Performance against last year’s objectives 12 Annual Report and Accounts 2001/2002 The Governors’ assessment of the BBC’s performance against the objectives for 2001/2002 is set out below. 1 Strengthen BBC One, as well as all core television and radio services, with a particular focus on offering a richer mix of content This objective was met  The Governors recognise the tension implicit in seeking to strengthen the reach and share of BBC One and other core services while maintaining their distinctiveness. Nonetheless, they believe that the BBC can make programmes of distinction which appeal to large audiences and the investment of an additional £90million in BBC One in the period from 2001 to 2003 is in direct support of this objective.  Highlights on BBC One in the past year ranged from The Way We Live Now to Walking with Beasts, from Clocking Off to The Blue Planet and from Your NHS to Only Fools and Horses.The number of annual hours of drama on BBC One rose from 528 in 2000/2001 to 561 in 2001/2002. At the same time docu-soaps fell from 48 hours in 2001 to an estimated 26 hours in 2002.The number of genres broadcast in peak time on BBC One – 15 – continued to be higher than any other broadcaster. During 2002 more arts programmes, documentaries and serious factual programmes are being scheduled after the Ten O’Clock News.  Additional investment has helped BBC One reassert itself as the primary channel for a broad spread of audiences across the UK. Its share rose both in analogue homes (from 32.1% in 2000/2001 to 34.1% in 2001/2002) and digital homes (from 18.2% to 18.9%).The aggregate figure across all homes fell marginally (from 26.8% to 26.5%) as more homes switched to digital, but across the calendar year 2001, BBC One was the most-watched television channel in the UK, for the first time since the 1950s.This position has been maintained during 2002. The BBC had a strong year in 2001/2002, in which almost all the 12 specific objectives set by the Board of Governors were met.As importantly, it was a year in which the BBC rose to the challenge of major, unforeseen events. Its response in each case exemplified its dedication to the values of public service broadcasting. BBC Four News with George Alagiah and Kirsty Lang. Top: Armadillo, based on a novel by William Boyd, was one of a raft of new dramas on BBC One. Above: Text Message by Jeanette Winterson, a drama from the new Radio 3 series, The Wire. 13  Audiences for other core services generally rose during the year. BBC Two’s share increased across all homes from 11.0% in 2000/2001 to 11.1% in 2001/2002, with rises both in analogue homes (up 0.2%) and in digital homes (up 0.5%).  BBC Radio increased its reach by 1.8 million year on year and its share from 52.1% in the first quarter of 2001 to 52.6% in Quarter One 2002. BBC Radio 2 gained two million new listeners during the year and there were also significant rises in reach for BBC Radio 4, BBC Radio Five Live and BBC Local Radio (including services in the Nations). 2 Launch the approved new digital TV and radio services, and monitor early performance This objective was met  Strong public support for the BBC’s digital proposals was demonstrated in the consultation process during 2000 and the current licence fee settlement provides earmarked funding for new digital services until 2006/2007.The challenge set by the Governors in 2001/2002 was for the BBC to launch services which can begin to play a distinctive role in these new marketplaces, while recognising that, especially in radio, initial audiences are likely to be small.  CBeebies and CBBC launched in February 2002. Both carry much higher levels of original British-made programming than any of the commercial channels. CBeebies, for under-sixes, has achieved critical success and high audiences among young children in a very short period of time. CBBC, targeted at six to 13 year olds, has made slower progress initially in an especially tough market.  BBC Four launched to critical acclaim in March 2002 and attracted an audience reach of 5% in digital homes in its first month on air – over twice the average achieved by its predecessor, BBC Knowledge (three-minute reach figures).  The first two of the BBC’s new digital radio services were launched – BBC Five Live Sports Extra in February 2002 and 6 Music in March 2002. It is difficult to measure audiences for digital radio at this stage.The three remaining services – IXtra, the BBC Asian Network and Network Z (working title) will be launched before the end of 2002.  The BBC is still awaiting permission from the Secretary of State for Culture, Media and Sport to launch its planned digital channel for young adults, BBC Three. 3 Ensure we serve and are valued by currently under-served audiences, particularly the young and minority ethnic audiences This objective was met in part  The BBC has a special responsibility, as a publicly funded broadcaster, to try to ensure that its programmes and services offer value to audiences of all ages and from all ethnic backgrounds.  