BECTU submission to the ITC review of the programme supply market

26 September 2002

BECTU submission to the ITC review of the programme supply market.

Introduction

1. BECTU welcomes the opportunity to respond to the review. As a trade union representing thousands of workers - both staff and freelance - in the independent production sector and also in the broadcasting companies, we have a strong interest in the outcome.
2. Our area of interest is, however, different in many ways from a corporate interest. We have not, therefore, attempted to address all of the specific issues and topics raised in the ITC Guidance document. Instead, we have focussed our response solely on those aspects of particular relevance to our members.
3. We can declare from the outset our strong commitment to a healthy and vigorous programme supply market in the UK, incorporating both in-house production by broadcasters and independent production. However, against the grain of much recent comment, we are not at all convinced of the need for further legislation or regulatory interventions in favour of independent producers. On the contrary, we believe the current balance, based on the independent production quota, has served the sector well and that the long-term interests of all our members (whether working for broadcasters or for independents) are linked to the vigorous defence of a strong in-house production base within our major broadcasters.
4. We acknowledge the context of the forthcoming Broadcasting Bill. Many of the 'measures needed to encourage a strong UK original production base' are available within the scope of the Bill. In our view these should encompass strengthened commitments to ITV regional production; no lifting of the bar on non-EU ownership of broadcasters; and the maintenance of a strong and proactive rather than 'light touch' system of programme regulation. Within this background context we will focus below on the more specific issues raised in this review.

The independent sector

5. We recognise that the successful growth of our independent production sector has fostered a view, in many quarters, that further supportive measures are now necessary to allow it to move beyond the constraints of the current 25% quota system - whether through reform of the quota or alternatives such as the proposed enforceable code of practice. We believe, however, that the business lobby for the independent sector should not go unquestioned and that its self-interested and self-serving arguments should not always be taken at face value.
6. The public image of the sector is of the small producer pitted against the larger broadcaster; of the creatively-driven independent battling for rights against the bureaucratic corporation. This matches the founding vision (and to a large extent the founding reality) of the sector as a flowering of small and creative independents outside of the mainstream broadcasters. That image is now far from a reality. There has been a significant concentration of ownership within the sector - especially in terms of the proportions of commissions won. There has been a growth of ownership links between independents and broadcasters (whether domestic or foreign) - as the histories of Endemol, Pearson, Talkback, Ginger and Planet 24 can testify. There is no close match between independent production and broad ranging creative excellence - with lifestyle and light entertainment programming proving very corporately rewarding. In summary, the independent sector can now be seen as falling into two tiers - the large corporate independents with regular flows of broadcasting work and the much smaller enterprises relying on individual ad-hoc commissions.
7. We can, however, agree with the independent lobby in one respect - the commissioning process is far from transparent. Our concern is that it does not reveal in sufficient public detail the extent to which the larger independents have preferred bidder status. We would like to see publicly accessible information on the proportions of commissions allocated to the leading independent companies. It would be wrong if broadcasters (to fulfil quota obligations) and large independents (to gain business) were to develop a mutual interest in allocating much of the independent quota in this way - without being held fully and publicly accountable.
8. Furthermore, we are opposed to any proposal for independents to have enforced equal access to all relevant in-house commissions. While this would self-evidently benefit independents we believe this would be far outweighed by the potential damage to broadcasters' in-house production. If this were enforced, we foresee a resurgence of a de facto internal market within the BBC - with in-house units forced to bid to in-house commissioners. The BBC's previous experience of an internal market was widely viewed as damaging to programme making; overly bureaucratic; productive of wasteful transaction costs; and ridden with chaotic and unstable employment practices. We believe any tendency to a return to this approach should be avoided - not only in the interests of our own members but also of programme-makers and ultimately the viewers.
9. We conclude this section with a reference to three groups who we believe do not benefit from the top tier independents' lobby:
• Firstly, smaller regional independents have long complained that their interests are secondary to the large London-based companies. The independent sector has not, in the final analysis, produced adequate results in terms of regional production. We would therefore like to see and agreed minimum proportion of the independent quota allocated to independents based in the regions for programmes made in the regions.
• Secondly, many ethnic minority independent producers believe they have lost out to larger preferred bidders who consistently win a high proportion of commissions. If the independent sector represents a genuine attempt to open-up British broadcasting to a wider range of views and experiences, this problem deserves a much more urgent address.
• Thirdly, independent production companies are employers. With honourable exceptions, the experience of our freelance members working in the long-hours, fixed-term contract (or no contract) culture of the sector has not been happy. Independents complain about broadcasters' budget cuts but then collaborate in a self-destructive way by cutting corners - and particularly, by cutting freelance rates and lengthening freelance hours. We find a contradiction between the progressive public image and the practical reality of the independent sector.

