Police may be called in to investigate BBC pay-offs
The Unhived Mind [UHM]
Police could be called in to probe BBC pay-offs: MP raises prospect of criminal inquiry after Corporation broke its own rules
National Audit Office revealed BBC broke its own rules with big payouts
Tory MP Rob Wilson asks watchdog if criminal activity took place
One in four staff received more than their contracts required
George Entwistle received £475,000 after 54 days as Director General
By MATT CHORLEY, MAILONLINE POLITICAL EDITOR
PUBLISHED: 16:40, 2 July 2013 | UPDATED: 16:41, 2 July 2013
The police could be called in to investigate whether criminal activity took place when the BBC broke its own rules to hand over huge pay-offs to outgoing managers.
The National Audit Office has been asked if fraud, misuse of public funds or other law breaking occurred after the Corporation splashed out £25million on severance payments for just 150 high-ranking staff.
The extraordinary arrangements at the BBC saw hundreds of thousands of pounds dished out to departing staff, with one in four receiving more money than their contracts demanded.
The move cost licence-payers more than £1 million. In two cases the BBC knew that the outgoing staff had already found new employment before they had left.
It included George Entwistle who received £475,000 – twice the money to which he was entitled after resigning as BBC director-general over the Jimmy Savile scandal after only 54 days in the job.
Amyas Morse, head of the NAO, said: ‘The BBC has too often breached its own already generous policies on severance payments’
Today Tory MP Rob Wilson said he would call in the police if the the NAO thought the law had been broken.
In a letter to the NAO, Mr Wilson wrote: ‘In the event that you consider it is possible that criminal offences may have taken place, I would be grateful if you would inform me whether, in your opinion, the evidence is sufficient to warrant a wider investigation as to the possibility of fraud, collusion in fraud, misuse of public funds, or other wrongdoing in relation to severance payments at the BBC in recent years.
‘Having studied the report overnight, I do think there are individual cases that require further explanation and examination.
‘I have therefore written to the NAO today asking whether it has further information it can share about the process by which pay-offs were made and whether any element of fraud or other criminal wrongdoing associated.
‘Based on the reply I receive, I will consider whether there are grounds to refer this matter to the police.’
The NAO report published yesterday revealed that Mr Entwistle’s final pay-off of £475,000 had also included a further three weeks’ salary after the date of his resignation. His payment had previously been reported to be £450,000.
Former chief operating officer Caroline Thomson last year left with a £670,000 pay-off – more than twice her £330,000 salary.
The NAO said that the decisions to make payments higher than staff were entitled had until recently ‘been subject to insufficient challenge and oversight’.
In its conclusions, the NAO says: ‘The BBC has breached its own policies on severance too often without good reason.
‘This has resulted in payments that have not served the best interests of licence fee-payers. Weak governance arrangements have led to payments that exceeded contractual entitlements and put public trust at risk.
‘The severance payments for senior BBC managers have, therefore, provided poor value for money for licence fee-payers.’
Culture Secretary Maria Miller said the report had revealed ‘a culture of pay-offs that simply cannot be justified’.
The BBC’s new director-general, Tony Hall, said the BBC had ‘lost its way on payments in recent years’ and he has already announced moves to cap payments at £150,000 and improve the process.
He accepted the NAO’s conclusions and added: ‘The level of some of these payments was wrong.’
THE BBC BOSS WHO GAVE HIS PAY-OFF BACK ‘OUT OF PRINCIPLE’
Former BBC2 controller Roly Keating who gave his pay-off back
The BBC’s incompetent use of public money was revealed after it emerged one ex-boss had given his vast pay-off back ‘out of principle’.
Roly Keating was handed £375,000 to leave as director of archive content, despite his post not being made redundant and him having another job to go to.
He was awarded a ‘termination payment’ of £250,000 and six months’ pay in lieu of notice of £125,000.
Mr Keating’s new role at the library has a salary in the £140,000 to £145,000 bracket.
He told BBC chiefs he was considering a new job as chief executive at the British Library, a post he now holds with a salary of around £140,000.
But after learning the decision to award the money was described as ‘seriously deficient’ by the National Audit Office, he has returned the money.
Mr Keating wrote a letter to director-general Tony Hall and enclosed a cheque saying he wanted to give it back ‘as a matter of principle’.
The BBC agreed to pay the money ‘on the grounds that it believed the individual would not otherwise have accepted the job offer, which had a lower salary’, according to today’s report.
In his letter Mr Keating said of the compromise agreement: ‘I entered into and signed this agreement in the belief that the BBC had proposed it in good faith and for good reasons, and that it had been properly sanctioned and authorised.’
But he claimed the payouts were made in a rush to cut staffing numbers, which resulted in 445 well-paid mangers still on the payroll.
Mr Hall said: ‘It is important to understand what was happening here. The BBC was trying to get its senior management headcount down, and it succeeded, reducing it from 640 to 445.
‘As the NAO acknowledges, we have saved £10 million over the period studied by the report and will keep on making savings every year.
‘But we have to accept that we achieved our objectives in the wrong way. I believe the BBC lost its way on payments in recent years. ‘
A total of 228 senior managers left the corporation in the three years up to December 2012.
Of those 150 of received severance payments, each receiving an average of £164,200.
And there were still 436 senior managers continuing to work at the BBC in February.
The BBC has estimated it has made £35 million in savings as a result of senior manager redundancies – £10 million more than the £25 million it has paid out – and these will increase over time.
In total Mr Entwistle received more than £800,000 in ‘remuneration’ during his final year at the corporation.
Figures published today show that when his salary, ‘compensation’ pay-off and the costs to the BBC for his legal fees are totted up, the total sum comes to £802,000.
The costs include a six-figure sum related to his appearance as a witness before the Pollard Review, which looked into a shelved Newsnight investigation into the Jimmy Savile sex abuse scandal and its knock-on effect at the BBC.
Mr Entwistle’s legal fees and associated costs – including tax and VAT payments – for appearing before the Pollard inquiry came to £107,000.
He had been in charge of the BBC’s TV output at the time of the shelved report into Savile, and the erupting scandal went on to end his tenure as director-general after less than two months.
He was given £450,000 as a severance payment when he resigned and a further £20,000 for legal fees, private medical insurance and PR support.
And he collected £217,000 in salary for his time as boss of BBC Vision and as director-general during his final months at the corporation.
His predecessor in the top job, Mark Thompson, also ran up hefty legal costs for appearing before the Pollard Review, with the BBC paying £86,000 to cover them, the figures showed today.
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