This is taken from The Guardian:

Ofcom: BBC board needs radical reform

by Tara Conlan
Wednesday June 8, 2005

TV regulator Ofcom has renewed its call for radical reform of the BBC board of governors, urging the government to stick with proposals for an independent body overseeing all public service broadcasting.

It has rejected proposals in the green paper to establish a "BBC Trust", the government proposal for a replacement body to the board of governors, saying that the changes do not go far enough.

Government critics say the BBC Trust is just the board of governors by another name - and Ofcom has now firmly placed itself in this camp.

It is in favour of proposals made by the government independent adviser, Lord Burns, who suggested six months ago that another quango should be set up to slice up public funding, a proposal that won the backing of Lord Birt, Tony Blair's "blue skies" adviser and the former director general of the BBC.

Ofcom says the proposed "BBC Trust" should "evolve into an external independent body in the future".

The regulator's response to the green paper on the BBC's royal charter, published today, suggests the new body proposed by the culture secretary, Tessa Jowell, should be used to allocate public money in future to other broadcasters.

And Ofcom says the government should change the name of its proposed BBC Trust, branding it "inappropriate".

It says it should be known simply as "The Trust" which Ofcom says is "less possessive".

'New model of governance' required

It says: "If funding is to be directed beyond the BBC in future, a new model of governance and accountability will be required. Ofcom believes that the government should therefore consider how the trust could evolve into an independent body, external to the BBC and with responsibilities beyond the BBC, to meet that future requirement."

"The green paper notes that 'BBC Trust' is only a working title for the new body. We therefore ask government to reconsider whether the BBC Trust is an appropriate name for a body that has a potential future role in serving the wider public interest (for example, would it be appropriate for the 'BBC Trust' to be responsible for allocating funds to Channel 4?). The less possessive "The Trust" may be a better title."

Having had fewer powers than it had expected, or hoped for, transferred to it from the BBC in the green paper, Ofcom has maintained that the corporation should be subject to more external regulation.

It says: "Cross-sector content regulation should evolve by the middle of the next charter to ensure clear and consistent high standards for all broadcasters - rather than a two-tier system which implies that only the BBC can be relied on to provide a gold standard.

"The more the BBC is seen to observe accepted and independently scrutinised rules, the more likely it is to retain wider public and industry support."

Signalling its disappointment that the government did not wholeheartedly embrace its proposal for a £300m public service publisher, Ofcom has maintained the BBC should not be the sole recipient of public money.

It has reiterated its belief that in order for public service broadcasting to survive, other broadcasters should be given public money to make merit programmes, not just the BBC.

The regulator warns the government that securing the future of the corporation is "not the same as securing PSB for the future".

Ofcom urges government to bring forward OSB review

Ofcom has also called on ministers to bring forward their planned review of public service broadcasting by two years to 2010, before digital switchover.

"Prior planning and early action are needed to help ensure that other PSB providers remain in the system alongside the BBC. This means bringing forward the government's reviews of PSB funding to ensure that they are completed by the end of the decade." The regulator also calls on the government to tighten up the BBC's competition and fair trading commitments.

"Ofcom believes that to secure a level playing field in a rapidly changing market, all organisations in the sector should be overseen equally, by an independent competition authority able to respond quickly to market distortion or abuse."

The BBC dismissed Ofcom's insistence that the corporation should share public funding with other broadcasters.

A spokeswoman said: "The board of governors published its positive response to the green paper two weeks ago. It welcomed the government's approach to the funding of the corporation; to the proposal for a ten-year charter; and to the decision that the corporation should be governed through a new BBC Trust. "The board expressed a fundamental opposition to the idea - floated in the green paper - that at some future stage the licence fee might be divided for use by other broadcasters. This would both damage the BBC's independence, and weaken the overall impact of finite resources on the provision of public service broadcasting."