Bloomberg News

BBC Chief’s $730,000 Payoff Unacceptable, Lawmakers Say

December 20, 2012

George Entwistle, who resigned as director general of the British Broadcasting Corp. on Nov. 10 over its coverage of sex-abuse allegations, was given an “unacceptable” payoff, a panel of lawmakers said.

Entwistle was paid 450,000 pounds ($730,000), twice his contracted entitlement, when he quit after a report on BBC 2 television’s “Newsnight” program falsely linked former Conservative Party Treasurer Robert McAlpine to allegations of pedophilia. The House of Commons Public Accounts Committee said in a report published in London today that the payment and attached benefits were excessive.

“Public servants should not be rewarded for failure,” the committee’s chairwoman, opposition Labour Party lawmaker Margaret Hodge, said in an e-mailed statement. “This cavalier use of public money is out of line with public expectations and what is considered acceptable elsewhere in the public sector.”

Entwistle resigned after 54 days in the job and received a year’s salary in compensation as the BBC Trust, the broadcaster’s governing body, sought to avoid a drawn-out legal dispute. Trustees had raised concerns that Entwistle, a former editor of “Newsnight,” had shown “a lack of grip and direction” in his handling of the defamation of McAlpine and the scandal over sex-abuse allegations against a dead BBC presenter, Jimmy Savile.

‘Bit Shabby’

Chris Patten, chairman of the BBC Trust, said Hodge’s committee hadn’t taken into account that fighting an unfair dismissal suit from Entwistle would have cost more. “I do think the treatment we’ve had from them is a bit shabby,” he told BBC Radio 4’s “Today” program. “I don’t think they’ve been fair because they don’t look at our legal arguments at all.”

The BBC said yesterday it will replace the senior “Newsnight” editorial team after they “fell short of what was expected,” first in canceling a probe into the claims against Savile and then over the McAlpine report. The shakeup came after a two-month inquiry, led by a former British Sky Broadcasting Group Plc (BSY) head of news, Nick Pollard, that found problems with the BBC’s “rigid” management structure contributed to a breakdown in decision making.

The broadcaster apologized to McAlpine in court on Dec. 18 and agreed to pay him 185,000 pounds in compensation for the “Newsnight” report.

The former director general also left with 12 months private medical cover, a contribution to his legal fees and “professional communications support” of as much as 10,000 pounds.

Entwistle Defense

The BBC probe “makes it clear I played no part whatever in ‘Newsnight”s decision not to broadcast the original Savile investigation -- just as I was not personally to blame in any way for the journalistic failures on ‘Newsnight’ when it broadcast its erroneous report” about McAlpine, Entwistle said in an e-mailed statement yesterday.

The generosity of the payoff was not an isolated incident, the Public Accounts Committee report said.

“Since 2010, over 4 million pounds in total has been made in severance payments to 10 other departing senior managers,” Hodge said. “The BBC is also providing 422 senior managers with private medical cover as part of their remuneration packages.”

The BBC should have allowed immediate examination of the payoff by the independent National Audit Office and its head, Amyas Morse, the committee said.

“By choosing to defer an audit examination of the severance package by the comptroller and auditor general, the BBC Trust delayed a timely independent examination of value for money and hindered parliamentary scrutiny,” the report said. “Where its own use of license payers’ money is in question, the BBC Trust should not inhibit the comptroller and auditor general’s ability to decide when an audit should be carried out.”

To contact the reporter on this story: Thomas Penny in London at tpenny@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net


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