The BBC Trust has instructed Director-General Mark Thompson to cut the salaries of management by 25 per cent over the next three and a half years and to reduce the number of senior managers by 18 per cent by July 2013.
The body says it has also endorsed a new pay strategy for senior managers who join the BBC and will impose a freeze in the pay of Executive Board directors for a further three years.
Members of the BBC’s Direction Group and all Executive Directors are subject to an “indefinite suspension of bonuses” and other directors and senior managers will have bonuses suspended for a further two years.
In addition all senior roles are to be reviewed when they become vacant and all senior manager pay is to be discounted against the private sector rate for any post.
The move follows widespread public concern over the levels of the Licence Fee diverted from programme making into the salaries and expenses of the BBC’s top management.
Earlier this year it was revealed that BBC management routinely used expenses to pay for gifts for some of the BBC’s biggest earning stars.
BBC Trust Chairman, Sir Michael Lyons, said the measures “will have implications both for current and future BBC employees” but said it was “right that as a major public service organisation, the BBC shows leadership on this issue during difficult economic times.”
Thompson said: “The review published today demonstrates that the BBC is already achieving a significant discount against peer group organisations in its remuneration of senior managers. Nonetheless, I and every other senior manager need to recognise that we are in a different economic climate, that the media sector labour markets are depressed and that there are significant pressures on public finances.”
There are currently over 630 senior manager posts within the BBC’s public service operations and a salary bill for Executive Board directors and senior managers of around £79m. At the current TV Licence fee rate of £142.50 for a colour licence it takes the Licence Fees of more than 554,000 homes to pay their salaries.