Welcome to the Public Accounts Committee on Thursday 8 January. I extend a special welcome to the right honourable Sir John Whittingdale, who is guesting from the Foreign Affairs Committee, and the right honourable Damian Hinds, who is guesting from the Culture, Media and Sport Committee. The BBC World Service provides crucial services for impartial and independent news programming globally, bringing in a weekly audience of over 300 million across 43 languages. The World Service is funded by a combination of the BBC licence fee and grant funding from the Foreign, Commonwealth and Development Office. It has a budget of £358 million in 2025-26. Since 2022, the BBC World Service has made savings of around £50 million, following reductions to the BBC’s licence fee income. These have been made mainly through closures of TV and radio platforms. Inevitably, audience numbers have fallen over this period: they are now about 14%, or 52 million, less than in 2021-22. Today’s session will be an opportunity to challenge the BBC on its approach to planning the World Service savings programme, as well as plans to make improvements for the future. We will also be examining plans for how the BBC will sustain public trust in its services. We are very pleased to have a senior team from the BBC with us today. Tim Davie, the director general, is well known to everybody. Tim, would you like to introduce yourself and your colleagues, please?

It is a real pleasure to be here. I welcome your opening remarks, and we look forward to the discussion. I always prefer my colleagues to introduce themselves, because I think it is worth your hearing from them. Jonathan, do you want to introduce yourself?

Good morning, everybody. Thank you for hosting us. I am Jonathan Munro, the interim CEO of BBC News. Substantively, I am the global director of BBC News, but as you may know, we have had some management changes recently, so I am covering the CEO’s role and Fiona is covering my role. I will let you introduce yourself, Fiona.

Yes, introduce yourself, Fiona. A warm welcome to you.

Good morning, everyone. It is a pleasure to be here. My name is Fiona Crack. I am the interim global director, who has responsibility for the World Service; I am filling in for Jonathan while he does his role.

We extend a special warm welcome to Fiona and Jonathan because this is your first time, I think, before the Committee. To start off our questions, we will go straight to Rupert Lowe.

Good morning, everybody. To start with, I should probably declare a conflict of interest, in that I have had three complaints upheld against the BBC in the last 12 months. In case anyone thinks that makes me biased, I probably ought to disclose that. My question is for Tim. Have you actually all read the NAO Report in full, and do you agree with it?

Absolutely. I have read it in full, working with the NAO, and I thank the NAO for the Report. Over the last few years, we have worked very hard to get our operational delivery and grip to a different level, and the NAO is helpful. I certainly don’t think we are sitting here, if I may say so, trying to be in rebuttal mode in the slightest. I have read all the Report fully. Obviously I have some support here, in terms of some of the detail, if we get to the real grip of the individual savings plans and where we are at. We fully agree with the analysis. There are bits where we would say, “Okay, there are some learnings there; we might have a gentle push-back in terms of how the process worked,” but overall we agree with it. I think, if you step back from it, what it says at a top-line, CEO level—the first thing I would say is that we should talk about it, and I am sure we will, in terms of the tough envelope for the finances of the World Service. I happen to think that we are at a very, very important point in the UK in making decisions or investing in services such as the World Service—soft power and opposition in the world. We can talk about that, but what this says is that under very, very tight financial constraints, we made some tough decisions. The BBC has a strong record and grip. It has some good people who know how to deliver savings plans. You will see that we are slightly behind, but we will deliver those £54 million of savings as part of, if I may say so, £700 million of savings across the BBC that are well tracked. What the NAO does is this, and I think it is right. It is pretty tough on us, rightly, in terms of some of the documentation in the process by which you analyse some of those decisions. As you would recognise in business, you have those discussions. Sometimes we can do a better job, a bit—bluntly and being very open about it—in terms of some of the documentation, but on the overall results of what we did, I think we made good decisions under extremely tough circumstances. I think we will get under the numbers in terms of some of the declines, which also relate to other factors such as Facebook algorithms. They are not just about the so-called cuts; they are about how the world is moving. But overall, I have read the Report and am supportive of the NAO’s conclusions.

We see in the Report: “However, these business cases did not meet NAO‑identified good practice. They lacked options analysis, had poorly developed risk assessments and in some places contained inaccuracies… The Service’s monitoring of its savings progress was hampered by the complexity of its finance system. It therefore relied on estimates instead of actual information… In addition, the BBC’s Whistleblowing team identified issues with poor-quality documentation and analysis to support key decisions in phase one of the Service’s savings programmes.” In a private business, if you read a report like that, you would think, “We’re flying blind.” How can you be confident that you made the right decisions when the quality of the data that you appear to have based those decisions on is arguably deficient?

If I may say so, having worked in the private sector for more than a decade, I think what it says is not quite flying blind—far from it. What it says is that the documentation and the way some of the decisions were made did not meet the NAO’s best practice. That is slightly different.

But you have to accept that some of this is quite critical.

I do. It is the level of criticism, how we react to it and how we improve that I am reacting to, and how we describe the scale of the issue. I am not being defensive about it; I am just trying to present a fair picture. I agree with the analysis, but I do not believe we were flying blind. The BBC is never short of paperwork.

Too much paperwork can be confusing, can’t it?

Correct. One of the things I have done over my tenure is reduce the amount of paper flying around the BBC. The issue is the actual standard, formats, risk registers and what format you want. What the NAO and the team have done, quite rightly, is say, “We have best practice in certain areas.” It is not as if we did not look at risk. Of course the team were looking at options. They are concerned, like everyone around this Committee if you are trying to find money, about where you do it with the least impact. They were looking at particular audience metrics. I will give you some specifics. They were looking at audience metrics and very carefully at options. Could we have recorded that more carefully? Could the quality of documentation have been better? Yes, agreed. We have some learnings. The BBC, for all its dramas literal and metaphorical, has a very good record over the last five years of delivering on plan to the numbers it commits to in its savings plans. It has a level of operational rigour and efficiency that I am proud of—very proud of, actually. If you came to the BBC and met the people, the project management, you would see that they know their business. As CEO, I look at it overall and say that we are delivering on this savings plan, although it is slightly late. In a commercial operation, that would be your prime concern alongside your overall metrics.

I am not sure that it is necessarily the prime concern, Tim. The key is that you can deliver the savings, but the question that I think the NAO is asking, and it is a valid question, is what the downstream effects of those cuts are. It does not appear that you necessarily have the management tools to be able to make that call. I think that that is what they are saying. Making the cuts is always easy. The question is: what damage is making the cuts doing?

I think that that is a fair observation. The truth is that we have had some considered thinking about sensibly making those decisions. But what the NAO brings, helpfully—I am the first to say this, because you know as well as I do that you can always improve—is to say, significantly, “Are we completely clear about the forecasting and the risks involved?” The last point that I would make before handing over to the team is that we are in an incredibly difficult world to forecast. Maybe it is because I am towards the end of my tenure and I am slightly more untethered, but I think you can do all the forecasting—

Just because you are in a difficult world, that does not mean that you do not try to forecast.

No, of course.

On that basis, nobody would bother with a budget.

I am not lurching to that position. I am saying that when you have had years of inflation popping to 30% in markets and the number of conflicts that we have had to deal with, that is quite difficult. To your point, I agree with you. The NAO are saying to us, “Look, you could make a better job of some of that risk assessment.” I agree with you that there are things we could do.

There is a question that follows on from that, Tim. It does not sound as if you have fully taken on board what the NAO said.

Sorry, can I ask you why you do not sense that?

The question for Jonathan is “What are you now doing to change as a result of this Report, if you accept this Report as valid and having veracity?”

Which we do, of course; I echo everything Tim said about that. Thank you for picking up on the question. To build on Tim’s point and then come to your point about what we are doing now in terms of our processes, in the period relevant to the NAO Report, which is 2022 onwards for three financial years, we took about 14% of our costs out, plus the effect of inflation. That is a considerable chunk of our money. We are delivering all those savings by about two months from now—at the turn of the financial year coming up, we will have delivered them all—so there is a time lag compared with what we hoped to do, but the savings will all come. That time lag was caused by a number of things. There are clearly lessons in the paperwork process and benchmarking, which are identified in the NAO Report, as you rightly say. We agree with all the points that the team have made, but there are other factors that are slightly less dry and are important to bring into the room. As Tim mentioned, we talk a lot about costs relative to previous budgets. We often talk about real-terms rises or cash-flow rises. We are talking then about the relative settlement for UK inflation purposes, but UK inflation is a pretty minor factor in World Service forecasting. We do forecast for those things, but we had a global inflation peak, which in three of our key markets pushed inflation up: in Lebanon, where we had a significant base in the period relevant to the NAO Report, to 45%; to 38% in Egypt; and to 30% in Nigeria. Very few businesses have got enough elasticity, particularly when spending and accountable for public money, to forecast for that inflationary surge. Inevitably, we had to move some money around in the three-year period in order to ensure that we were not taking money out of the frontline of coverage. Secondly, the beginning of this period coincided almost bang on with the invasion of Ukraine by Russia. That was a massive story. Stories are what we do, and it is reasonable to say, “Well, surely you forecast for news stories.” We do that, but when the news story results in having to lift and shift the whole Russian language service from Moscow to Riga for their own safety and their own legality, that is a very significant cost. It also makes it almost impossible, at the same time, to deliver a structural saving against a preordained timeline, because it might be the right thing to do but the wrong time to do it. Those factors mean that the elasticity of our budget planning has to be a little more fluid than in a less volatile business, perhaps. The third factor—this is also important to your point about future-proofing the system—is that all three years were subject to one-year by one-year funding settlements from the Foreign Office. That is no way to run a long-term business strategy. We are sitting here on 8 January and we still do not have our budget settlement for the new financial year from April, which is less than three months away. Getting budget planning in time relies on a number of things to be true that are out of our control. Luckily, we think we are moving to a place with the FCDO—with whom we have an excellent relationship, by the way—where we will have a longer-term budget settlement. We would really welcome that: it would make it a lot easier to deliver against forecasts. On the point you asked specifically about changes to processes now, Mr Lowe, we have had access to some of the NAO’s findings for quite a considerable number of weeks. We have read them all and digested them all. We are now working to change some of the specific points that the NAO identifies in its Report—for example, on business planning, paperwork, templates and those sorts of things, the backroom functions that enable us to report more accurately—but we will always be vulnerable to the news agenda and to unexpected events.

Thank you for that. I have a question on the complexity of your finance system. I am finding it difficult to understand why it is so complex. I would like to know why. After all, your actual business model is not that complicated. You send out 72 million letters a year to collect the licence fee from those people who have not paid. Very often, old people are being chased, with quite aggressive letters. It does not seem to me that accounting for a monopoly should be that difficult, because your income side of the equation is quite straightforward. It is not like running a contracting business, where you have work in progress and all sorts of variables; your funding largely comes from the licence fee payer. I accept that for the World Service, some of it now comes from the FCDO, with a 31% increase last year, and it looks as though you will get more from the FCDO again this year, but that is still taxpayers’ money.

Of course.

That is not money that you have to go and earn; it is money that comes in. I accept that they have not agreed it yet—it is remiss of me not to have done that—but I am struggling to understand why your finance system is so complicated. A complicated and opaque finance system means that it is very difficult to make good decisions. Can you explain to me why it is so complicated?

I will make one point. Complicated is one thing, and opaque is another. Complicated is what we are talking about.

Complex systems mean opaque data.

