BBC bonuses culled amid profit slide
THE BBC’s commercial arm reported a 27 per cent drop in full-year profit yesterday, as the broadcaster said it had suspended all executive director bonuses until further notice.
BBC Worldwide said pre-tax profit slid to £85.7m in the year ending March 2009, despite revenue hitting £1bn for the first time.
The company blamed the drop on one-off costs relating to the collapse of Woolworths – with which it had a joint distributing arm – and the blocking by the Competition Commission of Kangaroo, its planned online video joint venture with ITV and Channel 4.
The BBC – which came under fire last month when it revealed that 27 senior staff earned nearly £200,000 per year – said bonuses for its top ten executives would not be reintroduced without the approval of the BBC Trust.
But BBC Trust chairman Sir Michael Lyons said that the pay review will have to balance the need to retain top executives, whilst meeting the BBC’s “financial challenges”.
The annual report revealed that BBC director general Mark Thompson was paid £834,000 in the year ending March 2009, while chief financial officer Zarin Patel earned £429,000.
The BBC also reiterated its opposition to “top-slicing” the licence fee to fund public broadcasting initiatives, such as local news production for other channels, as proposed in the government’s Digital Britain report last month.
Earlier yesterday, the new culture secretary Ben Bradshaw launched a fresh attack on Lyons and Thompson, saying that their resistance to sharing some of the £3.6bn license fee with rival broadcasters was “self-defeating” and “wrong-headed”.