MPs criticise reckless BBC spending

A cross-party committee of MPs has told the next government to ensure that the BBC is held more accountable for its spending decisions.

A report published today by the Commons public accounts committee accused the corporation of "spending public money without fully analysing costs and benefits".

The MPs also claimed that the BBC has fostered a "culture where ends have overridden means", including the recent £100 million overspend on the redevelopment of BBC Broadcasting House and the high cost of covering music and sporting events.

According to PAC, the BBC Executive has a "reluctance to apply value for money considerations to editorial decisions", but blame also rests with the BBC Trust.

The governing body has only intermittently allowed the National Audit Office to analyse the BBC's accounts, and even then only granted partial access, which the MPs described as "anomalous and untenable".

The Trust has also resisted all demands to publish a detailed individual breakdown of how much the BBC pays its top talent in salaries and bonuses.

"By entering into confidentiality agreements with some presenters the BBC is putting public money beyond the scrutiny of the...auditor general and Parliament," said PAC.

Last month, BBC Trustee Jeremy Peat claimed that the Trust should always retain the final say on who audits the BBC's accounts to maintain editorial independence from government.

However, PAC said: "The BBC's editorial independence...does not absolve it from responsibility to deliver value for money. It beggars belief that the BBC Trust refuses to provide or attaches strings to, information required by the committee to examine the BBC's use of public money.

"The Trust seems to think it is acceptable to negotiate the terms on which it will do business with Parliament. This is unacceptable and a discourtesy to Parliament."

The MPs now want to bring forward the planned review of who audits the BBC's accounts from the current deadline of 2016 in order to put a new framework in place.

"As a matter of principle, the BBC's use of public money should be subject to the same statutory audit of its financial statements and value for money scrutiny...as is the case for other publicly funded organisations," said PAC.

Alongside criticism of BBC spending on buildings, major events and salaries, the PAC report also raised concern about other excesses, such as a technology deal with Siemens which was intended to save £35m a year, but subsequently delivered just £21.8m in annual savings.

In conclusion, the report said: "Across a range of BBC activities we have been concerned that there is a culture which allows commitments to be entered into and extended without sufficient clarity, and robust challenge by BBC management, governors and now the BBC Trust."

PAC chairman Edward Leigh MP added: "The BBC is currently immune from being properly held to account for its spending of billions of pounds of public money. This committee has learned enough to be concerned about the BBC's record of spending public money without fully analysing costs and benefits."

In response to the report, a Trust spokesperson said: "The Trust takes its duty to hold the BBC to account and to ensure value for money for licence fee payers very seriously - that's why we've set challenging targets to release £1.9 billion in savings between 2008/9 and 2012/13.

"We give the NAO full access to the information they need to conduct the value for money studies we commission - they have had full access to all information for the two studies covered by today's report - and we have recently agreed a range of ways to enhance this access further in future.

"However, any arrangement between the BBC and NAO must safeguard the BBC's independence from Parliament and the government of the day, and government-commissioned research shows that the public agrees that the BBC should be independent from government and Parliament."