The cuts have been blamed on a £150m hole in finances caused by the so-called "iPlayer loophole", where viewers avoid the licence fee by watching BBC programmes online.
Although the loophole is due to be closed during the next BBC Charter period, the BBC has also got to deliver further savings in the next five years due to taking on the cost of over 75s TV licences at the end of the decade, and must identify another £550 million of savings to be made by 2021/2022, with a further announcement expected in the spring.
Cuts in detail
- £50 million will be saved by creating a simpler, leaner BBC, with fewer divisions and senior managers, fewer layers between the top and bottom of the organisation and cutting 1,000 posts. Strong progress is already being made – the first phase of work is now complete and subject to staff consultation and further detailed work:
- c.£25 million will come from reducing back office and professional support services.
- c.£10 million from reducing management layers in content areas. Discussions are now beginning with those affected.
- £35 million will be saved from the BBC’s TV sports rights budget.
- A further £12 million will come from the BBC’s TV budget. Drama will be protected. This will mean some reductions to factual, comedy and entertainment. Savings from The Voice UK (moving to ITV) will be used to develop new, home-grown formats.
- £12 million will be cut from BBC Online. This will involve rationalising new features, innovation and development across the BBC’s digital services, and focusing on those with greatest impact
- £5 million will come from BBC News. This will include efficiency savings from a review of working practices, terms and conditions, and commercial income or cost reductions in BBC Monitoring (subject to approval from the BBC Trust)
- £20 million of savings will come from long-term contracts and other costs, due to the current lower levels of inflation
- The final c.£16million will come from cross-cutting areas, including
- Savings in distribution costs (the cost of getting BBC TV and radio services to your home)
- Exploring a phased exit from the broadcast Red Button service and focusing on interactive TV offerings on connected televisions and iPlayer
- Exploring further savings from BBC Online
Director-General Tony Hall said:
“The BBC has and is doing everything possible to make sure the impact on the public is minimised. Wherever possible we’re targeting savings by creating a simpler, leaner BBC.
“But cuts to budgets for programmes and services are unavoidable. No Director-General wants to announce reduced spending on services that the public love. This is very tough, but the BBC’s financial position means there is no alternative.”