differences that have brought about the existence of RTE. However, I do not want to overdo RTE struggles. I merely make the point that, when I say that there are six channels, a couple of them do very much. One was just set up last Saturday. Nonetheless, if we say that BBC Alpa is the equivalent of the Irish language channel, that still leaves us with five other TV channels in Ireland, and we have none. It is strictly comparable in the sense that STV works on an opt-out, as does BBC Scotland. I have no difficulty using the Irish model as something that we should look at, at least in an interested way. I would be loath to throw out quotas before any other solution has been found, because quotas are at least a commitment to a distributed conception of spend around the UK. There may be shortfalls in how that works, and there may be questions asked about whether all the accounting is accurate. However, it is a very important principle that not everything should be centred in London and the South East. I think that on any sort of conception of an autonomous Scottish broadcaster, that broadcaster would not be self-sustaining, it would be part of a wider system, it would be part of a trading system. That means that it has to do business with the rest of the network and it has to do business with the world. Whatever is spent is, if you like, an investment in trying to do better by producing competitive programming and finding markets. That is only partly a solution. I do not think that that necessarily solves the problem of how the funding for broadcasting gets distributed around the UK system. It might be part of the answer, but I do not think that it is an answer in itself necessarily, because a lot will depend on its performance in the end. The Parliament accepted unanimously the report of the Scottish Broadcasting Commission under Blair Jenkins. At a stroke, the Scottish Government and Scottish Parliament could set up a Scottish digital network, invest the money and improve the creative economy and improve cultural representation from Scotland in addition to how the BBC improves its performance in the future. One of the questions for me for the SNP Government is why have they not proceeded with setting up a Scottish digital network? Would that mean that we would be paying for it twice, one for the BBC and once for the new Scottish channel? The digital network panel, which followed the broadcasting commission album that was reported in 2011, suggested that the channel be set up with a sale of spectrum that has gone, but suggested that the BBC take that over from 2017. I am suggesting that you could have a mixed funding model. The network panel did not want to recommend advertising or sponsorship, partly because that would hit the existing broadcaster STV and hit other people too. Although I have to point out again that the National Broadcaster in Ireland has a mix of licence and advertising. One has to say that looking at the SBC's recommendations, I would have thought that no avenue of funding should be shut off for discussion if that is the only way that we could achieve a national channel. Given that we have not got a method yet of providing a Scottish service, whether it is through a federal BBC or a dedicated channel, in evidence to a Westminster committee in September, it was highlighted that in Wales BBC spend per head is £122, Northern Ireland is £103, Scotland is £88 and London is £757 per head. How can we leverage more money out of the BBC bearing in mind that there is another round of cuts coming? I suspect that, when you talk to them, they may wish to verify the figures, first of all. They did not criticise them when it was raised by an MP at the UK Parliament in September. As it were, short-term, mid-range solutions and longer-term, more radical solutions to Scottish broadcasting. One cannot see into the future. If there are too many obstacles against the setting up of an actual channel, although, like Robert I have to say, I am not entirely sure what they are, since they do not seem to be obstacles in similarly sized nations or sub-nations anywhere else, but if there are those obstacles, the very least we would want to see is parity of BBC spend. I agree with you, but I then think that it would mean spend on what? If it were spend on bringing programmes, network programmes towards the end of their life to Glasgow for a little while and then going away again, then it would not be a great benefit. What we do not seem to have, and I do think that there may be a constitutional aspect to this in terms of parliamentary oversight here despite—and I take the point about the very good work of the Audit Committee—but I think it is very difficult to get a media and particularly media production strategy going in Scotland, which makes it easier to set up independent production companies and get work for them. I cannot cite you the figures, but if you look at Dublin as well as London where you look, it is not just work for production companies, it is a whole lot of collateral benefit in the creative sector. The trouble with quotas and adjustments in spend is that they might work for a year or two years and give people some work, but it is not a strategic build of an infrastructure. In that sense, you want to be able to spend money on media infrastructure the way you do in the fourth crossing or improving the M8. It ought to be part of our economic infrastructure. I think that you have got two choices. One is to go for, in effect, a Barnett formula for the BBC where you say how much is going to be spent per head in Scotland. The other way is to take the licence fee that is raised in Scotland, give it to BBC Scotland, give it BBC Scotland much more autonomy and allow them to spend the money as they think fit, opting in or out of programmes from London as they see fit. That is certainly the model that I would wish to pursue. Beverage has made in terms of performance. The BBC has lost its way clearly as happens with a monolith. We look at the revenue generation side as a business. In fact, the focus is almost entirely on reducing costs. Given the disproportionate situation that we have talked about revenue and expenditure in Scotland, it is inevitable that there might be a disproportionate impact on the costs in Scotland, which are primarily people who work for BBC Scotland. Wouldn't it be easier within a federal unitary board by setting up BBC Scotland as a separate company within the subsidiary of BBC Scotland overall, responsible for its performance, responsible for its revenue generation? That might be working with other BBC subsidiaries. Performance can be measured because clearly it is not today. You have made the point, Professor Beverage, that a pay should be related to performance and it is not. Wouldn't it be simpler just to say that it is going to be a separate legal entity with responsibility for its revenue and expenditure? Very well, with the current director General Lord Hall's wish for a leaner, fitter organisation in which decisions are made more quickly. That might help the BBC Scotland to improve its performance in a rapidly changing technological and cultural environment. I agree with you that that is the way that we need to go. It might not, from a BBC point of view—their response to that would be very interesting—it might be seen as the thin end of a dangerous wedge, too. I am very sympathetic to that. There is this critical mass question about the BBC that, once you start chopping bits of it off, that might not stop in Scotland. It might be a model that some of the BBC's detractors south of the border might want to use. I think that there is a genuine difficulty for the BBC. I have always, for example, opposed the subscription model for the BBC, because I think that it would be extremely dangerous. The BBC shrinks—you said that it is large and I think that many people think that it could be cut back, and it has been cut back to an extent. That would probably be seen as the BBC's danger. The other thing that I might say to you is that if that were a separate operating company, the question would arise why the BBC—would it still be the BBC? If it would not still be the BBC, why not a Scottish broadcasting company of the broadcasting commission envisaged? You have a general agreement on the unitary board level policy, but the operation—today—it is all mixed up policy and operation, and it is London centric. If you had that type of operation, wouldn't it be easier to measure the performance operationally? Does it not mean that the policy could not be an overarching policy across the subsidiary or parts of the federal circuit? I can see an attraction in that if there is not another solution for greater broadcasting autonomy. However, I am just anticipating that the BBC would be very nervous about it in case it created a model through which other bits of the BBC got broken off as well. I think that we are very nervous about the BBC now. One of the problems with what you suggest, however, is the often-voiced complaint that BBC Scotland is parochial. I watched Peter Watkins' documentary Culloddon recently, which is a landmark in television. It was not made by BBC Scotland. It was made by BBC London. So one would hope and wish or try to find policies that enable BBC Scotland, if it had devolution max, to have much more confidence in its programme making and its commissioning. If you just go down the parochial road, nobody is going to want that. What we want is vision and ambition. I should start with clearing an interest as I have a brother who works for the BBC. I want to pick up a couple of points. Professor Blane, you refer a couple of occasions to the situation in Ireland. You were fairly honest about the pros and cons. As I understand it, you have that advertising component, which presumably would be seen as a potential threat. Were there any kind of lift and shift of that model into the Scottish circumstance? I understand that another criticism of the way in which it is structured in Ireland is that there is an awful lot of money spent on imports. The ecology of production that is indigenous to Ireland is perhaps not as extensive as one might imagine for the range of channels that exist. Is that fair? It has been a constant criticism not just over RTE's performance but over TV3, the main commercial broadcaster, too. The response has been to commit to greater quantities—we are, I am afraid, to quote this here—but the response has been to commit to greater quantities of Irish production and the proportion of Irish production on an annual basis. That does not worry me enormously because we are, after all, talking about quite a considerable channel spread in Ireland. RTE2, for example, is aimed at a rather different market from RTE1. There is at least one channel, which is aimed largely at a youth market. Now, if you do that, you are going to import more, and across the whole of the channels, the total of your production is going to be smaller. We