The British Broadcasting Corporation (BBC) was founded in 1926 under a Royal Charter (Charter) and continues to enjoy the same status to this day. From its inception in 1926 until 1954, the BBC had a monopoly on broadcasting. Even after 1954, the monopoly continued with respect to radio broadcasting, seen as the BBC’s traditional market, but an independent television station was licensed. Prior to 1981, this independent television broadcaster was under the same duty to provide broadcasting as a "public service for disseminating education, information and entertainment" as the BBC(123). In 1973, local commercial radio was finally authorised.

Royal Charters are granted for a number of years, the most recent for a 10-year period dating from May 1996(124). Royal Charters are grants from the Sovereign to undertake certain activities, often on an exclusive basis but in practice prerogative powers, including the grant of Royal Charters, are exercised by the executive. The BBC’s Charter is drafted by the Secretary of State for National Heritage. Procedurally, a Charter is similar to secondary legislation or regulations and is hence not subject to mandatory Parliamentary scrutiny. Significantly, decisions made by bodies established under a Charter cannot be subjected to judicial review. The fact that the Charter is periodically renewable and has the status of secondary legislation means that at least formally, the BBC is less secure than public service broadcasting organisations who operate under a statutory mandate.

A Licence Agreement (Agreement) between the Secretary of State for National Heritage and the Board of Governors of the BBC specifies in further detail the governance and public service obligations of the BBC. The Agreement is technically a contract between the Minister and the Governors, the most recent having been signed in 1996(125). As such, if either party wished to seek a legal remedy for any breach, it would probably be pursuant to contract law. The present Agreement provides at Clause 18 that it is not binding unless it has been approved by a resolution of the House of Commons.

As noted, the most recent Charter and Agreement date from 1996. Although formally no particular process is required for either of these documents to be formalised, the government in fact undertook a reasonably broad-ranging consultative process, involving a report by the House of Commons National Heritage Select Committee and a White Paper prior to the adoption of the 1996 Charter and Agreement(126). The government introduced a number of changes in response to concerns about the accountability of the BBC, for example by incorporating programming standards requirements directly into the Agreement(127) and by requiring greater detail in the BBC’s Annual Report. Similarly, the new instruments instituted a number of changes to governance, clarifying the roles of the Governors, National Councils and the Foreign and Commonwealth Office.

The Agreement authorises the BBC to provide a range of broadcasting services, including two terrestrial television channels and five sound programme services for general reception throughout the United Kingdom, one additional sound programme service for each of Scotland and Northern Ireland and two for Wales and a number of local sound programme services(128). These services are referred to as the Home Services. The BBC is also responsible for the World Service which broadcasts and delivers services to audiences overseas in a number of different languages. All of these services are provided by the BBC as a single corporate entity.

The public service mandate of the BBC is guaranteed by a number of provisions in both the Charter and Agreement. Article 3(a) of the Charter establishes the general public service obligation, namely to provide sound and television broadcasting programmes of information, education and entertainment as public services. The BBC is also under an obligation to ensure that it remains under constant and effective review from outside, including by public meetings and seminars(129). Any material changes to programming services must be preceded by an "appropriate process of public consultation."(130)

Far more detailed public service and content obligations are spelt out in the Agreement. Clause 3 provides that the Home Services shall respect high general standards, particularly regarding their content, quality and editorial integrity, and cover a wide range of subjects. Clause 5 elaborates on these standards, providing that the BBC should do all it can to ensure that the Home Services are balanced and serve the tastes and needs of different audiences, do not improperly exploit susceptibilities, do not contain abusive treatment of religious views, do not offend against good taste or decency, or offend public feeling, and are not likely to incite to crime or lead to disorder. In addition, controversial subjects should be treated with due accuracy and impartiality and should not, outside of limited exceptions, contain material expressing the opinion of the Corporation on current affairs or matters of public policy. The BBC is required to draw up a code giving guidance as to how these requirements may be observed in its services and programming, in particular as regards impartiality.

