The BBC fires back: report argues that corporation generates £7.6bn for Britain
• Privatisation would lose £4bn, says Deloitte
• Corporation fears threat from Tories and Murdoch


The BBC is to launch a fightback against its critics by claiming that, far from being a drain on the licence feepayer and squandering millions on on-screen stars and behind-scenes apparatchiks, it in fact generates £7.6bn a year for the British economy.
The corporation's senior management will this month publish a detailed report claiming that a privatised BBC would lose the country £4bn and that independent TV and radio production companies would be £1.4bn worse off if it wasn't for the BBC. It will also say that innovation such as its Freeview service has spawned a mini-industry worth between £90m and £250m a year and its commitment to employ 7,000 staff in Glasgow, Bristol and Cardiff, where it makes Doctor Who, generates around £200m in economic value.
The corporation ordered the figures from accountancy firm Deloitte in a move which reflects the growing threat that Mark Thompson, its director general, feels from critics including Rupert Murdoch, chairman of News Corporation which owns Sky TV, the Times and the Sun, and David Cameron. The Tory leader last year failed to persuade parliament to freeze the BBC's £3.6bn a year licence fee, leading to fears that a Conservative government will seek to dramatically curb its activities. James Murdoch, who runs his father Rupert's media empire in Europe and Asia, last year called for a "far, far smaller BBC".
According to insiders, the report on the economic impact of the BBC, commissioned by chief operating officer Caroline Thomson, is calculated to appeal strongly to policymakers' urgent need to promote economic recovery during the recession, and is aimed at turning the debate about the future of the corporation on its head.
"In tough economic times our decision makers need to find new ways of supporting jobs and businesses," said a BBC source. "They need to see the BBC not as part of the problem, but as part of the solution by creating and sustaining jobs, particularly when the market falters."
The decision to release the rebuttal came as the BBC came under fire for spending £3.9m on an arts celebration of its refurbished Broadcasting House headquarters, which itself cost £813m. The Sunday Times, a Murdoch-owned paper, yesterday reported the project included £25,000 to fly a model helicopter equipped with a camera over the building for two minutes. Last Thursday Thompson faced one of the toughest grillings of his tenure when PD James, crime writer and former governor of the BBC, used a stint as guest editing the Today programme on Radio 4 to tell the director general the corporation had become "like a very large and unwieldy ship ... recruiting more officers, all very comfortably cabined, usually at salaries far greater than their predecessors enjoyed and with a crew somewhat discontented".
Senior managers are hopeful the report, which will be billed as the first attempt to put a precise monetary value on BBC activities, will change an increasingly negative atmosphere around the corporation.
The Guardian understands it concludes the licence fee generates £7.2bn for the UK economy by supporting the independent production sector and other parts of the "creative economy" - more than twice the value of the licence fee. The figure rises to £7.6bn when the value of joint ventures, such as UKTV, owner of cable channels that run repeats of BBC programmes, is included. It will say that private sector beneficiaries of BBC investment include independent production companies who produce around 40% of BBC TV programmes around the UK, such as Spooks, Life on Mars, Waterloo Road, Who Do You Think You Are?, and Question Time. It is expected to find that the independent TV production sector, which Deloitte describes as "one of the crown jewels of the UK creative economy", would be around two thirds of its size if it wasn't for the BBC, a potential reduction of £1.4bn. Deloitte will conclude that if the BBC was run as a commercial concern around £4bn would be lost to the UK economy.
Thompson is understood to have already planned savings, in an attempt to safeguard the core activities of the corporation in the face of likely Tory cuts. He is expected to undertake to increase the amount of original British content commissioned by the BBC and confirm that the number of expensive American imports will be drastically reduced. He has not ruled out closing down channels and has also hinted that the extensive BBC website, which many newspaper proprietors complain skews the market for paid-for online news, will be scaled back.
Cameron is examining different ways of funding the BBC. A report by Greg Dyke, former director general of the BBC, is likely to recommend that the BBC licence fee is scrapped to save up to £100m a year.
It is also likely to say that the BBC should be continue to be publicly funded, probably through general taxation. But Thompson is worried that will threaten the independence of the organisation.

Auntie's boomers.

The BBC helps to underpin a multibillion pound British TV industry, commissioning series from independent producers that might not prosper if it did not exist. Pact, the trade body that represents independent production companies in the UK, estimates the industry generates annual revenues of £2.14bn. The main beneficiaries are:
• Shed Media, which made pre-tax profits of £11.9m last year. It makes Waterloo Road for the corporation.
• Kudos, which makes Masterchef, Merlin and Spooks, is controlled by Shine, which is owned by Rupert Murdoch's daughter Elisabeth. The private company reported profits of around £24.5m last year, when it said its UK business was "going from strength to strength".
• Mentorn, the company behind Question Time, is part of the Welsh group Tinopolis, which recorded profits of £2.56m in 2007, the last year it made its accounts public.

By:- James Robinson

Source:-
http://www.guardian.co.uk/media/2010/jan/04/bbc-report-corporation-generates-mon...