are envisaging a situation in Scotland where, in channel terms, we start from extremely modest beginnings. I am aware—I am sure that you will hear from people in the industry about this—of all sorts of good ideas for television series and programmes that do not get made. I simply absolutely do not buy the idea that we do not have the television talent here. It is absurd. We have got it in literature, in music, in theatre, in visual arts and everything else. In response to something that Robert said a little while ago, if you look at some of the best arts programming that you will see on the BBC network, you will have a BBC Scotland as one of the co-producers. There is a great deal of that. In fact, one of the attractions in having the ability to commission more work is that you retain more talent and you bring talent back. I take your point. There is no point in setting up new channels if you are not commissioning new work, but we have the talent to do that. I think that the problem at the moment is that we do not, as it were, have the patronage. On that specific point, you referred earlier on to the rise and fall of Pebble Mill. It illustrates the trends that any broadcaster will have to cope with and try to remain ahead of as best they can. Are there areas of strength where, in Scotland, almost irrespective of the model, we need to be playing to far more seriously than we are? We have always been very good in Scotland at factual and arts, but drama also. Maybe it is more for those people who represent the independent production industry to make this point. One of the difficulties in retaining the BBC as the sole provider of future development at Scottish Broadcasting is that you still have one commissioner. One of the difficulties for the indie sector in Scotland is, particularly if Channel 4 is not commissioning much, that it is the BBC that they are always dealing with. It has worked all right for one or two people, but it is worth making a marker for it because I know that you are talking to other people. If it is always only the BBC, that is where the patronage is. The advantage of some sort of even minimal channel spread is that you get more people commissioning, different people commissioning, and people can pitch to a wider range of broadcasters. So, if we ever got to the point where we had five English language channels in Scotland and we were worried about the quantity that we were commissioning, that would be a luxury for us just now. We are not anywhere near that. Why is the British television industry so much more successful in the British film industry? The British film industry has peaks and troughs over a number of decades. The answer to me is because the British state mandates the licence fee and that then gets invested into the British television industry and it allows over a period of time success. So, when I look at the relationship between Scotland and London, what I see is Scotland being the British film industry and London being Hollywood. That is the kind of paradigm that I have. So, what we need to do is invest fully the licence fee raised in Scotland, in Scotland, not just making programmes for Scotland but for the international market and the UK market and then we will get the success that the British television industry has had over the years through the licence fee. That probably brings on to a point that I was going to raise in the absence of a representative from the Royal Society. It may be only fair to point out one of the issues that they were raising. They talked about the asymmetry that there is across the UK and I think that you have all acknowledged that. Any new approach must be designed to strengthen the arrangements in different parts of the BBC but it must not be at the expense of reducing its scale or scope or its social relevance across the UK. It is important that the BBC's position as a global broadcaster should be underpinned by the new organisational arrangements and not weakened. How do we square that circle? I think that we are discussing this morning the very compelling demand for arrangements that speak more accurately to the demand that there is in Scotland. However, at the same time there is a recognition from BBC loyalists such as yourselves that what we have here is of value and that one must proceed to some extent with a degree of caution that we do not end up throwing the BBC out of the bathroom. I do think that that is right. I think that it is also important while we are having a discussion about the BBC that we should also think about the general questions facing public service broadcasting outwith the BBC. There are threats to the future of channel 4 which would have major implications for independent production for example. There is a continuous question mark over whether or not ITV is going to get bought over. What characterises a great deal of the British TV industry is actually that it is subordinate to US company interests in effect, operating here but nonetheless owned from outside. You have got some quite interesting trends going on which I think do have a direct bearing on whether or not the scope and scale of the BBC is not even more likely to be an asset to the UK as a whole irrespective of how questions relating to Scotland get sorted out. One of the things in relation to the discussion of channels and the discussion of programme making that we really have not talked about is the changing nature of consumption which everyone will know is a gravitation towards quite a lot of short form viewing which is related to television in some respects and others not. New entrants into the market particularly for long form drama which are quite a challenge to production of drama around the UK as a whole. Demographic changes particularly amongst young people but not exclusively by any means in terms of how they consume audio-visual content via mobiles particularly. One of the revolutionary changes for older people has actually been the use of the tablet to screen-watching so that there are many many things going on which are affecting the future performance of the industry as a whole and any sort of debate about this and any debate about channels really needs to take account of that quite confusing complexity which is still being worked out I think. Can I just check with something? You mentioned earlier the issue about quotas. It seems to be support for quotas at least in the short term. In my case. In general I'm asking. I wouldn't like to speak for these guys but I think short of any other solution a commitment to a quota is one way of recognising that not everything should be centred within the M25. Under the present arrangements are you agreeing that quotas are a useful thing? I think they're useful yes, I do. You wouldn't refuse a quota fix where one is on offer and it improves the revenue but it would still be a quick fix. However at the moment of course quota is a quota for not Scotland on its own but a much wider quota so my question really is would you support a change to the quota as part of this process we're going through so that there's a Scotland specific quota? Well there are upsides and downsides attached to that I think because the question is how do you calculate the quota? Well how do you calculate the quotas just now? Well it's in many respects it's a kind of a balance of forces calculation isn't it it's how interests get worked out but if you were to let's say you made an argument for Scotland that it was proportionate to population or something like that if Scotland's demographic weakened relative to the rest of the UK you know that would that would be a declining quota so that would not be a good basis for a quota so we'd have to kind of find arguments for a quota which are not totally tied to population for example I think. When Pacific Key was opened Michael Lyons and Mark Thomson at that stage referred to 9% being a floor not a ceiling so that sounded very good and then we got the weakest link then we got what on the road then we got question time which is run out of Glasgow but actually is UK wide so I think you need to drill down into the granularity of quotas but I'm in favour of quotas if as Neil says there's nothing better but Scotland deserves better. I just add there's more than one way of looking at parity because for example BBC Alpa is keen to get BBC making more programming for that station to put them on a par on a par with the Welsh channel so this is a multi faceted argument and I think we're going to come on to some of those facets you're doing with Gordon. Thank you very much convener Mary's already touched upon party the lift and shift situation and I was wanting to ask what your views were on what impact current BBC commissioning practices has had on Scottish-based production companies what you've viewed. The reason for asking it is I was looking at television network hours across all of the BBC channels and BBC outputs 31,000 hours of which Scotland's local output is 882. I accept it, it excludes network but music and arts they had 1800 hours of music and arts of which Scotland's population share would have been 156 hours BBC Scotland actually produced 29. Entertainment they produced 1100 hours Scotland's share would have been 96 hours we had two and comedy again 1700 hours for comedy Scotland's share 144 we actually had nine so I'm just wondering what you thought or you know how their practices were working bearing in mind what you said professor beverage about Waterloo road week is linked question time the lottery shows homes under the hammer which are all UK productions but based in Scotland not only that but given the fact we are sitting in the capital of Scotland which has the biggest international arts festival in the world by far I think BBC Scotland and the BBC's performance has been lamentable in relation to that although it has improved in recent years speaking as a consumer I don't have the data in front of me my feeling is that the BBC seems to pay more attention to Glastonbury than it does to Edinburgh festival and I would like much more attention paid to Edinburgh and much more attention paid to the Edinburgh festival and it's about getting the BBC to change its mindset and be aware of that yeah I mean I don't think you would expect a kind of prorata system where you went through every kind of television programming sport arts whatever and had some precise proportion of that being done in Scotland I think what you would like to see though and I suspect the people who actually produce do do independent production for BBC Scotland and the network will have more to say about this but I suspect what you would like to see is more more more more choice in Scotland over what sort of programming goes to the network I mean I one's impression is that it's that it's possible for Scotland to be stereotyped outside in terms of the sorts of programming that people want from Scotland the sort of programming which might be considered from Scotland