Last updated: July 16, 2013 10:39 pm

Lord Patten to quit as BBC chairman when term finishes in 2015

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Lord Chris Patten arrives to speak to journalists outside New Broadcasting House©AFP

Lord Patten, chairman of the BBC Trust, has become embroiled in a row over executive pay-offs

Lord Patten will not be seeking another term as head of the BBC’s governing body, the peer said on Tuesday, after admitting the past year had seen some of “the darkest days” in the broadcaster’s recent history.

The chairman of the BBC Trust, whose term runs until 2015, has been under pressure since the Jimmy Savile sex scandal raised questions over governance and editorial practice at the public-funded corporation.

Revelations over high severance payments to departing executives has further increased scrutiny of the trust’s oversight of management.

Speaking after publication of the annual report, Lord Patten acknowledged there was a “dilemma” over the trust’s ability to police the broadcaster.

“The trust has the responsibility of getting the best deal for licence-fee payers,” he said. “But it is kept in its box on operational issues and the detailed management of money by the charter.”

His comments will heighten debate over the best regulatory structure for the BBC as discussions loom over the renewal of its royal charter, which determines its remit and governance.

The BBC’s annual report revealed it spent almost £5m on Savile-related inquiries, highlighting the financial – and reputational – cost of the scandal, involving child abuse allegations against a former star presenter.

The report also showed the pay bill for executive directors in the year to the end of March swelled 60 per cent to £4.13m, when taking into account pay-offs to executives such as the former director-general George Entwistle, who resigned in the wake of the Savile scandal. Ignoring these one-off costs, however, like-for-like pay was down 8 per cent.

At a parliamentary public accounts committee hearing last week, Margaret Hodge, its chairman, said the trust should have had greater knowledge of the severance pay-offs.

Further questions have been raised over the BBC’s use of public money after its recent scrapping of a technology project – known as the digital media initiative – at a cost of almost £100m.

Even some supporters of Lord Patten are now pushing for a regulatory revamp. Sir Christopher Bland, BBC chairman from 1996 to 2001, believes Lord Patten receives unfair criticism, but argued that the broadcaster’s governance needs reform.

“The time has come for the BBC to have a more conventional board where a regulatory function is either by a BBC specific trust – whose object is to review its performance and not its operations – or alternatively hand it over to Ofcom [the media regulator],” he said.

Sir Roger Jones, another former BBC governor, said Lord Patten had accepted “an impossible job” and that he should step down.

In the year to the end of March, the BBC received licence fee income of almost £3.7bn – up 1.4 per cent – on the back of an increased number of UK households. It generated a group surplus of £328m, helped by disposals such as Lonely Planet, the publisher, and saved £580m through efficiency savings.

BBC Worldwide, the broadcaster’s commercial arm, achieved headline profit of £156m, up 1 per cent on the previous year. Profit before tax, excluding gains and losses on disposals, were £125m, a like-for-like increase of 21 per cent, helped by shows such as Africa and Top Gear USA.

 

Corporation’s highs and lows

 

FAILURES
Savile scandal The BBC’s poor handling of the Jimmy Savile crisis has inflicted untold reputational damage on the broadcaster. Its annual report revealed there has been a financial cost too with £4.9m spent to date on Savile related inquiries

Severance payouts The BBC paid out £25m in severance payments to 150 senior managers in the three years to December 2012, breaching its own guidelines and putting “public trust at risk”, a recent National Audit Office report found

Digital media initiative In May the BBC axed a five-year technology project to give employees access to its entire archive of content, writing off almost £100m spent on it so far, reigniting concerns over how it allocates its resources

SUCCESSES

Olympics The BBC won widespread acclaim for its coverage of the Olympics with many dubbing it the first “digital Games”. Sixty per cent of the audience agreed that BBC digital media coverage had improved their experience

Continuous Improvement Programme The BBC’s five-year efficiency programme achieved savings of 3.7 per cent annually against targets of 3.0 per cent, allowing £580m to be invested this year in content and infrastructure

Audience reach Audience appreciation of BBC TV continues to climb hitting 83.1 this year, up from 81.6 in 2010/11. International reach is also growing: Doctor Who is viewed in 200 territories and the BBC now reaches 406m homes

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