They can—there is an opaque risk. Can I just make one point on the revenue? I totally agree with you. This is in some ways a simple business model, with regard to the licence fee.

I would have thought so, but—

No, no—I am agreeing with you. We don’t need to argue about that, although we may have some debates about the enforcement. That model, in and of itself, is simple. Remember, however, that if you look at the overall BBC revenue, we have a very successful £2 billion commercial arm, which I am very proud of, so we have that revenue coming into the system and the dividends from that. We have a high-functioning board, in terms of how much revenue we take from the commercial arm versus investment—classic stuff that you would be across. Then you have the World Service funding, so it is a bit of a stitch-together before we get to the complications, which you can address, in terms of day-to-day management of financing across currencies, business models and freelancers. There is this idea that that is not complex in itself, but I have run commercial organisations, and there is a degree of complexity there. It is not as simple as getting the licence fee in and spending it, when it comes to international and global operations. I get your point, by the way, and it is a fair one. It is one of the things that has enabled us to go after savings so clearly. One thing we are blessed with is that we have some degree of certainty over revenue. The simple nature of the licence fee allows you to plan for the long term and do the right things for the UK. Jonathan might want to give a flavour of the day-to-day operations, across multiple currencies with different business models, with the commercial revenues coming in. It is not quite as clean as you are talking about, in terms of the challenge for the finance teams.

I would love a simpler finance system, to be clear. By way of disclaimer, I should say that none of us here is an accountant by trade. Clarity of accounting is very welcome. In truth, it is quite complicated in the World Service. You rightly suggest that the licence fee accounts for roughly two thirds of World Service budgets right now. It was more than that, but the Government, as you say, increased what was called the grant-in-aid allowance in the last financial year. As you have just discussed, we are awaiting the next settlement. There are other, relatively minor income streams, but they are not irrelevant to your complexity point. A lot of our broadcast products are carried by partner broadcasters around the world. For example, we have just done a new deal in Pakistan for Urdu-language carriage. Each of those is an individually negotiated contract, as you would expect—there is no template or blanket contract—and they have different financial metrics around them. For the avoidance of doubt, we do not pay those carriage partners to get on the air. Rival international broadcasters do that; we do not. We don’t think that that is an appropriate use of public money. Each of them has a different ebb and flow about the commercial revenue that attaches to those contracts. Then there is a small income—and it is small—from the commercial return on the World News channel, where there are commercial breaks that are shown outside the UK, so it is not quite as simple as just licence fee and FCDO, although those two are easily the biggest of those shares.

Okay.

One other point that I would make is that we are a 100-year-old organisation that has had offices around the world. We do need further investment, in terms of our finance systems. It is not that I think we have a big issue, as such, but in terms of efficiency—this goes to your point about seeing things quickly and clearly—could we do better? Of course we could. Obviously we have our annual accounts with the NAO, which is a very robust process that works well. Like in any organisation, it is verging on the normal to have us look in detail at where the exceptional items are. One of the things coming through that is that we have too many people. Our record is good, by the way. We are not sitting on anything. I am not saying, “We don’t know what’s going on in that area,” or, “We have found things that we are uncomfortable with.” We have actually dealt with it really well. We have a good grip on the finances. That is different from complication or being able to see things quickly and make the right decisions well. There are some opportunities. There is not a company in the world that this does not apply to. I am sure that if you take the civil service or any other organisation, there are common issues. A lot of our finances sit on manual spreadsheets that then get inputted into the system. We rely a lot on people locally pulling stuff together and then putting it into the system. There is all that kind of work to be done, and we are in the midst of that work. It is a classic—it is how much money you want to spend at that point, in terms of your capital, versus day-to-day delivery to audiences so that someone gets good value for their licence fee. We are not in a bad state. We are delivering our accounts and numbers.

Could I take a step back, Tim? You have repeatedly drawn attention to the fact that the BBC’s overall income has suffered a real-terms decline over the last five years or more. You have set out the necessity of achieving substantial savings. How did you decide the proportion of those savings that the World Service should be required to meet?

That is an extremely good question. The broad principles were the following. The first thing we had to do was ensure that from an overall BBC standpoint, we maintained usage and relevance in the UK, because, to the earlier question, it is about making that licence fee income work. We may talk about this later: we want to reform the licence fee, but the one thing the licence fee is dependent on is people’s usage. You know my views on this: every week we get 80% of people using the BBC, and in a month nearly everyone in the UK uses the BBC. We were very focused on “What are the things that do two things: deliver those numbers, but also do so in a way that is in line with our purposes?” You could deliver that by making more and more entertainment shows. That is not what we want to do. One of the joys of my job is that balance between the Gaelic service—the wonders and importance of that—versus more “Traitors”, all of that. We went through a very detailed analysis of return on investment to ensure that the UK public were getting value. That was principle one. With regard to the World Service, we then said, “Okay, once we’ve done that, we also need to protect the World Service as well.” You could make arguments—if you took what I have said purely in relation to the World Service, and we have talked about this—that it could be cut even further, because you could say that for a household in Plymouth or Penrith these services are less relevant to them than English services. But we felt, strategically, that one of the most important things for the BBC—and this is the balance—was the World Service, so you don’t deploy what I have just said so fully that you strip the World Service, because you could take that argument. I think that would be totally the wrong thing for the UK. To answer your question, we decided that we wanted to protect the World Service investment broadly in cash terms—you can see the analysis, which shows inflation going down. We wanted to keep it in cash terms in line with the rest of the BBC; to keep its cuts and pressures not particularly worse than the rest of the BBC; not to discriminate against the World Service; and to do all we could to ensure we were making the right decisions to keep the audience numbers to a point while doing that. You know my view on this, which is that I think the UK should be spending double the amount it spends on this service, without question. If you look at what China and Russia are doing—£6 billion to £8 billion—I think it is absolutely paramount that we invest in what I think is a unique and precious UK strategic asset. I care about that enormously, and I think it needs investment. In terms of the licence fee construct and how much you ask from it—I mean, I am going around the country all the time—household budgets are under enormous pressure. For us to ask for more for the World Service from the licence fee, I think, is untenable. For me to announce, “I’m sorry: you won’t be getting Radio 4, or all the other things we do, but we will be ploughing money into the World Service”—that is not something we could do. The short answer to your question is this: keep the cash where it was and do not diminish the World Service, even though you could argue that it is a poor return on investment in regard to the UK licence fee payer—you might want to do that; I did not want to do that—and do not cut the World Service more than the rest of the news and all the other things, because we were facing a 30% real-terms decline in our income over the last decade. That is what we tried to do. It is not a perfect answer, because you can see what you wrestle with in my job: trying to get the right balance. I am proud of our team that we have maintained our reach of over 300 million, and, with the successful efforts of the commercial arm, over 400 million people are now getting BBC services every week. My personal view is that I would like to see 1 billion. I cannot, for the life of me, see why we do not see this as a better investment as a nation. I really feel strongly about that. I cannot go further with the licence fee.

You lost 47 million audience in two years. Did you at any point sit down with the Foreign Office and say, “Is this the direction of travel that we should be going in?”

We have had a good partnership with the World Service. We have talked in detail with them over a number of years, and they are under enormous pressure, as you know, in terms of public take-up. This is a service where you pay and play: if you invest more, you get more services and you can get more audience. It is worth noting that we are in a world where suddenly, from fixed distribution of radio and television, we are now into something different. Traditional media organisations are facing some structural decline anyway, and we are in the hands of algorithms where if Facebook decides not to do news, you are going to lose some audience. It is a mixed picture, as opposed to just general decline; there are different bits of pressure in different markets. Jonathan, do you want to talk specifically about that? It is quite a nuanced discussion about where you invest. It is not just about audience; it is about strategic interest as well.

Precisely. Following on from the Chair’s question, surely the value of a million listeners in the western Balkans is considerably greater than that of a million listeners in a European Union country, for instance.

I totally agree.

When you decided which services you were going to close, how much was that in discussion with the Foreign Office about the strategic priorities of the UK?

Fiona can run you through the criteria we use for that.

It is a very important question.

When we are looking—and indeed when we looked at the first savings—we are always looking across the portfolio of what the World Service is, what it offers and its performance. In terms of the offer, for each market, we look at, “Are we on linear and are we on digital? What is the reach and market share of that, and what is valued? Are people coming directly to the BBC’s services, or are they getting it through a third party?” We also look at the market itself. All markets around the world are turning towards digital—but at different rates. We therefore ask what the digital maturity of that market is, where people are going for their news, where we need to be and what the readiness is for that. That is because we are always looking at value for money. We ask where we might make savings on linear if audiences are declining there, to ready ourselves for where they will be—which is digital. The other very important part of those three things that we are thinking about is audience need. We look at indicators around fragility, we look at where there is conflict and we look at where media is repressed. In 75% of those places, media freedom is either low or totally restricted. A large percentage of our audience are in those markets, and that is a very important part of what we do. We also look at the demographics: where are we reaching women and where do we need to do more around young people? Those are the three key criteria. We look across where we already are and where we need to retain our linear. In some places, such as Afghanistan and parts of French-speaking Africa, they need, and we require to give them, radio and continue that. What you see in the first savings is more services becoming digital only. Where we have seen the digital maturity of that market, and could become digital only, we moved to it. We also looked to move people and services closer to the region, partly because of the value-for-money consideration we were under. For example, we moved Bangla and Korean. That is how you see the picture building—the options of what we could do. Audiences of need is such a crucial part of what we do, and we want to be there where audiences need us most. In these three savings, we have got the portfolio—the 43 languages that Tim spoke about—and we have also started emergency services. In Sudan, we started a weekly radio programme. In Gaza, we started a weekly radio programme. We started “Dars” in Afghanistan, which is an education programme for girls. It uses Bitesize, which is the UK product, but we make it in Pashto and Dari. It was the only thing that girls in Afghanistan had for a year on television, radio and online. With these emergencies, the agility for us to respond to events in the world is part of what the World Service needs to do.

In your answer, you have repeatedly said that you look at media freedom and you look at where there is strategic need. Surely those are issues that should be determined by the Foreign Office?

They are absolutely in that discussion with the Foreign Office. I have had it directly—“These are the areas of strategic need and the UK’s interests in terms of where we need to be investing and where there is a democratic deficit.”

So when you decide to close, not all three elements of the language service, but let’s say radio and TV, and maintain digital, as I understand it, under the terms of the grant you are not required to seek approval from the Foreign Office, but would you, in those circumstances, still go and say, “We think we know what we need”?

Yes, of course we would discuss it.

We have quarterly meetings with the Foreign Office at officials level, an annual meeting with the Foreign Secretary and regular contact with the Minister of State who has responsibility for the World Service. We have a no-surprises policy in those meetings. I think that is important, and it becomes more important if we are asking the Foreign Office for more money from public funds—from taxpayers’ funds, to Mr Lowe’s point. That dialogue is positive and constructive. We would never—certainly not under my watch or Fiona’s watch—close any aspect of a service without the Foreign Office being aware that that was our proposal and being open to a discussion about the implications. But that does not mean that we can avoid closures altogether, of course; it means that we calibrate with them the strategic priorities and all the criteria that we have discussed. Could I make one clarification point about audiences, because it has come up twice in the conversation so far? Chair, I think you started with a figure that we had lost audience since 2021-22, and you are right, but every global media organisation at that time had a bump in audiences because of covid and global lockdown. If you look at the figures going back to pre-covid in 2016-17, nine years ago, the World Service was pulling in 210 million a week. We are now pulling in 313 million, so over the decade it has gone up by nearly 50%. It is important that the covid years are not taken as a benchmark for, as it were, normal periods of activity, because that is not a reasonable benchmark.