what sort of things might be networkable for example and in what sort of area Scotland is seen as having strengths and I think that's where these kinds of decisions are not made here and taking Philip's point about the fact that we do need to look at the obsolescence of the channel idea over time nonetheless the strength of the channel is that you could if you can have these decisions being made inside a channel then you can develop strengths and you can get a channel which is perhaps very good at doing arts and sports or something of that kind and I think it's been very difficult for that to happen in Scotland both for the commercial broadcaster which is fitting into the network in a kind of in a particular pattern and for the BBC so I think in a sense the argument always goes back to where the autonomy is in commissioning and editing decisions as distinct from working with existing quotas and I agree with you that some of these figures you know don't make very happy viewing in terms of we asked the BBC regarding what counts as Scottish content and what they said was what qualifies as Scottish is set by offcom not by the BBC but is that by statute or by voluntary agreement I mean does the BBC have to abide by what offcom says or is a voluntary agreement as they've got is empty now it's not by statute no offcom do regulate the BBC for harm and offence and and probably in the future impartiality and accuracy and balance as well as far as I know offcom scrutinises the claims made about programs produced under the quota I think it doesn't go any further than that so I mean to say that offcom determines Scottish content I think would not be quite accurate at least in my understanding I think it's purely related to quota questions in terms of you know what the BBC have said about what qualifies as Scottish they have referred to the offcoms regional production where two out of the three criteria must be met but it all refers to outside the m25 and that has no reference to Scotland at all in what they've supplied to us and I'm just wondering whether the three criteria it's laid down which is in terms of production base production budget and production talent whether that should actually be built into the BBC charter for Scotland and instead of saying where it says UK outside the m25 should actually refer to Scotland specifically so for instance the first one would say instead of the production company must have a substance of business and production base in UK outside of the m25 it should say the production company must have a substance of business and production base in Scotland and whether that would address the problem that we're seeing where we'll get a lifting shift well in part I mean I've suggested there'd be a service licence for BBC Scotland per se but if you step back a bit and you look at what happened with Wales Wales got Dr Who in Torchwood now these were not Welsh representation although the locations were Welsh particularly in the case of Torchwood but they they were good economic policy this is where economic policy and cultural policy intersect with each other and certainly what I would keep on saying is the BBC has known for a long time that the audience in Scotland is unhappy with its product and unhappy with portrayal and that's where the focus should be and whether you do that by changing the public purposes which would be my preferred route or whether you do it by putting pressure on BBC management that's the road to go down and that's the problem that needs to be addressed I'm just wondering you've touched on most of the rest of what I was going to ask but how do we ensure that there's more local decision making in relation to commission and programme is it the specific Scottish channel or is it as a part of a federal BBC what would be the ideal way to go the BBC could make a decision to relocate commissioning I mean it doesn't it doesn't require any federalisation or it requires a sort of desire to decentralise and and to and to make it happen here I think really my idea of relocating BBC 2 or BBC 4 to Scotland was criticised in the second leader in Scotland on Sunday as just shifting the office and wouldn't change anything but if you not only shift the office as it were but you shift the commissioning power you shift the budget then you go into a situation where the independent production sector for example in Scotland doesn't have to pay a fortune to stay in a London hotel or go down by sleeper and that would benefit the industry in the north of England as well because they'd just be able to nip up to Edinburgh or Glasgow instead of having to go down to London again and that would contribute to a mindset shift in the culture of the BBC which I think would be too welcomed so you shift the budgets you shift the commissioning power suddenly you get change but there'll be a lot of resistance to this from Westminster and also from the BBC in London. I have heard in one or two forums that you may hear this when you speak to the BBC they declared intention to try to do that actually to try to move more autonomy towards BBC Scotland in that manner but one would obviously want to look at the detail of that. Ten months ago we had a producer report on the economic impact of film, TV and video games industry in Scotland and there was a call then to increase support for independent TV production based in Scotland and the relevant Scottish Parliament Committee should assess whether the BBC has made its production intent. Coming to the point that Professor Beverage has just made in terms of commissioning, you and Angus at that time head of commissioning for the BBC Scotland said and I quote we now this is 10 months later he said this 10 months ago we now need to ensure that the companies at the base in Scotland are winning entirely new business and are drawing from the local population and talent base. BBC doesn't care about Scotland at all does it? I'm afraid you're overstating that I think they do care about Scotland but they need to have the tools with which to improve their performance at Pacific Key. Back to Professor Beverage's point in relation to the Edinburgh festival and Glastonbury, I mean I suspect there's a degree of caricaturing it. I mean I think looking at the coverage for example of tea in the park as opposed to Glastonbury would be a more accurate comparison to make. It's not to say that there isn't more that could be done with Edinburgh festivals. I think you're absolutely right there but I think to downplay some of the stuff that they've done clearly catering as they see it to the same market, tea in the park would be a more relevant. It was on the point of quotas really community. I think everybody accepts that they're a fairly blunt instrument and sort of fashion criteria that are going to be, stand the test of time is always going to be fairly fraught but how do we manage the situation where there are co-productions where you've got different interests north south of the border and from across the regions of the UK taking part? Is there a way of assigning the different components to it more accurately rather than saying if you achieve a certain percentage then 100% of that will be allocated as a nation spend in Scottish terms for example? I think that's a producer question in terms of working out how that relates to criteria. I mean I would have thought it would be possible to allocate different elements to different parts. I mean one of the example gave us illustrated the point of lift and shift by suggesting around about 5% of the actual spend in Scotland could lead to 100% of the allocation of that spend as effectively part of Scottish contribution now by any stretch that's lunacy but if by trying to subdivide it does it get so complex in terms of the way that productions are put together that it's just too elusive? I'd have thought the more criteria have the more difficult it's going to be to resolve those questions. It will never be exact and it would never satisfy everyone. It's like what is the question about what constitutes a British film for example but I think you'll find co-productions all around Europe anyway when you've watched some of the programmes we import from Scandinavia for example. Scandinavia programmes will look at, see that these are co-productions with multiple partners and I think what will tend to happen if you're looking at inside the Netherlands let's say if people are going to talk about the proportions of Flemish co-production or something there are there are arithmetic for doing that which will probably be an exact and probably be debated but you could do it. There are excellent examples of co-productions at the moment it's called BBC working with MG Alba and BBC Alba produces very good programmes that also work internationally so let's put more investment into MG Alba. The chancellor recently in a decision which I regarded frankly is cheap and shoddy took the million pounds away from BBC Alba so I would suggest that this Parliament and this government restore the one million pounds to BBC Alba please and I think you'd get a lot of value for that investment. Can I just go back to the match light example? I mean I think that match light gave a particularly clear example of how the quotas could work not a real example but clearly it is feasible using the rules to as already been said that that programme could be deemed to be Scottish that 100 per cent of the budget allocation is deemed to be Scottish even though five percent of the spend is in Scotland. I mean is that frankly a sustainable position in terms of BBC Scotland and in terms of how we use the quota? The example I would give is going back to 1930s when we did have the Eadie Levy and quotas for British films and so on and what that led to around a decade ago and a decade later in 1940s was what's sometimes described as golden age of British cinema. Now when I look round Edinburgh at the moment and look at the multiplex cinemas I see it's completely dominated by Hollywood product and there's not a great deal of competition it's usually the same film which is on a number of different screens. I personally although this would be seen as authoritarian would like one screen in each multiplex cinema to be ring fenced for British or Scottish or international productions so the idea of having a quota is a good one because it ensures that you get the right kind of training for the creative industries personnel so keep quotas for the moment but maybe make them make them greater. If quotas are accompanied by longer term strategic development to enable a relatively stable media production centre they're fine but if there is substitute for strategy and building an infrastructure they're really not useful they're a way of avoiding it actually. I mean it seems to me that what we keep having in the Scottish broadcasting are short term tactical solutions to replace an absence of strategy. I think that that is fundamentally where we're trying to get