Keeping our capital working for the UK

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Yes, but what’s the BBC ever done for us?

Below is a blog published on Tuesday 20 January on the BBC website by John Dickie, our Director of Strategy and Policy and the former Head of Corporate Affairs at the BBC.

The blog can be viewed here.

The UK economy is becoming less and less dependent on finance and business sectors and more reliant on its creative and tech industries, writes Former Head of BBC Corporate Affairs, John Dickie. In this post, he highlights how BBC activities contribute to London’s economy through its creative TV industries and new technology as well as its investment in smaller independent companies.

I am currently Director of Strategy and Policy at London First, a non-governmental, not-for-profit organisation that aims to help London prosper by working with businesses and all the political parties. I work with our members to create policy ideas which we then recommend to government. I was previously the Head of Corporate Affairs at the BBC and a former Deputy Leader of Camden Council in London.

Everybody knows that the BBC makes great British programmes and provides impartial, high-quality global journalism.

What is perhaps less familiar is the role that these activities play in supporting the creative sector of the UK economy; and the growing importance of that sector.

First, an explanation of my focus on London. My professional experience and knowledge is within the city of London. As Director of Strategy and Policy at London First, our data findings help contextualise London’s economic growth as a whole. Using London First’s data findings I can only speak about London’s economic growth as we aim to influence national and local government policies and investment decisions to support London’s global competitiveness. But similar points can be made across the UK. The BBC’s presence in the national capitals, the UK regions and of course the new hub in Greater Manchester, all help stimulate the local economies of the UK and to tie them together. One of the reasons the BBC has such strength in the creative-tech sector, and in commerce more broadly, is that it is a magnet for global talent which is important for the growing sector.

This is certainly the case in London. Historically, London’s economic growth has been driven by financial and business services; however a combination of tighter regulation and higher capital requirements mean that, important as this sector is, it is unlikely to drive such growth in future.

Research undertaken for London First by McKinsey shows that since the financial crisis it is the creative and technology sectors which have driven London’s economic growth. The creative sector added £6.5bn to the city’s economy between 2009 and 2012, while the technology sector added £2.9bn.

London is emerging as Europe’s creative and tech capital and key to this success is the depth and range of activities that take place here. These activities cover everything from pure-tech companies, such as DeepMind, through companies serving established sectors in e-commerce, food & beverages and finance, to creative, fashion and design. London Fashion Week 2014, for example, saw 5,000 visitors view work from over 150 designers and led to an estimated £100m of orders.

These complementary activities stimulate and support each other. Google’s decision to locate its new headquarters at Kings Cross, in part because it will be next to Central St Martin’s new campus, neatly makes the point. Fashion students plus geeks are greater than the sum of their parts.

The BBC is one of the anchor tenants of this economy, spanning the creation of original content (across television, radio and on-line), new applications (such as the iPlayer) and stimulating new markets (with the UK’s high internet take-up, and high levels of e-commerce, having been in part driven by the online content it provides).

As important as the range is the depth: the Corporation accounts for around 40% of total investment in UK original content and – thanks to the unique way it is funded – it provides distinctive risk capital for the industry.

Much of the £1bn the BBC spends annually on outside suppliers – through hundreds of independent TV, radio and online production companies – goes on programmes that won’t appeal to businesses needing to earn an immediate commercial return.

Some of this spend adds to the breadth of the UK’s creative range – say new music commissioned by Radio 3 – but other investments create more clear-cut economic returns. Strictly Come Dancing is now a mainstream success, earning Britain revenues from overseas licences; but when it launched it was a new and uncertain format, made possible by the BBC’s ability to take risks.

While there are many reasons why people want to come here, one of them is surely the role that the BBC plays in promoting Britain and that elusive concept of Britishness and British values so effectively overseas. Kofi Annan described the World Service as Britain’s gift to the world in the 20th Century. Now the World Service – and increasingly its newer siblings like BBC America – are acting as a gift to the wider UK economy in the 21st.

Greg Dyke’s bold vision for the BBC was for it to be the most creative organisation in the world. It doesn’t really matter whether the BBC has met this objective – indeed almost by definition any really creative organisation is going to ebb and flow over time. What matters is that when you say it to people it sounds reasonable.

To have such a globally resonant brand with such an ambitious, yet credible, goal should not just be seen as a source of national pride, but also as an economic asset that supports jobs and growth.

John Dickie is Director of Strategy and Policy at business membership organisation London First, and a former Head of Corporate Affairs at the BBC.

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