The other benchmark that I would look to is how efficient we are at delivering our audience in terms of price per viewer and listener versus the competition from other state actors. It is incredibly efficient. I would look at those benchmarks—they are really compelling. We cannot get the exact costs for the Chinese, Russian and Turkish operations at the moment, but we should be very proud that the service is delivering those numbers. The answer to your question is: absolutely, we are having those discussions with FCDO on the strategic interests. This team is not just simply about getting the audience number as high as possible—it is just not. It absolutely has the strategic interests and where we need to be in play as well.

When you finally get an outcome from the Foreign Office on next year’s funding—probably all of us sympathise that you have been unable to obtain that yet; I pressed the Minister two days ago and he said he was still not in that position—you would expect it to not just be a sum of money, but include clear indicators of where the need is for it to be spent. That might potentially be to increase services in parts of the world where the competition you referred to is strong.

Yes. In previous years, we have had some conditionality around funding settlements—that is perfectly reasonable. They are largely around protecting existing services from complete closure. As you know, it is a Foreign Office permission issue to close a language service in its entirety. It also holds the permission for launching new services. We have just launched BBC Polish because of the eastern European point you made earlier, Sir John, which is a success story in its short life so far. We are awaiting permission to launch two other eastern European language services for precisely that strategic reason. We would like to accelerate that, because it is the right thing for the audiences, it is the more efficient business model and, most importantly, because the Russian misinformation space is very important. In terms of other conditions, I think the relationship with the Foreign Office is very mature, sensible and pragmatic, and we would expect conversations about those. We all agree on a point that I think the MI6 chief spoke about recently in relation to the world order. The last few days have shown what a volatile place the outside world can be. She spoke about peace and war. In her assessment, the world is in the space between peace and war. That space is where disinformation and misinformation thrive. I hope that when we get to the Foreign Office settlement, any conditions that are attached allow us to really go for putting truth into that space in more parts of the world as efficiently as we can. I think that that is what the Foreign Office wants as well, so we are pushing at the same objective.

It is a jointly agreed plan in that way. We are in charge; within the agreement that we have, we can do things. It is the public investment, so it is us investing together. Regardless of almost all the ins and outs of it, we talk together about what we need to do with this to have maximum impact for the UK and our audiences, and for the world. It is much more than just a return on investment on a numbers basis. That is why it is different from the commercial world. We have talked about some of the things in Ukraine or Russia. I was very blessed to sit with the President of Ukraine, who said to me directly, “Thank goodness for these services.” But we have had to relocate people out of Russia, and our Persian service at the moment is reporting on the interesting and important events in Iran. This is investment that I think is really critical. We could not be more grateful for the £30 million-plus increase in investment that we got. We are asking for an investment of a similar order in terms of uptick next year, but it does not bring you a transformational change. If you look at where global inflation is, and if you look at competition and the need to be on digital platforms on the same money, versus operating just radio services, this is a real demand on our finances. We are doing what we can to get new digital services up and running, or other services that we need, but this is not transformational investment. It is sustained investment, at best, if we get a settlement. To ice the cake on the point about lead times, I am highly sympathetic to the pressures that the FCDO are under. We have enormous faith in their ability to support the World Service and work with us. Having said that, any business that has not got the planning—we do not even know what our numbers are for April. To the earlier point about planning and forecasting, that makes it difficult for the team. It is not impossible, because you can manage the risks and manage the scenarios. It does not mean that you are going to overspend or anything like that, but the quality of decision making is affected by your lead time. That is just life.

You have just said that you are expecting a similar uptick in investment.

We have asked for it.

Okay, you have asked for it. We are speculating here, but you must be doing planning now.

Of course we are.

If you get that level of investment from the FCDO, what will you do differently from what you are doing now?

Jonathan has mentioned some of the investment that we have put into Polska, which is different in several ways. For the first time, it harnesses AI as a translation tool, so we are able to do quite a slim-line service where we can take the excellent existing BBC content from across the European region, and beyond, and translate it—always having a journalist signing that off. It is a new way of working, and we believe that we can do that for other markets, such as Hungarian and Romanian hopefully, as well as beyond. The European security crisis is there, and disinformation is a particular worry in that region. That would be a way in which we could build on our countering of disinformation. We would also want to put more money not just into countering disinformation, by putting impartial news and information into those markets, but into the verification. I am sure that you know we will further invest in BBC Verify, as well as the disinformation team that we have in the World Service, which looks at how these things happen. What are the trends underneath that are pushing disinformation and misinformation in? That would be one particular area. I would also talk about circumvention. At the moment, a fifth of our language services have some kind of hostile interference. It might be jamming satellites for television, blocking on websites or taking down social accounts. Throttling is the other thing that happens, which is where a Government slows down the internet speed so that you cannot get on. All these different things are happening to a fifth of our services. We need to invest in circumvention to ensure that those people can get on to the BBC and can get trusted news from that. That might involve using VPNs within apps, so there are technological and technical things that we need to invest in to strengthen our circumvention. I turn again to audiences of greatest need, which is such an important part of the mission and purpose of the World Service. We want to do more on education, as I have mentioned, and more on learning, thinking about the audiences that we are not reaching, particularly women and young people, and how we organise ourselves to do that better. Those are some of the areas that we would be particularly looking at, with the regions that are affected most by mis and disinformation. Where we see the Chinese through CGTN, or the Russians through Russia Today and Sputnik, come into the markets, they are starting to absorb some trust from those audiences and put out a particular agenda for those news items. We have to think about that, and we would propose looking at that, along with the FCDO.

Thank you for that answer. There are bits in there that I think we need to come back to relating to technology and satellites, but let us leave that for now.

Can I just mention inflation, which is important? This is a finance Committee. Think about the level of investment we are talking about on a £300 million budget. We are paying people around the world, running those services and paying contractors. However brutal we are in our contract negotiations—and we are pretty flinty—we cannot avoid inflation. If you are simply saying, “You’re cash-flat for the year,” you are into cuts. That is part of the presentation to the Foreign Office: we are saying that, together as the public, if we want to maintain the service as it is—I do not want to sugarcoat this—while there are some really great things we can do, with the level of ask at the moment, a lot of that is simply keeping the show on the road in the inflationary environment that we sit in today.

Point very well made. John, had you finished?

I have one final point. One of the criticisms in the NAO analysis was that the rationale behind decisions on individual services and where you have cut back TV and radio services is not entirely clear and that there should be far more documentation and explanation as to how those decisions were reached.

We completely take that point. It is a very fair part of the NAO’s analysis. I think you have heard me say before, Sir John, that some of the specific decisions that were taken, particularly around Arabic radio, did not stand the test of time. I am not suggesting that different paperwork and benchmark reporting would necessarily have changed the decision, but it would have given us a paper trail back to how that decision was formed in more detail. I think that is a very fair point that the NAO has made.

We may wish to examine that in greater detail later on.

I will probably get the team to give me a little help as we go through this. It is about the timeframe rather than the savings themselves. Through the Report, we are at £46.8 million. We will deliver the £54.2 million. This is a timing issue, not a delivery issue. That is important. I am not dismissing the issues—I am seeing Mr Lowe giving me a look from earlier. That is absolutely right: there have been issues. I think we can actually give you some detail around those three factors. You can always come back to whether we could have forecast better, but certainly there have been some extreme times with regard to inflation and service stretch. Russia was one of a number of examples where we had to do extraordinary things to maintain our services. The final point, which I think is slightly harder to quantify, is this idea of the planning cycle and not knowing what your budget is. Shall we just do inflation first? Jonathan, do you want to answer on that?

I will start by taking the three years in sequence. By the way, it is three one-year savings plans; it was never one three-year plan, because of the short-term funding issue we talked about earlier. They happened to be sequential because the pressures of the issues I talked about earlier and the licence fee real-value decline were factors in all three of those years, but it was not one single plan. In the first year, the target was £28.5 million. I apologise in advance that there is a bit of data in this answer, but I think it is important for your question, Mr Turmaine. We met all those targets. There was a minor bit of overspill into the following year, but broadly speaking the scheme was fully implemented. Year two was the year when there was the cost of things like the Riga relocation for the Russian service, and we had started on the war in the middle east. There were, to use Tim’s phrase, service strains, and there were some ongoing costs of change, which were carry-overs from the previous year’s change programme—that was all in there. We moved £1.2 million of the savings into the Product Group; that is not World Service, it is part of the central BBC group structure that, for example, maintains things like iPlayer, Sounds and product development. So £2.8 million of the target was carried over into phase 3. Phase 3 is interesting because it is the one where we had the longest time lag. We met £8.4 million of the £11 million by December, and we will meet the rest by next March. But I am going to claim some responsibility here. I took the job as global director of BBC News in September 2024, having not previously been in the World Service. In truth, I came into the job and felt that we needed to make some structural changes to the way our services were managed. It is a different restructure from the one in 2022, which we can talk more about in a moment. My feeling was, although an awful lot had happened in 2022 that I supported and agreed with, it was principally a restructure driven by savings imperatives. There was an unintended consequence, which was that some of the lines of accountability for editorial output were too opaque—to borrow a phrase that we used earlier in connection with the financial situation. When I asked who was in charge of this particular bit of the World Service, should something go wrong, the answer was, “Well, it depends on what goes wrong.” To me, that is not the answer. The answer is, “It’s this human being.” That is not a blame game; it is just accountability. I felt that we needed to make some further changes—cost-neutral changes, by the way. I asked for a pause in some of the in-flight savings, so that we were not making in-flight savings in that year that, in truth, I was not supportive of. I did not find any of those; we carried through all the savings. But to pause briefly was the wise thing to do, so that when I brought up a new regional structure based on senior leaders around the world, rather than all being based in London—an important strategic move for the World Service—I was doing so knowing that the savings programme that we were coming to the end of in the last of the three years was still robust against that background.

It will be done by the turn of this financial year.

I can answer that. The nature of savings 1 and 2 are quite different. Savings 1 was about programme and platform closures, so it entailed significant staff reduction—up to 400 roles. Because of the complexity of the World Service, those 400 roles were in 33 different places. We were complying with an enormous number of different employment and legal frameworks, so we had to do that on a timeline that we were not necessarily in charge of. That gives a little bit of context to that. The nature of the second savings was much more around distribution. We renegotiated some contracts around shortwave and FM transmitters, for example. Some of them came to pass, and some of them we could get a better deal on. Those savings changed in nature through the year. Actually, because we are always trying to mitigate and avoid audience loss, but provide value for money, we were able to change the nature of that. The NAO Report refers to how we captured that. That is why it is a slightly higher figure that moved from savings 2 to savings 3, and it was realised within the savings 3 financial year—so, again, it was done shortly afterwards. I think that also helps to explain why our audience loss on savings 2 and 3 was far less than we had predicted. We had predicted that we would lose 11 million in savings 2 and 3.8 million in savings 3. Actually, we avoided most of those losses because we were able to change and find other ways to save money.

