BBC told to set plan to reach "underserved" audiences as cuts hit Scottish services

New data shows that the amount of time that an adult spent watching broadcast BBC TV dropped by 30% from 80 minutes a day on average in 2010 to 56 minutes in 2019.

And the National Audit Office is pushing the BBC to produce a long-term financial plan as soon as possible that sets out the next stage of a savings programme, and how it will fund its new strategic priorities.

Some £43m efficiency savings have been made to the BBC's budget for the Nations and Regions in 2019/20 alone which have indirectly hit BBC Scotland.

Questions were raised about the the adequacy of the £32m a year earmarked for the BBC Scotland channel, which launched on in February, 2019 and has since been identified as at risk if it had to pay for free TV licences for over-75s.

And in June, last year, it emerged that 60 employees are to be cut at BBC Scotland as the corporation revealed that it had to save £6.2 million.

Staff were told that while various savings had already been identified, the broadcaster would have to reduce the number of staff in Scotland.

The NAO, in a series of recommendations called on the BBC to "set out a plan to fulfil its requirement to represent all audiences by reaching out to underserved audiences while also making significant changes to its operations in the UK’s nations and regions".

READ MORE: After Nicola Sturgeon complaints BBC's Andrew Marr faces third tranche of 'bias' allegations

The BBC has been concerned that a licence fee freeze meant that £800 million had to be found over the first five years of its present charter period which took effect in January, 2017. A further £125 million of savings were being targeted after falls in licence fee collection and commercial income due to the coronavirus pandemic.

According to BBC documents in March 2020 the BBC paused its plans for significant operational changes to its News and Nations and Regions divisions to deliver the £800m savings, to ensure that it continued to provide national and local news coverage during lockdown.

The size of the BBC’s workforce has consequently not reduced because it delayed more than once planned changes to its News and Nations & Regions divisions, the NAO.

The delays to these changes meant delays to savings and consequently higher costs in 2020-21 than budgeted.

The NAO says there has been 450,000 fall in the number of non-over-75 households buying TV licences – due to changes in audience viewing habits.

The BBC’s licence fee income consequently fell by £310 million between 2017-18 and 2019-20, to £3.52 billion.

And the NAO warned a falling audience share poses a "financial risk as people are less likely to pay the licence fee if they do not view licensable content".

READ MORE: After Nicola Sturgeon complaints BBC's Andrew Marr cleared again over bias

The BBC was urged to produce a long-term financial plan to set out the next stage of its savings programme, and how it will fund its new priorities.

""hile the BBC “considers that it delivers significant wider value to British and global society… it has not conducted an economic analysis of this in almost 10 years", the audit body said.

Gareth Davies, the head of the NAO, said: “The BBC faces significant financial challenges as it embarks upon licence fee negotiations and its mid-term charter review.

“It has made significant cost savings and has identified the need for more with licence fee income under pressure.

“As decisions about the licence fee are made, the BBC needs to develop a clear financial plan for the future, setting out where it will invest and how it will continue to make savings.

“Without such a plan, it will be difficult for the BBC to effectively implement its new strategic priorities.”

After an outcry, the BBC decided in the summer of last year not to continue with free TV licences for over-75s.

The broadcaster was set to take on the financial burden of providing free licences for over-75s from the Government in 2020.

The broadcaster said that if it bore the full financial burden of the free licences, the extra cost would have meant “unprecedented closures”.

This would have included the closures of the BBC Scotland channel as well as BBC Two, BBC Four, the BBC News Channel, Radio 5live and a number of local radio stations, as well as other cuts and reductions , it said.

The NAO said that “while the BBC remains the most used media brand in the UK, its share of younger audiences has been under pressure”, it said.

Its “principal source of income, the licence fee, has also declined, and the BBC now faces considerable uncertainty about the income it will receive from the licence fee”.

In 2019-20, the BBC generated total income of £4.943 billion, of which £3.52 billion was public funding from the TV licence fee.

BBC radio audience time has also declined, falling by 15% between 2013-14 and 2019-20, when national commercial radio stations have maintained or increased their audience time.

Paul Siegert, the NUJ’s national broadcasting organiser, said: “The findings by the National Audit Office come as no surprise. The NUJ has been warning for sometime that the BBC’s financial future is uncertain. There have been too many dodgy, behind closed door deals done in the past by successive BBC director generals with the government. Now is the time to have a grown-up discussion to ensure that the BBC is properly funded and funded in a way that comes without any political interference.

“It is unacceptable that the BBC should have been forced to take on the funding of free licence fees for the over-75s. The cost of that is now £500m annually. They have only been able to meet that obligation by cutting costs when that money should have been invested in quality programming and journalism. On top of that, is the threat of the government decriminalising licence fee evasion.

“The BBC has played a vital role during the current pandemic but as the BBC begins talks with the government over the next licence fee settlement it needs to ensure a financially secure long-term deal that will guarantee its future.”

A BBC spokeswoman said: “As the NAO has set out, we have made significant savings and increased efficiencies, while maintaining our spending on content, and continuing to be the UK’s most-used media organisation.

“We have set out plans for urgent reforms focused on providing great value for all audiences and we will set out further detail on this in the coming months.

“The report also stresses the importance of stable funding for the future, which we welcome as we begin negotiations with Government over the licence fee.”