BBC Chair Announces Senior Management Salary Cuts

LONDON: In a speech yesterday, Sir Michael Lyons, chairman of the BBC, announced that the pubcaster will reveal how much it pays its on-air talent and said that senior management will take a 8.3-percent paycut over the next two years.

"The context in which we are making our decisions about the future direction of the BBC is one of severe economic austerity," Lyons said. "Against this background I want to give a pledge to all license fee payers today that when we come to the next license fee negotiations the Trust will enter those talks representing license fee payers’ interests alone. We will not seek to maximize the BBC’s take from the license fee. We will seek only what is necessary for the BBC to fulfil its public purposes as set out in the Charter."

Lyons also noted that the BBC needs to "scrutinize its budgets" in order to save money, and that it must find ways to be more efficient. "The pressure on efficiencies needs to be rigorous and continuous, so we will therefore ask the National Audit Office if they would be willing to conduct further work for us on the overall efficiency of the whole BBC and whether further changes and improvements are necessary," he said.

He then discussed the issue of transparency in how the BBC uses its budget. Senior managers pay will be revealed, Lyons said, as will the salaries of on-air talent. "We are asking for publication of presenters’ and other top talent pay in the narrower bands recommended by the Culture, Media and Sport Select Committee, including the details of the number of people in each band. This will significantly increase the degree of transparency in this area. The information will be presented in aggregate—that is, anonymously. However, I do believe we should release the names of those who receive the biggest incomes from the BBC."

Lyons added: "You might try to characterize this move as a change of mind. It’s true that we’ve been listening carefully to license fee payers and we believe that this is one of a small number of areas where we need to recapture public confidence. On balance, the BBC should be clearer about who the highest paid individuals are, both on screen and off."

The BBC chair conceded that this will not be a "simple process. Often stars work for independent producers and the terms of trade currently mean we can’t have sight of their fees. Some existing BBC contracts have confidentiality clauses that would prevent immediate publication of salaries. But we are challenging the Director General to work urgently on a plan to deliver greater openness only about those who are at the top end of the talent pay scale. This does not affect most of those people who are on our screens day in, day out, night time, on air. It is only at the very top, where we believe there is continuing public concern and a simple need to be clearer about who is paid the most. It is not even a question of divulging, we believe, individual salaries. The Trust is giving a clear signal that it wants to see a change in this area but equally that it understands that this is a difficult challenge."

Lyons went on to discuss the issue of senior management pay. He noted the decision, in October, to cut the total pay bill for senior BBC management by 25 percent over three years and extend the pay freeze for a further three years. He has now asked BBC Director General Mark Thompson to speed up that 25 percent reduction, which should now be completed in 18 months. "We would expect to have in place by the end of this period a different structure for senior management and pay," he said.

In addition, Thompson and the executive board have volunteered to forego a month’s salary for this year and next, reflecting an 8.3 percent pay cut over two years. The BBC Trust will take the same paycut. "There are clear signs that things are moving in the right direction on the pay agenda," Lyons continue. "As of the end of May, the number of senior managers has been reduced by 24 leading to £7.76 million off the pay bill. And this is alongside a drop in the amount that the BBC pays on air talent."