The BBC is also subject to the jurisdiction of the Broadcasting Standards Commission (BSC)(131). The BSC has a duty to draw up codes dealing with a range of issues including unjust or unfair treatment, infringement of privacy, standards of taste and decency, and portrayal of violence and sexual conduct(132). The BSC has the power to monitor programmes and to publish reports on its findings. It also has a mandate to consider and adjudicate on complaints relating to a breach of the above(133). In case of breach, the BSC may order the BBC to publish the decision in such manner as it may direct(134). In 1996, the BSC’s precursors (the Broadcasting Complaints Commission and the Broadcasting Standards Council) notified the BBC of a total of 685 complaints against it. During the same period, 78 complaints were upheld in part or in whole(135).

A number of specific duties are set out for the Homes Services. These include stimulating the arts and a diversity of cultural activity, providing comprehensive, authoritative and impartial coverage of news and current affairs and wide-ranging coverage of sporting and other leisure interests, broadcasting programmes of an educational nature, including a high standard of original programmes for children, reflecting the lives and concerns of audiences, and providing a reasonable proportion of local programmes for national audiences in Northern Ireland, Scotland and Wales and in the English regions outside London and the South East. In addition, the BBC must transmit daily an impartial account of the proceedings in both Houses of Parliament(136).

The Agreement provides that the World Service shall share the general commitment of the BBC to "maintaining high standards of editorial integrity and programme content and quality." Clause 9.4 provides that the BBC, in agreement with the Foreign and Commonwealth Office, shall publish long-term objectives which include the provision of accurate, unbiased and independent news reporting and provide a "balanced British view of those developments, and an accurate and effective representation of British life, institutions and achievements."

The BBC is also required to establish and maintain an archive containing a representative selection of the programmes broadcast and to make reasonable arrangements for access thereto by the public, either with or without charge(137). Finally, Clause 12 of the Agreement requires the Corporation to make appropriate arrangements to maintain a research and development programme in pursuance of its general objectives.

III. Governing Structure

The BBC is a body corporate, governed by a Board of Governors, as provided for in the Charter. The independence of the BBC is noted in the preamble to the Charter and explicitly guaranteed in Clause 2.1 of the Agreement in the following terms:

Three National and a number of English Regional Councils assist and advise the Corporation, particularly in their respective geographic areas. In addition, the Secretary of State – and in relation to the World Service, the Foreign and Commonwealth Office – is given substantial powers over the operation of the BBC. A series of obligations to publish information, most importantly in an Annual Report to be tabled before Parliament, also constitute part of the governance structure of the BBC.

The governing structure, both internal and regulatory, is not conducive to ensuring respect for independence in practice, notwithstanding the formal guarantee. Too much power is concentrated in the hands of the government, both directly and indirectly through its powers of appointment of the Governors. Crude interference in the running of the BBC is rare – though not unknown – but more subtle pressure undoubtedly exists and has been the subject of some debate. Despite this, it would appear that there was little support during the White Paper process in 1994 for reducing government control by establishing an independent broadcasting council to take over functions currently exercised by government or by making the BBC subject to the jurisdiction of the existing independent broadcasting regulators(139).

The Charter provides for the establishment of a Board of Governors. Article 7 sets out their functions, which include approving clear objectives and monitoring compliance with those objectives, ensuring that the Corporation meets the highest standards of probity, propriety and value for money, and setting the overall strategy for the various services (Home, World and Commercial). For the Home Services, this strategy should "ensure that the Corporation’s services, programmes and other activities reflect the needs and interests of the public." The Governors are also responsible for ensuring appropriate consultation with the various Councils and due regard for the views of listeners, for monitoring fulfilment of legal and contractual obligations, and for appointing a Director General and other senior members of management(140). Neither the Charter nor the Agreement sets out the appropriate relationship between the Governors and BBC officers and staff in any detail, although their respective roles have become clearer in recent years(141). These instruments do not guarantee the Director General any security of tenure and indeed a former Director General, Alasdair Milne, was summarily dismissed in 1987. Although it is clear that Governors have a legal right to assume control over programme matters, in practice they do so only in exceptional circumstances(142).

