BBC Introduces Stricter Reviews of Severance Payments

6:10 AM PST 09/04/2013 by Georg Szalai
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BBC director general Tony Hall

"I want to make sure that the BBC does everything it can to give the public confidence we are managing their money in the right way," says director general Tony Hall.

LONDON – The BBC on Wednesday published two reports into severance pay at the U.K. public broadcaster and unveiled stricter reviews of such payments after criticism that departing executives have at times received more money than contractually promised.

The BBC said that it would start publishing a review of all severance deals made each year as part of its annual report.

BBC director general Tony Hall also named senior independent director Fiona Reynolds as the person in charge of this review.

The broadcaster said the review "will be published for the next two years and has been introduced to ensure the tighter controls the BBC has introduced are being implemented effectively."

Additional new measures include the requirement of detailed business justification reports for each severance deal before its authorization and approval from the BBC's senior manager remuneration committee for any payouts in excess of standard guidelines.

Hall previously introduced a severance pay cap of $235,000 (£150,000).

The National Audit Office, Britain's financial watchdog, earlier this year criticized several cases of excessive severance payments by the BBC. In one of the reports published on Wednesday, the office has now examined 90 additional cases from 2010 to 2012.

The second report was compiled by accounting and consulting firm KPMG for the BBC and looked at severance payments from July of 2006 to Dec. of 2009.

“Reforming severance pay arrangements and addressing these problems of the past have been a priority for me from day one as director general," said Hall. “The [KPMG] report underlines what we already knew. Approvals, record keeping and oversight were poor ... The measures I am announcing today further strengthen the new controls I have already put in place. I want to make sure that the BBC does everything it can to give the public confidence we are managing their money in the right way."

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

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