Birt's BBC is given its reward: White Paper praises public service role but also backs wide range of money-making ventures

THE BBC, with John Birt as its director-general, won a ringing endorsement of its role as Britain's leading public service broadcaster from the Government yesterday. It was also given carte blanche to expand into commercial activities, including new satellite and cable channels at home and overseas.

Although privatisation was firmly ruled out, a key passage from yesterday's White Paper says: 'The Government believes the BBC should be able to evolve into an international multi-media enterprise, building on its present commercial services . . . The BBC should expand its commercial activities in the UK and overseas, and continue to join with private sector partners to achieve this.'

The undecided area is the fate of the BBC's valuable transmitter network, which may be sold off.

ITV yesterday urged the Government to privatise the transmitters, to promote competition. It was also concerned about public funds being used to promote profit-raising new companies.

Despite the predictable protests from a few right-wing critics of the Government, the Heritage Secretary, Peter Brooke, secured wide approval for the White Paper in the Commons yesterday, reflecting a marked shift in the Tories' opinion of the BBC.

Tim Renton, a former arts minister, said most people saw the BBC - at a time of channel proliferation - as a 'rock of ages'. From the right of the party, Sir Rhodes Boyson, MP for Brent North, admitted that his attitude had changed towards the BBC: 'I used to be in favour of a free market in broadcasting but I am now much more concerned about the preservation of high culture in our society. We should not leave the BBC to the free market, any more than we do with universities or schools.'

Marjorie Mowlam, the shadow Heritage Secretary, said Labour was 'relieved' the Government had abandoned ideas of privatising the BBC and was continuing with the licence fee system.

The White Paper, Serving the Nation, Competing World-Wide, says the BBC must be more accountable to its audiences, and must not make high-handed changes to services without consulting them. It also says many people believe there is too much violence, sex and bad language.

Overall, the changes will free the BBC to form an alliance with a leading telecommunications company, such as British Telecom, to take advantage of opportunities for screen-based services.

The Government, anxious to reward the BBC management for implementing market-led changes, has also accepted that the licence fee, which raises pounds 1.5bn a year and underpins the BBC's national public service broadcasting role, should remain as the main source of finance at least until 2001, when the arrangement will be reviewed.

A new royal charter should extend the BBC's current arrangements, without significant changes, for another 10 years from 1997, while World Service Radio, funded by the Foreign Office, is also given firm backing and more freedom to run itself.

The Government's new-found confidence in the BBC stems from the tough reforms and 5,000 job cuts bulldozed through by Mr Birt and his team of managers.

Details, page 8

Inside Parliament, page 6

Leading article, page 17

View from City Road, page 33