BBC: Flexibility, Cost Cutting, and Transparent Salaries
Following on the heels of the MP expenses scandal, the issue of expenses at another public body, the BBC, has recently been in the news. I was hired by the BBC for some particular tasks. Then their major issue was cutting their costs, and the issue continues to remain unaddressed today. Well, not entirely unaddressed—a number of directors general have tried to reduce the cost base of the BBC over the years, and the message from within the BBC is that costs have partly been reduced, but there are a lot more still to take out.
In the press, current director general Mark Thompson has defended his ‘high for a public servant’ salary as entirely justified as it’s only one third of what a private sector executive in his position would get. I’m not sure if this is a fair position, but I do know that at the BBC, their real costs are in infrastructure that is sometimes redundant, not in peoples’ salaries alone. The real question to ask about the BBC is if the cost challenges they face are due to there being too many departments or too many people in the same role doing the same job, not whether their top executives are being paid too much.
For example, when I was brought in there, they used to have an internal chauffeur service to take guests to and from their studios. This internal service worked to rule, and didn’t like to work to the flexibility often required in scheduling broadcast television and radio (so I was told). So rather than face the uncomfortable situation of having a fight with the service, I was informed that programming executives and line managers avoided using the internal function and would call outside chauffeurs to bring guests in and out. Thus the BBC was paying for the internal function they didn’t use and for an external function they shouldn’t have needed. Certainly making the internal function more flexible (or removing it all together) would be the type of cost that the BBC needs to cut.
In the Telegraph article, Thompson also mentions how greater transparency in BBC salaries could be detrimental to its ability to recruit and retain top talent. Is greater transparency in salaries a good thing or bad thing? I think that when there is a direct link between salary and reward—such as for a CEO who has to meet shareholder expectations—then transparency in salaries is a good thing. But for team members who are just doing a job that based on skills and expertise, then salary information should be confidential. But what Thompson brings up isn’t the real issue at hand; the BBC’s real issue is the hidden costs in its structure that have traditionally been very difficult to dig out.
