Top BBC Stars' Pay Rises By More Than 20%

The wage bill for television presenters earning more than £1m went up by 22% last year at the BBC, which paid a total of £5.1m to a handful of stars likely to have included Jeremy Clarkson, Gary Lineker and Graham Norton.

Despite cost cuts set to save a total of £1.5bn by the end of next year, the BBC’s annual report published on Tuesday showed that total talent spend rose 7% to £208m, some 12% of the BBC total expenditure on content.

The seven executive directors of the BBC shared £2.5m for the year, half the total earned by its top tier of on-screen talent. Although the BBC does not break down individual pay, just three or four presenters shared the £5.1m.

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The total number of stars earning between £500,000 and £5m fell from 14 to nine but more of them were shifted out of the lower wage bracket to be paid more than £1m. In the current year, that list is set to include Chris Evans, who signed a three-year deal with the BBC to succeed Clarkson at Top Gear as well as continuing his Radio 2 breakfast show.

Director general Tony Hall announced a further 1,000 job cuts from BBC middle managers two weeks ago in a bid to make savings behind rather than on-screen. However, staff numbers in total rose by 1.7% to 18,974 full-time equivalents in the past year.

Asked why headcount and staffing figures had increased overall, Anne Bulford, the BBC’s finance chief, said the corporation had employed more people to work on digital projects as well as major sporting events such as the World Cup and the Scottish referendum. She also cited a 2% pay settlement for staff, which rose overall by 327 in the year.

The annual report will do little to deter critics of BBC profligacy as yearly costs have continued to rise despite several rounds of cost savings. Last week the BBC agreed to a financial settlement that will see it shoulder the burden of paying for free television licences for the over-75s.

‘Programmes for everyone’

Hall said: “I believe that the BBC should continue to make programmes for all our audiences. Everyone pays for the BBC and it is right that we continue to make programmes for everyone. A BBC that doesn’t inform, educate and entertain is not the BBC the public know and love.”

Agreeing with BBC Trust chair Rona Fairhead that the secret process to agree the licence fee settlement was “not a good one”, Hall went on to reject any attempt to shrink the BBC or sell off its commercial arm, BBC Worldwide.

“This debate is also shaping up to be a clash between two different views of the future. Because there is an alternative view: that prefers a much diminished BBC. It’s a view that is often put forward by people with their own narrow commercial interests or ideological preconceptions.

“I don’t support this view. Nor does the British public. Nor do programme-makers across the creative sector.

“I believe in a BBC for everyone. The BBC is a profoundly democratic force. Universal usage of BBC programmes that inform, educate and entertain is central to our democracy and our shared culture. It is part of what makes Britain, Britain. No other country in the world has anything like it – and the rest of the world envies the UK for having the BBC. And because we all pay, we all pay less: the cost for each one of us falls to the lowest it can be for the best and most universal service.

“Secondly, I believe in protecting our independence ... I have real difficulty with the idea of artificial restrictions on creativity – after all, the last time politicians tried to be creative, we ended up with the Millennium Dome. So it will be hard to support any proposal that stops us finding the next Strictly, the next Bake Off, or – dare I say it – the next Top Gear.”

He went on to stress how important commercial funding was the licence fee paid for less than half the budget of some of our biggest dramas last year.

“The case for the BBC doesn’t rest on ideological arguments, it rests on this – what we do, day in and day out. Great programmes and great services. That’s why people like the BBC. That’s why they enjoy the BBC. That’s why they trust the BBC. That’s why they value it. That’s what they pay us to do.

“Like any big organisation, of course, there are always things we can do better. But, on any measure, this is a world-class organisation, hugely valued by our audiences. And any debate about the BBC must start with that undeniable fact.”

‘Good progress’

Fairhead said: “Over the course of the past year, the BBC has had notable successes on screen and on air, remains as popular as ever with audiences, and made good progress in delivering savings with more in the pipeline.

“As we head into the charter review with much more clarity on the funding than expected, the focus must now be on deciding the shape and role of the BBC for the next generation. The trust will be working tirelessly to ensure that the voice of those who pay the licence fee, the UK public, will have the pivotal voice in that debate.”

Fairhead added that measures should be introduced to prevent a repeat of the “shotgun” licence fee settlement two weeks ago, the second in five years.

“The public need a guarantee from the government that measures will be put in place to protect licence fee funding from being changed without due process,” Fairhead said at the unveiling of the annual report.

Fairhead said the deal, in which the BBC took on the £750m cost of paying for free TV licences for the over-75s, would mean cuts to BBC services.

“The trust is clear there are likely to be scope cuts. It will be for the BBC to propose where those might fall but we want an honest and open debate with the public about the nature of them.”

Fairhead said there needed to be “more formal public and parliamentary scrutiny” of government decisions about the BBC’s funding.

She said the funding settlement “fell well short of what the public had a right to expect. It is the people’s BBC, not the politicians’. The public should have a say in decisions that fundamentally affect the services they receive for their money.”

Fairhead added that there was “no evidence that the public wants less entertainment on the BBC”.

Rising costs

Total operating costs in the year to March 2015 rose by 4% to £4.9m, which was partly due to the cost of showing big sports events such as the Commonwealth Games and Fifa World Cup as well as increasing payouts to on-screen talent and the World Service. Until last year, the latter was paid for by the Foreign Office.

The BBC is expected to save an cumulative total of £1.5bn in the 10 years to 2017. Total staff numbers have fallen slightly from 19,767 in 2010/11. The senior manager wage bill has fallen from £78.5m in 2009 to £52m last year with the number of senior managers falling by just two in the year to 401.

Total support costs for public service broadcasting rose from £331m to £364m and the only component showing a marginal decline was the marketing, audience and communication departments.

After culture secretary John Whittingdale took aim at the BBC’s mainstream entertainment offerings, such as Strictly Come Dancing and The Voice, the annual report flagged up both BBC1 shows as the BBC at its best.

Strictly Come Dancing 2014 Strictly Come Dancing: flagged up in the annual report as the BBC at its best. Photograph: Guy Levy/BBC/PA

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BBC1 and BBC2 reach falls

The total reach of BBC1 and BBC2 fell despite increased budgets. Total content spend on BBC1 was up 8% to £1.1bn, while BBC2 was up just over 1% to £405m. BBC4, likely to be under threat as the result of the next round of cuts, saw its budget cut by 6% to £46m.

The BBC said its overall reach – the proportion of the population using at least one of its services each week – went up from 96% to 97%. But the amount of time people spent using BBC services fell from 18.5 hours to 18.3 hours a week.

BBC1’s reach – the proportion of the population who watches it at least once a week – fell from 74.9% to 73.3%, while BBC2 was down from 50.3% to 47.3%.

There was a dip in audience appreciation for its TV channels for the second year in a row despite high-profile drama successes such as BBC1’s Poldark and Wolf Hall on BBC2.

The BBC’s commercial arm, BBC Worldwide, saw headline profits drop 11.9% to £138.6m following the sale of a 49% stake in BBC America to Mad Men and Breaking Bad broadcaster AMC.

The sale also impacted on revenues, down 3.9% to just over £1bn.

More than half, or 53%, of staff are now working outside London, marking the first time the BBC has achieved its target of employing half its workforce outside the capital.

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