BBCGroup Annual Reportand Accounts 2018/19

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BBCGroup Annual Reportand Accounts 2018/19

Presented to Parliament by the Secretary of State for Digital,
Culture, Media and Sport by Command of Her Majesty
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OV E R V I E WContents
About the BBC
2
Inform, Educate, Entertain
4
Highlights from the year
6
Award-winning content

p.2

Strategic report
8
A message from the Chairman
10 Director-General’s statement
16 Delivering our creative remit
18 – Impartial news and information
22 – Learning for people of all ages
26 – Creative, distinctive, quality output
34 – Reflecting the UK’s diverse communities
48 – Reflecting the UK to the world
55 Audiences and external context
56 – Audience performance and market context
58 – Performance by Service
61 – Public Service Broadcasting expenditure
62 – Charitable work
63 – Environmental sustainability
64 – Audience engagement report
66 Commercial operations
68 – BBC Studios
73 – BBC Global News
74 – BBC Studioworks
75 – Governance of BBC’s Commercial Holdings
76 Our people
87 Finance and operations

About the BBC

Highlights from the year andaward-winning content

p.8
Forewords from the Chairman
and Director-General

Commercial operations
p.66

p.55
Audiences and external context

A look at the performance of our network
television and radio services

Delivering our creative remit

Financial statements
185 Certificate and Report of the Comptroller
and Auditor General
202 Consolidated income statement
202 Consolidated statement of comprehensive(loss)/income
203 Consolidated balance sheet
204 Consolidated statement of changes
in equity
205 Consolidated cash flow statement
206 Key themes for the BBC
207 Notes to the accounts

How we’ve met the requirementsof our public purposes

p.16

p.258

Additional information
258 Equality Information Report
284 Index
285 Copyright and photographer credits
286 Contact information and feedback

Equality Information Report

p.184

p.96

Detailed financial statements

Governance

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Governance98 BBC Board
100 Executive Committee
100 Next Generation Committee
101 Corporate Compliance Report
102 Remuneration Report
111 Pay disclosures
120 NAO opinion on pay disclosures
121 Nominations Committee Report
122 Audit and Risk Committee Report
127 Risks and opportunities
132 Viability Statement
133 Commercial Holdings Board Report
134 Editorial Guidelines and Standards
Committee Report
136 Nations Committee Reports
138 Fair Trading Report
140 Independent Fair Trading Auditors’ Report
141 Statement of Board responsibilities
142 Performance against public commitments
166 Nations’ data packs
183 NAO opinion on Nations’ data packs

BBC Group Annual Report and Accounts 2018/19

1

ABOUT THE BBC

Inform, Educate, Entertain
Our mission has remained the same for almost
100 years. We act in the public interest, serving all
audiences through the provision of impartial,
high-quality and distinctive output and services
which inform, educate and entertain.

We deliver
our public
purposes…
Read more on pages 16-54… creating
cutting-edge
content…

1. To
	 provide impartial news andinformation to help people
to understand and engage
with the world around them.
To support learning for2. 	people of all ages.
3. To show the most creative,
highest quality and distinctive
output and services.
Record-breaking dramas
The finale of Bodyguard was the UK’s
most watched episode of any drama series
across all channels since current records
began, in 2002, attracting 17.1 million
viewers (consolidated figures). The firstseries of Killing Eve was a hit with younger
audiences and has been requested
42.5 million times on BBC iPlayer.
A channel for modern Scotland
Launched in February 2019, BBC Scotland
features a mix of documentary, popular
factual and entertainment, comedy,
drama, news and current affairs and sport.

Read more on pages 4-7 and 26-33… broadcasting
across multiple
channels…
Read more on pages 16-54

2

Personalisation
With over 17 million people now
signing into their BBC Account every
month, we’re starting to deliver more
personalised experiences – such as

Television
Nine pan-UK television services, including
online-only youth service BBC Three.
National and regional television
services across England, Northern
Ireland, Scotland and Wales, including
the new BBC Scotland channel.
Radio
Ten pan-UK radio networks andtwo national radio services each in
Scotland, Wales and Northern Ireland.
40 local radio stations across England

BBC Group Annual Report and Accounts 2018/19

4. To reflect, represent
and serve the diverse
communities of all of the
UK’s nations and regions
and, in doing so, support
the creative economy
across the UK.
To reflect the UK, its culture
5. 	
and values to the world.

recommending programmes basedon their tastes and preferences in
BBC iPlayer and BBC Sounds.
Dynasties
Reframing the nature documentary, thislandmark series averaged over 7.5 million
viewers per episode across the series
and was released in ultra HD on iPlayer.
At the heart of the action
There were 66.8 million requests
for all FIFA World Cup action acrossBBC iPlayer and BBC Sport.
Channel of the Year
CBeebies was named Channel of
the Year at the Royal Television
Society Programme Awards.

and the Channel Islands. The BBC
World Service television, radio andonline in more than 40 languages.
OnlineOnline services including BBC News,Sport, Weather, CBBC and CBeebies,
iPlayer, BBC Sounds, BBC Bitesize,
BBC Red Button and our vastarchive via a variety of internetconnected devices including tablets,
smartphones and connected
televisions – as well as computers.

Multi award-winning drama, Bodyguard

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OV E R V I E W… workingwith talentfrom acrossthe creative
industries…
Read more on pages 76-86 and 159… ensuring
value formoney for ouraudiences…
See pages 88 and 184 for more
information

BBC staff
Our people are talented, diverse,
dedicated and passionate. They makeus what we are.

Knowledge sharing
BBC engineers have always beenat the forefront of technologicaldevelopment. We provide a ‘centreof excellence’, sharing advances andbest practice across the industry.

Partnerships
We work with organisations thatshare our passion for creativity,
quality and distinctiveness.
Investment
The BBC is a major investor in the UK
creative industries, contributing hundredsof millions of pounds to the wider sector.

Training
We are committed to offering training
and development to everyone. In
2018/19 90% of BBC staff completed
one or more training course.

Investing as much money as possible
in delivering great content and services
Reduction in overheads
95% of the BBC’s controllable spend
this year was focused on content
and delivery, just 5% was spent
on running the organisation.

Senior managers
Senior managers now make up just 1.4%of our total public service employees.

Dividends from commercial subsidiaries
A total of £73 million was declared to
the BBC Group from BBC Studios, BBC
Studioworks and BBC Global News.

Total cost savings£153 million of annual savings weredelivered during the year, taking the
cumulative savings to £397 million.

… and delivering 74% 75% 74% 75% 71% 72% 76% 77%
on our mission.
17/18% of UK adults
who say the BBC iseffective at informing,
educating andentertaining people
in the UK (10% say
ineffective. 17/18: 8%).

17/18

17/18

17/18

% of UK adults
who say the BBC iseffective at informing
people in the UK(10% say ineffective.
17/18: 9%).

% of UK adults
who say the BBC iseffective at educating
people in the UK(10% say ineffective.
17/18: 9%).

% of UK adults
who say the BBC
is effective atentertaining people
in the UK (9% say
ineffective. 17/18: 7%).

Source: Ipsos MORI

Source: Ipsos MORI

Source: Ipsos MORI

Source: Ipsos MORI

Read more on pages 55-61

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BBC Group Annual Report and Accounts 2018/19

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ABOUT THE BBC

Highlights from the year
This year saw an astonishing 3.6 billion programme requests on
iPlayer, the arrival of a dedicated channel for Scotland, the launch of
BBC Sounds and the announcement of a major new streaming service.
We continue to bring audiences, across the UK and around the globe,
award-winning content on television, on radio and online.

91%

Adult reach
Percentage of UK adults who use BBC
television, radio or online each week.
2017/18: 92%
Target: 88-93%

BBC Sounds
As part of our ongoing commitment toreinvent the BBC for a new generation,
we have launched BBC Sounds, abrand new audio product bringing
together our live and on demand radio,
music and podcasts into a single
personalised product.

BritBox
We announced BritBox, a new
subscription service with ITV which willfeature the biggest collection of British
content available on any streaming
service for UK audiences.

7/10

General impression
Audiences’ general impression of the BBC(mean average).
2017/18: 7/10
Target: 6-7/10

18:00
Total time spent
Length of time UK adult audiences spend
with the BBC each week on average.
2017/18: 19:12
Target: 17:15-18:45

4

Killing Eve
The first episode of the incredible Killing Eve
became the second-best performing BBC iPlayer
episode ever, with 9.2 million requests, whilst
the series overall had 42.5 million requests by
the end of December – the second biggest
drama box set iPlayer has ever seen.

BBC Group Annual Report and Accounts 2018/19

42.5m
iPlayer requests by
the end of December

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OV E R V I E W

iPlayer
3.6 billion programmes were requested
on iPlayer throughout 2018, withaward-winning British dramas Bodyguard,
Killing Eve and McMafia topping the listof most requested-transmissions.

BBC Scotland channel
The new dedicated channel for Scotland launched in February and has madea strong start, attracting record digital audiences for its opening night schedule.

Plastics Watch

A massive 44.5 million people tuned in to watch one of the mostentertaining World Cup tournaments to date on BBC TV last summer.

Following the huge global impact ofBlue Planet II we launched Plastics Watch,a new initiative bringing together BBC
content about plastics in one place tohelp provide information on how we canreduce plastic pollution.

First LGBT
correspondent

Local News
Partnership

Record-breaking World Cup

Ben Hunte, an award-winningjournalist, began his role as the firstLGBT correspondent for BBC News,
reporting on the stories, issues anddebates surrounding sexuality andgender with a focus on providing insightand analysis on matters affecting theLGBT community in the UK.

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Own ItChildren getting their first smartphone
will be able to receive help staying safe
online with a new ‘Own It’ app, part ofthe BBC’s commitment to supporting
young people in today’s changing media
environment. It will provide a helping
hand to youngsters taking their firststeps online and on social media, toensure they have a healthy experiencein the digital world.

The Local News Partnership, whichsees the BBC fund public service local
journalism, has distributed more than
78,000 public service stories alreadyand is now attracting international
attention from other countries keen
to replicate its success.

BBC Group Annual Report and Accounts 2018/19

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ABOUT THE BBC

Award-winning content
We invest in award-winning programmes andservices across television, radio and online.

5Golden Globes
January 20195

Writers’ Guild Awards
January 20198

Broadcast Awards
February 2019

16
11

12
6

British AcademyChildren’s Awards
November 2018

6

BBC Group Annual Report and Accounts 2018/19

British Academy Television Awards
May 2019

Association forInternational
BroadcastingAwardsNovember 2018

British Academy
Scotland Awards
November 20186

National Television
AwardsJanuary 2019

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OV E R V I E W

16British Academy
Television Craft
AwardsApril 20199

British Academy
Cymru Awards
October 20188

Broadcast DigitalAwardsJuly 2018

36

5

Audio and Radio Industry Awards
October 2018

RTS Television
Journalism Awards
March 2019

8
11

15
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RTS Programme Awards
March 20197

Grierson Awards
November 2018

Broadcasting Press
Guild Awards
March 2019

Comedy.co.uk
AwardsFebruary 2019

BBC Group Annual Report and Accounts 2018/19

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ABOUT THE BBC

A message from the Chairman

The BBC was founded almost a century
ago with a mission to inform, educate
and entertain. This Annual Reportand Accounts sets out how, over the
past year, the BBC has delivered
successfully on that mission andthe five public purposes that define
it, as well as on the responsibility
we have to our audiences to deliver
exceptional value for their licence fee.
Nowhere is this more obvious than in
the quality of our output. Audiences intheir millions have been gripped by hit
shows across all genres, from Bodyguard
to Dynasties to the latest series ofStrictly Come Dancing. Meanwhile,
BBC news teams have kept audiences
up to date on every twist and turnof Brexit developments, based on atireless commitment to impartiality,
fact-checking, and in-depth analysis.
As Chairman, I am pleased that this reportdemonstrates how both audiences andthe corporation itself are benefiting froma well-run BBC. It provides evidenceof a Board and Executive firmly united
behind the BBC’s strategic priorities.
First amongst these is our goal ofreinventing public service broadcasting
for a new generation responding, inparticular, to the challenge presented
by well-resourced competitors such as
Netflix and Spotify, who are changing
the way audiences watch video andconsume audio. This means modernising
our services for the digital age – a
key focus for the Board this year.

8

We are acutely aware, for example, that it isthrough our online services that audiences
increasingly expect to receive value for theirlicence fee. That is why this year saw thelaunch of BBC Sounds as a single productbringing together all our radio, music, andpodcasts in one place. It also saw us set
out our plans to reinvent BBC iPlayer.
Where BBC iPlayer was once a catch-up
service, it is now vital for us to ensurethat it becomes a destination in its own
right. More and more, we know audiences
will come to see BBC iPlayer as thefront door to our content offer. And in
the on demand world, it is clear that the
30-day viewing window, for example,
offers less and less public value.
Our plans therefore include making
programmes available for at least
12 months after they are first shown,offering more complete series box
sets and multi-series back catalogues,
and making more content available
from our extraordinary archive.
These are important changes. Our researchshows that audiences believe they will makeBBC iPlayer a better place to watch TV,
as well as offering better value to licencefee payers in the on demand age. It is
important to recognise, however, that they
are also relatively straightforward changes,
designed to bring BBC iPlayer in line withwhat the rest of the market is already doing.
We believe the BBC must be allowed tomove quickly to meet the fast-changing
needs and expectations of our audiences

BBC Group Annual Report and Accounts 2018/19“Where BBC iPlayer
was once a catch-up
service, it is now vitalfor us to ensure that it
becomes a destinationin its own right. Moreand more, we know
audiences will see
BBC iPlayer as thefront door to ourcontent offer.”
Sir David Clementi
Chairmanand keep pace with our competitors. This
raises important issues ahead of the midterm review of the Charter, which will focus
on governance and regulatory issues andconsider whether further improvements
are necessary during the current Charter
period. In particular, the review will needto look again at whether regulation born in
the linear era remains fit for the digital age.
Another major priority this year has been
the goal of making the BBC the best
possible place for our people to work,
driving fairness and efficiency. This year,
two Board-commissioned independent
reviews found the BBC to be one of
the most transparent organisations in
the country. Led by Will Hutton andChristopher Saul, they concluded thatthe BBC has already built high levelsof transparency in recent years but
recommended ways to go even further.
We are determined to lead the way inthis area, so that staff and licence fee
payers alike have the information theyneed to see the BBC’s commitment
to equality, fairness, and efficiency.

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S T R AT E G I C R E P O R T

The increased focus in this year’s reporton our commercial operations reflects thefact that they are becoming ever morevital to the health of the whole group. This
year marks the first full year of operationof the new BBC Studios, following ourdecision to merge our production anddistribution arms. It is encouraging that
BBC Studios has made such a confident
start. Programmes like Luther and Les
Misérables, Top Gear and Doctor Who have
set the creative standard and underline thebreadth and diversity of BBC Studios’ work.
Our recent announcement that BBC
Studios would be taking control of
UKTV and the bulk of its channels is afurther example of how we are looking
to reshape our commercial operationsin the shifting media landscape.
Under the deal we have announced with
Discovery, BBC Studios will take fullownership of the seven UKTV channels
which best fit our programmes – including
Dave, Alibi, and Gold – with Discovery
acquiring the remaining three lifestylechannels. This will help secure both theBBC’s ability to get long-term value
from the programmes paid for by thelicence fee and UKTV’s continuing
investment in British creativity.
At the same time we announced a longterm partnership with Discovery to takethe best of the BBC’s factual programmes
to audiences across the world on a new,
Discovery-owned subscription video
platform, after they have been shown on
the BBC in the UK. This represents ourlargest ever content sales deal, and will
enable the BBC to invest even more in
factual programming for British audiences.

Our goal is to see BBC Studios powering
forwards in the months and years
ahead. We know that growing ourintellectual property – owning the rights
to programmes so we can return theirfull commercial value to licence fee
payers – is vital for the BBC’s future.
Another important announcement thisyear was the decision we have taken,
with ITV, to launch a new subscription
streaming service in the UK: BritBox. This
will be the first time British public service
broadcasters have come together to createa subscription video-on-demand service inthis country, building on the success of our
joint commercial service in North America.
It means audiences can look forward to an
unrivalled collection of British box sets andoriginal series, on demand, in one place.
This year the Board commissioned an
important review to look at the operationof our commercial subsidiaries. I was
pleased when it found that the BBC’s threewholly-owned commercial businesses –BBC Studios, BBC Studioworks and BBC
Global News – are exhibiting commercial
efficiency and doing what they should.
A critical factor in this achievement – aswith so many others in the BBC over the
past six years – was the oversight, input
and expertise of Anne Bulford, who left
her role as Deputy Director-General at theend of 2018/19. I would like to pay tribute,on behalf of all my Board colleagues, toAnne for the exemplary commitment,
skill and insight she provided both tothe Board and the BBC as a whole in her
time with us, on issues big and small.

And, of course, the biggest issue the Board
has had to consider over the past year
concerned the future of free TV licences
for the over-75s.
In February, we concluded a broad, threemonth public consultation on this subject.
Based on the responses we received fromthe public and from stakeholders, andwith reference to the three criteria we
identified at the start of the process –fairness, financial impact, and feasibility– the Board recently reached a decision.
From June 2020, any household withsomebody over 75 who is in receipt ofpension credit will receive a free TV licence.
We think it is a fair decision: fair to thoseover 75, since we target those most in
need; and fair to all our audiences, since
there was no appetite for the substantial
cuts to BBC services that would havebeen necessary if the concession had
been extended to all those over 75.
This has been an immensely difficult
decision, and the Board has spent a
considerable amount of time analysing theoptions. I believe this outcome represents
the fairest possible in the circumstances.

Sir David Clementi
Chairman
20 June 2019

The class of Strictly Come Dancing 2018

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BBC Group Annual Report and Accounts 2018/19

9

ABOUT THE BBC

Director-General’s statement

This has been a year of outstanding
creative success for the BBC. In January,
I set out to staff what our priorities must
be as we continue to reinvent theorganisation for the future. We need tostand up for trust and impartiality innews. We need to continue to transform
our digital services. We need to make surethe BBC is a truly great place to work. But
first and foremost, always, we need tokeep putting creativity at the heart ofthe BBC.
Two big highlights in particular tell, for me,
an important story about how the BBC isreinventing itself for all audiences in thedigital age.
The first, Bodyguard, was a phenomenon.
The nation was gripped on Sunday nights.
17 million people watched the finale. It
was a show that proved, once again, that
there’s still very much a place for brilliant,appointment-to-view TV that brings thewhole country together. It was the biggest
drama on UK television in over a decade.
The second, Killing Eve, gained a hugeaudience on iPlayer. Released as a box
set, it had 42.5 million requests to viewby the end of December. People seemedto swallow it up, almost in one sitting.
And once Phoebe Waller-Bridge, Jodie
Comer, and Fiona Shaw picked up richly
deserved BAFTAs – for best drama series,
best actress, and best supporting actressrespectively – almost one million requests
were made in the following seven days,
showing the benefit to audiences of keeping
our best content on iPlayer for longer.
These two shows were both big hits withthe 16-34 age group, where we know
there is so much competition fortime and attention.

10

Together, for me, they encapsulate
what audiences can expect from a
reinvented BBC. We want to keep doing
what we have always done best: making
world-class, distinctive British content;
supporting and investing in home-grown
talent; bringing the whole country
together and getting them talking.
At the same time we want to take every
opportunity to reach and serve all ouraudiences in new and exciting ways. Thatmeans content that takes even morecreative risks. It also means services thatare increasingly tailored and relevant –from a more personalised BBC iPlayer
to the freshly-launched BBC Sounds
and our new BBC Scotland channel.
And this report illustrates how we are
reinventing the BBC for audiences
not just at home, but also around theworld. We now have a weekly global
audience of 426 million adults – anincrease of over 13% in just one year.
It’s proof that the BBC can do morethan ever for the UK in taking Britain’s
distinctive voice, culture and values tothe world. It’s also evidence that we havewhat it takes, with the right support, tocompete with the might of the US-basedtech giants in an increasingly global
and competitive media landscape.

BBC Group Annual Report and Accounts 2018/19“This year ouraudiences havestarted to experience
what a reinvented
BBC looks andsounds like.”
Tony Hall
Lord Hall of Birkenhead CBE
Director-Generaland Editor-in-Chief

A year of outstanding creativity
These pages contain countless examplesof what a great year this has been for
the BBC creatively. New shows such as
Informer and A Very English Scandal,
for example, alongside the return ofhits like Line of Duty, Idris Elba’s Lutherand Jodie Whittaker’s Doctor Who. And
they are far from limited to drama.
In comedy, this year has seen the muchanticipated return of Phoebe WallerBridge’s Fleabag, Peter Kay’s Car Share,
and Alan Partridge with This Time. In
natural history, we have built on theextraordinary success of Blue Planet IIamongst audiences of all ages with
programmes such as Dynasties, Liz Bonnin’s
Drowning in Plastic and Blue Planet Live.

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S T R AT E G I C R E P O R T

Documentaries from Stacey Dooley,
Romesh Ranganathan, Sue Perkins,and Louis Theroux have taken on big
issues from unique perspectives. In
entertainment, we have seen anothersensational series of Strictly Come Dancing,along with latest Saturday night choices,
The Greatest Dancer and All Together Now.

The BBC also swept the board thisyear at the Audio and Radio Industry
Awards (ARIAs). In total, teams from
News, network, nations, and local radio
took home 36 gold, silver and bronze
awards – with Radio 1 and BBC Radio
Leeds winning the coveted Nationaland Local Station of the Year titles.

It is not only unmissable TV moments thathave brought the nation together this year.
From the 24 million we reached with ourcoverage of the Royal Wedding, to the 23
million who joined us across the weekend
commemorating the 100th anniversary of
the end of World War One – including Peter
Jackson’s unforgettable film They Shall
Not Grow Old – to the 58 million requests
to our live World Cup action online acrossBBC iPlayer and BBC Sport, we continued
to bring the country together in sharednational celebration or commemoration.

It was a real tribute to the range, ambition,and innovation on offer across BBC
Radio. On Radio 4, that meant Rabbi
Lord Sacks’ Morality in the 21st Century
as well as Jameela Jamil’s New Age ofConsent, looking at sexual consent in themodern age. On Radio 5 live it meant
bringing listeners news and stories fromevery part of the UK as well as producing
award-winning podcasts from That Peter
Crouch Podcast to You, Me & The Big C.

The fact that the BBC took home morethan half the awards on offer from theRoyal Television Society (RTS) says a
lot about our commitment to pushingcreative boundaries. I was particularly
pleased to see CBeebies win RTS Channelof the Year, following last year’s win for
BBC One. Most recently we celebrated 16
BAFTA television awards, recognising ourcreative excellence across an astonishingrange of programmes and performances.

Latest figures from the first quarter of2019 show that audiences are rewarding
BBC Radio for making some bold choices.
Zoe Ball has hit the ground running as
the new Radio 2 breakfast host as partof a refreshed schedule, while there was
new record reach for Lauren Laverne inher own new breakfast slot on 6 Music.
Meanwhile Radio 3 has introduced Jess
Gillam, former Young Musician finalist,
as its youngest-ever regular presenter.

The nation’s trusted guideThis year has of course been anotherhighly demanding one for BBC News.
Our teams in news and current affairs
have worked tirelessly to live up to their
responsibility as the nation’s trusted guide.
Brexit dominated the news agenda. It
proved once again that the BBC is the placeaudiences come to find out the facts andto understand what is really going on.
In January, almost 43 million UK browsers
came to BBC News online in the week of
the first ‘meaningful vote’ and subsequentconfidence vote in the government. Morethan 4 million people came to the live BBC
News Special on BBC One in March, as MPs
voted on the Prime Minister’s withdrawal
agreement – about as many as watched
Shetland or EastEnders that night.
I am very proud of the way our teams
have covered this vitally importantnational story. Our news and current
affairs output has included everythingfrom long reads to jargon busters, news
specials to Reality Checks; podcasts
from the brilliant Brexitcast to Nick
Robinson’s Political Thinking; in-depth
documentaries from Laura Kuenssberg’s
The Brexit Storm to Norma Percy’s
outstanding series Inside Europe.
It’s a sign of how determined we havebeen to deliver for our audiences overthe past year; to explain the news aswell as report it. We’re taking moretime to explore the context behind theevents – the why as well as the what.

Responding to our challenges
In March we published our Annual Plan
for 2019/20, which set out what we will
be doing in the months ahead to respondto the strategic challenges we face.
There is plenty of work now underway,
but we are focusing on four priorities
in particular:
Creativity at the heart of the BBC— Even more creative risks foraudiences, especially younger
audiences—

Greater diversity of voices, opinions,stories, geographies, and communities—

Go further and faster in our workoutside London—

See BBC Studios powering forwards
over the next 12 months

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Growing iPlayer and BBC Sounds— Transform iPlayer into a destinationin its own right

Making the BBC the best place to work
— Lead the way on gender pay, for ourindustry and society as a whole——

Create a more inclusive BBC andtackle the barriers to career
progression—

Drive progress towards our ambitious
diversity and inclusion targets

Firmly establish BBC Sounds as thebest place to listen to all BBC audio

Trust and impartiality in news
— Stand up for impartiality as acore value—

Make sure all sides of the debate
are heard—

More context and analysis at thecore of our coverage—

More fact-checking to take thefight to ‘fake news’

More details on these and all of ourstrategic priorities for reinventing the BBC
can be found in our Annual Plan 2019/20.

BBC Group Annual Report and Accounts 2018/19

11

ABOUT THE BBC

We think it’s increasingly vital in helping
audiences navigate today’s world.
We’re also standing up for impartiality
like never before. It’s one of the BBC’s
most precious assets, and the key
to our continued status as the UK’s
most trusted source of news by far.
We are working hard to strengthen
perceptions of our impartiality amongst
our audiences even further. That includes
refreshed editorial guidelines, new training
in areas like subconscious bias, an evergreater focus on accuracy, and even more
specialist, on-the-spot reporting fromjournalists like Katya Adler and Jon Sopel
who know their subjects inside out.
Taking the fight to fake news
A major priority this year has been to stepup the fight against fake news. The BBC’s
Reality Check has fast become one ofour most potent resources in taking on
misinformation and investigating claims andcounterclaims. Our goal is to make it more
central to our daily journalism – online, onradio, and on TV – so that audiences canbenefit from our fact-checking machinery,in real time, on every big story we do.
We have also deepened our commitment
to helping young people navigate
today’s news landscape. This year welaunched BBC Young Reporter, basedon our successful School Reportinitiative. We want to empower young
people to tell their own stories, develop
their media skills, and enhance theircritical thinking in the online world.

That’s why I am inviting media
organisations from across the world tojoin us for a special summit this summer.
The goal is to explore what we can dotogether to tackle the global rise of
misinformation, bias, and fake news. The
focus is very firmly on powerful, practicalmeasures we can all sign up to right now.
The UK’s voice to the world
This has been a landmark year for theBBC’s global services. The fact that wehave grown our weekly global audienceto 426 million is a sign not only of how
important a role the BBC plays for the UKabroad, but also of how uniquely valued
our services are by global audiences.
Thanks to new investment announced
by the government two years ago,
BBC World Service has completed its
biggest expansion in over 70 years.
It now operates in 42 languages,
from Korean to Punjabi to Pidgin, andhas increased its global audience by
40 million since last year, to 319 million.
Not only does this enhance ourcoverage and trusted news services
for audiences abroad, but it also
gives our UK news services a morein-depth view of areas which havetraditionally received less attention.

We believe the BBC can play a major rolein tackling the scourge of disinformation athome and abroad. But we also believe there
is a major opportunity for all those whoshare a commitment to integrity in news tocome together around their shared values.

BBC Sounds
BBC Sounds brings listeners thousandsof hours of unmissable music, radio
and podcasts, available live andon demand. Launched in October,it has had a great start with morethan 2 million app downloads.
BBC Sounds has opened up new creative
possibilities and through the range of new
podcasts we have given listeners different
sounding on demand content. Podcasts
such as That Peter Crouch Podcast,
The Ratline, The Sista Collective,

12

The Case of Charles Dexter Ward and Beyond
Today are just a few that demonstrate theunmatched quality and range of content
on BBC Sounds. As it’s personalised, andexpertly curated by BBC talent – BBCSounds gives listeners the choice andcontrol over what to listen to and when.
And, because users sign in to their BBC
account to use BBC Sounds, the morethey use it, the better it gets at making
recommendations based on what theylike, as well as introducing listeners to
new content.

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

iPlayer
2018 was a strong year for BBC iPlayer,with 3.6 billion programmes requested.

I’m really proud of how our BBC news
teams have this year brought light andinsight to parts of the world in which truth
can often lie hidden. BBC Africa Eye, forexample, whose painstaking analysis ofvideo footage from Cameroon provedthat the army had carried out killings ofcivilian women and their children. Or thecritical role our teams played in elections in
Nigeria and India, calling out fake news andfact-checking disputed issues in real time.
All of this plays a priceless role in helping
to support democracy and the UK’svoice, values, and influence around theworld. That’s why I am pleased that
we are now talking to the government
about extending its support for what the
BBC does overseas, including our BBC
World News channel on television.
Serving local communities
It is not only our global services thatmake the BBC unique. It is also what
we do locally, for communities rightacross the UK. This has become evenmore important at a time when it is
so important that all of the country’s
diverse views and voices are heard.
As others move away from local radio
programming and replace it with showsbased in London, we are investing more andcreating new shows on our local stations.
In total, we have launched more than 150
new shows in the evening with a diverse mixof presenters and themes. It’s helping to
make sure our local radio stations betterreflect the communities they serve.

Return to contents—

Thrilling drama Bodyguard was
BBC iPlayer’s biggest show of 2018,with the first episode smashingrecords to reach 10.8 million
requests – making it the mostpopular episode ever on BBC iPlayer.
And the overall series reached 42.6
million requests in 2018, becoming
BBC iPlayer’s biggest box set ever.

—

The first episode of the incredible
Killing Eve became the second-best
performing BBC iPlayer episodeever, with 9.2 million requests, whilst

With local journalism under such intensecommercial pressure, we have also been
looking at what more we can do to supporta healthy local media ecology. I am
particularly proud of our Local Democracy
Reporting Service, which supports a
network of up to 150 reporters, managed
by local media but funded by the BBC.
It’s a scheme that has succeeded beyond
all expectations, already distributing morethan 78,000 public interest stories thatmight not otherwise have been heard.
The Culture Secretary, Jeremy Wright,
has paid tribute to the scheme’s successand its contribution to local democracy,whilst the Cairncross report on the futureof UK media called for it to be extended.
I am also proud of how we have delivered
further on our priority of investing more in
the UK’s nations and regions. The launchof our new BBC Scotland channel, witha dedicated evening news programme
at its heart, is a great example of how
determined we are to serve and reflect
all our communities more closely.
We’re excited and encouraged by the start
BBC Scotland has made. During its firstmonth, the new channel reached more than
one in four of all audiences in Scotland
weekly. On its first night, the iconic sitcom

the series overall had 42.5 million
requests – the second biggest box
set iPlayer has ever seen.
—

Following the success of Ultra HD
trials for major series and events likeBlue Planet II, the FIFA World Cup
and the Wimbledon Championships,
BBC iPlayer brought landmark
natural history programme
Dynasties to viewers in Ultra HD.
In total, Dynasties was streamedaround 7.5 million times – with 19%of these requests (1.4 million) in
Ultra HD.

Still Game pulled in the highest-ever ratings
there for a digital channel. It’s part of theBBC’s biggest investment in content in
Scotland for a generation, and will see
hundreds of hours of newly-commissioned
programmes to reflect the national identity.
Transforming our digital services
This year our audiences have started toexperience what a reinvented BBC looks
and sounds like. October saw the launch of
BBC Sounds, allowing audiences to explore
all our music, radio, and podcasts – live
and on demand – in a single personalised
destination. It has made a great start, withmore than two million app downloads.
In particular, its first few months havedemonstrated the impact that ambitious
new podcasts can have. BBC Sounds
took home six golds from the recent
British Podcast Awards, including the
Listeners’ Choice award for Brexitcast
and best current affairs podcast for
The Grenfell Tower Enquiry. I’m proudthat podcasts on Sounds are opening
up exciting new creative possibilities,
as with the ground-breaking Forest 404.
We will keep developing the productand keep working hard to make sure it
delivers more and more value to users bybecoming more and more personalised.

BBC Group Annual Report and Accounts 2018/19

13

ABOUT THE BBC

On BBC Scotland’s
launch night Still Game
pulled in the highestever ratings there fora digital channel

This year we also set out our plans to helptransform BBC iPlayer from a catch-up
service into a destination in its own right.
We have already made considerable
progress. Compare BBC iPlayer today
to one year ago and you will see majorchanges to the product and user experience– from autoplay recommendations to live
programme restart on the green button.
We have also made big changes throughextending the availability of new titles,
giving people more time to discover andenjoy hits such as Bodyguard and KillingEve. Releasing box sets of back catalogues
to coincide with the launch of news series
such as Our Girl and Luther brought abrilliant response from audiences. And
the importance of our unique archive has
been brought home once again by the factthat shows like Two Pints of Lager and a
Packet of Crisps and Gavin and Stacey – now
returning for a Christmas special – areamongst iPlayer’s biggest comedy titles.
These changes are critical for us inaddressing the profound changes that
continue to be seen in how audiences– especially those under the age of 35– consume media. As we see decreases
across the industry in the amount ofbroadcast TV watched by this groupon the TV set, so those changes are

14

starting to be mirrored in all audiences.
So I’m pleased that this report shows a
BBC that is really getting to grips withthese challenges and setting ourselves
up to succeed in this new world.
A great place to work
Of course, reinventing the BBC is about
the changes we are making inside theorganisation as well as out. We aredetermined to ensure that the BBC
continues to be a great place to work.
This report sets out the real and tangible
progress we have made this year. Ourlatest pay disclosures, for example, show
how far the BBC has come in boostingfemale representation among our highestpaid stars on-air, with a projected maleto female split for 2019/20 of 55:45. Thisis a huge transformation from the 76:24
ratio seen when we first published the data
two years ago in 2016/17, and it means
we are well on the way towards reaching
50% women and 50% men on-air.
It’s change that audiences can see andhear every day – whether it’s Zoe Ball andSara Cox on Radio 2, Fiona Bruce chairing
Question Time or Emily Maitlis becoming
lead presenter on Newsnight. But thechange is not simply at the level of thehighest earners, it is all across our output.

BBC Group Annual Report and Accounts 2018/19

This year we have made seriously
impressive progress with our 50:50 projectto ensure an equal split between maleand female guests, contributors andexperts across news, current affairs anda range of topical programmes. Many ofour programmes have transformed theirapproach to representation, with nearly
three-quarters of teams signed up overthe past year reaching 50% by April 2019.
Overall, the BBC’s latest gender pay
gap report shows that we have brought
down our median gap from 7.6% in2018 to 6.7% in 2019. This represents
good progress, but continuing to close
the gender pay gap is a priority. We aredetermined to lead the way, not just forour industry, but for society as a whole.
To support this, we conducted this year
a review into gender culture and career
progression at the BBC. It produced
a series of detailed recommendations
to help remove barriers and bringabout a step-change in genderequality at the BBC. We undertook
to implement them all, and 97% are
now either complete or in progress.

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S T R AT E G I C R E P O R T

There is plenty more work underway tobuild more diverse, more inclusive, andmore open BBC. Since we conducted ourgender review, we have produced four
further culture and career progression
reviews focusing on what can be done
to remove barriers to progress among
disabled staff, staff from a black, Asianand minority ethnic (BAME) background,
LGBTQ+ staff, and staff from diverse
socio-economic backgrounds.
We are committed to implementing
their recommendations. Overall, 95%
are now completed or underway andour focus is now turning to making
sure the reports drive real change.
Our diversity targets in other areas arealso every bit as ambitious as those forgender, such as 15% BAME staff across the
BBC and in leadership roles by 2020. And
we are the only broadcaster who routinely
and voluntarily publishes our BAME pay
gap and figures for social diversity – wherearound 40% of our employees are from
low and intermediate income households.
This year, two independent reviews
concluded that the BBC – both in the
public service and in our commercial
operations – is one of the mosttransparent organisations in the
country, but recommended ways we
can go even further. Most recently, theNational Audit Office (NAO) publisheda report on pay which said that we are
well ahead of other organisations.

I am proud of the progress set out inthese pages. They demonstrate that thishas been an outstanding year for theBBC, in delivering our creative remit,
driving our commercial revenue, andperforming against our public purposes.
All this has been achieved against the
backdrop of the BBC’s tough financial
context. As these Accounts show, we
continue to manage our finances in as
prudent a way as we can: delivering
efficiencies of £153 million this year;
reducing our overheads to just 5%of our total costs; and maintaining
a strong cash surplus which enables
us to invest in content whilst also
managing our financial responsibilities.
Our commercial operations continued
to contribute significantly to our overallfunding too. A commercial group dividendof £73 million in 2018/19 serves tounderline the increasing importanceof this activity to the Group.
This year’s Accounts also set out the steps
we are taking to make sure we address
and put right any long-standing issues
around tax status for our presenters,some of whom have been heavily impacted
under the new rules applied by HMRC in
2017/18. We’ve thought long and hardabout the options here and taken into
account the impact on the tax statusof presenters affected in different ways
by HMRC’s changes. On that basis, we
agreed with the Board that our proposed

approach – set out in more detail in
the Chief Financial Officer’s review on
page 88 – is the right one to draw a line
under these issues in as fair, efficientand cost-effective way as possible.
Finally, last month we announced theBoard’s decision on the future of free TV
licences for the over-75s. This followed afull and thorough consultation with the
public that we undertook this year. We
decided to move to a system where, from
June 2020, free TV licences are available
for any household where someone over 75
is in receipt of pension credit. We believethat this is the fairest option to help thepoorest pensioners. We also believe it is
the fairest option for all licence fee payers– old and young – as it means the BBC
will continue to deliver the programmes
and services we know they value.
This report gives me great confidence for
the BBC’s future. I believe we are well on
track in our project of reinventing the BBC
for a new generation. And I am convinced
there is an opportunity for a strong, thriving
BBC to do more than ever for our audiences
and the UK as a whole in the years ahead.

Tony Hall, Lord Hall of Birkenhead CBE
Director-General and Editor-in-Chief
20 June 2019

The NAO report also confirmed that weare at the forefront of the media industry
when it comes to the gender pay gap.
And it paid tribute to the reforms wehave made in recent years, saying that
we have taken “big steps in improving
consistency and fairness” of our pay
and terms and conditions. We havecome a long way. Our goal is to build
on all this work and go further, faster.

£153m

Radio 5 live’s award-winning podcast, Brexitcast

Efficiency savings delivered in 2018/19

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BBC Group Annual Report and Accounts 2018/19

15

DELIVERING OUR PUBLIC PURPOSES

Delivering
our creative
remit
The BBC’s public
purposes are enshrinedin the Royal Charter andAgreement and are at thecore of everything we do.

The public purposes outline the values we holdwhen striving to achieve our mission to inform,
educate and entertain and they provide a clear
framework through which we are held to account.
The following pages set out how we have met
the requirements of those public purposes.
Of all the media providers (TV, radio, newspaper, magazine, website,
app or social media), which one does the most to/has the most...
BBC (%)

Nex t nearest provider (%)
60
51

50

8

6
b

c

d

8

7

6
e

ITV

ITV

ITV

YouTube= ITV/Sky11f= ITV/Sky

38

6
a

50

45

43
YouTube= Facebook/Google

50

5

g

h

a. Help people in the UK understand and engage with the world around themb. Help people in the UK learn new thingsc. High quality content and services for people in the UK
d. Creative content and services for people in the UK
e. Distinctive content and services for people in the UK
f. Content and services relevant to people in the UK
g. Reﬂect life in diﬀerent parts of the UK
h. Reﬂect the UK around the world
Source: Ipsos MORI for the BBC, 3,551 UK adults 16+, March-May 201916

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

1. To provide impartial news and information
to help people understand and engage
with the world around them

Read more on pages 18-21

2. To support learning for peopleof all ages

Read more on pages 22-25

3. To show the most creative,
highest quality and distinctive
output and services

Read more on pages 26-33

4. To reflect, represent and serve thediverse communities of all of the United
Kingdom’s nations and regions and, in
doing so, support the creative economy
across the United Kingdom
Read more on pages 34-47

5. To reflect the United Kingdom,
its culture and values to the world

Read more on pages 48-54
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BBC Group Annual Report and Accounts 2018/19

17

DELIVERING OUR PUBLIC PURPOSES

1

To provide impartial news
and information to help people
understand and engage withthe world around them

The first purpose of the BBC is to inform.
In tumultuous times, the BBC’s role inproviding news and information that canhelp audiences understand the worldand engage with key events is more
important than ever.
Today, the BBC provides an unrivalled
level of local, regional, national andinternational news and current affairs.
We remain the most trusted sourceof news in this country and the mostchosen for impartiality. But the news
landscape around us has undergone
some profound changes in recent years.
Trust is at a premium. There has been
an increase in scepticism about experts,
elites, and institutions. Generational,
political and social differences havewidened markedly, and our society feels
more fragmented and divided. Politicalpartisanship has grown and technology
and social media have contributed toa polarisation of our national debate.
‘Fake news’ has blurred the line
between facts and disinformation andundermined faith in traditional media.

In this environment, it is no surprise that
scrutiny of the BBC’s impartiality has
intensified. As the data in this reportdemonstrates, we need to do more toshow that the BBC is effective in providing
impartial news and current affairs that canhelp audiences make sense of events. For
us, impartiality is one of our most precious
assets. It is part of our enduring contract
with audiences. Reporting without fearor favour and making sure all sides of adebate are heard – all different views andvoices – is fundamental to our mission.
This year we have continued to provide
trusted and reliable information, news,
current affairs and factual output
to the highest editorial standards.
We have sought to reach and serve
all audiences with this output, tocontribute to a better-informed society,a more engaged citizenship, and aworld of greater understanding.
We have shown that we are determined
to stand up for impartiality and defend
our role like never before. It is essential
if we are to continue to be the place
people know they can come to hear
the broadest range of views, andunderstand what is truly happening
in the UK and around the world.

8/10

17/18

8/10

Pan BBC News reach
Number of UK adults (16+) who use
BBC News services each week.
Source: Kantar MediaBBC News sets a high standard
for quality

BBC News reach by platform

BBC TV Network Newsand Current Affairs

60%

17/18

63%

% of UK adults (16+) who watch BBC TV
Network News and Current Affairs eachweek.

BBC TV

38%

17/18

39%

% of UK adults (16+) who listen to news
and current affairs programmes on BBC
Network Radio each week.
(Source: RAJAR, reach based on 15+mins,
excludes bulletins that are not part of a news
or current affairs programme)(For the % of adults who listen to BBC Radiostations dedicated to the nations and regionsof the UK, see pages 41, 43, 45, 47)

BBC News Online

18

33m

17/18

30m

BBC Radio

BBC Group Annual Report and Accounts 2018/19

78%

78%

17/18

80%

weekly users saying
effective (ineffective 8%.
17/18: 6%).
BBC Online

Average number of unique UK browsers
accessing BBC News Online each week.
(Source: Abode DAx. 2018/19 figure based on
April 2018 to February 2019 owing to a change
in measurement)

17/18

weekly users saying
effective (ineffective 8%.
17/18: 8%).

(Source: BARB, reach based on 3+mins)(For the % of adults who watch dedicated
BBC TV news for the nations and regionsof the UK, see pages 41, 43, 45, 47)

BBC Network RadioNews and Current
Affairs programmes

75%

80%

17/18

82%

weekly users saying
effective (ineffective 8%.
17/18: 7%).
Source: Ipsos MORI

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S T R AT E G I C R E P O R T

Of all the news sources (TV, radio,
newspaper, magazine, website, app
or social media) which one source
are you most likely to turn to…

… if you want impartial news coverage

44%

BBC
ITV
Sky
Channel 4
Other
None
Don’t know

… for news you trust the most

70%

17/18

73%

62%

17/18

64%

% of UK adults who think BBC Newsand Current Affairs is effective at
helping them understand what ishappening in the UK/world today(ineffective 15%. 17/18: 12%).

% of UK adults who think BBC Newsand Current Affairs is effective at
helping them understand what ishappening in their part of the UK(ineffective 18%. 17/18: 15%).

Source: Ipsos MORI

Source: Ipsos MORI

62%

52%

17/18

65%

% of UK adults who think BBC Newsand Current Affairs is effective at
informing them about the day’s issues
so they can make up their minds(ineffective 17%. 17/18: 14%).

51%… if you want accurate news coverage

17/18

54%

% of UK adults who think the BBC iseffective at providing news andcurrent affairs that is impartial(ineffective 28%. 17/18: 26%).

BBC
ITV
Sky
Guardian
Other
None
Don’t know

53%

BBC
ITV
Sky
Guardian
Other
None
Don’t know

Source: Ipsos MORI

Source: Ipsos MORI
Source: Ipsos MORI, 1,829 UK adults 15+ who follow
the news, April-May 2019.

