Running costs of BBC's London headquarters are triple UK average
|
Version 0 of 1. The BBC has been reprimanded in a National Audit Office (NAO) report that reveals that the cost of running its redeveloped New Broadcasting House headquarters is three times higher than the UK average and almost double that of comparable central London buildings. The NAO said the BBC needed to “make better use of space to achieve value for money” after it found that the high-tech building, which opened three years ago, accounts for a third of the corporation’s annual bill for running its UK property portfolio, but houses just over a fifth of its staff. In addition the NAO said the corporation did not meet the target it set in 2008 to cap the cost of running its £839m portfolio of properties at 6% of its licence fee income. It is currently running at 7.3%, although the BBC partly blamed missing the target on 2010’s licence fee freeze, which meant it took on additional obligations such as funding the BBC World Service and BBC Monitoring. NAO head Amyas Morse said: “The BBC has made good progress in upgrading its estate but it will need to press ahead with its plans to make better use of space to achieve value for money. “The BBC will also need to maintain enough flexibility in its leasehold and freehold portfolio to allow its estate to adapt quickly to the changing needs of an organisation operating in a fast-changing sector.” BBC Trust value for money committee chair Nick Prettejohn said: “The BBC has reduced the size of the estate by almost a third while at the same time adding new TV channels and radio stations, and modernising its buildings. These are significant achievements and I am pleased that the NAO have recognised the good progress made. “Today’s report also gives a clear steer on where further improvements can be made and the Trust will continue to track progress to make sure the NAO’s recommendations are implemented in full.” The BBC pointed out that Broadcasting House’s costs are higher than some other buildings because it operates 24 hours a day and needs more security. BBC managing director for finance and operations, Anne Bulford, said: “This report shows that better buildings have made the BBC a better, more efficient, broadcaster which gives licence fee payers more for their money. “The reality is we’re set to save £67m a year by using our properties better. The NAO report makes clear that we are now more efficient and have met our long term aim to upgrade BBC properties without increasing costs. “Had the licence fee not been frozen the proportion of licence fee spent on property would be just over 5% by the end of the charter period, well below the target.” The NAO report also reveals that almost a quarter of the BBC’s property estate is made up of vacant space and “walkways”. The figures show that around 10% of the corporation’s 457,500 sq m estate across the UK is vacant (42,600 sq m) while 53,400 sq m is taken up with “walkways”. In addition, 29,600 sq m are set aside for car parks – around 1,000 m2 more than is used for “edit suites and technical areas” – and nearly 10% (39,300 sq m) is made up of “meeting rooms and informal areas.” The report also gives an insight into the poor state of some BBC buildings. Cardiff Broadcasting House, which is being disposed of, has suffered from flooding and, according to the NAO, “has empty floors that are no longer needed. Between January 2012 and March 2013, the BBC recorded over 858 incidents affecting programme-making. The level of incidents involving programme disruption or loss of output at the site increased by 66%.” It is not the first time the BBC has come under fire over the £1bn redevelopment of Broadcasting House, which it has on a 30-year lease. Five years ago the NAO criticised it, pointing out it took four years longer than planned and cost £55m more than expected. The NAO said if the cost of running New Broadcasting House was stripped out, then “the cost of running the rest of the BBC’s estate is well below external benchmarks. We analysed the impact of removing Broadcasting House from the BBC’s benchmarking data [and] this suggested that the average cost of the remaining buildings was £426 per sq m … 14% below the benchmark.” The auditors’ report also said that within the past 15 years, the BBC took out long leases, which it cannot surrender until the 2020s or 2030s, on properties that it no longer needs, although it could potentially sublet them.” However the BBC was given a pat on the back for cutting the size of its property estate by 29% over the last 15 years, while increasing its broadcasting output, and now has 154 buildings on its books. The changes to the BBC’s properties are part of a wider strategy – first established in 1998 and since partly driven by previous licence fee settlements with the government – designed to save money and move more staff outside London from its old headquarters, Television Centre in west London, to its new northern centre, MediaCity UK in Salford. The BBC management pointed out in their response to the NAO that Television Centre was sold “in a deal worth £200m and generating £30m annual savings. The BBC is also in discussions to sublet three of its buildings in London Media Village. Plans are in place to move BBC Wales to entirely new headquarters, much smaller but much more efficient and fit for purpose. “Whilst there is still work to be done in some buildings, most significantly in Belfast, 62% of our estate is now less than 15 years old, and overall the BBC’s buildings are now fit for purpose: and set in locations which encourage interaction with our audiences and the wider creative community. Also, we met our target to have more than 50% of our staff located outside London one year early.” Figures in the NAO report appear to back up complaints from staff – as depicted in hit BBC2 satire W1A – that they are squeezed into smaller spaces than before, especially in Broadcasting House. Over the five years to 2013 the BBC has reduced the area occupied per person from 14.8m2 in 2008 to 12m2 and plans to reduce it further to “8.3m2 – a target already reached at Broadcasting House”. Overall the NAO made three recommendations to the corporation, which the BBC said it has taken on board. They are: The BBC should assess decisions about individual property projects against a clear target of what it wants its overall estate cost to be; When considering the financial benefits of taking long leases on buildings, the BBC should also evaluate the potential impact on its ability to respond to changing needs; The BBC needs better information on how its use of space is changing in response to changing business pressure. • To contact the MediaGuardian news desk email media@theguardian.com or phone 020 3353 3857. For all other inquiries please call the main Guardian switchboard on 020 3353 2000. If you are writing a comment for publication, please mark clearly “for publication”. • To get the latest media news to your desktop or mobile, follow MediaGuardian on Twitter and Facebook. |