Committee of Public Accounts


Press Notice dated 7 July 2006


A STATEMENT FROM EDWARD LEIGH MP
CHAIRMAN OF THE COMMITTEE OF PUBLIC ACCOUNTS

National Audit Office reports: The contract between the BBC and Siemens Business Services for the provision of technology services

The BBC's definition of overheads

After originally being told the deal with Siemens would deliver guaranteed annual savings of £35.2 million, the BBC Governors have now learned that savings in the first year have been estimated at £21.5 million. Although the BBC is saving money through the contract, the fact that these savings are not as high as first expected, and that a worrying number of projects are late or over-budget, should set alarm bells ringing. The BBC needs to get a firm grip on this contract.

Any broadcaster should be naturally keen to spend as much of its money as possible on programmes, and therefore the BBC's attempt to measure its overheads should be welcomed. But the measure as it stands is not of much use to BBC managers and the BBC needs to be much clearer in reporting its performance to licence fee payers.