A UK government panel enquiring into the funding and governance of the BBC is expected to report next week and propose changes to dilute the licence fee and change the way the board of governors is constituted.

Panel Member Howard Davies has told the ABC’s Media Report about the new proposals:

“If you ask people whether they are content to pay the licence fee, on the whole, they are. And therefore you are faced with the position where even if theoretically this is not a very sensible way of funding a broadcasting organisation, in fact it’s something which people are reasonably content with.

So we felt that for the time being anyway, the licence fee should continue to exist. However, technology is changing, such that before too long, it will be quite possible to switch the BBC channels off for people on a particular set; if they’ve got a digital box on top of their set, you’ll be able to say, ‘Look, if you don’t want BBC we’ll just switch all the BBC channels off.’ At which point it becomes quite difficult to force people to pay for something which actually you can easily deny them.

At the moment of course there’s the free-to-air problem: you can’t actually deny people the ability to watch BBC if they have a television set.

And so, in the future it may well be that the distinction between a licence fee and a subscription service becomes somewhat blurred. Once you can switch people off, then the licence fee is effectively a voluntary payment and therefore looks a bit like a subscription service.

Now we’re not quite at that point, so our view was that the government should continue with the licence fee for the time being, but within five years’ time, they should review it…”

Commenting on the Board of Governors Daviesl says:

“Well we think it’s a mess. And we think that the governors’ attempt to be both the regulator of the Corporation on the one hand, and the management board and the cheerleaders for the Corporation on the other, is doomed to failure.

And the Hutton Report showed some of the problems, but in fact I have found the more I’ve looked at it, that Hutton has not been the central issue. The central question is that over the last 15 or 20 years, we’ve learnt a lot about regulation and about corporate governance in other areas of economic life, whether it’s companies or indeed other parts of the public sector. And we’ve learnt that there are differences in terms of role between those people who are setting a regulatory framework and those people who are operating within it.

Furthermore we’ve learnt the importance of independent directors…”