to. I mean effectively the quotas at the moment if you take the matchlight example and some of the other evidence submitted to the committee it's about effectively meeting the rules but not actually delivering a long term strategy and investment in Scottish production it would seem to me. I mean I think for that reason it seems to me to be quite dangerous to place the question of the future development of Scottish broadcasting inside a wrapper marked future of the BBC. That's the wrong way around. I think the future of the BBC in Scotland should be in a wrapper marked the future of Scottish broadcasting and that's why in a sense I think it's a slight danger. We all agree that the BBC is enormously important. It's a huge cultural asset, we want it to survive but at the same time I think there's a slight danger in Scotland that we think that that is synonymous with the future of Scottish broadcasting and it might not be because for example I've just thought experiment here if we did have an autonomous channel set up by the BBC if such a thing were possible in Scotland it would be happening at a time when the BBC's very funding base UK Y does under attack it wouldn't be a good start. There might not be a good start. It might improve things enormously in Scotland. I have just a couple of brief questions about how the BBC meets the needs and demands of the Scottish audience and particularly how well they research the needs and demands of the Scottish audience. Do you have any knowledge of any of the research base as to how the specific interests of the different regions of Scotland and the needs and demands of those different regions are measured? A knowledge of conducting audience research for the BBC is now so historic that I would have to say that I don't know how they're doing it now. I mean I know in the past having conducted that kind of research myself that we did. I mean but I'm talking for charter review for 1996. I mean what we did exactly was go into a whole lot of Scottish regions actually and sample in about a hundred different places but you would have to ask the BBC in what detail they're doing that now. I simply don't know the answer to that. There's generally a snapshot and I know the BBC have undertaken research on the advisability or the proposal for a Scottish 6 and usually that research has not come back with figures which give enough support for it but my response to that would be well of course because that's just one pilot programme and it takes time. The history of the BBC is that the best programmes that they produce sometimes are not a success immediately on the Fools and Horses for example or Monty Python and a range of others and they take time to develop over a period of time for the audience to like it and for the creative personnel to hit their stride so research helps but what we need is a BBC in BBC Scotland with confidence to make the programmes not just that people want but that they don't know they need but once they do hit their stride they become great successes. Professor Bullion particularly have spoken about an additional channel and do you think an additional English language TV channel falls into that category that we've just spoken about that people want it but they don't know they want it or is there any evidence is there an evidence base that suggests there is a demand for an additional Scotland only English language TV channel? There's evidence of considerable dissatisfaction with what we've got now so the question is what's the best solution. Now I do think that one of the thoughts behind the SBC recommendation in 2008 was actually that was that this might be helpful to the BBC and I mean I've tried to say this my own submission that you might get the BBC off the hook if the BBC funded or even largely funded we're not talking huge sums here a channel which it didn't run and in fact because I I mean I actually think there's an argument which says that whatever the BBC does in Scotland is going to keep on being criticised and that one model through which the BBC could avoid that is be a visible funder of a channel which answer and it would actually in my view take some of the heat off the BBC it might not be a bad solution for the BBC and it would not actually involve a restructuring of the BBC's organisation which might which would otherwise threaten its critical mass so I would have thought that might be not entirely an unattractive proposition so I mean do we know if another to all I can say is that I know that both for the broadcasting commission and for the digital network panel which followed it up you know we did we did ask enormous numbers of people but I wasn't on the broadcasting commission I was in the follow-up but in terms of popular I mean I don't I don't sure if I know the answer to your question I only know that there is dissatisfaction at present and that people say that they want Scotland served better in terms of broadcasting provision that there is dissatisfaction but I don't think there's strong evidence that there's a desire for another channel and the research that was done by the broadcasting commission goes back to 2008 and since then consumption patterns have changed quite a bit and I think also at least some consideration might need to be given to what the effects of another channel would be for example on BBC Alba you know which which and just what is sustainable within Scotland also you know what what the effects might also be on on stv as the commercial incumbent so I think I think if the argument is to be strong then we certainly would need strong evidence for a desire for that channel and also to know in some detail what kinds of things would work I mean inevitably you can't cover all the bases and demand is not is not going to be clearly articulated but we really don't know very much about that and I do think that's an area that's been under discussed and so much of the debate you know quite reasonably has been about Scotland's creative economy and sustaining that and building up for example commissioning power but the desires of the audience really have not been part of the debate actually. I fully agree with Philip here very briefly because Philip's right in saying there may not be a demand for a channel but there is a demand for content that reflects our lives. Man and taking what Mary Scanan said to me earlier woman cannot live by still game alone but why is still game so successful it's because it puts on the screen the life of ordinary people in Glasgow and ordinary people in Aberdeen, in Inverness, in Dundee and in Edinburgh also want to see programmes which speak to them for them and about them and a channel would be one way of producing that. Two very quick responses to that. One is that people in millions are still watching television channels in real time and the other one is that for example the Irish language channel is not threatened by the existence of a number of other channels in Ireland and I take Philip's point but I think if you and I agree with him about changing viewing patterns but if you were to say to people in Catalonia or Ireland can you give your channels back because you're consuming more of your media content online you would get a very robust response. I mean I make the point that in fact in the Republic of Ireland another channel has started broadcasting last Saturday so there is clearly I think the last thing we need to worry about in Scotland is channel proliferation you know we've got two opt-out broadcasters in BBC Alpa I would not be worried about glut of channels quite the opposite. Can I just check finally with Philip you said that you would have to be clear before we'll launch this an extra channel or a new channel that there was a demand for that channel I mean how do you measure demand for a new channel given that people demand more programming as I think as I've said they demand new content they don't necessarily format it in a demand for a new channel. I agree with you I think that. Sorry secondly could you tell us what demand was there for the launch of BBC 3 and BBC 4 before BBC launched those channels? I don't remember a huge public demand for those channels. No I don't remember any public demand for those channels at all. No no do I. There tends not to be I mean BBC Alpa would be a specialised example where there was an obvious demand but mainly there isn't you're right. Thank you very much and I thank you all for coming this morning and giving your time to us. I'm going to suspend briefly. If I can now move on to our next panel and of course we're having this in a slightly different format and around table format. I welcome to the committee Janet Archer from Creative Scotland, John Archer from Independent Producer Scotland, Donald Campbell from MG Alpa, Paul Holleron from NUJ Scotland, Bill Matthews from Bectu and Council Scotland. I welcome you all to the committee this morning. We're going to try and cover some of the same ground that we've just been through with the previous panel. It's not a panel as such so I'm quite happy for people to intervene and hopefully join in the conversation rather than restrict committee members' questions and panel answers so hopefully we'll be able to get a bit more of a free-flowing discussion going in the next hour and a quarter or so. I want to begin with the before and ask Colin Beattie to kick us off with the governance and accountability issue. With the previous panel we had a bit of a discussion on federalism, the appropriateness of federalism, what federalism indeed meant but we certainly had a consensus about more devolution in the widest sense being needed in terms of BBC in Scotland. I'd be interested to know what people feel about the pros and cons of a federal structure and how it might look. If you could try and keep your answer reasonably short, I would be appreciated. Who wants to start us off on this? Bill? I'm happy new year to the committee. I think the fascinating evidence earlier on from the three professors and I think there was a resounding impression left that the word federalism means lots of different things to different people so we need to be really really careful how we use it. If I speak from my position as chair of the audience council in Scotland, I think if you had asked audience members and I do an awful lot of consultation with audiences, do they want federalism? I think that you get quite a lot of blank looks. If you said to them, do you want more content that represents your lives in Scotland and gives you news and current affairs that speaks to you, that you feel that the BBC in Scotland is the BBC for the audience in Scotland much more? I think that the answer would probably be a quite resounding yes. The terminology is difficult and I think that there's a level of detail when we start talking about governance and structure that in my other role as BBC trustee for Scotland we're engaged with the David Clementi review which is in fact looking into structure, governance