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Fe fydd gen i fwy i ddweud am hyn yn ystod y dydd ond er gwybodaeth dyma'r cyngor cyfreithiol llawn ynghylch S4C.

Os ydy'r cyngor yn gywir nid yn unig y byddai angen deddfwriaeth i orfodi toriadau gwariant ar S4C does dim hawl gan y Sianel i ddychwelyd arian i'r llywodraeth o'i gwirfodd. Os felly mae'n bosib bod y Sianel wedi torri'r gyfraith trwy gytuno i doriad o £2m yn gynharach eleni a'i bod yn gwybod hynny. Ai dyna sydd wrth wraidd helyntion y misoedd diwethaf?

S4C - PAYMENT OF PRESCRIBED AMOUNT
ADVICE SUMMARY
1. I am asked to advise S4C on one question concerning the power of S4C to make
a voluntary payment to the Department of Culture, Olympics, Media and Sport
("the Department") of money paid to S4C pursuant to section 61 of the
Broadcasting Act 1990 ("the Act").
2. For the reasons given below, S4C has no legal power to make voluntary payments
to the Department of money received pursuant to section 61 of the Act and such
voluntary payments would be unlawful.
BACKGROUND
3 As part of the United Kingdom government's efforts to reduce public spending in
the current financial year, the Department wishes to see a reduction of
approximately 3 to 5% in the funding made available by the Department to S4C.
The Department has indicated that it accepts that it has to provide a certain level
of funding under section 61 of the Act but has asked whether S4C would agree to
reduce its funding on a voluntary basis. The mechanism for effecting this
voluntary reduction would be that the Department would pay the money due
under section 61 of the Act but S4C would then make a voluntary repayment of
part of the monies received.
LEGAL FRAMEWORK
4. Section 56 of the Act keeps in existence the Welsh Fourth Channel Authority,
referred to in the Act as the Welsh Authority. That Authority is to be known as
S4C. That is a body corporate comprised of a chairman and appointed members.
A number of its functions are delegated to a Board of Directors.
5. Funding, in part, is dealt with by section 61 of the Act. The Secretary of State
must in each year, pay the prescribed amount to S4C as increased by the
appropriate percentage. The prescribed amount is the amount actually received in
1997 or an amount being greater than the 1997 amount (the amount being
prescribed by the Secretary of State by order). There is no power to prescribe an
amount less than the amount paid in 1997. The prescribed amount is to be
increased by the appropriate percentage (defined in section 61(6) of the Act as,
effectively the percentage increase between the retail price index for November
1996 and the November for the year preceding the year of payment).
6. Section 61A(2) of the Act, as amended, provides that:
"(2) All amounts received by the Welsh Authority under section 61 shall
be kept by the Authority in a separate fund (in this section referred to as
"the public service fund") which may be applied only for the purposes of
their functions in relation to the provisions of the services that are public
services of the Authority within the meaning of section 207 of the
Communications Act 2003."
7. Those public services are defined as S4C, S4C Digital and services authorised by
or under section 205 of the Communications Act 2003 ("the 2003 Act).
ANALYSIS
8. The Secretary of State is obliged each year to pay the prescribed amount,
increased by the appropriate percentage, to S4C under section 61 of the 1990 Act.
9. Monies received under section 61 of the Act "may be applied only for the
purpose" of S4C's functions in relation to the provision of S4C's public services.
S4C has no power to make payments of monies for other purposes. In my opinion,
therefore, S4C has no power to make voluntary payments of money received
under section 61 of the Act to the Department (whether for the purposes of
assisting with the government's policy or otherwise). Parliament has imposed a
duty as to how monies received under section 61 of the Act are to be used. Those
monies are to be applied only for the purpose of S4C's functions in relation to the
provision of public services, i.e. the provision of S4C, S4C Digital and services
authorised under section 205 of the 2003 Act. There is no provision for S4C to
make voluntary payments to the Department for other purposes.
10. Separately and in addition, the proposal whereby the Secretary of State would
seek to effect a cut in the amount provided to S4C by making payment of the
prescribed amount and then arranging for part of that to be repaid voluntarily
would not, in my opinion, be consistent with the statutory framework set out insection 61 and 61A of the Act. Parliament has prescribed a funding mechanism
which involves payment of the prescribed amount (the amount received in 1997
or a greater amount) increased by the appropriate percentage. S4C must keep that
money in a separate fund and apply that money only for the purposes of the
provision of public services. It would not be consistent with that framework for
the Department or S4C to enter into arrangements intended to ensure that less
than the money contemplated by Parliament as being necessary for the provision
of S4C's public services would be provided.
CONCLUSIONS
11. In summary, therefore, S4C has no power to make voluntary payments of money
to the Department from monies provided by the Department to S4C. Monies
received under section 61 of the Act may only be used for the provision of public
services as defined in the 2003 Act and not for making voluntary payments to the
Department.

CLIVE LEWIS Q.C.
Mai 2010

A dyma lythyr llawn Peter Hain at yr Yrsgrifennydd Gwladol;

Dear Cheryl,

I enclose a copy of Counsel's opinion which says that any cuts to S4C budget, either voluntary or otherwise, are illegal.

It is very clear from Counsel's opinion that should your Government wish to impose any cuts on the S4C budget you would have to introduce primary legislation to do so.

I therefore request that your Government postpone any plans for immediate cuts to the S4C budget, and not accept any voluntary repayments, to avoid being in breach of the law.

If you proceed regardless, I will give my full support for a judicial review.

The S4C budget should always be scrutinised, and we would welcome a debate about the future of S4C and Welsh language broadcasting in general. But we will not support these sudden and illegal cuts, especially as Wales is already suffering more than anywhere else because of the actions of your Government.

I will be writing in similar terms to the Secretary of State for Culture, Olympics, Media and Sport, but would urge you to take a personal interest in this issue.

Peter

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