Tag Archives: Lord Patten

BBC PAYOUTS

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bbcPlenty of questions remain about the extent of payouts made to senior executives at the BBC during the tenure of Mark Thompson as Director General. One Conservative MP Chris Heaton-Harris quoted in The Guardian said today’s hearing by the Public Accounts Committee at Westminster was “the most bizarre game of whack-a-mole I’ve ever seen in my life, where you hit something down and it throws up another load of questions”.

At the end of a three hour hearing by the committee, former DG Thompson and the Chair of the BBC Trust Lord Patten disagreed over who knew what about the executive payoffs. In July a report by the National Audit Office found that in nearly a quarter (14) of 60 cases it reviewed, the BBC had paid departing senior managers more salary in lieu of notice than they were contractually entitled to. A total of 150 senior managers had received severance payments totalling £25m. A supplementary report published a week ago confirmed that 22 former executives received £1.4m more than what the Corporation was contracted to offer in the severance payoffs agreed in the three years to December 2012 (NAO). The NAO said weak governance arrangements had led to payments that exceeded contractual requirements and put public trust at risk. The BBC Trust accepted at the time there had been a “fundamental failure of central oversight and control” at the Corporation.

nujlogo_burgundySpeaking before the PAC meeting the General Secretary of the National Union of Journalists Michelle Stanistreet said “this sorry tale is one of a management that became out of touch with its staff and with the ethos of public service broadcasting. The BBC should have put the interests of licence-fee payers first, rather than fill the pockets of its own”. In total more than £25m was given out in redundancy payments to executives.

The written evidence presented in advance to the PAC by former DG Mark Thompson, Lucy Adams BBC HR Director, Andrew Scadding BBC Head of Corporate Affairs, Marcus Agius, non-executive director, BBC Executive Board and former Chairman of the BBC Executive Board Remuneration Committee, as well as by the BBC Trust can be found here.

Margaret Hodge MP Photo: BBC News

Margaret Hodge MP Photo: BBC News

The PAC Chair Margaret Hodge MP described the appearance by the BBC executives as “grossly unedifying” and said it could only “damage the standing and reputation” of the BBC. “At the best I think what we have seen is incompetence, a lack of central control, a failure to communicate. At its worse we may have seen people covering their backs by being less than open”, she said.

Former BBC Chair Lord Grade told Newsnight the Corporation had “a lost sense of the value of money”.

 

BBC ‘JACUZZI OF CASH’

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BBClogoLooking at the story about the BBC Trust chairman Lord Patten calling the size of severance payments made to senior BBC managers a matter of “shock and dismay”, I wondered why it had taken so long for the ‘gatekeepers’ of the Corporation’s standards to realise what was going on. Seven years ago a senior NUJ official in the broadcasting sector warned about how BBC executives were “bathing themselves in a Jacuzzi of cash, while staff are experiencing a drought”, at a time of staff cutbacks and reductions in their pension benefits.

Speaking in 2006, Paul McLaughlin added that even though the Corporation had capped bonuses at 10% of basic pay – down from 30% two years ago – salary increases meant that senior executives have still seen their total remuneration packages grow significantly. Mr McLaughlin said that as a result senior BBC managers were guaranteed a fixed annual increase in their overall pay and bonus package of 15%. Under the previous bonus scheme, he said, they could get a bigger rise, in theory, but this was more dependent on hitting performance-related targets.  nujlogo_burgundy

“Over the last three years, (2003-2006) basic BBC executive pay has gone up by more than 30%. That’s at a time when the BBC is claiming there is no money and the annual pay deal they have offered this year is below inflation“, the NUJ representative said.

Today the BBC reports the evidence given by Lord Patten to the Public Accounts Committee at Westminster. Interesting to note the comments by Lucy Adams, Director of Human Resources: when asked about why there had been overpayments (severance payments to executives that went beyond contractual terms), she said “the overwhelming focus was to get numbers out of the door as quickly as possible”. I’m waiting to see the report coming up now on Newsnight.

Chair of the Public Accounts Committee Margaret Hodge MP who had earlier been grilling Lord Patten and the new DG Lord Hall, told Jeremy Paxman the equivalent of half the cost of running Radio 4 (£25m) had been spent by the Corporation on exiting 150 senior executives. Now the blame game is starting.

But one former executive did the right thing: former director of archive content Roly Keating gave back a payment of £376,000 on the basis that it was not authorised “fully and appropriately”.