MPs demand BBC rethink radio cuts as they urge more support for local news in UK

The BBC should halt its scaling back of local radio in its pursuit of digital growth in local news, an influential panel of MPs urged today.

The call, the first formal rebuke of the BBC’s plans, is one of a number of recommendations made by the Department for Culture, Media and Sport Select Committee in its review of the sustainability of local news.

It also suggests:

• The fast implementation of the Digital Markets Unit to redress the unbalanced relationship between large digital platforms and local new publishers, ensuring all publishers are fairly rewarded as a result.
• The Local Democracy Reporter Scheme, which funds 165 journalists to cover local councils around the UK, be protected in future BBC Charter Reviews and expanded in scope too
• The creation of a long-term public interest news fund to support innovation in local news
• Statutory notices continue to be advertised in local media, but rules around where they can be placed be reviewed, with guidance for councils on how to measure levels of audience seeing such notices. The Government is also asked to review how a wider range of local media could potentially access public notices revenue
• A review of the public money which supports the local news sector, and whether it is fairly distributed at the moment.
• A review of how local news organisations could attain charitable status in a way which does not compromise their ability to campaign or hold power to account
• The Government explore how community radio could be supported to conduct more journalism.

Damian Green MP, Acting Chair of the DCMS Committee, said: “With the shift towards online readership swallowing up traditional print revenues, many local newspapers which have served their communities for years have struggled to keep their heads above water.

“While hundreds have already folded, those that remain are faced with a lack of resources to conduct quality journalism, forcing them into a downward spiral of decline, as readership and therefore revenues continue to fall further.

“The disappearance of local news providers, which have always acted as the eyes and ears of their readers and held local decision makers to account, has ripped a hole in the heart of many communities. Worryingly it is the most deprived areas of the country that are most likely to miss out on coverage, compounding the disadvantages they already face.

“While there are many success stories of innovation, the very nature of having smaller audiences and limited reach means local publishers find it hard to float in a market that rewards scale. The sector can have a sustainable future, but without more support and a rebalancing of the rules to help smaller publishers, the decline in local journalism and all the negative impacts associated with it will continue.”

What next for the BBC’s plans?

The DCMS select committee’s work began long before the BBC announced its controversial plans to scale back on local radio to divert spending into local online news instead.

However, after a final session of the committee late last year, at which senior BBC leaders were grilled by MPs, their call for the BBC to rethink its plans is the first formal rebuke from an oversight organisation, and comes just weeks after Ofcom gave the plans the green light.

Under the plans, the BBC’s local radio stations would only have local shows between 6am and 2pm every day, before regionalised programming shared amongst groups of stations covering similar areas to regional TV news, take over.

The BBC has argued the move means it can still ‘super serve’ 70% of its audience, while creating a local digital news service more people will want to use.

But MPs in the House of Commons have condemned the moves, while staff across the BBC’s regions have opposed the plans. Local publishers have also said the BBC’s moves would be damaging for their futures too.

In its report, the DCMS committee said: “Near the end of our inquiry, the BBC announced proposals for its local radio stations to share more content as part of its wider Digital First strategy.

“We are concerned that this will diminish the unique localness of the BBC’s current services and urge the Corporation to reconsider the plans.”

The BBC has not responded to the call.

Concerns about publishing quality

Among the evidence submitted to the committee, there was plenty of criticism for mainstream publishers such as Reach and Newsquest, although much of the evidence put forward has subsequently been challenged by those organisations.

The report stated: “With falling revenues, local news publishers are left with fewer resources to conduct effective journalism, and the quality of the stories they publish and their relevance to local communities can decline.

“The economics of digital advertising may contribute to this trend, as sensationalised news content designed to drive visits to a publisher’s website is incentivised to increase revenue.

“In response to the declining quality of their local paper, many people choose to stop buying it and often also no longer visit the publisher’s website. The publisher’s revenues fall further, and the downward spiral continues, often until the publisher is forced to close or merge with another.”

It is that train of thought which has led the committee to focus on possible sources of support for smaller publishers, or new entrants. It also questioned whether so many local democracy reporters should be employed by the largest publishers.

But the committee also noted: “The largest multi-title publishers denied arguments that they are compromising journalistic quality for the sake of higher profits.

“Newsquest said that their titles are typically read by more than 75% of adults in their respective local communities each month and this demonstrates customer loyalty and satisfaction with the journalism produced.

“Reach told us they were employing more journalists than before the Pandemic and working from home arrangements had allowed their journalists to become more embedded in their communities.

“They said that in addition to 15 regional hubs, they have multiple smaller bases for their titles and there is no link between the hubs and how stories appear in their publications.

“Reach also argued that government and funders tend to wrongly assume that large multi-title publishers lack innovation, and funding schemes can be biased towards new, independent publishers.”

Henry Faure Walker, chief executive of Newsquest, said: “Our understanding is that smaller publishers get disproportionately more per title than larger publishers — and to be clear, we have no issues with that. We’re also very proud of the quality of our local journalism Newsquest reporters produce, quality which underpins our successful digital subscriptions strategy.