and accountability and we as national trustees have not yet met with him but we meet with him in the next few days so I don't want to prejudice any of that discussion that the devil in it would be in the detail I think but if we take that back to audiences I think audiences would be quite keen to see more of their own lives reflected in what they see and hear of the BBC output. John. I agree with that. I think essentially in Scotland for broadcast production we're chronically underdeveloped. We are subject to the imperial power of London, we are a colony and I think we're at the position that Churchill was after the second world war when he said we can't let the colonies rule themselves, we have to control them and I think we deserve better. I don't think the BBC in London get the new Scotland, I think we need a radical change and shift in emphasis, I don't think we need any quick fixes, we need something which is bold, I think we do need the equivalent or better of the Scottish Parliament and Westminster, we need some freedom, the money raised in Scotland should be spent from Scotland, Scotland should decide what is made here, money does give power and in broadcasting the ability to say yes is all important, nobody at BBC Scotland can say yes to a network production, that's just, that's terrible, we deserve better and I think we should imagine better for Scotland. I think there's a real requirement for a federal structure, not to show how that would pan out but there's no point in having that level of accountability unless there are resources then as John says I think it is key, the whole thing is key to how much money that BBC Scotland have to spend and in that way decision making in Scotland for Scotland and also for a wider BBC would be far more effective and there's no point in having a federal structure if we still have to go cap in hand to London and beg them for changes and for more resources, the resources are the main issue but a federal structure would at least allow us to make more decisions in Scotland that would then benefit a wider BBC as well. Can I take one point that Bill just made there about what do we mean by federalism, I mean we heard from the first panel various views on what that actually means, whether or not it's actually federalism, whether the impact on the rest of the UK of a federal structure in Scotland, what would that be and are we talking about decentralisation or are we actually talking about federalism? Well I suppose there's a bit of both, there's a crossover, a clear crossover, I don't think he can separate the impact, I would hope that he wouldn't separate the impact that spending in Scotland would have on the rest of a BBC, a federal BBC structure because we would be quite keen that programmes made in Scotland would be going on to the network so there needs to be a close knit operation across the whole of the BBC, the nations and the regions, I think part of the trouble is that we have a London centricity that is unacceptable and with more decision making in the nations and regions, more resources in the nations and regions to make local and national and international programmes then that need for a federal structure would be required rather than just a decentralisation because there's no doubt about it that the links need to be maintained in respect to the programme making, the commissioning and obviously the links with independent television producers as well. Again when I spoke to the previous panel an integral part of whether you have a federal structure where you have devolution, an integral part of this question is tied up in the actual oversight, the accountability of what the BBC does in Scotland, what it spends in Scotland and so forth. The question is do we have an adequate accountability at the moment? Would a federal structure bring us better accountability? Is it necessary to have a federal structure to have that greater accountability? What would that greater accountability actually boil down to? From listening to the last part of the previous debate and also the opening comments on this debate, I think that we need to be very careful about generalising too much. In the first few minutes what we've heard here is a call for much greater decision making in terms of what's made in Scotland, what's spent in Scotland and very quickly jumped that across to demands placed on what would go on the UK network. I think that we would share the concerns and the views that there has to be much greater accountability in Scotland to Scotland about what the BBC does. There has to be much greater control over what BBC Scotland does within Scotland. In terms of UK network spend then you're talking about an agreement with other bodies about what Scottish production would be broadcast at UK-wide level. I think that it's dangerous just to generalise very quickly in terms of just smashing the two things together and saying we want more of everything. The means to achieve those different things would be through different methods. I think that we would also have to be careful about in terms of the federalist question about we would certainly be looking at more of a decentralisation. We're not offering a solution on what the federalism would look like but I think it's important never to forget that BBC Scotland and other parts of the BBC benefit enormously from economies of scale across the whole of the UK and to go too far down one road of saying we're going to completely isolate one element of the BBC. It could have an enormous impact on that in a negative way. It follows on from Paul's comments to an extent. I was interested in the three panellists that we had in the first session, all were at pains right at the outset to nail the colours to the masters BBC loyalists. It was interesting but helpful in that some of the voices in the debate at a UK level make no secret to the fact that they see no relevance for a BBC going forward. I would say that there are some voices within the debate in Scotland who are coming at it from a different perspective and probably have a similar endgame in mind. It would be helpful to know from the contributors here whether there's a common view that the BBC, as an entity, albeit reformed in whatever way people see fit, is something that we need to hold on to and value. I know that it's the most important cultural institution in the UK. I think that it should be in Scotland, and it probably is, but we just want it to be better. We want it to make programmes that connect better with the audience in Scotland and also want to see it play its part in building the production industry here. The lift and shift, as you've discussed, was a quick fix, but that was nine years ago. As a quick fix, it's become addicted to it, it's like a dangerous drug and they need to get off it pretty quickly because it's not helping the industry here. Quite clearly, the BBC is massively important. It's important for the culture, for democracy, for the economy, and the BBC trusts recent proposals to add the BBC to the public purposes of the BBC and enable economic growth, which is very important. If you take two massive brand assets, the BBC and Scotland, and you put them together, what a powerful combination you could have and should have on an international stage. If you ask the question, what should a federated or devolved or decentralized BBC look like from Scotland? Put those two things together and test it from the international perspective. Colleagues of mine were at an international content market in April of last year. There were 83 from the Republic of Ireland, more than 100 each from Denmark, Sweden, Finland and Norway. There were less than 10 from Scotland. I think that with decision making and financial accountability in Scotland, with a BBC worldwide, which was not just working out of London but a BBC Scotland worldwide, you'd have fantastic, tremendous potential. Again, coming back to the point of generalisation, I was particularly dismayed by some of the comments about lift and shift operations. For the purpose of the debate, we need to be very clear about what we are talking about. I am quite sure that producers in Scotland are hugely opposed to lift and shift operations, but I would be dismayed and our members would be deeply upset if anybody was suggesting that the likes of the weakest link on Waterloo Road, which provided months and months of high-quality work to many hundreds of freelancers working in Scotland, should not be brought here. At the end of the day, our members, the thousands of people who work in the industry in Scotland, want to work in Scotland in any prospect or any idea that production should not be brought here because there is some debate about where all the money goes, would be hugely horrifying to them. Yes, we want a strong producer base in Scotland, but we also want a lot of high-quality work in Scotland. We will take Waterloo Road, the weakest link, because it keeps the studios in Glasgow busy and it keeps our members working. From those productions, our members have also been put on to a number of network productions that have gone out to work in the likes of the Olympic Games with BBC London to gain more experience. Again, if we are talking about building the producer base in Scotland, that is fine. If we are talking about work for people in Scotland, that is a different thing. Again, we need to be careful there. There are a number of people who want to work in Scotland, but I am slightly puzzled by that contribution. If we build the producer base, if we build the indigenous industry, surely we build jobs for your members and more members? Yes, absolutely, but that does not mean that we want to have a holistic approach, because Paul made the comment. We want to be taking our products out with Scotland as well. There is a danger. Just as with the film studios that Paul made over the years, we have had the debate about Scottish film studios and the industry has universally agreed that the Scottish industry could not sustain a film studio in Scotland. What Scotland could sustain is a commercial studio operation that sells its products abroad and which helps to build the industry in Scotland. Equally within the television industry, we want a strong producer base that will eventually, in the longer term, increase employment levels. However, in the short to medium term, what we are saying is that we should not be opposing bringing products to Scotland. Any organisation in Scotland, any Scottish company, will look to bring work to its workforce in Scotland, and that is what we are saying. The weakest link was not a Scottish concept, it was not a Scottish idea. It provided a lot of work to a lot of people in Scotland. Over a longer-term strategy, yes, we can build up the producer base and build up the indigenous producers and the work that comes from them, but we should not discount bringing work to Scotland. John Artran. Paul Matz mentioned that he came to Scotland to