LONDON: Former BBC Director General Mark Thompson, now chief executive of the New York Times Company, yesterday defended large severance payments to senior BBC bosses that he said had ultimately helped the publicly funded broadcaster cut costs.
British lawmakers are trying to understand why Thompson sanctioned payments of at least £1.4m ($2.19m) beyond contractual obligations to senior BBC managers during the last three years of his 2004-2012 watch.
“I do not think we lost the plot,” Thompson said when asked by the chairwoman of parliament’s Public Accounts Committee, Margaret Hodge, about what she called “grossly excessive severance payments”. The payments, he said, represented value for money.
Thompson said severance payments to senior managers — which cost the BBC £25m from 2009 to 2012 — ultimately helped him reduce costs by at least £35m.
“In 2010, I believed ... that we had to do something very significant and very rapidly to reduce the numbers and also the aggregate pay of senior managers at the BBC,” said Thompson, who quit the BBC last year to join the New York Times Company as chief executive officer and president.
Chairwoman Hodge said she cherished the BBC as a broadcaster but its management had dismayed the British licence fee payer — who has to pay £145.50 a year if they use a colour television — by making such large severance payments. “The current arrangements under which the BBC operates are bewildering. They are complex and they are confusing and they do very little to help the licence fee payer understand who they can hold to account,” Hodge said.
The severance payment row comes after a tumultuous year for the BBC during which Thompson’s successor, George Entwistle, resigned in July 2012 to take responsibility for a BBC news report which falsely accused a former politician of child abuse.
Thompson, a 56-year-old Oxford graduate, was grilled by lawmakers over £949,000 worth of payments to his deputy, Mark Byford, who left the BBC in 2011 with what the National Audit Office said was the largest BBC severance payment. Byford received a £474,500 redundancy payment and £474,500 in pay in lieu of notice. Byford, who had 31 years of service, could not be immediately reached for comment.
“An ordinary worker on average earnings would have to work 40 years to earn the million pounds which Byford got as his redundancy pay — in those circumstances you can understand the sort of disgust ordinary licence fee payers feel about their contribution being used in this way,” Hodge said.