BBC infrastructure spending criticised by auditors

26 Feb 10
The BBC has come under fire for overspending on new building projects by millions of pounds
By Lucy Phillips

26 February 2010

The BBC has come under fire for overspending on new building projects by millions of pounds.

A damning report by the National Audit Office criticised the publicly funded broadcaster for its management of three major projects, which cost the taxpayer £2bn. The refurbishment of Broadcasting House in central London is £100m over budget and running four years late. It is now due for completion in April 2013. BBC Scotland’s headquarters at Pacific Quay in Glasgow, which opened in 2007, came in £62m over budget and a year behind schedule.

However, next year’s relocation of five departments from London to Salford, costing £887m, is expected to come in £76m under budget.

The report by the public spending watchdog, published on February 25, acknowledged that management of the developments has improved over time, but concluded: ‘The BBC did not set out a clear assessment of the intended benefits for the projects at the outset, meaning it is not well placed to demonstrate value for money.’

Public Accounts Committee chair Edward Leigh said the findings were ‘another example of the BBC Trust’s inability to hold the BBC to account for how it spends our money’. He called for the BBC to be subject to full independent audit by the comptroller and auditor general, not just by its own board of trustees, who replaced a board of governors in 2007. ‘It is unacceptable that the BBC is not subject to the same scrutiny as every other public body in the land. Licence fee payers expect and deserve nothing less,’ he said.

BBC trustee Jeremy Peat admitted ‘serious mistakes’ had been made in the first phase of the projects but said ‘lessons learned’ had been applied to the second. ‘There is still considerable room for improvement, and consequently we will follow up the NAO’s recommendations vigorously and as a matter of urgency,’ he added.  

Amyas Morse, head of the NAO, said in the future the BBC should ensure investment decisions were ‘based on a full assessment of the scope and cost of the project’ and ‘subject to effective challenge by the BBC Trust’.

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