The BBC has set out plans to find additional savings of £125M ($156M) this year after making clear that its fixed license fee income does not mean it is immune to the coronavirus crisis.
The license fee generates £3.7B ($4.6B) for the BBC, but the British broadcaster’s commercial arm, BBC Studios, has taken a revenue hit during the pandemic, and the corporation has pledged to continue funding free TV licenses for people over the age of 75.
The financial damage was outlined internally by director general Tony Hall on Wednesday and reinforced in an email to staff on Thursday from group managing director Bob Shennan.
“We’re not immune from the challenges faced by economies and businesses around the world,” Shennan said. “We’re getting less money from the licence fee, while our commercial operations are bringing in less revenue too. We are doing everything we can to protect our income, but we need to look at our spending too.”
Shennan set out some “immediate” actions to cut costs. These include freezing pay for senior leaders until at least August 2021, pausing all non-essential hiring, and offering employees the opportunity to work part-time or take unpaid leave should they wish to do so. The BBC is also delaying its annual staff pay negotiations for six months.
Shennan said: “These are measures that are certainly not easy – especially at a time when there’s uncertainty all around us. But they do need to be taken if we are to continue to operate and keep on delivering for our audiences.”
During an Edinburgh TV Festival YouTube event on Monday, BBC director of content Charlotte Moore made clear that content will not be shielded from the cuts.
“I have absolutely no doubt that we will all be affected,” she said. “Where that lands all depends on where we get back into production, so it’s really hard for all of us [to predict]. There is so much uncertainty — we’re trying to work with the budgets we’ve got, but not really knowing where we will end up on how much money we will have to spend this year and how much money we will have for next year. We’re not going to be immune from financial constraints.”