BBC Faces U.K. Government Probe of Severance Packages (Report)

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Britain's public spending watchdog will look at rising payouts for top executives after politicians criticized the $725,000 severance for short-lived BBC boss George Entwistle.

The BBC faces a formal political investigation of severance pay packages, which have risen sharply in recent years, the Daily Telegraph reported.

Britain's National Audit Office is expected to look at the payouts at the U.K. public broadcaster in the new year after politicians raised concerns about the controversial severance deal for George Entwistle who left his post as the BBC's top executive this fall after only 54 days. The audit office is the U.K. government's public spending watchdog.

The Telegraph said the National Audit Office review will also examine Entwistle's $725,000 (£450,000) package after he resigned this fall after an incorrect BBC news report suggesting a former politician was involved in a child abuse scandal.

Last week, a parliamentary debate criticized Entwistle's severance pay, twice the amount he was entitled to under his contract. Members of parliament criticized the BBC for its "cavalier" use of the license fees that U.K. taxpayers must pay to help fund the public broadcaster.

Many parliamentarians have called for a formal NAO examination. And Maria Miller, Britain's Culture Secretary, has said the organization has the powers to conduct "a value-for-money review" at least in the case of Entwistle, and possibly beyond.

Information obtained by the Telegraph under Freedom of Information laws also shows that from 2010 to 2011 the cost of payoffs more than doubled to $94 million (£58 million) from £27 million. Payouts for the first half of 2012 put severance pay at $23 million (£14 million).

The newspaper said that almost 200 senior BBC managers have received severance packages of more than $161,000 (£100,000) each over the past three years. And 14 executives have been given payoffs of more than $484,000 (£300,000) each, it said.

The biggest severance package went to Mark Byford, the former director of journalism, who received $1.53 million (£949,000), according to the Telegraph. Caroline Thompson, the former BBC COO who was in the running for the top job this year, got $1.1 million (£670,000) after her departure this fall.
Asked about a BBC severance probe, a National Audit Office spokesman confirmed to the Telegraph that the agency was indeed planning one. “It is our intention that [BBC severance payments] will be in the program" for NAO reviews in 2013.

The paper cited a source close to the BBC Trust, the broadcaster's governing body, as welcoming the probe. The person said it could help inform the personnel decisions of designated BBC boss Tony Hall, who is scheduled to take on his role this spring.

A BBC spokesman said: "Staff who are made redundant receive what they are entitled to in their contract. While redundancies involve costs in the short term, in the long term they represent significant savings. We offer our full co-operation with the National Audit Office."

Twitter: @georgszalai