BBC Two’s new daily political programme, Politics Live
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BBC Group Annual Report and Accounts 2018/19

19

DELIVERING OUR PUBLIC PURPOSES

Delivering impartial
news and information

One topic dominated the UK news
agenda. Brexit was the year’s biggest
story, bringing audiences to the BBC
in their millions.
From Reality Checks to jargon-busters
to in-depth documentaries to podcasts,
BBC News focused on explaining Brexit to
our audiences. Specialists such as politicaleditor Laura Kuenssberg and Europe editor
Katya Adler played a crucial role in giving
the context to help audiences navigate anoften complicated and confusing story.
At the end of 2018, in the week of thevote of confidence in the Prime Minister,
close to 38 million UK browsers came to
the BBC News website and app, making
it the biggest week of the year. Thiswas surpassed in January 2019, whenalmost 43 million UK browsers cameto BBC News online in the week of thefirst meaningful vote, and subsequentconfidence vote in the Government.
The BBC Parliament channel saw recordbreaking figures, with recent daily
audiences for crucial votes ranking in the
top five biggest days of the past decade.
The irreverent but analytical Brexitcast
podcast, a collaboration between Radio 5
live and BBC News, proved a big success.

Despite these challenges, BBC News
remains the most trusted source foraudiences: when people are asked
to pick the one source they turn tofirst for the news they trust the most,
BBC News is chosen most often, by
51% of audiences – five times morethan the next nearest source (ITV).

We also appointed the BBC’s first LGBT
correspondent, who will be reportingon stories about sexuality and gender.

Of the year’s international stories coverageof the cave rescue of the Thai football team
generated huge interest in the UK. Our firston-air Africa editor Fergal Keane broughta heightened profile for stories fromthe continent, reporting from countries
including Zimbabwe, DRC, Sudan andMozambique. Other international highlights
included powerful reporting on the demiseof IS and the collapse of the Caliphate.
UK news services have also benefited
from the investment in the BBC
World Service which has meant new
and upgraded bureaux overseas.
We continued the drive to make BBC News
more relevant and appealing to younger
audiences, putting a focus on topics
which we know are of particular interest
to them – such as mental health.

We’ve expanded the range of voices on-air.
The proportion of female contributors
on BBC programmes has radicallyincreased, thanks to the success of our
50:50 project, a grassroots initiative thatstarted within the News division. Nearly
three-quarters (74%) of teams monitoring
their output for 12 months or moreachieved an equal balance of female andmale contributors on-air in April 2019.
In September, we launched a new daily
political programme, Politics Live.
From its inaugural episode, which washailed for fielding an all-female panel,
Politics Live has offered a modern andaccessible take on British politics andhas been showcasing new voices.
There was also change on our flagshipdebate show, Question Time, withveteran host David Dimbleby stepping
down after a quarter of a century at
the helm. New presenter Fiona Bruce
started on the show in January andwon praise for her interviewing style.

Overall, BBC News reached a weekly
average of over 80% of adults in the UK,
and over 70% amongst young audiences
aged 16-34. BBC News online also
continued to attract over 32 million UK
browsers a week on average in 2018.
Impartiality continues to be thecornerstone of BBC News, but weare operating in a changing context,
with increasing partisanship andfragmentation in politics and the media
which puts public perceptions underpressure. We have started the work ofreasserting our belief in the core valueof impartiality across our news output.

20

BBC Group Annual Report and Accounts 2018/19

David Dimbleby presented
his last ever Question Time,and new host Fiona Bruce
became the show’s firstfemale presenter.

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S T R AT E G I C R E P O R T

43m

BBC Parliament

UK browsers came to BBC News online
in the week of the first meaningful vote

We continued to investigate news
outside the mainstream agenda toconnect better with audiences across thecountry, reporting from our first ‘popup bureau’ in Bradford, a project thatwill continue in other towns and cities.
Victoria Derbyshire continued to break awide range of stories, investigating topics
from the abortion pill to the mistreatmentof male infertility to children’s suicides
in the Moria refugee camp, which led toan urgent investigation from the UN.
Outside broadcasts took the show
– and viewers – into locations rarely
explored on television, such as a Pupil
Referral Unit and a women’s refuge.
The 70th anniversary of the NHS wascovered extensively across our output,
notably by BBC Breakfast who took theirwhole programme to a hospital in Leeds.
From the largest national newsroom
outside London, BBC Radio 5 live has
visited every corner of the UK to findout how businesses and communities
are preparing to leave the EU, as well as
hearing listeners’ views in programmessuch as 5 Live Breakfast and Your Call.
5 live also staged the UK’s biggest
conversation about sex and relationships
in collaboration with the University ofSunderland, focused on environmental
issues in a year-long Cool Planet season
and launched The Sista Collective, a
new podcast looking at life in the UK
through the lens of women of colour.

Return to contents

Current Affairs added insight and depth on
the biggest stories. On Brexit, Panorama
took viewers to Chequers for an exclusive
interview with the Prime Minister, whilst
on BBC Two, Inside Europe: 10 Years of
Turmoil gave viewers a unique insight
into the workings of the EU, as told by
an impressive roster of Heads of State.
Newsnight covered the daily twists andturns of UK and international politicalevents, and secured interviews with
big names such as James Comey.
We investigated global issues with editionsof Panorama focusing on President Putin
and President Trump. On BBC Two, Lyse
Doucet chronicled the war in Syria in a
multi-part documentary. The This World
strand focused on remarkable stories
illuminating the position of women in
the world, from the Chibok girls, to thestory of Sheikha Latifa of Dubai. And
Ade Adepitan travelled across Africa toreport on how the continent is changing.
Closer to home, Panorama secured
exclusive interviews with the police
officer poisoned in the attack on Sergei
and Yulia Skripal. Radio Current Affairs
continued its daily podcast reportingfrom the Grenfell Tower Inquiry, and on
BBC Two, we examined The Fires That
Foretold Grenfell. File on 4 reported on
the issue of care for people with learning
disabilities, provoking national debate.

With drama, intrigue and jeopardy,
BBC Parliament became the surprisestandout hit of the year thanks to thetwists and turns of Brexit. With theincreased activity in Westminster,
the channel saw record-breaking
audience figures, reaching more than
3.5 million people in January. The
daily audiences for the big votes on
Brexit all ranked in the top fivebiggest days for BBC Parliament overthe past decade. The action was
supported by expert commentaryduring the votes from BBC
Parliamentary correspondent MarkD’Arcy and Dr Ruth Fox of the
Hansard Society to give viewers aguide to what was taking place andwhat to look for. BBC Parliament
launched in 1998 and broadcasts live
the proceedings of the House ofCommons as well as providing
coverage of the House of Lords,
committee hearings, the Scottish
Parliament and the Welsh andNorthern Irish Assemblies. It also
makes its own programmes, often
drawing on archive, and a daily reporton what’s happened in Parliament.

On BBC Three, Current Affairs continued to
produce high impact and innovative work,
including a documentary on R Kelly, and theseries Love and Drugs on the Street which
focuses on the lives of homeless women.
We are focusing on the next generationof both audiences and journalists through
BBC Young Reporter’s work with schools,
colleges and youth organisations acrossthe UK. The project unearths uniquestories, gives young people media skills
and aims to encourage young people
into the media industry. The challengeof navigating news and helping young
audiences identify real news and filter out
false information is core to this work, withfree online resources, classroom activities
and BBC staff-led workshops being offeredto 3,500 schools and youth organisations.
The inaugural BBC Young Reporter
competition saw more than 1,500 11-18
year olds submit stories that are relevantto their lives and that they think the BBC
should be reporting. Twelve finalists
produced their stories with teams fromacross the BBC – they were broadcast
across programmes and platforms
including The One Show, BBC Breakfast,
the News at Six and BBC Three.

BBC Group Annual Report and Accounts 2018/19

21

DELIVERING OUR PUBLIC PURPOSES

2

To support learningfor people of all ages

Education has always been in the DNA of
the BBC. It was right at the heart of our
founding mission: to inform, educate, andentertain. Today, that mission still guides
us every day. And perhaps nothing better
illustrates our ability to inform, educate,and entertain all at the same time thanthe programmes and services we offer thenation’s children.
For almost a century, generation aftergeneration has grown up with the BBC
as a constant companion and trusted
source of information and inspiration.
Our children’s output helps our youngest
audiences to develop their reading, learningand social skills in ways that are exciting,playful and fun. As they grow and change,
BBC Children’s content grows and changes
with them. It fires their enthusiasm andallows them to discover their passions.
It helps them navigate the world aroundthem and inspires them to learn. All
the while, it keeps them entertainedin an environment that is defined byvalues of quality, safety and trust.
Today’s generation of children are born
digital. We need to make sure we canreach and support them where they are –online – and serve them with our education
mission in new and different ways. In
particular, as this report highlights, weneed to make sure that young children
keep choosing the BBC as they grow into
young teens and young adults. In a world of
so much choice and competition for theirtime and attention, we need to ensure all
young audiences can continue to discover
everything on offer from the BBC.
In 2017, we announced our biggest
investment in children’s content andservices in a generation: an additional£34 million over and above existing
budgets to help us reimagine how we serve
our youngest audiences. These pages
show how this investment is bearing fruitand benefiting our younger audiences.
They also show how, as we work to reinvent
the BBC, we have continued to transform
what we do in education to support
learning for people of all ages. Our goal
is to enable everyone, whatever theirstage of life, to achieve their full potential
through educational content, services
and participative experiences from theBBC, from partners and from each other.

81%

17/18

83%

Under 16s reach% of under 16s who use BBC
Television, Radio or Online each week.
Source: Ipsos MORI

7/10

17/18

7/10

Perception of BBC by under
16s: mean score out of 10.
Source: Ipsos MORI

CBeebies Christmas show Thumbelina
22

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

65%

17/18

67%

% of UK adults who think
the BBC is effective at
helping them learn newthings (ineffective 16%.
17/18: 14%).
Source: Ipsos MORI

61%

17/18

62%

% of parents who think
the BBC is effective at
supporting children
and teenagers with theirlearning (ineffective: 14%.
17/18: 9%).
Source: Ipsos MORI

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BBC Group Annual Report and Accounts 2018/19

23

DELIVERING OUR PUBLIC PURPOSES

Delivering learningfor people of all ages

CHILDREN’S
Thanks to the internet, children today
have more media choices than ever – more
content, across more platforms that are‘always on’. However, there has not been
the same explosion of content which isoriginated in the UK, aimed specifically at
young UK viewers, and which reflects thenational diversity and voices of British
children. As the country’s biggest
investor in home-grown content, thisgives the BBC a unique role in children’s
lives – but a challenging one given the
choice available to them, and the scaleof some of our competitors.

2x

We are adapting to the world in which
our born-digital children are now
living, whilst maintaining our mission
to inform, educate and entertain them.
Thanks to 2017’s additional investmentof £34 million over three years, in thelast 12 months we have been able toexperiment with and create new forms ofcontent. We have launched two new apps
for CBeebies, Get Creative and Go Explore,
and also produced our first Voice content.
For CBBC-aged children we launched
the participative Buzz app, and answered
their desire to consume our shows on
demand by commissioning the iPlayerfirst shows Logan High and The A List.
Similarly, the new investment has
also allowed us to experiment withserving young teens better – again bycreating content for iPlayer such as
the series Nine to Five and Teen Taxi,
which the audience can consume on
demand in the way they want to.
Despite the pressure that online media
has put on TV, our channels still continue
to be the main platforms for viewing andthey lead amongst all other children’s
TV channels in the UK for their target
audiences. Looked at in the round acrossBrowsers to the Newsround website
have doubled in a year.

TV, BBC iPlayer and online CBBC has
an average weekly reach of 24% among
0-15s, whilst for CBeebies this is 48%.
Last October on CBBC we were delighted
to celebrate the 60th anniversary of Blue
Peter – the longest-running kids’ TV show inthe world, and still loved by children today.
We are also proud of the unrivalledbreadth of programmes that we offer,across all genres from drama to factual,
comedy to the performing arts, and fromentertainment to news. Each channel
has a range of titles too long to list
here, but standout content for CBeebies
included the Something Special Prom, newdrama Molly and Mack and the launchof Baby Club which uses play, songs andstories to help families share precious
time with their babies and toddlers.
CBBC saw another strong year of dramas
including Katy and Jamie Johnson, thebuilding of high-quality factual hits
like Operation Ouch and My Life, andthe continuing evolution of Newsroundwhich has adapted its online offer tofeed our audience’s passion to know
more about the world around them.
Reaching out beyond the screen, lastAugust in Liverpool The CBBC Summer
Social was our first ever festival. Over
20,000 people engaged in immersive
experiences, saw live performanceand got to meet their favourite stars.
In the same way, our ever-popular
CBeebies Christmas show this year wasable to reach audiences on TV, iPlayer
and in cinemas with Thumbelina.

48%
Over 20,000 people attended
The CBBC Summer Social
festival in Liverpool

24

BBC Group Annual Report and Accounts 2018/19

Average weekly reach of CBeebies
Brand reach across TV, iPlayer andOnline among 0-15s.
Source: Ipsos MORI

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S T R AT E G I C R E P O R T

LEARNING
Over the last year we have madesignificant progress in delivering our
public purpose to support learning forpeople of all ages at the BBC.
BBC Bitesize
At the heart of our education strategy
is Bitesize. Now into its 20th year, it
continues to be one of the most popular
educational websites in the UK. 75% of
secondary aged students and 40% ofprimary aged students use it to help with
their study, revision and homework, linked
to the curricula of each devolved nation.
Over the past two years, Bitesize has
undergone a significant transformation
to enable us to personalise learning
through improved functionality andnavigation. This necessary overhaul has
resulted in some reduction in weeklybrowser reach compared with 2017/18
as we have migrated and replaced
content on deprecated platforms.
We will continue to evolve the service
over the coming year to improve theuser experience, grow audiences andfurther increase educational impact.
Another significant development has been
the introduction of new non-curriculum
content to better address the wider needsof young people. Working closely withorganisations such as the Confederation of
British Industry, the Careers and EnterpriseCompany and the Gatsby Foundation,
we have created an extensive Bitesize
Careers offer to open up the world ofwork. And we have also added a support
section with material aimed at helping ouraudience deal with a range of wider needsfrom exam stress to resilience building.
BBC Teach
BBC Teach provides curriculumlinked video and audio clips, Live
Lessons and supporting content forteachers to use in the classroom.
Both awareness and reach of the BBC
Teach website increased considerablycompared with the previous year.
Educational campaigns
Our main educational campaign in 2018/19
was Super Movers, a major partnershipwith the Premier League and the Scottish
Professional Football League, intended
to inspire primary children to become
more active. Hundreds of short ‘brain
booster’ videos and other resources
have been created for both teachers andparents. By January 2019 Super Movers
videos had been used by a quarter (25%)
of primary school teachers surveyed andthe majority of these teachers (76%) told
us they were using the activity videos
with their students on a weekly basis. In
addition, football clubs across the UK
have introduced Super Movers as partof their work in their communities.

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100k

We produced our first Voice
content and launched two new
apps for CBeebies, Go Explore
and Get Creative

visits to the Get Creative app a week

In 2018 we concluded Terrific Scientific,
our science campaign for primaryschools delivered in partnership with
Wellcome and more than 20 academic
institutions. Its aim was to inspire primaryschool pupils to get hands on with
science. Almost 9,000 schools engaged
with the initiative and although thecampaign has now finished, resources
created for it are still available to use.
We have also made significant progressin developing our plans to help address
the language and communication gap
amongst pre-school age children. In 2018,
we set out this ambition and believe thatthe BBC is uniquely placed to help address
this challenge. Throughout 2018/19 wedeveloped and tested our proposition,
working closely with organisations suchas the National Literacy Trust and Public
Health England. Our initial evidence
suggests that the BBC can play a keyrole and we will continue to work closelywith partners to build our plans.

40%

17/18

41%

In March 2019, we celebrated the 50th
anniversary of the Open University (OU)
and the unique partnership we have toencourage learning for all. Each year,
the OU invests in 12-15 BBC projects;
in 2018/19 these projects included
Blue Planet Live, The Secret Story of Stuff,
The Prosecutors, Big Life Fix and 5 Billion
Pound Super Sewer. In every case, notonly does the OU look to extend thelearning opportunities presented bythese programmes, but also inspireviewers to take up new careers. For
example, The 15 Billion Pound Railway
showcased a wide range of jobs andapprenticeships and there was a significant
rise in applications to become nurses
after the transmission of Hospital.

75%

17/18

78%

Bitesize: reach % pupils% of primary school pupils
who use Bitesize.

Bitesize: reach % pupils% of secondary school pupils
who use Bitesize.

Source: YouGov

Source: YouGov

58%

17/18

64%

82%

17/18

82%

Bitesize: % of secondary school
users who say Bitesize helps themto achieve better grades.

Bitesize: % of under 16 users
who say Bitesize helps themwith their schoolwork/homework.

Source: YouGov

Source: YouGov

BBC Group Annual Report and Accounts 2018/19

25

DELIVERING OUR PUBLIC PURPOSES

3

To show the mostcreative, highest qualityand distinctive output
and services

The BBC is here to make great
programmes and services, and that iswhat audiences love from us. It is why
they value us. This year we have once
again demonstrated our commitment tomaintaining the highest production andeditorial standards across the broadest
range of output. Above all, we havecontinued to put British creativity,
quality and risk-taking at the heart ofthe BBC.
The following pages demonstrate how wehave delivered this purpose. Our reportingis broken down by genre – factual, arts,
drama, entertainment, comedy, sport andmusic – and demonstrates that the rangeof our output on TV and radio is uniquein its distinctiveness and in its focus on
British content from across the UK.
This commitment to home-grown British
content is more important today than everbefore. The market around us has become
increasingly competitive and global, andmore and more dominated by huge, USbased players and their massive budgets.
We know UK audiences enjoy the quality
and breadth of choice the huge global
players bring, but we know they also
want British content that speaks to them
directly about their day-to-day lives;content that is at risk of being squeezed
out of today’s global marketplace.

This report underlines that, as themedia industry changes rapidly, the time
people spend with the BBC is trending
downwards year-on-year for both TV andradio. But it also reminds us that the BBC
remains the media provider that UK adults
overall use the most. And that, when
we deliver brilliant, distinctive British
content, audiences of all ages respond.
This year we have continued to invest
in new and original content made allover the UK, taking creative risks whilst
maintaining a balance between new series
and returning favourites. Our output
across all genres has sought to represent
and reflect all audiences, wherever they
are in the country. Their perspectives
and voices. Their passions and concerns.
Their places and communities.
This commitment to distinctive, highquality, home-grown content will continue
to set the BBC apart in the global
media landscape. Our role is to remain
the bastion of brilliant British content,
and the cornerstone of the creative
industries that allow this country topunch well above its weight worldwide.

BBC quality and distinctiveness by platforms

BBC TVBBC Radio

BBC Online

Sets a high standard for quality

Distinctive

72%

69%

17/18

72%

17/18

68%

weekly users saying effective(ineffective 9%. 17/18: 7%).

weekly users saying effective(ineffective 10%. 17/18: 8%).

75%

73%

17/18

81%

17/18

77%

weekly users saying effective(ineffective 7%. 17/18: 6%).

weekly users saying effective(ineffective 8%. 17/18: 7%).

69%

64%

17/18

74%

weekly users saying effective(ineffective 8%. 17/18: 6%).

17/18

70%

weekly users saying effective(ineffective 9%. 17/18: 6%).

Source: Ipsos MORI

Multi award-winning drama Killing Eve
26

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

78%

17/18

80%

% of UK adults (16+) in TV
homes who watch BBC TV
each week.
Source: BARB

07:36

17/18

08:16

Length of time UK adults(16+) in TV homes spend
with BBC TV each week
(hh:mm).

63%

17/18

64%

09:33

17/18

10:03

% of UK adults (16+)
who listen to BBC Radio
each week.

Length of time UK adults(16+) spend with BBC Radio
each week (hh:mm).

Source: RAJAR

Source: RAJAR

Source: BARB

70%

17/18

72%

64%

17/18

66%

% of UK adults who think
the BBC is effective at
providing content/services
that set a high standard for
quality (ineffective: 12%.
17/18: 11%).

% of UK adults who think
the BBC is effective at
providing content/services
that are distinctive(ineffective: 13%.
17/18: 12%).

Source: Ipsos MORI

Source: Ipsos MORI

65%

17/18

65%

% of UK adults who think
the BBC is effective at
providing quality content/
services that set a highstandard for creativity(ineffective: 14%.
17/18: 13%).

63%

17/18

64%

77%

17/18

75%

% of UK adults (18+) who
use BBC Online each month.
Source: Comscore MMX MultiPlatform, ONS See note on
page 39

67%

17/18

69%

% of UK adults who think
the BBC is effective at
providing content/services
that set a high standard fororiginality (ineffective: 14%.
17/18: 14%).

% of UK adults who think
the BBC is effective at
providing content/services
that cater for a wide rangeof tastes (ineffective: 14%.
17/18: 13%).

Source: Ipsos MORI

Source: Ipsos MORI

Source: Ipsos MORI

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BBC Group Annual Report and Accounts 2018/19

27

DELIVERING OUR PUBLIC PURPOSES

Delivering creative, high quality anddistinctive output and services

FACTUAL
Encompassing moments of national
importance, landmark factual series,
new formats and outstanding one-off
documentaries the BBC once again
commissioned an unparalleled range
and breadth of factual programmes
across our services.
Science and Natural History
Dynasties with Sir David Attenboroughhad audiences gripped with its uniqueexploration of five extraordinary animals’
struggles against rivals and the forcesof nature, as they fought for their own
survival and the future of their dynasties.
The future of the natural world was also
explored in Drowning in Plastic as Liz Bonnin
investigated the danger of plastics in our
oceans. Whilst Blue Planet Live and Blue
Planet UK offered a health check on thestate of the oceans around the world andback home in the UK. For more informationon the BBC’s work on environmental
sustainability, please see page 63.

BBC Radio 4’s All in the Mind explored
the BBC Loneliness Experiment – thebiggest conducted survey on lonelinessand the impact it has – as well as possible
solutions for individuals and public policy.
The Infinite Monkey Cage marked its 100th
episode with a special filmed recording
and alongside The Life Scientific continued
to examine topical scientific subjects.
Contemporary documentaries
BBC One broadcast two of the mosttalked about documentaries of theyear. A three-part series examining themurder of Stephen Lawrence, Stephen:
The Murder That Changed a Nation, anda personal film from Patrick Kielty about
the Northern Ireland peace process
entitled My Dad, the Peace Deal and Me.
And demonstrating a commitment tofeature-length documentaries in peak,the channel broadcast the award-winning
Grenfell which was filmed in the year
after the devastating tower block fire,
hearing from those directly affected.

Marking the 70th year of
the BBC Reith Lectures
Professor Margaret MacMillan gave
five lectures on the relationshipbetween war and humanity, examining
the role of war in relation to societal
changes and the psychology ofindividuals and groups.

Tara and George followed the lives of two
people in their late forties who sleep roughand as part of the series the programmelooked at why so many homeless people
are dying on our streets. Whilst Radio 5
live brought listeners stories from every
corner of the UK, such as in the run-up
to Brexit, exploring how businesses andcommunities are preparing to leave the EU.
And there was critical acclaim for
The Last Survivors, a landmark
documentary about the last survivors ofthe Holocaust living in Britain today.
Looking overseas A Dangerous Dynasty:
House of Assad won plaudits for its complex
study of the Assad dynasty and there wasan exploration of contemporary America
in Travels in Trumpland with Ed Balls.

The BBC’s coverage of The Royal
Wedding between Prince Harry andMeghan Markle drew a peak audienceof 13.6 million people to BBC One andwon the Royal Television Society’saward for Best Live Event.

28

BBC Group Annual Report and Accounts 2018/19

BBC Three continued to tackle
challenging subjects with documentaries
including Killed by My Debt, Love andDrugs on the Street, Stacey Dooley
Investigates, Is this Sexual Harassment?,and Alt-right: Age of Rage.
Whilst on BBC Four the Storyville strand
continued offering audiences someof the most distinctive and importantfeature-length documentaries made thisyear, such as The Trial of Ratko Mladic.
Ambulance returned to BBC One,providing a revealing insight into
the life of the ambulance service,and on BBC Two Hospital examinedthe current state of the NHS.
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S T R AT E G I C R E P O R T

BBC Four’s Soon Gone:
A Windrush Chronicle

BBC Arts New
Performance Strategy

On a lighter note, Babies: Their Wonderful
World, The Misadventures of Romesh
Ranganathan and Race Across The World
demonstrated the breadth of BBC Twocontent and were particularly popularwith young audiences, whilst Glow
Up: Britain’s Next Make-Up Star was a
successful new launch for BBC Three.
History
As we commemorated the 100th
anniversary of the end of the First World
War, Peter Jackson’s extraordinary film
They Shall Not Grow Old was superbly
received by both audiences and critics.
The centenary of women’s suffrage wasmarked with the critically acclaimed
BBC Four drama Snatches: Momentsfrom Women’s Lives – a BBC Arts
partnership with the Royal Court Theatre.
On BBC One, BAFTA award-winning
Suffragettes with Lucy Worsley used
dramatised testimony to tell the storyof women campaigning for the vote.
On Radio 4, Misha Glenny presented
the latest programmes in The Invention
of… series, which this year looked at
the history of Britain, our borders, ourpeople and the stories we tell ourselves.
Religion and ethics
In a major series on Radio 4, Rabbi Lord
Sacks examined morality in the 21st
century, exploring some of the mostimportant issues of our day with thebiggest global thinkers as well as a groupof young people who discussed what
morality meant for them in real terms.
Radio 4’s long-running programmes Sunday
and Beyond Belief continued to explore
the place of belief in today’s world, whilst
Moral Maze debated the ethical issues
behind topical subjects. On BBC Two We
are British Jews explored what it means to
be Jewish in Britain today and in New Ageof Consent, Jameela Jamil looked at sexualconsent in the modern age on Radio 4.

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In January, we launched the BBC’s Yearof Beliefs, shining a light on faith, belief
and values in modern Britain across TV,
Radio and online throughout 2019. As partof this on BBC Two Pilgrimage, the Road
to Rome saw eight well-known peopleof differing faiths and beliefs travel toRome for a private audience with thePope. On Radio 4 ten-part series Fatwa
told the hidden story of the 1989 fatwa
issued against Salman Rushdie, exploringrace relations in Britain, identity, freespeech and the connection between the
fatwa and contemporary violent jihad.

ARTS
BBC Arts commissions programmes andsupports artists, and arts organisations,
to appeal to the widest possible audience.
BBC One brought big audiences to arts withBig Painting Challenge, Fake or Fortune andImagine. Whilst topical arts panel discussion
programme Front Row Late presented by
Dame Mary Beard returned to BBC Two.
Simon Frederick’s RTS nominated Black
Hollywood: They’ve Gotta Have Us exploredthe rise of black talent in Hollywood
and other documentaries profiled theunique lives of Billy Connolly, Raymond
Briggs, Germaine Greer and artist Egon
Schiele. Whilst Arena: Nothing Like A Dameoffered an award-winning celebration of
our most iconic actresses: Dame Eileen
Atkins, Dame Judi Dench, Dame Joan
Plowright and Dame Maggie Smith.
Thirty years since the creation of the World
Wide Web was marked with programmingthat explored the many different facets ofan invention that completely changed theworld as we know it. Highlights included a
television adaptation of Javaad Alipoor’saward-winning, critically acclaimed
play, The Believers Are But Brothers.

As part of an enhanced performance
strategy bringing the best of British
performing arts to a wider audience,
BBC Arts commissioned an
ambitious range of new works withleading artists and companies thatshone a light on unheard and often
under-represented stories. This
included Snatches: Moments from
Women’s Lives (BBC Four) with theRoyal Court; Soon Gone: A Windrush
Chronicle (BBC Four) with the Young
Vic; and LOVE (BBC Two) by
Alexander Zeldin in partnership with
Arts Council England, BBC Films andthe National Theatre. There werealso many unique productions fromindependent artists across the UK
like Tourettes Hero, Javaad Alipoor,
Hofesh Schecter and Akala.

Our Performance Live strand adapted
Alexander Zeldin’s critically acclaimed
stage play LOVE for BBC Two and
Rachel Maclean’s darkly comic film
about contractionary pressure
faced by women today, Make Me Up,premièred on television as part of the
Arena arts documentary strand.
Whilst on BBC Four, Dr James Fox explored
the West’s contact with the people andcultures of the Pacific with the three-partseries Oceans Apart: Art and the Pacific.
Radio 4 Arts programmes continue tofeature many new artists and movements,
as well as highlighting the relationshipbetween the arts and politics and society.
In Class Act, Lenny Henry explored how
to get more young working-class and
BAME actors into the industry and The
Sound Odyssey with Gemma Cairney
brought British artists together withartists in different countries to take partin musical collaborations. Collecting the
Troubles at the Ulster Museum examined
how a national museum surrounded bya recent conflict now tells that story
through some startling exhibits. And
Only Artists continues to air remarkable,
illuminating conversations about thecreative process between artists.
Also for the first time, Radio 3 and BBC Arts
expanded their presence at the Edinburgh
Festivals, recording a series of speciallycommissioned short dramas in a pop-up
studio as part of the Edinburgh Fringe.

BBC Group Annual Report and Accounts 2018/19

29

DELIVERING OUR PUBLIC PURPOSES

Delivering creative, high quality anddistinctive output and services

DRAMA
This was a standout year for BBC Drama
with new stories and adaptations ofclassic tales enthralling audiences andbreaking records across our services.
One of the biggest shows of the year
across all TV channels was Jed Mercurio’s
Bodyguard. After keeping the nation insuspense for weeks, the finale garneredan audience of 17.1 million (after 28days). Whilst the opening of Killing Eve,acquired from BBC AMERICA and starring
Jodie Comer and Sandra Oh was an
iPlayer sensation. The return of Doctor
Who played by Jodie Whittaker delighted
audiences both young and old, achievinga series average audience of 8.6 million
in the 28 days following broadcast.
Russell T Davies’ A Very English Scandal,
starring Hugh Grant as Jeremy Thorpe
and Ben Whishaw as Norman Scott,
was a critical and audience hit, with theseries nominated for multiple awards.
BBC Drama continues to work with exciting
new talent. Nabhaan Rizwan won the
RTS Breakthrough award for his role inInformer as a young second-generation
British-Pakistani man coerced by acounter-terrorism officer into informing.
Whilst Tamara Lawrence starred in an
adaptation of Andrea Levy’s The Long Song.
Stories featuring strong female leads
and dramas from female writers featured
throughout the year on TV and radio.
The Cry and Mrs Wilson, played by Jenna
Coleman and Ruth Wilson respectively,
drew big audiences. Other titles written
by female writers included The Split,
BBC One’s hugely popular Call the Midwife(which averaged 9.7 million after 28 days)
and two adaptations by Sarah Phelps of
Agatha Christie’s thrilling novels Ordeal
by Innocence and The ABC Murders.
Blackwater was a nine-part mystery on
Radio 4 by leading Irish crime novelist Claire
McGowan, whose starting-point was thereturn of a young woman who went missing
a decade before the story began. And Riot
Girls returned to the station with Caitlin
Moran’s How to Be a Woman and writingfrom a founding member of Pussy Riot.
There were big period TV adaptations ofVictor Hugo’s Les Misérables and John
le Carre’s novel The Little Drummer Girl.

30

Mrs Wilson starring Ruth Wilson

Whilst Radio 3 delivered a bold andinventive re-imagining of Virginia Woolf’s
Orlando and Eugene McCabe’s novel
Death and Nightingales explored sweeping
themes of love and betrayal on BBC Two.
Powerful stories from the Nations were also
represented, with crime thriller The Victim
set in Scotland, the return of Shetland,
Hidden, hit BBC Wales drama Keeping
Faith, which has been commissioned fora second series, and Mother’s Day from
Northern Ireland, a factual drama about
the events, aftermath and public responseto the Warrington bombing of March 1993.
BBC Two continued to deliver new dramawith MotherFatherSon starring Richard
Gere, Helen McCrory and Billy Howle tellingthe story of a press baron and his family.
Black Earth Rising, Hugo Blick’s thriller
about the prosecution of international war
crimes and the West’s relationship with
contemporary Africa, starred Michaela
Coel and John Goodman in a powerfultale that brought world stories to a UK
audience. BBC Four commissioned a
special one-off drama The Dead Roomby Mark Gatiss starring Simon Callow.

BBC Group Annual Report and Accounts 2018/19

Alongside airing classic dramas,
championing new writing and innovative
digital storytelling, Radio 4 broadcast
dramatisations of Maya Angelou’s
life-affirming autobiographies andtreated listeners to Norse Mythology
by Neil Gaiman. It also gave a different
insight into the current affairs agenda
with Mueller: Trump Tower Moscow – aradio drama set behind the scenes of
the investigation into Donald Trump’s
alleged collusion with Russia.
Returning TV series included the hugely
popular Luther, Death in Paradise and on
daytime Shakespeare and Hathaway, which
has become an international hit. Whilst thewriting team behind The Missing returned
to BBC One with Baptiste. On BBC Three,
Jess Brittain’s seductive university-set
psychological thriller Clique continued
a year after the events of series one.

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S T R AT E G I C R E P O R T

ENTERTAINMENTThis year has seen a raft of new formats
join some established and much-loved
entertainment programmes across theBBC’s channels. These programmes canbring the nation together and reflect thewhole of the UK on screen.
There was another big year for Strictly
Come Dancing as an audience of 11 million
followed the contestants competing to
win the Glitterball trophy. Whilst popular
favourites Michael McIntyre’s Big Show, The
Apprentice, MasterChef, The Graham Norton
Show and Would I Lie To You? returned with
big audiences on BBC One. On Saturdaynights we launched a new talent show
which brought together contestants ofdifferent ages and dancing styles into asingle competition to find The Greatest
Dancer. There was also another series of
All Together Now as singers tried to impress
the 100. Whilst annual shows such as
Eurovision and the New Year’s Eve Fireworks,
also drew large audiences to BBC One.
We continued to explore new formats
with the launch of quiz show Catchpoint
as well as bringing back audiencefavourites such as Pointless, Impossible
Celebrities and Have I Got News for You.

On BBC Two Dragons’ Den and Top Gearcontinued to be popular with younger
audiences and Love in the Countryside
saw rural dwellers from across the UK
on a mission to find true love. The Mash
Report was funny and provocative, whilst
viewers were tested by quizzes University
Challenge, Only Connect and Mastermind
while new comedy entertainment
series I’ll Get This showed celebrities
competing not to pick up the bill.
On BBC Three Blindboy Undestroys theWorld explored the housing crisis in acontemporary and creative entertainment
format, and the channel launched
Eating with my Ex, revisiting past
relationships amongst young people.

COMEDY
Scripted comedy on the BBC continued tohold a mirror up to the UK in unearthing
diverse voices and presenting a hugearray of talent, new and established.
Peter Kay’s Car Share returned for two
final episodes on BBC One. The final
episode brought in the biggest audienceof the year for comedy, with over 8
million people watching (after 28 days).
Warren starring Martin Clunes andThis Time with Alan Partridge playedout in peak on BBC One, showing ourcommitment to bringing scripted comedy
to the widest possible audience.
Christmas on BBC One gave us some wellloved treats in Click & Collect with Stephen
Merchant and Asim Chaudhry as well as a
festive special from The Young Offenders.

BBC Two delivered a rich range of
comedy that pushed creative boundaries
with the exceptionally prolific Inside
No. 9 producing a live episode that won
plaudits from audiences and critics.
Mum by Stefan Golaszewski won awards
for its second series as Lesley Manvillereturned as Cathy, and Diane Morgan’s
Philomena Cunk brought her own special
twist to British history in Cunk on Britain– a landmark mockumentary series.
BBC Three welcomed back its mostpopular success stories. Fleabag’s return
was greeted by huge audience love anduniversal critical acclaim. People Just
Do Nothing went out in style as the
Kurupt FM team finally left Brentford.
Guz Khan’s Man Like Mobeen returned tothe streets of Birmingham and Famalam
introduced the public to a surprisingand hilarious array of new characters.
Comedians such as Bilal Zafar, Tom Allen,
Pippa Evans, Ashley Blaker, Lucy Porterand Geoff Norcott brought their popular
stand-up shows to Radio 4. Tez Talks
with Tez Ilyas returned – with extended
podcasts – as did Women Talking About
Cars with Victoria Coren Mitchell. The
station aired the first series of Ability
with BBC New Comedy Award winner Lee
Ridley and Allan Mustafa, and Joe Lycett
explored the nation’s weird and wonderfulObsessions. Dead Ringers continued to
add to the satirical take on the worldof politics and Radio 4 Extra’s Newsjack
offered topical comedy with sketches
and one-liners submitted by the public.

BBC PODCASTS
With the launch of BBC Sounds, we’ve beenable to take new creative opportunities
and our podcasts continue to thrive.
Highlights include:———

Return to contents

Brexitcast, the ‘unashamedly geeky’take on Brexit has given its loyal
listeners, ‘Brexitcasters’, an in-depth
and behind-the-scenes view on all
things Brexit.
The Ratline, the latest from Radio 4’s
Intrigue series, was one of the BBC’s
most popular podcasts this year,
contributing to Radio 4’s record
number of monthly UK podcast
downloads of 16.4 million in October.
You, Me and The Big C – award-winning
podcast that has changed theconversation around cancer, created byRadio 5 live’s Rachael Bland who diedin September 2018.

—

In That Peter Crouch Podcast, Peter
shares his insights on the world and hislife as a Premier League footballer.

—

Beyond Today is our daily news podcast
which looks at one big story; and has
been one of the most popular podcastswith younger listeners on BBC Sounds.

—

Our new podcasts such as No Countryfor Young Women, Radio 1’s Drag
Queens’ Den and The Sista Collective
have given a platform for new voices totalk about their lives and experiences.

—

The Case of Charles Dexter Ward wasa mystery drama from Radio 4 in theformat of a popular investigative
podcast, putting a modern and ‘digital’spin on the short horror by H P
Lovecraft, and was one of the mostlistened to podcasts in December
on BBC Sounds.

BBC Group Annual Report and Accounts 2018/19

31

DELIVERING OUR PUBLIC PURPOSES

Delivering creative, high quality anddistinctive output and services

Great Britain’s Laura Muir during the final of
the Women’s 1,500m at the 2019 European
Athletics Indoor Championships

2,200
extra hours of live sport online
across 54 different sports

Along with comprehensive
coverage of events on thefield of play, BBC Sports
News teams have led theway on significant
sporting issues such as
athlete welfare, betting infootball and drugs in sport.

SPORT
Uniting the nation around big sporting
moments is at the heart of what the BBC
aims to do. Whilst competition for rights
and audiences becomes ever more fierce,
we continue to provide the most popular
TV, radio and online sports services in
the UK.
2018/19 was a huge year for major eventsand the BBC brought free-to-air audiences
live action from events as diverse as
the Commonwealth Games in Australia,
Wimbledon, the Six Nations, the FA
Cup, the inaugural multisport European
Championships from Glasgow and Berlin
and the FIFA World Cup from Russia.
The World Cup on BBC TV alone
attracted over 44 million viewers, withnine matches achieving audiences of32

over 10 million – 27% of World Cup
audiences were under 35. Our World
Cup coverage also achieved a rare hat
trick by winning the BAFTA, RTS andBroadcast awards for Sport. On BBC
iPlayer and BBC Sport, the England v
Sweden match was requested live
3.8 million times – making it the BBC’s
biggest live online programme ever. Acrossthe tournament 26 million hours of World
Cup coverage was streamed on iPlayer.
During 2018 we accounted for around
2% of the sport broadcast on TV, butdelivered around 40% of total TV sportviewing. Football, in particular, plays ahugely important role in connecting withaudiences from all walks of life, including
younger ones and those from diverse
backgrounds. The BBC Sport digital service
remains the most popular in the UK,regularly attracting more than 20 million

BBC Group Annual Report and Accounts 2018/19

UK browsers a week. Our mobile app allows
the UK’s sports fans to personalise theoffer to keep up to date with the teams
and sports they love, wherever they are,whenever they want to. And our online
streaming service is growing rapidly,offering more than 2,200 extra hours oflive sport online across 54 different sports
through BBC Sport and BBC iPlayer onmobile, desktop and connected TVs.
BBC Radio 5 live and 5 live sports extra
offered a wider range of sports than any
other UK broadcaster in the last year.
Comprehensive coverage of the World Cup
in Russia was complemented by exclusive
interviews in the World Cup Daily podcast.
Last year, we broadcast more Premier
League matches than any other UK radio
broadcaster, Test Match Special covered
every England home cricket match andwe broadcast live UFC for the first time.

Return to contents

S T R AT E G I C R E P O R T

MUSICBBC Music continued to champion new
artists, specialist music and distinctive
programming across TV, radio and online.
Radio 1’s Live Lounge Month in November
brought listeners performances fromthe biggest and newest music acts
including The 1975, Mumford and Sons
and Jorja Smith, and 1Xtra continued
to champion UK artists who getlittle mainstream media support.
BBC Radio 2, the UK’s most listened-to
radio station, welcomed Zoe Ball as its
breakfast host. The refreshed schedule
included new shows from Sara Cox, Trevor
Nelson, Jo Whiley and Rylan Clark-Neal
with specialist music shows dedicatedto blues, soul, dance, folk, rock, jazz, bigband and swing, country music and showtunes. Music programming included the19th annual Radio 2 Folk Awards in Belfast
and live shows from Ibiza. The Radio 2
In Concert series included Ed Sheeran
and Emeli Sandé and Ken Bruce’s showfeatured acoustic performances from
Olly Alexander, Andrea & Matteo Bocelli,
Amy Macdonald and Joan Armatrading
amongst others in the Piano Room.
BBC Radio 6 Music featured new andalternative music from the UK andbeyond and gave significant support toemerging artists. With the launch of the
new schedule in January – which included
Lauren Laverne at breakfast – there wasrenewed focus on the amount and rangeof music played in daytime, with at least

30% of music played in daytime being
new. The station broadcast more than
300 live music sessions across the year.

Our Classical Century presenters
Suzy Klein and Sir Lenny Henry

BBC Television broadcast a varied mixof programming featuring the biggest
stars in pop music, including Gary
Barlow: Live at Eden and Ariana Grande
at the BBC, and documentaries ranging
from David Bowie: Finding Fame to Bros:
After the Screaming Stops. On BBC Four
Danielle de Niese presented her firstnarrative documentary for BBC Four
about the lost women composers.
The BBC Proms returned in July 2018with a pre-Proms ‘curtain-raiser event’,one of its most ambitious commissions
to date, which was a part of the BBC’scommitment to commemorating WorldWar One. In partnership with 14-18 NOW
and Edinburgh International Festival, theProms curtain-raiser saw the première of a
new score by Anna Meredith combined withextraordinary visuals by 59 Productions
projected onto the exterior of the Royal
Albert Hall. On the First Night of theProms the visuals were projected inside
the building. A further innovation fromthe opening event was an award-winningvirtual reality experience Nothing to be
Written, created by the BBC VR Hub and 59
Productions, resulting in the first ever VR
Prom. BBC Television covered the Proms
season extensively and attendance in thehall was the highest in three years at 91%.
A newly commissioned work by theacclaimed composer Hans Zimmer wasfeatured as part of Ten Pieces Trailblazers

Our Classical Century
Our Classical Century is an ambitious
year-long season of documentaries
and concert broadcasts across Radio3, BBC Two and BBC Four, joining up
all of the BBC’s classical services andperforming groups for the first time in
one big idea. The season explores the
100 greatest classical music events in
the UK over the last 100 years, fromthe end of World War One to thepresent day, and culminates with a newcommission for the First Night of theProms 2019.

and BBC Radio 3 welcomed Jess Gillam,
former Young Musician woodwind finalist,
as the youngest-ever regular presenter,aged 20. The station announced aregular Slow Radio slot in the schedule,
and continued to bring the best live
classical music experiences across the
UK to audiences everywhere, including
Stockhausen’s Gruppen performed by
the London Symphony Orchestra at Tate
Modern’s Turbine Hall which was broadcast
live in stereo and post broadcast in Binaural
Sound. It also ran a year-long Forests
season exploring the natural world, its
impact and inspiration in music and thearts with live breakfast broadcasts fromdifferent UK forests including Tollymore
Forest, Glen Affric Forest, Gwydyr Forest
Park, Sherwood Forest and The New Forest.
BBC Music’s The Biggest Weekend

BBC Music Live Events –bringing people together—

BBC Music’s Biggest Weekend
was a unique music festival in four
nations with more than 130,000
people in attendance. Radio 1
broadcast live from Swansea, Radio 2
and Radio 3 visited Perth andCoventry and 6 Music landed in
Belfast, with performances acrossthe weekend from over 100 artists
including Liam Gallagher, Nigel
Kennedy and Taylor Swift.

Return to contents—

Radio 1’s Teen Awards shone a lighton the UK’s most inspirational teens.

—

1Xtra Live sold out The O2 Arena
in London.

—

Radio 2 Live in Hyde Park saw Kylie
Minogue duet with Jason Donovan,
Especially for You.

—The 6 Music Festival 2019 went
to Liverpool.

—

Birmingham hosted Asian Network
Live where just shy of 5,000 young
people watched artists from the
British-Asian and global musicscene perform.

—

BBC Music also supported
nationwide initiatives including
Record Store Day and Independent
Venue Week and was present atmany summer festivals.

