BBC Subsidiary Unit Created Despite Protest Strikes

Culture Secretary Chris Smith has announced his approval of the establishment of a BBC Resources unit which will operate as a wholly owned subsidiary of the BBC.

The technicians’ union Bectu recently called a number of strikes protesting against this saying it was the thin end of the wedge of privatisation (see BBC Strikes Could Hit World Cup).

However, Smith has stipulated that the Unit cannot be privatised at a later date without the Secretary of State’s consent. He said: “I must also have regard to the need for BBC Resources to trade, and be seen to trade fairly. To that end, I am requiring that the new company publishes full and separate accounts.”

The new BBC Resources company will also be required to pay the Corporation for the use of its brand. This could prove very costly for the Resources unit depending on the determination of the value of the BBC brand by an accountant. The alternative is that BBC Resources drops the BBC prefix from its name.

This requirement was imposed by the Office of Fair Trading to secure fair competition and prevent the subsidiary from gaining from licence fee funding.

Department For Culture, Media & Sport: 0171 211 6266