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BBC chiefs' bonuses are suspended BBC chiefs' bonuses are suspended
(30 minutes later)
Bonuses for the 10 most senior BBC executives are to be suspended indefinitely, the chairman of the BBC Trust has announced.Bonuses for the 10 most senior BBC executives are to be suspended indefinitely, the chairman of the BBC Trust has announced.
Sir Michael Lyons said their pay was still regarded as "generous" despite a 7% fall and a review was under way. Sir Michael Lyons said their pay was still regarded as "generous" despite a 7% fall, and a review was under way.
As the BBC's annual report was unveiled, Sir Michael also responded to criticism from culture secretary Ben Bradshaw about sharing the licence fee.As the BBC's annual report was unveiled, Sir Michael also responded to criticism from culture secretary Ben Bradshaw about sharing the licence fee.
Sir Michael maintained plans were "a threat to the independence of the BBC".Sir Michael maintained plans were "a threat to the independence of the BBC".
I can clearly understand why hard-pressed licence fee payers may feel that the pay of some top executives and staff is generous Sir Michael LyonsBBC Trust chairman Mark Thompson on the decision to suspend bonuses for executives
The total pay of the BBC's 10 executive directors fell from £4.96m in 2007/2008 to £4.6m in 2008/2009.The total pay of the BBC's 10 executive directors fell from £4.96m in 2007/2008 to £4.6m in 2008/2009.
The falls were largely because no bonuses were taken last year. The falls hide a 2% pay rise, largely because no bonuses were taken last year.
Now, any bonus payments for executive directors will be "suspended until further notice and not reintroduced without the trust's approval". Now, any bonus payments for executive directors have been "suspended until further notice and not reintroduced without the trust's approval".
That move forms part of a review of executive pay - revealed by Sir Michael on Tuesday - which began in February.That move forms part of a review of executive pay - revealed by Sir Michael on Tuesday - which began in February.
"There has been considerable disquiet in recent weeks about the salaries of top BBC staff," he said. "There has been considerable disquiet in recent weeks about the salaries of top BBC staff," he said, referring to the disclosure of executive pay packets last month, which revealed that 27 senior staff earned more than £195,000 last year.
BBC ANNUAL REPORT class="" href="http://news.bbc.co.uk/1/shared/bsp/hi/pdfs/14_07_09_bbc_trust_2008_09.pdf">Part One: BBC Trust's review and assessment for 2008/2009 [2.2MB] class="" href="http://news.bbc.co.uk/1/shared/bsp/hi/pdfs/14_07_09_bbc_executive_2008_09.pdf">Part Two: BBC Executive's review and assessment for 2008/2009 [5.6MB] Most computers will open this document automatically, but you may need Adobe Reader href="http://www.adobe.com/products/acrobat/readstep2.html">Download the reader here "I can clearly understand why hard-pressed licence fee payers may feel that the pay of some top executives and staff is generous."
"And I can clearly understand why hard-pressed licence fee payers may feel that the pay of some top executives and staff is generous." The review would balance the need "to pay enough to get the best people" with "the BBC's own financial challenges," Sir Michael added.
The review would balance the need "to pay enough to get the best people" with "the BBC's own financial challenges".
Those challenges to funding include government proposals to allocate 3.5% of the licence fee to other broadcasters, including ITV, to fund the provision of regional news and children's programming.Those challenges to funding include government proposals to allocate 3.5% of the licence fee to other broadcasters, including ITV, to fund the provision of regional news and children's programming.
Speaking to the Financial Times, Mr Bradshaw said it was "self-defeating" of BBC managers to oppose the plans.Speaking to the Financial Times, Mr Bradshaw said it was "self-defeating" of BBC managers to oppose the plans.
BBC EXECUTIVE SALARIES 2008/9 Mark Thompson - Director General £834,000Jana Bennett - Director, Vision £515,000Mark Byford - Deputy Director General £485,000John Smith - Director, BBC Worldwide £480,000Zarin Patel - Chief financial officer £429,000 Source: BBC annual report 2008/9
They had lost the confidence of many of their senior staff over the issue, he added.They had lost the confidence of many of their senior staff over the issue, he added.
BBC ANNUAL REPORT Part One: BBC Trust's review and assessment for 2008/2009 [2.2MB] Part Two: BBC Executive's review and assessment for 2008/2009 [5.6MB] Most computers will open this document automatically, but you may need Adobe Reader Download the reader here
"There is almost a feeling of despair among a lot of highly-respected BBC professionals," he said."There is almost a feeling of despair among a lot of highly-respected BBC professionals," he said.
"I don't know why they have adopted this position. I don't think it's sensible. I think it is wrong-headed and ultimately self-defeating.""I don't know why they have adopted this position. I don't think it's sensible. I think it is wrong-headed and ultimately self-defeating."
But Sir Michael told Tuesday's press conference it was "indeed surprising that a secretary of state who has just started a public consultation exercise should give the impression that he has already made his mind up so firmly". But Sir Michael told Tuesday's press conference it was "surprising that a secretary of state who has just started a public consultation exercise should give the impression that he has already made his mind up so firmly".
WHAT A MONTH'S LICENCE FEE PAYS FOR Television - £8Radio - £2.01Online - £0.61Digital switchover and other costs - £1.01 Based on a month's cost of a TV licence fee at £11.63
He added: "You run the risk of the licence fee becoming a back pocket for government, used to fund an increasing range of activities with damage to accountability, eventually the independence of the BBC, and run the risk of a higher licence fee in the future."He added: "You run the risk of the licence fee becoming a back pocket for government, used to fund an increasing range of activities with damage to accountability, eventually the independence of the BBC, and run the risk of a higher licence fee in the future."
Mr Thompson said there was "no disunity" over the issue.Mr Thompson said there was "no disunity" over the issue.
Resistance to such "top-slicing" was "incredibly strong across the organisation", he added.Resistance to such "top-slicing" was "incredibly strong across the organisation", he added.
BBC EXECUTIVE SALARIES 2008/9 Mark Thompson - Director General £834,000Jana Bennett - Director, Vision £515,000Mark Byford - Deputy Director General £485,000John Smith - Director, BBC Worldwide £480,000Zarin Patel - Chief financial officer £429,000 Source: BBC annual report 2008/9
The annual report revealed that Mr Thompson was the only executive director whose total pay went up - by 2% from £816,000 to £834,000 in 2008/2009.
But he said that was because he was the only one not to have taken a bonus in 2007/2008.
The pay of Sir Michael also increased from £163,000 in 2007/2008 to £213,000 last year.
But Sir Michael said he had only taken up his position in May 2007 - so his fees for the 2007/08 did not cover the full year.
The job had become more time consuming in 2008/2009, he added.
The BBC Trust publication gives licence fee payers a chance to examine the corporation's activities.The BBC Trust publication gives licence fee payers a chance to examine the corporation's activities.