Yes. As you say, it is an area of concern in the Report. One of the elements to this is the pace at which it happened. At the time, a new director of the World Service came in at the end of ’21. The savings were identified around there—the amount that had to be found. Some of the planning that we talked about earlier in the Committee around the market analysis and the offer analysis and trying to see where we would best take those savings in order to protect audiences started to happen, within the BBC and with the FCDO. At that point, there was an optionality—an options look at what we might be able to do—and a savings case made. That was obviously pushed through the sign-off system. Figure 9 shows the governance support. At that point, the news board is the highest level of sign-off. Underneath that you have the steering group, which is led by the project sponsor, which was the director at the time. Under that is the programme board, which I was sitting on in the job that I was doing then. It was kind of what we were doing in Africa, in terms of the savings, and the workstreams flowed from that. As it says in the NAO Report, we did a RAID analysis and continued to do that throughout savings 1. The other thing to say, and I think this is an area that we have changed from the Report, is that at that point we did not have any dedicated project management support within the World Service. The director at the time knew that we needed it. It took several months to get that person in and to get started, so I think there is a fair criticism within the Report that that lag did not help in terms of the inputs, outputs and outcome tracking. We have changed that now. We now have a new role, a strategic planning and delivery senior role, so that as we have more changes that will inevitably come, we have that baked in and there will not be that delay.

Yes, I think we have identified most of those.

We touched on this earlier on. This Committee sits with a hat of representing the taxpayer and value for money. That is the reason we are here. As the NAO says, without clear ways of measuring non-financial impacts, how can you demonstrate the savings you are making? I accept you are making savings, Tim, but are they having a detrimental effect? You have talked a lot about how much you need money. I watch Elon Musk cut the overhead at X by 80%, and arguably it is a more efficient platform. I watch my own social media output, which absolutely astounds me—that so much has changed so quickly, as you say. I watch the British economy declining, and I hear you saying that we need all this soft power, which cannot have been helped by this Trump issue, as I will refer to it, which we do not want to get into too much detail on. Without the tools of actually judging what is going here, I am concerned that what we are seeing is a changing demographic. Young people do not trust the BBC, in my opinion—that is quite clear. They get their news and their media and their information from all sorts of platforms. Is the World Service’s audience ageing? You talk about the issue of switching to digital. Are they interested in digital services, which the young clearly are? Do you have an issue with an ageing audience in the World Service who are effectively, whatever you do, going to decline? These are questions that I, with a taxpayer hat on, would like to know that you have thought about, because I do not think it is just a question of chucking money at it. Whenever I sit at this table, all state entities ever want to do is hurl cash at the situation and hire more people. The digital age means you do not need to hire more people. You do not necessarily need more cash; what you need is more intellect. The question is, are you able to judge that you are delivering using the digital revolution, which has changed everything?

I totally agree. We are discussing it daily, if not most hours of the day.

But you cannot judge it if you do not have the information.

Bear with me. You have touched on a number of important subjects there. The first one is trust, which we could get to in other elements of the discussion. Holding trust is critical, and ensuring that we deliver on that is sacrosanct to the BBC. When we make mistakes, that costs us. We work very hard to deliver against our editorial guidelines; that is important. I would be very cautious about saying that people, even groups, do not trust us. That is not where the evidence is at the moment: it says it is under pressure around traditional media operations, but globally, among all age groups, trust levels are high. We should protect that.

I think you will find, Tim, that the young do not go to the BBC.

We found in our last Report, Tim, that only 51% of the young get their information from the BBC. That is a shocking statistic.

Absolutely, but at least we are in a position where the majority of 16 to 34-year-olds come to the BBC every week. We are still fighting that battle. Do we think we have massive challenges, like every traditional media organisation? Of course we have. The idea then that we do not work extremely hard—I will come to the team in a minute about how we go to where young audiences are, on different platforms. I have quite a lot of pressure to remove the BBC from X, by the way; that is not what I will be doing. We need to be on these platforms. We need to give quality information on these social media platforms, bring people in, and that is critical. The Chinese and the Iranians are flooding the zone; they are investing very hard. Separately—because there is a lot in what you said—the other thing is efficiency. I do not think there is any naivety in the BBC around the idea that you just chuck more people at a problem and that is how you solve it. [Interruption.] No, hold on—push back at me on the facts, because during this period we have taken 1,800 people out of the BBC public service. I think that is the latest number. We have taken the number down. These guys have done a savings plan where we have lost 400 people from the World Service and largely kept the audience flat on the long-term, decade basis. No one is more committed. We have ripped out £700 million of cost so that we can protect our programming and service budgets, while taking hundreds of millions out of our back office. I welcome you to wander around the World Service. I have been very aggressive in terms of getting external benchmarking of our benchmark cost. Then we get to technology. It is a bit “Yes, but”: yes, when we look at AI and what it can deliver to production processes and media supply chain, we are leading edge on this. If you go around the world and talk to other broadcasters, they want to know what the BBC is doing to reduce cost in the area you are talking about. But you cannot escape that, if you want to have quality editorial and quality journalism, you will need investment. I do not think it is incompatible to say that we are rigorous and aggressive on the savings front. Give me the data, because we are doing external benchmarking going into the licence fee settlement. I could not agree with you more on the ruthless looking at our resources and going to the bone in terms of people. But you cannot escape that our service is different from X, which is a model that is contributed to by the public and others. The market square where everyone shouts at each other is one model—I am not disputing it. What we do is something different. We do quality journalism with people on the ground, such as the Persian service; the World Service has 300 people living in exile, because what they are trying to do is free and fair reporting. That is not something that can be replaced by technology. We have to decide that, and we have to build trust in everyone that we are an efficient operation. In any benchmarks or assessments of the BBC, we should be proud of what we are doing in terms of our cost.

I do not have much more time, as I can feel the Chair itching on my left, but I think editorial product and distribution are different issues—you have to split the two.

I totally agree.

I think I can safely say that, since the Long Parliament, the British have been very suspicious of monopolies. You would be the first monopoly in history to dismantle itself willingly and deliver value for money, so I find it very difficult. I am very concerned that the taxpayer, as usual, is on the wrong end of this deal; when I read this Report, I am concerned. There is a lot that you need to take account of going forward. On that note, I will stop.

Chair, can I respond to that?

Of course.

Thank you so much. I agree with an awful lot in your question, but not quite all of it. For a start, we are in no way saying that we will throw more and more people to solve our problems. The Polish service, which Fiona described earlier, is run on four people—just four people. That is a model of efficiency that we are pioneering in the World Service. The World Service costs about 87p per year for each of its users, and those users are measured per week. We do not know how much the Russian and Chinese models cost per user because they are not transparent about their figures, but I can guarantee you that it is multiple times—multiple, multiple times—more than that per user. The only model that was comparable with us has just been defunded: the USAGM structure. That was more than double the cost per user of the World Service. On your point, which is an important one, about metrics of success other than finance, we do a lot of research, which is independently commissioned and not done by the BBC, on the BBC’s influence around the world. Year after year, it shows consistently that while the UK has a lot of exports around the world that are important for the brand value of UK plc—the premier league is one of those, and the royal family is another—the BBC is off the scale in terms of influence and importance to the UK. It affects the impression of the UK, trade, relations and even opinion formers sending their children to school here. It says something about the values of the UK. Those are really important benchmarks and metrics, and we track them very closely.

We have to be a growth investment, to your point. If we are just a lump of public cost, I do not think we are looking at this in the right way. We have to see it as an incredibly efficient growth investment for UK plc. The data suggests that people connect with the BBC and the World Service—if I want cheering up in my job, and there are days I do, I can pretty much go anywhere in the world and talk to them about the BBC. We have an incredible asset that delivers investment to the UK, and if we do not believe that and are not making that case, we clearly have to improve. You can see that the Report says there are things we can do in our documentation, but broadly speaking, the overall metrics on return on investment are extremely strong for the World Service, and I am very proud of the team. Walk around the fifth floor in Broadcasting House and go to see those teams: hundreds of people have left, but they maintain the numbers.

I am sure we can have a further debate on this, but I am not sure that UK plc is in particularly good health. We are looking at the economy here being destroyed.

That is a topic I will probably not go into in this Committee meeting.

Let us have a debate about that at a different time. Are you spreading the word on something that is failing within?

We are not spreading the word in terms of advocating for the UK Government. That is not our job.

We are not Victorian Britain.

Exactly. We fly a flag in a different way on behalf of the UK, and we are very happy to do so.

That is a decision for all of us, Mr Lowe. It is a decision for all of us on what we think of this investment in the World Service, which is separate to the UK creative economy and our global positioning, with the licence fee and all that brings. This is a decision for us all about whether we want to invest in something. I am just giving the view of someone who has been in the job for a while and looks at this situation of our overall competitiveness. What Jonathan said is very important: the flag we are waving is for democracy, principle, truth and reporting. We are not perfect—we know that, and we can have that discussion—but overall, if you look at the numbers, we are No. 1 on those metrics, statistically, around the world. My view is that that is a sensible investment, and a very powerful investment to make for UK households, who want to see these success stories for the UK thrive. It is absolutely right that we do that highly cost-efficiently, we look at technology, and we are healthily paranoid about ageing audiences—all those things—but it is easy to pick holes. The issue is, do we think that this is a cost-effective weapon to grow the UK, in terms of all that that means?

I don’t think we are picking holes, Tim. I think what we are saying is, “Let’s get at the truth.” That is where we want to be.

I think we are in exactly the same position on that.

I will end there, Chair.

That is a good place for you to end. I have one short question—or maybe more, depending on the answers—and then we are going to take a break. You made a very important point, Jonathan, that these are three individual programmes; it wasn’t a three-year programme. In the first year, you made your savings—I am looking at figure 7—of £28.5 million, but you did it by cutting a lot of television and radio services around the world, and you lost 47 million in audience numbers in the process. In the second year, you have not yet made it. It was supposed to be £17.4 million but you actually saved £13.3 million, and you are about to lose another 5 million in audience numbers. On phase 3—that is this year’s—you are well short. You were supposed to make £11.1 million in savings, and you made £5 million. My question is—it goes back to the question I asked you earlier—what did you do at the end of each of those three years to evaluate before you went on to the next year? For example, if I take you to paragraph 2.9 on page 28, it says: “In October 2024, the Service concluded that the structures had not met the needs they were designed to address and presented challenges that undermined effective delivery of strategic objectives.” This tells me that this was a process that you weren’t learning from as you went along.

I think there were some valid points in the critique in paragraph 2.8 about the year-by-year nature of the learnings. I think that is a point well made by colleagues at the NAO, and we welcome it. Each year, as part of the process of not only closing the budget but setting targets for savings the following year, we always look back at the state of play at that moment. As you rightly point out, year 1 was okay—I think it was pretty much bang on—but in year 2 there was some slippage, and in year 3 there was more slippage. For example, at the end of year 2—I mentioned this earlier, but just for clarity—we found savings elsewhere in the BBC to offset some of the savings that we weren’t able to make in the World Service at that time, for the reasons we have been through before. I suggest I don’t go through them again, because they are quite repetitive. Year 3 was slightly different because we did, as I mentioned earlier in response to a question from Mr Turmaine, make a strategic choice to pause some of the savings in order to restructure properly for the future. The learnings from each year are different; they are not the same learnings. Year 1 was the year when platform services were closed, not whole services, as we were discussing earlier—for example, the delivery of audio services in Arabic and some other broadcast services in Africa. Some of the services that we then invested in as part of the rearrangement of savings had been started only relatively recently, in a programme sponsored by the Foreign Office called World 2020 where they asked us to expand our footprint of language services. That led to an increase in the grant in aid funds. All of that was quite a complicated picture and, of course, year 1 was also in the aftermath of covid, so it was quite a complicated, difficult equation. The NAO made a point in paragraph 2.8 about the paperwork and the learnings where we put down a marker and say, “How did we do in this particular year, and what does that do in terms of the effect on the following year’s separate plan?”. I think the NAO is right that we have some learnings to take away and to refine our processes to make sure that when we look back on them—for example, now, looking back on those three years—there is a clearer assessment of what did and didn’t work. If we dig down deep into existing data, for example, on audience loss and on reach on digital, which has quadrupled in the 10-year period up to today, we can see that there is a good story to tell. But I fully accept, looking at the accountancy process and things associated with it at that time, that we have improvements to make.

