Strapped 4 Cash?

With negotiations over the next BBC Charter set to begin soon,
the National Assembly demand assurances on S4C's future.
(Pic : theident.gallery)

Until 2013, Welsh language broadcaster S4C was funded by a direct grant from the UK Department of Culture, Media & Sport (DCMS) as well as some commercial revenues. Since 2013, S4C has been mainly funded via the licence fee with the UK Government grant scaled back to a near token amount.

Although the arrangement has worked reasonably well so far, ever closer working with the BBC has raised concerns over S4C's editorial independence. With negotiations set to begin on the BBC Charter renewal for 2017 - alongside serious questions over the future of the licence fee and the remaining DCMS grant - the Welsh Liberal Democrats held a debate on S4C's future on Wednesday (24th June).

Their motion asked the National Assembly to:

• Recognise the value of a Welsh-language broadcaster and the contribution S4C makes to Welsh culture.
• Oppose cuts to the DCMS grant.
• Call upon the Welsh Government to lobby the UK Government in order to maintain S4C's editorial and operational independence on a secure funding basis.

Peter Black AM (Lib Dem, South Wales West) opened the debate by saying there was an opportunity to discuss the role, and secure the future, of Welsh language broadcasting in light of the future BBC Charter (clip). S4C produces 115 hours of programming a week, including the award-winning Cyw and Dal Ati for Welsh-learners, while every £1 spent produces £2.09 for the economy – with Y Gwyll boosting Ceredigion's economy by £1million. A 2013 survey said 96% of S4C viewers believe the channel keeps Welsh a living language.81% of S4C's commissioning budget is spent on independent producers, resulting in £2.2billion of investment since S4C launched in 1982, supporting the growth of the independent TV sector, including companies like Tinopolis, Boom Pictures and Cwmni Da.

The Lib Dems ("in government", of course) worked to ensure financial stability until 2017, but future funding is "at a tipping point" due to uncertainty over licence fee plans. The £6.7million DCMS grant isn't guaranteed beyond this year – which brings the Welsh and UK Tory manifestos into conflict with each other (the Welsh Conservatives support maintaining the current budget).

Peter believes the licence fee is the best way to fund quality PSB (public service broadcasting, see also : Senedd on the Box) but it shouldn't rise above inflation. UK Culture Secretary, John Whittingdale, is on record criticising the licence fee, and there've also been calls to abolish the BBC Trust and replace it with an external regulator – which would impact S4C due to the BBC-S4C agreement.

Suzy Davies AM (Con, South Wales West) described it as a "speculative debate" as there was no indication DCMS would cut S4C's funding (clip), while UK Government funding for S4C's PSB work is "protected by statute". Suzy admits that wouldn't preclude cuts, but the statutory duty is "incompatible with the notion of threats to the channel". She called on AMs to support her party's amendment which called for current DCMS funding to become the responsibility of the Welsh Government (which is in line with Silk II recommendations).

The DCMS contribution is small when compared to the licence fee (£74.5million), and financial challenges have been met by S4C; though Suzy would like to see S4C grow its commercial income (currently ~2% of its budget). She added that S4C's independence has been maintained despite the BBC agreement, and there would be further protection when the BBC Trust introduces a devolved governance body.

Suzy took an intervention from Alun Ffred Jones AM (Plaid, Arfon) who suggested cuts will have impacted programme quality. Suzy said they didn't, but would have impacted administration, adding that she was pleased the St David's Day Agreement proposed placing an obligation on PSB providers to report to the National Assembly.

Bethan Jenkins AM (Plaid, South Wales West) said it's only been a short time since the difficult period of negotiation when S4C was "battling for its future" (clip). Silk II called for (the public expenditure/DCMS element of) S4C to be devolved in 2017, and responsibility could be devolved "with little financial risk". Plaid Cymru want the responsibility and budget for S4C devolved fully to the Welsh Government, and would like to maintain S4C's executive and editorial independence.

Bethan believes cuts to broadcasting are ideologically-driven by a "right-wing press in England, which sees no cultural value in the channel and looks only at how much S4C costs", and it's become a matter of urgency as talks begin on the BBC's future. She added it was unlikely that the UK Tory party would agree with Welsh Conservative opposition to budget cuts, as the UK Government are committed to top-slicing the licence fee to support the roll out of superfast broadband across the UK and shrink the size of the BBC.

She called for Labour and the Lib Dems to go further in supporting devolution of S4C to Wales because if responsibility doesn't lie with Wales, how can we be sure DCMS will act in S4C's interest?

Welsh Lib Dem Leader, Kirsty Williams AM (Lib Dem, Brecon & Radnor) said that changing consumer habits – such as greater tablet and smart phone ownership – had presented challenges and opportunities to S4C which they've met. There's been a 41% increase in Clic viewing sessions (clip) and the move to iPlayer has increased online viewing figures further.