BBC Group Annual Report and Accounts 2018/19

33

DELIVERING OUR PUBLIC PURPOSES

4

To reflect, represent
and serve the diverse
communities of all of theUnited Kingdom’s nations
and regions and support
the creative economy

The BBC has a fundamental responsibility
as part of our public service mission torepresent the whole of the UK. It is ourduty to reflect the whole of the country toitself and make sure all its diverse views
and voices are heard.
At a time when the country feels
increasingly divided and fragmented, we
recognise that this responsibility has grownin importance. We have to work even harder
to reach out into all the UK’s communities
and reflect them back to the country. We
have to make sure all different views are
represented, on-air and on-screen, andall different perspectives are heard.
We know there is more to do to portray,
as accurately as possible, the full diversityof life and community throughout ourprogrammes and services. We know weneed to work even harder to make surethat people, wherever they are, feel thatwhat we offer resonates directly withthem. Our programmes need to be madeacross the UK’s nations and regions. Our
local and nations services need to be
relevant to audiences in each place.
But as well as showing what makes us
different, we must also celebrate what
unites the country for shared experiences
and a shared national conversation.
We believe the BBC’s unique ability tohighlight what brings the UK together
as well as what makes its communities
and cultures unique is an invaluableasset for the country at a critical time.
The following pages demonstrate how wehave met this purpose through our diverse
output and by continuing to transform
what we offer audiences in Wales, Scotland,
Northern Ireland and across England. They
also highlight the strength of the BBC’scommitment to being a truly inclusive
workplace, with a workforce that reflects
the whole of the country it serves.
The diversity targets we have set ourselves,on- and off-air, are as challenging as any in
the UK media industry. We want to bringabout a fundamental change in the diversityof our workforce, at every level. Across therange and breadth of our programming,
we want audiences to be able to see andhear diverse voices in everything we do.

7/10

17/18

7/10

The average general impression score
all audience groups give the BBC
regardless of age, gender, socialgrouping, ethnic origin or geography.
Source: Kantar Media

56%

17/18

56%

% of UK adults who think the BBC iseffective at reflecting people likethem (ineffective: 21%. 17/18: 20%).
Source: Ipsos MORI

55%

17/18

55%

% of UK adults who think the BBC iseffective at reflecting the part of the
UK they live in (ineffective: 20%.
17/18: 20%).
Source: Ipsos MORI

Award-winning drama Informer
34

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

61%

17/18

62%

% of UK adults who think the BBC iseffective at providing content/services
relevant to them (ineffective: 18%.
17/18: 17%).
Source: Ipsos MORI

56%

17/18

56%

% of UK adults who think the BBC iseffective at catering for the part of the
UK they live in (ineffective: 20%.
17/18: 19%).
Source: Ipsos MORI

Return to contents

BBC Group Annual Report and Accounts 2018/19

35

DELIVERING OUR PUBLIC PURPOSES

Reflecting and representing
the United Kingdom’s nations
and regions and supportingthe creative economy
Providing for audiences across the UK
The BBC is committed to serving its
audiences across the UK, providing
high quality, distinctive and relevant
content for licence fee payers, helping
to maintain reach and providing aneffective vehicle to reflect the rangeof cultures and communities.

Dedicated services
The BBC also provides a range of
dedicated, cross-genre output for
Scotland, Wales, Northern Ireland andthe English Regions across television,
radio and online. Each area makes
television and radio programmes
and online content for their local
audience and for the network.
We have major production centres
in Glasgow, Cardiff, Belfast, Salford,
Bristol, Birmingham and London.

10.4%
Network television programming spend byregion as a percentage of eligible spend

11,888hrs

3.1%
30.9%

8,283hrs

236,870hrs
6.3%

2018

2017

London

49.3%

48.9%

Scotland

10.4%

9.1%

Wales

6.3%

6.7%

Northern Ireland

3.1%

2.4%

Total nations

19.8%

18.2%

Midlands

2.2%

1.9%

North of England

17.6%

18.4%

South of England

8.6%

8.7%

Multi-region*

2.5%

3.9%

Total regions excl. London

30.9%

32.9%

Total nations and regions

50.7%

51.1%

Grand total

100%

100%

BBC Local Radio** and nations radio hours of
output2018

14,960hrs

2017

49.3%

England (excl. London)

Scotland

11,888

11,866

8,679hrs

Wales

14,96014,366

Northern Ireland

8,283

8,639

London236,870 222,946
8,679

8,613

Network television spend based on Ofcom definitions bycalendar year.
*
Multi-region covers programmes made outside
London but which cannot be attributed to any one
region or nation.
**
The BBC Local Radio and nations radio hours of
output only includes BBC original programmes andexcludes any repeat programmes.

36

BBC Group Annual Report and Accounts 2018/19

Return to contents

S T R AT E G I C R E P O R T

Network supply
Over half of network
television production
is in the nations andregions, with 50.7%
from outside London
and 19.8% from
Scotland, Wales andNorthern Ireland.

UK PSB staff by nation
We also remain committed
to locating at least 50% of
our employees outside ofLondon and some 52.2%
are currently based outsideof the M25.
UK PSB staff by nation (equivalent full time) %(excl. BBC Studios in 2018)
31 March
2019

31 March
2018

England (excl. London)

34

35

London48

47

Scotland

7

7

Wales

7

7

Northern Ireland

44NationREAD ABOUTPERFORMANCE IN
THE NATIONS:

p.40
p.42
p.44
p.46

Wales
ScotlandNorthern Ireland
EnglandLine of Duty, produced in Northern Ireland
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BBC Group Annual Report and Accounts 2018/19

37

DELIVERING OUR PUBLIC PURPOSES

Reflecting and representing
the United Kingdom’s nations
and regions and supportingthe creative economy
The BBC is for everyone, and reflecting
and representing the diversity of ouraudiences is at the heart of everything
we do.
Through our on-screen storytelling, news
reports, online and radio content, we
aim to represent all of the cultures anddiverse voices of today’s UK, embracing
the richness and depth of modern Britain,celebrating our differences and bringing thenation together for shared experiences.
That means giving a platform to a wide
range of voices, stories and talent fromacross the UK. We have set ourselves
on- and off-air targets to ensure that
our audiences see and hear their lives,
experiences, interests and voicesreflected back to them. Our content has
the power to raise awareness, challenge
perceptions and provide a balanced viewon the events that shape our lives.
This year, the phenomenal success ofprogrammes such as Killing Eve with
Jodie Comer, Sandra Oh, Fiona Shaw andKirby Howell-Baptiste; Silent Witness
with Liz Carr; Black Earth Rising withMichaela Coel; Doctor Who with Jodie
Whittaker and Call The Midwife, has helped
to highlight female representation in astrong, positive light in leading roles.
Our commitment to gender balance andfemale representation has also been
replicated across radio, with Zoe Ballat breakfast, Sara Cox at Teatime and
Jo Whiley in a new evening solo slot.
BBC News’ 100 Women continues tohighlight women’s viewpoints and issues
from around the world, with challenging
and inspirational content shared acrossour news platforms.
We launched The 50:50 Challenge –a pledge to ensure an equal numberof male and female expert contributors
on our news, current affairs and topicalprogrammes.
Megha Mohan became the BBC’s first
Gender and Identity Reporter and has been
exploring gender through her in-depth
documentary on Intersex. BBC Africa
presenter Ben Hunte was also appointed as
the corporation’s first LGBT correspondent.
We leverage the power of our programmes
to raise awareness and shine a spotlighton issues that grip the nation and reflect
the challenges faced by society.

38

Our year-long season Crossing
Divides kicked off, featuring a diverse
range of people daring to talkacross divides of ethnic group, class,generation and politics and more.

In comedy, In My Skin focused on having
a local Welsh cast, and across our factual
programmes highlights included The
Royal Welsh, Huw Edwards’ The Fallen,
and Hidden Wales with Will Millard.

We continue to portray disability in ourcontent, often incidentally. Paralympic
medallist Lauren Steadman reached thesemi-final of Strictly Come Dancing andthe show also featured Candoco Dance
Company – a group of disabled and nondisabled dancers. Nikki Fox also joined
the presenter line-up on Supermarket
Secrets this year. And BBC One drama
Care, depicted the difficulties faced whencaring for relatives living with dementia.

You can read more about our work on
diversity behind the camera on page 82.

We continue to work hard to makeour continuing dramas as relevant as
possible, which is critical to reaching
young and diverse audiences. Last year,
EastEnders shone a spotlight on theissue of knife crime, Casualty tackled thesubject of rape, and Holby City raised
awareness of male mental health.
Telling compelling stories that defined ourhistory and helped to shape the society inwhich we live is a part of who we are andwhat we do. A Very English Scandal was a
global hit, winning a Golden Globe award
for best supporting actor (Ben Whishaw).
The Big British Asian Summer saw a seasonof content across TV, radio and online,
telling the stories and experiences ofBritish Asians and how British and Asian
cultures have come together. Programmes
within the season included: Bollywood:
The World’s Biggest Film Industry, Supercar,
Superfam and Searching for Mum.
Our regional representation is criticalin reflecting local and regional voices
and connecting communities, andensures we are truly representing
the voices of our audiences.
In Northern Ireland we increased thenumbers of stories on BBC News NI online.
Dramas set in Northern Ireland included
Mother’s Day, Doing Money and Death andNightingales and there was representation
across our factual programmes such as
Songs of Praise – Remembrance Sunday, andTroubles: The Life After and Showbands: The
Hidden Story of Irish Music. Across Wales,
major dramas remain at the forefront of our
output, including new drama Keeping Faith.

BBC Group Annual Report and Accounts 2018/19

A CHANNEL FORSCOTLAND

Scotland’s new TV channel, BBC
Scotland, launched this year, partof the BBC’s biggest investment incontent in Scotland for a generation.
The new channel will see hundreds ofhours of newly commissioned diverse
programmes reflecting modern
Scotland, including Getting Hitched
Asian Style, a series that goes behindthe scenes with Scotland’s biggest
Asian wedding planners, The People’sNews, in which Scots speak theirminds on the events of the week,
and Emeli Sandé’s Street Symphonywhich follows the singer-songwriter
as she travels across Scotland andselects five buskers to put on aconcert with an entire orchestra.
The channel will show a raft of new
documentaries, such as Childrenof the Devolution, where Scottish
journalist Allan Little meets families
across Scotland spanning several
generations to look at how their lives
have been shaped by the creationof the Scottish Parliament.
Dramas The Cry and Clique were set
in Scotland, along with the comedy
Still Game and factual programmes
including Faith Behind Bars and
The Big Sing from Edinburgh.
Read more about the BBC Scotland
channel on page 42

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S T R AT E G I C R E P O R T% of each audience group who think the BBC informs, educates and entertains people in the UK/themMale 16+

Female 16+

ABC1 16+

C2DE 16+

16-34

35-54

55+

White 16+

BAME 16+

Effective

70%

73%

79%

63%

69%

70%

74%

72%

69%

Ineffective

14%

11%

9%

16%

11%

13%

12%

12%

13%

2017/18: Effective

73%

74%

81%

65%

71%

76%

74%

75%

67%

2017/18: Ineffective

10%

8%

7%

11%

8%

9%

10%

8%

12%

% of each audience group who think the BBC is effective at reflecting people like them
Male 16+

Female 16+

ABC1 16+

C2DE 16+

16-34

35-54

55+

White 16+

BAME 16+

Effective

55%

56%

62%

48%

51%

57%

59%

57%

48%

Ineffective

23%

19%

19%

24%

20%

22%

21%

21%

26%

2017/18: Effective

56%

57%

64%

47%

51%

60%

58%

58%

48%

2017/18: Ineffective

22%

18%

18%

23%

21%

18%

20%

19%

29%

BBC Television reach: % of each audience group in TV homes that watch BBC Television each week
Male 16+

Female 16+

ABC1 16+

C2DE 16+

16-34

35-54

55+

White 16+

BAME 16+2018/19

76%

80%

78%

77%

56%

80%

92%

80%

65%

2017/18

78%

82%

81%

80%

60%

82%

93%

81%

69%

BBC Radio reach: % of each audience group that listen to BBC Radio each week
Male 16+

Female 16+

ABC1 16+

C2DE 16+

16-34

35-54

55+

White 16+

BAME 16+2018/19

66%

59%

70%

53%

51%

62%

72%

66%

45%

2017/18

67%

62%

72%

56%

53%

64%

74%

68%

47%

White 16+

BAME 16+

BBC Online reach: % of each audience group that use BBC Online each month*Male 18+

Female 18+

ABC1 18+

C2DE 18+

18-34

35-54

55+

2018/19

80%

74%

88%

64%

89%

87%

59%

2017/18

78%

72%

90%

58%

89%

84%

57%

BBC Television: Time spent watching BBC TV in TV homes per head, per week (hh:mm)
Male 16+

Female 16+

ABC1 16+2018/19

07:13

07:57 07:28 07:45 02:32 05:43 12:54 08:03 04:07

2017/18

07:41

08:49

08:08

C2DE 16+

08:27

16-34

02:59

35-54

55+

06:25

13:53

08:42

04:23

35-54

55+

White 16+

BAME 16+

BBC Radio: Time spent listening to BBC Radio per head, per week (hh:mm)
Male 16+

Female 16+

ABC1 16+

C2DE 16+

16-34

2018/19

10:04 09:04 10:29 08:27 04:20 08:40 14:31 10:38 04:26

2017/18

10:38

09:30

10:57

09:00

04:39

0 9:17

15:10

11:10

0 4:41* Comscore MMX Multi-Platform measures from 18+ and monthly.
Source: Ipsos MORI, BARB, RAJAR. Online reach data on page 27 and here from Comscore MMX Multi-Platform, UK, Total Unique Visitors per month, [P] BBC Sites, October
2017-March 2018, April 2018-March 2019; percentages based on overall UK populations using ONS population estimates and the BARB Establishment Survey. Figures are restatedhere and on page 25 for 2017/18 out of the 18+ population rather than 15+ as appeared in the 2017/18 BBC Annual Report and Accounts as Comscore MMX is desktop only for
15-17 year-olds.
BBC TV and BBC Radio reach here and on page 27 based on 15+ minutes.

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BBC Group Annual Report and Accounts 2018/19

39

DELIVERING OUR PUBLIC PURPOSES

The BBC in Wales
New investment in English language
services has enabled BBC Wales tostrengthen its programming and online
services across a range of platforms.
On BBC iPlayer, requests for BBC Wales
content increased three-fold to 44 million
in 2018, thanks to the success of a rangeof series including Keeping Faith, starring
Eve Myles, and Hidden, starring Sian
Reese-Williams. Both series – locallyco-commissioned with S4C – featured in
the UK top ten new drama premières on
BBC iPlayer in 2018 and both will returnto network screens in the near future. In
parallel, BBC Wales’ extensive work with
BBC Writersroom is focussed on ensuring
the long-term health of drama-writing
and production in Wales.
This creative momentum also boosted theportrayal of Wales on network screens,with home-grown series such as Back inTime for the Factory, Rhod Gilbert’s Work
Experience, The River Wye and Hidden Wales
all performing strongly with UK audiences.
The NHS took centre stage in July as BBC
Wales marked the service’s 70th birthday.
To Provide All People was the centrepieceof a special season – a drama-poem
written by Owen Sheers with an all-starcast including Michael Sheen, Eve Myles,
Sian Phillips, Jonathan Pryce, Martin
Freeman and Meera Syal. This was alsobroadcast on BBC Two across the UK.
Beyond drama, BBC Wales continued
to increase the range and impact of its
television output. Tourist Trap was the first
new Welsh comedy on the BBC in morethan a decade, and pilot episodes of The
Tuckers and In My Skin have both resulted
in full series commissions for 2019. BBC
Wales has also been focusing on developing
new comedy writers and performers: theFind Me Funny commissioning scheme
attracted almost 350 submissions andRadio Wales is now a major partner ofthe Machynlleth Comedy Festival.
In factual programming, Wales: England’s
Colony? explored the historical relationshipbetween England and Wales, whilst Wales:
Land of the Wild took a breathtaking
look at the nation’s natural history. BBC
cameras also caught Carwyn Jones’ final
days in office in Being First Minister.
There was a strong focus on younger
audiences across the year, withHayley, The Wedding Guru and Young,Welsh and Pretty Minted performingstrongly. In parallel, BBC Wales’ new40

To Provide All Peoplesocial media service, BBC Sesh, also
launched this year – creating a brandnew platform for young and previously
unheard voices from across Wales.
In news, changing audience patterns are
now clear. While overall TV news reachfell, social media and online services
continued to grow strongly with average
weekly browsers to BBC Wales news
online increasing by 18% year-on-year.
In a momentous political year, coverage
was strengthened by new specialist
correspondents working across a rangeof portfolios including home affairs,social affairs, sport and Brexit.
The new current affairs strand, BBC Wales
Investigates, continued to make headlines
across the UK with major reports on
teenage drug runners, IS terror networks
and Neo-Nazi groups operating in Wales.
In audio and radio, it was a year ofsignificant audience and industry change
in Wales with both major commercial
broadcasters ending locally-produced
breakfast programming. BBC Radio Wales
marked its 40th anniversary in November
with a major expansion of its FM footprint,
but the radio audience landscape continues
to be challenging, leading to changes to theRadio Wales breakfast news programme.

BBC Group Annual Report and Accounts 2018/19

The growing role of online audio andpodcasts is now clear. In 2018, podcast
downloads for Radio Wales and Radio
Cymru combined saw a 50% increase yearon-year and the launch of BBC Sounds
offered a brand new platform for audio
programming, resulting in a remarkable
collaboration between the current affairs
and audio drama teams at BBC Wales.
Shreds explored the untold story of one
of Cardiff’s most notorious miscarriages
of justice – following the murder of
Lynette White in 1988 – and it quickly
became one of BBC Sounds’ mostpopular and distinctive original series.
The coming year will see the completion of
BBC Wales’ move into the new broadcast
centre at Central Square in Cardiff city
centre. Central Square will be a pioneeringdevelopment for the BBC. Roughly half
the size of the current Llandaff sites andless expensive to operate on a like-forlike basis, Central Square will be our mostopen and accessible building in the UK withsome of the most advanced broadcast andproduction systems anywhere in Europe.
More than 1,000 staff will relocate to the
new centre, with full migration expected
to be completed by spring 2020.

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S T R AT E G I C R E P O R T

Performance by service
Dedicated
services

Content
We spent a total of£29 million on these
services in 2018/19

Reach% of population who use
the service each week

Time spent watchingor listening to a service
each week
Length of time the average
listener spent each weekwith the service

Costs per user hour
How much it costs todeliver each service foreach hour used

BBC Radio Wales is a speech-led
service for adults, which offers awide range of genres and reflects
the issues, events, culture andinterests of the people of Wales.

£15m

12.6%

07:43

11p

2017/18: £15m

2017/18: 14.3%

2017/18: 08:05

2017/18: 9p

BBC Radio Cymru is a speech andmusic radio service for Welsh
speakers, which offers a wide range
of genres and reflects the issues,
events, culture and interests of thepeople of Wales.

£14m

17.5%*

12:05

23p

2017/18: £14m

2017/18: 21.1%

2017/18: 13:02

2017/18: 17p

Reach definition; 15+ minutes for all services and audiences age 15+.
Sources: RAJAR (Radio reach and time per listener; data based on Total Survey Area – TSA).
* BBC Radio Cymru: RAJAR data (reach and time per listener) based on ‘Understand Welsh’. BBC Radio Cymru reaches 4.4% of the overall 15+ population in Wales who listen
for 10:21 a week on average.

70% 48%
17/18

17/18

% of adults in Wales who think the
BBC is effective at informing,
educating and entertaining people
in the UK/them (ineffective 12%.
17/18: 10%).

% of adults in Wales who think
the BBC is effective at reflecting
people like them (ineffective 23%.
17/18: 23%).

72%

80%

17/18

82%

69%

72%

BBC Television reach% of adults in Wales in TV homes who
watch BBC Television each week.

BBC Radio reach% of adults in Wales who listen
to BBC Radio each week.

08:42

11:49

17/18

09:35

BBC Television time per headTime spent watching BBC TV in TV
homes per head, per week in Wales(hh:mm).

39%

17/18

51%

17/18

44%

Dedicated Welsh news services
on television% of adults in Wales in TV homes
who view this content on BBC
Television each week.

17/18

11:49

BBC Radio time per headTime spent listening to BBC Radio perhead, per week in Wales (hh:mm).

Sources: Ipsos MORI, BARB, RAJAR. All reach and time per head figures are based on adults 16+. BBC TV and BBC Radio reach based on 15+ minutes. BBC TV dedicatednews services reach based on 3+ minutes.

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BBC Group Annual Report and Accounts 2018/19

41

DELIVERING OUR PUBLIC PURPOSES

The BBC in Scotland
An unforgettable opening video, with Chvrches
singer Lauren Mayberry and the BBC Scottish
Symphony Orchestra, served to introduce theBBC’s newest television service – BBC Scotland.
Launched to much acclaim in February
2019, and reaching almost one in fourof Scotland’s population on its opening
night, the channel has in a few shortmonths attracted viewers to programmes
as diverse as the première of comedy
gold, Still Game, with its ninth and final
series, fascinating factual documentaries
such as the six-part Inside Central Station,
Getting Hitched Asian Style and Born
to be Wild, and cutting-edge comedy
with Limmy’s Homemade Show and thecrossover of the hugely popular Radio
Scotland news quiz, Breaking the News.
At the core of the channel’s offer is a local,
national and international news offer –The Nine – that has introduced new talent
and a new approach to the presentationof news from a Scottish perspective.
Debate Night, hosted by Stephen Jardine,
has offered a unique opportunity foraudiences from across Scotland to put theirquestions to the country’s decision-makers.
Investigative journalism was to the fore
across the year, with investigations
into Police Scotland, child abuse, live
animal exports and the death of Sheku
Bayoh all attracting significant public
and political attention. An innovative
investigative podcast of the murderof Nairn banker, Alistair Wilson, rose
to top the BBC’s podcast charts.
It was also a productive year for dramawith the fifth series of Shetland (with a
35% audience share in Scotland), thefour-part The Cry (both on network
BBC One), the linear premiere of Edinburgh
student drama Clique on the new BBC
Scotland channel and the ever-enduring
attraction for audiences of River City,
now in its 17th year on screen.
Factual documentary highlights for BBC
network included Tomorrow’s World Live,Snatches (eight monologues written
by women, covering stories from the
100 years since women won the vote);
Raymond Briggs: Snowmen, Bogeymen &Milkmen, The Queen: Her Commonwealth
Story and The Flu that Killed 50 Million.
Another series of the hugely popular This
Farming Life was broadcast in February.

42

Still Game

Perennial favourites Landward andBeechgrove Garden once again returned
to Scotland’s screens and a rangeof documentaries covered issues as
broad as Scotland from the Sky, Slavery:
Scotland’s Hidden Shame, and Rip It Up– a three-part history of Scottish pop.
In the year that tragically saw a fire
destroy the Glasgow School of Art
building, BBC Scotland marked the150th anniversary of the birth of Charles
Rennie Mackintosh with documentaries
Mackintosh: Glasgow’s Neglected
Genius and Mackintosh’s Tea Room.
Audiences in Scotland were very
appreciative of factual output suchas The Town that Floored the World(that told of Kirkcaldy’s role in thehistory of linoleum) and the six-part
Fish Town, which looked at Peterhead,the biggest fishing port in the UK.
September 2018 marked ten years on-airfor BBC ALBA. The introduction of weekend
news enabled viewers – and listeners to
BBC Radio nan Gàidheal – to access, forthe first time, the latest news in Gaelic
every day of the week. The CBeebies and
CBBC brands were added to BBC ALBA
and original content now sits alongside
animated programmes for two hours

BBC Group Annual Report and Accounts 2018/19

each day. A range of programmes captured
the commemoration events that marked
the centenary of the end of World War One,
including the tragic sinking of the Otranto,
Tuscania and Iolare vessels and the impactof their loss on the Hebrides in 1918/19.
In November 2018, BBC Radio Scotland
reached its 40th birthday. Amongst the
many key broadcast moments acrossthe year, there was focus on the openingof the new V&A Museum in Dundee andthe centenary of the World War One
Armistice was marked with a speciallywritten composition by Deacon Blue’s
Ricky Ross. Monday lunchtimes had a
new sound at the start of 2019 with amini-series of contemporary dramas andcomedian Mark Nelson joined the station
on Fridays with his new panel show, The
Good, the Bad and the Unexpected. The
Afternoon Show saw Grant Stott join Janice
Forsyth to share the presenting duties.
The award-winning BBC The Social
continued to find new creative talent for
BBC Scotland and brought a range ofdiverse, new talent into the BBC, bothon- and off- screen. The year also saw thedevelopment of new strands, including
iPlayer specials and new TV formats
such as Tune, The Collective and Loop.

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S T R AT E G I C R E P O R T

Performance by service
Dedicated
services

Content
We spent a total of£37 million on these
services in 2018/19

Reach% of population who use
the service each week

Time spent watchingor listening to a service
each week
Length of time the average
viewer/listener spent eachweek with the service

BBC ALBA offers, to Gaelic
speakers and learners, a distinctive
range of originated programmingthat reflects and supports Gaelic
culture, identity and heritage.

£9m

59.3%*

03:33

19p

2017/18: £8m

2017/18: 62.1%

2017/18: 04:58

2017/18: 14p

BBC Radio Scotland is a speech-led
service for adults. Mixed-genre
programming reflects the diversityof Scottish culture and covers
national and international issues
and events relevant to listeners
across the country.

£25m

17.5%

06:49

8p

2017/18: £22m

2017/18: 19.2%

2017/18: 06:25

2017/18: 8p

BBC Radio nan Gàidheal offers acomprehensive speech and music
radio service for Gaelic speakers.
Mixed-genre programming reflects
the diversity of Scottish culture and,from a Gaelic perspective andthrough the medium of the Gaelic
language, covers national andinternational issues and events
relevant to listeners acrossthe country.

£4m

56%**

06:39

27p

2017/18: £4m

2017/18: 61.1%

2017/18: 07:43

2017/18: 21p

BBC Scotland: a mixed genre
television channel that appeals
to and reflects the diversityof Scotland.

Launched on 24 February 2019. Full-year data not yet available as the channel was only in operation for
six weeks in Financial Year 2018/19.

Costs per user hour
How much it costs todeliver each service foreach hour used

BBC Radio Scotland: Reach definition: 15+ minutes and audiences aged 15+. Sources: RAJAR (Radio reach and time per listener; data based on Total Survey Area – TSA).
* BBC ALBA: TRP Panel based on Gaelic-speaking 16+ population in Scotland. BBC ALBA reaches 10.3% of the overall 16+ population in Scotland who use the service for 01:55
a week on average (source: TNS Scottish Opinion Survey based on all adults aged 16+ in Scotland).
** Radio nan Gàidheal: TRP Panel based on Gaelic-speaking 16+ population in Scotland.

70% 54%
17/18

17/18

% of adults in Scotland who think
the BBC is effective at informing,
educating and entertaining people
in the UK/them (ineffective 12%.
17/18: 9%).

% of adults in Scotland who think
the BBC is effective at reflecting
people like them (ineffective 24%.
17/18: 19%).

69%

80%

17/18

82%

54%

45%

17/18

58%

BBC Television reach% of adults in Scotland in TV homes
who watch BBC Television each week.

BBC Radio reach% of adults in Scotland who listen to
BBC Radio each week.

08:34

07:14

17/18

09:22

BBC Television time per headTime spent watching BBC TV in TV
homes per head, per week in Scotland(hh:mm).

53%

17/18

49%

Dedicated Scotland news services
on television% of adults in Scotland in TV homes
who view this content on BBC
Television each week.

17/18

08:15

BBC Radio time per headTime spent listening to BBC Radio perhead, per week in Scotland (hh:mm).

Sources: Ipsos MORI, BARB, RAJAR. All reach and time per head figures are based on adults 16+. BBC TV and BBC Radio reach based on 15+ minutes. BBC TV dedicatednews services reach based on 3+ minutes.

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BBC Group Annual Report and Accounts 2018/19

43

DELIVERING OUR PUBLIC PURPOSES

The BBC in Northern Ireland
It was a year of gripping dramas, including
the acclaimed Line of Duty, major music
events and strong local radio performancefor BBC Northern Ireland.
The BBC Radio 2 Folk Awards, featuringperformances from some of the best folk
and traditional music artists around, wasbroadcast live from Belfast for the firsttime in April 2018.
The following month thousands of musicfans of all ages descended upon Belfast’s
Titanic Slipways for the Biggest Weekend,when 6 Music brought artists as diverse
as Beck, First Aid Kit and Underworld
to the city for two days of music. As wellas live network radio coverage of theevent across both days, the BBC Four
broadcasts from Northern Ireland
had a UK reach of around 600,000.
Two very different and well-received
dramas filmed and set in Northern Irelandalso resonated with audiences aroundthe UK. The BBC One contemporary
family drama Come Home, starring
Christopher Eccelston and Paula
Malcomson, had a series reach of
7.1 million viewers, whilst BBC Two’s
period drama Death and Nightingales,
starring Jamie Dornan and Matthew
Rhys, had a series reach of 3.4 million.
The fifth series of Line of Duty made its
much awaited return to BBC network
television in late March 2019, attracting
big audiences and critical acclaim. The
first episode had an average audience of
13.2 million (after 28 days), making it oneof the year’s most popular programmes.
In news, we have expanded our online
services across weeknights and weekends
and are providing audiences with moredigital video and graphics to bring news
stories to life on BBC News NI Online.
Our news teams have been helping
to explain Northern Ireland’s politicalstatus and unique position in relation to
Brexit for UK-wide audiences. Meanwhile,the creation of a youth panel is helping
ensure we are bringing news stories
of interest to younger audiences tothem in ever more accessible ways.
BBC Radio Ulster/Foyle remains the mostlistened to station in Northern Ireland,with an average weekly reach in the lastquarter of 2018 of just under 35% of theadult population. Underpinned by popular,
long-running content including The Nolan
Show, Good Morning Ulster and Talkback,the station also continues to develop

44

Death and Nightingales

younger talent and broaden its specialist
music scope, be that through broadcastingfrom the Stendhal Music Festival or
through the return of School Choir of
the Year, which has now been extended
to television. We also launched a new
podcast series featuring highlights fromlegendary broadcaster Gerry Anderson tomark BBC Radio Foyle’s 40th year on-air.
Serving younger audiences remains
a priority. Top Table, in which young
people are given a platform to addressand challenge people in power,
continued throughout 2018/2019.
Our Aim High initiative, through ourpartnership agreement with Northern
Ireland Screen, returned this year togive aspiring television producers theirfirst work experience in the field.
We have continued to deepen our existing
partnerships with the Ulster Orchestra,
Libraries NI and local universities through arange of collaborative initiatives and events.
In sport, we signed a new three-year
live football deal with the Irish FA andNorthern Ireland Football League andwe extended our deal to broadcast
the International North West 200 fora further five years. A new three-year
deal was signed with SuperCupNI and
we continued to bring rugby fans Pro14
action on BBC Radio Ulster and broadcast
eight games from the 2018 GAA Ulster
Football Championship on television

BBC Group Annual Report and Accounts 2018/19

and iPlayer. We also broadcast the Women’s
Premiership League Cup Final and profile
documentaries on rugby star Rory Bestand the Ireland women’s hockey team.
We continue to provide Irish languageand Ulster-Scots programming across ourservices. Our local factual, current affairs,
entertainment and comedy programmes
provide our audience with a variety ofcontent that reflects their lives. They are
regularly amongst the most watched
programmes on BBC One and BBC Two
in Northern Ireland and, on average, add
five percentage points to BBC One and
BBC Two channel share performancein Northern Ireland in their slots.
Long running programmes such as
Spotlight, Nolan Live, The View and
The Blame Game retained their impact
and appeal with local audiences. They
were complemented by documentarycommissions about different aspectsof contemporary life and the legaciesof our region’s recent past.
Changing audience needs and patternsof consumption present challenges
for the BBC in Northern Irelandand elsewhere. Understanding, andkeeping pace with what’s happening,
including the opportunities provided
by new technologies and platforms,
remain key priorities for our work.

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S T R AT E G I C R E P O R T

Performance by service
Dedicated
services

BBC Radio Ulster is a speech-led
service, providing a mix ofprogrammes that reflect news,
events and community life in all its
different aspects and diversity.
BBC Radio Foyle is a speech-led
service for audiences in thenorth-west of Northern Ireland.
It provides a mix of news and otherprogramming which complements,
and contributes to, BBC Radio
Ulster’s region-wide service.

Content
We spent a total of £18
million on these services in
2018/19

Reach% of population who use
the service each week

Time spent watchingor listening to a service
each week
Length of time the average
listener spent each weekwith the service

Costs per user hour
How much it costs todeliver each service foreach hour used

£18m

34.0%

10:38

6p

2017/18: £18m

2017/18: 38.0%

2017/18: 10:18

2017/18: 6p

Reach definition: 15+ minutes and audiences aged 15+.
Sources: RAJAR (Radio reach and time per listener; data based on Total Survey Area – TSA).

65% 50%17/18

67%% of adults in Northern Ireland
who think the BBC is effective at
informing, educating andentertaining people in the UK/them(ineffective 14%. 17/18: 16%).

80%

17/18

81%

60%

62%

BBC Television reach% of adults in Northern Irelandin TV homes who watch
BBC Television each week.

BBC Radio reach% of adults in Northern Ireland who
listen to BBC Radio each week.

06:46

07:26

17/18

07:22

BBC Television time per headTime spent watching BBC TV in TV
homes per head, per week in Northern
Ireland (hh:mm).

55%% of adults in Northern Ireland
who think the BBC is effective atreflecting people like them(ineffective 25%. 17/18: 24%).

50%

17/18

17/18

17/18

53%

Dedicated Northern Ireland news
services on television% of adults in Northern Ireland in
TV homes who view this content on
BBC Television each week.

17/18

07:43

BBC Radio time per headTime spent listening to BBC Radio perhead, per week in Northern Ireland(hh:mm).

Sources: Ipsos MORI, BARB, RAJAR. All reach and time per head figures are based on adults 16+. BBC TV and BBC Radio reach based on 15+ minutes. BBC TV dedicatednews services reach based on 3+ minutes.

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BBC Group Annual Report and Accounts 2018/19

45

DELIVERING OUR PUBLIC PURPOSES

The BBC across England
Uncovering new talent has been at the forefront of
BBC England’s activities across the country thisyear, with BBC Local Radio stations recruiting newpresenters to front their new evening schedule.
All of our 39 Local Radio stations in
England have introduced up to 15 hours
of new local programming each week
after the shared evening programme
ended in October 2018. In total, we havelaunched more than 150 new shows in theevening, with a diverse mix of presenters
and themes as part of our effort to build a
new relationship with underserved
audiences across England.
More than 80 of the new evening shows arepresented by people new to broadcasting
and many of them are now being featured
elsewhere on our output. Letitia George on
BBC Coventry and Warwickshire presents
The C Word on Monday evenings andhas acted as a relief presenter on bankholidays and Saturday mornings. Kyle
Walker from The Dead Good Show on BBC
Radio Manchester is now a regular voiceon the station’s daytime line-up and has
worked on BBC Sport’s Football Focus.
Some of the presenters have been foundthrough talent searches. Summaya Mughal
was discovered through BBC Radio
Nottingham’s Untapped talent search andcan now be heard every week night on
the station. BBC Radio Lincolnshire and
BBC Radio Sheffield have also run similar
talent searches looking for new presenter
talent for their evening show slots.
The new evening programmes focus
on innovation. For example, since its
launch, The Residency on BBC Radio
Cambridgeshire has featured 199 newcontributors, of which 22% have been
BAME, 42% female and 45% under
the age of 40. BBC Sussex and Surrey
have launched a new strand called
Politics and Chill, which featured local
councillors having to deliver their
manifesto in the form of a rap.
BBC England has been innovating inaudio in other ways too, launching
podcasts such as Multi Story, whichfeatures stories from across BBC Local
Radio, and The Naked Podcast, which sees
guests interviewed in the nude. Moretraditionally, BBC Wiltshire organiseda screening of the wedding of HRH Prince
Harry, with an estimated audience of46

Some of the new local radio presenters

more than 3,000 people watching in
the grounds of Salisbury Cathedral.
Meanwhile, BBC Local Radio has morethan 80 commentary deals with footballteams across England from the Premier
League to League Two and, of course,
we have our County Cricket commentary
service. BBC Introducing continues toprovide a weekly platform on BBC Local
Radio for the best new musical talent.
BBC England is strengthening ourposition as the guarantor of local news.
Our partnership with the local andregional newspaper industry continues
to develop. The Local Democracy
Reporters, who exclusively cover councils
and other public bodies across thecountry, have now produced more than
78,000 stories. These are used by the
BBC and our partners. The success of
the Local News Partnership has been
acknowledged across the news industry.

BBC Group Annual Report and Accounts 2018/19

Our 6:30pm regional TV news bulletinsare still, collectively, the most watchednews service on UK TV based on average
audience. We are also innovatingwith a broader range of genres on TV
and online, producing more varied
content for audiences in England.
This year we’ve made a wide variety of TV
programmes for audiences in England, suchas River Walks on BBC One, which exploredsome of the country’s most beautiful
countryside, and Hidden Britain for BBC
Four, which took a fascinating look at thehistory and heritage of some of our diverse
communities. How the NHS Changed Our
World on BBC One looked at the impactof the health service in its 70th year.
Explorer and TV presenter Paul Rose madea beautiful series about the Cumbriancountryside in The Lakes, shown on
BBC One and BBC Two, and followed
it up with a series set on the other sideof England in The Yorkshire Dales.

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S T R AT E G I C R E P O R T

Performance by service
Dedicated
services

BBC Local Radio is a primarily
speech-based service of news,
information and debate, with astrong emphasis on interactivity.

Content
We spent a total of£124 million on these
services in 2018/19

Reach% of population who use
the service each week

Time spent watchingor listening to a service
each week
Length of time the average
listener spent each weekwith the service

£124m

13.1%

08:36

5p

2017/18: £118m

2017/18: 14.3%

2017/18: 08:52

2017/18: 4p

Costs per user hour
How much it costs todeliver each service foreach hour used

Reach definition: 15+ minutes for audiences aged 15+.
Sources: RAJAR (Radio reach and time per listener; data based on Total Survey Area – TSA).

% of adults in different areas of England who think the BBC informs, educates and entertains people in the UK/them

Effective

England 16+

North of England 16+

Midlands 16+

South of England 16+

London 16+

72%

72%

69%

76%

72%

Ineffective

12%

14%

12%

11%

11%

2017/18: Effective/Ineffective

74%/9%

72%/9%

77%/9%

78%/8%

69%/9%% of adults in different areas of England who think the BBC is effective at reflecting people like them
England 16+

North of England 16+

Midlands 16+

South of England 16+

London 16+

Effective

57%

56%

58%

57%

54%

Ineffective

21%

23%

20%

19%

20%

2017/18: Effective/Ineffective

57%/20%54%/20%61%/19%57%/20%57%/19%BBC Television reach: % of adults in TV homes in different areas of England who watch BBC Television each week
England 16+

North of England 16+

Midlands 16+

South of England 16+

London 16+

2018/19

78%

79%

78%

80%

73%

2017/18

80%

81%

81%

82%

76%

BBC Radio reach: % of adults in different areas of England who listen to BBC Radio each week
England 16+

North of England 16+

Midlands 16+

South of England 16+

London 16+

2018/19

63%

61%

68%

73%

51%

2017/18

65%

62%

69%

75%

53%

Dedicated English Regions news services: % of adults in England in TV homes who view this content on BBC Television each week
England 16+

North of England 16+

Midlands 16+

South of England 16+

London 16+

2018/19

39%

41%

39%

43%

32%

2017/18

42%

44%

42%

46%

35%

BBC Television: Time spent watching BBC TV in TV homes per head, per week (hh:mm)
England 16+

North of England 16+

Midlands 16+

South of England 16+

London 16+

2018/19

07:28

07:46

07:25

08:13

06:22

2017/18

08:07

08:24

07:57

09:02

07:00

BBC Radio: Time spent listening to BBC Radio per head, per week (hh:mm)
England 16+

North of England 16+

Midlands 16+

South of England 16+

London 16+

2018/19

09:44

09:03

10:50

12:11

07:08

2017/18

10 :12

09:35

11:0 913:0 6

07:17

Source: Ipsos MORI, BARB, RAJAR. BBC TV and BBC Radio reach based on 15+ minutes. BBC TV dedicated news services reach based on 3+ minutes .

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BBC Group Annual Report and Accounts 2018/19

47

DELIVERING OUR PUBLIC PURPOSES

5

To reflect the United
Kingdom, its culture
and values to the world

The BBC’s global services are a pricelessasset for the UK. Today they carry thedistinctive culture, voice and values ofthis country to an audience of more than
426 million people around the world. Thisrole has always been vital for Britain andour influence abroad. At a time when weare seeking to reshape our international
identity and forge new relationships withthe world, it is more important than ever.
This report reminds us that BBC Newsranks number one around the world fortrust, reliability and independence.
Our past year has seen the continued
growth of big state-sponsored news
organisations, which often command vast
resources. Disinformation and ‘fake news’
are the weapon of choice for repressive
regimes everywhere and have become
practised tools for profit or political gain.
With the possibility of state services fromless free countries influencing global
debate and news provision, the value
to democracy and liberty of BBC News
around the world is higher than ever.
This year we continued with the biggest
expansion of the BBC World Service sincethe 1940s. For more than 80 years, theWorld Service has inspired and illuminatedthe lives of millions worldwide. Thanks to
new government funding that recognised
the role of the World Service for Britain
abroad, we have added 12 new language
services, introduced new programming,
increased the number of journalists
on the ground and opened new andexpanded bureaux across the world.
BBC World News continues to provide
consumers with trusted news and analysis,
whilst our English language international
website, bbc.com, is performing welleven in competitive markets like theUSA. Meanwhile, BBC Studios – thecommercial arm of the BBC that now
brings together our production anddistribution operations – is working hard tochampion British creativity overseas anddeliver returns back to the BBC to invest
in more brilliant public service content.

RankedNo.1

for: Trust, Independence, Reliability
Source: BBC Brand Tracker 2018 (ex UK)

64%

17/18

58%

% who agree the BBC helps themto gain a more in-depth
understanding of the news.
Source: BBC Brand Tracker 2018 (ex UK)

Beyond Fake News event, Delhi
48

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

65%

17/18

67%

% of UK adults who think that the
BBC is effective at reflecting the
UK to the world (ineffective: 13%.
17/18: 11%).
Source: Ipsos MORI

Return to contents

BBC Group Annual Report and Accounts 2018/19

49

DELIVERING OUR PUBLIC PURPOSES

Reflecting the United Kingdom,
its culture and values to the world

Throughout the year, we continued tobring the BBC’s impartial, independentjournalism to a world where the media isoften becoming less, not more, free.

We formally opened our new bureauxin Lagos, Nairobi, Seoul and Hong
Kong, with Nairobi now the BBC’s
biggest bureaux outside the UK.

The BBC’s international audience hassoared, with 426 million people now
consuming the BBC globally in the
average week, an increase of 13%. BBCNews has an audience of 394 million
people around the world, a rise of 47
million, or 14%, since last year. These
new audiences come overwhelmingly
from three countries; India, Kenya, andthe USA. India, where BBC News now
operates in nine languages, has become
the top overseas market for BBC News.

Having completed the launch of our 12
new language services, we continued
to introduce new and expanded
programming across the world.

A significant proportion of this risecomes from the expansion of the BBC
World Service, thanks to the funding
boost from the UK government.

One of the most notable innovations
was our television programme Africa
Eye, broadcasting BBC investigative
journalism across the continent, which
has had an often startling impact.
The very first episode of Africa Eye, made in
conjunction with BBC News Pidgin, exposeda deadly addiction to codeine coughsyrup by thousands of Nigerian children.
It led to a ban on codeine-based syrup,announced by the Nigerian government
less than 24 hours after the first screening.

A subsequent episode, which won
the RTS award for News Technology,
forensically analysed a viral video showing
Cameroonian soldiers killing womenand children. After initial claims of ‘fakenews’, the government was forced toacknowledge the incident had happened
and arrested the soldiers involved.
Other investigations have included
exposing corruption in African
football, and rape in South Africa.
Further new African programmes,
broadcast via partner TV stations, include
The She Word, a discussion programme
aimed at women in Africa, What’s New,a children’s news programme, and Life
Clinic, which examines often taboo
health topics. Factfinder is a weekly
programme aimed at demystifying thenews and separating fact from fiction.
The government investment in the
expansion has also funded new global
religion reporters and London-based
specialist reporters on Population,
Cyber Security and the BBC’s first
Gender and Identity reporter.
Building on the BBC’s position as theworld’s most trusted international news
brand, the BBC World Service continued
to spearhead the fight for global media
literacy. Our Beyond Fake News project
was launched in November when we
hosted conferences across India andin Nairobi, with representatives frommajor tech giants as well as attendees
from NGOs, media, and politics. These
conferences discussed the challenges of,and potential solutions to, misinformation.
We ran media literacy ‘Real News’workshops in both India and Kenya, taking
trained World Service staff into schools
to help bolster students’ ability to judge
the news they see as real or fake.

