BBC Trust Approves 2009/10 Budget

March 20, 2009 World Screen

LONDON: BBC Trust has signed off on the pubcaster’s budget for the 2009/10 period, which includes an increase in spending on its online offerings, while cutting expenditure on traditional linear TV and radio.

In announcing the new budget, the Trust said it was "mindful that the BBC faces new pressures because of the recession but also has a vital role to play in supporting other parts of the industry through a range of partnership initiatives and by commissioning independent productions. In the current economic climate, it is more important than ever that the BBC does not push up costs for other broadcasters."

The budget takes into account the broadcaster’s planned efficiency savings, which have been targeted at £1.9 billion over five years to 2012/13, plus additional savings triggered by the downturn. This will include a freeze in senior management pay this year with no more than "modest" pay increases for other staff. Further, no bonuses will be paid to BBC public-service staff.

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The cuts include a reduction in the amount spent on top talent. It also increased the online budget by £30.7 million, falling short of the £52.7 million requested by BBC management.

In a keynote speech at the Changing Media Summit in London, the BBC’s director general, Mark Thompson, addressed the financial challenges faced by the organization. He noted the 7,200 jobs already cut in the last few years, with another 1,200 still to follow. Since 2005, the BBC has achieved £524 million in savings, which has been reinvested in content, new digital services and the digital transition. And there are more cuts to come. "In TV, for instance, we are targeting a 5 percent net reduction in program prices each year for the next five years—a cumulative saving of more than 20 percent."  

The budget put forward to the Trust, Thompson said, "includes a further £400 million of painful cuts and reductions in expenditure from freezing senior manager pay and withdrawing discretionary bonuses to the amount we pay top talent."