Review: Auntie Accepts Inadequacy, Disputes Overspend

The BBC says it “accepts” all-out criticism from its regulatory trust, which found overspent by £36 million in 2007/08 and was dogged by ineffective management and editorial oversight. In a statement, Auntie conceded: “Our processes and management controls were not adequate for a pan-BBC service straddling multiple cost centres. This is regrettable and we recognise the need to address this. We are developing plans … additional controls will be quickly implemented.”

But a BBC spokesperson told me the level of overspend was on nothing like the scale suggested by the trust: “The vast bulk of that (increase) is a result of a reclassification of accounting – a true figure of overspend is five percent rather than 48 percent.” He was referring to £13.8 million in costs plus £11.1 million in overheads finance chiefs had omitted from accounts, due to what the trust called “blurred definitions of spend” on technology. Put this way,’s true overspend was just £3.5m million above its upper limit – Auntie simply lost £24.9 million down the back of a sofa. But the trust also said the costs came “primarily from the creation of additional content for”.

The trust’s criticisms came like a lightning rod through BBC online top dogs. Future media and technology director Ashley Highfield is due to leave for Project Kangaroo by the end of June and the process of finding a replacement is “under way” with an advert having already gone out, a spokesman told me. But with the trust now expecting structural changes, the BBC may even have to redefine or put the brakes on the recruitment process. Today’s news will, at the least, prove highly disruptive to the hiring process, and there’s a high likelihood the BBC’s spending will be reigned in to such a degree that makes it unable to execute some online projects.

It’s questionable whether the department Highfield is leaving will even exist in six months’ time. Highfield was been criticised last year over iPlayer, but the trust mentioned neither him nor the VOD service, instead blaming the financial incoherence on the BBC’s 2007 restructure – which split BBC New Media’s once-centralised digital spending across four new divisions, including his. It criticised the financial interplay between each of these, and strongly suggests that structure be flattened out once more.

The BBC said it will discuss restructure plans with the trust “in the coming weeks”.