BBC brings in KPMG auditors for second severance pay probe

The BBC has brought in an external audit firm to search for excessive severance payouts to top executives at the corporation.

KPMG has been hired to look at severance pay “cases in recent years where guidelines may have been breached”.

The news comes after the National Audit Office last month revealed that £25m had been paid in redundancy packages for senior executives over three years.

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In a report, the Government’s spending watchdog said the size of the payouts was “deeply worrying” and warned that the corporation had breached its guidelines “too often and without good reason”.

In an email to staff last week, seen by Press Gazette, director general Tony Hall said the BBC was “determined to learn the lessons from what went wrong”.

The KPMG probe is in addition to a continuing NAO investigation into severance pay for the three years to 2012. The results of both reviews will be revealed to the Commons’ Public Accounts Committee, Hall told staff.

He said he understood why “this issue has provoked a very strong reaction from many of you”.

He also confirmed that the corporation would be introducing a £150,000 cap on severance pay from next month.

In his email, Hall continued:

But we are also determined to learn the lessons from what went wrong. There has already been a National Audit Office report, which found poor practices though not any evidence of criminal wrong doing and in spite of recent newspaper reports, to date we have not had any approaches from the police on this matter either.   The NAO is now back at the BBC looking at the outstanding severance payments made during the three year period to the end of 2012. In addition, we have asked our auditors KPMG to review other cases in recent years where guidelines may have been breached. Their reports will be published and shared with bodies like the Parliamentary Public Accounts Committee next month.

I know this issue has provoked a very strong reaction from many of you and I understand why you feel that way.  I have already said I believe we lost our way on this issue. It is worth saying however that severance pay in general was part of an attempt to reduce senior management numbers, and in the process we did save £35m which went back into programme-making and will continue to do so at a rate of £19m a year as we move forwards. However, it is clear this was not done in accordance with best practice – that is why we have already tightened up procedures and also why we will not contemplate this level of pay-off in the future, even though senior posts will continue to decline in number."

Recent high profile payouts at the BBC include £475,000 to former Director General George Entwistle after he resigned in November 2012 after 54 days in the job and £670,000 to former chief operating officer Caroline Thomson in September 2012. In 2010, Mark Byford pocketed £949,000 after standing down as deputy director general and head of news.



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