In July 2018 a horrifying video began tocirculate on social media. It showed two
women and two young children being
led away at gunpoint by a group of
Cameroonian soldiers. The captives
were blindfolded, forced to theground, and shot 22 times.

50

The government of Cameroon initiallydismissed the video as ‘fake news’. But
BBC Africa Eye, through forensic analysisof the footage, proved exactly where thishappened, when it happened, and who
was responsible for the killings.
Anatomy of a Killing won an RTS award in
February 2019. The judges said it was “asuperb piece of public interest journalism
which held power to account and had ahuge impact in social media.”

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

New TV discussion programme,
The She Word, is aimed at womenacross Africa

394m
BBC News audience around the world

New BBC-commissioned researchlooked into the role chat apps and social
media play in spreading fake news.
Shockingly, in India at least 31 people
have been killed in the last two years
in incidents involving rumours spreadon social media or messaging apps.
We’ve also extended our Reality Checkoffer, offering dedicated services during
the Nigerian and Indian elections.
The Nigerian elections also saw the BBC
host an ambitious series of Governorshipdebates in Igbo, Hausa, Pidgin and Yoruba.
World Service English has seen
another year of audience growth,
adding 18 million new listeners tomake a total audience of 97 million.
In September we unveiled a newmusical identity for the network, witha signature tune featuring the stringsof the BBC Concert Orchestra.
Our monthly debate programme, World
Questions, has gone from strength tostrength this year, giving audiences
around the world the chance to holdpublic figures to account in locations from
Harare to Vienna to Yerevan, whilst its
TV counterpart, Global Questions, hasrecorded debates from Lagos, Rome,
Jerusalem, Delhi and Hong Kong.

Return to contents

Arts Hour on Tour has also establisheditself as a monthly broadcast, making
waves in cities across the world.
The World Service news teams havemade sense of the year’s biggest events
for its international audience, with news
specials, debates and documentaries
helping to explain the Brexit story.
And newer ways of listening areflourishing. The audience for podcasts
has also continued to grow. Death in Ice
Valley, a collaboration with Norwegianpublic broadcaster NRK, explored anunsolved murder case from nearly 50
years ago and gave rise to an enthusiastic
community of listeners on Facebook
who have been sharing their own
leads and insight into the situation.
Fall of the Shah brought a new kindof drama to World Service English
with a series of different perspectives
on the Iranian revolution 40 years
ago, starring Dame Diana Rigg.
And My Indian Life, presented by Bollywood
star Kalki Koechiln, explores stories
about the rapidly changing experiencesof a new generation of Indians.

BBC Global News, which operates theBBC’s commercially funded international
English news platforms, has continued toflourish. BBC World News, our 24-hour
TV news channel, has offered flagshipprogramming such as HARDtalk, Click and
Beyond 100 Days. bbc.com has launched
BBC Reel, which brings together the bestof the BBC’s world-class digital video
content alongside specially made bespoke
content, for an international audience.
Broadcasting impartial, independentjournalism around the world is notwithout its risks. Sadly, throughout
the year a number of BBC journalists
have been subjected to harassmentand even physical attack.
The BBC has been supporting a campaign
to end the harassment of our BBC Persian
staff and reprisals against their families
by the Iranian authorities. Last March,high level representations were made toboth the United Nations Human Rights
Council and the European Parliament,
where members voted to end these
attacks on freedom of expression.

World Service English can now also beaccessed by a new app which helps people
access news and radio programmes inareas where mobile data is expensive
or internet coverage limited. The
app is available in 35 countries.

BBC Group Annual Report and Accounts 2018/19

51

DELIVERING OUR PUBLIC PURPOSES

Reflecting the United Kingdom,
its culture and values to the world

The BBC has bureaux in 59 countries and75 cities. These include Newsgathering,
BBC World Service, BBC Monitoring,
BBC Global News and Media Action.

BBC Nairobi studio

426m

17/18

376m

Global weekly reach
Including BBC News and BBC Studios.
Source: BBC Global Audience Measure

394m

17/18

347m

BBC News
Total international weekly audience.
Source: BBC Global Audience Measure

52

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

BBC operations and offices
around the world

Asia
Afghanistan

Kabul

Azerbaijan

Baku

Bangladesh

Cox’s Bazaar

Newsgathering

World
Service•

Dhaka
Burma/
MyanmarRangoon/YangonCambodia

Phnom Penh

China

BeijingHong Kong
Shanghai

India

Bangalore
Delhi
MumbaiIndonesia

Jakarta

Japan

Tokyo

JordanAmman

Kyrgyzstan

Bishkek

LebanonBeirutNepal

Kathmandu

Pakistan

Islamabad
Karachi
LahorePalestinian
Territories

Gaza City

Singapore

Singapore

South Korea

Seoul

TaiwanTaipeiTajikistan

Dushanbe

Thailand

Bangkok

UAE

Dubai

Uzbekistan

Tashkent

Ramallah

•
•
•
•
•
•
•
•
•
•
•
•
•
•

Buenos Aires

Brazil

Sao Paulo

CanadaTorontoMexicoMexico City

USA

BostonChicagoLos Angeles
Miami
New York &UN
San Francisco
Washington

319m

•

Media
ActionBBC Global BBC
News
Studios

Australia

•
•
•
•

•
•

•
•

•
•
•
•
•
•

•

•
•
•
•

•

•

Belgium

Brussels

FranceParis

Georgia

TbilisiGermany

BerlinCologne

Italy

Rome

LatviaRiga

PolandWarsaw•

RussianFederation

Moscow•

SerbiaBelgrade

Switzerland

Geneva (UN)TurkeyIstanbul

UkraineKiev

Newsgathering

•

•
•

•

•
•
•
•

BurundiBujumbura

Cote d'Ivoire

Abidjan

DR Congo

Kinshasa

Egypt

Cairo

Ethiopia

Addis Ababa

Ghana

Accra

Iraq

BaghdadIsraelJerusalem

Kenya

Garissa

Nigeria

Abuja

Nairobi
Lagos
Rwanda

•

•
•

•

•

•
•
•
•
•
•
•

KigaliSenegalDakar

Sierra Leone

Freetown

Somaliland

HargeisaSouth Africa

Johannesburg

South Sudan

Juba

Tanzania

Dar Es Saleem

Tunisia

Tunis

UgandaKampalaZambiaLusakaZimbabwe

HarareWorld
ServiceBBC
MonitoringMedia
ActionBBC Global BBC
News
Studios

•
•
•
•
•
•
•
•
•
•

Africa

•
•

•
•

•
•

•
•

•

•
•
•
•
•

SydneyEurope••••BBC operations and offices
around the world

Australasia••

Americas
Argentina••

BBC
Monitoring

•
•
•
•
•
•

•

•

•

•

•

•
•
•
•

•

•
•

•
•

•
•
•
•
•
•
•
•
•
•
•
•
•
•

•
•

•

•

•
•

•
•
•
•

•

•
•
•

•
•
•
•

•

•

•

17/18

279m

138m

55m

17/18

111m

17/18

42m

BBC World Service weekly reach
Includes TV, radio, online and social
media in English and other languages.

BBC World Service television
weekly reach
Non-English languages.

BBC World Service online andsocial media weekly reachEnglish and other languages.

Source: BBC Global Audience Measure

Source: BBC Global Audience Measure

Source: BBC Global Audience Measure

173m

101m

42m

17/18

160m

17/18

95m

17/18

37m

BBC World Service Audio
weekly reachEnglish and other languages.

BBC World News TV channel*
weekly reachEnglish language global news channel.

bbc.com* and social media
weekly reachInternational English language digital.

Source: BBC Global Audience Measure

Source: BBC Global Audience Measure

Source: BBC Global Audience Measure*

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BBC World News channel and bbc.com are commercially funded.

BBC Group Annual Report and Accounts 2018/19

53

DELIVERING OUR PUBLIC PURPOSES

Reflecting the United Kingdom,
its culture and values to the world
BBC World Service has seen significant growth this year with TV, audio and digital all performing strongly. However, challenges withsyndicated TV in some markets, changing patterns of audience behaviour and changes in the political environment have affected theperformance of some services.
BBC World Service weekly people reach across all platforms, by service

World Service English
Afrique
ArabicAzeri
Bengali
BrasilBurmeseChineseGreat Lakes
Hausa
Hindi
Indonesian
KyrgyzLearning English
Mundo
Afaam Oromoo
Amharic
Pidgin
Igbo
KoreanMarathi

2018/19
Millions

2017/18
Millions

Year-on-yearchange
%

96.6
12.5
43.8
0.2
12.1
6.5
5.3
1.1
1.4
23.6
19.2
4.8
3.1
2.3
7.6
0.1
0.2
6.2
1.2
0.9
2.0

78.8
12.0
44.3
0.1
16.4
5.6
4.2
1.1
1.4
24.6
11.8
4.0
3.1
2.3
7.2
n/a
n/a
n/a
n/a
n/a
n/a

22.5%
3.5%
-1.1%
137.5%-26.5%
17.4%
26.2%
7.1%
0.2%
-3.9%
62.1%
20.9%
0.6%
0.6%
5.3%
n/a
n/a
n/a
n/a
n/a
n/a

Nepali
PashtoPersianRussianSinhalaSomali
Swahili
Tamil
Thai
TurkishUK China
Ukrainian
Urdu
Uzbek
Vietnamese
Punjabi
TeluguTigrinya
YorubaGujarati
Serbian2018/19
Millions

2017/18
Millions

Year-on-yearchange
%

5.3
10.2
20.8
4.1
0.9
5.9
19.1
11.6
1.7
1.9
0.1
3.8
7.5
2.3
1.3
0.4
7.9
0.1
1.7
3.1
0.1

5.3
10.1
22.5
2.9
0.9
3.6
16.1
9.8
1.1
1.7
0.1
3.6
7.8
2.3
1.0
n/a
n/a
n/a
n/a
n/a
n/a

0.7%
0.9%
-7.4%
43.2%
8.5%
62.6%
19%
18.9%
56.8%
12.6%
-7.6%
4.9%
-3.7%
2.4%
32.8%
n/a
n/a
n/a
n/a
n/a
n/a

The Global Audience Measure is an annual update of how many people are consuming the BBC weekly for all services in all countries across all platforms (Television, Radio, website
and social media). Key to this is de-duplication i.e. ensuring that a person who consumes multiple BBC services or platforms or on multiple devices is not counted many times in the
top level totals. For example, BBC World Service television, radio and online audience is less than the sum of its parts to ensure we do not count people more than once whenlooking at the total World Service audience.
Notes: Individual service level data for 2017/18 for the new services launched as part of the World Service expansion was not available because these services had not yet had a fullyear of operations.
Reach data reported is rounded to only one decimal place. The increases or decreases shown are based on unrounded data.
English language syndicated TV for Africa reaches 38.5 million people but is not shown in the table above as it is not a service.

54

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

Audiences andexternal context

p.56
Market context

p.64
Audience engagement

This section sets out audience performance this year andexplains how we have sought the views of and listened toaudience members around the UK. It shows how the BBCis performing within the competitive UK market, as well assummarising our work to support charitable causes and tobe as sustainable as possible.

Return to contents

The Zoe Ball Breakfast Show, BBC Radio 2

BBC Group Annual Report and Accounts 2018/19

55

PERFORMANCE

Audience performance and market context
Changes in how people consume media
continue to be rapid and profound,especially so among younger audiences.
2018/19 saw the steepest year-on-year
drop in the amount of broadcast TV
watched by under 35s on the TV set – downaround two hours per week in a year toten-and-a-half hours. By contrast, the timethey spent using the TV set for purposesthat include SVOD, YouTube and gaming
increased again – up an hour a week toeight hours weekly. Music streaming by
young adults also rose by around an houra week to almost six hours weekly. Aroundthe same proportion of under 16s now use
YouTube each week as use the BBC (81%).
While these changes have so far affectedyoung audiences the most, increasingly
they impact the media behaviours ofolder audiences. For example, in 2018/19
more than half of over 35s used the
TV set for purposes such as SVOD,
YouTube and gaming and one in six usedmusic streaming services each week.
Within this changing landscape, the time
people spend with the BBC is trending
downward year-on-year for both BBC
TV and BBC Radio. The BBC is still the
media provider that UK adults overall use
the most, and audience performance forthe year was within the target range set
out in the 2018/19 BBC Annual Plan*.
91% of online adults used the BBC eachweek in 2018/19, in line with the targetof 88-93%. UK adults spent 18 hours
on average per week consuming BBC
services, down on the year but within thetarget range of 17:15-18:45. They rated
the BBC at seven out of ten, on average, interms of their general impression, scoredthe quality of programmes and services
at seven out of ten and value for money
at five out of ten, all within target.
In terms of fulfilling the mission and public
purposes, over 70% of adults continue tothink that the BBC is effective at delivering
its mission to inform, educate and entertainin 2018/19**. And across all audiencegroups regardless of age, gender, social
grade, ethnic origin or geography, a clear
majority rate the BBC as effective. The
majority of UK adults overall also thinkthat the BBC has delivered each element of
the purposes effectively, with the highest
scores for helping people understand what
is going on in the UK and world today, andfor the quality of content and services.
Scores for most mission and purposesmeasures are steady statistically comparedwith 2017/18. There were some smallchanges in the ratings for the news,
learning and global purposes, and forsome quality and distinctiveness scoresfor BBC TV, BBC Radio and BBC Online
56

among their weekly users. In each casethough, the majority of UK adults overall
continued to rate the BBC as effective, wellahead of a minority saying ineffective.
Despite these outcomes overall,there are significant differences in the
consumption and impact of BBC output
between different audience groups.
Across each audience group, the largest
number of people continued to feel that the
BBC has delivered its mission and purposes.
In each age band, gender, social grade, andarea of the UK, and among white and BAME
audiences, the proportion rating the BBC
as effective on each measure outnumberedthose saying ineffective by a considerable
margin. But some of those with lower levelsof usage of the BBC compared with theircomparative groups – C2DE groups, BAME
audiences, those in Northern Ireland andyounger people – were among those who
tended to give lower effectiveness scores.
As well as reflecting the relative appealof the BBC’s offer, the absolute level ofusage can vary, in part, owing to the extent
of competition aimed at different groups,
and different generations and life stages.
For example, effectiveness scores for the
mission and across the purposes werelower among C2DE than ABC1 groups.
BAME audiences gave lower scores thanwhite audiences for the extent to which
the BBC caters for a wide range of tastes
and reflects and is relevant to them.
Effectiveness ratings in Northern Irelandtended to be lower than the UK average fordelivery of the mission and the creativity
purpose. In addition, audiences in Walesgave lower scores for the representation
purpose as did people in Northern England

91%

17/18

92%

Adult reach% of UK adults in online
homes who use BBC
Television, Radio or Online
each week.

when rating the extent to which the BBC
caters for and reflects their area as well as
elements of the news purpose. Audiencesin the Midlands gave a lower score fordelivery of the mission than last year.
Usage of the BBC is under particularpressure among young audiences withintense competition from both longstanding broadcasters and newer media
providers. Compared with audiences
overall, 16-34 year olds are less likely tofeel that the BBC reflects and is relevantto them. They and those aged 35-54
also gave lower effectiveness scoresthan 55+ for the delivery of elements of
the news purpose and for the creativity,
quality and distinctiveness purpose.
Year-on-year changes in ratings weremost apparent among 35-54 year olds
with some of their scores – whilst still
positive – moving downward and nearer
to those of 16-34. Changes in media
behaviour are intensifying for this age
group – 11 million subscribed to a SVOD
service in 2019, up 1.3 million in a year.
We continue to seek to narrow gaps inconsumption and impact of the BBC, andto respond to the continuing structuraland competitive challenges as weprioritise reinventing the BBC for a newgeneration. With the range of choices
available, we are working to keep pace tomaintain the relevance of public service
broadcasting to younger generations.
Notes:* Broad goals were set as the BBC continues to improve
the audience measurement systems it uses which
introduced some uncertainty into the objectivesetting while migration to the new approaches
completes this year.
Ipsos MORI, 3,551 UK adults 16+, March to May 2019** average score across informing, educating andentertaining people in the UK and them.

18:00

17/18

19:12

7/10

17/18

7/10

Total time spent
Length of time UK adultaudiences spend
with the BBC each week.

General impression
UK adults’ general
impression of the BBC(mean score out of 10)

Target: 17:15-18:45 (hh:mm)

Target: 6-7/10

5/10

Sources: Ipsos MORI; BARB,BARB Establishment Survey,
RAJAR, Adobe Digital
Analytics(DAx); Kantar Media.

Target: 88-93%

7/10

17/18

7/10

How UK adults rate theBBC on providing highquality programmes andservices(mean score out of 10).

17/18

6/10

How UK adults rate theBBC on providing value
for money(mean score out of 10).
Target 5-6/10

Target: 6-7/10

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

Weekly reach of BBC Television and Radio compared withother providers
Television set
Weekly reach

All BBC Television

All ITV television

All Channel 4
television

All Channel 5
television

Other broadcast
TV channels

Other uses of the
TV set*Adults aged 16+

77.9%

68.2%

58.7%

43.6%

68.0%

58.4%

2017/18: 80.2%

2017/18: 69.7%

2017/18: 62.2%

2017/18: 44.9%

2017/18: 70.6%

2017/18: 55.3%

56.2%

50.2%

45.2%

25.8%

53.3%

67.4%

2017/18: 60.4%

2017/18: 53.2%

2017/18: 50.8%

2017/18: 29.0%

2017/18: 58.4%

2017/18: 64.6%

Young adults 16-34

Source: BARB (TV-owning households), 15+ minutes’ consecutive reach.
* Include SVOD, gaming, DVDs.

Radio services/music streaming
Weekly reach

All BBC RadioAll commercial
radioMusic streaming

Adults aged 15+

62.4%

65.4%

25.0%

2017/18: 64.2%

2017/18: 65.4%

2017/18: 20.5%

50.8%

69.6%

46.0%

2017/18: 53.0%

2017/18: 70.8%

2017/18: 40.8%

Young adults 15-34

Source: BBC and commercial radio from RAJAR, 15-minute reach. Music streaming estimates from MIDAS/RAJAR.

Time spent using the TV set for different purposes per week
2013/14-2018/19, hours:minutes

Time spent using radio services/music streaming per week
2013/14-2018/19, hours:minutes

Adults aged 16+: Average weekly time per head (hours:minutes)

Adults aged 15+: Average weekly time per head (hours:minutes)

All BBC television

09:34

Other broadcast TV channels

07:29

All ITV television

06:35

Other uses of the TV set*

07:36
07:03
05:49

10:33

All Commercial Radio

08:17

09:28
08:32

Music streaming

05:25

All Channel 4 television

03:09
02:05

02:28

All Channel 5 television

01:45

01:33

2013/14* Includes SVOD, gaming, DVDs.
Source: BARB (TV-owning households).

Return to contents

All BBC Radio

2014/15

2015/162016/172017/18

2018/19

02:32
00:47
Source: BBC and commercial
radio from RAJAR. Music
streaming estimates from
MIDAS/RAJAR.

2013/142014/15

2015/162016/172017/18

BBC Group Annual Report and Accounts 2018/19

2018/1957

PERFORMANCE

Performance by service
Last year’s Annual Report saw a shift in the way we measure our performance; moving from a review of performance by platform (i.e.
television, radio, news, online) to a review of our performance measured against each of the public purposes. However, for comparability
with earlier Annual Reports, we have included performance by service where the data exists.
Television performance by service
Network
television

Content
We spent a total of£1,678 million onthese services in
2018/19

Reach
UK population
who use the service
each week

Time spent watchinga channel each week
Length of time theaverage viewer spenteach week withthe service

Costs per user hour
How much it costs todeliver each service
for each hour used

BBC One is our flagship service and the UK’s mostpopular television channel. It unites and inspires thenation with high-quality programmes across a range ofgenres that includes news and current affairs, drama,
comedy, entertainment and factual.

£1,106m

66.7%

07:02

7p

2017/18: £1,009m

2017/18: 68.9%

2017/18: 07:21

2017/18: 6p

BBC Two is a mixed-genre channel with programmes ofdepth and substance. It includes the greatest amountand range of knowledge-building programming on theBBC, complemented by distinctive comedy, drama andarts programming.

£381m

41.3%

03:00

9p

2017/18: £374m

2017/18: 44.6%

2017/18: 03:07

2017/18: 8p

BBC Four aims to be British television’s mostintellectually and culturally enriching channel, offering
an ambitious range of UK and international arts, music,
culture and factual programmes.

£44m

11.8%

01:43

6p

2017/18: £38m

2017/18: 12.7%

2017/18: 01:45

2017/18: 5p

The CBBC channel offers a distinctive mixed schedulefor 6-12 year olds, with mainly UK programmes servedin a stimulating, creative and enjoyable environment.

£62m

3.4%

02:25

19p

2017/18: £68m

2017/18: 3.9%

2017/18: 02:33

2017/18: 17p

CBeebies provides a mix of high-quality, mostly
UK-produced, programmes designed to encouragelearning through play in a consistently safe environment
for children under six.

£30m

6.3%

04:07

3p

2017/18: £30m

2017/18: 7.3%

2017/18: 0 4:13

2017/18: 3p

The BBC News Channel is a 24-hour impartial andindependent news service offering breaking news,
analysis and insight. It provides fast and comprehensive
coverage of local, UK and international events asthey unfold.

£53m

8.2%

02:56

7p

2017/18: £50m

2017/18: 9.5%

2017/18: 02:46

2017/18: 6p

BBC Parliament is the UK’s only channel dedicated topolitics. It shows debates and committees from
Westminster, Holyrood, Stormont, Cardiff Bay andStrasbourg as well as political programmes from acrossthe UK.

£2m

0.7%

02:07

4p

2017/18: £2m

2017/18: 0.5%

2017/18: 01:45

2017/18: 5p

Reach definition: 15+ minutes consecutive for all services and audiences in TV-owning households aged 4+.
Sources: BARB (TV reach and time per viewer – all channels include their simulcast HD channel where applicable).
N.B. BARB data available for the full 2018/19 financial year measures TV set viewing only, meaning that iPlayer viewing on other devices is not included in any of the reach and time
figures. iPlayer viewing is growing, especially for young-skewed services such as CBeebies and CBBC.
Cost per user hour data does include viewing on the TV set and other devices.
CBBC: among its target audience of 6-12 year olds reach was 16.0% and time spent per viewer was 02:52 (based on 15+ minute reach). Based on 3+ minute reach, reach was 20.1%
of 6-12 year-olds and time spent per viewer was 02:17.
CBeebies: among its target audience of 0 -6 year olds (measured as children aged 4-6 and housepersons with children aged 0 -3) reach was 33.1% and time spent was 04:40 (basedon 15+ minute reach). Based on 3+ minute reach, reach was 40.0% of 0-6 year-olds and time spent per viewer was 03:52.
Three-minute reach for BBC News channel and BBC Parliament – in line with industry standards – would be 11.7% and 1.4% respectively (13.1% and 1.6% among 16+ population).

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BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

Radio performance by service
Network radio

Content
We spent a total of£304 million on these
services in 2018/19

Reach
UK population
who use the service
each week

Time spent listening
to a service eachweek
Length of time theaverage listener spenteach week withthe service

Costs per user hour
How much it costs todeliver each service
for each hour used

BBC Radio 1 broadcasts a distinctive mix of new musicand entertainment for 15-29 year olds, as well as
providing tailored news, documentaries and advice
campaigns for young adults.

£40m

17.0%

06:21

1p

2017/18: £37m

2017/18: 17.7%

2017/18: 0 6:18

2017/18: 1p

BBC 1Xtra plays the best in contemporary black music,
with a strong emphasis on delivering high-quality live
music and supporting new artists.

£7m

1.9%

04:17

3p

2017/18: £6m

2017/18: 1.9%

2017/18: 04:40

2017/18: 3p

BBC Radio 2 broadcasts a unique mix of music andspeech programmes covering a diverse mix of live pop
and rock, comedy, documentaries and religious output,
as well as running social action campaigns to over
14 million listeners.

£50m

27.2%

11:55

1p

2017/18: £49m

2017/18: 28.1%

2017/18: 11:54

2017/18: 1p

BBC Radio 3 centres on classical music, around which it
provides a broad spectrum of jazz, world music, arts
programmes, religion and drama. There is a strongemphasis on musical performance across the UK.

£39m

3.5%

06:08

6p

2017/18: £38m

2017/18: 3.7%

2017/18: 05:56

2017/18: 6p

BBC Radio 4 is a mixed-speech radio station, offering
in-depth news and current affairs and a wide range ofother speech programmes including drama, readings,
comedy, factual and magazine programmes.

£96m

19.3%

10:59

2p

2017/18: £91m

2017/18: 20.6%

2017/18: 11:02

2017/18: 1p

Originally launched in 2002 as BBC 7, the station was
relaunched in April 2011 as BBC Radio 4 Extra. The
digital-only network is the principal outlet for the BBC’sarchive of speech entertainment, including comedy,
drama and readings.

£3m

3.8%

06:17

<1p

2017/18: £3m

2017/18: 4.0%

2017/18: 05:38

2017/18: 1p

BBC Radio 5 live broadcasts continuous news and live
sports coverage, bringing major news stories and sports
events to its listeners as they happen, and providing
context through wide-ranging analysis and discussion.

£46m

9.2%

06:38

3p

2017/18: £44m

2017/18: 9.7%

2017/18: 06:34

2017/18: 2p

BBC Radio 5 live sports extra brings a greater choice oflive action to sports fans by extending live coverage ofvarious sporting events.

£3m

1.9%

03:08

1p

2017/18: £3m

2017/18: 2.3%

2017/18: 03:19

2017/18: 1p

BBC 6 Music is a digital radio station that entertains
lovers of popular music with a service that celebrates
the alternative spirit of popular music from the 60s to
the present day, complemented by music news anddocumentaries.

£12m

4.4%

09:20

1p

2017/18: £11m

2017/18: 4.4%

2017/18: 0 9:12

2017/18: 1p

BBC Asian Network offers speech and music appealing
to British Asians, with a focus on news and current
affairs. It broadcasts mainly in English, but does offersome programmes in other languages.

£8m

1.1%

05:12

5p

2017/18: £7m

2017/18: 1.2%

2017/18: 05:19

2017/18: 4p

Reach definition: 15+ minutes for all services and audiences aged 15+.
Sources: RAJAR (Radio reach and time per listener.
Radio 1: among its target group of 15-29 year-olds reach was 31.8% and time spent per listener was 06:04.
1Xtra: among 15-24 year-olds reach was 5.6% and time spent per listener was 03:20.
Radio 2: among its target group of 35+ year-olds reach was 33.7% and time spent per listener was 12:45.
Asian Network: among its target group of Asians under 35 reach was 13.8% and time spent per listener was 03:59. Ethnicity definitions in RAJAR from FY 2014/15: Asian = White &Asian, Indian, Pakistani, Bangladeshi, Any Other Asian Background.

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BBC Group Annual Report and Accounts 2018/19

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PERFORMANCE

Online performance by service

BBC Online comprises the BBC’s portfolio of online
products on desktop, connected TV, mobile and tablet,
including news, sport and weather; our children’s
services CBBC and CBeebies; and Knowledge &Learning – as well as IP-delivered TV and radio services,with both live and on-demand programmes available on
BBC iPlayer.

Content
We spent a total of£214 million on these
services in 2018/19

Reach
UK population
who use the service
each week

Time spent using
a service each week
Length of time theaverage user spenteach week withthe service

Cost per user reach
How much it costs todeliver each service toindividual users

£214m

n/a*

n/a

n/a

2017/18: £182m

2017/18: n/a

2017/18: n/a

2017/18: n/a

Reach% of 16-34 year olds who use the service each week
BBC Three is constantly innovating to provoke thought
and to entertain audiences from 16 year-olds to30-somethings with original comedy, drama and factual
programming that celebrates new British talent.

8%
2017/18: 8%* As page 27 shows, BBC Online reaches 77% of UK adults per month.
Source: BBC modelled data using inputs from: Facebook, Comscore, BARB, Cross-Media Insight Survey. UK 16-34 year-olds.

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BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

Public Service Broadcasting expenditure
The table below illustrates how licence fee funds have been spent during the current and prior year, including the Charter requirement
for the BBC to report on expenditure on the UK Public Television Services by genre (as defined in accordance with industry standards).
Total content spend represents the cost of making content across the BBC’s services. The total service spend represents the full costof producing, supporting and delivering BBC content to audiences.
World Service operating licence
The BBC committed to protect its annual spend on World Service for a period of five years from 1 April 2017 to ensure it remains
a valued public broadcaster for the future. In order to deliver this commitment, the BBC must spend at least £254 million per annumon this service over this period. Including content, distribution and general support costs, £278 million (2018: £268 million) was spenton the BBC World Service operating licence.
World Service grant funding
In 2016/17 the Foreign & Commonwealth Office (FCO) awarded a grant to the BBC of £291 million, to be spent over the following
four years, to assist in the expansion of the World Service.
PSB expenditureNews and Current Affairs
Factual and Learning
Film and Drama
Entertainment and Comedy
Sport Production
Children’s
Other television content spend
Television services by genre
Radio

2019
£m

2018
£m

355
311
333
175
76
83
366

319
294
340
177
65
89
295

1,699

1,579

504

480

214

182

Content spend on services by platform

2,417

2,241

Orchestras and performing groups
S4C (service spend)
Development spend
BBC World Service grant
BBC World Service operating licence*

29
22
67
93
234

27
26
44
58
227

BBC Online

Other service spend

445

382

Total content spend

2,862

2,623

194
490
185

207
418
196

3,731

3,444

103
94
6
–
165
25

101
160
6
267
152
13

4,124

4,143

(48)

(48)

4,076

4,095

Distribution costs
Content and distribution support
General support
Total service spend
Licence fee collection costs
Other obligations (S4C, Local TV, Broadband roll-out)**
Monitoring
PSB pension deficit reduction payment***
Costs incurred by PSB to generate non-licence fee income
Restructuring costs
Total PSB expenditure
Lease reclassification****PSB expenditure
*
**
***
****

The BBC World Service operating licence includes distribution spend of £33 million (2018: £36 million).
Under the terms of the 2015 licence fee agreement, the BBC has committed to contribute funding towards broadband roll-out across the UK and for the development ofLocal TV channels.
Pension deficit payment formed part of staff costs in the year and consequently recognised within core spend.
In order to reflect the full cost of PSB expenditure by service, finance lease interest is included, although it is not included in the Group operating expenditure.

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BBC Group Annual Report and Accounts 2018/19

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PERFORMANCE

Charitable work
The BBC has been broadcasting appeals
on behalf of charities since 1923. Each
year, these appeals and telethons raise
millions of pounds benefiting individuals,
communities and organisations across the
UK and around the world. BBC audiences
get involved, taking on challenges andraising money. This year BBC Children in
Need announced that it has raised over
£1 billion since its first telethon in 1980.
You can read here about the range ofcharity appeals on the BBC.
BBC Broadcast Appeals
The BBC gave a number of charities theopportunity to broadcast appeals last year.
60 charities got the chance to make either
a BBC One Lifeline appeal or a Radio 4
appeal. Over £1.3 million was raised for awide range of causes. 15 charities madebroadcast appeals on BBC Television
and Radio in Northern Ireland. The
BBC Radio Bristol Alive Appeal funded
activity sessions for elderly people withdementia. There was a new record total,£3.4 million, for the BBC Radio 4 Christmas
Appeal with St Martin-in-the-Fields.
The BBC also broadcast an Indonesian
Tsunami and a Cyclone Idai appeal for
the Disaster Emergency Committee.
For more information about all theseappeals visit: bbc.co.uk/charityappeals.
Media Action
BBC Media Action tackles poverty andinequality with support for independent
media and creative communications thatinspire, inform and connect. We reached
80 million people around the world in
2018/19, with work ranging from theprovision of lifesaving information to
Rohingya refugees in Bangladesh, toprogrammes that encouraged millionsof Nigerian voters to participate in
the General Election and helped them
identify fake news and misinformation.
Media Action is not funded by the licencefee, and instead relies on donors to carryout its vital work. Find out more:
mediaaction.org.
BBC Children in NeedIn 2018, the BBC inspired the nation to
support the charity through an array of
special programming including The One
Show’s Rickshaw Challenge, Countryfile
Ramble, Stacey Dooley’s documentary on
homelessness, and The Radio 2 Breakfast
Show’s incredible fundraising auction andprize draw.

62

The One Show’s
Rickshaw Challenge for
BBC Children in Need

£1bn
Raised by Children in Needsince 1980

The Appeal Show delivered anotherglittering night of entertainment with afundraising total of around £50.6 million
announced at the end of the show, meaningthat over £1 billion has been raised since1980. Thanks to our supporters, the charity
is currently funding over 2,800 projects
working with disadvantaged children andyoung people throughout the UK. For
more information visit: bbc.co.uk/Pudsey.
Comic Relief
Red Nose Day 2019 saw exceptional
involvement across the corporation
including Children’s TV, News programmes,
The One Show, Countryfile, Saturday
Kitchen, The Apprentice plus Radio 1 andRadio 2 challenges. Highlights included
an inspiring Kilimanjaro documentaryfeaturing moving appeals, the longest everDanceathon and a live entertainment showon the BBC with Bodyguard, Alan Partridge,
Top Gear, Famalam, and University Challenge
collaborations and a much-anticipated
Four Weddings and a Funeral followup. To date over £65 million has beenraised – a spectacular amount to support
projects in the UK and internationally.
Only using BBC output could this national
charitable effort be achieved. For more
information visit: comicrelief.com.

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

Environmental sustainability
The BBC’s environmental ambitions are
greater than ever. Our programmes andcontent, including BBC One’s Drowningin Plastic and 5 live’s Cool Planet season,
have informed and inspired audiences
about global environmental challenges.
Our new strategy, ‘Greener Broadcasting’,highlights our objective of “creating a
positive environmental impact”. The
strategy covers our direct operational
impact, our work within the wider
broadcasting industry and the content
of the programmes we produce andbroadcast. We have made progressin all these areas.
We have broadcast a wide variety ofenvironmentally-themed programmes
on TV, radio and online
We know that audiences care about theenvironment and want to see more on the
topic. In 2018/19 series such as Costing
the Earth on Radio 4 and Countryfile on
BBC One highlighted environmental
matters weekly. Stacey Dooley Investigates:
Fashion’s Dirty Secrets examined theimpact of the fashion industry for BBC
One, while The Mash Report on BBC
Two used comedy to discuss climatechange. Online, BBC Ideas curated a‘Sustainable Thinking’ playlist featuring
cutting-edge sustainability themes.

We are making our buildings and ouroperations more sustainable
Our new building in Central Square Cardiff
has been designed with sustainablefeatures – a roof garden, rainwater
harvesting and solar panels to generate
electricity. In two of our large buildings,
New Broadcasting House in London and
the Mailbox in Birmingham, we haveupgraded to LED lighting to reduce
the amount of electricity we use.
Last year, inspired by our Blue Planet II
series, the Director-General announced
our intention to remove single-use
plastics from BBC operations by the endof 2020. Since then we have removed
plastic cups, cutlery and containers fromall canteens and kitchen areas run by
BBC Workplace. We are now working
to remove avoidable single-use plastic
from the rest of our operations.
Greener BBC targets and measures

CO2e*

EnergyWaste

We have trained hundreds of people tohelp them deliver informed content
Our new training course, ‘Reporting
Climate Change’, gives journalists
working in TV, online and radio a greater
understanding of the causes and impactsof climate change and an opportunity to
discuss how the issue can be covered. We
have trained more than 500 journalists
and this will continue in 2019/20. Teamsfrom BBC Content have received similar
training. In addition, we have createda short online course called Greener
Broadcasting which gives an introduction
to environmental issues at the BBC.
Our production teams are reducing waste
and carbon emissions
We remain committed to making ourcontent in a more sustainable way. Since
April 2018, 65% of the programmes
commissioned by BBC Content and
BBC Children’s have calculated theircarbon footprint using the BAFTA‘Albert’ calculator. 157 programmes,
including BBC One’s EastEnders, BBC
Two’s Humpback Whales: A Detective
Story and Cbeebies’ The Baby Club
achieved Albert sustainable production
certification to recognise their efforts
in reducing environmental impact.
We collaborate with our colleagues
at the BAFTA Albert Consortium toensure the certification scheme raises
standards across the industry.
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We are committed to achieving ourenergy and waste targets
We continue to purchase renewable energy,
enabling us to achieve our greenhousegas emissions reduction target in linewith an internationally recognised‘science-based’ methodology. Our energy
consumption has not changed comparedto the baseline. We will be taking action to
improve upon this in the next 12 months.
The amount of waste we produce isnow 25% lower than the baseline.
But the reported amount of waste werecycle has declined and the amount
we send to landfill has increased
compared to the previous year; again,
we will take steps to address this.
The table below summarises performanceagainst targets. More detail is available
at: bbc.co.uk/responsibility/environment.

Target/measure by 2022(baseline 2015/16)

Progress 2018/19 vs 2015/16

ReduceReduced by

24%

78%

ReduceReduced by

10%

0%

ReduceReduced by

10%

25%

RecycleRecycled

75%

50%

Zero waste to landfill

Waste to landfill

14%
Programmes

No single-use plastic by 2020

In progress

100%

65%

Albert calculation

calculated

25%

48%

Production carbon Albertcertifiedcertified157
programmes*

CO2e reduction target addresses scope 1 and 2 emissions, following sectoral decarbonisation approach
science-based target methodology

Below we describe our greenhouse gas emissions and carbon intensity (gross and net),
which we monitor and disclose annually.
Greenhouse gas emissions 2018/19‘Gross’ emissions‘Net’ emissions

Greenhouse gas emissions (tonnes
CO2e emissions, scope 1 and 2)

67,201

20,999Carbon intensity (tonnes CO2eemissions/total group income £m)

13.7

4.3

Greenhouse gas data is for UK-based and representative World Service bureaux. ‘Gross’ emissions uses location-based
grid average factor. ‘Net’ accounts for renewable electricity.

BBC Group Annual Report and Accounts 2018/19

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PERFORMANCE

Audience engagement report
The BBC’s Charter requires us to “carefully
and appropriately assess the views andinterests of the public and audiences,including licence fee payers, across thewhole of the United Kingdom”.
The BBC has a number of ways ofachieving this, including extensive
market research, audience measurement
using both industry surveys and the BBC’s
own bespoke measurement and audiencepanels, and a dedicated 24 hour contact
centre that deals with all contacts withthe general public 365 days a year andfeeds this back within the BBC.

Key themes raised by the audience inthe sessions— The audience is very ‘digital’ now– they tend to fully embrace and value
what digital services offer – control,
choice, and ease of discovery are very
important to them and they often
judge media providers throughthat lens.

In addition to this regular activity, acrossthe year the members of the BBC Board
and Executive Committee met with andheard directly from representatives of ouraudience in eight sessions. Held in different
locations across the UK, we focused on
sections of the audience that engage lesswith our output. These sessions were heldin the following locations and included
people from a wide range of backgrounds:—

BBC iPlayer is highly valued, but canbe seen as a catch-up option fromtime-to-time rather than a destinationin its own right, so can be viewed as
inferior to services such as Netflix orYouTube in terms of the amount ofavailable content.

—

But it’s not all about digital – there is
still a real appetite for TV that allows
the audience to just sit back and relax
in front of, as well as ‘appointment’
TV programmes. People feel the BBC
should bear this in mind, and theywould welcome more of this ‘easy
viewing’ from the BBC.

—

Overall there is a lot of respect for the
BBC – the BBC is generally seen as
high quality, authoritative andtrustworthy. There is also a lot ofaffection for individual BBC services
and programmes.

1.

Birmingham – aged 24-45

2.

Peterborough – aged 18-24

3.

Antrim – aged 18-34

4.

Swansea – aged 18-34

5.

Dundee – aged 18-34

6.

Salford – aged 30-50

7.

Margate – aged 40-60

8.

Tower Hamlets, London – aged 25-45

The sessions involved around 170 people
and included an equal mix of men andwomen. Over the course of two hours
participants discussed their media
consumption, their attitudes towards the
BBC and how it portrays their lives, andtheir views on the BBC of the future. At
the end of each session the participants
were given an opportunity to ask
questions of the BBC representatives.

—

But given the BBC’s wide remit it cansometimes feel less ‘relevant’ to theirlives and not ‘for me’ – portrayal canbe a factor in this lack of relevance– there are concerns amongst someblack audiences, younger audiences
and those from the nations that theway they are represented andportrayed could be more frequent,more authentic and more nuanced.

“Very positive that the BBC islistening to different views directlyfrom grass roots viewers”
Tower Hamlets, male, age 45

64

BBC Group Annual Report and Accounts 2018/19—

People tend to trust the news, butthere are some concerns about
representation – there is also a sensefrom the range of places we visitedthat their part of the UK can get a raw
deal from the media in general (not justthe BBC) – they can feel ignored,
misrepresented or even disparaged.

—

Many would like the BBC to ‘lighten
up’ a bit – maybe adopt a more lively
tone, and be more positive – news, inparticular, was seen by many as too
serious, depressing and missing out
on positive stories.

—

Although many feel the licence fee
offers good value – there were someconcerns about the amount they getfrom it and many are unclear of exactly
what services it pays for.

—And not everyone knows what they
get from the BBC – there are someissues with knowing what content hascome from the BBC, particularly if it
has been consumed on someone
else’s platform.

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S T R AT E G I C R E P O R T

Clockwise from top left:
Charlotte Moore (l), Directorof Content, with audience
members in Salford
Sir David Clementi (r),BBC Chairman, with audience
members in Margate
Sir Nicholas Serota (r),non-executive director,
with audience members in
Tower Hamlets, London

Plans for 2019/20
We plan to carry out further sessions in
2019/20 to gain more feedback around
topics and themes that reflect the BBC’s
priorities including iPlayer and Sounds,
News, the new BBC Scotland channel anda focus on local provision, particularly
local radio. We will again engage with abroad range of people across the sessions
and will visit different locations.
We are also planning other new ways tobetter engage with our audiences,including:

Return to contents—

Developing a series of face-to-facesessions for a wider range of BBC staff
beyond the Board and Executive
Committee to meet the audience
they serve.

—

Arranging for more staff to carryout ‘accompanied listening’ at the
Audience Services contact centre in
Belfast to listen-in to the audience
members who contact us directly.

BBC Group Annual Report and Accounts 2018/19

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C O M M E R C I A L O P E R AT I O N S

Commercial
operations

The BBC’s commercial subsidiaries support the BBC public
service mission and generate income for the BBC Group.
These companies maximise the value of the BBC’s intellectual
property, providing income to fund high quality, distinctive
content for the licence fee payer, while supporting the UK’s
television industry on the world stage.

66

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S T R AT E G I C R E P O R T

THE COMMERCIAL
CRITERIA:
The BBC’s commercial subsidiaries
deliver quality creative content foraudiences and increase the value of
BBC intellectual property (IP), as wellas providing critical support for thewider creative industry, both in the UK
and around the world. They do thiswhilst promoting and protecting the
BBC brand and reputation worldwide,
according to the commercial criteria as
set out in the Charter and Agreement:

Commercial Activities

1.

the activities must fit with theMission and the Public Purposes;

The BBC has three wholly-owned commercial subsidiaries which complement
the BBC’s public service remit:2.

the activities must exhibitcommercial efficiency;

3.

the activities must not jeopardise
the good reputation of the BBC or
the value of the BBC brand; and4.

the activities must not, as a result of
the relationship of the activity with
the UK Public Services, trading
activities or non-service activities,
distort the market or create an unfair
competitive advantage.

BBC Studios – the BBC’s production and distribution
business. It was created in April 2018 by the mergerof the BBC’s production arm and BBC Worldwide.
The merged business now creates, invests, develops,
produces, commercialises and distributes content whichsits at the heart of the BBC schedule, as well as acrossmultiple platforms and around the world, delivering
better value back to the licence fee payer throughsupport for programme funding and cash dividends.
For more on BBC Studios activities see page 68.
BBC Global News operates the BBC’s international 24hour TV channel BBC World News and bbc.com, bothof which are funded by advertising and sponsorship,
as well as income from pay TV operators carrying
the channel. Read more in Delivering the Public
Purposes – Purpose five on page 48 and on page 73.
BBC Studioworks provides TV studio facilities,
equipment, crew and post-production services fromlocations in the south east of the UK. See more onwhat Studioworks delivers for the BBC on page 74.

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The BBC’s commercial subsidiaries
are overseen by the Commercial
Holdings Board, which is tasked
with setting strategy in line withoverall BBC Group company goals,
agreeing business plans and ensuring
compliance in regulatory and legal
matters. See pages 75 and 133.

