Buyers screen BBC for greater savings

19 October 2011

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19 October 2011 | Angeline Albert

Buyers at the BBC are expected to deliver annual savings of £80 million by 2017.

The need to secure more savings follows a decision to freeze the licence fee settlement until 2017. The level of the TV licence fee is set by government and funds the BBC’s domestic broadcasting services.

The BBC plans to save around £670 million a year by 2016/2017 and estimates 2,000 jobs across the organisation will go.

In a statement earlier this month, the BBC Trust said “the planned programme of efficiencies will encompass both the back office functions and content and programme-making areas”. Speaking to SM, Gareth Nugent, head of strategic relationships BBC Procurement, said this week it was “too early to say” whether buying jobs would be hit.The jobs will not be lost in one go but across the next five years and the BBC will seek, wherever possible, to implement the reductions through turnover, redeployment and voluntary redundancy.”

As part of a package of purchasing actions designed to achieve the £80 million-a-year savings target, procurement is working to reduce the supplier base, volumes and specifications linked to internal stakeholder demands. The proposals aim to make efficiency savings in order to limit the impact on programmes and content. 

The procurement team is working on consolidating spend with fewer suppliers, moving more categories of spend to managed service providers and making savings across its strategic contract portfolio, which specifically includes its major contracts for technology, TV licensing, property and distribution.

In January, BBC director-general Mark Thompson launched Delivering Quality First, a consultation with staff about how the organisation can deliver high quality. It follows the licence fee settlement agreed with the government in October 2010, which sees the fee frozen to 2017 and the BBC assuming new funding responsibilities, including for the World Service and local TV. To meet this settlement, Thompson set a savings target of 20 per cent.

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