BBC One’s share among 16 to 34 year olds fell by 0.8% in 2001/2002, to 23.1%.This was greater than the channel’s overall fall in share of 0.3% to 26.5%. BBC Radio, however, increased its listening among 15 to 34 year olds from 9.2 million in 2000/2001 to 9.7 million in 2001/2002 and BBC Radio 1 increased its reach in its target audience of 15 to 24 year olds from 3.5 million to 4.0 million.  Although BBC Choice has increased its reach and share during the year, the BBC still plans to replace it with a new channel, BBC Three, explicitly targeted at younger audiences, with a unique high-quality programme mix in which news, current affairs, education, music and the arts will account for a third of the channel’s new programming.This is dependent on permission from the Secretary of State for Culture, Media and Sport.  Progress has been made in increasing on-screen diversity. Popular dramas like BBC One’s Holby City and EastEnders have successfully reflected multicultural Britain in new ways, as have programmes on BBC Two such as Babyfather and The Kumars at No. 42. Overall representation of minority ethnic groups on BBC television, measured between September and November 2001, was 11.8%. Right: Heart of Harlesden. Far right:Walking with Beasts, a landmark factual programme which linked interactive technology to the power of television. Far left:The Blue Peter team’s summer roadshow. Left: A new look for BBC One. Performance against last year’s objectives 14 Annual Report and Accounts 2001/2002  BBC One’s share among Asian viewers increased from 20.3% in 2000/2001 to 21.8% in 2001/2002, although this still remains below the UK average. Among black viewers, however, share of viewing to BBC One fell from 20.9% to 18.4% during the year.The story is similar on BBC Two.  In radio, too, listening by both black and Asian people remains low, with 50% listening to BBC Radio each week compared with 66% across the total population. Choice for black and Asian listeners will be increased later in 2002 with the launch of 1Xtra, the new digital service dedicated to black music culture, and the expansion of the BBC Asian Network into a UK-wide digital station. 4 Demonstrate improved services to the whole of the UK as part of the BBC’s ongoing response to devolution and regional diversity This objective was met  The BBC has the same responsibility to serve audiences in every part of the country as towards audiences of all ages and ethnic backgrounds.The BBC’s response to devolution and regional diversity has moved beyond news and political reporting to entertainment and factual programming.Tackling underperformance in the North of England has been a priority.  The number of BBC One drama productions set and made in the North in the past year has increased significantly, including Linda Green, Merseybeat, Cutting It, Born and Bred and Auf Wiedersehen, Pet. A new writing initiative run with regional theatres, Northern Exposure, has also been a major success, attracting over 4,000 writers in its first year.  BBC One’s share rose by 1% in the North East and 0.9% in the North West. In Yorkshire and Lincolnshire, where performance was already higher, the rise was 0.1%. All these figures contrast with BBC One’s overall fall in share of 0.3%, though each remains below the channel’s average share across the UK.  The proportion of network television programmes made outside London and the South East rose again, to a new record of 38%. Network programmes commissioned from the Nations also increased, with expenditure rising from £55million in 2000/2001 to £66million in 2001/2002. It is projected to rise to over £90million in 2002/2003.  Increased investment in local television output in the Nations during 2001/2002 helped BBC One’s share rise in peak time in Scotland by 0.6% and in Northern Ireland by 1.1%. BBC One’s share in Wales remains above the network average.  Local radio, including services in the Nations, hit a new record in March 2002 with a weekly reach of 10.9 million listeners a week. BBC regional news remains the market leader in every Nation and Region at lunchtime and in the late evening.The same is true of the main 6.30pm early evening programmes except in Northern Ireland and the North East & Cumbria.  Considerable progress has been made in increasing the localness of BBC services in England. New regional television news services were launched for London, the South East, East Yorkshire & Lincolnshire and the Channel Islands during the year, together with new local radio services for Oxfordshire, Berkshire and specific towns and cities such as Swindon, Milton Keynes and Peterborough.Thirty-seven Where I Live community websites have also been launched across England in a major expansion of the BBC’s local internet presence. 5 Reinvigorate the creativity and capabilities of the BBC’s in-house production teams across the BBC This objective was met  The BBC’s services are only as good as the programmes in their schedules.The challenge for the year was to provide a critical mass of new programming which really resonated with audiences.  