The Governors are appointed under the Royal Prerogative – in practice the Prime Minister – for up to five years and are eligible for re-appointment(143). No formal conditions are attached to this power except in respect of National Governors, as detailed below. Power to appoint the Chair and Vice-Chair of the Board is again part of the Royal Prerogative. Individuals cease to be Governors if they resign, are terminated under the Royal Prerogative(144), have interests which conflict with their governing duties, become bankrupt, suffer from a mental disorder or absent themselves from meetings for longer than three months without the consent of the Corporation.

One Governor shall be designated as the National Governor for each of Northern Ireland, Scotland and Wales, selected for "his knowledge of the culture, characteristics and affairs of Our People [in the relevant location] and his close touch with the opinion in that country."(145) Meetings of the Board must be held in each of these localities as well as in England. The Secretary of State prescribes the quorum and decisions are taken by a simple majority vote.

Pursuant to Articles 14 and 15 of the Charter, the power to appoint officers, as well as the power to fix rates of remuneration and conditions of employment, is vested in the Corporation, subject to a general duty to seek the views of employees on matters affecting them.

Most of BBC’s radio broadcasting and approximately 75% of its television output is original programming made for audiences in the UK(146). The Broadcasting Act 1990 requires the BBC to procure at least 25% of its television broadcasts from independent producers(147)and in 1997 it exceeded that target by nearly 4%(148).

The Charter establishes a number of mechanisms to help ensure that the BBC is responsive to public needs and accountable to the public. In general these fall into three categories: the role of the oversight Councils, powers granted to the Secretary of State or other government ministers, and obligations on the BBC itself, particularly to provide information to viewers and Parliament.

Article 12 of the Charter mandates the establishment of three National Broadcasting Councils, one each for Northern Ireland, Scotland and Wales, while Article 13 provides for Regional Advisory Councils in each area of regional television output in England. The Corporation bears the costs of the various Councils. The role of these Councils is to advise the BBC on local matters but they have no formal powers over the Corporation.

The Chair of each of the National Councils is the respective National Governor from the Board of Governors and these National Governors appoint the remaining Council members, after consultation with various representative bodies. These Councils regulate their own procedure and other internal matters, such as hiring. The Secretary of State may, in an emergency and where it is in the public interest, suspend one or more of the National Councils by notice in writing. The National Councils exercise the following functions, with full regard to the distinctive culture of their respective areas: monitoring public opinion and ensuring that the views of audiences are given due consideration, advising the BBC with a view to reflecting the interests of national audiences, assisting the BBC in formulating objectives for programmes specifically aimed at national audiences, and advising the BBC on potential programme makers from these regions. Each National Council must make an annual report to the BBC and, if requested by the Corporation, special reports.

The Chairs of the Regional Councils are nominated by the BBC and members are appointed by the Corporation with a view to ensuring broad representation of the general public. The Regional Councils have a general mandate to advise the BBC on objectives for programmes primarily for reception in their region, monitor the extent to which such objectives have been met and advise on other matters affecting the interests of persons in their regions.

Both the Charter and the Agreement grant substantial powers to various government ministers, frequently the Secretary of State, to regulate or require certain action of the BBC. Pursuant to Article 5 of the Charter, the Corporation must provide such broadcasting as may be required under any licence granted by the Secretary of State for Trade and Industry or an agreement with the Secretary of State or Secretary of State for Foreign and Commonwealth Affairs.

The Secretary of State also has the power, under Article 20(2), to require the BBC to satisfy him or her that provisions in the Charter have been observed and, should it fail to do so, to revoke the Charter. The Agreement may, pursuant to Clause 15, be revoked by the Secretary of State where, in his or her opinion, the BBC has not observed its obligation to transmit programmes efficiently, for any breach of its provisions which has not been remedied within a reasonable period of time, or should the BBC enter into an agreement for voluntary winding up.