A tiger cub from natural history series Dynasties

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C O M M E R C I A L O P E R AT I O N S

BBC Studios
BBC Studios was created in April 2018 by
the merger of two existing commercial
BBC subsidiaries: the BBC’s productionarm for factual, factual entertainment,
events, entertainment, music and scripted
programmes, also known as BBC Studios,and BBC Worldwide, which oversaw the
global distribution and exploitation of
BBC IP through content sales, channels,
international production and ancillaries.
Its goal is to inspire global audienceswith world-class content that informs,
educates and entertains, strengthening
the BBC, its partners and the wider
industry creatively and financially.
Through its award-winning production arm,
BBC Studios is the BBC’s primary supplierof content, making around 2,000 hours ofhigh-quality programming every year in the
UK. Its titles include award-winning series
like Blue Planet II, Doctor Who, Strictly Come
Dancing, This Country and Top Gear, as
well as long-running series like Watchdog,
EastEnders, DIY SOS and Antiques
Roadshow. Its programmes span drama,
comedy, factual, factual entertainment,
entertainment, music and events
representing all audiences around the UK.
Globally, through its distribution business,
BBC Studios trades in over 200 territories.
The business licenses content to broadcast
customers, runs BBC-branded channels,
on-demand services and operates
production bases catering to local,
national and international markets.
There are 34 BBC-branded wholly owned
and operated channels, broadcast in
multiple countries, ranging from BBC Earthin Natural History and Factual throughto CBeebies for younger audiences.
BBC Studios also owns channels withother broadcasting partners, like BBC
AMERICA with AMC Networks, BBC
Earth with Sony in India; and CorusEntertainment for BBC Canada. In North
America, with partner ITV plc, BBC Studios
has created BritBox for fans of Britishshows in the USA and Canada. BBC Player,
BBC Studios’ multi-genre subscription
video-on-demand (SVOD) service, isavailable in Singapore and Malaysia.
BBC Studios works with other content
companies and broadcasters to create
formats, to co-fund programmes – like theforthcoming One Planet, Seven Worlds for
BBC One, made by BBC Studios Natural
History Unit, and co-produced with BBC
AMERICA, Tencent Penguin Pictures, ZDF
and France Télévisions. This additional
international funding enables UK audiences
to enjoy premium programming in a
way that is affordable to BBC Content,
and significantly broadens the reach of68

BBC programmes, with over a billion
people watching a BBC Planet title in thelast three years. It also devises spin-off
products like programme merchandise andbranded live events like Countryfile Live.
In addition to programmes made andmarketed by BBC Studios itself, thecompany also partners with otherbroadcasters and platforms to nurtureideas and get content funded, made andshown. BBC Studios invests in independent
production companies, both for rights andstrategic equity, fostering British talentand ideas like the recent drama Pure,made for E4 by independent production
company Drama Republic, and thecritically-acclaimed adaptation of theclassic Victor Hugo novel Les Misérables –a BBC Studios Productions co-production
with fully owned premium scripted
production company Lookout Point.

Business highlights

Last but not least, BBC Studios has abold ambition to create and foster astrong working culture, one that nurtures
creativity, encourages collaboration andembraces diversity and innovation. It iscommitted to ongoing improvements
in training, development and overall
structure to ensure that all BBC Studios
staff have the support and space
they need to do their best work.

No 1
BBC Studios came top of
Broadcast’s list of distributors
by turnover

1. Headline sales
Breakdown by line of business:£m

Production andDistribution
BrandedServices
Eliminations
Total

2018/192017/18

1,056

1,104

336
(19)

326
(19)

1,373

1,411

2. EBITDA
Breakdown by line of business:£m

Production andDistribution
BrandedServices
Eliminations
Total

2018/192017/18

81

34

71
7

61
10

159

105

3. Free cash generation: £111 million(2017/18: £92 million) + 21%

500,000
BritBox Subscribers in US
and Canada

2,000
hours of television and radio
content produced for the UK

4. Returns to the BBC: £243 million(2017/18: £210 million) + 16%
5. Five-year returns to the BBC:
£1,112 million since 2014/15
2018/192017/18
2016/172015/16
2014/15First four years relate to BBC Worldwide only

6. Returns to indies: £176 million(2017/18: £149 million)

BBC Group Annual Report and Accounts 2018/19

£243m
£210m
£211m
£222m
£226m

15
new third party commissions won

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S T R AT E G I C R E P O R T

What we doCreateDeliver returns

Commercialise

CREATECOMMERCIALISE

DELIVER RETURNS—— Producing original content for the
BBC and other partners in the UK
and around the world—— Securing international
programme co-production deals

BBC:—— Programme investment—— Acquiring and selling secondary
rights to programmes—— Cash dividends—— Investing in ideas and new formats
for production and/or sale—— Investing in independent
production companies via equity
or development funding—— BBC-branded services—— Ancillaries and IP exploitation—— Rights payments—— Growing the BBC brand—— Building the profile of BBC
programmes—— Nurturing talent on and off
screen; supporting new writers

Rightsholders:—— Royalties—— Bringing creative projects tofruition through support frominvestment and development
expertise

Creative industry:—— Developing talent

Return to contents—— Specialist skills training
for production

BBC Group Annual Report and Accounts 2018/19

69

C O M M E R C I A L O P E R AT I O N S

BBC Studios Business Review
Overview
It has been a strong first year for the new
BBC Studios. The merger of BBC Worldwide
and BBC Studios was completed, creatinga cohesive and agile company. It is now
a global business of scale, able to fund,create, distribute and commercialisepremium content for both the BBC andother companies around the world.
BBC Studios can take an idea seamlessly
from thought to screen, putting thebusiness on a sound strategic footing
in a dynamic market. Alongside othercontinuing plans to transform the business,and significant deals with Discovery
struck at year end, agreeing the split of
UKTV’s channel assets and a long-term
premium factual content partnership, thisfundamental change was underpinned
by a good financial performance.
Headline sales were £1,373 million(2017/18: £1,411 million) and EBITDA was£159 million (2017/18: £105 million). For
the fifth year running, returns to the BBC,which included dividends and investments
in programming, were above £200 million
at £243 million (2017/18: £210 million).
These results show success in BBC Studios’core ambition: to create and deliver thehighest quality British story-telling,with extraordinary range and depth.
Moving forward, the business is firmly
focused on growing its contributions
to the BBC, its audiences and thewider industry, both creatively andfinancially, as it transforms its approach
to better serve consumers around theworld, consolidating its culture andpromoting creativity across the board.
Strategic approach
BBC Studios is focused on three strategic
priorities: to boost BBC-owned content andIP through world-class content creationand investment in production, indies
and talent; to grow existing franchisebrands and to build new ones; and togrow its share of high-value customers
and markets through active developmentof existing and potential relationships.
An outline of the developments in eacharea throughout the year is below.
Content
The business continues to perform
extremely well in premium content,
and is working actively to develop its
programming pipeline. For the BBC in
the year, BBC Studios made acclaimed
drama like Luther, Silent Witness, andMotherFatherSon; world-class natural
history including Dynasties and Earth’s
Great Rivers; and impactful science
programmes like Horizon: Stopping

70

Male Suicide, The Truth About… The
Menopause and Trust Me, I’m A Doctor.
Elsewhere, Hold the Sunset, Two Doors
Down and Famalam sat alongside
thought-provoking factual titles like
Winterwatch, The Flu That Killed 50 Million,
David Bowie: Finding Fame and American
History’s Biggest Fibs. The live events
team covered The Royal Wedding: Prince
Harry and Meghan Markle and the RoyalBritish Legion Festival of Remembrance.
Fatberg Autopsy was broadcast on
Channel 4, BBC Studios’ first title for a
non-BBC broadcaster, swiftly followed by
Royal Wedding Watch for PBS, Stargazing
Live 2 for ABC TV in Australia, The
Bermuda Triangle Enigma for Channel
5 and Sex, Knives and Liposuction for
UKTV’s W channel. In addition, Chocolate
Dreams – Inside Hotel Chocolat was
broadcast on Channel 5 in January.
In the year, five titles were put out totender by BBC Commissioning as partof the BBC’s progress to meeting thecontestability obligations established in
the 2016 Charter and Agreement for all
BBC returning series made by BBC Studios.
BBC Studios retained one (Later with
Jools Holland…) during 2018/19 and two
more after year-end (Topical Arts andCountryfile), losing the other two tenders(BBC Proms and Mastermind). To date,
this puts the number of titles retained
after tendering at seven out of ten.
New commissions won in the year included
Planet Earth III and Frozen Planet II for
the BBC, Inside the Duchy for ITV, The
Watch for BBC AMERICA, Danny Dyer
on Pinter for Sky Arts and Stay Free: The
Story of the Clash for Spotify. BBC Studios’
adaptation of Terry Pratchett and Neil
Gaiman’s story of an angel and demon,
Good Omens, with an ensemble cast led
by Michael Sheen and David Tennant,finished production in the year, ahead ofits première on Amazon at the end of May,
with a subsequent appearance on BBC Two.
The outstanding creativity and craft of
the BBC Studios production team wasrecognised by 79 award wins, and close
to 300 nominations in the year. These
include Royal Television Society awards
for one-off drama Killed by my Debt, live
coverage of The Royal Wedding: Prince
Harry and Meghan Markle, comedy
Inside No. 9 and Strictly Come Dancing
won a National Television Award.
Supporting British creativity beyond
the BBC remains one of BBC Studios’commitments, and BBC Studios isnurturing its relationships with bestof-British indies in ways to suit them:

BBC Group Annual Report and Accounts 2018/19

with equity stakes in 16; first look/output
deals with a further 17; and representing
content from over 200. Award-winningtransatlantic hit Killing Eve was made by
Sid Gentle (part-owned by BBC Studios)for BBC AMERICA, as commissioning
broadcaster. It was shown in the UK on
BBC One and a second series aired in
America and the UK shortly after year end.
BrandsThe business continues to invest in its
international brands. Jodie Whittaker
was a hit as the first female Doctor Who,made by BBC Studios in Cardiff. In thePlanet strand of landmark programming,
the world-renowned BBC Studios Natural
History Unit has a pipeline of titles in
production. The new presenter line-up forseries 27 of Top Gear debuted in June, andStrictly Come Dancing brought the family
together on the Saturday night sofa, with
an audience for the final of 12.9 million(55% share). The first Dancing with theStars brand extension in the US launchedwith Dancing with the Stars: Juniors.
BBC Studios is also working on
development of new brands. In Australia,
up-and-coming Children’s title Bluey,
based on the life of a Blue Heeler dog
family in Queensland, co-commissioned
with ABC Kids and set to air on CBeebies
Australia next year, has been a huge
success with critics and audiences alike.
Markets
The business has continued to evolve
its approach to important customers
and markets, including the building ofdeeper strategic partnerships to secureand grow revenue. In the US and Canada,
subscribers to BritBox, the SVOD joint
venture majority controlled by ITV and
BBC Studios, reached the half million
mark at under two years. A three-year
deal with Chinese internet company
Tencent will expand an existing content
licensing and co-production partnership,and build a social media community
around natural history programming.
In the UK, the BBC Group is working tocreate a commercial video-on-demand
partnership with ITV and others,
under the BritBox brand, to which
BBC Studios will supply content.
At the end of the financial year, BBC Studios
reached three significant deals with
Discovery. First, an agreement on the
future of the 50/50 joint venture for
UKTV’s channels business in the UK.
This will see the division of channel assets
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S T R AT E G I C R E P O R T

commercial business of both organisations.
BBC Studios will acquire the seven channels
most closely aligned to the BBC’s content
strategy – Alibi, Dave, Drama, Eden, Gold,
Yesterday and W – along with digital player
UKTV Play, and the UKTV brand. Alongside
this, it will make balancing payments of£173 million to Discovery, over two years.
BBC programmes currently deliver half
the viewing for these seven channels.
BBC Studios will look to grow investment
into UK programming, including originalcontent, for the UKTV channels it will
own, and in turn the transaction willsecure an important element of the
BBC Studios business for the long term.
It will also simplify the way BBC Studios
can offer its rights to market in the UK.
Separately, the two companies have agreed
a multi-year global content partnership in
two parts. This will see BBC Studios provide
premium factual series, including natural
history landmarks, for Discovery’s new
global streaming service, and a bespoke
development deal for BBC Studios to create
ideas for future Discovery commissions.
Taken together, these deals cement
an important partnership that will
deliver long-term returns for licencefee payers, underpinning investment inoriginal content for UK audiences, aswell as a boost for those enjoying theBBC’s programming internationally.
Operational review
2018/19 is the first year of operation forthe merged business. The performance
represented a strong start across
BBC Studios’ two key operating segments,
with earnings before interest, tax,
depreciation and amortisation (EBITDA)of £159 million (2017/18: £105 million), up
51%. EBITDA, excluding the year-on-year
benefit of foreign exchange, was up 21%.
This very strong EBITDA performance andcash generation has allowed the business to
reduce its borrowings (net debt at year endof £46 million) (2017/18: £127 million) whilst
still achieving a record year of investment
and returns to the BBC. This strong balance
sheet position will allow BBC Studios tofinance the purchase of UKTV and tofurther invest in producing world-classcontent. BBC Studios’ agreed borrowing
facility was increased to £300 million(2017/18: £270 million) on 31 March 2019.

Performance by operating segment
The business segments this year havebeen changed to reflect the way the
BBC Studios Executive Committee (SEC)
manages and tracks its performance
following the merger in April 2018.
The segmental analysis below includes
allocation of all central costs – strong
cost control in these areas, alongwith the points below, enabled thebusiness to show EBITDA growth.
Production and Distribution
The Production and Distribution
business includes the production anddistribution of scripted and unscripted
programmes to broadcasters andplatform owners, including BBC Studios’share of the results of joint venture andassociate production companies, format
sales, and other content and brandassociated licensing and merchandise.
Production and Distribution achieved
growth in EBITDA of 138%. The UK
production business performed wellin its second full year of operation as acommercial entity, with both sales and
EBITDA ahead of the prior year (9% and288%). Genres performing well include
scripted, factual entertainment and events.
The international production businessdelivered a small growth in sales andinvested additional operating expenditure
in a new production arm in Australia. Thiswas set up in September, and already has
its first commission for 85 episodes ofMastermind for SBS. In the US the autumn
of 2018 saw the premiere of the first
Dancing with the Stars brand extension in
Dancing with the Stars: Juniors for ABC.
The first female Doctor was welcomed withmuch anticipation at San Diego ComicCon and at year end, a content deal was
struck with MotorTrend to stream the
majority of the Top Gear UK catalogue in
addition to a new US version for its service.
Independent production companies inwhich BBC Studios holds stakes continued
to grow, and the shareholding in premium
scripted indie Lookout Point was increased
from 49.9% to 100% in July 2018. New
investments in the year included drama
start-ups Moonage and Firebird, both fromproven British creative talent. BBC Studios

returned £176 million (2017/18:£149 million) to indies through rights
investment and royalties within the year.
In Content Sales the business broadened
and deepened strategic relationships
with key customers, entering into a wider
set of partnerships and securing longterm commitments, as demonstrated by
the content partnership with Discovery.
Creative deal-making came to the fore
as the value of the distribution business
continued to evolve from pure licensing
to funding creativity, as shown in deals fortitles such as His Dark Materials, Draculaand Good Omens. It also saw notablesuccess in scripted format sales in Asia with
Doctor Foster to South Korea, Mistresses toJapan and Life on Mars to China, taking thetotal of scripted format sales in this region
to 15 in recent years. Elsewhere, Infidèle,
the first scripted format deal in France ofDoctor Foster, was a ratings success for TF1.
The Consumer Products business saw
significant further structural decline in thephysical media market. As a result of thismarket decline, goodwill relating to the2Entertain business was part-impaired withthis being offset by a profit generated by
the sale of the Good Food business, a highperforming but non-core area, in August.
Branded Services
The Branded Services business includes
the activities of the BBC-branded channels
and digital consumer propositions,
including the share of results from joint
venture and associate operations in BBC
AMERICA, BritBox, and UKTV, BBC Earthwith Sony and those of digital branded
services including BBC Player in Asia.
Branded Services’ performance in theyear showed growth in EBITDA of 16%.
The performance of BritBox in the US
and Canada, which is 40.5% owned by
BBC Studios and accounted for as a
joint venture, was particularly healthy.
UKTV performance remained robust.

Performance by operating segment
Statutory sales

EBITDA

£m

18/19

17/18

18/19

17/18

Production & Distribution
Branded Services
Eliminations

1,047
161
(19)

1,095
159
(18)

81
71
7

34
61
10

Total

1,189

1,236

159

105

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BBC Group Annual Report and Accounts 2018/19

71

C O M M E R C I A L O P E R AT I O N S

Commissioner of stand-out international
hit series Killing Eve, BBC AMERICA
continued to deliver strong ratings
growth, with its second most watched
year ever across all key day parts.
In under two years, BritBox achieved
half a million subscribers across the US
and Canada, ahead of all targets. BBC
Learning, globally managed out of theAmericas, secured significant deals witheducation companies ProQuest, FMG andStemscopes, as well as a multi-million
dollar deal that brings together the BBC
World Service, Microsoft Education andAngelina Jolie’s production company
to deliver a three-year programme,teaching media literacy skills to
middle school classrooms globally.
This year also saw the renewal of affiliate
partnerships for BBC-branded channels
carriage with NC+ in Poland and the launchof BBC Earth channels in the Middle
East, Turkey, Czech Republic, Slovakia
and Cyprus, as well as CBeebies in Turkey
and the Maldives. BBC First launchedin Poland as a rebrand from BBC HD. In
Australia and New Zealand, new channel
launches included BBC Living on Fetch in
May and BBC Earth on SKY in October.
Taxation
Before the impact of production tax credits,
the effective tax rate for the year was 21%(2017/18: 9%).

The markets in which BBC Studios operates
continue to change rapidly, with audiences
across the board now exercising control
over their consumption of media: what,
where and when. The need for business
transformation is still significant anddelivering expected margins in a worldof hyper-competition is challenging.
BBC Studios’ goal is to be the best British
content company in the world. It looks toinspire audiences around the world withbold British creativity. To do this it willsecure talent, rights and ideas for the
future, and through these, it will return
cash and funding for content to the BBC.
There is a growing global demand forpremium content, from which BBC Studios
is well positioned to benefit. A key
focus on customer insight and accountmanagement, including strategic
partnerships, will ensure that the business
continues to respond to this demand.
BBC Studios’ strength in production isa key selling point internationally, andpost-year end it has secured a numberof new commissions with both domestic
broadcasters and international companies.
BBC Studios’ brand and digital storytelling
expertise will continue to drive engagement
as well as develop new commercial
models for emerging digital entrants.

In addition, the business plans to invest
further in premium content, with theimpact of these plans already showing
in the increased returns to the BBC
in the financial year. This will result in
lower free cash generation in 2019/20.
BBC Studios will continue to work
hard to build and grow its brands
internationally, searching for ways toboost the value of existing franchises
and identifying opportunities for new
brands. The business is actively seeking
like-minded companies to partnerwith at every point in the process,from finding a new idea to making andexploiting content, through to developing
new business models for funding.
Achieving growth and consolidating
relationships across content, customers
and brands will enable the business toincrease its contribution to the BBCGroup both creatively and financially, inan environment where IP generation andownership are both critical. BBC Studios
has ambitious plans to build a worldclass culture that attracts and retains
the finest talent, and with content at its
heart, and an unparalleled position inhigh quality British IP, the business is wellplaced to meet stretching expectations
for the coming year and beyond.

Forward view
The merger of BBC Studios’ production
and distribution businesses is complete,giving it a strong position in the global
market, and the business is well on track
to meet its stated target of delivering£1.2 billion of returns to the BBC in thefirst five years of the current Charter
period. The business environment remains
changeable, with continuing levels of
uncertainty in the major global economies.

BBC Studios titles include the award-winning series This Country for BBC Three72

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

BBC Global News

465m
Households with access to
BBC World News(2017/18: 458m)£114m
Total income 2018/19(2017/18: £109m)

93m

BBC World News’ Impact with Yalda Hakim

bbc.com monthly unique browsers

BBC Global News is the BBC’s commercial
news subsidiary and operates the BBC’s
English-language television and online
services outside the UK: BBC WorldNews and bbc.com. BBC Global News’mission is to bring the BBC’s trusted
and impartial journalism to a growing
global audience whilst operating asa sustainably profitable business.
2018/19 saw encouraging growth insales across our Advertising Sales andDistribution businesses, with total income
up 5% year-on-year at £114 million.
The income growth contributed to BBC
Global News recording a record EBITDA(earnings before interest, tax, depreciation
and amortisation) of £8 million. The
strong performance is attributable to thesuccessful transfer of BBC Advertising(from BBC Worldwide) in 2017/18 to createa fully integrated business, and investment
in business development opportunities
such as BBC Reel and BBC Music (inNorth America), new content propositions
which drive both audiences and sales.
In 2018/19, BBC World News’ global
footprint continued to expand, growing
by 2% over the year. The channel is
now available to a record 465 million
households (up from 458 million in
2017/18). The growth was driven by
gains in the Americas and South Asia.
bbc.com increased its digital reach from88 million in 2017/18 to 93 million monthly
browsers in 2018/19, up (+6%) year-on-year.

Return to contentsMonthly page views dropped slightly,
from 1.3 billion to 1.2 billion (-5%) yearon-year, reflecting the ongoing shift
from desktop to mobile consumption.
Off-platform global partnerships forma growing part of the commercial anddistribution strategy. 2018/19 saw asignificant increase in off-platform
consumption, with bbc.com content now
reaching over 22 million users per monthon platforms such as Apple News, MSN
and Facebook Instant Articles. BBC Global
News entered into a new agreement with
Facebook to deliver a weekly show, Cut
Through The Noise, on their Watch platform,
and launched a new live news streaming
service on Yahoo! Japan. The BBC News
YouTube channel saw significant growthin 2018/19, passing 4 million subscribers
and over 1 billion lifetime video views
since the channel was launched in 2013.
BBC Global News was recognised forthe excellence of its journalism with anumber of awards in 2018/19, including
a Peabody Award and a Gracie award
for BBC World News’ reporting on thehumanitarian crisis in Yemen and a David
Bloom award for Quentin Somerville’s
Syria coverage. Online, BBC Travel won
a Lowell Thomas award for best travel
journalism website, BBC Future won a
Webby for Best Writing (Editorial) and BBC
Culture received a silver Telly Award for its
inventive video imagining how Jane Austen
characters might have used dating apps.

£8m
Record EBITDA in 2018/19(2017/18: £2m)

Forward view
The markets in which BBC Global News
operates remain challenging. On theDistribution side of the business pay-TV
operators in Europe and North America
in particular are under pressure fromover-the-top (OTT) competitors and thiscommercial pressure is being felt in turnby channel distributors. International
advertising markets, meanwhile, remain
volatile, with digital growth dominatedby technology giants. However, the BBC’s
reputation for independent, trustworthy
coverage of international events has
never been more valued and BBC Global
News has ambitious plans to build on thestrong performance of 2018/19 and takeadvantage of emerging opportunities.
The business plans to refresh its editorial
propositions in the year ahead to drive
both audience and revenue growth
while progressing ideas to diversify
beyond its core revenue streams.

BBC Group Annual Report and Accounts 2018/19

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C O M M E R C I A L O P E R AT I O N S

BBC Studioworks
BBC Studioworks is a wholly-owned
commercial subsidiary of the BBC,providing studios and post-production
services to both the BBC and externalclients. 2018/19 was momentous for thecompany as it completed its first full year of
trading at the newly refurbished Television
Centre (TVC) in White City, a facility which
complements its two sites in Elstree. The
company delivered a robust financial
performance for the year, generating£37 million of income (2018: £31 million)
and EBITDA of £6 million (2018: £3 million).
The 19% increase in year-on-year sales was
driven by the introduction of TVC into BBC
Studioworks’ portfolio, whilst high levelsof studio utilisation ensured the year-onyear rise in EBITDA. The sustained strong
performance of the company means thatit has declared a cash dividend to the BBCGroup, for the first time, of £0.8 million.

During the year, BBC Studioworks worked
with over 25 different broadcasters andproduction companies facilitating a
multitude of productions. These included:—

Strictly Come Dancing, Pointless,
EastEnders and the Appeal Nights forChildren in Need and Comic Relief for
the BBC.

—The Voice, Celebrity Juice and The Chasefor ITV.

—A League of Their Own and The Russell
Howard Hour for Sky.

BBC Studioworks also welcomed over 40
new titles, including:—

The Graham Norton Show, Have I Got
News for You and Mock the Week for
the BBC.

—Good Morning Britain, Lorraine, This
Morning, Loose Women, Peston andLove Island: Aftersun for ITV.

—The Big Narstie Show, The Great British
Bake Off: An Extra Slice and Sunday
Brunch for Channel 4.

—Celebrity Game Night for Channel 5.

—

Blockbusters and Your Face or Mine?
for Comedy Central.

—

The post-production team also
experienced a positive year as moreclients took advantage of integrated
studio and editing offerings. In addition
to EastEnders and Holby City for theBBC, the team delivered numerous
projects including The Last Leg for
Channel 4, Strictly Come Dancing –The Live Tour and The Jonathan Ross
Show for ITV.

Forward view
The market outlook for studio-based
productions and post production work
remains buoyant albeit competitive. A
steady stream of new and repeat businessprovides a favourable backdrop as theCompany looks to optimise its expanded
portfolio over the forthcoming year andpursue further growth opportunities.

The Graham Norton Show

While BBC Studioworks’ performance isrobust, the market in which it operates is
set to see numerous new facilities houses
opening over the medium term which
could impact business levels. The Company
will continue to rigorously manage its
pipeline of work and focus on businessdevelopment in order to protect its future
revenue streams. This is of importancegiven much of the Company’s revenue iswon competitively on the spot market.

£37m

74

19%

BBC Studioworks income in 2018/19(2017/18: £31m)

Increase in year-on-year sales

£6m

£0.8m

EBITDA(2017/18: £3m)

Dividend to the BBC Group(2017/18: £nil)

BBC Group Annual Report and Accounts 2018/19

BBC Studioworks also has several material
long-term contracts which are subject toperiodic retender, which therefore presents
a level of business risk. Attracting andretaining clients, winning tenders and smart
investment activity across all three of its
sites will enable the Company to maintainits non-financial and financial contribution
to BBC Group and provide security ofsupply in a dynamic studios market.
As the home to some of the nation’s mostwatched and loved television shows, frommajor entertainment productions tocontinuing dramas, BBC Studioworks willcontinue to focus on providing leading
television production facilities thatoffer a first-class customer experience.
The Company is well placed to meet its
targets for the coming year and beyond.

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S T R AT E G I C R E P O R T

Governance of BBC’s Commercial Holdings
Commercial Holdings is the body thatoversees the operations of all the BBC
Commercial Subsidiaries. The below setsout how the Commercial Holdings Groupis governed and the role of theCommercial Holdings Board.
Reviews
During the year, there were two reviewsof the BBC commercial subsidiaries.
The BBC Board published a review
into the operation of its wholly-owned
commercial subsidiaries: BBC Studios;
BBC Global News; and BBC Studioworks.
The review, undertaken by EY andpublished in December 2018, found thatthe commercial subsidiaries exhibited
commercial efficiency consistent with
their peer groups and the wider market;
that they fit with the BBC’s mission andpublic purposes, did not jeopardise thecorporation’s reputation; and have policies
and processes in place to ensure that they
do not distort the market. Separately
Christopher Saul, an independent
advisor on corporate governance bestpractice, was commissioned to review
the commercial transparency of the BBC
alongside a review of transparency in the
public service conducted by Will Hutton.
In his review, Christopher Saul found thatthe BBC’s commercial operations areat least as transparent as comparable
organisations and, in certain instances,more so. He also made recommendations
on how transparency might be increased.
One of the Saul recommendations was inrelation to the Board of BBC Commercial
Holdings Limited – which provides
governance, assurance and oversight ofthe commercial subsidiaries and theiractivities, on behalf of the BBC Board andthe BBC group. Mr Saul recommended
that there should be fewer executives
on the Commercial Holdings Board andan increase in non-executives. Following
this, from 1 April 2019 the compositionof the BBC Commercial Holdings Board
was amended and it is now chairedby a non-executive director from the
BBC Board, Elan Closs Stephens. The
full composition of the Board, which
includes four non-executives and six
BBC executives, is set out on page 133.

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Management
The day-to-day management of BBC
Studios, BBC Global News and BBC
Studioworks is the responsibility of theirrespective chief executive officer: Tim
Davie; Jim Egan; and David Conway. The
chief executives are supported and advisedin the management of their commercial
subsidiary by an executive committee
comprising the senior management of
the business. The executive committees
have been granted appropriate delegatedauthority in the running of their business,
as approved by BBC Commercial Holdings.
The chief executives attend each meeting of
the Commercial Holdings Board to present
a report on the performance of theirbusiness, which provides the directors with
an opportunity for constructive challenge.
The future
The BBC Commercial Holdings Board
meets at least six times a year. In theyear under review there were eight board
meetings. The full terms of reference
can be found at bbc.com/aboutthebbc/
whoweare/commercial. A new nonexecutive director is being recruited tofill the vacancy left by the resignation ofHoward Stringer. The new non-executive
director is expected to be in place byearly summer 2019. Elan Closs Stephensprovides her report as Chair of Commercial
Holdings, on the activities of the company
and its subsidiaries, on page 133.
In the coming year, the directors will
support the value for money review being
undertaken by the NAO on the creationof the enlarged BBC Studios; as well as
keeping under review the Commercial
Holdings Board’s working practices toensure that it remains effective andefficient. In keeping with the other majorcommercial subsidiaries, the Commercial
Holdings Board and its Chair are supportedby the commercial company secretariat.

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Our people

Our people are the bedrock of what makes the BBC special.
They come from diverse backgrounds, reflecting our different
audiences and are fundamental to the continued delivery ofoutstanding programmes and services. This year, one of ourmost significant priorities has been to continue with our aim
to make the BBC the best place to work, conducting a set ofwide-ranging culture and career progression reviews, consulting
extensively with people across the whole of the BBC.

76

p.77

p.80

p.82

p.84-86

An inclusive culture

A culture of diversityand development

Human Rights and Modern
Slavery Statement

Supporting data tables

p.77-80

p.81

p.82

Addressing seven priority
review outcomes

Supporting anddeveloping new talent

A clear organisational
designBBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

Our people – culture, pay and trust at the BBC
Without great people, the BBC is nothing.
Our outstanding programmes, services,
radio, podcasts and journalism are only
possible because of the dedication, skill
and knowledge of the people who workwith us – whether for a few weeks as afreelancer or for many years. They are thebedrock of what makes the BBC special.
They come from diverse backgrounds,
they push the organisation to be the best
it can be and, above all, they care about
the BBC and what it stands for.
Throughout the year we have continued tofocus on making the BBC the best place
to work – and we have also addressed awide range of challenges. We have been
scrutinised heavily, internally and externally,
and this has tested us to ensure we arebeing the organisation we want to be.
We have made real progress this year in
bedding in some fundamental changes
to the way we do things. This includes
the finalisation of updated terms
and conditions for all staff and theimplementation of a new, industry-leading
career path framework, giving structure
and clarity to all our employees about theirroles in the BBC. These steps will inevitably
take time to be fully embedded and applied,but the results of a number of independent
reviews have shown that we are making
real progress in moving beyond the issues
seen over the past years. This includes
this year’s two transparency reviews, led
by Will Hutton and Christopher Saul, andthe NAO’s recent value for money review
of pay at the BBC. We were delighted
that the NAO’s report acknowledged thesignificant steps the BBC has taken to
improve the consistency, transparency andfairness of staff pay and working practices.
So, this report sets out for everyone, ourpeople and those outside the BBC, what wehave been doing to make the organisation
more efficient and effective, developing
our culture so the BBC continues to be atrusted and positive place to work. We wanteveryone to understand what the principles
and aims are that drive our culture, ourpay and our policies, and we want all our
people to understand how they can develop
their career in the BBC. Below we set out
a summary of what we have achieved in
the past year, focusing on creating an
inclusive BBC where staff can develop,
progress and have trust in their reward.

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The BBC’s five reviews ofdiversity and inclusion in
our workforce:
—

BAME

—

Disability—

Gender—

LGBTQ+—

Socio-economic diversity
You can read all the reports here:
bbc.co.uk/diversity/strategy

An inclusive culture – our five reviews
One of our most significant priorities
this year has been to continue with ouraim to make the BBC the best place towork. Nowhere is this better seen thanin our decision to conduct a set of wideranging culture and career progression
reviews, consulting extensively withpeople across the whole of the BBC,and bringing together views andrecommendations on what more we could
do to strengthen our culture of inclusion.
Five separate reviews were published,each review focused on a different
area of diversity and inclusion. A
member of the Executive Committee
or senior leader sponsored eachreview and 128 recommendations
were developed. These are being
implemented across the organisation
with great progress being made – 95%
are now completed or underway.
From looking across all the reviews
and discussing them extensively with
employees, we have identified sevencommon areas of importance that are
relevant for all our people, irrespective of
their race, gender, sexuality, disability or
background. A summary of these follows,
along with some highlights of what we haveachieved in each area this year. Progress inall these areas is being measured throughour employee engagement survey.
1. Goals, objectives and values
One of the key things we heard across allof the reviews, and echoed in our employee
engagement survey, is that the mission of
the BBC is really important to us all, andall our people want to be aligned behinda clear vision for the organisation. Our
mission is to inform, educate and entertain,
and, as this Annual Report makes clear, ourstrategic goal is to reinvent the BBC fora new generation and be a positive force
across UK society and for our creative
economy. In January, we pressed pause
across the whole organisation for a few

hours to share our strategic goals in teamdiscussions. We had these conversations
again in the spring when we communicatedour Annual Plan, and continue to keeppeople informed and engaged throughout
the year. We also updated the ‘BBC Codeof Conduct – How we work together’. This
brings together in one place our key policies
and expectations, including our BBC Values,
and for the first time new Leadership
Commitments, Employee Commitments
and a Diversity and Inclusion Statement ofIntent. The Code also encourages people tospeak up if they know something is wrong.
Regular updates on progress are provided
to all through a wide variety of internal
communications, making sure everyone
knows the direction that we’re going inand the part they are playing. 78% of
people in our recent employee engagement
survey said they know how their work
contributed to the goals of the BBC.
2. Great leadership
The capability of our leadership community
is another area we have heard is crucial tomaking the BBC the best place to work.
Our senior leaders and team leadersneed to relish leading and developing
teams and inspire trust, confidence andenthusiasm. And they need to be diverse,
representing all the audiences we serve.
New Leadership Commitments have beendeveloped this year, with our leaders
working together to set out what excellent
leadership looks like when we’re at ourvery best. All our leaders are expected tolive by them and 80 Leadership Matterssessions have been held around the country
so that leaders can come together to shareexperiences and learn from each other.
To further support these commitments,
we’ve developed a new suite of leadershipdevelopment programmes aimed at alllevels of leadership – ‘Stepping Up to
Leadership’ for first-time leaders; a ‘Team
Leadership programme’ for establishedleaders; and, for senior leaders, a separate
programme focused on their particularneeds. All include coaching and mentoringfor participants and the opportunity
to get involved in pan-BBC activity
focused on big leadership challenges.
Supplementary to this, we have a libraryof blended learning support and a newly
developed series of online and roundtable discussions on topics such as
managing pay and flexible working.
All BBC leaders are required to have annual
personal development reviews informedby 360-degree feedback and to complete
mandatory training in unconscious bias,
fair selection, cultural and disability
awareness and bullying and harassment.

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3. Fair recruitment
Our recruitment practices must be fair andtransparent, and attract a diverse rangeof talent, giving everyone opportunities
to achieve their full potential.
Throughout the year, we have further
reviewed our approaches and madechanges to ensure that processes are as
inclusive as they can be. These include job
descriptions that are free from gender orother bias and we are working towards
ensuring that all our most senior jobs haveat least one BAME candidate shortlisted,
and mixed gender interview panels. We
have also created and trained a diverse
pool of interview champions and ensured
all those involved in recruiting haveparticipated in unconscious bias training.
4. Career progression
Our people tell us that they want aconsistent approach to career progression
across the BBC, with information they
can trust. The Career Path Framework,that has reduced our job titles from about

5,000 to 600, has been fully developed
and provides transparency of descriptions
on all job types at the BBC so everyone
can not only see how they can progresswithin their own job family, but also what
other jobs in different job families exist andwhat skills and experiences are required
to move into them. To further bring this tolife, we’ve created videos of people acrossthe BBC sharing how they have used theCareer Path Framework and short Career
Story films of our own people talking about
the jobs that they do and how they got towhere they are. This is supported by easy
access to our Careers Hub, with informationon all job vacancies, and the Hotshoes
initiative which facilitates short-term
placements around the BBC and provides
people with the chance to broaden theircareers with targeted work placements.
At the heart of promoting career
progression is the guidance andencouragement our people receivefrom their team leaders and other moreexperienced colleagues. To support

this we have increased the numberof trained mentors across the BBC
and we’ve developed an innovative
online matching tool (BBC Mentor
Connections) which enables people tosearch for a suitable mentor online.
5. Flexible working to balance work withhome and personal life
We know that our people want support
to be able to balance work and home
life, so we have enhanced our flexible
working policies to increase the range ofoptions available, whether that’s working
reduced hours, working from home, having
compressed or staggered hours or working
in a job share. We’ve also provided training
to our team leaders on flexible working.
A new job sharing register has beenlaunched and jobs are required to be
advertised with the ability to work
flexibly unless there is a valid businessreason that precludes this. Since
introducing this change, three-quartersof BBC jobs have been advertisedwith the option to work flexibly.
Individuals on maternity/parental leave now
have their IT accounts kept open for theduration of their family leave, giving themthe option of continued engagement intheir job if they wish to do so. We have also
introduced additional coaching for those
returning from maternity/parental leave.
Nursing rooms are in all major sites and wehave launched a new premature baby policy.

Hot Shoes
Shiromi Ramanayake, Service Manager in
the Service Capability and Design team,
took a Hot Shoes placement with the
Broadcast & Online Service Management
team and it fast-tracked her career.
Within five weeks of completing theplacement, she was promoted and offered
the position of a Service Manager withthe team she had a placement with.
Why did you apply to do a Hot Shoes
placement in this area?
I was at a crossroad point in my career.
I’m sure you’ve all experienced this stage –when you feel you need to take anotherdirection, gain fresh perspectives, shareyour knowledge and have the opportunity
to progress. I was at the stage where
I wanted more responsibility and todevelop my skills towards more managerial
competencies. The Hot Shoes ethos of78‘Get inspired and share your talents’really matched how I was feeling at thetime and what I wanted to achieve.
How did the placement benefit
your career?
My Hot Shoes placement with Service
Management helped me to move
speedily up the career ladder. Within five
weeks of completing my placement, I hada job offer from my Hot Shoes placement
team. I was promoted to the role of aService Manager. I am very grateful to
the Service Management team for how
well the placement was organised andthe time and dedication they put intowards my Hot Shoes experience. I wasable to learn effectively about the roleand its vital managerial competencies
and explore these when I put forwarda Service Manager job application.

BBC Group Annual Report and Accounts 2018/19

6. Wellbeing
Another consistent theme from our reviews
was that of wellbeing and support for those
who work here. We are proud to say thatour people enjoy a supportive environment
at the BBC and there is a continual focus on
wellbeing. We have increased the number ofhealth kiosks in BBC buildings and offered
night workers health education sessions
and health screening appointments.
We have also updated our advice on themenopause for managers and colleagues.
A new trauma referral pathway has beencommunicated, to enhance the support
we give to colleagues, and we continue
to strengthen our Mental Health First
Aid network with over 900 Mental HealthFirst Aiders. In the last three years, 350
mental health/wellbeing/resilience
training courses have been delivered.
Wellbeing events are regularly held
and a Wellness week in Salford wasattended by 2,700 people. Our existing
provision of wellbeing services continues
to be strengthened and includes free
employee counselling, the anti-bullying
and harassment helpline, occupational
health and travel advice, manager adviceline and disability access services.

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S T R AT E G I C R E P O R T

At the heart of promoting
career progression is theguidance and encouragement
our people receive from theirteam leaders and other moreexperienced colleagues.
7. Fair pay
The last theme we have heard aboutfrom our people is arguably the mostcritical – what we say and do on pay is,clearly, of huge importance both to ourpeople and to those who pay the licencefee. This year, we have had a significant
focus on ensuring that we move beyond
past concerns to develop a culture
and an approach to pay that is felt tobe, and seen to be, fair and open.
Our pay practices and how we reward
people are key to how we meet our coreaim: to attract and retain the best people
in order to make the very best creative
content we can, whilst recognising ourduties as a public service employer, paid
for by the licence fee. We now have inplace some really clear, simple principles
that guide all reward in the BBC – public
service and commercial – these are below,
with a summary of what they mean inpractice and what we have done thisyear to embed them across the BBC.
Fair
We want to be sure that people in
the BBC are paid fairly, and we takefairness very seriously. We do this byconducting regular reviews of pay levels
for similar roles, to ensure there is always
fairness in pay between employees.
Employees can also raise pay concerns.
All pay decisions are made within a clear
governance framework to ensure thepay bill is controlled and monitored.
We were the first broadcaster to open
up about gender and pay. The NAO hascommented that the BBC is well aheadof other organisations, but we’re still
not where we want to be. In 2019, ourmedian gender pay gap is 6.7%, downfrom 7.6% in 2018. The challenge isstructural and a function of us having alower proportion of women in senior roles– not because we don’t pay people fairly.
We also continue to publish, voluntarily,
our BAME, part-time and disability pay
gaps, and now LGBTQ+, as we believe it isimportant to be open about all aspects ofpay. For more information, please see ourfull gender pay gap report, available at:bbc.com/aboutthebbc/reports/report.

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Consistent
It is important to us that pay is consistentacross the BBC. Previously we had too
many different contracts, a complex pay
and grading structure, and outdated
policies and allowances that weren’t
applied evenly across the organisation.
We wanted to make the BBC a simpler,
fairer and more consistent place to workand ensure we operate efficiently for licencefee payers. Therefore, we proposed a review
to modernise our terms and conditions
and spent many months during 2017 and2018 working together with the BBC’s joint
unions – the NUJ, BECTU and Unite – aswell as consulting extensively with ourpeople, to help shape the proposals.
The terms and conditions review has
been the biggest change to the way weemploy people in a generation. It included
a three-year pay deal up to 2019/20,
a minimum pay level of £20,000 andensuring that everyone is paid at least at
the minimum of their job pay range. The
new pay and grading framework has been
implemented with about 600 distinct job
titles and descriptions spread across 27
different job families and seven career
band levels. These changes mean thateveryone who works at the BBC is now
able to see clearly where their role fits,
how they can progress and have trust inwhat support and pay is available to them.

Transparent
Being funded by the licence fee, it’s
only right that we operate in a fullytransparent way. This year we published
two independent reviews of transparency
in the BBC, led by Will Hutton andChristopher Saul. They found that
we are “among the UK leaders in pay
transparency” and believe, when it comesto what we disclose to our staff, we go“further than any large British public andprivate sector organisation”. But they also
asked us to do more to explain what wedo and to develop our industry-leadingtransparency further to give our people
as much internal information as possible
on how they are paid, why they are paid
what they are, and how this comparesto others in the same or similar roles.
We use, for example, transparent job pay
ranges along with graphs to show how
pay is distributed within an individual’s
job pay range. Our people can see how
their pay is positioned versus their peers
using our PeopleView system, and thisyear, we have introduced gender splits
to show any differences between maleand female pay distribution. We also
recently produced a short film, publishedon our intranet, to clearly explain how
pay works at the BBC. We will continue
to work on more measures, to ensure welead the way with pay transparency.

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Competitive
We know we operate in challenging,competitive markets, with motivated andoften mobile talent. However, we must also
be sure that what we pay demonstrates
value for money for the licence fee payer
and takes account of areas where the BBC
sets, or at least leads, the market for pay.
We undertake regular benchmarking ofour pay levels using external data sources
to make sure our pay structures enable us
to attract and retain the best people. The
job pay ranges are extensively tested andare published on our intranet. They arealso being introduced in our commercial
subsidiaries to ensure we have a ‘one BBC’approach to pay across the whole group.
Clear
We want everyone to be able tounderstand, and have trust in, why they
are paid what they are paid, to be able
to ask questions about this and to see
how they can progress their career inthe BBC. This year we have continued
to put in place the information sourcesthat will make sure this is the case.
Everyone now has a Career Path Framework
job title, broad band career level andassociated job pay range which they canview on a personalised page on our intranet.
We are clear on how pay adjustments
are made. Outside of our annual unionnegotiated pay settlement, we have clear
policies on promotions, moves to anotherjob within the same band and short-term
acting up or attachment assignments.
We also have a clear approach to where
we would expect individuals to bepositioned in their job pay range related
to individual factors (knowledge, skills,
values and experiences), role factors(scope, complexity, responsibilities andimpact) and external organisational
factors (supply and demand).
Across the BBC the largest numbers of staff
are in the journalism, technology – systems
and delivery, and content production job
families. About 800 of our staff are in
on-air roles (presenters, correspondents,
reporters and on-air editors).
These five principles support all our workon pay. Through the last year we have hada clear focus on a number of high-profileand complex projects and reviews, allof which have been designed to create awork environment that meets and deliverson the principles and themes above.