Broadcasters' in-house production

10. As indicated, we believe the current balance, based on the independent quota as it is, should be retained. A critical mass of in-house production is necessary for the health of our broadcasting sector as a whole. Without this, we fear a fragmentation of the UK's production base and the loss of our ability to produce high quality programming in all genres, not just those which are commercially attractive.
11. The recent history of the sector is one of the progressive shrinkage of the broadcasters' in-house production base - with significant reductions in production staff and the closure of production units and studios in both ITV and BBC. A further current concern is the agreement on 'standardisation' of ITV regional hours, which we fear will lead to further reductions in ITV regional production. We see no merit in measures which will encourage any further roll-back of in-house production.
12. Far from small independents facing dominant broadcasters, we now face a situation in which the leading London-based independents are larger than some of the regional ITV franchise-holders they negotiate with for commissions. In recognition of these changes in market power we believe it is now appropriate to redefine the terms of the independent quota to apply to all work commissioned out of house, whether from independents or from other broadcasters - so that the BBC, for example, could commission work from Tyne Tees and count this as part of its independent quota obligation. We note that the Joint Parliamentary Committee has recommended that such a proposal be given consideration by Government.
13. We believe such a measure can help preserve the appropriate balance between in-house production and the independent sector. We further believe, - amid the strong, not to say strident claims on the merits of independent production - that the merits of in-house production should also be recognised:
• Public services broadcasters can only properly fulfil their obligations for programming catering to all tastes and interests by retaining a strong in-house production capacity. Independents face no such obligations and can choose to focus on programme genres which are more narrowly commercially attractive.
• Broadcasters can take a long-term view on programme investment and can afford to allow greater creative risks.
• Broadcasters, despite continuing cutbacks, have a larger base for genuinely regional production than the independent sector has ever been able to establish.
14. Most important of all from our viewpoint as a trade union, broadcasters with permanent production staff can invest in the industry's labour force to a greater extent the independents can ever do:
• Who trains the industry labour force? It would be easy to demonstrate how the BBC in particular invests far more in training than the independents, who nonetheless benefit from the skills of individuals who subsequently move into the freelance labour market.
• Any serious address to equal opportunities - whether in respect of gender or race - can only be made in a context of long term employment patterns rather than the casualised labour market of the independent sector.
• Sensitivity to the corporate self-interest of the independent sector should not, in our view, be at the expense of the industry's workforce on which, in a very labour-intensive industry, the independent sector itself relies.

Copyright

15. The last issue we wish to address is that of creators' rights. We regret that the review appears to focus solely on the corporate disputes over rights between independents and broadcasters. In this context the rights of individual creators become invisible.
16. We believe that a key requirement is for fair and transparent codes of practice, which respect the rights of individual creators in relation both to independents and broadcasters. We take issue with independents' arguments that they suffer unfair treatment in this area, when from our members experience the very same companies are no better than broadcasters in their treatment of individual creators - with standard contracts which routinely exploit differences in bargaining power to extract the assignment of all rights.
17. Progress in this area is possible - as, for example, in the BECTU/DPRS/DGGB agreement with the broadcasters in respect of directors' rights. We hope that independents would also commit to such agreements with individual creators rather than treating rights as a purely corporate concern. We also hope that in changing any of the terms of trade with broadcasters on rights, the independents would commit themselves to reinvesting any additional revenue from rights into future production - in the same way that BBC Worldwide revenue is ploughed back into BBC programming. Without this, any redistribution of rights revenue could entail a net loss to overall production investment.

Conclusion

18. We support the current balance between in-house and independent production. We believe that a strong base of in-house production is necessary for the long term health of the sector as a whole - in terms both of the quality and range of programming and the maintenance of a skilled audiovisual labour force in the UK. We therefore hope the review will not mistake self-interested corporate lobbying on behalf of the major independents as necessarily an accurate or comprehensive analysis of the needs of the sector. Further measures which - directly or indirectly - lead to the roll back of broadcasters' in-house production are, in or view, precisely the wrong direction for our industry to take, especially at a time of the broader changes to be instituted via the Communications Bill. We hope you will note the views of those who work in the industry, as well as the corporate views of independents and broadcasters.