BECTU challenges BBC Resources Ltd

BECTU has launched a campaign against plans to hive off 4,500 BBC staff into a new subsidiary company.

BECTU plans to challenge BBC plans to convert key sections of its Resources Directorate, including studio centres, its post production department and its outside broadcast bases, into a Limited company, wholly owned by the Corporation.

This follows the BBC Board of Governors approving management proposals about the Resources group on 19 February.

The union believes that the move is unnecessary and threatening, and has warned that the BBC could be hit by industrial action if staff affected by the move are not given cast-iron guarantees about their future job security and conditions of service.

BECTU press release on BBC Resources Ltd 20.02.98

Letter distributed to union members after the announcement:

BECTU's first meeting with the BBC to discuss BBC Resources Ltd. is on Monday 23rd February, and negotiators will be calling on the management to justify a decision that the union regards as unnecessary and threatening for the staff involved.

Union representatives will also be tabling a list of demands covering job security, preservation of existing terms and conditions, including pension rights and the redundancy formula, and the future of collective bargaining, particularly pay claims which Resources Ltd. is likely to handle separately from the rest of the BBC. Industrial action cannot be ruled out if management withhold these guarantees.

In addition, the union will raise the fears of many staff in other BBC directorates that the creation of Resources Ltd. is just another step towards the Corporation becoming a publisher/broadcaster, rather than a programme-maker. The BBC will also be asked why none of the senior managers who are involved in setting up Resources Ltd. will be employed by the company, continuing instead as direct BBC employees.

Management are already aware that the union plans to increase its lobbying of the Department of Culture Media and Sport, who have not yet approved the plan for Resources Ltd. The Culture Secretary has said: "I will wish to see representatives of BECTU and other relevant unions working at the BBC before reaching a conclusion".

Over the last year management have claimed that, to offset falling BBC business, Resources needs to increase its external commercial work (which the union does not oppose incidentally), but is being inhibited by European and UK competition laws. Resources Ltd. is necessary, they say, to avoid falling foul of these rules.

According to the union's legal advice, however, there are opt-outs in the legislation, specifically designed for public service broadcasters, which would allow Resources to engage legitimately in the kind of external trading that management envisage, without setting up a limited company. As far as the union knows, the BBC has not tried to use these various opt-outs to protect itself from any complaint that commercial projects are being cross-subsidised by the licence fee.

The management's fear that Resources Directorate could build up a dominant position in some facilities markets is refuted by their own figures - out of this year's projected income of more than £400M, only £35M will come from commercial activity. This represents just a small percentage of the BBC's own work, and is a drop in the ocean compared to the size of the outside facilities sector.

One of BECTU's many concerns about Resources Ltd is the aggregate trading position of the business units involved, which on union calculations are barely covering their costs at present. The BBC cannot cover any losses incurred by the company, since this would defeat the object of preventing cross-subsidy, so unless there is a sudden improvement in the business performance of units within Resources Ltd, a round of cost cutting seems inevitable. It is this risk that makes firm guarantees on job security and conditions of service so important. Significantly, the management have so far declined to reveal the staffing figures built into their 5-year business plan, leaving the suspicion that the new company may be planning to cut jobs.

BECTU, along with the BBC's other unions, also believes that the creation of the limited company, while not in itself a privatisation exercise, is one step towards the break-up of the Corporation, and could lead to an eventual selling-off of Resources Ltd. The decision to keep key strategic departments like News Resources and Information and Archives inside the BBC, instead of putting them in the new company may suggest that the business units included in Resources Ltd are ones that the Corporation thinks it could manage without in the long term if anything goes wrong.

Members can expect further reports on Resources Ltd. as the discussions with management progress, and should look out for union meetings in their areas.

The union's plan of action at present is to:

• consult members throughout the BBC
• question the need for a limited company
• table demands for guarantees on job security etc.
• ballot Resources members for industrial action if guarantees are not offered
• consider balloting all BBC members if Corporation-wide collective bargaining is at risk
• step up lobbying efforts to persuade the Government that the plan should not be approved.

UNION MEETING

1.15 Wednesday
25 February
Studio TC2 Television Centre