80

We’ve been through a tremendous periodof reform – and have already changed
many things for the better. We’ve worked
closely with external bodies like the
NAO and the Equality and Human Rights
Commission – to review our practices andwill continue to work collaboratively withall parties to ensure all of our reforms are
fully embedded – and make any necessarychanges to our culture and ways of working.
A culture of diversity and development
As we continue to look for new ways toensure the BBC is the best place to work,
we continue to lead the way in providing
access and development opportunities forall our staff, whatever their background.
We have also continued to meet ourRoyal Charter commitment to provide
training and support for the benefit of
the whole media industry. And, more
recently, Board member Tom Ilube hastaken on the chair of the BBC’s Diversity
and Inclusion Advisory Group, supported
by Tanni Grey-Thompson and with external
advisors Solomon Elliott, Tanya Motie,
Geoff Norcott, Adele Patrick and June
Sarpong. The group will support and advise
the Director-General and the BBC on how
it portrays all of the UK’s communities onair, and represents them in its workforce.
Our achievements against our diversity
strategy continue to be monitored. We
pledged that by 2020 we would havea workforce and leadership groupingat least as diverse, if not more so, thanany other broadcaster in the industry
and we’re pleased that our recent
employee engagement survey showedthat 72% of our people felt comfortable
to bring their whole selves to work.
Fulfilling our commitment to diversity
starts with the way we bring new people
into the BBC and continues throughout
the time our people are with us.
From being an almost exclusively graduate
entry employer just a few years ago,
the BBC is now one of the UK’s leading
employers of non-graduate apprentices,offering this year 350 apprenticeshipand traineeship opportunities for thebest young talent from the broadestof backgrounds. As well as our existing
portfolio of editorial, technology andbusiness schemes, we now offer new
apprenticeships in Data Science, HR,
Safety, User Design, and have invested
significantly in Journalism roles in Cardiff.
In early 2018, we were awarded second
place in the prestigious National Apprentice
Employer of the Year Awards and more
recently Top National Apprentice Employer
at the National Asian Apprentice Awards.

BBC Group Annual Report and Accounts 2018/19

In order to give everyone with the potential
to succeed the chance to work for the BBC,
we have launched a pre-joiner programme,
Get Into Media, developed and delivered
with support from the Sutton Trust and
MyKindaFuture. Aimed at 60 highly creative
school students from Salford and London,
this 15 month programme offers training,
work experience and a BBC mentor;
preparing individuals for application
to a range of BBC apprenticeships.
BBC School Report relaunched in
November 2018 as BBC Young Reporter,a partnership between BBC News and the
BBC Academy. Aiming to engage young
people with digital skills through outreachand mentoring, we delivered workshops
in areas including Sunderland, Bradford,
Aberdeen, Derby and Middlesbrough,reaching over 4,000 young people.
And we are among the first UK
organisations to focus on the issues
connected to social mobility being
the only broadcaster and media
organisation to make the Social Mobility
Index top 50 companies. Radio 1 and1Xtra’s initiative, Where it Begins, wasa success offering eight-week paid
placements that were designed to
attract a range of people to the BBC.
For those whose career in the BBC isunderway, the BBC Academy, our training
department, has been moving frompredominantly classroom-based delivery
to a blend of online training modules
and other digital resources, basedon individual’s roles and experiences.
As well as delivering better value formoney, this approach offers greater
flexibility and choice to our people,
enabling them to study when they want
at a pace to suit them. In 2018/19, morethan 100,000 training sessions werecompleted, 72% were online, and 90% of
our people took part in some training.
The biggest development programmein this year has been for the Open Media
project to replace the News operating
computer system. This has trained morethan 4,500 people across the UK, working
with teams such as Today, Newsnight,
Radio 2, Asian Network, 6 Music, WorldTV News and a number of regional
television and local radio stations.
Good progress has been made towards
our 2020 off-screen diversity targets
and new employee diversity networks
have been established. Networks
are now in place organised aroundgender, race, disability (including neurodisability), sexual orientation and age.

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S T R AT E G I C R E P O R T

Supporting and developing
new talent
We have continued to invest in
and develop new talent to help
embed diversity at the heart of
all our channels.
—

Born Digital – First Cuts, a UK-wide
collaboration between the BFI and
BBC Four to support new andemerging talent from a variety of
disciplines, marked 30 years since
the creation of the World Wide Webwith 11 short films.

—

Animation 2018 – a uniquecollaboration between BFI, BBC Arts
and BBC Four – commissioned 13
new young animators as part of anevening of programmes dedicated tothe art of animation on BBC Four.

——

BBC Radio 3 introduced the Next
Generation Voices, a talent scheme
designed to find and develop thenext generation of speech
contributors and presenters. BBC
Arts’ new Generation Thinkers
scheme also continued.
The Comedy Shorts gave short-form
comedy a vital new outlet to develop
the next generation of on andoff-screen comedy talent.

We have more women in leadershiproles than ever before and 31% of the
BBC Board and 38% of the Executive
Committee are women. The number ofleaders from a BAME background has
also improved from 10.4% to 11.5%. We
recognise however that we have much
more to do to increase the numbers andare offering at least half of the placeson our current leadership development
programmes to women and at least 15%
to participants from BAME backgrounds.
All staff and leadership: 31 March 2019
Workforce

31 March
2019

2020
target

Women (all staff)

47.9%

50%

Women (leadership)

43.8%

50%

Disability (all staff)

10.2%

8%

Disability (leadership)

8.7%

8%

BAME (all staff)

15.3%

15%

BAME (leadership)

11.5%

15%

LGBTQ+ (all staff)

10.8%

8%

LGBTQ+ (leadership)

11.4%

8%

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BBC Music’s commitment to newtalent initiatives remained strong,with Radio 2 Young Chorister of theYear, The Young Brass Award andthe Radio 2 Young Folk Award.

—

In November 2018, BBC Music
Introducing LIVE 18 saw more than
15,000 young people attend its
three-day event dedicated todeveloping the next generationof artists and music industry
professionals. Other new music
initiatives included The Brit List
and BBC Sound of 2018.

—

BBC Young Musician 2018, theBirmingham-based 16 year-old
pianist Lauren Zhang, performed
at Biggest Weekend and the
BBC Proms.

—

New talent development scheme
BBC Introducing Arts was launchedwith key arts partners across the UK
to support and encourage artists to
produce high-quality content acrossthe BBC’s services. It includes
partnerships with Arts Council
England on New Creatives, Creative
Scotland for Now & Next, Northern
Ireland Screen with Two Minute
Masterpiece and with Arts Councilof Wales on Slate Extra.

The Expert Women project partnered withWorld Service English and BBC Scotland
to improve gender diversity across their
output and a total of 24 women took
part in the latest training day gaining
practical radio and television skills as wellas the opportunity to network with key
editorial World Service English staff.

Creating a trans-inclusive culture in theworkplace starts with education andawareness, and this year we launched ane-learning guide for managers and staff
on supporting transgender colleagues.
We are continuing to focus on
representation on screen too. To measure
diversity across our TV content and reportprogress we use Diamond, an online tool
used by the BBC, ITV, Channel 4, Channel 5
and Sky to obtain consistent diversity dataon programmes. The initiative is supported
by Pact and Creative Skillset, and delivered
through the Creative Diversity Network.
We know the diversity of production teams
and who our audience see and hear in our
programmes is vital to how we reflectmodern Britain and our second on-screenand behind the camera (off-screen) report
represents all our suppliers of programmesfor BBC One, BBC Two, BBC Four, CBBC
and CBeebies, excluding News and Sport.
We made a clear firm commitment toimprove representation by 2020 andaim to have:—

50% women on-screen, on-air and inlead roles across all genres fromDrama to News;—

8% disabled people on-screen andon-air including some lead roles;—

8% LGBTQ+ on-screen portrayal
including some lead roles; and—15% black, Asian and ethnic minorities
on-screen, on-air and in lead roles
across all genres.

As well as our commitment to requiring all
staff to attend unconscious bias training,
this year the BBC has mandated Disability
Confident training for all staff. The course
covers key concepts of disability equality
including behaviours and responsibilities
under equality law, and illustrates bestpractices to promote a culture of disability
confidence and inclusion amongst all staff.
Last year the BBC was accredited as a
‘DWP Disability Commitment Employer’.
Like many employers, we are launchingan LGBTQ+ Allies Programme, with theaim of making the BBC more inclusive
for LGBTQ+ staff – signified by allies
wearing a rainbow pin badge and signingup to being someone who challenges
behaviours and helps contribute to
an inclusive culture in the workplace.

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Actual on and off-screen diversity: 1 April 2018 to 31 March 2019
Data provided from contributions by individuals who have a role in eligible programmes.
Actualoff-screen

Actualon-screen

Female

52.9%

54.6%

BAME

9.9%

27.3%

Disabled

5.1%

8.6%

LGBT
Transgender
Number of contributions*
*

14.3%

9.5%

0.1%

0.3%

178,22257,469An individual may make multiple contributions to a programme or programmes

Perceived on-screen diversity: 1 April 2018 to 31 March 2019
Data input by production companies taking a viewer’s perspective of what they see
and hear.

The full statement is available atbbc.com/aboutthebbc/reports/report.

Perceived
on-screen

Female

45.7%

BAME

23.4%

Disabled

5.3%

LGBT

5.2%

Transgender

0.1%

Number of contributions*372,634% for whom diversity characteristics were determined

87.7%

Data includes 38% of all network hours transmitted from 1 April 2018 to 31 March 2019. Programmes commissioned
before 15 August 2016 are not included. Data is based on internal and external suppliers. Of those who were invited tosubmit diversity data, we have a 29% response rate. Channels: BBC One, BBC Two, BBC Four, CBBC, CBeebies(Excludes: BBC Three online content, news programmes, BBC News and BBC Parliament). Reporting period covered:
1 April 2018 to 31 March 2019. Date report was generated on: 14 May 2019. Data source: Diamond/Silvermouse.
* An individual may make multiple contributions to a programme or programmes.

For more information on Diamond see: creativediversitynetwork.com/diamond/

Our Diamond data demonstrates the
progress we are making towards thesetargets and represents 38% (up from
29% in 2017/18) of all network hours
transmitted from 1 April 2018 to 31 March
2019 on BBC One, BBC Two, BBC Four,
CBBC, and CBeebies. (BBC Three online
content and News programmes are
currently excluded although work isunderway to collect data for both.)Everyone who works on a programme isinvited to submit diversity data, thoughcurrently we are only able to report on
the 29% of individuals who have sharedthis. This is an increase from the previous
26%, but increasing returns remains
a key focus with all our suppliers.
To read about our programmes and content
representing the UK’s nations, regions
and communities, go to pages 36 and
166. You can also find information on ourEquality Information report on page 258.

82

Alongside our clear commitments
to development and training for ourpeople, we also subscribe to clear,well understood principles about thetreatment of anyone who works forus, including in our supply chains.
Human rights
We are committed to respecting the humanrights of all those who work for or with us.
This applies to all employees, temporary
workers or workers in our supply chain, in
the UK and around the world. Everyone has
the right to a safe working environment;
to, at a minimum, be paid and work hours
in line with local legislation; to form tradeunions; and to be treated respectfully.
Our Terms of Trade require any suppliers
we work with, and any sub-contractors
they use, to adhere to the codes of practice
published by the Equality and Human
Rights Commission and the Equality
Commission Northern Ireland. In addition,
suppliers, and sub-contractors, are required
to abide by our Code of Ethical Policy whichsets out our expectations with respect
to human rights and trading ethically.

BBC Group Annual Report and Accounts 2018/19

Modern Slavery Statement
We recognise the need to prioritise tacklingthe most severe human rights abuses,
including modern slavery. We remain
supportive of the aims of the Modern
Slavery Act 2015 and publish our fourthModern Slavery Statement in accordancewith this. We are committed to actively
engaging in the eradication of modern
slavery, taking action within our businessand influencing our suppliers to do thesame. In our statement we set out further
steps we have taken over the last year
to help ensure modern slavery does notexist in our business or supply chain.

Anti-bribery policy
The BBC is committed to conducting
business in accordance with the highest
ethical and legal standards. The integrityof our staff, and those with whom we
do business, is critical to our success.
Our audiences also expect this.
The BBC anti-bribery policy setsout our responsibilities and provides
information and guidance on the practical
implications of the Bribery Act 2010. The
BBC’s Anti-Bribery Code of Conduct, ofwhich this policy is a part, reflects ourcommitment to uphold all laws relevant
to countering bribery and corruption in
all the jurisdictions in which we operate.
Staff undertake mandatory anti-bribery
training. Procedures are in place suchthat staff may raise concerns internally
via their line management, or externallyand anonymously via our whistleblowing
service provided by Expolink. The BBC’s
approach to bribery and corruption
is communicated to suppliers,
contractors and business partners.
A clear organisational design
All of the above shows that we arecommitted to ensuring that our people haveaccess to the best means we can provide
for them to grow, develop and progress at
the BBC. But, to be able to do this mosteffectively, it is critical that we have clear,efficient and well established organisational
structures in place that support this.
Organisation design principles continue
to be applied to monitor efficiency andkey metrics are continually tracked.
Management layers are kept as flat as
possible and 96.4% of our structures
now have seven or fewer organisational
layers. Our senior leader numbers havecontinued to reduce to 1.4% of ouremployees and overall we have one
team leader to every eight employees.

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S T R AT E G I C R E P O R T

Spend on professional services andsupporting activities is minimisedand enables 95% of our controllable
spend to be directed to audiencefacing content and services.

Total average headcount (equivalent
full time as at 31 March 2019)
UK Public Service
Broadcasting

19,231

18,210We also remain committed to locating atleast 50% of our employees outside ofLondon and some 52.2% are currently
based outside of the M25. Supporting
this, we created 70 new roles as part of adrive to develop Glasgow as our third techhub. Following on from this success weare now building additional new teams in
Glasgow for BBC Sounds and BBC Datalab.

BBC Studios*

2,714

2,963

456

258

22,401

21,431

During the year we also launched
Scotland’s new TV channel, BBC Scotland.
This was part of the biggest investment in
the BBC in Scotland for a generation andgenerated 80 new jobs in news services
in Scotland, covering a range of roles
both in front of and behind the camera.
Over the course of 2018/19 the BBC’s
average Group headcount increased by 5%
and total levels stood at 22,401, up from21,431. The major shifts in headcount were:—

416 new roles in World Service News,
both in the UK and internationally, toenhance existing language services
and support 12 new ones;—

investments in 250 new roles and skills
across the UK, many of which were indigital, and are required to support
building the BBC of the future;—

recruitment of 302 new staff within
nations – English Regions, Scotland,
Wales and Northern Ireland as a resultof additional investments announced
last year including investment in the
new BBC Scotland television channel
and in local radio;—

193 new roles due to additional
television, radio and news production
activity; and—the closure of 191 roles as a result of avariety of strategic initiatives across all
the BBC’s divisions

2019

Other commercial
businesses***
Group total

2018**

Within the averages, above 2,907 (2018: 2,855) part-time
employees have been included at their full-time
equivalent of 1,840 (2018: 1,786). In addition to theabove, the BBC employed an average full-time equivalentof 1,350 (2018: 1,187) persons on a casual contract.
*
The 2017/8 figure includes BBC Worldwide staff**
Prior year results have been adjusted to exclude
casual staff***
Other commercials included 165 Ad Sales staff
transferred from BBC Studios on 1 April 2018.
The PSB Group also included an average of 90
technology staff transferred from BBC Studios
during the year.

The majority of our payroll employees
work on continuing contracts (89%)
with an average in 2018/19 of 11% on
fixed-term contracts. Additionally weengage contingent workers to work on
short term assignments throughout
the year and on average engaged
3,268 per month in 2018/19.
Data tables
On the following pages, we provide
some more information and data to
support the reporting and detail. This
includes information we have reported
in previous years on severance paymentsin the BBC, bullying and harassment
cases, and overall trade union timespent by specified employees.

The average payroll headcount in 2018/19
increased across the Group by 970 which
was offset by a reduction in roles within
other areas of the Group. This included
an increase of 1,021 in Public Service.
Voluntary attrition continued to be
low at 4.9% across all jobs. This varied
though across different job disciplines
with, for example, News jobs having only
3.1% voluntary attrition but professional
services jobs including technology
having 7.9% voluntary attrition.

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BBC Group Annual Report and Accounts 2018/19

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F I N A N C E , P E O P L E A N D O P E R AT I O N S

UK senior leader headcount by salary band (PSB only)
2018/19
Actual2017/18
Actual£50,000 – £99,999£100,000 – £149,999£150,000 – £199,999£200,000 – £249,999£250,000 – £299,999£300,000 – £349,999£350,000+

52
100
63
25
3
5
2

76
94
70
15
4
4
1

Total*

250

264

Volumes

Variance£000s

Salary band*

Total excludes BBC Board members and pension directors

Spend on on-air roles
2018/20192017/2018

Spend
£000s

Volumes

Spend
£000s

Less than £40,000

52,81428,55950,64528,641

2,169£40,000 – £100,000

70,514

1,205

64,713

1,126

5,801

£100,000 – £150,000

13,501

110

12,488104

1,013£150,000 – £500,000

18,16275

14,66463

3,498£500,000 – £1m£1m – £5m
Total

610

1

1,687

3

(1,077)

3,001

2

3,418

2

(417)

158,602

29,952

147,615

29,93910,987The volumes and spend above represent all engagements and payments, which are not representative of an EFT basis. Included above are three organisations, for example external
orchestras, paid over £150,000 during 2018/19 (2017/18: four).

During 2018/19, spend on on-air roles represented 10% of total internal creative content spend (2017/18: 11%).
Severance payments
Our redundancy policy is one month’s pay for each year of service up to a maximum of 12 months’ pay (for those who joined before
January 2013 it is a maximum of 24 months’ pay). We have maintained a cap on redundancy and severance payments of £150,000 and
await further clarification on the Government’s proposed cap which we understand will apply to the BBC. Redundancy payments over
£75,000 and all other severance payments are approved by the Senior Management Remuneration Committee.
Where redundancy pay is paid, notice is served. If an individual wishes to leave earlier than the end of their notice period, they must waive
the remaining notice period and they do not receive payment in lieu for it.
In 2018/19, we paid ten payments in lieu of notice (‘PILONs’) to staff who left the organisation. Eight of those were paid with redundancy
pay to employees who were involved in a TUPE transfer involving a relocation overseas. The other two PILONs did not involve a severance
payment.
2018/192017/18

Spend
£000s

Volumes

Spend
£000s

162

25

310

56

£10,000 – £50,000

3,169

113

8,189

265

Payment band

Under £10,000

Volumes£50,000 – £75,000

3,407

56

8,357

136

£75k,000 – £100,000

3,278

38

7,753

91

£100,000 – £150,000

7,820

64

12,327

97

Over £150,000
Total

84

BBC Group Annual Report and Accounts 2018/19

0

0

0

0

17,836296

36,936645

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S T R AT E G I C R E P O R T

BBC Academy training
Reach2018/19

Total training completions*Face-to-face %Online %BBC staff who completed one or more course

118,048
28%
72%
90%

Total learning and development hours face-to-face & online

313,763
2.0

Number of learning and development days per EFT
Total online usage**

84,628

Value for money

2018/1912.9£617

Training delivery spend (£m)***Learning and development cost per EFT****
Training data and EFT figures are BBC wide, including PSB, BBC Studios and other commercial subsidiaries.
*
Individual face-to-face and online training completions.
**Individual online course completions and those with ‘in progress’ status.
***
Total Academy training delivery spend excluding major projects.
**** Total Academy training delivery spend divided by total EFT.

Information provided in line with the Trade Union (Facility Time Publication Requirements) Regulations 2017 – schedule 2(1 April 2018 – 31 March 2019)
During the last 12 months, we have continued to work closely with our recognised Trade Unions in implementing signification changes
to Terms & Conditions and build on our positive and constructive relationships with our unions. No strike action was taken in 2018/19.
As part of the Trade Union (Facility Time Publication Requirements) Regulations 2017, public authorities are required to report
information about facility time taken by trade union officials for a 12 month period. (Facility time refers to the time taken for ourrecognised trade unions to represent members both individually and collectively in a range of issues across the BBC). This is detailed
in the table below.
Relevant union officials
2018/19

Number of union officials
Percentage of time spent on facility time316
(EFT: 300)
Number of employees

00%1% – 50%309

51% – 99%

0
7*

100%
Total cost of facility time£689,229

Total eligible PSB paybill**£1,183.4m
0.06%

Percentage of total paybill spent on facility time
Paid trade union activities

Time spent on paid trade union activities as a percentage of total
paid facility time hours

80%

Information provided in line with the Trade Union (Facility Time Publication Requirements) Regulations 2017 – schedule 2 (1 April 2018
– 31 March 2019).
This information has been provided based on approximated numbers on known union representative numbers.
* Equivalent to five EFTs.
** Total eligible PSB paybill is calculated as stipulated in the TU legislation, which returns a nominally different figure than the reported paybill on page 214, however, thepercentage of time spent on facility time is the same.

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BBC Group Annual Report and Accounts 2018/19

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F I N A N C E , P E O P L E A N D O P E R AT I O N S

Volume of internal complaints
The BBC has a zero tolerance approach to all forms of bullying, harassment and sexual harassment. The following table summarises
the volume of internal complaints received in the year in relation to allegations of this kind of behaviour. During the year, we publisheda refreshed Bullying and Harassment policy and have run a number of campaigns, encouraging staff to speak up about these issues andto report incidents, though a variety of means, should they arise. This has led to an increase in case numbers year on year, which is to be
expected given the scale and impact of our campaigns – we welcome the fact that our staff feel enabled to raise issues and to have themproperly looked at. Data of this sort is not published by other, similar organisations, so we are unable to compare our performance.
Complaints made and investigated2018/192017/18

Bullying and harassment
Grievance complaints notified either
direct to HR, via a grievance being raised,or via the confidential bullying andharassment helpline.

86 formal cases*— 5 sexual harassment— 81 bullying and harassment— 52 closed— 24 ongoing— 10 withdrawn
Average time to close case: 108 days

51 formal cases— 5 sexual harassment— 46 bullying and harassment— 37 closed— 13 ongoing— 1 withdrawn
Average time to close case: 78 days

Whistleblowing cases
Whistleblowing allegations are received
either via Expolink, who manage an
independent whistleblowing hotline
on our behalf, via senior management
including the Senior Independent Director,
or directly to the Business Assurance andInvestigations teams.

26 cases in total (covering a range ofissues covering safety, theft, fraud):— 6 upheld— 14 unsupported— 6 ongoing

15 cases in total (covering a range ofissues covering safety, theft, fraud):— 2 upheld— 8 unsupported— 5 ongoing*

In addition, in 2018/19, 8 cases were heard as disciplinaries, relating to complaints of Bullying and Harassment misconduct dealt with outside the grievance process. The 2018/19
figures include International (non UK) cases.

86

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

Finance andoperations

NON-FINANCIALREPORTING
INFORMATION(NRI) STATEMENTOur goal is to ensure that the organisation is run as
efficiently and effectively as possible and to redirectspending and simplify procedures in a way that
supports a sustainable and more creative BBC.

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BBC One landmark drama Les Misérables

We acknowledge the non-financial
reporting requirements of theCompanies Act 2006 and have disclosed
relevant associated information
throughout the strategic report. Forease of reference, information relating
to the five matters covered by theregulation can be found on the following
pages: Environmental (page 63); Ourpeople (pages 76 to 86); Human rights(page 82); Social (pages 62 to 65); Anticorruption and anti-bribery (page 82).
Further information can also be foundon our business model (page 98), ourprincipal risks (page 127) and ournon-financial performance (throughout
the strategic report, pages 8 to 95).

BBC Group Annual Report and Accounts 2018/19

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F I N A N C E , P E O P L E A N D O P E R AT I O N S

Chief Financial Officer’s Review

In a challenging media landscape wecontinue to focus on reinventing the
BBC for our audiences.
We end the year in a financially resilient
position although this is the first yearof the staged reduction in government
funding for over-75 licences, decreasing
our licence fee income from £3,830 million
to £3,690 million. This decrease wasanticipated in the licence fee settlement
and, as planned, we have managed the
reduction in income by drawing down on
our cash reserves in the year, reducing
our Public Service cash balance by£166 million to £269 million. We havealso delivered £153 million of annual
savings in 2018/19, helping to mitigate
reduced income and enable investment.
Savings have been delivered across allareas, with particular focus on further
reducing overheads and support costs
and our overheads are at industry-leadinglevels, at around 5% of our total costs.
Through careful financial management
we have maintained our content spend
and delivered distinctive and compelling
content such as Bodyguard, Strictly
Come Dancing and Dynasties. This year
we have launched BBC Sounds and the
BBC Scotland channel and improved
our iPlayer offering. Spend can varysignificantly from year to year due tothe timing of major sporting events, andas a result and as expected in 2018/19
we are in an operating deficit position

88(£52 million deficit) compared to thesurplus position last year (£244 million
surplus). Overall, the BBC’s financial
objective is to manage to a break-evenincome and expenditure result over time,
whilst ensuring adequate financial liquidity
to manage timing differences in income andpayments and provide some contingency
in the form of financial reserves.
Our commercial subsidiaries havedelivered an encouraging performance.
Despite facing challenging competition,
BBC Studios, BBC Global News and BBC
Studioworks have all increased EBITDA
year-on-year. The BBC Commercial Group
has achieved EBITDA of £173 million, a£70 million increase year-on-year. Ourcommercial subsidiaries are managed andbenchmarked against their competitorsand EBITDA. In the year, BBC Worldwide
and BBC Studios have successfully merged
to form a single integrated brand. This has
represented an opportunity to strengthen
intellectual property generation andenhance content supply, helping to secure
the future of the BBC as a long-term
creator and owner of the highest quality
British content. A BBC Commercial Groupdividend of £73 million has been declared
to the Group, a significant increase on lastyear’s dividend (2017/18: £38 million).

BBC Group Annual Report and Accounts 2018/19—£153 million of annual savings
delivered in 2018/19. This takes
our cumulative savings to£397 million of our challenge todeliver £800 million of savingsby 2022.

—

Cash reserve of £468 million
which enables us to manage
through the changes required
as government funding for theover-75 licences is phased out
by June 2020.

—

Overheads are at industry-leadinglevels, at only 5% of our total costs.

—

A year of focused investment incontent, including major sporting
events, with our coverage of theFIFA World Cup and theCommonwealth Games; criticallyacclaimed drama; and the launchof BBC Sounds and BBC Scotland.

—

Strong commercial performancefrom our subsidiaries with
year-on-year EBITDA (earnings
before interest, tax, depreciation
and amortisation) growth of 68%
and a near doubling of thedividend to £73 million.

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S T R AT E G I C R E P O R T

In terms of regulation and governance,
in November 2018 Ofcom concluded
that the BBC’s 2018/19 plans for BBC
iPlayer were material and directed the
BBC to carry out a Public Interest Test.
The BBC subsequently published aconsultation on its proposals to extend
the availability of content on BBC iPlayerand submitted it to Ofcom. Ofcom
plans to complete its assessment andmake a final decision by August 2019.
We continue to reduce our property
estate and create modern and efficientworking environments. Since 2017 wehave closed a number of satellite London
properties. Additional focus on making ourcore London property more efficient hasenabled us to accommodate new staff for
the World Service. BBC Wales teams will
be relocating from a 50-year-old building
into Cardiff Central Square over the
coming year, which will reduce the property
footprint in Cardiff by nearly a half. Work
has started on New Broadcasting House
Belfast to create a modern, more flexible
and efficient space in a building which dates
back to the 1940s. With the London Legacy
Development Corporation and partners
we are also part of the redevelopment of
East Bank, which will provide a modern
home for our orchestras and live music
output in a new world-class cultural hub.
Looking ahead
The UK media landscape is changing
rapidly. This along with the reduction inincome has driven the need for savings
and reprioritisation of spend. The media
habits of our audiences are vastly different
compared with five years ago. Younger
audiences, in particular, consume less BBC
output owing to increased competition
for their time from other media providers
and other forms of entertainment. We
will continue to innovate online, keeping
pace as more audiences choose to accessservices and content digitally. This
includes improving the appeal of iPlayer
to younger generations by increasing
content availability and offering full box
sets of selected returning titles. In another
innovation, the BBC and ITV are planninga strategic partnership to bring a new
streaming service to UK audiences, BritBox.

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At the end of the financial year BBC
Studios reached a significant deal with its
joint venture partner, Discovery Inc, on
the future of UKTV’s channel businessin the UK. BBC Studios will acquire theseven channels most closely aligned
to the BBC’s content strategy – Alibi,
Dave, Drama, Eden, Gold, Yesterday
and W – along with digital player UKTV
Play, and the UKTV brand. BBC Studios
and Discovery have also agreed a multimillion pound, multi-year global content
partnership in two parts. This will see
BBC Studios provide premium factual
series, including natural history landmarks,
for Discovery’s new global streaming
service, and a bespoke development
deal for BBC Studios to cultivate ideas
for future Discovery commissions.
With this deal BBC Studios can begin theprocess of creating further ‘windows’
for content, providing audiences withincreasing opportunities to watch highly
valuable content – both from Studios andthird party producers – while delivering
long-term returns for licence fee payers.
The BBC’s cash balance at the end of theyear is £468 million, a £55 million decreaseon prior year. Loans of £203 million in
the commercial subsidiaries and financeleases offset the cash position to reachgroup net debt of £365 million, wellwithin our borrowing limits. An increasein borrowing limit is required due tomandatory accounting changes (IFRS 16:
Leases) which applies to the BBC from
1 April 2019 and results in additional
leases coming onto the balance sheet.
The new borrowing limits for 2019/20
have been agreed with the Department for
Digital, Culture, Media & Sport (DCMS).

Pressures from the external market
continue. The last few years have seenfunding challenges due to high inflationin areas such as drama and comedy, more
recently expanding to other key areas of
our output, such as factual programming.
In addition, the cost of sports rights
continues to grow whilst, overall, thecost of ideas and talent has also risen
fast. At a time when major well-funded
new entrants such as Amazon and Netflix
are increasingly dominating the market,
further savings will significantly impact
our ability to compete and engage with
our audience. Whilst others have been
investing, the BBC has saved an averageof 4% a year for the last ten years.
Reinventing the BBC at a time of such
unprecedented pressure will requiredifficult choices to be made. We havemade a strong start through carefulfinancial management and delivery ofsavings, but there is still much to do tomaintain our financial stability while also
operating in the global media marketplace
to meet audience expectations.

Glyn Isherwood
Chief Financial Officer
20 June 2019

Our future funding is impacted by the
Board’s decision on the over-75 licenceconcession, as set out by the Chairman
on page 9. As we said in our consultationon this issue, funding a full over-75
concession would have required savingsand cuts over and above the £800 million
currently planned, leading to substantialchanges to our content output, whichaudiences enjoy. Delivery of our underlying
plans remains challenging and we willcontinue to focus on reinventing the BBC,with careful prioritisation of the BBC’s
resources to meet our public purposes.

BBC Group Annual Report and Accounts 2018/19

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Financial overview
How we use the licence fee
The way in which the BBC is funded
places significant responsibilities
on the organisation:—

to provide value for money by focusing
expenditure on the programmes andservices the public most want fromthe BBC;—

to ensure that the output is thendelivered as cost efficiently as possible;—

to ensure effective and efficientcollection of the licence fee; and—to maximise funding from othersources in a manner consistent withthe terms of its Charter and otherobligations.

The commercial subsidiaries continue
to generate income for the BBC Groupthrough dividends and investment incontent. During the year, BBC Worldwide
and BBC Studios have successfully merged
to form a single brand, and delivered yearon-year EBITDA growth of £54 million.
Global News increased their EBITDA
by £6 million to £8 million following a
successful year in which they integrated
advertising sales into their operations.
A dividend of £73 million (2017/18:£38 million) was declared by BBC
Commercial Holdings Limited to PSBGroup driven by returns generated in
BBC Studios, BBC Global News andthe first dividend in its history was
declared by BBC Studioworks.

Other income has decreased by £33 million,
from £1,232 million to £1,199 million,
largely due to a reduction in sale ofphysical and digital products of titles
and subscription fees in BBC Studios.
Spend
The BBC concentrates its expenditure on
the production of programmes and othercontent and its delivery to audiences andusers, and the essential infrastructure to
support production. Total PSB content
spend increased by 9% to £2,860 million(2017/18: £2,623 million) this year, which
was largely due to additional investment
in our coverage of the FIFA World Cup
and Commonwealth Games, the launch of
the BBC Scotland channel and spend innations and regions on programmes suchas Back in Time for the Factory and Deathand Nightingales. The commercial business
continues to perform extremely well in
premium content, and is working actively todevelop its programming pipeline. Strong
cost control in BBC Studios has enabled
the business to deliver EBITDA growth
despite challenging market conditionsin the consumer product business. Key
productions delivered by BBC Studios in theyear included acclaimed dramas like Luther,
Silent Witness, MotherFatherSon and Les
Misérables (a co-production with its wholly
owned independent production company
Lookout Point); world-class natural history
including Dynasties and Earth’s GreatRivers; and impactful science like Horizon
and The Truth About…The Menopause.

Results for the year
Our results for this year show an accounting
deficit, at group level, of £69 million(2017/18: surplus of £180 million). The
year-on-year change is partly attributable
to the cyclical impact of major sporting
events this year, such as the FIFA World
Cup and the Commonwealth Games. We
have also invested in our digital offering by
expanding the availability of programmeson iPlayer and launching the new BBC
Sounds product. This has been fundedpartially by cash conserved in the earlyyears of the licence fee settlement tobridge the time it takes for savings to
be delivered and become established.

IncomeTotal licence fee income decreased by 4%,or £140 million, from £3,830 million to£3,690 million. This decrease was due to aphased reduction in government funding
for free licences to the over-75 populationahead of the transfer of policy to the BBC
in 2020. Under the licence fee settlementagreed with the government, £468 million
was received in 2018/19 compared to£655 million in 2017/18, a reduction of£187 million. This was partially offset by
the CPI inflation increase applied to thelicence fee from £147.00 to £150.50.

LICENCE FEE SPENDHow your monthly licence fee is spent
2018/19 £12.54 per household (2017/18: £12.25)—— Increase in licence fee has funded
additional content in television,
radio and online.
—— 5p in every £1 is spent distributing
our services to audiences.
—— The cost of collecting the licence fee
is 2.5p per £1 collected.

90

BBC Group Annual Report and Accounts 2018/19

Television
2017/18

£6.92
£6.40

Radio
2017/18

£2.17
£2.06

BBC World Service
2017/18

£1.24
£1.06

Other services andproduction costs
2017/18

£0.80
£0.67

BBC Online
2017/18

£1.08
£0.91

Licence fee collection
and other costs
2017/18

£0.33
£1.15

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S T R AT E G I C R E P O R T

Summary consolidated income statement
For year ended 31 March 2019
2019
£m

2018
£m

The total of licence fees collected

3,690

3,830

Commercial income and grantincome

1,199

1,232

4,889

5,062

(4,977)(4,854)36

36

Income statement classification

What is it?

Licence fee income

Other income

Total income
Operating costs
Share of results of associates andjoint ventures

The cost of producing all content
and of running the BBC
Our share of the profit ofbusinesses where we control 50%
or less

Group operating (deficit)/surplus

What has happened?

3.7% decrease due mainly tophased reduction in government
funding of free TV licences toover-75 population
Decrease due to decline in the
consumer products (DVD)business
Investment in major sporting
events and drama
UKTV and New Video Channel
America(52)

244

Gains on disposal

Profit on disposal of operations
and fixed assets

36

5

Other gains and losses

Net gain on movements infinancial instruments

7

25

Net financing costs

The net interest on the BBC’s
pension assets and liabilities,
interest on loans and fair value
movements on derivatives

(65)

(95)

Taxation

The net tax liability of the BBC on
its taxable profits

51Group (deficit)/surplus for the year

(69)

180

COMMERCIALPERFORMANCE

2018/19
EBITDA

2017/18
EBITDA% year-on-year
growth

£159m

£105m

51%

£8m

£2m

300%

£6m

£3m

100%

—— Strong commercial performancefrom our subsidiaries with year-onyear EBITDA growth of 68%.
—— Returns generated in BBC Studios,
BBC Global News and the firstdividend in its history declared by
BBC Studioworks, despite
challenging market conditions.
—— Dividend of £73 million (2017/18:£38 million) was declared by BBC
Commercial Holdings Limited to
PSB Group.

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In 2018/19 a gain was recordedon the sale of the Good Foodbusiness
Gain in fair value on financial
instruments in BBC Studios

Reduction due to fair value
movements on financial
instruments relating to loans
and variation in the charge
relating to pension liabilities
Increase in high end television
tax credits received

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F I N A N C E , P E O P L E A N D O P E R AT I O N S

Cash and net debt
The BBC’s cash balance at the end of
the year is £468 million, a £55 million
decrease on the prior year in part due
to the reduction of over-75 funding. As
a result of the licence fee settlement wehave preserved a cash surplus ahead of the
reduction in government funding for freeTV licences for the over-75 population.
2018/19 was the first step down in income
from the government and a further
decrease is due in 2019/20. The cash
surplus will be used to continue to deliverworld-class content to BBC audiences
whilst meeting future obligations (which
include World Service and pension deficit
repayments) and managing the cost andtiming of delivering savings programmes, in
anticipation of funding licence concessions
for the over-75 population. Commercial
Holdings Group has a cash balance of£199 million, part of which will be used
to complete the UKTV acquisition.
The BBC’s net debt at the year end
includes £651 million of finance leases
and £203 million of loans utilised by thecommercial subsidiaries; this is offset
by a cash balance of £468 million and£21 million of derivatives. The BBC’s net
debt levels have increased by £39 million.
The BBC Commercial Group are in a
£17 million net funds position comparedto £88 million net debt in 2017/18.
New borrowing limits for 2019/20 havebeen agreed with the DCMS, which
increase the PSB net borrowing limit
from £1,050 million to £2,200 million, of
which £2,000 million is specifically forleases. A borrowing limit of £500 million

will apply to the BBC Commercial Group,of which £150 million is specifically forleases. An increase in the limits was
required due to mandatory accountingchanges, IFRS 16, which applies to the
BBC from 1 April 2019 and results inleases coming onto the balance sheet.
Licence fee collection
Effective financial management is a key
part of the BBC’s unique relationshipwith its audiences. This includes spending
the licence fee efficiently and collecting
a television licence fee from everyone
who is required to buy one. The BBC has
a number of contractual arrangements
covering collection, administration andenforcement of the licence fee, marketing,payment channel management and retail
networks. The majority of administrationis contracted to Capita Business Services
Ltd. This is the seventh year of the current
collection contract – which has delivered£180 million of savings to date. Total costsavings of £220 million are expected to
be delivered over the ten years of thecontract, releasing more funding to be
spent on our programmes and services.
Licence fee statement
As in previous years, the BBC preparesa licence fee revenue statement auditedby the NAO. This sets out the amounts
collected and paid over to HM Government
during the year. Alongside their audit
work, the NAO examines our collection
arrangements and reports on them to
Parliament. More on the licence fee revenue
statement can be found on the NAO
website: nao.org.uk/report/bbc-licence.

Pension costs
At 31 March 2019, the accounting
pension deficit (as defined by IAS 19
Employee Benefits) had increased to£530 million, compared to £518 million
a year ago. The increase during thecurrent year was due to an annual
operating charge of £231 million andnet finance costs of £10 million, offset
by a net gain from changes in thevaluation assumptions of £38 million
and contributions paid of £191 million.
This accounting valuation is only a‘snapshot’ at a particular date, and istherefore sensitive to short-term market
fluctuations. It has no impact on theactual cash cost of paying down thepension scheme deficit, which is reviewed
at triennial actuarial valuations.
The most recent triennial actuarial
valuation was completed in June 2017 andshowed a funding shortfall of £1,769 million
as at 1 April 2016. A repayment plan
was agreed between the BBC and thePension Scheme Trustees which runs until
31 December 2028. This plan is considered
to represent an affordable basis to address
the deficit, without compromising services
to audiences. The next formal actuarial
valuation of the Scheme as at 1 April
2019 is expected to be completed by thestatutory deadline of 30 June 2020, at
the latest. The BBC continues to workwith the Pension Scheme’s Trustees toensure the Scheme delivers security formembers and value for licence fee payers.

Net debt (£m)
(300)
(326)

(171)

(340)
24
(365)

116
(380)

1
(9)

(420)

(460)

(500)

2017/18
Net debt

92

BBC Group Annual Report and Accounts 2018/19

PSB cash
movements

Commercial
cash
movements

Loan
Net exchange rate Financemovements and derivative
lease
valuation
movements
movements

2018/19
Net debt

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S T R AT E G I C R E P O R T

Tax strategy
The BBC is committed to paying theright amount of tax (employment tax,
VAT and corporation tax) at the righttime, in all the jurisdictions in which it
operates. The BBC takes its tax complianceobligations seriously. The BBC does notenter into any transactions with a viewto artificially or aggressively reducing its
tax liability. The BBC published its tax
strategy inaccordance with the FinanceAct 2016.It can be found on the BBC
website bbc.co.uk/aboutthebbc/reports/
reports/. The BBC communicates with
HMRC in an open, transparent manner andresponds in a timely manner to queries
and requests for information. There is aconstructive and continuing dialogue with
HMRC on new issues, consultations, anychanges to tax legislation or compliancerequirements throughout the year.
In 2017, the Government introduced newlegislation relating to the tax accountability
for payments to intermediaries in the public
sector. Alongside it, HMRC introduced a
new analysis tool for employment status(the Check Employment Status for Tax – theCEST) and other written guidance which
continues to be revised and updated.
These two changes have led to a numberof new questions and issues arising in
relation to the assessment of tax status forindividuals across the industry, as the new
guidance indicates that a larger proportionof on-air presenters should be treated as
employed for tax purposes than previously.
A number of on-air presenters, across theindustry, are facing investigations from
HMRC about how tax and NI has been
applied in the past to their engagements
via a Personal Service Company (PSC) –the most popular form of intermediary.
The BBC has always sought to act within
the established guidelines, but this is
a complex area. We have been working
closely with BBC presenters as well aswith HMRC to resolve them as quickly
as possible. We want to do this in a way

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which is fair to the individuals involved,
to the HMRC and to licence fee payers.
We fully understand and regret the stress
this has caused to the people affected,
which is why we are supporting themand want to find an effective way to
put this right as quickly as possible.
In last year’s Annual Report and Accounts
we noted a contingent liability should the
BBC be required to make payments undera mediation scheme which was being
considered. This scheme was intended
to assess any cases where it would bereasonable for the BBC to bear the costof the tax and NIC due as a result of any
employment status misclassification.
Since then we have focused on discussing
options with HMRC for an overall
settlement which can provide certainty
about the tax treatment of BBC fees
paid to presenters. These discussions
continue and, in March 2019, the BBC
Board approved a set of principles that
we intend to use to ensure fairness andconsistency in how we calculate the BBC’scontribution to any outstanding amounts
sought by HMRC. These would apply either
to an overall settlement with HMRC or toan approach of resolving individual cases
where presenters are being investigated.
Our approach would involve the BBC
covering any difference between thetaxes (PAYE and National Insurance
contributions) that would have been due
from the PSC under the new HMRC rules asagainst the total that would be owed by the
PSC and individual under corporation anddividend tax rules, for BBC income only.
We have also put in place access to
support and advice for those affected.

could also potentially be seen to create
an obligation, even if not a strict liability.
Our aim remains to settle the historic
issues, at an acceptable cost to thelicence fee payer, by resolving most of
the retrospective claims that HMRC may
have against the presenters or the BBC
in respect of any misclassification of theiremployment status. The Board considers
that a settlement option with either HMRC
or individual presenters is in the bestinterests of the BBC, the licence fee payer,
and the individuals involved and is likely to
be both less costly and quicker to resolve.
Should cases be resolved with individuals,
any payments to, or on behalf of, presenterswill only be made where there is alegitimate demand from HMRC and where
the BBC can determine the amount due.
This would be based on the difference ofthe tax that would be due under IR35 versus
that which is due by the PSC and individual
paying corporation and dividend tax.
Within the 2018/19 BBC accounts,
a provision of £12 million is included
for such payments. The provision
has been estimated by looking at allindividuals affected and then applying
assumptions, based on conversations
with HMRC; recent tax tribunal rulings;
and the advice of external advisors.
These transactions are considered irregularbecause the BBC does not have a legal
liability for the tax owed. Under the termsof the Charter all BBC expenditure must be
for the BBC’s intended purposes. However,
the approach has been approved by the
Board on the basis that it offers the bestvalue for money of the available settlement
options and also resolves the historic
issues in a way which is fair to all sides.

The BBC Board made this decision taking
into account the impact on presenters,
the majority of whom are not highly paid,
and the value for money of the available
settlement options. It reflects that insome cases the BBC may have required
the use of PSCs by presenters which

BBC Group Annual Report and Accounts 2018/19

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F I N A N C E , P E O P L E A N D O P E R AT I O N S

Delivering efficiencies

Cardiff Central Square

Our goal is to ensure that theorganisation is run as efficiently andeffectively as possible, and to redirect
as much money as possible to content
whilst simplifying procedures in a waythat supports a sustainable and morecreative BBC. In October 2018 wepublished ‘A Simpler BBC’, detailing
our strong track record of delivering
efficiencies and making the BBC
simpler, leaner, and more efficient.
Since 2010, licence fee funding for BBC
UK services is 24% less than had thelicence risen with inflation. During thistime the BBC has taken on a numberof new commitments including funding
World Service, S4C and BBC Monitoring.
Despite this funding reduction, the BBC
has managed to maintain quality andreach due to a substantial and extensive
programme of cost management. We are
addressing our future financial challenges
by seeking to find £800 million of savingsby 2021/22. We are making good progressagainst the target, delivering £153 millionof annual savings this year, taking the
cumulative savings to £397 million.