As well as, hopefully, getting this extra money so that you can make some changes, do you have a continuing savings programme so that you are looking at everything you do to make sure that, actually, you are doing it in as cost-effective a way as you could?

It is a continuous savings programme across the BBC, including the whole of BBC News, and that will affect the World Service. How much it affects the World Service will depend on the Foreign Office settlement. One of the things we have said to the Foreign Office—and we have said this over a number of years; this isn’t a new message and, as you know, there have been a number of different Foreign Secretaries and Ministers in recent years—is that we believe that the freeze in the licence fee under the previous Government for, effectively, two and a half years, because the licence-fee rise in the third year was below inflation, had the unintended consequence of cutting the available funds for the World Service. I do not believe that anybody sat there and thought, “We’ll freeze the licence fee and damage the World Service deliberately.” I honestly do not believe anyone thought that; I think it was an unintended consequence. In order to plug that gap, we needed an increase in what was known at the time as grant in aid; I just call it—to Rupert Lowe’s point—taxpayers’ money. It is central Government money. Some of that money can mitigate the need for cuts in the World Service against the backdrop of further spending restrictions in the BBC as a whole. Until we know what that settlement is, it is really hard—in fact, I would say impossible—to accurately give you an assessment of what we will need that money to do for us.

As you say, this will probably be for further discussion by this Committee over time, but there is no scenario in which the BBC is not having to make aggressive efficiency savings in the forthcoming period, regardless of the charter settlement and how we go into the intricacies of funding the BBC. The reason is if you look at where the market is, you have two things going on. You have rapid inflation in terms of production cost and supply. We are fighting with competitors with £17 billion content budgets. If you care about UK creativity, if you are in my job, you are trying to get as much money to the frontline, not building up bureaucracy; that is just a disaster. The BBC, for all its slings and arrows of fortune, actually has this clear mission: because it has direct accountability to offer value to households, we absolutely have to do that. We will be aggressive in terms of deploying AI and thinking about how we rewire our production. This is going to be an age of enormous change and that is important because I do not want to see public service broadcasting wither in traditional formats and sitting on linear services. To Mr Lowe’s point, the next generation goes, “Well, that’s not for me.” We need to be on YouTube; we need to be there if we care about this. Redoing that, within the constraint of a budget that is not heavily leveraged in the way we have seen with the major entities around the world—they have billions of leverage—is a completely different model. We have done a remarkable job—I would say that—over the last five years of staying at the races digitally. Look at us: among 16 to 34-year-olds we are only UK source in the top 10 in terms of being trusted. We are still at the races. I have issues with the numbers, but we are in the game. The iPlayer is still a very competitive product. That is because we have moved enormous amounts. Some 80%, I think, of the savings in the BBC that you hear about are actually because we as a management have chosen to move money around, not just because we have been forced by our overall funding settlement, but because we as leaders are going, “We’ve got to move money in the organisation to become a digital entity.” That will not stop, and I think it is going to be very tough. I am sure it is the same with any public institution: if we are going to truly transform ourselves and not get left behind, we are going to have to deliver enormous efficiencies. It is not going to be easy and the jeopardy is high here. That does not detract from the need for investment. This is where I think, unfortunately, that it is an “and”, not an “or”, based on where the world is going. That is inevitable.

Thank you for that very interesting answer and for all your answers this morning. We are going to take a short break. It is 11.18 am, so shall we be back here fairly promptly by 11.25 am? Sarah Green will start when we come back. Thank you very much for this morning’s evidence; we look forward to more interesting revelations in part two. Sitting suspended. On resuming—

Welcome back to the hearing, and we start with Sarah Green’s questions.

To return to the management of the savings programme, which we were discussing before we broke, the NAO Report refers to the lessons-learned exercise that the service did, but says there is not a well-developed process for implementing those lessons learned. I am keen to understand what assurances you can give the Committee that the changes you are implementing will lead to the improvements you hope they will?

I will talk a little bit about how we did the lessons-learned process from savings 1. Savings 1, as we have talked about, was editorial and scope-based, so there were closures of programmes and platforms to make the savings. As part of that, there was a change in the operating model. Previously, we had been in a regional model and then we went to an output and content model. That reflected the BBC’s English newsroom—that is how it is organised, into news content and news programmes. There was a decision to do that to enable us to meet the objectives set out in savings 1. That operating model took some time to settle down, because it was a significant change. We were tilting towards digital, so there was a lot of upskilling to do. There were a lot of training programmes, there was a lot of best practice sharing across services, and some new accounts were opening in digital. It was quite a big and significant change. The lessons-learned process was primarily at the editorial level. It looked at the editorial decision-making points, the amount of content, the balance and mix of the content, and the different outputs. In terms of where those decisions were made and how they were communicated—even so far as the timings of the meetings—it was quite a detailed process. A large number of staff were involved in that through workshops and various things. The outcomes of those were implemented in the working of the newsrooms around the world, and they had some success in improving the communications and decision making in the new model. In that part, the lessons learned were done well and were fairly robust. I think where the NAO Report comes in is more around the governance, the documentation and some of the things we have already talked about: the financial inputs, outputs and outcomes. On that, we have made the point that we do not think that that was clear enough and we need to do it differently in the future. We have put some measures in place, which I can talk about if that is helpful.

I think it would be helpful, and it was really helpful for you to have shared about the editorial side. In paragraph 2.22 of the Report, which you might have a copy of, the NAO lists some of the changes that you are implementing around tracking finances and the recommendations following whistleblowing. I think it would be helpful for the Committee to better understand some of those changes.

In terms of tracking finances, we have introduced a new monthly tracking system, which brings together more of the financial data, including savings and EFT—the posts across the business—into a single place. It is a regular meeting, with all the people in the room, to ensure that we have full transparency. That goes up to stakeholders and people who need to see that. That monthly tracking system is new.

Is it in place?

Yes, we have already started that. Jonathan and Tim referred earlier to the accountancy software. At the moment, the World Service operates in 50 different countries, so what the accountancy systems are doing—we are in the process of doing this at the moment—is about consistency, to make sure that they can all feed into the monthly tracking system and that that can have a lot more resilience compared with where it was. One of the difficulties with the previous savings was that, although most of the savings happened in the World Service, there were dependencies, so other parts of the BBC were making savings to support their own savings targets and ours. Those things were not communicating as they should. Those are the things that have been put in place. I should also mention a new role on the news board: the transformation director. That is someone who is looking across our constant process of change. That has really helped, because they can take a wider view—it is not just the World Service or other parts of news; it is overall. Those are some of the things we have done to improve that. Whistleblowing is a very important process that we have in the BBC, and we are always grateful when people come forward and talk. The recommendations that came from whistleblowing are, in some ways, reflected by the NAO; there is a lot of overlap between what it found and what was found in the whistleblowing. The things that we have done answer both the whistleblowing and the NAO recommendations. On changes related to the new structure, some of these are around how we organise our decision making and how we document it, implement it and review it. We started a new process nine months ago—a quarterly performance review. That is a much wider-ranging meeting, but it stems from a workstream. That looks at the non-financial outcomes. It looks very clearly at the inputs, financial and otherwise; the outputs, including the content volume and the mix, which I have previously talked about; and the outcomes that we are hoping to achieve around our audiences in terms of reach, trust and value. That process, which involves all the new regional directors in the structure, is a robust and helpful thing that we have done.

Is there anything that is not on this list that is currently being implemented? This would have been written and researched a short while ago, so is there anything that you would like to add to it?

Yes. One of the learnings from me—from reading this, absorbing it and acting on it—is about our metrics systems. We have a very strong audience team in the BBC, and they have an enormous amount of expertise and metrics from digital and from our global audience measure, which I am sure you have seen in the Report. We have recently made a big change on our dashboards, which means that every journalist, in their morning read-in, is looking to see how their site and the socials are performing. It is such a useful tool because it is live feedback and live metrics. A lot of journalists across the World Service are metrics-driven; they really want their stories to do well and really want to learn what their audiences want. To Mr Lowe’s point, there is also demographic data. We know which young people are reading something and what the proportion of women looking at it is. So alongside everything else, we have done a lot of work around our metrics database, which helps inform our decision at an even greater level.

I want to go back to metrics and KPIs in a moment, but can I ask about the digital-first approach first? We say that there is a digital-first approach, but many things can be digital: a DAB radio station, a video on demand platform, somebody else’s video on demand platform, Facebook, YouTube and news aggregators. Most of the media landscape these days is digital. So what do you mean by digital-first? And why did the NAO have to report back that some teams involved were not clear on what good looks like in the digital-first approach?

Let’s just do the strategic point. It is an extremely well-made point. Digital-first meant moving to online. That debate has been had in the BBC, and now everything is digital. So we are looking back on our programme—and it worked, by the way. We said digital-first because organisations can be slow to change, and successful organisations can be particularly slow to change, because they defend their position, and the BBC does pretty well. So we needed to agitate to make sure that iPlayer, sports apps and all those things—we hired engineers, and hundreds of millions of pounds was taken out of other areas—were competitive digitally. What that really means is that the whole organisation has gone digital, but we are talking about online services, by which I mean fully owned and operated online services and third-party services, in YouTube and—

So, all, in other words.

Yes, it means online content.

For clarity, in your question you mentioned DAB radio stations. For us, we class that as radio. In World Service terms, this is the year when digital has become the biggest delivery; it has just overtaken radio. It has only just overtaken radio; radio is a remarkably resilient platform. Television is the third of the three. They are quite close, but digital now accounts for just over 130 million of our global audience measure, which is the biggest single delivery of the three.

The NAO Report says in paragraph 2.15 that some teams were not clear what good looked like in that strategy. What does it look like?

It is measured on a number of metrics. Global audience measure—or the reach—is probably the most important data point. There is a breakdown of that in the figure about the demographic of people we are reaching. The point was made earlier that younger audiences, in particular, are far more likely to come to us on a digital platform than on a linear platform, in most parts of the world. I was in Lagos pretty recently, where we operate a number of language services, and all but one of them are digital-only. What good looks like there is a matter of reach and the demographic of that reach. That is quite a complicated breakdown, because there is Instagram, TikTok, YouTube and other platforms, and social media posts in their simplest forms too, and they are all measured. Digital audiences can be measured in real time, whereas there is usually a backlog in the way that we measure linear audiences. If there is confusion, I suspect that it is in those services where we have multiple platforms, with digital and linear still going on. There are quite a few of those still, despite changes we have made. That is largely because television and radio are resilient forms of delivery to certain markets. In some markets we are going back into linear, in a way that we had withdrawn from. For example, we have just relaunched an Urdu language television bulletin for Pakistan, but digital is still by far and away the biggest reach there—it has nearly doubled in the last four years in Pakistan.