die, sadly. He did not leave any residue. The producers went home to London, and the people who worked on them here were left looking for other work. If those projects had been developed here, the IP would have stayed here, which would have been invested in further productions and further work for your members. I think that the example that you gave is just about the worst that there was. In my experience, if you look at the levels of work that have been in BBC Scotland, they directly correlate to who is the head of that genre in Scotland. If you look at the periods when there have been high levels of drama in Scotland, there has been a particularly successful and strong head of drama in Scotland, regardless of where the commissioning was. It is the same in entertainment, it is the same in factual, and it is the same in children's. Where there is a good head of department in Scotland, Scotland gets the work. Where there is not a good head of department, then Scotland does not get the work. I think that there is more to it than just blaming the commissioning process. I do not want to interrupt myself, but is not that part of the problem that we are effectively continually fighting to ask for work from somebody else? If the decision-making process and the budget and the commissioning process were in Scotland, then the work would be there. Is not that the fundamental point? I do not disagree that if there was more control in Scotland over more money, then yes, clearly there would be more work in Scotland. However, we can point to periods in history, and they have been mentioned in the various submissions about the mid-90s, the early 2000s. It was not the commissioning process directly that led to those increases in work, it was a strong and creative head of drama. Some of that work was network commissions which were in danger of losing if we isolate them. I am not saying that we should not have more control and more money in Scotland, yes we should, but at the same point we have to be careful about disenfranchising ourselves from the network. I do not think that I am saying that problem anyway, but Paul Holleran and then George Adam. Just in response to Liam's question about commitment to the BBC, the BBC has enemies on a number of areas. For example, the news paper industry sees the BBC as rivals, which I think is a really unhealthy situation. I think that there is a lack of partnership approach on both sides. One of the dangers for the BBC of BBC Scotland in particular is that there is no change. It is quite gratifying to hear Bill saying that there are discussions about the start, about the new management structure, because there is a need for that more than anything. However, if you look at the submission that BBC Scotland management put together as part of the initial charter renewal bid, we were pleasantly surprised how ambitious they were, but it was with a view to saying that we want £150 million to spend in Scotland, we will expand our news and current affairs coverage, we will make more drama, we will put more music programmes on, here is our plan, and after the budgetary discussions it was totally kicked into the long grass and I think that is unacceptable. That is why welcome this debate and that is the type of argument we need to get into to a look at the management decisions, the budgetary decisions, how much budget is spent in Scotland, like the previous three guests where speakers were talking about before. That type of budgetary decision needs to be taken as well as the management structures. However, if we had budgets that BBC Scotland were looking for, then I am quite sure that there would be less need for lifting and shifting. At the moment, I can see where Bechtew's concerns would be that if that work does not come here then there is a real death of work for their members and other trade union members. However, if there is a larger budget and there is more control over how that spending is carried out, then I think we would be in a far more advanced situation. I think that a larger share of the money raised in Scotland being kept in Scotland to make local programmes, but also for the national network and even on an international market, the quality of our independent sector is there to be seen by everyone. I think that a closer partnership between the BBC and that sector can raise the game for a broadcast in Scotland. There are other examples that have been mentioned today with regard to the commissioning. The example that was mentioned earlier was Dr Who to BBC Wales, and it is the quality of the product and what you get back. There is a series that has been going for 10 years. The difference was that that went to Wales because the BBC wanted Russell T Davies to do it, and he said that I am only going to do it if I do it in Wales. What I am trying to say here is the fact that it is about what we are actually putting out there, what does the Scots audience want, does the commissioning make the difference. I think that that is our perfect example. Why can't we go back to the time where we had, and I am slightly biased being from Paisley, John Burns, Tutti Frutti in 1987, drama that was very successful both from a creative point of view and I believe that it is networked as well. You have got that, you have got Crow Road in the mid-90s as well, the Crow Road in Banks' Crow Road. Why are we not getting to a place where we in Scotland can actually get product that we want, and it is not just the still game scenario where we are watching, because it is the only thing that comes from anything that we relate to. Is it the commissioning? Is it the fact that one of the ideas that was brought up by Professor Beverage was, he said, quite radical, get BBC 2 and BBC 4 in their entirety, one of them to come up to Scotland and commission everything from here? Is that a way forward? Is that a way for us to look at things? When you talk to people, they just want to see content that relates to their life and how they go forward. Is it not about more the long-term goal, something that is sustainable, that we can get instead of getting the scraps, such as Waterloo Road and the week's link? A couple of minutes ago, Beverage said that BBC Scotland is quite ambitious about expanding programming, including news. In the submission that we have from the BBC, the BBC believes that it is time to come for it to strike a better balance between the delivery of pan-UK news and news tailored to the distinct of needs and agenda of the devolved nations. I was just wondering how that fitted with the fact that you are saying that all of that has been cut. I have referred back to the start of 2014, when people knew what was coming in 2015 for Scotland, where we had the Commonwealth Games, the Ryder Cup, the commemoration of the start of World War I and, of course, the independence referendum. Decisions were taken to introduce massive swinging cuts in BBC Scotland at the start of that year. To me, there is no logic in that decision whatsoever. Moving on, we are in a position where the submission for the charter news from BBC Scotland management, and Ken Macquarie has addressed the workforce on it. He spoke to the workforce and the unions and explained the ambitious plans. Both of us, who are believers, gave an evidence next week for BBC management. Partly came out of one of the meetings and said, there is now nothing for the nations and regions. Now, who made that decision? Who made that decision just to back off completely from quite ambitious plans, which I believe were being seriously considered, but then told that it would have been kicked into the long grass? It is not just about Scotland, it is about Wales, it is about Northern Ireland, it is about the knock-on effect throughout the whole of the BBC, and that is why I think a federated structure will work. However, the decision-making process in respect of budgets on where to spend is something that, to me, is a serious danger to the future of the BBC. If I can go back to the question that Liam asked a little while ago about loyalties, I would probably get a front page if the BBC trustee and audience council chair said that he was not a fan of the BBC and a fan of public service broadcasting. I think that it is a fantastic organisation, but it does not get it right all the time. There are many places that you can point to where I am sure that it could do better. If I can pull this conversation back to what audiences maybe want, because I think that that is quite important too. If you look at the data, audiences in Scotland consume a lot of BBC outputs, whether online, on TV or on radio, and it is not dissimilar to what the rest of the UK is on average consumes, and on TV it is a little bit more, they tend to appreciate it a little bit less than the rest of the UK, which is an important point for me for the audience council. I boil it down into too many areas where I think that there is work to be done. I do not know that those are areas that need to wait for a charter review to be fixed, but we happen to be there and there is a good time to talk about it. I think that provision of news and current affairs for the Scottish audience is really important. I think that it has become increasingly difficult for the editors of our network news programmes to put together a succinct bulletin that addresses the needs of every corner of the UK. I welcome Tony's recognition and writing to the Scottish Government and the other devolved administrations seeking some views on how BBC can do that better. I am sure that he will talk a little bit more about that next week when he is here. The second part of it is about representing and portrayal of the audience that the BBC is serving. That is about recognising the distinct culture of Scotland, recognising the lives that people live in Scotland. It is about representing the Gallic culture as well. That is all down for me to the commissioning process and how commissioning works is still, after 10 years in and around the BBC as a volunteer and as a member of the trust, still a bit of a mystery. It surely should not be that we depend on where somebody is located or who somebody is to get the best of all of the UK out of the commissioning process. There is something about building a process that works. We are dealing with all of that in a decreasing financial envelope. The BBC has saved £1.6 billion over the period of the charter. We are dealing with that in an environment in which bits of England do not think that they are represented even as well as Scotland and similar debates are going on in Wales and Northern Ireland. For me, there is an issue about how we align the commissioning process, perhaps through a purpose in the new charter to more effectively represent all of the UK within the BBC's output. Interestingly, Paul Horne mentioned one word, which is internationalisation. I get the feeling today that we are talking about that we are in this UK bubble and how we are going to transfer