Raymond Snoddy on Broadcasting

The BBC Trust must do more to prove it's not just one big pussycat

No one can fault the energy level of the BBC Trust. Hardly a week goes by without the body that replaced the Governors coming out with weighty pronouncements.

The latest is the corporation's Statement of Programme Policy, trumpeting such innovative and distinctive content as the marking of the 150th anniversary of Darwin's On The Origin Of Species, getting Simon Schama to have a look at American history in the run-up to the US Presidential elections or coming up with a new adaptation of Little Dorrit by Charles Dickens.

Worthy, decent – exactly the sort of programmes that the BBC should be doing – but perhaps a little light on the innovation side.

A few days earlier there was the conclusions of the great investigation into the pay of the BBC's multi-millionaire star presenters and the signing off of the Trust review of the Corporation's online service bbc.co.uk.

Busy, busy, busy maybe but how effective has the BBC Trust been so far and how distinctive and innovative is the corporation's regulatory body turning out to be?

No definitive answer can be produced without the help of a major independent, external consultant's report but a few preliminary thoughts, or at least suspicions, are starting to form.

The trust has been rigorous in dealing with appeals arising from the BBC's complaints procedures and robust in trying to ensure that there is no repeat of the breaches of public trust that so damaged the organisation's reputation last year.

But when it comes to inquiring into how the BBC is run, or proposals for new services, some of the vigour seems to drain away.

With a few occasional caveats, virtually everything the BBC does is judged to be for the best in the best of all possible worlds – much to the growing anger of private sector organisations which have to compete against £3.5bn of licence fee income.

The review of talent costs was a classic of the genre. Independent research showed, the BBC Trust purred, that the BBC was not paying more than "the market price" for top talent and was not systematically pushing up costs in the talent market.

So the £18m three-year contract for Jonathan Ross – the equivalent of 1,000 journalists – is therefore fine and dandy.

Not that we officially know that Jonathan Ross actually gets £18m. The trust studiously ignored all the salary leaks from inside the BBC and hid behind XXXX's .

The trust did admit that sometimes the BBC should be prepared to walk away from deals that do not represent value for money and perhaps tighten their procedures and maybe some radio presenters do indeed get more than the market rate.

But what was difficult to see is what exactly is going to change as a result. It was hardly surprising that the review was denounced either as a "whitewash" or something that missed the point.

As the shadow culture secretary Jeremy Hunt put it, Jonathan Ross may well be worth £18m, the question was whether the BBC should be paying such sums with licence payers' money.

No one is irreplaceable and the BBC is in a uniquely strong position to grow renewable talent and pay them reasonably but not necessarily the full commercial market rate.

Independent producers say they have to accept less for commissions from the corporation, so why not the talent?

As for bbc.co.uk – well that is an excellent service that makes a strong contribution to delivering the BBC's public purpose – as long as they strengthen the financial controls to stop cost overruns.

So is the BBC Trust just one big pussycat? Too soon to tell, but their activities should certainly be kept under review.

And there will soon be another chance to prove themselves over BBC management plans to spend up to £23m a year on new local news services – a prospect that is enraging both local newspapers and local commercial radio.

Eurocrats threaten C4's digital funding

As they set about their scheming, British media types tend to forget about the Eurocrats – until they pounce.

It was the good folks of Brussels who torpedoed Jam, the BBC's ill-fated online education service and forced the Premier League to sell-off television football rights in manageable portions to encourage competition to BSkyB.

Now the European Commission in an interim finding has ruled that the Government-inspired scheme to have the BBC pay Channel 4's digital switchover costs of around £14m breaches competition rules as possible illegal state aid. You can be sure that rivals such as ITV thought it proper to alert the Commission to this little manoeuvre.

Naturally, Channel 4 is playing down the significance of the inquiry, suggesting that it is merely a routine part of the regulatory process. Up to a point.

The assistance might just be let through as a special one-off payment although they shouldn't count on it. There is the small problem that Channel 4 runs a perfectly viable and profitable business – so why should it get a cash subsidy at all?

The big issue, however, is not digital switchover relief but Channel 4's dogged determination to get regular handouts from somebody in future – the BBC licence fee if needs be – to keep it in the manner to which it has become accustomed. Here the Eurocrats are likely to be much more exercised. The language they are already using in the switchover case should give Channel 4 executives pause for thought.

The Eurocrats note that "the mere fact" that the switchover may affect the channel's profitability, but not its viability, does not constitute a valid reason for claiming state funding.

Brussels also uses the Ofcom-commissioned LEK report on Channel 4's finances to make its point. LEK suggested Channel 4 faced the prospect of declining profits but not the loss of its ability to deliver its programme remit. Maybe Channel 4 should think twice before running down its reserves.

Reverse colonialism is no bad thing

The Times of India Group's purchase of Virgin Radio is a very positive development for UK media, one that should be welcomed. The £53m deal protects the future of what is left of the Scottish broadcaster SMG and is a nice example of colonialism in reverse.

For Virgin Radio – though it won't be called that any more – a period of great instability is at an end and the new owners are talking about investing £15m to develop the company. If the venture capitalists had got their hands on Virgin, the chance of long-term investment would have been remote.

Word is that the under-bidders for Virgin included the Malaysian billionaire Ananda Krishnan (left), who has large media interests in Asia. Last month, his company Usaha Tegas provided new capital for Johnston Press, the Edinburgh-based regional newspaper publisher, by buying 20 per cent of it. How long will he be content with 20 per cent with the Johnston share price on the floor?

Looks like we are seeing the start of a trend. Ratan Tata already owns Jaguar and Land Rover, and Lakshmi Mittal is the third-richest man in the world. Will ITV have Indian owners before long?

Raymond Snoddy presents the BBC Television viewer access programme 'Newswatch'