94‘Compete or Compare’ has given us asustainable framework for continuous
improvement. The framework ensuresthat everything we do is competed in
the market or compared (benchmarked)
against it. This drives up quality andreduces costs. An internal review during
the year concluded that 94% of BBC
controllable spend satisfied the ‘Competeor Compare’ criteria, either through directcompetition or rigorous comparison andbenchmarking, a significant increase overthe past four years, from 80% in 2014/15.

Our property
footprint will
improve further thisyear as BBC Wales
staff move into one
building, Cardiff
Central Square,
which is nearly halfof the size of thebuildings it replaces.

With savings focused on central costs,
we have brought down overheads toindustry-leading levels: just 5% of our
total costs in 2018/19. This puts us in
the most efficient 25% of benchmarked
international telecommunications andmedia companies as well as regulated andnon-profit organisations in the country.

BBC Group Annual Report and Accounts 2018/19

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S T R AT E G I C R E P O R T

Cutting our property bill is another key partof our business strategy and our property
footprint is now around 40% smaller
than in 1998 – a significant achievement.
Since 2017 we have vacated Grafton
House, Brock House, Great Portland
Street, Euston Square, Centre House andCaversham. Our property footprint will
improve further this year as BBC Wales
staff move into one building, Cardiff Central
Square, in the autumn, which is nearly halfof the size of the buildings it replaces.
Focus on moving teams outside ofLondon continues, with an ambition tohave half of our staff in offices in thenations and regions. Further reductions
to the size of the estate are expected
in order to reach the 355,000m2 UK
property estate target by 2020 – a
reduction of over 20% since 2014.

Between 2012/13 and 2018/19 spend on
major strategic contracts reduced from£684 million to £353 million, a saving of
48%. Managing supplier performance,
automation and transforming the
procurement process have all been
instrumental in securing these savings.
Dedicated supplier contract managers
are strengthening the BBC’s contract
management by tracking performanceagainst business requirements.
Technology
Technology services is another area where
the BBC is making significant savings. The
BBC has moved to a new IT service model
managed by a strong in-house operations
team which includes responsibility forcyber security. Rather than a single supplier,specialist suppliers now run specificservices in a more efficient and flexible way.

Procurement
The BBC regularly reviews the financial
standing of its major outsourced service
suppliers, which includes analysing
reports from external commercial credit
agencies. The contractual arrangementswith these suppliers include open bookaudit provisions as well as comprehensive
business continuity and exit obligations.

EFFICIENCY SAVINGS———£712 million of sustainable savings
achieved during Delivering Quality
First programme, which finished in
April 2017.
£397 million of sustainable savings
achieved to date to address our
future financial challenges.
Over £800 million of savings
targeted by 2022.

The Virtual Local Radio (ViLoR) project
was completed in early 2019 which
involved upgrading studio equipment
and centralising background technology,
introducing a new approach to making
radio. The upgrade has made it easier tointroduce software updates, new featuresand new capabilities across BBC local
radio and to share audio across both
local and network radio. OpenMedia,
a new newsroom computer system,has been successfully rolled out acrossseveral regions and radio services andfull transition will complete in the next
year. OpenMedia is an upgrade on a news
management system that had been in use
at the BBC since the 1990s, and is designed
for the modern newsroom allowing more
flexible working and cross platform sharing.
Savings continue to be achieved acrossthe major technology contracts,
including over £30 million achieved in
2018/19, enabling further long-term
efficiencies as our online media volume
and capacity requirement grows.

Ongoing savings, £m
1,000

270

800

226

69

600

0

540

2019/20

2020/21

566

397

400

200

543

244

2017/18

2018/192021/22

At risk and requiring service or content changes
New programme

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BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

Governancep.98

BBC Board
The Board is responsible for
ensuring the BBC fulfils its mission
and public purposes as set out in
the Charter.

This section looks in detail at the role of the BBC Board andincludes reports from the Board’s delegated sub-committees.
The section also includes detail on our overall approach tocorporate governance, our regulatory position and affirmationof the Board’s duties in relation to the Annual Report.

Strictly Come Dancing 2018’s Lauren Steadman and AJ Pritchard
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G OV E R N A N C E

p.122
Audit and Risk Committee Report
This reviews and maintains
oversight of the BBC’s corporate
governance, particularly withrespect to financial reporting,internal control and risk
management.

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p.102

p.111

Remuneration Report
This report sets out the BBC’s
remuneration policy for executive
directors and details the annual
remuneration received by the membersof the BBC Board, Executive Committee
and Commercial Holdings Board for the
2018/19 financial year.

Pay disclosures
Under the terms of our Charter we are
required to publish the names of people
working for the BBC who are paid morethan £150,000 from licence fee revenue.

p.133

p.134

Commercial Holdings Board
The Commercial Holdings Board
oversees the BBC’s commercial activities.
It sets strategy in line with overall BBC
Group company goals, agrees businessplans and ensures compliance inregulatory and legal matters.

Editorial Guidelines and Standards
The Editorial Guidelines and Standards
Committee is responsible for content
standards at the BBC.

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G OV E R N A N C E

BBC Board
The Board is
responsible for
ensuring the BBC
fulfils its mission
and public
purposes as set
out in the Charter.

The Board is constituted under theterms of the BBC’s Royal Charter andAgreement. The Charter sets out theBoard’s responsibilities, its membershipand the requirement for a number ofCommittees to support its work. The
Board is responsible for the proper,
effective and independent exerciseof all the function of the BBC. It sets
the strategic direction for the BBC
and approves the creative remit andthe budgets for the BBC’s services.
The Board is chaired by Sir David
Clementi and consists of up to ten
non-executive directors – including the
Chairman – and four executive directors,
including the Director-General.

SIR DAVID CLEMENTI
ChairmanTONY HALL, LORD HALL OF
BIRKENHEAD CBE
Director-General and
Editor-in-Chief

SIMON BURKE
Non-executive director
Senior Independent Director
Chair, Audit and Risk Committee

TIM DAVIE CBE
Chief Executive, BBC Studios

TOM ILUBE CBE
Non-executive director
Chair, Fair Trading Committee

KEN MACQUARRIE
Director, Nations and Regions

DR ASHLEY STEEL
Non-executive director
Member for England

DAME ELAN CLOSSSTEPHENS DBE
Non-executive director
Member for Wales
Chair, Commercial Holdings Board

The Chairman and the four nations’ nonexecutive directors are appointed by HM
The Queen on the recommendation of
Ministers. The remainder of the Board
are appointed by the BBC, through theBoard’s Nominations Committee.
Full biographies of all Board members,
including their other roles, can befound on the BBC’s website: bbc.com/
aboutthebbc/whoweare/bbcboard.
The Board delegates some of its
responsibilities to a number ofsubcommittees. It is required tohave a Remuneration Committee, aNominations Committee and an Audit
and Risk Committee. The work of theseCommittees is complemented by thework of a number of other Committees,
established by the Board – theseinclude the Fair Trading Committee,
the Editorial Guidelines and Standards
Committee and Committees for eachof the four Nations of the UK. During
the year, the Board also agreed toconstitute the Commercial Holdings
Board as a formal, subcommittee.

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G OV E R N A N C EThis section includes reports from thosecommittees, which are chaired by andpredominantly made up of non-executive
directors, as required by the Charter.
These pages show the membershipof the Board as at June 2019.

TANNI GREY-THOMPSON,BARONESS GREYTHOMPSON DBE
Non-executive director

During the year, the Nominations
Committee approved one change to
Board membership – Anne Bulford,
Deputy Director-General, stepped
down from the Board on 31 March
2019 and was replaced by Francesca
Unsworth, Director of News andCurrent Affairs from 1 April 2019.

IAN HARGREAVES CBE
Non-executive director
Chair, Editorial Guidelines andStandards Committee

The Board member for Northern Irelandis yet to be appointed, pending theconstitution of a new Northern Ireland
Executive. In the absence of a member
for Northern Ireland, the Committee forthe nation is chaired by Ken MacQuarrie,
Director of Nations and Regions.
Detail on members’ attendance at Boardand sub-committee meetings is set out
on page 108.

STEVE MORRISON
Non-executive director
Member for Scotland

SIR NICHOLAS SEROTA CH
Non-executive director
Chair, Remuneration Committee
Find out more:

FRANCESCA UNSWORTH
Director, News and Current Affairs

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G OV E R N A N C E

Executive Committee
To support and implement the work of
the Board, the Director-General chairs an
Executive Committee, which is responsible
for the day-to-day running of the BBC.
The Executive Committee is responsible fordelivering the BBC’s services, in accordancewith the strategy agreed by the Board, andfor all aspects of operational management.
The Executive Committee meets regularly
and oversees key strategic projects andproposals of importance to the wholeorganisation. It takes regular reports
on audience and financial performance,
as well as maintaining oversight of
pan-BBC HR and organisational design
issues. It also discusses and approves all
relevant papers discussed at the Board.
During the year, the membership of the
Executive Committee expanded, to ensure
representation of all significant areas of
output, operations and management.
Page 108 sets out changes to the
Executive Committee during the year.
Anne Bulford, Deputy Director-General,left the BBC in April 2019 and stood downfrom the Committee on 31 March 2019.
Since year end, two more members havebeen added to the Committee – Bob
Shennan as Group Managing Director, andGroup General Counsel Sarah Jones.
The members as at June 2019 were:
Tony Hall
Director-General
Kerris BrightChief Customer Officer
Tim Davie
CEO BBC Studios
Valerie Hughes-D’Aeth
Chief HR Officer
Glyn Isherwood
Chief Financial Officer
Sarah JonesGroup General Counsel
David Jordan
Director, Editorial Policy and Standards

Charlotte Moore
Director, Content
Matthew Postgate
Chief Technology and Product Officer
James Purnell
Director, Radio and Education
Gautam Rangarajan
Director, Strategy
Bob Shennan
Group Managing Director
John Shield
Director, Communications and Corporate
Affairs
Clare Sumner
Director, Policy
Francesca Unsworth
Director, News and Current Affairs
Find out more:
bbc.com/aboutthebbc/whoweare/exco

Ken MacQuarrie
Director, Nations and Regions

Next Generation Committee
The BBC Next Generation Committee(NGC) was established by the DirectorGeneral in late 2017 as a formal
sub-committee of the Executive
Committee. The Committee provides
an advisory function to ensure
younger people’s voices and ideas areheard at executive director level.

Next Generation Committee members

The NGC is composed of 15 younger
members of staff from across theorganisation. Meeting on a monthly
basis, the NGC’s activity in 2018 focused
primarily on efforts to attract, grow andretain young and diverse talent within
the BBC, and to improve the BBC’s
performance with younger audiences.
The Committee worked on projects
both big and small. These included
a focus on apprentice pay, podcast
commissioning, work experience
opportunities for under-represented
communities, and expanding an audienceengagement scheme across the BBC.
The NGC also established an employee
network for younger members of staff
to discuss and explore the particularchallenges younger staff face andprovide learning opportunities as well
as a chance to meet like-minded people
in a friendly and social environment.

For 2018

For 2019

Max Gogarty (Chair)

Hayley Reynolds (Chair)

Andrew Efah

Sowda Ali

Emma Gallacher

William Allott

Lucy Hancock

Tom Bell

Katherine Hardyment

Mairead Campbell

Seren Jones (joined June 2018)

Sarah Corker

Alex Lawless

Seren Jones

Mansha Manohar

Chinwe Kalu-Uma

Proinsias O’Coinn

Junior Kassim

Ryan Pasi (on sabbatical April-October 2018)

Jordan Kenny

Philip Raperport

Luke Mason

Kelsey Richards (retired February 2018)

Waseem Punnu

Camellia Sinclair

Jess Quayle

Charlie Slater

Owen Rawlings

Ione Wells (joined June 2018)

Ione Wells

Will Wilkin
Georgie Yates

All NGC members were pairedwith a mentor and gained
invaluable insights into leadershipand personal development.

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G OV E R N A N C E

Corporate Compliance Report
We comply with corporate governancebest practice
The BBC’s corporate governanceframework is defined in its Charter andthe accompanying Framework Agreement.
The Charter and Agreement can be foundon the BBC website at: https://www.bbc.
com/aboutthebbc/governance/charter.
The Charter requires the BBC to haveregard to generally accepted principles
of good corporate governance. Although
the BBC is not a listed company, it has
opted to apply best practice and follow
the provisions of the Financial Conduct
Authority’s Listing Rules and the Financial
Reporting Council’s 2016 UK Corporate
Governance Code, where appropriate.
This delivers the governance standards
applicable to companies quoted on
an EU-regulated stock market.
The BBC has fully complied with thecorporate governance requirementsof the Charter and Agreement and has
also substantially complied with the2016 UK Corporate Governance Code.
For 2019/20, the Financial Reporting
Council’s 2018 UK Corporate Governance
Code will become voluntarily applicableto the BBC. Work is underway to ensure
the BBC’s continued compliance withcorporate governance requirements
and during 2018/19 an effectiveness
review of the Chair, the Board and
its Committees was conducted.
There are a number of components ofthe 2016 UK Corporate Governance
Code that are either not appropriate to
the circumstances of the BBC or wherecompliance with the BBC’s Charter orAgreement overrides compliance withthe 2016 UK Corporate Governance
Code; these are set out below:—

Re-election of Directors (UK Corporate
Governance Code principle B.7).

—

Responsibility for making a
recommendation on the appointment,
reappointment and removal of theexternal auditors (UK Corporate
Governance Code principle C.3.7).

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In addition, as set out below, there are
two areas where the 2016 UK Corporate
Governance Code is not relevant to
the BBC.
Make-up of remuneration (UK Corporate
Governance Code principle D.1.1):
The BBC sets levels for executive
remuneration that should be sufficient to
attract, retain and motivate directors of
the quality required to run the organisation
successfully. However, this principle also
requires aligning executive remuneration
to the notion of enhancing shareholder
value by making performance-related
elements of remuneration a significant
proportion of total remuneration. Dueto the BBC’s licence fee funding and its
status as a public corporation, the BBC
has determined that there should be no
variable pay for any BBC Public Service
executive director and bonuses are notpaid. However, Tim Davie received anelement of performance-related pay in
his role as Chief Executive Officer of theBBC’s commercial operation, BBC Studios.
Interaction with shareholders (UKCorporate Governance Code principles
B.7.1, B.7.2, D.2.4 and section E):
The BBC is not a profit-oriented
company with shareholders and so
provisions relating to interaction
with shareholders do not apply.
Cost of compliance
In order to ensure that we complied withall relevant legislation that the BBC issubject to as a broadcaster and a publicbody, in 2018/19 we incurred compliancecosts estimated at £17 million (2017/18:£19 million). This figure includes theBBC’s annual £11 million fee to Ofcom.
Regularity
The management of all of the BBC’s
resources must accord with the provisionsof the Charter, Framework Agreement
and other agreements the BBC enters intowith Government Ministers. Transactions
that meet the intended purposes andare in line with relevant authorities are
considered to be ‘regular’; those that do
not meet these criteria are considered‘irregular’. Fraudulent transactions
and fines or penalties are treated as‘irregular’. In addition to the NAO’s review
of regularity, Internal Audit conducted areview of the BBC’s regularity complianceframework, including the processes,
controls and assurance mechanisms
in place to manage the regularity risk
in areas assessed as being at greatest
risk of irregularity. The scope of thereview considered the appropriate useof licence fee money, the assessmentof material changes, operating withinborrowing limits and the risk of fraud.
As set out in detail in the Chief Financial
Officer’s Review on page 88 the Board
has given careful consideration to issues
surrounding the BBC’s use of Personal
Service Companies and the new legislation
applied by HMRC to the public sector from2017/18. A principles-based approach wasapproved by the Board that allows for tax
and NIC settlement payments to be madeto, or on behalf of, presenters who havepreviously been paid via intermediaries.
The Board believes that this approach was
the appropriate way to resolve historic
issues with presenters around employment
status. The Board acknowledges that
this provision of £12 million is consideredirregular because the BBC does not havea strict legal liability for the tax owed.
Under the terms of the Charter all BBC
expenditure must be for the BBC’s intended
purposes. Notwithstanding this, as theBBC’s authorising body, the Board weighedup the issues and made the decision toapprove the approach and expected coston the basis that it offers the best value
for money of the available settlement
options and resolves the historic issues
in a manner which is fair to all sides.

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Remuneration Report
Chair’s statement
During the past year, pay and reward
at the BBC has been under scrutiny
to an unprecedented degree. Internaland external attention has been – andrightly continues to be – rigorousand focused on issues of fairness,transparency and efficiency.

—

Managers and leaders in the BBC are facedwith difficult challenges: achieving value
for money, attracting and retaining thebest creative talent and ensuring that new
HR systems and frameworks are properly
embedded in what are often complex areas.
All this takes place under significant public
scrutiny. Against this backdrop we, as acommittee, recognise the achievementof managers and leaders at the BBC incontinuing to address past issues while
also delivering improvements that leadthe way on transparency and fairness.

So whilst the picture across the BBC
continues to improve, we have also sought
to develop those areas specifically in our
remit. In the last year, for example, wehave debated and agreed a new policy
for senior leader pay, set out in the pages
that follow. And we continue to support
the key principle of ‘One BBC’ – that pay
and reward should facilitate movementof staff across the whole BBC group.

As the BBC moves towards clearer andmore consistent pay frameworks, it has
been our role to support, critique andmonitor this work. Our formal remit
covers executive directors – on whom
this report is focused – and the wider
senior leader population. However,
we strongly support the Executive in
believing that the core pay principles offairness, consistency, clarity, transparency
and competitiveness should apply toremuneration of all staff in the BBC group.
The facts bear out our view that
remuneration at the BBC continues to bewell managed:
—

—

102

We have seen the BBC continue to leadthe way in its gender pay gap approach,proactively monitoring remunerationlevels and taking active steps todecrease the gap year-on-year. This isdemonstrated in the published 2019
median figure of 6.7%, a reduction
from 7.6% in 2018.
Senior manager pay continues to becontrolled, with the introduction oftransparent market-informed job pay
ranges for our 250 senior leaders, inorder to deliver the BBC’s pay
principles to all employees. With
quarterly scrutiny by the Committee,
the senior manager population has
continued to form less than 1.4% of
the workforce, with the respective
paybill at £36.4 million for 2019.

The National Audit Office completed its
value for money review of pay
management in the BBC this year.
The Committee was pleased to see thatthe report recognised the ‘significant
reforms’ to pay transparency,
consistency and working practices thathave taken place in the last few years.

Indeed, on the commercial side of thegroup, this year we have continued toensure that variable pay schemes areclearly focused on those who win businessand develop returns to the licence fee, withbonus levels set with increasing stretch
and a maximum payment that representsa smaller percentage of overall salary.
We are also delighted to see theimprovements in the disclosure lists set
out on pages 111-119, showing that the
BBC is delivering on the commitments
made by the Director-General last year:
to equalise the gender split; to see more
women higher up the list; and to ensure
a better story on diversity. On each ofthese measures we have met the forecasts
made last year and on each of thesemeasures we expect the BBC to makefurther improvements in the coming year.
We shall continue to monitor this closely.

encouragement of a culture where staff
can speak openly about their pay, cansee how it compares to others and canfeel comfortable asking questions about
whether it is right. Few organisations
would have been as open and willingto embrace these debates as the BBC.
As we move into the next year, I am gratefulfor the continued support of the committee
members, Tanni Grey-Thompson andSteve Morrison, the former chair, whohave both helped to ensure that we movetowards a fairer and more transparent
BBC. Our priorities will be to continue
to ensure fair and equal pay for men andwomen across the Group, a reduction in
the gender pay gap, better representationof women and people with disabilities
and progress in achieving greater ethnic
diversity in the senior leadership.
Above all, we hope to continue to support
the Executive in addressing the challenges
we face. This means delivering fair pay,value for money, great content and a
BBC that continues to reward great
work and make work a great reward.

Nicholas Serota
Chair
20 June 2019

Of course challenges remain – attracting
and retaining the talent we need to beable to continue to lead broadcastingat a national and international level,
delivering value for money to the licencefee payers and explaining our strategy
during scrutiny from Parliament andother public bodies such as the Equality
and Human Rights Commission.
But we should be proud of what has beenachieved by the Executive this year –agreement on new terms and conditionsof work across the Corporation, a closer
working relationship with the unions,the findings of the two independenttransparency reviews, the renewed focus
on strong leadership, and the continuing

BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

Remuneration Report
This report sets out the BBC’s
remuneration policy for executive
directors and senior leaders and details
the annual remuneration received by themembers of the BBC Board and Executive
Committee for the 2018/19 financial
year. This includes our annual disclosureof pay as set out in the BBC’s Charter.
It has been prepared on the basis that therequirements of the Large and Mediumsized Companies and Groups (Accounts
and Reports) Regulations 2013 and Listing
Rules apply to the BBC wherever these
disclosure provisions are relevant. The
sections on pensions and remuneration
received by this group have been auditedby the NAO, the BBC’s statutory auditors.
The Remuneration Committee’s
constitution and operation
The Board’s Remuneration Committee,
since 1 April 2017, has been responsible
for setting the remuneration strategy
for the BBC Group and for all aspectsof the remuneration of the Executive
Committee and Board executive directors.
Its members are non-executive directors:
Tanni Grey-Thompson, Steve Morrison
and Nicholas Serota. Steve Morrison was
the Chair of the Committee until 31 July
2018 and Nicholas Serota was appointed
as the new Chair from 1 August 2018.
The Board Remuneration Committee
takes specialist advice from external
professional advisers on some matters,
particularly those relating to market
practice. During the year, independent
advice was received from Willis Towers
Watson on matters related to executive
remuneration and periodically in theform of market assessments.
The Committee makes sure that executive
remuneration is aligned to the BBC’s
purpose and values. It ensures ourarrangements are transparent and easily
understood, and that remuneration levels
are proportionate to contribution.

Board and Executive Committee
membership
For the purposes of this report,
executive directors are classed as
those who sit on the Board along withthe other members of the Executive
Committee (see page 100 for details).
The BBC Board is supported by the
Executive Committee, which is responsible
for the operational leadership of the
Corporation. Within the terms of theCharter, the Board is made up of ten
non-executive directors (the Chairman,
five BBC appointees and the four Nations
representatives) and four executive
members – see page 98 for more details.

the four Board members, plus the
Directors of Content, News andCurrent Affairs, Radio and Education,
Chief HR Officer and the Chief
Technology Officer, all of whom weremembers of the Executive Committee
in 2017/18.

—

Mark Linsey stepped down fromthe Executive Committee on
31 March 2018.

—

During the year, there have beenfurther changes, with new members
joining the Executive Committee.
On 1 April 2018, three new members
joined the Executive Committee: John
Shield as Director of Communications
and Corporate Affairs, Clare Sumneras Director of Policy, and David Jordan
as Director of Editorial Policy
and Standards.

—

There has been a continued focus
on pay at all levels of the BBC
allied to an increased focus on fairpay. Several initiatives have been
undertaken to ensure our pay
principles are embedded throughout
the organisation and to provide
a framework in which fair andconsistent pay decisions are taken.

1. Fair
2. Consistent

The Executive Committee in 2018/19
was made up of 15 members:—

BBC PAY
PRINCIPLES

Further joiners during 2018/19 havebeen as follows: Glyn Isherwood as
Chief Financial Officer on 9 April,
Gautam Rangarajan as Director ofStrategy on 1 June, and Kerris Brightas Chief Customer Officer on 18 June.

3. Transparent
4. Competitive
5. Clear
The BBC operates within a fastchanging market with intensecompetition for talent, and dramatic
growth among some new media
companies offering highly attractive
packages. We therefore continue
to balance market-competitive
pay with the need to demonstratevalue for money to the licence fee
payer. This balance is reflected inmarket informed job pay ranges
which, where external (market)
factors support, continue to bediscounted against market.
We believe that these pay principles
ensure the BBC continues to be able
to appeal to all those who are excitedabout the opportunities of working
in public service broadcasting.
More detail on this can be found in
the Our People section from page 76.

The Senior Manager Remuneration
Committee (SMRC), established in
September 2012, has responsibility foraligning the operational needs of the BBC
within the strategic framework set by the
Board. The SMRC has responsibility for
approving any remuneration, compensation
or benefit policy within the senior leader
pay policy, which includes the review andapproval of salaries for employees in the
Public Service who earn over £75,000
per annum (full-time equivalent basis).

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Senior Leadership Remuneration Policy
The Remuneration Committee is committed to setting appropriate levels of pay for executive directors that attract, motivate and retain
the best people to lead the BBC and provide value for the licence fee payer. This year the Committee agreed that the BBC’s pay principles
should apply to all staff, executive directors and senior leaders, across the BBC Group. The Committee has agreed that these pay
principles will apply as set out in the table on pages 107-108.
The BBC has extended its union-negotiated Career Path Framework to include an additional non-union negotiated career level band
called SL (senior leaders). This includes job pay ranges for all the most senior jobs. In framing our pay policy the Committee gives fullconsideration to the best practice provisions of the UK Corporate Governance Code.
Executive directors and senior leaders are not entitled to the annual pay increase agreed with the Joint Unions and are not automaticallyentitled to any form of annual increment or progression payment. Pay decisions for executive directors can only be taken by the
Remuneration Committee and pay decisions for senior leaders by the Senior Manager Remuneration Committee, to ensure consistency
and fairness.
The BBC has undertaken several initiatives over the course of the year to ensure that it fully meets the ambitions set out in this policy.
This includes the annual review of senior leaders’ pay for 2017/18 and phased diminution of historic differences in approaches to pay andbenefits between senior leaders and other staff e.g. replacement of private medical insurance benefit with a legacy allowance.
Component

Purpose and link to strategy

Operation

Maximum opportunity

Base pay

For executive directors, base pay isdefined by reference to the market
median for total direct remuneration(salary, annual bonus and annualised
long-term incentive). It is expectedthat this will result in remuneration
being significantly discounted tomarket as no long term incentives
are offered at the BBC.

The following factors are used todetermine the level of base pay
set for an executive director orsenior leader:

No prescribed maximum salaryor maximum increase for
executive directors.

For senior leaders, job pay ranges are
informed by market median total
target cash (base salary, allowances
and target bonus) guide pay decisions.
No senior leader is paid below thejob pay range minimum for theirrole, and pay ranges are transparent
to both senior leaders and the wider
BBC workforce.
Variable pay

Benefits –PensionScale and complexity of role—

Knowledge, skills andexperience—

Performance and contribution—

Market factors and affordability

Senior leaders have job pay ranges witha minimum and maximum; where an
individual is above the maximum of
their pay range owing to legacy orcommercial reasons then their pay
will not increase further.

Salaries are reviewed annually,
with increases taking effect from
1 August. A budget is agreed
and distributed according to theabove factors.
Pay ranges for senior leaders arereviewed annually and updated
as required.

Executive directors and some seniorleaders employed in the BBC’scommercial businesses are eligible
for a performance-related annual
bonus. Such bonuses are wholly
funded by the commercial
businesses and not the licence fee.
It is reward for the achievementof short-term strategic goals andprofit growth.

Executive directors and seniorleaders in the Public Service
are not entitled to receive a
performance bonus.

Pensions are offered in accordancewith the pension arrangements
offered to all BBC employees.

Executive directors and seniorleaders can elect to join the BBC’s
defined contribution scheme
LifePlan.

Current policy provides a defined
contribution scheme with no salary cap
and a maximum employer contributionof 10% of salary.

The BBC’s defined benefit scheme
is closed for new joiners.

Existing members of a defined benefit
pension scheme are capped at the
maximum salary for their pension
scheme or are subject to a cap in
pensionable salary growth.

In addition to pensions, life
assurance is provided in line witharrangements provided to all
BBC employees.

104—

BBC Group Annual Report and Accounts 2018/19

Payments of a bonus in the
BBC’s commercial businesses are
subject to the achievement of an
overall target based on a mix ofheadline profit and cash flow
for their business.

Executive directors are provided
with death in service life assurance
cover of four times their basic salary.

No executive director in the PublicService has received a bonus
since 2008.
For 2018/19, one executive director –CEO BBC Studios – participated in abonus scheme. The incentive scheme
has a target bonus of 40% and amaximum of 50%.

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G OV E R N A N C E

Component

Purpose and link to strategy

Operation

Maximum opportunity

Benefits– Car allowance

In April 2012, the BBC removed
the car allowance benefit for all
new executive directors toensure that future policy aligns
with arrangements for all
BBC employees.

David Jordan is in receipt of a legacy
car allowance; no other executive
director receives such an allowance.

There is no prescribed maximum as
this is an historic benefit which has
not been offered to new starters
since 2012.

Car allowance benefit for seniorleaders was removed in 2012 for
all new starters.

Benefits– Private
MedicalInsurance (PMI)In April 2011, the BBC removed
the private health care benefit for
all new executive directors andsenior managers and aligned
to arrangements for all
BBC employees.
Following consultation, it has been
agreed to remove the PMI benefit
for executive directors and seniorleaders from 1 April 2019.

Some senior leaders are also still inreceipt of a legacy car allowance.
The Director-General is entitled tothe use of a car and driver but has
no entitlement to a personal car
allowance or fuel allowance. The
Chairman is subject to the samearrangements.
Executive directors who elected
to take up funded private medical
insurance in 2018/19 were: Tim
Davie, Ken MacQuarrie, Gautam
Rangarajan, Charlotte Moore andFrancesca Unsworth. Executive
directors will receive a legacy
allowance in lieu of PMI from
1 April 2019.

The maximum level of cover offeredis family cover.
This is an historic benefit.

Employment
contracts andseverance

Employment contracts of executive
directors have a maximum notice
period of six months, but are subject
to earlier termination for cause.

There is no contractual entitlement
to any additional remuneration in
the event of early termination otherthan in the case of termination forreason of redundancy.

In the event of redundancy, all
executive directors are entitled to
payments equal to one month peryear served up to maximum paymentof £150,000.

Other
remuneration

There is no entitlement to any other
remuneration, so no such payments
were made in the year.

Should any additional remuneration
be proposed, full consideration is
given to the reputational risk to
the BBC and any such payment
would require the approval of theRemuneration Committee, prior
to implementing.

There is no prescribed maximum.

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PensionExecutive directors who joined the BBC before 1 December 2010 are eligible to continue to participate in the BBC Pension Scheme (‘theScheme’), which provides for pension benefits on a defined benefit basis. Executive directors who joined the BBC on or after 1 December
2010 are eligible to join LifePlan, which is the BBC’s defined contribution arrangement. The BBC pays matching contributions to LifePlan
for employee contributions between 4% and 5%. Employee contributions between 6% and 7% are matched plus an additional 1%.
Employee contributions of 8% or more receive the maximum employer contribution of 10%. There is no maximum pensionable salary forcontributions to LifePlan.
Executive directors who decide not to join LifePlan or are not already an existing member of the Scheme are, subject to meeting therelevant criteria, automatically enrolled into the National Employment Savings Trust (NEST). The BBC paid 2% and employees paid 3% ofqualifying earnings to NEST in 2018/19 in line with statutory requirements. Individuals can choose to opt out of this.
Executive directors’ pension arrangements may be reviewed and amended in response to changes in legislation or similar developments.
Features of the BBC’s pension arrangements that our executive directors participate in alongside other BBC employees are provided in
the table below.
Details of the BBC Pension Scheme are available at: bbc.co.uk/mypension/.

LifePlan defined
contribution

National Employment
Savings Trust (NEST)
defined contribution(auto enrolment
arrangement)

1 January
2012

Open toall eligible
employees

Open toall eligible
employees

1.67% accrual
Adjusted in linewith CPI

BBC will
contributea maximum of
10% of salary
if employee
contributes 8%
with lower sliding
scale

BBC will
contribute 2%of qualifying
earnings(2018/19)

BBC Pension Scheme defined benefit
Old benefits

New benefits

CAB 2006

CAB 2011

Date closed

30 September
1996

31 October
2006

30 November
2010

Accrual60ths accrual

60ths accrual

1.67% accrual
Adjusted in linewith inflation

SalaryFinalpensionable

Final
Career average
Career averagepensionable revalued earnings revalued earnings

SchemeNormalpensionable age
Earnings cap

Pensionablesalary growth
before theearnings cap isappliedEmployeecontribution(% of pensionablesalary)

106

60

60

65

65

N/A

N/A

Joined before
1 June 1989
uncapped,
capped otherwise
at £160,800

Capped at£160,800

Capped at£160,800

Capped at£150,600

Uncapped

Minimum
earnings £6,032
p.a. Maximum
earnings £46,350
p.a. (2018/19)

Limited at
1% p.a.

Limited at
1% p.a.

Limited at
1% p.a.

No restriction

N/A

N/A

7.50%

7.50%

4%

6%

Minimum
employeecontribution
is 4%

3% of
qualifying
earnings(2018/19)

BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

BBC Board Annual Remuneration Report
Annual remuneration of the BBC Board and Executive Committee – detail of remuneration received
The table below provides full details of the remuneration received by all BBC Board members for 2018/19. The Board was first
constituted on 3 April 2017 under the implementation of the 2016 Charter and Agreement, which set out new governance arrangements
for the BBC.
Steve Morrison was the Chair of the Remuneration Committee until 31 July 2018; Nicholas Serota assumed this role from 1 August 2018.
Details of the chairs of each of the various BBC committees can be found on page 98-99. Each Chair receives £5,000 per annum in
addition to their base fees. These fees are included in the table below. All fees are shown pro-rata where appropriate.
BBC Board
Details of remuneration received (values in £000s)
Appointment
term
start dateAppointment
term
end date

Year

Fees/
base pay

Taxablebenefits*

Pensionrelated single
figurePerformance
related

Total

Non-executive directors
David Clementi**

16/02/2017 16/02/2021

2018/192017/18

£100
£100

£13
£14

£0
£0

£0
£0

£113
£114

Simon Burke

03/04/2017 03/07/2019

2018/192017/18

£38
£37

£0
£0

£0
£0

£0
£0

£38
£37

Tanni Grey-Thompson

03/04/2017 02/04/2021

2018/192017/18

£33
£33

£0
£0

£0
£0

£0
£0

£33
£33

Ian Hargreaves

03/04/2017 02/04/2020

2018/192017/18

£38
£37

£0
£0

£0
£0

£0
£0

£38
£37

Tom Ilube

03/04/2017 02/04/2020

2018/192017/18

£38
£37

£0
£0

£0
£0

£0
£0

£38
£37

Steve Morrison***03/04/2017 02/04/2021

2018/192017/18

£40
£37

£0
£0

£0
£0

£0
£0

£40
£37

Nicholas Serota

03/04/2017 02/04/2021

2018/192017/18

£36
£33

£0
£0

£0
£0

£0
£0

£36
£33

Ashley Steel

03/04/2017 02/04/2020

2018/192017/18

£38
£33

£0
£0

£0
£0

£0
£0

£38
£33

Elan Closs Stephens

20/07/2017 19/07/2020

2018/192017/18

£38
£23

£0
£0

£0
£0

£0
£0

£38
£23

2018/192017/18

£399
£370

£13
£14

£0
£0

£0
£0

£412
£384

Total non-executive directors
Executive directors
Tony Hall**

03/04/2017

n/a****

2018/192017/18

£450
£450

£25
£30

£0
£0

£0
£0

£475
£480

Anne Bulford

03/04/2017 31/03/2019

2018/192017/18

£435
£435

£0
£0

£0
£0

£0
£0

£435
£435

Tim Davie*****

03/04/2017 02/04/2021

2018/192017/18

£400
£400

£2
£2

£40
£41

£200
£248

£642
£691

Ken MacQuarrie

03/04/2017 02/04/2021

2018/192017/18

£325
£250

£2
£2

£0
£0

£0
£0

£327
£252

Total executive directors

2018/192017/18£1,610£1,535

£29
£34

£40
£41

£200
£248

£1,879£1,858

Total Board

2018/192017/18£2,009£1,905

£42
£48

£40
£41

£200
£248

£2,291£2,242* 	** 	

Taxable benefits: car allowance, private medical insurance and other taxable expenses.
The Chairman and Director-General are entitled to a car and driver but have no entitlement to a personal car allowance or fuel allowance. During 2017/18 and 2018/19
access to these arrangements has also been made available to all other executive directors on a shared basis.
*** 	 Steve Morrison chaired both the Remuneration and Scottish Nations Committees during the year, receiving additional Chair fees in respect of both these positions.
**** 	 The role of Director-General is a permanent member of the Board.
***** 	 Tim Davie’s role as CEO, BBC Studios is funded entirely by the BBC’s commercial revenues and not paid for, or subsidised by, the licence fee. Payment of any bonus is subject tothe achievement of an overall headline profit and cash for that subsidiary, with targets approved by the Remuneration Committee. The performance-related remuneration
relates to the amount earned in the year.

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The table below provides full details of the remuneration received by all BBC Executive Committee members for 2018/19, compared tothe previous year. Remuneration for members shown below relates solely to the period of time when they served on the Executive
Committee. For full annual amounts, please refer to the Disclosures section on page 111.
Total Executive Committee remuneration for 2018/19 has risen since 2017/18, due to the increased membership of the Committee in theyear (15 members, compared to ten members in 2017/18).
BBC Executive Committee members
Details of remuneration received (values in £000s)
Date appointed
to Committee

Year

Base pay

Taxablebenefits

Pension related
single figure**

Performance
related

Total

Tony Hall

02/04/2013

2018/192017/18

£450
£450

£25
£30

£0
£0

£0
£0

£475
£480

Anne Bulford

21/06/2013

2018/192017/18

£435
£435

£0
£0

£0
£0

£0
£0

£435
£435

Tim Davie*

01/11/2012

2018/192017/18

£400
£400

£2
£2

£40
£41

£200
£248

£642
£691

Ken MacQuarrie

22/09/2016

2018/192017/18

£325
£250

£2
£2

£0
£0

£0
£0

£327
£252

Charlotte Moore

06/07/2016

2018/192017/18

£370
£333

£2
£2

£32
£36

£0
£0

£404
£371

Clare Sumner***

01/04/2018

2018/192017/18

£170
–

£0
–

£17
–

£0
–

£187
–

David Jordan***

01/04/2018

2018/192017/18

£171
–

£8
–

£0
–

£0
–

£179
–

Francesca Unsworth

01/01/2018

2018/192017/18

£340
£85

£2
£0

£0
£0

£0
£0

£342
£85

Gautam Rangarajan***

01/06/2018

2018/192017/18

£146
–

£1
–

£26
–

£0
–

£173
–

Glyn Isherwood***

09/04/2018

2018/192017/18

£318
–

£0
–

£0
–

£0
–

£318
–

James Purnell

19/03/2013

2018/192017/18

£315
£295

£0
£0

£3
£25

£0
£0

£318
£320

John Shield***

01/04/2018

2018/192017/18

£218
–

£0
–

£1
–

£0
–

£219
–

Kerris Bright***

18/06/2018

2018/192017/18

£283
–

£0
–

£0
–

£0
–

£283
–

Matthew Postgate

01/04/2016

2018/192017/18

£310
£310

£0
£0

£31
£34

£0
£0

£341
£344

Valerie Hughes-D’Aeth

01/08/2014

2018/192017/18

£310
£310

£0
£0

£0
£0

£0
£0

£310
£310

Remuneration relating to former
Executive Committee members****Total Executive Committee* 	***** 	****

108

2017/18

£623

£2

£76

£136

£837

2018/192017/18£4,561£3,491

£42
£38

£150
£212

£220
£384

£4,953£4,125

Tim Davie’s role as CEO, BBC Studios is funded entirely by the BBC’s commercial revenues and not paid for, or subsidised by, the licence fee. Payment of any bonus is subject tothe achievement of an overall headline profit and cash for that subsidiary, with targets approved by the Remuneration Committee.
Employee pension contributions are ordinarily made via a salary sacrifice arrangement as an employer contribution, with a corresponding reduction in salary. Base salaries for
executive directors have not been adjusted to reflect the impact of salary sacrifice to enable like-for-like comparison with prior years before salary sacrifice was introduced.
The pension-related single figure is generally calculated at 20 times the increase in the accrued pension over the year net of inflation, less the directors’ defined benefit
contributions, plus the employer’s defined contributions. This is also shown in detail in the defined benefits pension prospective entitlements table.
John Shield, Clare Sumner and David Jordan joined the Executive Committee on 1 April 2018, and Gautam Rangarajan joined the Executive Committee on 1 June 2018.
Therefore no figures are reported for the 2017/18 period; Glyn Isherwood and Kerris Bright were appointed to the BBC in April and June 2018 respectively and therefore
received no remuneration in 2017/18.
Remuneration relates to Mark Linsey and James Harding, who stepped down from the Executive Committee during 2017/18.

BBC Group Annual Report and Accounts 2018/19

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Total remuneration – Board and Executive Committee
There has been an increase in the overall total annual remuneration for the Board and Executive Committee in 2018/19, predominantly
as a result of the increase in membership of the Executive Committee in 2018/19 to 15 members (previously ten in 2017/18).
Total remuneration (values in £000s)

2018/192017/18

Total Executive Committee (including Board executive directors)
Board non-executive directors£4,953£412£4,125£384

Total annual remuneration£5,365£4,509Defined benefit pension prospective entitlements (values in £000s)

Age at31 March 2019

SectionAccrued pension
31 March 2019(or retirement/leaving theBoard if earlier)

51
50
44
61
47

CAB 2011
New benefits
New benefits
Old benefits
CAB 2011

18
31
35
117
17

Tim Davie
Charlotte Moore
Matthew Postgate
Francesca Unsworth
Gautam Rangarajan

Accrued pension
1 April 2018
(or joining theBoard if after)

Director DB
contributions(via salarysacrifice)2018/19

Pension-related
single figure

15
28
32
114
15

9
11
11
9
8

40
32
31
0
26

Notes:Tim Davie is an active member of the CAB 2011 section from January 2012 and retains a deferred benefit in the new benefits section for service up to that date. The accrued pension
shown relates to CAB 2011 only.
Charlotte Moore joined the BBC on 1 May 2006. The pension figures shown include the period before she was appointed as an executive director.
Matthew Postgate joined the BBC on 1 June 2005. The pension figures shown include the period before he was appointed as an executive director.
Francesca Unsworth joined the BBC in 1983. The pension figures shown include the period before she was appointed as an executive director.
Gautam Rangarajan joined the BBC in 1993 and was appointed as an executive director on 1 June 2018. The pension figures shown include the period before he was appointed as an
executive director. He is an active member of the CAB 2011 section from January 2012 and retains a deferred pension in the old benefits section for service up to that date. The
accrued pension shown relates to CAB 2011 only.

Comparative pay across the BBC
In 2011 the BBC voluntarily agreed to report the top to median public service earnings multiple as proposed in the Hutton report‘Fair Pay in the Public Sector’. Since 2011 the BBC has published these figures on an annual basis.
The table below provides a summary of the Director-General to BBC staff median earnings and executive directors to median earnings
figures since 2011. The sample group for the executive directors group has changed since 2017/18 following the expansion of the
Executive Committee membership in 2018/19.
The Public Service staff median has changed from 10.7 to 10.2 in 2018/19.

Director-General earnings
Executive directors’ median earnings

2019

2018

2017

2016

2015

2014

2013

2012

2011

10.2
7.0

10.7
7.7

10.2
7.7

10.4
8.19

10.7
8.2

10.9
8.2

11
8.1

16.5
8.7

16.8
8.9

Notes:
Earnings calculation includes: basic pay, bonus, continuing allowances, overtime and other non-continuing allowances. Median earnings figures are calculated using
Director-General and executive directors’ annual salaries.
These figures exclude roles which are funded entirely by the BBC’s commercial operations, such as the CEO, BBC Studios.

The table below provides a summary of the changes to the Director-General’s cash earnings for 2018/19 versus the change in pan-BBC
median earnings over the same period. There have been no changes to the Director-General’s remuneration in 2018/19.

Director-General earnings
Pan-BBC median earnings

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2018/19(values in £0 0 0s)

Change from2017/18

£450
£44

0%
5%

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Severance
No severance was paid to executive directors during the year ended 31 March 2019.
Outside interests
With the prior agreement of the Director-General, executive members of the BBC Board may hold remunerated external directorships.
The prime purpose of the external directorship should be to support personal and career development and thereby give back to the BBC.
Remuneration which arises from external directorships may be retained by the individual, but is subject to formal approval. Executive
directors may also hold non-remunerated posts outside the BBC. No more than one to two days per month are permitted to fulfil all
external duties.
During the year, one executive director held another remunerated external directorship, where fees were waived.
The BBC’s commercial businesses
During 2018/19, the BBC had staff employed with three main commercial subsidiaries:—

BBC Studios—

BBC Studioworks—

BBC Global News

Remuneration within the commercial subsidiaries is subject to the BBC’s governance and approval processes. The remuneration policy
for the subsidiaries includes the contractual provision of an annual bonus available to eligible staff, including directors, and it varies
between commercial entities. The full cost of base pay and annual bonus are self-funded by the commercial revenues of each subsidiarycompany and are not subsidised by the licence fee.
BBC Studios Company Bonus Scheme
The Remuneration Committee has oversight of the design and outturn of the BBC Studios Company Bonus Scheme. The 2018/19 scheme
was built on two key measures:—

EBITDA, weighted 66.6%; and—free cash flow, weighted at 33.3%.

