The BBC’s savings target has rocketed by 40% to £400M ($493M) and the corporation is responding by cutting 1,000 hours worth of shows per year.
Issued in the past few minutes, the BBC’s Annual Plan said there will be an “acceleration” of savings plans due to the freezing of the license fee, which should end next year, and the “economic environment.”
The BBC revealed it is therefore projecting a deficit of £352M, up from this year’s £271M.
Alongside its move to reinvest £300M into online and digital, which was announced last May, the corporation is therefore upping its savings target from £285M to £400M by 2027/28.
Painful decisions are to come, including an annual reduction of 1,000 hours in commissions “across the portfolio,” said the Annual Plan, which is delivered around Easter each year with a focus on the BBC’s priorities for the coming financial year. Since taking on the role, Director General Tim Davie has spoken of the need to take a ‘fewer, bigger better’ approach to commissioning but the 1,000 hours figure is by far the biggest yet, superseding last year’s decision to cut around 200.
The BBC pointed to other cost-saving measures including the controversial creation of a single, integrated BBC News channel, shifting World Service TV and radio broadcasts to digital and the “increased efficiency and effectiveness of our operations by changing the way we work across the BBC.”
“There will be more of these difficult choices to come this year, but we will make them with audience value at the forefront of our thinking,” added the Foreword to the Annual Plan.
The Plan, however, stressed the corporation’s “strong financial position.”
License fee income reached nearly £3.7B last year and total income was up around the £5.5B mark.
Beyond next year, it said the “pace and scale of change” will increase “as audiences around the world turn to online-only services and platforms for an ever-greater share of their media time.”
Production-distribution outfit BBC Studios will also seek more growth opportunities as Davie looks to leverage his former employer for greater commercial returns to the BBC.
Elsewhere, The BBC has committed at extra £50M per year to online services by 2025/26, and noted regulator Ofcom was backing its plan to run some shows beyond its current 12-month BBC iPlayer window “to widen user choice and deliver more value from the licence fee.”
And in a sign that the BBC has been paying heed to UK media regulator Ofcom, the BBC used the Annual Plan to set out proposed changes that would require regulatory approval. This came after Ofcom set the BBC’s operating license for the next few years, which has seen a reduction in quotas, and simultaneously chided the corporation for failing to clearly set out how it plans to make changes.
Next up for the BBC is a review into its social media guidance following the Gary Lineker row, a move that paved the way for him to return to his Match of the Day hosting duties.
The Annual Plan said the review has not yet been launched although it is anticipated shortly. A BBC spokesperson this afternoon confirmed it would commence soon.
Richard Sharp, the Chairman of the BBC, said: “The BBC’s performance in delivering against its strategic priorities has been outstanding, particularly in such a challenging financial setting and against a backdrop of increased competition. This plan sets out how we will best serve all audiences by making the most of our resources in the coming year.”
Sharp has been keeping a low profile since it was revealed he had helped facilitate a loan for former Prime Minister Boris Johnson via the UK’s Cabinet Secretary Simon Case and Johnson’s distant cousin Sam Blyth. His handling of the Lineker situation has also been questioned.
Additional reporting by Jesse Whittock
