Whenever it is asked to save money, the BBC warns that it will have to slash spending on our favourite programmes. Or it increases the BBC licence fee – as will happen from April – and threatens to stop the over-75s from getting free licences. But there is an alternative – the corporation could stop frittering away our money on everything from overpaid staff and outrageous expenses to vanity projects, as ROSS CLARK explains
The BBC bitterly opposed efforts to force it to disclose the salaries of its presenters. When the government finally ordered it to do this two years ago it became clear why. The BBC’s case for keeping the licence fee is based on the assertion that it is a public service broadcaster, producing output which no commercial broadcaster would bother with.
But in that case, why is it competing with the commercial sector by offering fat salaries? These were the highest-paid employees last year – and they don’t even include those employed on a freelance basis through ‘personal service’ companies.
The BBC has also been accused of seeking to hide salaries through a commercial offshoot called BBC Studios. Claudia Winkleman, for example, was paid between £375,000 and £379,999 last year for her Radio 2 show but is thought to earn up to £120,000 more for her appearances on Strictly.
- Gary Lineker: £1.75 – £1.76m
- Chris Evans: £1.66- £1.67m
- Graham Norton: £600K – £609K
- Steve Wright: £550K – £559K
- Huw Edwards: £520K – £529K
- Jeremy Vine: £ 440K – £449K
- Nicky Campbell: £410K – £419K
- Nicky Campbell: £410K – £419K
- John Humphrys: £400K – £409K
- Nick Grimshaw: £400K – £409K
The publication of presenters’ salaries has taken attention away from the high salaries of BBC executives – nine of whom earn more than twice Theresa May’s salary as Prime Minister:
- Tony Hall, Director-General- £450K
- Anne Bulford, Deputy Director General – £435K
- Charlotte Moore, Director, Content – £370K
- Francesca Unsworth, Director News and Current Affairs – £340K
- Glyn Isherwood, Group Finance and Operations Director – £325K
- Ken MacQuarrie, Director Nations and Regions – £325K
- James Purnell, Director, Radio and Education – £315K
- Valarie Hughes-D’Aeth Group HR Director – £310K
- Matthew Postgate Chief Technical and Product Officer – £310K
The BBC has a programme, Cowboy Trap, which features the experiences of homeowners driven to distraction by rotten and overcharging builders. How ironic, then, that when the BBC struggles with its own building projects. In 2010 the National Audit Office was scathing about the project to refurbish and extend Broadcasting House in Central London. The project, ended up costing £1.05billion, which, taking into account the cost of delays, was £107million more than originally projected.
The BBC admitted to ‘serious mistakes’ which had cost the licence fee-payer dearly
Move to Salford
The name of the development in which the BBC’s new studios in Salford are based – MediaCityUK – speaks of an attempt to make Manchester the new broadcasting capital of Britain. But that isn’t how many of 850 staff relocated there saw it.
The BBC ended up bribing them with astonishing relocation payments. The staff were each paid relocation expenses averaging £28,000, while 11 were given payments of more than £100,000 and one was paid £150,000. In some cases staff were paid to rent a property in Greater Manchester and commute back to their homes in London.
In a report in 2013 the Public Accounts Committee was scathing of the excessive level of the payments – and of the BBC’s decision to take out a ten-year lease on studios which technology might have made redundant well before then.
Mark Byford Pay-off
Is there any organisation which can fritter money so freely when it is trying to save it? Mark Byford, who was Deputy Director General between 2004 and 2011 was made redundant in a drive to save money by axing senior jobs.
But his pay-off was as much as some people earn in their entire careers. He was paid a year’s salary of £474,500, another £474,500 ‘in lieu of notice’ – and even £73,000 for holidays he hadn’t taken since he took up the job. In all he received £949,000. In axing 150 posts the BBC managed to spend a total of £25million in exit packages.
Local news websites
In 2008 Ofcom had to stop the BBC spending £68million on expanding local news websites and ‘hyper-local’ news. The BBC couldn’t even see what was wrong in using licence fee-payers money on a project which would inevitably undermine local newspapers, which were already struggling thanks to declining advertising.
The audience of the BBC’s soap has tumbled from 1987 heyday of 21.1million to an average of 6.68million in 2017. But that hasn’t stopped the BBC throwing money at a new set – which it says is needed in order to film the programme in high-definition. The new set, at Elstree in Hertfordshire, was supposed to cost £57million and be ready by 2018. But, according to a report by the National Audit Office last autumn, it will end up costing £86.7million – enough to build approximately 1000 new social housing homes – and won’t be ready until 2021.
The BBC is constantly bleating that it will have to cut popular programmes if it is forced to make economies. A more efficient way of cutting costs would be to stop pay such extravagant sums for air travel.
Last year, BBC accounts revealed, the BBC’s chief technical and product officer Matthew Postgate took a return flight to Miami for an extraordinary £6,880. The accounts don’t say which airline or class of ticket he had, but according to air discount website Skyscanner you could fly direct from Heathrow to Miami next Monday, returning on the Friday, for £749 with FinnAir. Two executives were flown to New York for over-the-odds fares exceeding £2,000 return. Does the BBC bother to shop around when flying its executives around the world?