Although S4C needs certainty, all parties in the Assembly called for a fundamental review of S4C, which would be key to rebuilding trust and help set its purpose. She was disappointed a review hadn't happened yet, and the case needs to be made again. Kirsty doesn't support full devolution as the fact S4C gives evidence to Assembly committees and increased Welsh Government involvement means arrangements are working well "without necessitating full devolution of broadcasting".

Aled Roberts AM (Lib Dem, North Wales) said it was worth noting £30million cuts within DCMS, and if it wasn't for the intervention of Danny Alexander, former UK Culture Secretary Maria Miller would've cut even more from S4C (clip). He couldn't understand how Suzy Davies rejects reservations from other parties about the Tory's motivations with regard S4C. He also said that devolving broadcasting without funding would result in the same problem – though Bethan Jenkins said Plaid's proposal is that devolution would come with funding (presumably as part of the block grant).

Aled said politicians in London have no appreciation of the role S4C plays – such as children's programmes and programmes for Welsh-learners. There was a need to rethink how viewing figures are monitored as they don't count children's programmes or digital views, with 380,000 viewers using Clic for children's programmes alone.

Replying on behalf of the Welsh Government, Deputy Minister for Culture, Sport & Tourism, Ken Skates (Lab, Clwyd South), said key decisions were going to be taken on broadcasting and regulatory arrangements in the near future (clip) and the Welsh Government were aware of the importance to S4C of BBC Charter renewal; there's an expectation that the Welsh Government would be involved in charter negotiations.

He said current DCMS and licence fee funding were uncertain and this made forward planning by S4C impossible, adding to concerns about a 36% real terms cut since 2010. Any further cuts would seriously impact output and S4C's ability to provide Welsh language output on multiple platforms.

Ken understood the importance of editorial independence, but wouldn't support the Plaid Cymru amendment, as fully devolving the budget for S4C would impact the licence fee.

The Welsh Government supports S4C's decision to relocate its HQ to Carmarthen, as it might encourage other creative industries to follow suit. He took the opportunity to praise the Welsh Government's economic record, as Welsh creative industries were now the fastest growing outside London.

In reply to the debate, Peter Black said (clip) it was ironic that more than 30 years after a Conservative government established S4C, it was now fighting for its future because of a Conservative government creating the conditions whereby it was "very difficult" for the broadcaster to thrive and invest due to funding uncertainties.

It was "deeply worrying" that the UK Government has an anti-BBC agenda in light of the growth in the creative sector, and Peter said Suzy Davies couldn't deny that the future is uncertain due to DCMS's poor record when it comes to valuing Welsh language broadcasting. He added that the Welsh Government can have a role in broadcasting, but devolving broadcasting in its entirety would be too risky as it would mean "having to unpick the licence fee". He finished by repeating cross-party calls for a full, independent review into S4C.

The motion was unanimously agreed without amendment.

Same purpose, similar programming, similar management structure, better audience figures.
So how does Ireland's TG4 manage on less than half of S4C's budget?
(Pic : broadsheet.ie)

Considering the budget and political pressure they've been under, S4C have done well to maintain a broad spectrum of programming – as the only Welsh language TV broadcaster it has to cater to all tastes anyway. Despite one or two innovative additions to its repertoire (like Dim Byd), and its world-renowned homegrown children's programmes, it's still perhaps pigeonholed as being repeats, rugby, middle aged men walking around fields, One Show-style lifestyle fluff (Heno) and singing, oh the singing!

The channel which you can draw closest comparison to is Irish language broadcaster Teilifís na Gaeilge (TG4). Programming is almost identical, and the management arrangements and structure are almost identical. Like S4C, TG4 commissions nearly all of its own programming from independent producers (except the news) and generates €2 for the economy for every €1 spent. The only major difference is that TG4 have/had rights to US imports (which were broadcast in English) and Scandinavian imports. Viewing figures are significantly better than S4C (TG4 - 526,000 daily reach p11; S4C - 146,000).

Notwithstanding Ireland's larger population, TG4 does this on less than half of S4C's budget – around €38million (£28million) in 2013 (p37). Why is this relevant? It indicates that for all the important work it does in maintaining the Welsh language, even if the current ~£80million a year budget were maintained, we should be getting better value from S4C than we currently are. It's not sacrilegious to question that and while it's obvious I support full devolution of broadcasting (I've written at length on broadcasting) - including the licence fee - that shouldn't mean writing a blank cheque for S4C, nor slashing it to the bone.

I doubt broadcasting costs are that different between Wales and Ireland, so are TG4 simply more efficient? Are S4C being overcharged by production companies? Do S4C need to do more to commercialise their work? Do S4C need to play a more active part with all types of Welsh language media - like literature and radio? All these questions underline the importance of an independent review into S4C's role and what would be expected of it in the future, as until that happens we're going to end up going around in circles every couple of years.