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Press Releases
91Èȱ¬ Governors publish independent value for money studies
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The 91Èȱ¬ Governors have today laid before Parliament two independent studies:
The 91Èȱ¬'s Management of Risk by the National Audit Office (NAO); and 91Èȱ¬
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 91Èȱ¬ 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 91Èȱ¬ Trust's relationship with the NAO
will be strengthened.
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The 91Èȱ¬ 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 91Èȱ¬.
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"Our constructive relationship with the NAO over the past three years has led
to useful insights into whether the 91Èȱ¬ 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 91Èȱ¬ 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
91Èȱ¬'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 91Èȱ¬'s management of risk completes the programme of studies which
I agreed with the 91Èȱ¬ 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 91Èȱ¬ 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 91Èȱ¬ Management.
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The 91Èȱ¬'s Management of Risk
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As the NAO acknowledges, the 91Èȱ¬ 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 91Èȱ¬ 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 91Èȱ¬'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 91Èȱ¬ Trust's responsibilities for overseeing the 91Èȱ¬'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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91Èȱ¬ Independent Television Commissioning
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As the report outlines, in recent years there have been a number of changes
affecting the 91Èȱ¬'s relationship with the independent sector.
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The commercial
framework within which the 91Èȱ¬ 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 91Èȱ¬'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 91Èȱ¬'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 91Èȱ¬ 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 91Èȱ¬ 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 91Èȱ¬'s Agreement with
the Secretary of State. All studies under this programme performed by external
agencies, including the NAO, are reported to the 91Èȱ¬ Governors and subsequently
laid before Parliament by the 91Èȱ¬ together with separate responses from
Governors and Management. Ìý
The 91Èȱ¬'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
91Èȱ¬ meets its future self-help targets.
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91Èȱ¬ Governance Unit
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