“In our view, the best way the Government can support local news publishing in the UK is through much greater advertising support, which should be a win-win: Local news brands reach almost 75% of the population each month, but last year received less than 3% of Government advertising.”

Maria Breslin, editor of the Liverpool Echo, who gave evidence to the inquiry said: “I was very proud to speak on behalf of the Liverpool Echo to provide evidence for the DCMS inquiry into local journalism and while I agree with many conclusions in this report, I am disappointed that its writers chose to stick with a lazy and perhaps even harmful judgement about the quality of local news.

“The Echo continues to sit at the heart of our community, read by almost half of all adults in Liverpool every month, and to tell the stories that our readers both want and need — whether that’s leading the way with coverage on the tragic shooting of Olivia Pratt-Korbel, embracing Lunar New Year and celebrating with Liverpool’s Chinese community or going behind the scenes on the Coronation Street set.”

David Higgerson, chief digital publisher at Reach, added: “We are concerned about the unfounded comments on the quality of local journalism and a somewhat puritan view of public interest journalism. Journalism can only be a force for good if people actually engage with it.

“At Reach, we are proud to employ over 1000 local journalists all around the country, who care passionately about their areas. And while the digital age has changed the industry forever, in many ways our journalists’ job remains the same — to engage people with a mix of stories, some serious, some light-hearted, but all relevant and interesting to the local audience. Our data tells us that in fact we have become better at this than ever, with more of our audience reading public interest stories, as well as many pieces on other topics.

“It is essential the Government keeps supporting local news publishers such as Reach’s local titles, who between them reach over 40m in print and online.”

So how should local news be funded?

Amid much debate over the revenues within local media, Owen Meredith, chief executive of the News Media Association, perhaps summed the challenge up most succinctly.

The report noted: “Owen Meredith told us that for publishers a print reader is worth about eight times a digital reader.”

So where does future funding come from? The focus of the committee’s recommendations has been on ensuring that as many local publishers as possible have access to more funding streams.

The report also seems to be less convinced about subscriptions than Dame Cairncross was in her review of local media several years ago.

The report noted: “Adam Cantwell-Corn, co-founder of The Bristol Cable, noted that even though the paper is often viewed as a frontrunner within the sector in terms of innovation, quality, and turnover, it is “extremely vulnerable.”

Research from the Public Interest News Foundation was also quoted:

Our research found that some audiences would be willing to pay an average of £1.30 per month for quality independent local news. On this basis, it would take 1,000 paying subscribers to generate annual revenue of £15,600. Let’s say that a sustainable operation requires a minimal staff team of six: an editor; two reporters; a salesperson; and an administrator. According to the latest ONS data, average salaries in the UK are roughly £31,000. So, in order to build a small team of six people on average salaries, plus employers’ contributions and overheads, a news publication would require a budget in the region of £250,000. In order to generate annual subscriptions revenue of £250,000, a publication covering a typical local authority district would need to convert almost 10% of the population into paying subscribers (and a much higher proportion in smaller areas). This is an ambitious target, even for the most successful independent local publications.

PINF also warned that pursuing charitable status wasn’t seen as an option for many publishers it had spoken to as it could limit freedom of expression.

The committee noted: “Charities are constrained in various ways in terms of their political and campaigning activity. They cannot exist for a political purpose, and in the political arena they must stress their independence and not give support to a political party, nor to a candidate or politician.

“ In addition, and as the Cairncross Review noted, charitable status would not benefit many other publishers as they are commercial endeavours. Some of those who wrote to us recommended, instead, that the Government develop an alternative form of tax relief that would have some of the benefits of charitable status, such as being able to claim Gift Aid on donations.”

The committee has called for a review of who how public notices funding is spent, how government cash more widely is allocated to local news, and for the new Digital Markets Unit to make sure all publishers benefit from a fairer playing field with digital platforms like Facebook.

NMA chief executive Owen said: “We strongly welcome the Committee’s recommendation for government to lay out “clear and explicit provisions” for smaller local publishers to be renumerated fairly under the pro-competition regime in the Digital Markets, Competition and Consumer Bill.

“This legislation will be imperative to the sustainability of local journalism in this country, helping to support competition in our digital economy and levelling the playing field between news publishers and tech platforms.

“We were pleased to see support for retaining statutory notices in print local newspapers, which remains a vital source of revenue for local publishers and is a cornerstone of local democracy, enhancing open government and debate in our communities.

“We also share the Committee’s concerns over the BBC’s plans to expand their online local news services, which as the report notes, would only threaten commercial local news publishers who are already facing challenges to building a sustainable business model for digital news. We strongly echo the report’s recommendation that the BBC reconsiders their plans.”

David Higgerson at Reach added: “We welcome the committee’s support for providing a fairer model between platforms and publishers through the Digital Markets Unit, which is critical to the development of a vibrant local publishing sector in the future. This is the most pressing issue facing our industry, for both large and small publishers.”

Government ministers will update the committee at a future date on what it thinks about the recommendations.