BBC puts squeeze on drama makers

The BBC was accused yesterday of pushing independent television production companies to the brink of collapse by "abusing" its market dominance to impose punitive programme contracts.

Leading producers say they have compiled "damning evidence" of shackling companies to one-sided deals and forcing them to surrender valuable rights in return for commissioning their shows.

Their allegations came as it emerged that small production houses could be driven to bankruptcy after last week's budget closed a "loophole" that gave them access to tax breaks intended for film-makers. Dozens of dramas, including a new version of The Hound of the Baskervilles and Sparkhouse, a contemporary take on Wuthering Heights, face having their budgets slashed or being halted midway through production. Producers will meet the Treasury tomorrow to demand a "transitional period" to safeguard current productions.

The campaign to expose the BBC's allegedly draconian trading practices is led by the Producers Alliance for Cinema and Television, which represents independent production companies.

Its chief executive, John McVay, says day-to-day BBC "abuses" range from offering producers paltry fees and budget advances, to effectively forcing them to hand over lucrative merchandising and distribution rights.

The corporation was also guilty of "double-dipping", he said, by using licence fee payers' money to fund programmes whose cost it then "recouped" through tax breaks meant for producers.

"The BBC will offer a producer a price for a programme that is, say, 20 per cent of its cost, forcing the producer to find the rest from the open market," he said. "BBC Worldwide will then come in with, say, 30 per cent of the finance, which allows the BBC to claim it is fully funding the programme. This is a loaded gun, as the BBC then claims ownership of the rights."

Eileen Gallagher, the managing director of Shed Productions, whose recent television hits include Footballers' Wives and Bad Girls, both for ITV1, said: "We've all heard the BBC's excuse when handing down its rotten deals, that 'no one should profit from the taxpayer.' This is totally disingenuous.

"The BBC quite happily pays Hollywood producers for their shows. It pays profits to football leagues and other sports-rights holders."

A BBC spokeswoman denied categorically that the corporation had "abused" its market position or deprived producers of tax benefits, adding: "There is no question of BBC Worldwide forcing independents to give it distribution rights."