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Too soon to tell whether BBC’s £224m relocation to Salford will deliver value

 

The BBC relocated to Salford on time and maintained broadcast continuity, according to a report published today by the National Audit Office for the BBC Trust. Moreover, the latest estimates show that the final cost of the move phase should be below the £233 million budget approved by the BBC Trust. Image Media City BBC Salford Quays CC credit Grahamc99

The BBC relocated to Salford on time and maintained broadcast continuity, according to a report published today by the National Audit Office for the BBC Trust. Moreover, the latest estimates show that the final cost of the move phase should be below the £233 million budget approved by the BBC Trust. Image Media City BBC Salford Quays CC credit Grahamc99

The BBC relocated to Salford on time and maintained broadcast continuity, according to a report by the National Audit Office for the BBC Trust. Moreover, the latest estimates show that the final cost of the move phase should be below the £233 million budget approved by the BBC Trust.

According to the NAO report, the BBC estimates that the final cost of fitting out the buildings at Salford and moving people in will be £224 million, £9 million less than the revised budget approved by the BBC Trust in February 2011. The lifetime budgeted cost of relocation and operating costs up to 2030 is £942 million (or £573 million after discounting future costs to their present values). This cost does not take into account reduced spend on the BBC’s estate in London and Manchester as a result of the move.

However, the NAO says, it is too early to judge the long-term impact and value for money of the move for licence fee payers. Whether the move delivers value for money will depend on the BBC’s ability to achieve a sustained improvement in audience approval in the north, embed new ways of working to achieve efficiencies of £151 million and provide sustainable economic benefits for the region, the public sector auditing body.

The NAO’s findings also included the following:

  • The BBC successfully completed the complex challenge of relocating to Salford, by using the right skills and processes, developing clear delivery plans and maintaining good communications. The BBC recruited staff with expertise in managing relocations and set up a project team that developed and implemented plans for the move.
  • The BBC exceeded its target to relocate 30 per cent of staff from the 1,500 roles transferring from London to Salford (38 per cent relocated).
  • To encourage sufficient staff to move, some of the allowances the BBC offered to incentivise and compensate relocating staff and minimise redundancy costs were more generous than it normally offers. For example, the remote location allowance covered the cost of renting property in Salford and travelling to and from London for two years. This allowed staff who were unable or unwilling to commit to moving permanently to keep their homes in the southeast. The BBC benchmarked some allowances, but controls over exceptions to its relocation policy for Salford were inadequate.

Anthony Fry, chair of the Trust’s finance committee, said:

“Now a solid and thriving production base with major live programming broadcast 24 hours a day, Salford has a strong working culture that should deliver long-term improvements in both creativity and efficiency, as long as the BBC keeps focused on these objectives.”

Amyas Morse, head of the National Audit Office, said:

“The BBC relocated to Salford on time and without disruption to broadcast services, and the final cost of moving should be within budget. Skills were maintained and redundancy costs reduced by offering London-based staff more generous relocation packages than it usually offers to encourage them to move, though the BBC could have controlled these better.

“However, it is too early to judge whether the move will achieve value for money for licence fee payers. It is welcome that the BBC has developed an appropriate approach to measuring the future impacts of the move but it still needs to explain how it is going to make all of its planned efficiency savings.”

 

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