production, et cetera. If I look at Outlander, which is not for the BBC, in terms of its export capability, perhaps Janet can make some comment given that the economy committee looked at exports in the creative industries, or I look at, as I mentioned, Outlander and other cases where we have the capability to export. I get this terrible feeling, apart from the structure that we have to talk about, this retrenchment, the idea that this is the bubble. I know that they do export, but not to the extent. We have this retrenchment mentioned earlier about how we cut costs, what we do, and not enough emphasis on using the talent that we have in Scotland in terms of production and through commissioning of what the further market would take. We are not just doing that. We are living in this bubble, and we are talking about BBC overall UK and what we need to do in BBC Scotland. The way that we do that is that we do federalise or regionalise and release the talent that is available in each of the areas of the UK, and start looking to become a bit more assertive in what we can do. If Denmark can do it with Bergen, I am sure that we can do it with other programmes. Professor Beverage made earlier about the Hollywood idea that, given outside, frozen should have been produced in Scotland. Just to pick up on Bill's point, first of all, in terms of the commissioning process, I think that you will find there is a mystery to most BBC managers as well, and it is a process that, back to what has been hugely critical of. I do not ever recall being at a meeting where we would have a clear answer from the BBC, and I think that Paul will back me up in this about what is actually happening. At any given stage in the commissioning process, you have just got a shrug of the shoulders, and it is all down to the commissioning process, so anything that could help to improve that process would be helpful. Again, going back to the comments made by George about the likes of Tutti Frutti and other popular programmes, again they were made at a time when there was a strong head of department in Scotland who championed those programmes and fought for them. They should not have to fight for Scottish content and Scottish output. The support should be there, but the more important point that I wanted to make was in relation to talking about taking over BBC 2 or BBC 4. Again, going back to Paul's comments, we are in a situation where the BBC may not have BBC 2 or BBC 4 for much longer, given the proposed licence fee settlement and the charter renewal discussions. The BBC is facing losing a fifth of its budget over the next five or six years, and we are talking about real cuts, real closures of service, and many thousands of jobs going on. I think that we cannot lose sight of that in terms of the debate that we are having about what we want from the BBC going forward. Perhaps you made the comment that this is probably the ideal time to have the conversation about what Scotland should get out of the process going forward, but we cannot lose sight of the many hundreds of millions of pounds. The BBC has effectively been told to hand over a blank check in terms of the over 75 provision, and I think that that is something that the committee cannot lose sight of. There is a challenge thrown down by Chick there about the role of Creative Scotland, but there is a question mark about what is Creative Scotland's role here in terms of the small independent producers and the industry in general and what role it has in terms of what it expects to get out of the charter renewal process? Obviously, that is a very good question. Creative Scotland is an organisation with about 100 people in it, and the BBC has something like 1,000 or maybe a bit more, so that gives a sense of the proportionality of scale. Nevertheless, we have the scope for influence and injecting some thinking about potential for the future and innovation for the future in a context where the broadcasting landscape is changing. We heard earlier from the previous panel about the different ways that audiences are consuming content. Young people very rarely look at a television screen. I think that they are much more interested in other kinds of platforms. We have to take that into account in terms of how we think about policy for the future, but on the international point, I think that that is a very good point. There is a phrase that is used in the BBC studio's proposition as it stands. It talks about local only content that has relevance to a particular place. I would argue that in Scotland's instance, because there is so much interest in Scotland globally from so many people who have connections back into Scotland that you might be able to use your local only as much more of a global proposition, you can start to think about local global in a very tangible way. Our focus in thinking about this is fairly straightforward. It is about greater commissioning power for Scotland from Scotland. It is about that point that was made about IP and finding a way of negotiating more opportunities for Scottish indies to be able to benefit from the IP that they generate. Often that gets lost in the way that things work at the moment. It is not good enough, I do not think. I think that we all feel that there could be better representation of Scotland's culture on BBC platforms. Clearly, there are lots of views in terms of what that might mean in practice, but nevertheless, even I feel as someone who moved to Scotland just two and a half years ago now, I feel that I do not see as much as I would like to see in respect of the extraordinary things that happen in this nation in as prominent ways as they could be seen. That is certainly a conversation that we have with the BBC and will continue to have with the BBC through all of the different relationships that we hold. The BBC is clearly an important—it could make a huge deal of difference if it chose to, and if the hearts and minds argument that was discussed earlier were one. I think that there needs to be better systems of accountability. We talked about what that might look like in practice, but I have noticed that the structure, for me it is not just about governance, it is also about the day-to-day management of how things are run. At the moment, I am noticing that there is an executive board and an executive team, and as far as I can see, Ken Macquarie sits on the executive team, not on the executive board, so potential for a small shift there might make quite a big bit of difference when it comes to those decisions that were being discussed in relation to news or other things. I think that there are day-to-day small shifts that could happen in terms of getting more out of what we have got now, as well as thinking about the bigger picture and what that might look like for the future. I would like to say on the drama point that there was great drama in the 1990s, the Tutti Futi taking over the asylum. It is about money again. After those things were made, the money for drama in Scotland, which had sat in Scotland and was decided on in discussion with London, went to London. After that, the drama that we have had from Scotland has been much poorer. It is true, poor. What are the great dramas of the last 20 years? Again, if you look at when there has not been great drama, John, and look at who was in charge of drama in Scotland as a direct correlation, if you look at when there was great drama, then there was a strong-headed drama. The money was here and then it went back to London. I very much enjoyed watching capital, the John Lanchester novel, about the housing market in London, which was on the BBC in September. However, how much more would I have enjoyed watching a dramatisation on the BBC of something like James Robertson's The Landlay Still, which might have explained something about the whole devolution debate and vote of 18 months ago? That kind of thing is not getting on to the BBC, and it should. The UK is the poorer for it. I think that the evening standard is the best new play award, but we haven't seen those broadcasts as yet. I will just take your time. You will not be surprised that, coming from Orkney, I am slightly apprehensive when there is discussion of the Scottish culture. Clearly, Donald will speak to the success of the BBC album reflecting a different image of Scotland, but there is a risk that it becomes quite binary. It is either Gaelic or it is a kind of central belt perception of Scotland. I think that throughout this, is there space for some sort of debate about the wider reflection of the diversity of culture from north to south and east to west in Scotland? There have been good examples of how in Shetland we tap into the Scandic Noir, even if it is not necessarily an accurate portrayal of what goes on in Shetland. Trawler has given a rather industrial bird's eye view to what happens in the fishing industry in the northeast. There are good examples of that, but I think that the concern that I would have is that when one talks about the Scottish culture from the perspective of those in the Highlands and Islands, I suspect that, similarly, in the south-west and in the borders, there will be a concern that that is very much a view from a specific key or from the offices of the Edinburgh festival, for example, rather than necessarily something that reflects the messiness and the diversity of culture across Scotland. I want to open up some of the discussion that we had with the previous panel on the issue about the income and expenditure and how it currently operates or, well, do we even know how it currently operates given the information that we have at the moment or don't have at the moment? Gordon, you led us off on the previous panel on that issue. I think that it was actually Mary, but I'm quite happy about it. Sorry, I do apologise. Mary, it was you, I do apologise. It was me, yes. I do apologise. Sorry, Gordon. I thought I'd sit here quietly. That went through me, Mary. Take the habit of a lifetime. Can I just, first of all, say that I think what the committee, I would really want to do is to put forward a very positive suggestion. This is a brilliant opportunity to have an input into the BBC Charter, and I would hope that what we put forward and I hope that we can have a debate in the Parliament, and I hope that it's a very positive debate. In future, the Audit Committee will obviously be looking at the BBC Scotland's annual accounts. They will be looking at how effectively that money is spent. They'll be looking at the money raised in Scotland and production and quotas and whatever else in Scotland. But in the absence of that, and can I also say that the Audit Committee amended the memorandum of understanding, so we've already had a significant input. My question, I'll just lump it together, is to say I appreciate that the Audit Committee haven't had annual accounts yet, but I just really want a comment about where we are on audit. This is something completely new, given that