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MPs call for BBC overhaul amid controversy over severance packages

Tony Hall, right, director general of the BBC, and the BBC Trust Chairman, Chris Patten, attend a news conference at New Broadcasting House in central London, November 22, 2012.

SUZANNE PLUNKETT/REUTERS

When BBC employees arrived at work Monday, they got a note from director general Tony Hall telling them it would be a difficult day for the public broadcaster.

He was right.

Throughout the afternoon, a group of MPs on the House of Commons Public Accounts Committee grilled seven current and former BBC executives about a series of controversial severance payments that had been made to dozens of senior managers who were let go between 2005 and 2013 as part of a cost-cutting exercise. The MPs wanted to know how the payments had been authorized and why so many exceeded the terms of employment contracts, such as the $1.6-million paid to one executive, which was roughly twice the legal requirement.

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The severance was "disgusting" and "grossly excessive," said Labour MP Margaret Hodge the committee chair. She pushed harder, calling the witnesses incompetent and telling them at one point: "I'm not having any more lies this afternoon." And that was just the start.

"Pretty much every time we scratch the surface [of the BBC] something pretty horrible appears," said another committee member, Conservative MP Chris Heaton-Harris.

Much of the attention was on Mark Thompson, who was the BBC's director general from 2004 to 2012 and is now chief executive of the New York Times Company. Mr. Thompson defended the payments, saying he was under "ferocious pressure" to make dramatic cuts to the BBC's budget and staff. During his time, the BBC axed more than 400 managers, about 25 per cent of its senior ranks. In order to do that, Mr. Thompson said he had to make judgment calls about paying large severance packages to ensure the process went smoothly. And he said that over all, the BBC saved far more than it spent letting people go.

Mr. Thompson insisted he didn't act alone and that he sought advice and approval from the BBC Trust, a 12-member board appointed by the government that oversees the corporation. He also attacked Trust chairman Chris Patten, a member of the House of Lords, for claiming the Trust had not been told. Those comments were "damaging and untrue," he told the committee.

Lord Patten, who also testified, stood by his remarks and insisted he was not given details. Former Trust chairman Sir Michael Lyons also said he had not received all the details.

The committee heard from the other witnesses, including the former head of human resources and some Trust members, about fierce battles with Mr. Thompson regarding the cuts. They also squabbled during the hearing about the narrow role of the Trust, how a date on a key letter had been changed at a critical moment and why no one could find another important document because it had been filed under a code name.

By the end of the hearing, most of the MPs were exasperated and many were calling for an overhaul of how the BBC is managed. "At best what we've seen is incompetence, a lack of central control and a failure to communicate for an organization whose business is communication," said Ms. Hodge. "And at worst we may have seen people covering their backs by being less than open."

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About the Author
European Correspondent

Paul Waldie has been an award-winning journalist with The Globe and Mail for more than 10 years. He has won three National Newspaper Awards for business coverage and been nominated for a Michener Award for meritorious public service journalism. He has also won a Sports Media Canada award for sports writing and authored a best-selling biography of the McCain family. More

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