BBC Drama has had a highly creative and successful year with new series such as Judge John Deed, Merseybeat and Waking the Dead joining long-running successes such as Casualty and the reinvigorated EastEnders, which has risen splendidly to the challenge of maintaining its quality and distinctiveness while expanding to four episodes a week. The BBC’s Specialist Factual departments have continued their long record of success with new productions such as Right: BBC One produced a second award-winning series of Clocking Off, starring Ricky Tomlinson. Far right: BBC Radio Gloucestershire on the trail of foot-and-mouth disease. The Blue Planet,Walking with Beasts and Son of God and the Children’s department with Stig of the Dump and I Was a Rat. Comedy successes included The Office, Happiness and Manchild.  Radio, benefiting from the reintegration of production staff, has had a strong year creatively, with highlights including new comedy on BBC Radio 2, new writing in The Wire on BBC Radio 3 and Dawn Chorus Day and the Poetry Weekend at the Lowry on BBC Radio 4. BBC network, national and local radio won a total of 22 of this year’s 30 Sony Radio Academy awards.  The television commissioning system is still not working at maximum effectiveness or as collaboratively as it could in factual programming areas, and this is being addressed by the incoming Director of Television and her team. 6 Achieve a step change in the impact on audiences of the BBC’s new media services, including interactive television This objective was met  The BBC’s aim is to become the UK’s number one digital destination. A new media strategy designed to increase the attractiveness and impact of the BBC’s online services and to develop innovative interactive television offerings met with considerable success during the year.  All internet and interactive services across the BBC were rebranded as BBCi last November.Traffic to the BBC’s website increased by 70% during the year, with significant growth in educational and children’s services. Interactive television was launched to critical and popular success, with more than eight million viewers accessing one of its new services. 7 Make a compelling case for the BBC leading the development of a UK-wide digital curriculum and prepare the BBC to play this role Fulfilling this objective is dependent on approval from the Secretary of State  In May 2002 the BBC applied to the Secretary of State for Culture, Media and Sport for approval to develop and launch a digital curriculum service.This would be a new public service from the BBC, allowing it to play a significant role, along with others in the public and private sectors, in the development of the world’s first comprehensive ‘Curriculum Online’ announced by the Government in December 2001.The service would be available via the internet, providing teachers, children and parents across the UK with a valuable new resource and encouraging the uptake of e-learning. 8 Deliver greater value for money for licence payers year on year through increased efficiency and more effective commercial activities This objective was met  This continuing objective requires the BBC to explore ways of delivering the best possible value for money by further reducing its overheads and exploiting appropriate commercial opportunities in both consumer and businessto- business markets.  Licence fee collection achieved a further 0.9% reduction in the evasion rate, which fell from 8.8% to 7.9% (using the new DCMS methodology). Improvements in collection provided the BBC with an extra £43million.  The outsourcing of property and facilities management will save the BBC an estimated £83million by 2006/2007. New premises across the UK will be more appropriate for a modern broadcasting organisation and more accessible for audiences.  The introduction of a single finance system (SAP) across all parts of the BBC has reduced the number of suppliers from 140,000 to 31,000 and will halve finance headcount by 2004.  BBC Worldwide Limited contributed £106million to the BBC this year and is on course to achieve its £210million target by March 2007. BBC Ventures companies have been formed to make significant savings for the BBC and to provide another source of cash flow over time. Far left: Stig of the Dump continued the strong tradition of children’s drama on BBC One. Left: Interactive choices from BBCi brought a new dimension to watching the Winter Olympics. Left: 606 – Radio Five Live’s Saturday phone-in dissects the football action. Right: Up in Town, a BBC Two series of six poignant monologues starring Joanna Lumley. Annual Report and Accounts 2001/2002 15 Performance against last year’s objectives 16 9 Move towards the long-term goal of increasing the percentage of licence fee income spent on programmes to 85% This objective was met – two years early  This objective, set in 2000/2001 to be achieved by 2003/2004, has already been met.The cost of running the BBC was reduced from 24% in April 2000 to 15% by March 2002. 10 Improve our openness and accountability to all stakeholders This objective was met  This continuing objective reflects the Governors’ aim to ensure that the BBC is a model of openness and accountability among broadcasters and other public bodies.  A new framework was developed for modernising BBC accountability and dialogue with audiences in tandem with the governance reforms announced in February 2002. A new Governance & Accountability department has also been formed to provide dedicated support to the Governors in carrying out their central role of monitoring and supervising the BBC’s public interest remit.  