It is a similar story with taxis. In the three years to 2014, a Freedom of Information request revealed, the BBC spent £34million on taxi fares. In 2014 alone it spent £12million – £24,401 of which was for cancelled bookings. As with air fares, the BBC doesn’t seem to be good at shopping around. According to an item in the BBC’s staff magazine, Ariel, in 2014 an employee used the BBC’s taxi booking system and was quoted £87 for a trip from Tonbridge to Gatwick Airport. He then rang around local firms and was quoted an average of just £45. Ironically, the BBC’s taxi-booking system came with the strapline ‘more money for programmes’ – claiming it was saving money rather than wasting it.
In 2017, the year Glasto turned into a political rally for Jeremy Corbyn, the BBC refused to say how many people it had sent, nor how much it had spent on coverage, but in 2009 it did admit to sending 415 staff to cover the event. It is hardly as if Glastonbury is a great national event watched by the masses like, say, the cup final. In 2016, for example, its peak audience was 1.8million for Lionel Ritchie’s performance.
Digital Media Project
In 2008 the BBC started developing a new digital platform to help producers share and edit video – which according to former Director General Mark Thompson was ‘essential’ for the BBC’s move to Salford. Five years later it scrapped the whole project, after wasting £98 million – having realised it could use off-the-shelf technology for far less money. Mr Thompson’s successor, Tony Hall, admitted to ‘serious concerns’ at how the project was handled.
Storm as over 75s face losing perk – meaning 4.5million households could be forced to pay
The BBC yesterday faced a storm over the future of free TV licences for the over-75s amid rising fears that they will be abolished altogether.
The broadcaster is expected to strip millions of pensioners of the perk after it signed up to an ‘unaffordable’ deal with the Government to cover the cost itself.
Yesterday, former BBC boss Greg Dyke urged the corporation to ‘bite the bullet’ and scrap the benefit for the vast majority of over-75s and only award it to the very poorest households.
But Gordon Brown, the former prime minister, pleaded with the Corporation to keep the perk in place so it does not have to drag ‘frail, housebound, elderly’ pensioners to court.
He also said the BBC should not have to foot the bill for a mistake by the Government.
More than 4.46million homes with older residents get a free licence, saving them £150.50 a year.
The BBC struck a deal with the Government in 2015 to shoulder the cost of the free licences, previously paid for by the Department for Work and Pensions.
The total bill stood at £655million last year but is expected to spiral to more than £1billion by 2029 – around a fifth of the BBC’s current budget. In exchange for this sum, the BBC was allowed to raise the fee in line with inflation – and to close the so-called ‘iPlayer loophole’ and force viewers to have a licence even if they only watch the BBC on catch-up services.
The Government also agreed that the BBC could do away with free TV licences for the over-75s or change the rules so that fewer pensioners are eligible.
Well-placed sources have told the Daily Mail that the Government was ‘astonished’ that the BBC ever accepted their demands.
The Treasury asked BBC bosses to sign up to the deal as an opening gambit in talks over renewing the Corporation’s charter, and had a list of alternative proposals up their sleeve if it was refused.
They expected BBC director general Lord Tony Hall and the then-BBC Trust chairman Rona Fairhead to threaten to resign over the proposal. But the BBC surprised Treasury bosses by agreeing to take on the cost, sources said.
Yesterday Mr Dyke, who was BBC director general from 2000 to 2004, said the broadcaster’s bosses had faced a ‘difficult’ decision but ‘brought trouble for themselves’ by agreeing to Government demands. He said: ‘They accepted a short-term fix and gave themselves a long-term problem. They also face a very difficult decision now. If I were them I would bite the bullet and get rid of it.’
Mr Dyke added that society ‘cossets’ old people and that it is no longer true that they are ‘necessarily’ the poorest section of society.
The BBC has launched a public consultation on free TV licences for the elderly. The consultation, which closes next week, also asks whether the BBC should raise the entitlement age from 75 to 80, or give the over-75s a 50 per cent discount, or means-test the benefit.
Yesterday, Jo Stevens, a Labour member of the Digital, Culture, Media and Sport select committee, said it was ‘unaffordable’ for the BBC to keep the free licences in place and simply swallow the cost.
‘This could be a fifth of the BBC’s budget – the equivalent to what is spent today on all of BBC Two, BBC Three, BBC Four, the BBC News Channel, CBBC and CBeebies,’ she said.
Mr Brown said: ‘We have to ask whether, after 20 years of free licences, the BBC can justify taking a frail, housebound, elderly pensioner to court for not possessing a TV licence that for years she has had for free.’
At the time of the agreement for the BBC to fund the over-75s licences, Lord Hall hailed it as a ‘strong deal’ that gave the Corporation ‘financial stability’.
‘The Government’s decision here to put the cost of the over-75s on us has been more than matched by the deal coming back for the BBC,’ he said in 2015.
Last night one of those who helped the BBC resist the Government’s proposal in 2010 said Lord Hall accepted the deal too easily.
The source said: ‘They basically traded it for a cost-of-living increase in the licence fee and now they are having to live with the consequences of that.
‘The BBC for a long time had bred a certain cockiness in its director generals, who if they were mere mortals would be a bit more cautious about what they agreed to sign up to.’
BBC insiders said it was ‘rubbish’ that the Treasury had been surprised when Lord Hall accepted the deal. They also denied lobbying ministers to revisit the decision.
A BBC spokesman said: ‘We have set out a range of options in our consultation – each has merits and consequences, with implications for the future of the BBC and for everyone, including older people.’