One-in-five management cull promised by Mark Thompson

The BBC “will lose established stars” as it goes through a series of massive cuts, director general Mark Thompson warned last night.

The corporation’s top brass will not be exempt from the axe either with major job losses on the horizon.

Speaking in Edinburgh, Thompson said “top talent” pay will be reduced, adding: “Sometimes we will lose established stars as a result. When we do, we will replace them with new talent”.

He also said the number of senior managers would be reduced by at least a fifth by the end of 2011 and the senior management payroll will fall by at least a quarter.

He said: “If we can go further, we will and we will look for reductions at every level in the organisation up to and including the Executive Board.”

The audience at the James MacTaggart Memorial Lecture were warned to expect “significant movement” on executive pay and told the next round of discussions with the Government about the licence fee “will be a moment for realism”.

A large part of the speech at the Edinburgh International Television Festival was made up of a robust defence of the corporation and broadcasting in general, with Thompson hitting back at what he called “exaggerated claims about waste and inefficiency” aimed at the BBC.

The BBC has come under fire from both inside and outside the corporation in recent years.

It has been widely criticised for the large sums of licence fee money paid to its stars and top managers.

Staff are currently being balloted on whether to take strike action over plans to reform its pension scheme and its rivals accuse it of being overly-powerful.

Last year, News Corporation director James Murdoch used the lecture to deliver a withering attack on the BBC, saying the size of the corporation was a “threat” to independent journalism.

Thompson called for increased collaboration between broadcasters to ensure the future success of the industry.

He said: “I don’t believe that decline – creative, financial, institutional decline, above all, a decline in the quality of British television – is inevitable.”

Thompson warned that every pound taken out of the corporation’s commissioning budget is a pound taken out of the country’s “creative economy”.

In the lecture, called The Battle for Quality, he cited public support for the BBC and referred to the 17 million people who tuned into BBC1 after the general election.

He said: “There is still a very strong instinct in this country to come together through broadcasting to share great national moments”.

Thompson praised Sky’s “technical innovation” and “willingness to take big risks” but said it was time they invested more in “British talent”.

He raised the possibility of making up the shortfall in investment caused by the decline in advertising by introducing retransmission fees he BBC “will lose established stars” as it goes through a series of massive cuts, Director General Mark Thompson warned today.

The corporation’s top brass will not be exempt from the axe either with major job losses on the horizon.

Thompson said Sky was “well on its way to being the most dominant force in broadcast media in this country”, through the power of News Corp in the UK media industry.

“If Sky’s proposal to acquire all of the remaining share in Sky goes through, Sky will not just be Britain’s biggest broadcaster, but a full part of a company which is also dominant in national newspapers as well as (being) one of Britain’s biggest publishers,” he said.

A Sky spokesman said: “There are many legitimate questions over the size, cost and governance of the BBC.

“The corporation would be better advised to address the issues in its own backyard instead of advocating a misconceived intervention in the commercial marketplace.” which would see cable and satellite companies, such as Sky, hand a share of their profits to free-to-air channels like ITV and Channel 4 in return for showing their content.

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