New formats for public consultation were piloted during 2001/2002.This year’s Annual Report is designed to be more transparent and accessible and for the first time will be launched outside London (in Birmingham). Statements of Programme Policy for each of the BBC’s services will be published simultaneously.  Audience appreciation of the BBC has risen significantly during the year.Asked “what is your general impression of the BBC?” the average score, measured on a ten point scale, rose from 6.5 to 6.8 across the year.The BBC scores consistently higher than other broadcasters on these measures. Support from opinion formers and MPs in similar surveys also rose. 11 Improve diversity internally – to 10% of staff from minority ethnic backgrounds by end of 2003, with an increase from 2% to 4% at senior management levels Progress continues towards achieving this objective  The past year has seen a steady advance towards achieving the higher targets which were set last year, to be achieved by December 2003.The proportion of staff from minority ethnic groups rose from 8.4% in March 2001 to 8.9% in March 2002. Over the same period the proportion of senior managers rose from 2.6% to 3.2%. 12 Drive a change in BBC culture to generate greater collaboration Progress continues towards achieving this objective  Cultural change takes time to achieve but there was evidence of a shift towards greater co-operation between staff working in different parts of the BBC during the past year.This was reflected in the increased number of major projects which brought staff from different parts of the BBC together, including Your NHS,Walking with Beasts and The Lost World.  The BBC commissions an annual poll from MORI to measure staff attitudes towards internal communication. In 2001/2002 this showed a further 5% overall improvement year on year and brought the BBC into MORI’s top ten communicating organisations.  In February 2002 the Director-General launched Making it Happen, designed to help achieve the long-term goal of creating One BBC and making the BBC the most creative organisation in the world by releasing the innate creativity of every individual who works for it.There are already signs of this initiative bearing fruit. Left:Trinny Woodall and Susannah Constantine telling us What Not to Wear. Right: Posh and Becks – alias Alistair McGowan and Ronni Ancona. Annual Report and Accounts 2001/2002 17 Strengthening BBC programmes and services Underpin the BBC’s public service remit by extending the range and quality of its radio and television services, with a focus on broadcasting more high-impact, memorable programmes, particularly arts and current affairs. Strengthen the BBC’s digital services, to ensure that the overall portfolio has something of value for everyone, provides a wide range of interactive learning opportunities and helps to drive digital take-up. Connecting with all audiences Bring younger audiences to BBC services by developing bold and innovative programmes and content with a particular focus on making the BBC’s news and current affairs more relevant and engaging for this group without diminishing the BBC’s commitment to parliamentary reporting. Continue to seek new ways of attracting audiences from the UK’s ethnic minorities, through both mainstream and targeted services. Ensure that the BBC is meeting the needs of audiences in all nations and regions of the UK. Transforming the BBC Make the BBC feel a more creative, collaborative and exciting organisation, in which all staff fully understand its purpose and values. Ensure that the BBC is more representative of the audiences it serves. In particular:  accelerate progress towards the BBC’s target of 10% of its total workforce and 4% of senior management coming from ethnic minorities by December 2003  increase the proportion of people with disabilities working for the BBC. Providing better value Continue to increase the amount of money available to spend on the BBC’s public services with a particular focus on:  increasing the cash flow to the BBC from improved licence fee collection  increasing the contribution of the BBC’s commercial subsidiaries to its public services  further reducing overheads  improving efficiency in programme production whilst maintaining quality of output. Enhancing the BBC’s reputation at home and abroad Earn greater appreciation from UK audiences for the BBC as an open, creative and trusted public service organisation. Build on the impact made by the BBC’s global news services in the past year through a co-ordinated global news strategy across radio, television and new media. The Statements of Programme Policy which we publish in conjunction with this Annual Report explain in detail how each of our services plans to deliver the BBC’s public service priorities in 2002/2003. Next year’s objectives On the basis of last year’s review of performance and audience needs, these are the objectives set by the BBC Governors for 2002/2003. Left: Juliet Stevenson reads Jane Austen’s Persuasion, a Radio 4 Book at Bedtime. Right: Babyfather, award-winning new drama from BBC Two which will return for a second series.