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Public Value Test
If management proposes to launch a new service or make significant changes to an existing service the BBC Trust will consider the proposal and decide whether to launch a Public Value Test (PVT). Where a PVT is undertaken, the new service or change may not happen until that process is complete.
Background
The Charter makes clear that the BBC should be able to alter its UK public services – for example, to respond to changes in technology, culture, market conditions, public expectations, and so on.
However, any significant proposals for change from BBC management must be subject to full and public scrutiny. The means by which this scrutiny takes place is the Public Value Test.
Public Value Test
The Public Value Test is a mechanism for weighing public value against market impact.
The BBC Trust uses it to determine the value to the public of, say a proposed new BBC service, and also to calculate its impact on the wider market – say, to other suppliers whose business might be affected by the proposed BBC launch.
Only if the Trust is satisfied that any likely adverse impact on the market is justified by the likely public value of the change, will the proposal go forward for consultation. At the end of the consultation, the BBC Trust will then make its decision.
How the Public Value Test works
A Public Value Test has two elements: a public value assessment, and a market impact assessment.
Public value assessment
A public value assessment of a proposed change includes an assessment of:
- Its value to licence fee payers as individuals
- Its value to society as a whole through its contribution to the BBC's Public Purposes
- Its value for money and cost
Public value assessments are conducted by the Trust, with support from the Trust Unit, the independent unit that advises Trustees. As part of the assessment, the Trust seeks representations on the public value aspects of the proposal.
Market impact assessment
Market impact assessments are provided by Ofcom, overseen by a Joint Steering Group (JSG) on which the BBC Trust and Ofcom are equally represented.
The JSG set the terms of reference and agrees the methodology for each assessment, taking account of the scale and scope of the proposed change. The JSG minutes are published on this site.
As part of the assessment, Ofcom seeks representations on the market impact aspects of the proposal.
Timetable
Normally, a Public Value Test must be completed within six months of the BBC Trust deciding that it should be applied and publishing a notice to that effect. The Trust can allow a longer period if justified by circumstances.
Market impact assessments must be completed within three months of the joint steering group setting the terms of reference. The JSG can allow a longer period if justified by circumstnaces.
Process
The Trust has published guidance on the conduct of the Public Value Test process.
Protocol
You can read more about the Public Value Test in the relevant protocol, which can be found on the Protocols page.