A committee of MPs has criticised the BBC for failing to curb excessive pay and called for a tougher system of governance.

In a wide-ranging report, the Commons culture, media and sport select committee called for greater transparency over pay at the broadcaster, especially in its commercial arm, and for the current system of governance by the BBC Trust to be abolished.

Full public debate over the future of the BBC was imperative, the report said, after a “hasty and secretive” funding settlement agreed last July that saw the BBC take on the cost of providing free TV licences to the over-75s. The cross-party committee, which was until the election chaired by current culture secretary John Whittingdale, who negotiated the behind-closed-doors funding deal, also said that the BBC could have done more to resist the settlement.



The report is critical of the BBC’s failure to act on high pay. Despite a “number of efficiency reviews”, it said “there appears to have been little or no restructuring, and there are still concerns about pay and management levels”.

Conservative MP Jesse Norman, the committee’s chair, said that concerns over pay extended to plans that would see the corporation’s production arm spun off into a standalone production unit, called BBC Studios.

“There is concern about pay levels and transparency in the commercial parts of the BBC, and that is an issue we may be looking at in the future with Studios,” he said.

The report suggests, for the first time publicly, that the white paper on charter renewal is expected to be delayed. “If the timescale slips, the government may well need to look at extending the current charter to allow public and parliamentary consideration,” said the committee chair.

The culture department hoped to publish the white version in the spring, but a combination of 193,000 responses to last year’s green paper – the second highest number to any similar piece of legislation – May local elections and the proposed EU referendum has raised doubts about the ability of the department to publish before the summer.

Other key points from the report include:

The BBC Trust has “lost confidence and credibility and should be abolished”, then be replaced by a unitary board and separate regulator within the existing Ofcom structure.

Extending the current or next charter period from its current 10 years to remove negotiations from the election cycle. Previous royal charters have run for more than 10 years, though not in recent years.

The committee opposed a five-year charter, which it said had no merit.

The BBC’s commercial news operation should be restricted to news gathering and delivery and resist “the temptation to expand into magazine-style content”.

As well as concerns over pay, questions over the BBC Studios plans include: whether they would be vulnerable to challenges under state aid rules; whether BBC commissioners might favour studios over other producers; and whether a more commercial approach might have a negative impact on regional commissioning.

Organisation by BBC executives of the so-called “lobbying letter” signed by stars supporting the corporation was “entirely unacceptable”.



The government should consider setting up an independent public service reporting body to enhance local reporting, especially from courts and councils.

There is a lack of communication between BBC strategists at the top and engineers working on technology projects.

The BBC Trust, set up 10 years ago, has few remaining defenders, but the report is particularly forthright about future options once the current charter period ends in December.

“The problem that the trust was intended to solve – the need for the BBC’s top managers to be appropriately challenged and held to account on behalf of the licence fee payer – remains. Our judgement is that the issue of wider accountability should be the task of a separate section of Ofcom.”

The cross-party group of MPs was also critical of BBC Worldwide, saying that it lacked transparency about its performance and distribution deals, and that it should be subject to a review of its business case to ensure it is delivering both value for money and protecting the BBC’s brand.

Both the BBC Trust and the BBC separately welcomed the report and proposals to create a unitary board and separate regulator. A BBC spokesperson said:“We support the committee’s assertion that the BBC’s independence should be protected by taking the BBC out of the political cycle, and agree with its proposal for an 11- or 12-year charter.

“We also welcome the committee’s support for the BBC’s record on producing distinctive programmes which we know that the public love, and its recognition of the BBC’s value to the UK and around the world.”