Sorry—you have just done it again. Digital is the biggest—what does that mean? Do you mean being on YouTube and Facebook? Do you mean your own, owned digital channels?

All of the above.

So that is not one thing.

Let us unpack that. The most important reach for us is reach where people can see and feel that they are with the BBC. We used to call that valued reach, where they are looking at a product and they know it is the BBC. But the real purpose of World Service news is to put truth into markets where truth is in scarce supply. If that truth is carried on a third-party platform but it still reaches the audience, that is still very effective reach; it is just not attributed reach in quite the same way. We measure and accumulate them all, and the digital figure is for all of those platforms, whether they are owned and operated by the BBC or carried on third-party platforms.

This is very standard stuff, to a degree, but let me explain—this goes across the BBC, by the way. Your first point is fair: the semantics of this can be unhelpful at times. We are talking about online, in that regard. DAB is traditional broadcasting. But everything is digital, so we now, internally, talk a bit more about “online” and making sure that a digital-first organisation means that you have a strong online presence. What are the metrics? Clearly they are about audience reach and demographics. That is overarching, to make sure that we have a very simple objective: we know that people who are exposed to the World Service and the BBC are 43% more likely to invest in Britain. We believe that that is a good thing, and we have lots of data that says that it is a good thing. That is reach. However, within that—and this is a challenge for editorial teams, who traditionally produce half-hour programmes—what does good look like online? Is it that you have a small piece of YouTube content? We need to evolve our metrics. We need a classic brand pyramid—forgive the jargon—which shows how many people in total go to the BBC, including third-party. That is an incredibly important metric for us, but it is also important that we look at how many people use BBC services. In terms of attributing value, particularly in the UK, when I say that 80% of people use the BBC every week and 94% every month, that is BBC services. But in terms of maintaining universality, you are going to have to also look at third-party reach. It is classic stuff. We are now developing metrics where we look at total reach and at reach on our services. I think that what you are hearing in the Report about a number of our editorial teams is totally natural. If you are producing “The Traitors” or producing a World Service “Newshour” programme, what does success look like on online platforms? That experience is iterative, because you are learning—“Maybe that doesn’t work.” Look at news on iPlayer. We want a large portion of the audience to be getting quality news on iPlayer, but just putting the 6 o’clock news on it is not going to work. There is an element of that here—how do you make it work?

To be clear, on the non-attributed content—

Less attributed.

Well, it depends what the user sees, right?

We can secure an element of branding in it, yes.

So there is a sliding scale. You have an amazingly valuable asset that only maintains its value by being used. I would suggest that, for the long-term benefit to UK plc and the world, you have to maintain that brand equity. The swings in audience reach over a 10-year period that you were talking about are enormous—some might say suspiciously large. Does somebody who stumbles across something from the BBC on a social media feed once a week count as audience reach in the same way as someone who is a regular listener to a World Service radio or TV station?

It is done by a method called the global audience measure, which is an annual, internationally recognised measure that all major global broadcasters use; some, like our colleagues in China and Russia, have less transparency around their figures, but we know that to be true. That does count interactions with the BBC on a weekly basis, but you have to interact with the BBC at least once a week to count.

Is the simple answer to my question “yes”?

Specifically on viewing a social media post, Fiona, I don’t know whether you—

Yes, it is a duration. If you just scroll past it, you don’t count.

You have to have dwell time.

If you watch it for 10 seconds, it counts. You must engage with it for it to count.

So that counts as having engaged with the BBC once a week. Would another individual, who was a regular listener to World Service news, count the same?

Correct.

That is a one-to-one equivalent.

As long as they come once a week.

If they are just looking at it on a mobile phone, that is just a view. It does not count to GAM. GAM is a weekly audience figure. There is a big chart on it. It is a complicated process, but in essence, it takes a variety of different measures, and on digital, there is a duration in order to do it, which counts as a view, and then it is extrapolated from that.

Okay. I am not sure that I quite followed that answer in its full majesty. I am trying to understand. There has been this huge increase in audience, and you would expect—with the growth of social media, YouTube and all the rest of it—that people are going to be exposed, or can be exposed, to a much wider range of media. Is that the reason your audience reach figure has gone up so dramatically over 10 years? I think the answer is “yes”, but it would perhaps be helpful to get it on the record.

Yes, but it is a bit more complicated than that. As I mentioned a little earlier, we had quite a big expansion programme into new languages, funded by the Foreign Office, which has done quite a lot to raise—

Traditional distribution as well.

In both traditional and digital. That is the first point—we have expanded. For example, in Africa, we have added seven or eight new languages in that period. That takes us to key audiences of need, for example in Somalia or northern Nigeria, and so on and so forth. That is part of the picture. Another part of the picture is that, like all media organisations, we are clearly available multi-platform. We have a much more advanced Instagram and YouTube strategy now than we did before this period started, for obvious reasons. The platforms have become more mature and the competition has become more acute, and therefore we are more present on them. But we have also invested in linear products where those linear products are still growing. Television is still growing in Africa, for example, so it is not the case that the whole world is moving at the same pace on digital. Clearly, the digital penetration in some parts of the world is much more mature. Take, for example, Latin America. We know that Venezuela is top of the world’s news agenda right now. BBC Mundo is one of the oldest language services. It used to have radio and television; it is now purely a digital service. But its reach is really impressive against that background, particularly in Mexico and the northern part of South America. I have not seen the latest figures for Venezuela, but I can promise you that they will be enormous, because at times of crisis people come to the BBC as an external teller of the story of their part of the world. That is a story where we took a language service and we de-invested in linear, and said, “Look, linear is not where that market is. We want to pile on digital in that market.” That market itself, however, is changing because of the loss of USAGM. They were huge in Latin America.

To your question, the answer is “yes”. Okay?

Okay. Thank you.

The reason I am saying that is that it is a very, very good question, if I may say so.

You may!

Let’s have a moment of agreement, Mr Hinds. There is almost a minimum amount of time and connection that you want with someone so that they ascribe value. We get to another thing, which is ascribing value to a service so that people will pay for it. The good news for us is that most organisations are at monthly, but we are at weekly, so we have set the bar a bit higher. Also, we have not done it so that if you just swipe one piece of BBC content, it counts. There is a degree of depth in what we are recording.

Got it.

We believe that to be meaningful; it is only about 10 seconds, but we also know that people who are doing that are likely to repeat it. The other thing is that value attribution is not just about time. This is about the BBC more generally. It is a real tension for all of us, because we have grown up in an age where you would be on an intravenous drip on the radio station, or whatever. Actually, if you in a country go to the BBC headlines, you might not spend that long—you might read a couple of articles and be out—but the value to you is extreme. That is what we are tracking.

I do not want to cut you short, Tim, but I am conscious that we are short of time. Reach is one measure. People might say that the better measure is share, and specifically share not just overall in the world but among young people. In a lot of the countries that we are talking about, young people are the majority of people in the country. You would say, “What about countries that are unstable or where there’s a lot of contestability from competitor broadcasting services?” Do we measure share?

We do where it is possible, but it is not always possible. We do measure the demographics of people who come to us, particularly around the ratio of female consumers. There is a Foreign Office agreed target that 34% of our audience should be female globally, outside the UK. We are just about at that target, but we would like to be more successful in it, and we are launching various products to try to address that, particularly in Africa. We know about the age profile of digital consumers on platforms where there is sign-in. That is an easy piece of data to acquire. Share requires knowledge of what, for example, the Chinese and Russians are able to do. In some markets we can measure that, but we can’t measure it in all markets and, unlike us, they are not transparent about it. If we go and do a sample test in a market, we can judge it, but we cannot necessarily extrapolate that around the world.

I am not sure that share is the best measure. Commercially, I used to be obsessed with share, by the way.

You are advertising—

Bear with me. That is everything, which is why I shiver when I hear the idea that there is any monopoly. What I think is most important for the BBC is that we have a meaningful relationship with a lot of people, and that we are part of their media mix. Commercially, I am interested in growing share, but I actually think—

Yes, but in a broader sense we know that RT and Sputnik have been growing. They buy share. We know that CGTN buys share. The fact that you may be reaching more people for a minute a week on social media, interspersed with other things, is a good thing but it doesn’t tell us we’re winning any battle.

But there are some things we can’t know. Without spending a lot of money on market research, we can’t know the demographic share in every market. We sample year by year as part of the GAM. One point about the GAM, on the 10-second point, is that if you come more than once a week, you still only count once, and if you come to English and your local language, you only count once. The number of people who are coming at any one time is significantly more than the 418 million figure would suggest because you could only ever count once.

Let’s just lock the point because I agree that my head was more, if I’m honest, at local media and all those things. When you look at the market we are in, with those other players and, often, bad actors, our reach and share, or volume of consumption, is critical to monitor. They are important metrics, I agree.

I have one last question. I suspect that the value of the World Service to this country and to freedom and peace around the world is huge. How do you prove it? Do you feel you have compelling metrics that can demonstrate it not just to the FCDO but more broadly to the western alliance? We are in a new geopolitical phase now; there are some things that different countries can bring to the table that others can’t. Do you have that value story?

That is a critical question.

Yes, it is a really critical question. The answer is, “Yes, in a world of imperfect statistics.” If you look, for example, at trust, which we discussed earlier this morning as part of the earlier question-and-answer session, the BBC’s trust score for the World Service globally is rated at around 78% currently. That compares with 70% for CNN, 70% for Al Jazeera and 62% for CGTN, though that is rising because of its presence in the world.

It is worth saying those figures out loud again, if you don’t mind. Could you tell us again the trust figure, in the Chinese state broadcaster—

It’s rising.

And the trust figure in Russia Today?

I have two figures, one for 2021 and one for 2025. This is the growth story of those two enterprises. CGTN in 2021 was at 62%, and it is now at 70%, so it has gone up eight percentage points since that year. That is about investment in markets, and there is a similar pattern, but more, in Russia. RT has gone from 59% in 2021 to 71% in 2025. That is quite a stark increase in those state actor trust scores. We are stable—we have gone from 77% to 78%, so it is within the margin of error. It is really stable. I think that is good.

In orders of magnitude, those numbers are the same.

Correct.

Jonathan, I want to follow Damian’s question on digital. You said very clearly that the switch to digital is different in different parts of the world. I wonder, in your cost savings plans, whether some of your assumptions were ahead of the curve. You overestimated the BBC’s ability to persuade people to switch to digital. One of the recommendations in the Report is that you should conduct more audience research in these countries to work out what the switch is likely to be. I wonder whether, in fact, your cost-savings programmes weren’t as effective as they should have been because you overestimated the switch to digital.

We monitor, so regularly, the markets that we operate in, in terms of their digital maturity. Yes, it is about internet penetration, but it is also about looking at competitors—often the state broadcaster, as well as commercial broadcasters and online media. We are looking really carefully at those markets. But there are also measures that we look at where things can turn very quickly. Data costs are a really big one. For a long time, data costs in many of our markets have been prohibitively high, meaning that mass consumption is not going to be possible, particularly for video. Obviously, you use more data, in terms of either an app or a site, with video rather than text. These things are carefully monitored—and regularly—because we need to be there, ready, when those switches happen. It is a really fine balance, on the digital maturity of the market and the relative investment for the BBC on linear versus digital. In answer to your question, were we at exactly the right point in all those markets? No, probably not, because it is an inexact science. But effort goes into trying to predict that by watching those trends in some countries and considering what they might lead to in similar markets around the world.

