£1.1m for BBC chiefs as ratings slump

Danielle Demetriou12 April 2012

BBC bosses came under fire today for receiving more than £1.1 million in bonuses and perks while viewing figures hit a record low.

BBC director-general Greg Dyke has built a reputation for his outspoken attempts to cut costs at the Corporation, from croissants to taxi fares.

However, he was criticised today for failing to exercise the same prudence in the boardroom, according to figures unveiled in the governors' annual report. At the same time ratings for BBC1 reached an all-time low, with its share of viewers falling from 26.8 per cent to 26.5 per cent.

In a further criticism MPs have also condemned a massive 40 per cent increase in expenditure on new services, most of which concern its digital investment.

The report revealed how the licence payer has funded payouts for senior executives that have risen by 25 per cent in the past year - 10 times the rate of inflation. Twenty-one executives, who were understood to qualify by meeting targets to cut running costs, were awarded more than £1.17 million worth of bonuses and other benefits.

The largest windfall was received by Mr Dyke, who took home a bonus of £97,000 on top of his £357,000 salary.

World Service director Mark Byford, who was in charge of the BBC when the Queen Mother died, has been rewarded with a £17,000 pay rise and a £69,000 bonus, bringing his income to £295,000.

Director of drama, entertainment and children's TV, Alan Yentob, took home £302,000, including his £58,000 bonus. Peter Salmon, head of sport, earned £273,000, including £74,000 worth of bonuses and benefits.

The massive payouts were awarded despite fears raised in the report by governors that the Corporation was failing to reach its full potential.

Chairman Gavyn Davies admitted that the BBC needed to do "even better on a more consistent basis" particularly in the fields of arts and politics.

Further criticism was aimed at the BBC's sharp increase in expenditure on new services. Its spending on digital services rose last year to £278 million, marking an increase of more than 40 per cent compared with the previous year.

At a time when many companies are cutting back on internet services, the BBC's online investment nearly doubled, rising from £52 million to £100 million. Gerald Kaufman, chairman of the Commons culture, media and sports select committee, which will sit today, has condemned the use of licence fee income to challenge commercial rivals, particularly on digital channels with relatively small audiences.

Conservative MP Julie Kirkbridge, who sits on the select committee, said: "This is an astonishingly large figure to spend on channels which are hardly watched at all. If the BBC is going to continue to increase spending on digital, we are going to have to see a real increase in the number of its digital viewers."

Meanwhile, the Corporation's commercial arm, BBC Worldwide, has suffered a massive slowdown in growth, despite hits such as Tweenies and The Weakest Link.

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