The Secretary of State has, in addition, the power to give directions on the maximum or minimum number of hours of broadcasting(149), to require the BBC to establish such additional stations as may be specified(150), and to refrain from broadcasting any matter or matter of any class(151). The precursor to this last provision was used in 1988 to prevent broadcasters, including the BBC, from broadcasting any words or pictures of representatives of proscribed organisations, including Sinn Fein. The issue was the subject of an unsuccessful appeal to the European Commission on Human Rights(152). An even more draconian power is that of the Secretary of State, pursuant to Clause 8.3 of the Agreement, to direct that the stations of the BBC be taken possession of in the name of Her Majesty, where in his or her opinion an emergency exists which renders this in the public interest.

Any minister may require the BBC to broadcast any announcement or, where the minister considers that an emergency has arisen, any other matter. In both cases the cost shall be borne by the BBC(153). Clause 9 of the Agreement grants the Foreign and Commonwealth Office (FCO) significant powers in respect of the World Service. The BBC is required to conform to "objectives, priorities and targets" as may be agreed from time to time with the FCO(154). The BBC shall provide additional services, such as monitoring transmissions or recording material, as may be agreed with the FCO. The BBC is also required to agree general long-term objectives with this Office and to publish these objectives(155). Finally, the BBC is required to consult and co-operate with this Office regarding international developments and the relevant policies of the government with a view to planning and preparing its programmes "in the national interest."

The main reporting obligation on the BBC is the publication of an Annual Report to include the audited accounts along with information relating to finance, administration, objectives, editorial standards and measures taken to ensure compliance with these standards, research and consultation undertaken, complaints from viewers, and an analysis of programming. The reporting obligations in the present Charter and Agreement are more detailed than in former versions. The Annual Report, along with those prepared by the National Councils, is submitted to the Secretary of State who in turn presents them to Parliament(156). The BBC is also required to make available to all licence holders an annual Statement of Promises to Audiences, describing its services, standards and objectives.

Funding for the Home Services Group, which includes the Home Services and its worldwide commercial activities, and the World Service are accounted separately. In both cases, the most significant source of funding derives from public sources. Under Article 16 of the Charter, the Home Services has the exclusive right to collect the Licence Revenue which in 1999 provided £2.2 billion, or some 82% of the total budget of the Home Services Group. A further 17% came from commercial activities – which have expanded significantly in recent years – with the remaining 1% coming from various other sources(157). According to Clause 10.1(b) of the Agreement, Licence Revenue funds may not, without prior approval of the Secretary of State, be blended with revenue from any other source for the purposes of any services, thereby effectively precluding the BBC from advertising during its broadcasts. Fully 89% of the funding for the World Service comes directly from grants-in-aid provided by Parliament(158).

Over 62% of the Licence Revenue is spent on television, 35% for BBC1, 19% for BBC2 and 8% for regional television. Another 21% goes on the various radio stations and the remaining 17% is spent on fee collection and other costs.

The issue of funding for the BBC has been a matter of considerable debate recently and the latest White Paper concluded that this issue should be kept under review(159). One consequence of this is the inclusion, in the Agreement, of Clause 10.2, providing that the Secretary of State may review the means of financing the Home Services at any point after 1 April 2002. Clause 18, however, provides that any change in the method of funding would need to be approved by Parliament. In particular, the idea of further exploiting commercial activities is being stressed. This is reflected, for example, in an amendment to the Broadcasting Act 1990, introduced in the Broadcasting Act 1996, which allows the BBC to undertake independent, commercial broadcasting activities, either alone or in conjunction with private broadcasters, where licensed by the Independent Television Commission (the private broadcast regulator)(160). This is reinforced by Article 3(u) of the Charter, which allows the BBC to enter into joint ventures with other companies, subject to prior approval by the Secretary of State, to achieve any of the objects of the Corporation.