The BBC will axe two thirds of its senior managers, curb the pay and perks of those remaining and introduce a cap on the director-general’s salary, its new chairman has announced.
 

Lord Patten, chairman of the BBC Trust and a former chairman of the Conservative Party, promised to take action over the “toxic” issue of executive pay in his debut speech to the Royal Television Society in London yesterday.
 
The broadcaster needed to “distance itself from the market”, Patten said, because licence fee payers did not expect it to pay “sky-high commercial rewards to people that work for a public service”.
 
As a result, the BBC would become the first organisation to implement proposals from the recent Hutton Review into public sector pay by publishing its “pay multiple” so that the public could compare pay at the top with that of the rest of the workforce.
 
The aim here is to introduce a cap on top executive pay to ensure that it is no more than nine times higher than the median wage of other BBC staff, which is £39,668. This means that executive bonuses will remain frozen and private health insurance for senior managers will be scrapped.
 
The director general’s pay will likewise be capped at its current multiple, which is understood to be 17 times the median. When Mark Thompson was eventually replaced, this situation would enable the Trust to “secure the right candidate at a lower multiple”, Patten said – or in other words more cheaply.
 
But he also revealed plans to cut the number of senior managers employed by the corporation from about 530 to 200 by 2015. Although there were 15% fewer senior managers today than two years ago, the goal was to reduce the number of top executives from 3% of the total workforce to 1% in order to “create a smaller group of people more clearly accountable for spending the licence fee”, Patten added.
 
As well as cutting posts, the move would “also mean a redrawing of the boundaries around who is and is not a senior manager”, he said.