this Parliament was set up in 1999. But in terms of accountability, if I could just ask what proportion of the licence fee would you like to see spent in Scotland? This would be obviously a precursor to how we should be auditing and monitoring. Are quotas an effective measure? We've heard differing views from the previous panel, or is it just an artificial market? We've heard from people here about commissioning. It's quite a mystery. If that's a mystery, that means it's very difficult for quotas. I would like to see something going forward that would include the independent producers. Personally, I don't find your talk of imperial power very helpful in this context, but never mind. What other options would you find sustainable for the production sector in Scotland? I'll just finally roll it all together, convener. Should the charter, because this is an opportunity for us to have input into this charter, should it enshrine a specific quota for network production, or what positive point do you want to ensure that we have more Scottish culture, more jobs in Scotland, more reflection of how we live in Scotland? How can we ensure that that is enshrined and moving forward in future? I commend the BBC and, particularly, BBC Alba on the coverage of the mod. That is phenomenal. The traditional music and song, and the pipe band championships—somebody mentioned Glastonbury earlier—Bella Drum, which is the Highlands equivalent of Tea in the Park, is regularly on BBC Alba, and a lot of local talent there as well. I just say that your recognition and commitment to traditional music, pipe bands and so on in Scotland is far greater than creative Scotland, where it is barely even on the agenda. That is my question all in one. There is a lot of it. Before I bring in Paul Holleran, just for clarity, there is nothing in the memorandum of understanding that says that BBC will provide BBC Scotland accounts to this Parliament. Yes, there is. No, it is not. You can look at the memorandum of understanding and that is not what it says. The memorandum of understanding, as I understand it, would have to get it and have a good look at it, is that BBC Scotland's accounts will come to the Scottish Parliament's Audit Committee. No, it says that— Because we would have no locus on UK BBC. No, it says that it will submit the BBC's annual report and the BBC's accounts. That is right. Not BBC Scotland's accounts. There is no such thing as BBC Scotland's accounts. That is the fundamental question. I raise it because there is an issue here that we should not be misled that there is a separate set of BBC Scotland accounts that are produced that would allow us to analyse those accounts. There is no reason why we can look for the breakdown of BBC Scotland's income and expenditure within those accounts. That is what the Audit Committee does week on week, so that does not prohibit us from getting that information. No, I absolutely agree with that. It is just to make sure that we are not more clear that the memorandum of understanding does not say that specifically. But the Audit Committee is capable enough of seeking that information. Question 10 that we submitted to the BBC just before Christmas. We said that could BBC Scotland provide its annual accounts and or a statement of its financial activities in 2014-15. They basically said that it does not exist. Consideration is currently being given as to how statistical information pertaining to each of the nations, including Scotland, may best be incorporated and presented within the BBC annual report and accounts in the future. That is fine. That is exactly what we are looking for. But it does not exist. That is important. But it is going to be there in the future and that is what it is all about. Well, it may be, but I think that is part of the argument, but Paul Holler has been waiting. Do you think that that is part of the accountability where BBC Scotland has made available in the future? In respect to the proportion of how much money should be retained in Scotland when the submission from BBC Scotland Management to the original bid for part of charter renewal was £150 million, which is less than 50 per cent. I am not sure how they came to that figure. I am sure it will be there for negotiation for the future, but it would be a start position. I also think that the quotas would be part of a support structure and leading into that as well in respect to discussions across the broadcasting industry, including the independent companies and including SGV. With the BBC on how those programmes are made. But I do think that it needs to be part of an agreement whether it comes with a federal structure or whatever decentralisation, but that there should be an agreement reached on a fixed amount of money to be retained in Scotland. I am just back from Spain last night and noticed that there is a new station there in Andalusia, which feeds in from Cadiz right the way through to Canada, from Saville down to Malaga. Constant news, and they provide just constant news and cultural magazine programmes, 24 hours a day. It is a new station that has been set up there as part of the TV Espanya, and if they can do it, they will see why we can't do it. Okay, thank you. Chick Brody. In terms of whatever the audit is, I can ask that the Public Audit Committee ask the question, or if they can ask the question and we will ask it through an FOI, as to what management fee is charged by BBC or a portion of their management fee is attributed to Scotland. It would be interesting to see what proportion of Scotland's revenue finds itself into the management fee structure of BBC UK. Okay, thank you. Given that we are on quotas that was mentioned just a moment ago by Mary, for example, I mean, do people support the continuation of the quotas even in the short to medium term? Do you think that quotas are an effective way of making sure that there's money in what comes to Scotland? If you do support quotas, do you think that the current arrangement of quotas, which is a wider quota, and as an umbrella covering not just Scotland but other parts of the UK, is the way that it should be set up, or should there be some different form of quotas? Donald? The quota system has been useful to, as Paul has said already, in many ways in bringing work to Scotland, but it has not delivered the long-term benefits and the follow-up, if you like, that it should have. There is a certain use to quotas. Where the quotas have failed is that there has not been a strategic plan underlying the quota system, which is focused on the growth of the indigenous production sector in Scotland. With the quota system should have come a partnership strategy. How does the BBC partner with indigenous production companies and with producers in Scotland, because the people who bring the work to Scotland are the producers? The drama producer is the person who will hire the director, who will hire the crew, the cast and crew, put everything into motion, who will work with the scriptwriters to bring the project to life. A partnership strategy has to lie hand in hand with any quota system. Probably a better system in terms of what we are looking at would be a devolved financial accountability system, where the licence fee that is raised in Scotland is accounted for by the management of the BBC in Scotland. Allow the management of the BBC in Scotland to divvy up the licence fee in a sense, and say, this is how we propose to spend it. This is the bit that we will pay for the iPlayer. This is the bit that we will share with the infrastructure of the UK. These are the joint projects that we will do with the rest of the UK. This is what we think the audience in Scotland needs. This is our five-year business partnership plan with the sector in Scotland to grow domestic production for audiences in Scotland, for audiences in the UK and audiences globally. If the audit committee is looking for something to measure the BBC, you could measure it on the pipeline and the co-production and co-investment capital that is being invested by the BBC over a period of time into UK-wide and international projects and measure the return on that as well. We are also in danger of being too focused on cuts, cuts, cuts all the time. What about the plan for growth? We have enormous assets with the BBC and the Scotland brands together. We need to work them together. On the specific question of quotas, I was around as a member of the BBC Broadcasting Council when Mark Thomson made his famous network supply review speech. I have to say, and I think that my colleagues in the BBC trust would agree with us, that the network supply review, which is our internal language for the quota system that exists today, has had a positive impact. It has definitely created opportunity and talent development, skill development in Scotland. It is a bit of a hard concave metric. Looking back at it now, at the point where numerically it has been achieved, we all sit back and say that we can design something better going forward, something that, as well as looking at the impact of the economy, which is important and looking at how that spend has been spent wisely to reflect the lifestyles and the culture of Scotland. It is going to have to be enhanced. The other thing that Robert Beverage made earlier about the lumpiness of the spend that it has gone up and down over a period of time, is sustainability. We all want to see a sustainable production sector in Scotland. I have to say that that is not only the BBC's job, there are other people involved in the sector, but the BBC is such a big part of it that it has got to play quite a leading role. However, I do not know how we manage that in, but it would seem to me that, although I certainly would not favour writing percentages into a royal charter, there needs to be something at a higher level in there that then speaks to another commitment that is detailed elsewhere. Partly to answer Liam's original question and hopefully to address some of Mary's points, we would see the current arrangement in terms of how the BBC operates in terms of percentages with the independent sector, how it operates with the rest of the UK, as being something that should be built on and moved forward, not something that should be dismantled and torn apart. I agree with the comments that Donald was making, that we should be looking at a more organic nature between independent companies and the BBC, so that the BBC can help these companies to develop and grow. Indeed, I have worked with the BBC over the past few years on training projects to help to develop producers to a level that network commissioners are happy with. We have already, in a small way, started down that path. In terms of quotas, I agree with Bill's comments that the NSR has been positive for Scotland, it has been a help to Scotland, it has brought more work to Scotland, it is disappointing that such a crude mechanism had to be kind of forced out of the BBC in the first place. Again,