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David Clementi, the former deputy governor of the Bank of England, has reported on BBC regulation and concluded there should be an end to 94 years of self-governance by scrapping the BBC Trust, he calls for “fundamental reform” of the way the corporation is governed.
The Clementi report, which forms part of the government’s review of the BBC’s royal charter, recommended that the communications regulator Ofcom should handle all regulatory oversight of the broadcaster.
Clementi said it would be difficult to “achieve a clear separation” of BBC Trust and BBC, noting that even if it was possible, there would still be the issue of “two organisations sitting in one legal entity……. Not surprisingly, best practice requires regulator and regulatee to be in different legal entities,” he said.
“Regulatory oversight should pass wholly to Ofcom, which is already the public service regulator for the UK’s broadcasting industry and has the ability to look at the BBC in the context of the market as a whole. Ofcom would be a strong regulator to match a strong BBC.”
Clementi also recommended that the BBC’s day-to-day operations be run by a unitary board, headed by a majority of non-executive directors.
His recommendation that full responsibility for regulation be handed over to the media regulator Ofcom is no surprise , given the almost universal consensus – including the Trust’s chair Rona Fairhead – that the trust is not fit for purpose. The BBC Trust, a system of governance that replaced the board of governors 10 years ago, has been blamed for several management failures with its dual nature of both champion and regulator seen as ineffective.
In a press conference, Clementi blamed the “flawed” model of BBC governance for several failures over recent years including excessive pay and a botched IT project. He said there would be “no hiding place” for BBC failures in his proposed model and called for the role of chairman of the BBC unitary board to be full time.
The BBC said: “Sir David Clementi has delivered a thorough and insightful report. We share his view that external regulation and a unitary board for the BBC will bring greater clarity to the corporation’s governance. If delivered, these proposals will bring about the most significant change in governance and regulation of the BBC in its lifetime. That is why it is important they are implemented in a way that strengthens the BBC’s editorial independence and ensures that future decisions about the corporation are made very clearly in the best interests of audiences, who own the BBC.
“A move to a single external regulator with strong powers will provide assurance to the market that the BBC is independently regulated. It will also provide an opportunity to look at the type of regulations in place for the BBC – with the opportunity to move from detailed, prescriptive rules to a greater and proportionate focus on audience outcomes and service quality.”
The BBC Trust chairman, Rona Fairhead, said: “Sir David Clementi proposes a strong BBC board and a strong external regulator – a change we have argued for. It will be important to get the details right and we now want to work with the government to ensure roles are clear, the structure is effective and the BBC’s independence protected.”