You can see where I am going with this. You overestimated in the past; are you still going to be overestimating in the future, in some parts of the world?

I think we would apply the same criteria and the lessons that we have learned in other places. The value of the data, as Jonathan says, is imperfect, but there is a lot of it. One of the things we have talked about—Jonathan has mentioned it today—is, where we have come off linear, whether it was the right time to do that. Arabic radio is the one that we are often asked about. It was impossible for us to predict at that point what was going to happen with the terrible events of 7 October and the devastation of Gaza afterwards. Would we have done it in retrospect? No, but at the point that we decided it, we had looked at both the Arabic and the Persian audience. I will take the Persian service as an example here; it has a very strong television channel and an incredible digital offer and market. We reach one in four people in Iran at this critical time. It is an impressive statistic. The radio that they had was taking some resource, but between 1% to 2% of that audience in Iran were consuming only radio; many people who were consuming radio were already consuming digital content on their mobiles as well—on the site or socials. So, where we have to make difficult choices, we are going to make the choices that are going to protect as many audiences as possible, but invest in the digital future.

Just for context, in terms of the choices that Fiona mentions, it is true in almost all cases that making television or radio is more expensive than doing digital journalism. We talked about our Polish service earlier; that has a headcount of four people and is the smallest service we have. Some of the other services—Vietnamese, for example—have only a few more than that, as digital-only services. The moment that you start adding in television studios, camera operators and all that side of television—the mechanics of making television—you put your cost base up. That is not necessarily the wrong thing to do, but it requires a bigger return on that investment because the investment itself is bigger. In a scenario where the budget envelope is tightening every year because of the licence-fee squeeze and the all the things we talked about earlier this morning, choices are inevitable; we have to make selections. Not all of them will be perfect in retrospect, and we totally accept the NAO’s point about learning lessons as we go along in that regard.

I hesitated about whether to ask you this, but Fiona, how are you getting on with your representations to the United Nations about the oppression of your reporters in Iran?

Thank you for bringing that up. It is a massively concerning, evolving and worsening picture for our colleagues in the Persian service. It is just over 100 people. Some have been tried in absentia. Some have had their houses—there have been financial sanctions against them. Some have had their families brought in for questioning. There is just constant harassment. I worry now, with what is going on in terms of those protests and the Persian service being so crucial in the BBC’s reporting of that. I do not know whether anybody has managed to see the news this morning, but a tracker that BBC Persian and BBC Verify have been working on together shows the spread of the protests, their size, the scope and what is behind them. It is a really impressive piece of journalism, if you get a chance to look at it. We are talking to the UN and to many other journalist organisations about this, and I would say that we still need to bring it up. We need as much representation as we can possibly get, and we will be very grateful for any help that Members can give us. It is not the only service that is under pressure like this. Seven of our Russian service have been named as foreign agents, and we have difficulties in the horn of Africa and many of our other services. It is a worsening situation, not just for press freedom but for the targeting of journalists—the ability of people to get at the BBC through our journalists.

We think we have about 300 people living in exile at the moment, who cannot go home because of the pressures. I spent quite a lot of time with the Persian service, providing support. I really welcome the question. We need to be vocal about it and very clear, and give support. The team are doing a really good job of giving support, but it is sobering, and the issue is growing. The threat levels are growing, and we should all be clear about that. I know we do not want to go too far backwards, but can I add something? The dataset is a really important question as we make the case for whether this thing should get more money. We have an imperfect dataset. We have an incredible dataset on return on investment, in terms of efficiency—we can debate the quality of some of the documentation or whatever, but it is good—and we have a really compelling set of data, but we are in a situation where others are investing hard, and investing cleverly as well, by the way. It is not just pure propaganda in the way it appears; it is smart, and therefore people trust it and they see it. The overall trust metric is one thing, but let us get underneath it. We’ve got quite a lot of really important data on how people perceive the UK and democracy—I will not go through all the numbers, but we have a lot of that attitudinal data. But attitudinal data is sometimes quite hard to invest against, because it requires you to say, “We can see that we have a long-term strategic threat in how people think about the UK and the west.” A huge topic that we want to think about is this idea of how people think about the west and the UK. Are we all equal? Is it that they are all as bad as each other? Well, we do not believe that, in terms of free reporting and the way we work. The attitudinal data is overwhelming and can be mapped in terms of where the world would be in 10 years’ time if we withdrew and did not have those types of services. We can also map the attitudinal impact of how the UK would be perceived if we exited, and it is not good. So I think that dataset is really compelling. Sometimes, as this Committee knows, you are in a debate about an immediate funding requirement—to fund something in bricks and mortar, or immediately—but this is a strategic investment. That is where the dataset sits. I have thought a lot about how we could improve that dataset, but I think that is what it is, and we all have to say, “We understand it, we believe it, and this is what we want to invest in.”

Tim, will you let us have a note on that dataset?

Absolutely. We can give you some of the data that we have, which is very clear. I think we can share that, totally. We would like you to have it.

On that point, since I am also participating in the FAC inquiry into disinformation, I would be very keen to see any breakdown of how RT and CGTN have achieved very extraordinary levels of trust.

We will make sure it is shared.

You talked about the courage of your journalists in a number of places where it is very difficult, and we absolutely recognise that, but one service has caused me and a lot of people concern, as you know—we have discussed it before—and that is BBC Arabic. As you say, trust is absolutely critical, yet two reports now, one by a former BBC controller and the other by a former BBC governor, detailed what they saw as frequent examples of bias against Israel in the reporting of the conflict there. Also, Michael Prescott’s note to the board following discussions in the EGSC suggested that you particularly, Jonathan, had been dismissive of David Grossman’s reports of where bias was occurring and said that there was not a problem. Michael Prescott’s report says that there is systemic bias within the BBC that has to be addressed. Can you say something about that, because that is clearly going to affect trust?

Before Jonathan responds, I want to say that we all understand the seriousness. The most important thing the BBC needs to do is deliver on its editorial guidelines and be trusted. We all have the same intent on that, and we must deliver an impartial service. That is what we must do. We are also not perfect. We make mistakes, and it is really important that we recognise and address them. With regard to Arabic, we are taking some actions, and Jonathan can talk about that. We were taking them before the Prescott report, and we have implemented things. Many people working in the Arabic service are doing an outstanding job, and we should be proud of the reporting that we are doing, but we have fixed issues, and Jonathan can talk about those. I note that Michael Prescott said in his evidence to the CMS Committee that he did not believe that the BBC is institutionally biased. We are all committed to the same thing here. We have recognised some issues. The team are doing an incredible job in really tough circumstances, but we had improvements to make and we made them. We are monitoring it really closely, and Jonathan can give you details on that.

I am happy to do that. Thank you for raising it. I am not defensive or dismissive, I hope, but let me outline the position as I see it. First of all, I think we all recognise that covering Gaza is covering the most polarising international story of our generation. It is an extraordinarily difficult story, and finding the impartial space is hard because impartiality is a perception, not a science. People come to it with different perspectives, depending on their starting points, and that is perfectly natural. Michael Prescott, who, as you say, Sir John, sat on the EGSC as an external adviser to the BBC, identified three items that he was concerned about. To put that in context, there were 11,000 online articles from BBC Arabic from 7 October 2023 to the end of last year. Now, three may not be the sum total of things that he had a problem with, but it is a very, very small sample of journalism, which was incredibly closely scrutinised by people who were looking at the tone and nature of the coverage. That is not to say at all that we are in any way complacent about the strain on the team in covering this story and the support they need to get the story right day in, day out. It is primarily important—it is absolutely grade A important. To help you as a Committee, let me run through some of the things we have done at the BBC to give more support to teams and call out more clearly where we think there are improvements to be made. The first thing refers back to a point I made earlier, which is that I felt that, as a result of earlier restructures, there was not clear enough line management accountability, so we have changed that. We changed it way before the Michael Prescott report, by the way. We have put in a regional director, who is a specialist in the middle east and an Arabic speaker. We have put in a head of service for Arabic, which unifies television, radio and digital. They were separately managed in previous structures, which I did not favour because of the accountability point I made earlier. For the World Service as a whole, we have brought in a new head of editorial standards and quality, who was recruited partly because he is an Arabic speaker. He is an excellent, very experienced colleague with global experience, and he is working very closely with Arabic leadership to ensure they are fit for purpose in all regards, most particularly in training. There is a whole new training programme being rolled out. It started late last year. Again, before the Prescott memo was leaked to the papers, that was already under way. Specifically, on a couple of the points in the reports to the EGSC, I think they made a valid point about the newspaper review, which was a daily part of content. We have overhauled that and changed it. I think there were some valid points about the coverage around the first anniversary of 7 October—so 7 October 2024. There was some very good journalism around the BBC, but not all of it surfaced on Arabic. We have put in measures to ensure that has changed. On the second anniversary—at that time, of course, hostages were still being held, and it was still a very live story—I think we were materially better as a result of that. All those things have been done. They have not all been triggered by the EGSC, although the reports to the EGSC were helpful in making sure that what we were doing was right, and that we got the measures we wanted in place in the right frame. We have made some tweaks and adjustments since then. I think it is important that we all recognise something, and I want to make a case to you today as members of the Committee with an interest in this issue. BBC Arabic is doing an incredible job on radio, television and online without being allowed access to Gaza. It is reporting it all remotely, and that is not for want of trying. We have tried endlessly to get into Gaza, and we are allowed in only on Israeli military embeds, which is not free journalism. I call on the Israelis again to let us into Gaza so that we can report this story from the ground in Gaza, in the way we are allowed to do in Israel.

Do you want to talk about contributors and social media activity? On our list, we have also made a change, which I think you will have seen, to make sure that we have a full grip of that issue. The team have done some good work in that area.

Rolling news platforms are hungry for contributors—that is, for people to come on the air and talk about something they know about or have witnessed. That happens all the time on all sorts of stories. Clearly, with the Gaza story, in the case of BBC Arabic, it is certainly right and a perfectly fair critique that some are allowed on air whose background views are egregious, such as people who celebrated the Holocaust. That is not an acceptable resting place for the BBC. We were already checking social media back to 7 October 2023 to find out what they had said about the Hamas atrocity against Israeli citizens on that date and subsequently. As a result of some people coming to light who were interviewed on BBC Arabic platforms and had historical egregious views, we have now overhauled that diligence. We now take it back to the birth of their social media footprint. We have very sophisticated tools for doing that, using our colleagues in BBC Monitoring as well as the BBC Arabic editorial team. That is not necessarily to ban people, although it of course raises the bar on the sorts of people we want on the air in a legitimate way to commentate on events. It is to ensure that they are properly challenged about any views they have expressed. Of course, in the most egregious cases, they may be unsuitable to interview at all. I am very confident that we now have a much better system of vetting. I am aware of one person who has got through the net in the time since the new vetting process was introduced. That was a mistake in the communication about the process of the vetting itself, which we have plugged. The complaints overall have significantly dropped off. Of course, there may be another reason for that, which is that the level of the story has dropped away because the ceasefire is largely holding, so I am not going to attribute the drop in complaints specifically to what we have done. We have more complaints overall in the BBC that we are pro-Israeli than the opposite. Both complaints piles are relatively chunky, as you would expect from a very polarising story, but it is not the case that everybody thinks that we are leaning in a pro-Arabic, pro-Palestinian way. The opposite is actually true: the majority of opinion, where we can measure it, is that we take a different perspective. For the avoidance of doubt, we do not take any perspective, but in terms of the perceptions of the audience, it is important to put that into the discussion.

