BBC managers face pay freeze and bonus cut

The BBC has axed pay increases and bonuses for more than 400 senior staff until after 2010 in a cost-cutting exercise, partly triggered by the recession.

BBC director general, Mark Thompson, sent an email to staff this morning detailing proposals to cut bonuses and freeze wage increases as part of move to save £20m over 18 months.†

Other steps include axing bonuses for some lower grade employees in the public services businesses and BBC†Resources until after 2010. In addition, salaries in the commercial businesses will be frozen until after June 2010, although staff in BBC Worldwide and BBC World News will continue to be eligible for annual bonuses in line with existing contractual commitments.

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The cost-cutting initiative is designed to offset the negative impact of last year’s rise in inflation on the BBC’s spending power and an expected fall in licence fee income due to the recession and a decline in household growth.†

Mark Thompson said: “I recognise that this is a tough message. However we believe it is the right decision for the BBC to take in these difficult times. The directors and I have discussed this very carefully and concluded it is not appropriate to award an increase in pay or award a bonus this year to the senior managers of the organisation – but that we should continue with a modest pay review for the majority of the BBC’s employees.”