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Press Releases
Â鶹Éç Governors publish independent value for money studies
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The Â鶹Éç Governors have today laid before Parliament two independent studies:
The Â鶹Éç's Management of Risk by the National Audit Office (NAO); and Â鶹Éç
Independent Television Commissioning by Deloitte and Touche LLP (Deloitte).
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The reports are the last in the current three-year programme of studies,
commissioned by the Â鶹Éç Governors' Audit Committee and carried out by the NAO
and other agencies as part of its programme of value for money reviews.
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Under the new Charter and Agreement the Â鶹Éç Trust's relationship with the NAO
will be strengthened.
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The Â鶹Éç is currently working with the NAO on a proposed
programme of value for money studies for the Trust to consider commissioning
from January 2007 onwards.
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Jeremy Peat, Chairman of the Audit Committee, said: "The introduction of the
programme of reviews in 2003 marked a significant, positive change in the
Governors' approach to ensuring value for money at the Â鶹Éç.
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"Our constructive relationship with the NAO over the past three years has led
to useful insights into whether the Â鶹Éç is providing best value for licence fee
payers.
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"These two reports, the last in the current series, offer important
independent advice on how we can improve the management of risk and independent
commissioning at the Corporation in the future.
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"The new Charter offers the Â鶹Éç Trust an opportunity to strengthen further the
relationship with the NAO and ensure even greater value for money on behalf of
licence fee payers.
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"This will include the NAO reviewing the extent to which the
Â鶹Éç's future self-help targets are being met."
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Sir John Bourn, Comptroller and Auditor General and Head of the NAO, said: "My
review of the Â鶹Éç's management of risk completes the programme of studies which
I agreed with the Â鶹Éç Governors' Audit Committee in 2003.
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"And with arrangements
for the development of a further programme of studies in place, I am looking
forward to working with the new Â鶹Éç Trust in the next Charter period."
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Each report is published by the Governors along with their response and a
response from Â鶹Éç Management.
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The Â鶹Éç's Management of Risk
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As the NAO acknowledges, the Â鶹Éç faces a wide variety of risks ranging from
those associated with its broadcast output and the risk of transmission
failure, to risks in managing its resources.
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Risk management arrangements have
been in place for several years and at the start of 2006 these were
strengthened.
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The Board of Governors is pleased the NAO has concluded that the Â鶹Éç has an
appropriate framework for managing risks and that its approach is similar to
that of other organisations.
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The Board welcomes the report's recommendations for strengthening the Â鶹Éç's
arrangements for managing risks, including its suggestions that these are
embedded across the organisation through improved training and communication.
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In future the Â鶹Éç Trust's responsibilities for overseeing the Â鶹Éç's management
of risk will be different to that of the Board Governors.
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Under the new Charter
and Agreement the Trust is required to have in place a risk protocol specifying
how it will carry out its duties in this area.
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It will be published in the New
Year and will incorporate the NAO's recommendations.
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The Governors welcome the report and endorse Management's proposed action to
address these recommendations.
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Â鶹Éç Independent Television Commissioning
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As the report outlines, in recent years there have been a number of changes
affecting the Â鶹Éç's relationship with the independent sector.
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The commercial
framework within which the Â鶹Éç and independents work together has seen many
alterations, particularly in relation to Terms of Trade and Code of Practice.
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The introduction of the Window of Creative Competition from January 2007 will
have further implications for this relationship, as will any agreement to new
media rights with the independents' representative body, PACT.
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The Deloitte study acknowledges that the Â鶹Éç's ability to improve value for
money in commissioning from the independent sector is bound up with this
commercial framework and that normal commodity based procurement strategies are
less applicable.
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Nevertheless, the Board welcomes the report's conclusion that the Â鶹Éç's new
commissioning process places significant focus on effectiveness, that value for
money considerations are taken seriously within the organisation and that the
process includes controls to minimise value leakage.
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The report highlights limited areas in which the Â鶹Éç can improve the process,
including monitoring tariffs and reviewing the mechanisms for managing
royalties.
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The Governors welcome the report and endorse Management's proposed action to
address these recommendations.
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Notes to Editors
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 The reports are available online at bbcgovernors.co.uk.
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In 2003, the Â鶹Éç and the Government agreed an evolution in the
Governors' oversight of value for money. As a result, the Governors' Audit
Committee, in dialogue with the Comptroller and Auditor General - the head of
the National Audit Office (NAO) - established a programme of independent value
for money reviews.
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The reviews are undertaken by the NAO or other external
agencies. This is enshrined in the 2003 amendment to the Â鶹Éç's Agreement with
the Secretary of State. All studies under this programme performed by external
agencies, including the NAO, are reported to the Â鶹Éç Governors and subsequently
laid before Parliament by the Â鶹Éç together with separate responses from
Governors and Management. Ìý
The Â鶹Éç's new Charter and Agreement states that the arrangements should
continue and sets out how the Trust should strengthen its relationship with the
NAO. This includes the NAO's involvement in reviewing the extent to which the
Â鶹Éç meets its future self-help targets.
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Â鶹Éç Governance Unit
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