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BBC chiefs' bonuses are suspended BBC chiefs' bonuses are suspended
(41 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 chairmanI 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
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 were 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 will be "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.
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
"And 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".The review would balance the need "to pay enough to get the best people" with "the BBC's own financial challenges".
'Wage restraint' 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.
Mr Bradshaw has said it is "self-defeating" of BBC managers to oppose plans to share the licence fee with other broadcasters. Speaking to the Financial Times, Mr Bradshaw said it was "self-defeating" of BBC managers to oppose the plans.
BBC EXECUTIVES - 2007/8 BONUSES John Smith - BBC Worldwide £88,000Mark Byford - Deputy Director General £41,000Ashley Highfield - Former head, Future Media & Technology £34,000Stephen Kelly - Director, BBC People £33,000Mark Thompson - Director General - waived bonus Source: BBC Annual Report 2007/8 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 corporation is currently trying to cut its costs and save £1.7bn between now and 2013. They had lost the confidence of many of their senior staff over the issue, he added.
Sir Michael's announcement came after widespread criticism of high salaries and expenses among BBC top brass. "There is almost a feeling of despair among a lot of highly-respected BBC professionals," he said.
Writing in the Daily Telegraph ahead of the report's publication, Sir Michael said the trust had "consistently emphasised the need for wage restraint".
"We have to be sensitive to the prevailing economic wind which currently can make the top BBC salaries appear too high," he added.
Last July, Director General Mark Thompson defended the decision to award pay rises of up to £107,000 each for the BBC's executive directors.
'Feeling of despair'
He did, however, waive his own right to a bonus because of the "scale of disruption and uncertainty" facing his BBC colleagues.
I think it is wrong-headed and ultimately self-defeating Culture Secretary Ben Bradshaw on the BBC's licence fee position
The BBC is also facing new challenges to its funding after the government outlined 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 at Tuesday's press conference, Mr Thompson restated their opposition to the plans.
But speaking to the Financial Times, Mr Bradshaw said BBC managers had lost the confidence of many of their senior staff over the issue.
He said: "There is almost a feeling of despair among a lot of highly respected BBC professionals.
"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".
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."
Mr Thompson said there was "no disunity" over the issue.
Resistance to such "top-slicing" was "incredibly strong across the organisation", 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.