The NAO report revealed that the BBC made severance payments to two thirds of senior managers who left since April 2005, at a cost of £60 million. In a quarter of cases in a sample reviewed by the NAO, the BBC paid senior managers more salary instead of notice than their contractual entitlement, including two cases where the BBC knew that departing senior managers had secured future employment before they had left. The report concludes that the BBC’s severance terms were more generous than elsewhere in the public sector; that the BBC had no consistent set of principles in its remuneration strategy to apply to severance packages, and that the BBC’s management and regulator. The NAO report found evidence of “unusual payments”.
Rob Wilson, Conservative MP for Reading East said: "This is an absolutely damning report. The BBC has paid £60 million to departing executives in recent years, but remains chronically over-managed with an astonishing 436 “senior” managers. That’s too many to get on the same floor, let alone in the same room. The NAO has revealed that the BBC was over-generous in its 'severance in lieu of notice' arrangements, had no proper principles for applying them, and no proper governance arrangements for checking that licence fee payers’ money was being spent properly. Most shockingly, in a quarter of sampled cases the NAO found that the BBC paid departing executives more than they were entitled to under their contracts, and of particular concern, found evidence of “unusual” payments. Lord Hall’s announcement of a cap on payoffs was welcome, but the BBC says today, months later, that it is “consulting with staff” on this. He must realise that the public will demand nothing less than real action to stop these abuses, not headline-grabbing gimmicks.”
Mr Wilson said further revelations about the payoff to former Director-General George Entwistle raised major questions about the BBC’s governance and regulation.
"We now learn that George Entwistle’s lavish payoff was £25,000 more than previously thought. That is about the average person’s annual income. The NAO wanted to scrutinise the Entwistle payoff on behalf of Parliament and the taxpayer at the time but Lord Patten refused. The BBC Trust’s handling of the Entwistle payoff was secretive, evasive and looks increasingly incompetent. Rather than standing up for licence-fee payers and safeguarding the use of public money, the BBC Trust appears to want to keep the public in the dark and resist outside scrutiny." Change will not happen at the BBC unless it comes from the very top. It is hard to have any confidence that the scandalous misuse of public money by the BBC will end when its governing body is so weak."
Culture Secretary, Maria Miller, has also responded to the NAO's report saying: "Every publicly-funded organisation must be able to justify every penny of taxpayers money they spend, and even more so in these tough economic times. There is huge public interest in the BBC, and the NAO has exposed a culture of pay-offs that simply cannot be justified. The report shines a light on a culture at the BBC where individuals received payments that went beyond the already very generous terms of their contract. I welcome the fact that the BBC is looking at future payments - a move which this report suggests is long overdue."
