This is taken from the Financial Times:


Clinton raised concern on World Service cuts
By Ben Fenton, Chief Media Correspondent
Last updated: October 24 2010 22:34

Hillary Clinton, the US secretary of state, raised concern about how the UK’s public spending cuts might affect the BBC World Service only days before its funding was transferred from the Foreign Office to the BBC, according to people close to the discussions.

In a private meeting in Washington, Mrs Clinton told Mark Thompson, the director-general of the BBC, of her worries that if the Foreign Office imposed cuts on the World Service in line with the general reductions of its spending,  it could be badly damaged.

“The US government raised the issue of what the cuts would mean for Bush House [the radio station’s London base], including the education and human rights initiatives of the World Service Trust, which both the state department and USAid [the international development arm of the US government] have put money into,” said a person with knowledge of the talks, which took place 10 days ago.

Last month, President Barack Obama used an interview with the BBC World Service’s Persian television channel to respond to a controversial speech at the UN General Assembly by President Mahmoud Ahmadi-Nejad of Iran.

In a a deal thrashed out with the government in less than three days, the BBC took on responsibility for the costs of the World Service, currently paid for by a £273m grant from the Foreign Office. Senior Bush House executives believed that the grant could be cut by 25 per cent or even more had the funding stayed on the same basis, threatening huge reductions in the television and radio broadcasts that reach 240m people across most countries of the world.

There is no suggestion that Mrs Clinton’s concerns influenced the outcome of the spending-round deal reached by the BBC and the government.

Instead, Mr Thompson believes he can combine the World Service news and current affairs operation with existing BBC 24 and radio services in the corporation’s refurbished headquarters of Broadcasting House in London.

The six-year licence fee deal also included the BBC taking on funding of other broadcasting enterprises, including BBC Monitoring and the Welsh-language channel S4C.