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BBC Boss Calls in Auditor in Review of Excessive Severance Pay Cases

Tony Hall - H 2012
Luke Macgregor/Reuters
BBC director general Tony Hall

Britain's finance watchdog recently found that the U.K. public broadcaster gave former top executives higher payouts than contractually required.

LONDON – BBC director general Tony Hall has brought in auditing firm KPMG to help review cases of severance payments to former top executives that may have exceeded contractual promises.

A recent report by Britain's financial watchdog, the National Audit Office, highlighted cases in which severance payouts went beyond the guarantees of employment contracts. It found several cases, in which such severance payments were approved at high levels, including by former director general Mark Thompson, now CEO of the New York Times Co.

Last week, it emerged that police fraud squad officers here were collecting information to help them decide whether to launch an investigation into possible misconduct in public office and fraud.

“The National Audit Office is now back at the BBC looking at the outstanding severance deals that were done during the three year period to the end of 2012," the BBC said in a statement. "In addition, director general Tony Hall has asked auditors KPMG to review other cases in recent years where BBC guidelines may have been breached. Their reports will be published next month."

The Guardian quoted Hall as saying in an internal memo: "I have already said I believe we lost our way on this issue...to date we have not had any approaches from the police on this matter."

Critics have questioned the roles of Thompson and BBC human resources director Lucy Adams, among others. Executives of the BBC and its governing body, the BBC Trust, last month were grilled and criticized by British parliamentarians about the excessive severance. 

BBC Trust chairman Chris Patten described his reaction to the revelations as one of "shock and dismay." Thompson said he had informed the BBC Trust of proposed severance payouts that went beyond contractual promises. Patten highlighted though that the BBC Trust does not currently have any formal power over severance payouts.

The Guardian said that KPMG was likely to review such severance cases as that of former BBC One controller Peter Fincham, who is now director of television at ITV. Fincham got a $775,000 (£500,000) payoff following his resignation in 2007.

E-mail: Georg.Szalai@THR.com
Twitter: @georgszalai