You have set out a number of changes to address problems. Do you accept that these problems were being flagged? I am going back to the Asserson report, as well as the report by Danny Cohen and Baroness Deech, and then Michael Prescott’s report internally. Certainly, Michael Prescott suggests that the complaints were not taken seriously when they were first made. Do you accept that you should have taken action much earlier?

On the Prescott memorandum, all the issues he raised in connection with BBC Arabic—indeed, there are some other issues that are not necessarily relevant to the World Service—were discussed and dealt with in the EGSC. We may not have all agreed about the course of action that should have been taken, and he chose to write to the chair of the BBC with his concerns as he stepped down from that role. That was perfectly within his rights, and there was nothing wrong with that. But in any editorial process, there are going to be different views about how we achieve a desired goal. It is often the case that you look back on a set of circumstances and think, “Well, we could have acted a little bit more quickly on that.” Of course, that is often right; I would not demur from that at all. There are some things, such as the measures that I have just outlined, where I think it is fair to say that some of these things could have been done earlier. There were good reasons why they were not, to do with the management restructure—I will not get into that too much, because frankly it is quite tedious. If we make an improvement in our processes anywhere in the BBC, it is always legitimate to ask, “Could you have done this earlier?” Often the answer in any circumstances is, “Yes, in some cases we could have done.”

One issue before I move on to my substantive question. Isn’t it the case that your ability to objectively and fully report on the situation in Gaza would be greatly helped if the Israelis allowed your journalists in to do that?

One hundred per cent.

Absolutely. We have been clear about that from day one.

We have spent a lot of time with reporters on the border. You have probably seen Jeremy Bowen, Lyse Doucet, Lucy Williamson and others standing on the border, and, of course, BBC Arabic colleagues are in the same position as our English language teams. You cannot report any story properly without being there. Eyewitness is the most powerful tool in journalism. Not being able to talk to people directly and experience what they are going through is a serious handicap to reporting any story.

It is important just to get that on the record.

Thank you very much.

The new regional structure that you are bringing in, where I think the World Service and your other operations are put together under regional directors, has been in operation now for a number of months.

It came in on an interim post basis in May, so it is not quite a year yet.

Right. Is it working? If so, how do you know it is working?

Yes. There are six regional directors. Only one of them is permanently in post, but we are recruiting and advertising right now for the others. The other roles are in post, but they are interim. The one that is in post is Africa, where we have appointed an internal candidate who has grown up through the BBC system. She started with the BBC in BBC Monitoring and then came into World Service languages. She is an outstanding, relatively young female African leader. To my mind, the idea that that is not an improvement on Africa being managed from London does not compute. I think that she and her base in Nairobi are going to have an excellent period in growing our African services. She will be supported by a new structure. It is all back-office stuff: new HR, new business protocols, business and operations leadership and finance leadership, which may well address some of the underlying points in the NAO Report about change programmes in the future. To your point about whether it is working, it is early days to see metrics in terms of reach or audience demographics—the things we talked about earlier in response to questions from colleagues. But the ideas flow that we are getting from the regional directors is absolutely inspiring and really positive. To take another example, the regional director for the Americas is currently heavily involved, as you would expect, in the way the BBC as a whole, including the World Service, is covering events in Venezuela and potential events in Greenland. That single line of accountability and that clarity about who is in charge of the BBC’s news operation in those parts of the world is a significant improvement.

It is so obvious. Why haven’t you done it before?

That is a question I ask myself. The change programme that we talked about in the context of the NAO Report back in 2022 made some management changes driven fundamentally by cost pressures. I respect entirely the pressures that were on predecessors of mine in that role at the time. They were also against a very pressing timeline that the NAO has identified caused us some problems that we discussed earlier. I do not believe there is any such thing as a perfect structure. But when I walked in and looked at what had been done then, I felt that, to use a little bit of jargon—forgive me—there were too many horizontal roles and not enough vertical roles. I wanted to look down the system and say, ”That person is in charge of this bit of the world, and if this bit of the world is going right or wrong, that person is taking the credit or the blame so that there is accountability.” We took a little time to work out how we could do that on a cost-neutral basis, because we took out some management jobs that were based in London and were spanning the world in different functions. We were still a couple of roles short, so we had to work out how to do that. For the reasons we have just discussed, we cannot keep inflating our prices and our costs in leadership or in any other function. That took us a little while, but I am really pleased with the model. We have some way to go in terms of maturing it down, and that will require permanent appointments. The next appointment will be in Asia-Pacific based in Bangkok and then in Delhi for south Asia. And then we will move westwards to—

I wish we had done this sooner—to your point, Chair. It is a good question. But we feel that way about many things in life, don’t we? I am a big believer in a single point of accountability and leadership. You can talk process, but if you haven’t got the right leader in place, whether it is a school, a football team or a division of the BBC, it does not work. I think what Jonathan has done is right. We are all inheriting history, but often you would go on the ground and there would be the World Service, the other news bit and all kinds of things, so having a leader whereby we say—exactly as Jonathan was saying—“Okay, how are we covering the Americas?”, or wherever, is a real step forward for us, as is getting outstanding people in those jobs, which we have got. They are fantastic jobs, by the way; they are great jobs.

In terms of the finances, does this enable you to deliver the savings you already planned to make, or is it going to lead to extra savings and extra costs?

Jonathan was given the brief by me and the other teams that we could inject these leadership roles but he would have to find the savings elsewhere, so that it was cost-neutral. Then these executives are pretty well placed to look at where you make savings and where you invest, and run the place in a way that gives us more control and grip across savings and investment.

So it is cost-neutral to deliver a better service, with a possibility of more cost-effectiveness in future?

Ideally, yes. The cost neutrality is an important starting point for the structure. Clearly, we were not going to invent more and more management posts in this environment. There will be parts of the world whose objective of growth is easier to deliver than in other parts of the world. That is to do with the market conditions; it is to do with the competition and the editorial space. I have been quite a few times recently to Delhi—for various structural reasons—and the market there is very saturated, but there is a real opportunity for the BBC to grow its footprint in India. It is our biggest single regional market outside the UK; it has a reach of about 80 million a week. But the population of India, as you know, is well over 1 billion, so that is a small proportion of the population. We want to grow that. Having a leader in India who understands that market is surely a better way of pulling that lever than having a leader in London who is remote from that market. That is really the objective.

We worked really hard to get the number of senior leaders, as a percentage of our population, down to a tiny amount, so I am not moving on that; I want to see that go only one way, in terms of spans of control and everything. There is no way we are putting in another six senior leaders without working really hard to get the saving. There is another element here. It is worth saying that, in somewhere like the US, where we have bbc.com working and where we are investing and looking at a subscription layer and other things, this does allow you, in terms of news and working with BBC Studios and others, to say, “Okay, where there is commercial opportunity, we should take it.” If we were all sitting with some investment capital, the news business might not be top of our list, but certainly there are opportunities. Economies like India, for the long term, offer really interesting opportunities in terms of how you can begin to monetise our factual content. I don’t think there is a pot of gold there, but there is definitely a way we could do it where you have the right market; you haven’t got a democratic deficit. You are never going to do that in Afghanistan—I say “never”: not for some time—or in the Persian Service. But there are ways in which we can then co-ordinate the BBC and help our finances in that way as well.

Tim, we are in the last few minutes. You did say that you are not shackled in the way you were. You also said at the beginning that we were at a critical point, you felt, for the BBC World Service. We have not heard a lot this morning about other actors—China and Russia. Do you want to say something about the environment that the BBC World Service is operating in?

I will let Jonathan speak because he has some of the detail of this, but we definitely are—I spoke about this earlier—in a position where there is a battle for who owns the narrative, the storytelling. Underpinning that is a battle around values. Misinformation and disinformation are utterly rife. The zone is flooded. I said earlier that they are “flooding the zone”. We have bad actors deliberately trying to affect the mindsets of populations domestically and internationally. They are predatory and they are active. They are investing and playing a very long-term game. Often, they are not constrained by the democratic cycle. They are playing over decades to reshape the way people think about the west, including the UK. But we have an asset here that is proven to affect the situation in terms of how people think about the UK and how they think about truth and misinformation. For all our problems—and, boy, I have lived them—you can see us struggling. Where we make a mistake, we recognise it, we debate it and we talk about it. We are open and transparent about that. That is something I think we should be fighting for, and it requires investment. The interesting thing—and I take Mr Lowe’s point about efficiencies—is that you cannot close off all the current distribution costs and just go online, because that is too risky. You lose a lot of reach in that way, so you have to keep both plates spinning on distribution. In order to do what I think we should be doing, the cost for the UK in the round is relatively small. I am conscious that household budgets are under the most enormous pressure. I understand the implications; the pressure is enormous. We are paying public money and it is precious. But we know, for instance, that currently we are spending £300 million or £400 million on this service. If we spent £600 million or £700 million, we could double the impact. Imagine one in 10 people getting a service from the BBC with the qualities we demand of ourselves in forums like this. Imagine we could do that. I know that when you get to the departmental budgets, the framework is incredibly tough. We have brilliant people working through all those dilemmas, but when you step back from it, I think it is a short-term decision not to invest properly. Hold us to account on efficiency, by the way—brutally. On all the questions, hold us to account on it. We should be investing in this service, and I absolutely think we should be investing aggressively in it, otherwise we are going to lose a position of strength that is essential not only to the UK but to global democracy. I really believe that. The stakes in my lifetime have never been higher.

Have you ever modelled the possibility of the World Service becoming a subscription service? That could ultimately give you a very good view of who is prepared to pay for it, even if it were a very minimal charge.

We are always looking. We have launched a subscription layer in news in the US as bbc.com.

I mean globally, because you were talking about India and other countries that are getting quite rich.

We cannot see that. I would love it if you could present—I am ready to go.

I am asking you whether you have thought about it or discussed it.

We are always looking at that, but the problem is that a subscription news business, by definition, would be a completely different shape in terms of its content, because you inevitably become click-based in a way that we should not be. I cannot see models, in most of the economy where we have democratic deficits and all the other things, in which a subscription news business could work in this way. Honestly, I cannot see it. We are aggressive commercially. No one in the world has got a £2 billion commercial arm with an EBITDA margin that is pretty good and cash returns that are not bad. On the news business, show me any semblance of economics that would do two things—one is maintain your reach, which is what we are trying to do and what I am talking about. I am all for a discussion about the commercial BBC globally and how we can return that, but in news, that would radically affect your reach. It is not whether you can make a model work; it is whether, at the end of it, you would be reaching 2% of the population. We have an incredible business in the US called BritBox. In terms of asset value, it is immense. We built it from nothing, and it has got four million US subscribers. It is wonderful, but it is only about 1% of the US. What you want is a different discussion. If you move to subscription, you will kill the reach. You give me one subscription model that has got the reach we have got. China and Russia are not moving to that model, by the way. We would just be irrelevant very quickly.

As a huge fan of the World Service—and I know you have other fans around this table—I think you have given us an enormous amount of your time and knowledge this morning. We are very grateful to all three of you. We will digest that in the coming weeks and produce a Report. The uncorrected transcript will be available in the coming days. Again, my huge thanks to you for your time this morning.