Targets are set to ensure the achievement of the long-term business strategy for BBC Studios, and for 2018/19 incorporated 5% growthat target, and 10% growth at maximum.
All figures below in £ millions.

EBITDAFree cash flow

ThresholdTargetMaximum

£144
£110

£151
£116

£158
£127

Participation is limited to senior roles in key commercial areas, with threshold, target and maximum individual percentages set by grade.
For the CEO, BBC Studios, the achievement of the targets above results in the following individual payments, subject to Remuneration
Committee discretion and approval:

Bonus as % of salaryThresholdTargetMaximum

16%

40%

50%

2018/19 results
For 2018/19, the Remuneration Committee assessed the outturn of the BBC Studios bonus as above as BBC Studios exceeded thetargets for both EBITDA and free cash flow in 2018/19. This resulted in a bonus payment of 50% (£200,000) to the CEO, BBC Studios
in respect of the year’s performance.

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Pay disclosures
Projected 55:45 male:
female split of on-air
talent in 2019/20
2018/19 – delivering on our commitments
Last year we published our second
disclosure list, showing all those paid over
£150,000 from licence fee funds within
the year, as required by our Charter. In
doing so, we provided more transparency
on pay levels – using £10,000 bands
instead of £50,000 and providing a
breakdown of overall work conducted
for each individual – and also set out asnapshot of how we expected the list tochange over the course of 2018/19. This
included ambitious targets to improvefurther the mix and balance of our highest
paid on-air talent in the public service.
This year we publish our third list
which shows we have made strong
progress against those ambitions:—

we have met all the targets we forecast
for ourselves last year, with our genderbalance now showing a 60:40 male/
female split over the year, compared to
76:24 in 2016/17, and with BAME levels
on the list up at 20%;—

we are providing yet moretransparency overall with a move to£5,000 bands, as recommended by Will
Hutton in his transparency review; and—our snapshot for where we stand
today shows that we will make further
significant progress in what we reportat the end of 2019/20, with a projected
gender split of 55:45 as of June 2019.

20% BAME
representationachieved on-air

Reduction in
numbers of men
earning over £500k

2018/19 results
In the following pages, we set out
details of those individuals who received
more than £150,000 from licence feerevenue. The Charter requirement is
simply to publish amounts paid during
the year, for these individuals, set out
in bands. We are going beyond that
requirement by publishing more detailof the work that on-air individuals didfor the remuneration they received.
It is worth noting that, both on-air and off,
we are operating in extremely competitivemarkets, as some recent high-profile
departures have shown. This is particularly
the case in some of the media markets
in which we compete for creative andproduction-related talent, where pay
inflation sits well above the UK medianof 3%. This pressure, taken with the fixed£150,000 entry point to the list, suggeststhat more individuals will appear onthese lists over time. Were the thresholdfor inclusion to be linked to inflation, we
would expect the numbers on the list to
be broadly flat over time. Nevertheless,as in previous years, we will continue tomonitor and aim to reduce our total seniorleader and on-air paybill as a whole.

Priorities for next year
Over the coming year, we will continue tofocus on improving the balance in theselists – our snapshot shows that we aim to be
at a 55:45 male/female split across 2019/20
for on-air roles and we will continue topush this toward an even distribution.
We will also maintain our aim for BAME
talent to make up at least 20% of the list.
In projecting pay for 2019/20, we aremaking some assumptions about thepattern of work throughout the next ninemonths. We have relied on contractual
commitments, pay data from June 2019
and any publicly known changes toprogrammes, roles and schedules. Given
the provisional nature of this snapshot
data, this table has not been audited by the
National Audit Office but has been subject
to internal audit assurance procedures.

The data shows how far the BBC hascome in improving female representation
among our highest paid on-air stars – ahuge transformation from the 76:24 split
when we first published the data twoyears ago for 2016/17. Put together with
our further significant reduction in thegender pay gap this year (see: bbc.com/
aboutthebbc/reports/reports for moredetails) and our ground-breaking 50:50
project which is changing the look andfeel of our coverage at all levels – not justthe highest paid few – these changes tella very clear story of a BBC committed tofair pay and taking action ahead of most in
the media industry and the UK as a whole.

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Report from the BBC Remuneration Committee of people paid more than £150,000 of licence fee revenue in the financial year
Under the terms of our Charter, we are required to publish the names of individuals working for the BBC, paid more than £150,000 fromlicence fee revenue in the financial year, set out in pay bands. These are shown by category: News, Radio, Sport, and presenters who work
regularly across multiple parts of the BBC including Television. These figures also include payments from licence fee revenue made to
individuals working under a contract for services. These figures exclude any recharges, amounts paid, and investments into programmes
made by our commercial entities – for example BBC Studios. Payments made by independent producers, royalties, repeat fees,
contractual and other recoverables and expenses are also excluded. Programme commitments have been drawn from contractual
commitments or other patterns of work, and have been stated to the nearest 10. These have been consistently disclosed for eachprincipal programme or genre. Single episodes have been excluded, unless this represents a significant part of an individual’s work.
Summary of on-air talent paid more than £150,000 from licence fee revenue, including 2019/20 snapshot
2017/18

2018/19

Number%Number2019/20 Snapshot%

NumberMen£150,000 – £199,999£200,000 – £299,999£300,000 – £399,999£400,000 – £499,999£500,000+

16
11
3
7
5

16
16
7
3
3

15
15
5
4
2

Women
£150,000 – £199,999£200,000 – £299,999£300,000 – £399,999£400,000 – £499,999£500,000+

12
8
2
–
–

13
13
4
–
–

15
12
3
2
1

TotalsTotal Men

42

66%

45

60%

41

%

55%

Total Women

22

34%

30

40%

33

45%

Total

64

100%

75

100%

74

100%

Of which BAME

10

16%

15

20%

14

19%

Detailed on-air talent pay tables
Principal programme

Name

Programme commitments

Pay

Nick Robinsonc.140 programmesc.55 episodes of Political Thinking
1 episode of Panorama and NHS at 70
News Specials£290,000 - £294,999

John Humphrysc.140 programmes

Mishal Husainc.100 programmes
c.40 days for BBC News bulletins
12 episodes of From Our Home Correspondent£255,000 – £259,999

Martha Kearneyc.140 programmes£245,000 – £249,999

News and Current Affairs
Today

Justin Webb

c.150 programmes

World at One

Sarah Montague

c.140 programmes
c.10 episodes of HARDtalk£240,000 – £244,999

PM

Evan Davisc.70 programmes
c.60 days for Newsnight
The Bottom Line on Radio 4£275,000 – £279,999

Eddie Mairc.70 programmes£155,000 – £159,999

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Principal programme

Name

Programme commitments

Pay

BBC News at Six and
BBC News at Ten

Huw Edwardsc.180 presentation days for BBC One & News Channel
Elections and News Specials£490,000 – £494,999

George Alagiahc.180 presentation days for BBC One£315,000 – £319,999

Sophie Raworthc.150 presentation days for BBC One£265,000 – £269,999

Question Time

Fiona Brucec.100 presentation days for BBC One
c.10 episodes of Question Time

£255,000 – £259,999

The Andrew Marr Show

Andrew Marrc.40 programmes
c.20 editions of Start the Week
BBC Documentaries£390,000 – £394,999

Newsnight

Emily Maitlisc.120 days for Newsnight£260,000 – £264,999

Victoria Derbyshire

Victoria Derbyshire

Lead presenter on Victoria Derbyshire£215,000 – £219,999

BBC News Channel

Clive Myrie

BBC News Channel, BBC One bulletins and location work

£200,000 – £204,999

Reeta Chakrabarti

BBC News Channel, BBC One bulletins and location work

£170,000 – £174,999

Ben Brown

BBC News Channel, BBC One bulletins and location work

£165,000 – £169,999

Jane Hill

BBC News Channel, BBC One bulletins and location work

£155,000 – £159,999

Joanna Gosling

BBC News Channel and BBC One bulletins
Cover for Victoria Derbyshire£150,000 – £154,999

BBC Radio News

Tina Daheley

Radio 2 Breakfast Show, Newsbeat and Beyond Today
BBC One bulletin and BBC Breakfast coverc.40 episodes of The Cultural Frontline
1 episode of Panorama
Cover for Woman’s Hour

£185,000 – £189,999

BBC Breakfast

Louise Minchinc.180 programmes
Triathlon: World Series£205,000 – £209,999

Naga Munchettyc.180 programmes£190,000 – £194,999

Charlie Stayt

c.180 programmes

Laura Kuenssberg

Political Editor£250,000 – £254,999

Jon Sopel

North America Editor£240,000 – £244,999

Jeremy Bowen

Middle East Editor£215,000 – £219,999

Amol Rajan

Media Editor
c.40 episodes of The Media Show; c.10 episodesof Start the Week and cover on BBC Radio 2
BBC Television and Radio Documentaries£210,000 – £214,999

Katya Adler

Europe Editor£205,000 – £209,999

Fergal Keane

Africa Editor£195,000 – £199,999

Mark Easton

Home Editor£180,000 – £184,999

James Naughtie

Presenter and Correspondent£170,000 – £174,999

Simon Jack

Business Editor

On-air editors andcorrespondents

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John Pienaar

Deputy Political Editor and Pienaar’s Politics

Sarah Smith

Scotland Editor and Sunday Politics

Orla Guerin

International Correspondent£160,000 – £164,999

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Principal programme

Name

Programme commitments

Pay

Nick Grimshaw

c.80 editions of Radio 1 Breakfast Showc.110 editions of Radio 1 Drivetime Show
Biggest Weekend and festival coverage£310,000 – £314,999

Scott Millsc.210 editions of The Scott Mills ShowRadio 1 Breakfast Show cover
Biggest Weekend and festival coverage
Eurovision Song Contest£285,000 – £289,999

Greg Jamesc.120 editions of Radio 1 Breakfast Showc.60 editions of Radio 1 Drivetime ShowRadio 1 Teen Awards
Biggest Weekend and festival coverage£225,000 – £229,999

Annie Macc.220 editions of The Annie Mac Show
Biggest Weekend and festival coverage£180,000 – £184,999

Clara Amfo

c.190 editions of Radio 1 Mid Morning Show

£150,000 – £154,999

Radio
BBC Radio 1

BBC Radio 2

BBC Radio 5 live

114

Chris Evansc.150 editions of The Chris Evans Breakfast Show

£1,250,000 – £1,254,999

Steve Wrightc.220 editions of Steve Wright in the Afternoon
c.50 editions of Sunday Love Songs£465,000 – £469,999

Zoe Ballc.30 editions of The Zoe Ball Breakfast Showc.40 editions of Radio 2 Saturday Afternoon Show

£370,000 – £374,999

Jeremy Vine

Daily show on Radio 2£290,000 – £294,999

Ken Bruce

c.220 editions of Radio 2 Mid Morning Showc.10 editions of Friday Night is Music Night
Eurovision Song Contest£280,000 – £284,999

Jo Whileyc.150 editions of Radio 2 Drivetime Showc.50 editions of Radio 2 Evening Show

£270,000 – £274,999

Simon Mayoc.150 editions of Radio 2 Drivetime Showc.40 editions of Kermode and Mayo on 5 live

£245,000 – £249,999

Sara Coxc.100 editions of Radio 2 Late Night Showc.50 editions of Radio 2 Teatime ShowRadio 2 Breakfast coverc.10 editions of Sounds of the 80s£235,000 – £239,999

Trevor Nelsonc.80 editions of Rhythm Nationc.80 Weekend Shows on 1Xtra£165,000 – £169,999

Nicky Campbell

c.200 editions of 5 live Breakfast Showc.200 editions of Your Call

£340,000 – £345,999

Adrian Chilesc.40 editions of Chiles on Friday
c.40 editions of Question Time Extra Timec.20 other shows on 5 live and Radio 4
1 episode of Panorama
Christine and Adrian’s Friendship Test

£180,000 – £184,999

Nihal Arthanayakec.190 editions of 5 live Early Afternoon Showc.40 editions of The Big Debate on Asian Network
Radio 6 Music cover£175,000 – £179,999

Rachel Burdenc.230 editions of 5 live Breakfast Show
Cover for BBC Breakfast & Your Call

£170,000 – £174,999

Dotun Adebayoc.160 editions of Up All Nightc.190 editions of the Late Night Show on Radio London
c.50 editions of Dotun on Sunday on Radio London£150,000 – £154,999

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Principal programme

Name

Programme commitments

Pay

BBC 6 Music

Lauren Lavernec.140 editions of 6 Music Mid Morning Showc.60 editions of 6 Music Breakfast Showc.40 editions of Recommends
c.30 editions of Desert Island Discs on Radio 4£305,000 – £309,999

Shaun Keavenyc.160 editions of 6 Music Breakfast Showc.50 editions of 6 Music Afternoon Show

£160,000 – £164,999

Vanessa Feltz

c.200 editions of Radio 2 Early Breakfast Showc.220 editions of Radio London Breakfast ShowRadio 2 cover£355,000 – £359,999

Stephen Nolanc.210 editions of The Nolan Show on Radio Ulsterc.10 editions of Nolan Live on BBC 1 (NI)c.120 editions of 5 live Late Night Shows£325,000 – £329,999

Mark Radcliffec.200 editions of Radcliffe and Maconiec.50 editions of the Folk Show

£155,000 – £159,999

Gary Lineker

Match of the Day: Premier League and FA Cup
Sports Personality of the Year
FIFA World Cup£1,750,000 – £1,754,999

Alan Shearer

Match of the Day: Premier League and FA Cup
FIFA World Cup£440,000 – £444,999

Jermaine Jenas

Match of the Day: Premier League and FA Cup
FIFA World Cup£210,000 – £214,999

Ian WrightMatch of the Day: Premier League and FA Cup
5 live Sport£205,000 – £209,999

CricketJonathan Agnew

International test, one-day and Twenty20 series
BBC Cricket Correspondent£170,000 – £174,999

TennisSue Barker

Wimbledon, Queen’s, ATP World Tour Finals
Australian OpenSports Personality of the Year

£195,000 – £199,999

John McEnroe

Wimbledon£190,000 – £194,999

Gabby Logan

Athletics
Premier League Show, FIFA World Cup and other football
Rugby Autumn Internationals and Six Nations
Commonwealth Games
European Sports Championships
Sports Personality of the Year

£290,000 – £294,999

Mark Chapman

Twice weekly editions of 5 live sport
Weekly Premier League highlights and MOTD 2 Extra
Rugby League
FIFA World Cup
NFL£230,000 – £234,999

Clare Balding

Commonwealth Games
Wimbledon
European Sports Championships
EquestrianSports Personality of the Year

£175,000 – £179,999

Multiple stations

Sport
Men’s footballMultiple sports

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Multiple genres and Television
There are a small number of individuals who have pre-existing multi-year relationships with BBC commissioning. Payments from BBC
Studios have been removed from the disclosure, and they may also receive payments from independent producers. We also include in thissection presenters who spend close to 50% of their time in more than one of TV, Radio, News and Sport.
Principal programme

Name

Programme commitments

Pay

Television

Mary Berry

BBC TV fee for a range of programmes and series£195,000 – £199,999

Radio and Sport

Jason Mohammad

Daily Radio Wales programme
Weekly 5 live programmes
Final Score, FIFA World Cup and other football
Snooker
Commonwealth Games
Good Morning Sunday on Radio 2£355,000 – £359,999

News and SportDan Walker

Football Focus and FIFA World Cup
BBC Breakfast£280,000 – £284,999

Radio and Television

Graham Norton

Weekly show and special features on Radio 2
BBC TV fee for a range of programmes and series£610,000 – £614,999

Claudia Winkleman

Weekly show on Radio 2
BBC TV fee for a range of programmes and series£370,000 – £374,999

Senior executives
We already publish on our website the pay and expenses for all senior leaders earning over £150,000 in the BBC’s public services. Under
the terms of our Charter, we are required to publish a report from the Remuneration Committee listing all senior executives of the BBC
paid more than £150,000 from licence fee revenue in the financial year, set out in pay bands. These figures exclude any recharges oramounts paid from our commercial entities.
Pay

Name

Role

Tony Hall

Director-General£370,000 – £374,999

Charlotte Moore

Director, Content£340,000 – £344,999

Francesca Unsworth

Director, News and Current Affairs£325,000 – £329,999

Ken MacQuarrie

Director, Nations and Regions£315,000 – £319,999

Glyn Isherwood

Chief Financial Officer£310,000 – £314,999

Valerie Hughes-D’Aeth

Chief HR Officer

Director-General£450,000 – £454,999
Executive Committee

Matthew Postgate

Chief Technology and Product Officer£305,000 – £309,999

James Purnell

Director, Radio and Education£280,000 – £284,999

Kerris BrightChief Customer Officer£275,000 – £279,999

Bob Shennan

Group Managing Director£270,000 – £274,999

Sarah JonesGroup Legal Counsel£225,000 – £229,999

John Shield

Director, Communications and Corporate Affairs£175,000 – £179,999

David Jordan

Director, Editorial Policy and Standards£170,000 – £174,999

Clare Sumner

Director, Policy

Gautam Rangarajan

Director, Strategy£325,000 – £329,999

Bal Samra

Group Commercial Director£210,000 – £214,999

Shirley CameronGroup Financial Controller£205,000 – £209,999

Dale Haddon

HR Director

Balram Veliath

Director, Quality, Risk and Assurance£200,000 – £204,999

Gillian Taylor

Director, Reward£195,000 – £199,999

Anna Gronmark

HR Director, News and Current Affairs

Corporate Functions

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Pay

Name

Role

£190,000 – £194,999

Joe Godwin

Director, AcademyPeter Ranyard

Director, Corporate Legal£175,000 – £179,999

Noel Scotford

Director, HR Systems and Business Analytics£170,000 – £174,999

Rachel Currie

HR Director, Content, Radio and Education

Claudia Giles

Legal Director

Chris Rowsell

Head of Regulation

Phil Harrold

Company Secretary

Wendy Aslett

HR Director, Nations and Regions

Claire Paul

Senior Head of Leadership and Development

Sarah Gregory

Director, HR Operations

Catherine Hearn

Director, Resourcing

Isabel Begg

Head of Commercial Rights and Business Affairs

Tim Cavanagh

Director, Workplace

Alexis Hawkes

Legal Director

Pipa Doubtfire

Director, Revenue Management

Alan Bainbridge

Director, Corporate Real Estate

Jessica Cecil

Director£210,000 – £214,999

Matt Grest

Director, Platform£200,000 – £204,999

Stuart Page

Director, Product and Systems£165,000 – £169,999£160,000 – £164,999£155,000 – £159,999£150,000 – £154,999
Design and Engineering

Robin Pembrooke

Director, Product and Systems£190,000 – £194,999

Chris Condron

Director, Product and Systems£185,000 – £189,999

Kieran Clifton

Director, Distribution and Business Development

Jatin Aythora

Chief Architect

Andy Baker

Director, Engineering Operations

Andy Conroy

Controller, Research and Development£180,000 – £184,999

Gary Payne

Chief Information Security Officer£165,000 – £169,999

Sarah Hayes

Director, BBC Archives£160,000 – £164,999

Richard Cooper

Controller, Digital Distribution

Andrew Kaczor

Finance and Operations Director

Mike Ford

Programme Director£155,000 – £159,999

Claire Hetherington

Head of Product£150,000 – £154,999

John Parrott

Head of Architecture

Nick North

Director, Audiences

Justin Bairamian

Director, BBC Creative£240,000 – £244,999

Ian Haythornthwaite

Chief Financial and Operating Officer£180,000 – £184,999

Donalda MacKinnon

Director, Scotland

Rhodri Talfan Davies

Director, Wales£175,000 – £179,999

Peter Johnston

Director, Northern Ireland£150,000 – £154,999

Chris Burns

Senior Head of Local Radio Commissioning

Steve Carson

Senior Head of Multi-Platform Commissioning

Marketing and Audiences£170,000 – £174,999
Nations and Regions

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Pay

Name

Role

£245,000 – £249,999

Piers Wenger

Controller, Drama Commissioning£215,000 – £219,999

Dan McGolpin

Controller, iPlayer and Programming

Alison Kirkham

Controller, Factual Commissioning

Barbara Slater

Director, Sport

Shane Allen

Controller, Comedy Commissioning

Patrick Holland

Controller, BBC Two and BBC Four

£210,000 – £214,999

Kate Phillips

Controller, Entertainment Commissioning£205,000 – £209,999

Rose Garnett

Director, BBC Films£175,000 – £179,999

Lucy Richer

Senior Commissioning Editor, Drama

Tom McDonald

Head of Specialist Factual Commissioning

Cassian Harrison

Channel Editor, BBC Four

Philip Bernie

Head of TV Sport£165,000 – £169,999

Fiona Campbell

Controller, BBC Three£160,000 – £164,999

David Brindley

Head of Popular Factual Commissioning£155,000 – £159,999

Clare Sillery

Head of Documentary Factual Commissioning£150,000 – £154,999

Jo Wallace

Senior Commissioning Editor, Entertainment£205,000 – £209,999

Kamal Ahmed

Editorial Director£195,000 – £199,999

Jamie Angus

Director, World Service Group

Content£170,000 – £174,999

News and Current Affairs

Alan Dickson

Chief Financial and Operating Officer£175,000 – £179,999

Jonathan Munro

Head of Newsgathering£170,000 – £174,999

Mary Hockaday

Controller, World Service English

Gavin Allen

Head of News Programmes£165,000 – £169,999

Sarah Ward-Lilley

Managing Editor£155,000 – £159,999

Joanna Carr

Head of Current Affairs

James Gray

Deputy Head of Current Affairs

Jon Zilkha

Senior Project Director

Graham Ellis

Controller, Radio Production£150,000 – £154,999
Radio and Education£210,000 – £214,999

Alice Webb

Director, Children’s£200,000 – £204,999

Ben Cooper

Controller, Radio 1, 1Xtra and Asian Network£195,000 – £199,999

Gwyneth Williams

Controller, Radio 4£185,000 – £189,999

Charlotte Lock

Launch Director, Sounds£180,000 – £184,999

Cheryl Taylor

Head of Content, Children’s£175,000 – £179,999

Alan DaveyController, Radio Three£170,000 – £174,999

Helen Bullough

Head of Children’s Production£165,000 – £169,999

Jonathan WallController, 5 Live

£160,000 – £164,999

Rhona Burns

Finance and Operations Director

118

BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

Pay

Name

Role

£435,000 – £439,999

Anne Bulford

Deputy Director-General£200,000 – £204,999

Richard Dawkins

Chief Financial and Operating Officer

Former Staff

Neelay Patel

Director, Product and Systems£190,000 – £194,999

Damian Kavanagh

Controller, BBC Three£170,000 – £174,999

Elizabeth Kilgarriff

Senior Commissioning Editor (Drama)£160,000 – £164,999

Mark Friend

Controller, Editorial Projects£150,000 – £154,999

Colin Burns

Chief Design Officer

Adrian Van Klaveren

Head of Strategic Change and Portfolio Management

Tunde Ogungbesan

Head of Diversity and Inclusion

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BBC Group Annual Report and Accounts 2018/19

119

PAY D I S C L O S U R E S

NAO opinion on pay disclosures
Independent Assurance Report to
the Board of the British Broadcasting
Corporation, acknowledging that
Parliament also places reliance on
the Group Accounts and Report
I have conducted independent assurance
procedures on the disclosures includedin the British Broadcasting Corporation(BBC) Annual Report arising from therequirement under the Royal Charter forthe continuance of the BBC (the Royal
Charter) to publish the names of all senior
executives of the BBC paid more than£150,000 from licence fee revenue in that
financial year; and the names of all otherstaff of the BBC paid more than £150,000
from licence fee revenue in that financial
year set out in pay bands for the year-ended
31 March 2019. These disclosures comprise
the Pay Disclosures as set out on pages
112 to 119 of the BBC’s Annual Report (thesubject matter) (the “Pay Disclosures”).
My work is conducted in accordance with
International Standards on Assurance
Engagements (ISAE) 3000 Assurance
Engagements Other Than Audits or
Reviews of Historic Financial Information.
Respective responsibilities of the
BBC Board and the Comptroller and
Auditor General
For the reporting year covered by thisreport, the BBC Board was responsible
for publishing information requiredby the Royal Charter as follows:—

the names of all senior executives of
the BBC paid more than £150,000 fromlicence fee revenue in that financial
year; and—the names of all other staff of the BBC
paid more than £150,000 from licencefee revenue in that financial year set
out in pay bands for the year-ended
31 March 2019.

I am responsible for providing an opinion
on whether, in all material respects, thesubject matter is complete and accurate
and has been properly prepared inaccordance with the basis set out therein.

120

In conducting this work, my staff andI have complied with the Financial
Reporting Council’s Revised EthicalStandard 2016. I am independent of
the BBC in accordance with the ethicalrequirements that are relevant to myprocedures. My staff and I have fulfilled
our other ethical responsibilities inaccordance with these requirements.
My approach
I have performed a reasonable assurance
engagement as defined in ISAE 3000.
A reasonable assurance engagement isto perform such procedures as to obtain
information and explanations which
I consider necessary to express an opinion
on whether, in all material respects, thePay Disclosures (the subject matter)are complete and accurate and havebeen properly prepared in accordancewith the basis set out therein.

Inherent limitations
My assurance procedures have been
designed to provide reasonable assurance.
The objective of a reasonable assurance
engagement is to reduce engagement
risk to an acceptably low level in thecircumstances of the engagement as thebasis for a positive form of expression of myconclusion. It does not, however, eliminate
this risk entirely. In particular, in preparing
the disclosures, the BBC Board is required
to make a number of judgements which
inherently introduces an element of risk.
OpinionBased on the results of my procedures,in my opinion, in all material respects
the Pay Disclosures included on pages
112 to 119 are complete and accurate
and have been properly prepared inaccordance with the basis set out therein.

My work consisted of:—Understanding the process adopted by
the BBC to derive the Pay Disclosures,in particular the completeness andaccuracy of information used;—

Testing the completeness of
disclosures, including:—cross-reference to my BBC Groupaudit procedures relating topayroll and expenditure;—comparison to the prior year andmy understanding of the BBC; and—review of individuals paid in thesubsequent month who have been
paid close to the disclosure
threshold in 2018-19.

—

Agreement of staff disclosure to
payroll data or, where staff are not paid
via BBC payroll, agreement of spendback to other BBC systems;—

Agreement of the spend per individual
paid more than £150,000 of Licence
Fee revenue into the appropriatesalary banding;—

Recalculation of the volume ofindividuals included within each £5,000
band; and—

Review of the accompanying
commentary for reasonableness andclarity around the basis of disclosure.

BBC Group Annual Report and Accounts 2018/19

Gareth Davies
Comptroller & Auditor General
National Audit Office157-197 Buckingham Palace Road
London SW1W 9SP
21 June 2019

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G OV E R N A N C E

Nominations Committee Report
The Board Nominations Committee
is responsible for appointments to
the Board (with the exception of the
Chairman and the nations’ members)
and Board committees.
The Nominations Committee consists of:
the Chairman, Sir David Clementi; Simon
Burke, the Senior Independent Director;
the Director-General, Tony Hall and nonexecutive directors Sir Nicholas Serota andAshley Steel. An additional non-executive
director, Elan Closs Stephens, has been
appointed to the Committee, with her termof appointment to start on 1 April 2019.
In addition to its responsibility fornominating appointments to the Board,
the Committee is also responsible
for nominating members to the subcommittees of the Board, and its maincommercial subsidiaries. The Nominations
Committee also considers and reviews
the independence of Board members,
including any conflicts of interest, andensures compliance with the Board Codeof Practice. It assesses the composition of
the Board and its associated committees
in terms of the balance of skills andexperience required, and to develop
a succession planning strategy.

for the departure of Simon Burke, theSenior Independent Director to theBoard, and Chairman of the Board’s Audit
Committee. This has been a significant
undertaking given the extensive role Simonhas played. The Board has now appointed
Shirley Garrood to take over the Chair of
the Audit Committee, and Sir Nicholas
Serota to assume the position of Senior
Independent Director as of 3 July 2019.

This year the Nominations Committee
has met five times. It has appointed two
new members to the Board. Francesca
Unsworth, Director, News and Current
Affairs, replaced Anne Bulford as an
executive member of the Board from
1 April 2019 and Shirley Garrood was
appointed as a non-executive directorof the Board, with her term to startin July 2019. The Committee has also
made a number of appointments to subcommittees of the Board. In addition,
the Committee has also considered thegovernance and membership of theBBC’s Commercial Holdings Board.

This year the Nominations Committee also
conducted an exercise to ensure that theBBC’s governance structure was alignedwith the requirements of the most recent
Corporate Governance Code publishedin July 2018. As a result of that work, theNominations Committee is now responsible
for evaluating the performance of theBoard and its associated sub-committees.

A large part of the work of the Committee
this year has been in succession planning

Sir David Clementi
Chairman
20 June 2019

Board committee attendance
Board

Number of meetings
for the period

Audit and Risk Fair Trading
Committee
Committee

Editorial
Nominations Remuneration Guidelines &Committee
Committee
Standards

Nations
Committee– England

Nations
Committee– Scotland

Nations
Committee– WalesNations
Committee– N. Ireland

Ordinary

MemberMemberMemberMemberMemberMemberMemberMemberMember

11

5

3

5

5

5

4

3

3

2

Non-executives
David Clementi

11

Simon Burke

10

Tanni Grey-Thompson

10

Ian Hargreaves

11

Tom Ilube

11

Steve Morrison

11

Nicholas Serota

11

Ashley Steel

11

Elan Closs Stephens

11

5
5

3

5
5
3

5

2

5
5

3
2

5

3
4

5

5

5

5

5

5

5

4

3

3

2

Executives
Tony Hall

11

Anne Bulford

10

Tim Davie

11

Ken MacQuarrie

10

3

5
2
3

2

3

2

This table does not include business conducted offline and update meetings where no formal business was considered.

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BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

Audit and Risk Committee ReportStatement from the Chair of the Audit
and Risk Committee
I am pleased to present the 2018/19
report of the Audit and Risk Committee(ARC) of the BBC Board.
Since coming into being in 2017 as part of
the new governance arrangements underthe BBC Charter, the Committee hascontinued to develop its understandingof the BBC, its key risks and the criticalareas that are kept under review.
This year the Committee has been able
to build on the firm foundations that wereported in the last Annual Report andAccounts, and has continued to provide
scrutiny to the organisation whilst
overseeing the ongoing development of
the BBC’s risk management framework.
Our workplan for this year has included:—

Ensuring that the work of theCommittee continues to fulfil therequirements of the new Charter.

—

Ensuring that the BBC’s relationshipwith the NAO, as both statutory andvalue for money auditor, is professionaland constructive. The NAO presents an
update on its current and planned
activity at every meeting.

—Taking a deeper look at selected BBC
initiatives and areas of risk. Matters
covered this year as part of theagendas have included: major projects,
BBC Studios, data management and
GDPR, resilience, cyber security, andchanges to accounting standards andpolicies.

—

122

Reviewing the risk profile of BBC
Studios with particular reference to thechanging risk profile following the BBC
Worldwide and BBC Production
merger.

—Monitoring the progress andimplications of matters relating to pay
and tax arrangements in the BBC.

—

Overseeing the good progress inindependent assurance and risk
management in the BBC, as well as thetimely implementation of internal audit
and NAO actions.

During the year we monitored
developments in relation to the handlingof historic payments to people regarded
as freelancers, and the consequent issues
with tax and national insurance liability.
A provision of £12 million in respect of
this matter has been classified by the
NAO as irregular. Whilst we would clearly
have preferred not to be in this position,
the Board considers that the approachbeing taken (including the settlement
proposal which has led to the provision)is the most fair, and best protects
the interests of licence fee payers.
We had five meetings during the year,
each of which was attended by executives
as appropriate, including the DirectorGeneral and Deputy Director-General. We
also held private meetings with the NAO
on each occasion. In addition, membersof the Committee have access to, andmeet on a regular basis, with the BBC
Director of Quality, Risk and Assurance.
I am particularly pleased with the progress
we have made in risk management. The
Committee receives clear and detailed
reports on strategic and operational risks,
linked to the BBC’s objectives. The use of
metrics and up-to-date data has enabled
the Committee to take a view on changes
in risk and the sufficiency of mitigations.
As part of our agenda, the Committee also
undertakes deeper reviews into specificrisk matters with relevant executive riskowners in attendance, as noted above.

BBC Group Annual Report and Accounts 2018/19

During the year, the Committee has
assessed its own effectiveness, using asurvey of members combined with anindependent review of our ways of working.
In addition, the Internal Audit function
was independently evaluated by theInstitute of Internal Auditors (IIA). In bothcases the results were very positive, andthe findings and recommendations werereviewed and agreed by the Committee.
This is my final year of an eight-year
tenure as Chair of the ARC (and preceding
Executive Audit Committee). Throughout
my time here I have been ably supported
by fellow committee members as well
as by a professional risk and assurance
team and secretariat. The openness
and professionalism of BBC staff who
have presented to us over the years has
been a source of great reassurance to
the Committee and to me. I thank them
all for the help they have given me.
The BBC faces significant challenges inaddressing the enormous change whichis affecting all of the markets in which it
operates. Unlike many of its competitors,
it has to do this under intense, diverse andconstant scrutiny. In this context it needs
to have first rate governance. I hope thatthe work of the Committee has helped tobuild this governance, and in general toensure that licence fee payers’ money iswell cared-for and appropriately spent.

Simon Burke
Chair
20 June 2019

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G OV E R N A N C E

Audit and Risk Committee ReportRole
The main purpose of the ARC is to review
and maintain oversight of the BBC’s
corporate governance, particularly
with respect to financial reporting,internal control and risk management.
In order to gain this assurance, theARC has responsibility for:——reviewing and overseeing theeffectiveness of the BBC Group’s
internal control and risk management
processes;
providing oversight of the key risksfacing the BBC Group and the actions
being taken to mitigate those risks toan acceptable level;—

reviewing the activities and risks of theBBC’s commercial subsidiaries,
ensuring that risks are acceptably
managed and that assurance isindependent and sufficient;—reviewing and challenging, where
necessary, the actions and judgementsof management in relation to the BBC’s
Annual Report and Accounts andrelated formal statements;

—

—

—

—

overseeing and directing the work of
the BBC’s Internal Audit function,
meeting with the Director of Quality,
Risk and Assurance privately to discuss
issues as necessary;giving due consideration to
Parliament’s expectations of the
management of BBC resources, as
expressed in reports of the Public
Accounts Committee and Value forMoney reports by the National
Audit Office;reviewing the external auditors’
proposed audit scope and strategy,
ensuring no unjustified restrictions orlimitations are made;reviewing the auditors’ quality control
procedures and steps taken by theauditor to respond to changes inregulatory and other requirements;—

meeting separately with the external
auditors to discuss any matters theCommittee or the auditors believe
should be discussed privately;—

considering the independence of theexternal auditor;

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reviewing the BBC’s systems for thedetection and prevention of fraud andcorruption; and—reviewing arrangements by which staffof the company may, in confidence,
raise concerns about possible
improprieties in matters of financial
reporting, illegality or other matters.

The ARC’s Standing Orders set out inmore detail our responsibilities. These
were approved by the BBC Board in
September 2018 and are reviewed regularly
by the Committee. They can be readon our website: bbc.com/aboutthebbc/
whoweare/bbcboard/auditandrisk.
Membership
The ARC comprises three nonexecutive members, of whom one musthave recent and relevant financial
experience. The members who
served during the past year are:—Simon Burke (Chair)—

Tom Ilube—

Ashley Steel

Simon Burke, the Committee Chairman, hassignificant, recent and relevant financial
experience. In addition, all of the membersof the Committee are individuals who holdor have held senior positions in similar sizedorganisations and have the experience andskills to properly fulfil their responsibilities.
When appropriate, the skills andexperiences of members are augmented
with advice from internal and external
professionals – for example on matterssuch as developments in financial reporting.
This has been the final year of Simon
Burke’s tenure as Committee Chairman.
His successor, Shirley Garrood, hasbeen appointed by the Board andan induction programme is in place
to ensure she is able to assume her
responsibilities swiftly and effectively.
Committee meetings are also attended
by the Director-General, the Chief
Financial Officer, Group GeneralCounsel, the Director of Quality, Risk andAssurance and senior representatives
from Internal Audit, Risk Management,
Finance and the National Audit Office,as the BBC’s statutory auditors.

The Committee also meets privately,
without any member of management
present, with both Internal Audit andthe auditors, on a regular basis.
During the year the Committee
undertook an exercise to assess its own
effectiveness. This was part of a wider
review of BBC Board and sub-committee
effectiveness facilitated by Internal
Audit. The findings of the review were
presented to Committee members.
Meetings
The Committee met five times
during 2018/19, at key times in thereporting and audit calendar.
Minutes from the meetings are madeavailable to the Board and summary
minutes are published on the BBC website:
bbc.com/aboutthebbc/whoweare/bbcboard/auditandrisk. Additionally, theChairman of the Committee reports backto the Board after each meeting on any
issues where action or improvement isrequired. The Committee also provides
views on the integrity of the financial
statements before the Annual Report
is approved by the Board as a whole.
Committee time was spent on thefollowing areas in the past year.
Integrity of financial reporting
The Committee reviewed theintegrity of the financial statementsof the BBC. In doing so it:—

identified, through discussion withboth management and the external
auditor, the key risks of misstatement
within the BBC’s financial statements,
including those areas where significant
financial judgements were required
and which have influenced the financial
statements;—

discussed these risks with the auditor
as part of the agreement of theexternal auditors’ audit plan and also
at the conclusion of the audit of thefinancial statements; and—reviewed and challenged detailed
papers received from management on
those areas requiring significant
financial judgement, taking account of
the views of the auditor.

BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

Set out below are the key areas of judgement and how the Committee has addressed them:
Area of judgement

Revenue recognition
There is an inherent financial risk around revenue recognition relating totiming of recognition of revenue. The nature of the risk varies between thelicence fee revenue in the public service and the commercial income.
Licence fee revenue is treated as an amount due from the relevant
Government department, principally the DCMS, on the basis that amounts
receivable from licence fee payers will be paid across. Commercial revenue
is more complex, with a number of different revenue streams including saleof content to global broadcasters, subscription income and revenue fromthe sale of physical and digital products. The complexity of contractual
terms may require judgements in assessing when revenue can berecognised, which is based on the delivery of performance obligations andwhen control is transferred to the customer.
Employment and taxation provisions
The financial statements include provisions of £25 million as part of theBBC’s programme of restructuring. Judgements in this area are largely
related to the timing of recognition of these provisions, the amount to berecognised and the amount which has been utilised in previous years. A
number of other employment-related provisions exist in instances where
the BBC has a present obligation as a result of a past event that is probableand can be reliably measured. Taxation, litigation and insurance provisionsof £40 million include an amount for payments to, or on behalf of,presenters relating to Personal Service Companies (PSC) as set out on
page 93 of the Chief Financial Officer’s Review.
Property – accounting treatment of BBC buildings and New Broadcasting
House refinancing
The BBC holds a significant property portfolio, which continues to berationalised in order to reduce costs. The estate includes properties held
under freehold and those held under finance and operating leases. Buildings
which have been sub-let or available for sub-let may be classified as
investment properties. Judgements relate to the future intentions for any
vacant buildings and the related timescales. This can change theappropriate accounting treatment and affect the carrying value on thebalance sheet. The derivative assets and liabilities connected to theunderlying Broadcasting House lease structure are subject to sensitivities inmarket data in addition to an adjustment to the discount rate to takeaccount of risk. As a result, net liabilities of £123 million have beenrecognised in relation to this arrangement. The transaction was
implemented in a manner that limited any increase in the BBC’s credit
exposure to the derivative counter-parties involved. The special purpose
vehicle established to redevelop Broadcasting House, Daunus Limited, isaccounted for as a joint venture following an assessment of control. The
BBC’s interest in the entity is at cost, and no indicators of impairment havebeen identified.
Capital projects
The BBC undertakes multiple capital projects at any one time, which
contribute to the overall strategy of the BBC. An assessment over theappropriateness of capitalisation, along with the valuation of any capitalised
asset, is required. If a material capital project cannot be completed on time,or will not derive future benefit to the BBC, this could trigger an impairment
charge.
Pension scheme – assumptions impacting the accounting pension deficit
The financial statements include a significant deficit on the balance sheet of£530 million for the BBC’s defined benefit pension scheme. Judgements are
required regarding the underlying assumptions used by the actuaries incalculating the pension deficit. Changes in these assumptions can result inlarge swings in the final numbers disclosed.

124

BBC Group Annual Report and Accounts 2018/19

The Committee’s response

The Committee considers that the BBC’s existing financial control systems
should ensure that income is properly treated in the financial statements.
The Committee has been briefed on the effect of the transition to IFRS 15
and is satisfied that it has been appropriately managed, reviewed andpresented fairly in the financial statements. There is confidence thatmanagement understand the risks in this area and have suitable controls
in place.

The Committee received reports on employment-related matters which
could result in the recognition of potential liabilities before subsequently
reviewing and discussing the level of provisions with management. This
included consideration of new provisions and any release and utilisation ofexisting provisions. Management confirmed that they have applied a
consistent approach to the identification, recognition and release ofprovisions across the BBC group. The Committee concluded it was satisfied
with the level of provisions carried and the disclosure in respect of those
provisions. The Committee also noted that the arrangement relating toindividuals paid via intermediaries has been considered in relation the NAO
regularity opinion.

The Committee reviewed reports from management, which explained thetreatment for the most significant buildings, including the projected
timescales for future activity and rationale for treatment. The detailed
treatment of the Broadcasting House derivative assets and liabilities
continue to be monitored. The Committee was satisfied that the treatmentof these properties within the financial statements was consistent withmanagement intention and in line with international financial reporting
standards.

Reports from management were reviewed, which explained the status ofmajor capital projects and the approach taken to assess whether or not any
impairment charge was required. The Committee was satisfied that theassessments of impairment undertaken by management were appropriate
and in line with international financial reporting standards.

The Committee took advice from independent actuaries on theappropriateness of the assumptions used, including how these compare withthose used by other organisations. Scrutiny focused in particular on theassumptions used regarding discount rates, inflation rates and mortality/life
expectancy and how changes in these assumptions would affect the financial
statements, including any movements in these from prior years. The
Committee was satisfied that the assumptions used in the financial
statements were reasonable, appropriate to the BBC and supported byindependent actuarial specialists.

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G OV E R N A N C EManagement confirmed to the Committeethat they were not aware of any
material misstatements or immaterial
misstatements made intentionally toachieve a particular presentation. The
auditors reported any misstatements thatthey had found in the course of their workand that no material amounts remain
unadjusted. The Committee can confirm
that it is satisfied that the external auditors
have fulfilled their responsibilities withdiligence and professional scepticism.
After reviewing the presentations andreports from management and consulting,where necessary, with the external auditors,
the Committee is satisfied that the financial
statements appropriately address thecritical judgements and key estimates(both in respect to the amounts reported
and the disclosures). The Committee
is also satisfied that the significant
assumptions used for determining
the value of assets and liabilities
have been appropriately scrutinised,challenged and are sufficiently robust.
The Committee reviewed the groupfinancial statements and how theseare positioned within the wider Annual
Report. To assist this review, reports frommanagement and from the internal andexternal auditors were considered, covering:—the quality and acceptability ofaccounting policies, including theircompliance with accounting standards;—

compliance with legal and regulatory
requirements;—

the clarity of disclosures and theircompliance with relevant reporting
requirements; and—whether the Annual Report as a wholeis fair, balanced and understandable
and provides the informationnecessary to assess the BBC’s
performance and strategy.

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Effectiveness of internal controls and risk
management framework
Internal controls assurance
The Committee focused during the year
on the effectiveness of the BBC’s system
of internal controls, taking account of
the findings from internal and external
audit reports and other assurance
activity across the Group. Specific areas
considered during the year included:

Risk management
The Committee considered the processes
for managing significant risks within
the BBC. This work is influenced by
the assessment of the BBC’s principal
risks (as set out on page 125). Thereis a regular Committee agenda item
where changes to the risk profile arereviewed and the effectiveness of therisk management process is assessed.

—

the trends and themes from Internal
Audit activity, questioning
representatives of Internal Audit on
the outcomes of their work. A summaryof every internal audit, including key
findings and assurance rating, wasreviewed by the Committee;—

actions arising from independent
assurance activity, including internaland external audit and NAO Value forMoney reviews, are monitored by theCommittee for completion. This is anarea followed up at every meeting toensure that agreed actions in respectof any weaknesses found are being
properly addressed;

The Committee has overseen
improvements to the BBC’s overallmanagement of risk, introducing greater
detail into risk reporting and ensuring thatmitigations and actions are aligned to the
key strategic and operational objectives of
the Corporation. Greater use of risk metrics
and measures now enables the Committee
to review risk at a more detailed level.

—

for areas which are considered highprofile or have received criticalassurance findings, the Committee
ensures there is suitable follow up andscrutiny over the completion of any
improvement plans or agreed actions;—the Committee approved the BBC’s
Modern Slavery statement andreviewed the approach for ensuring
compliance;—

regular whistleblowing reports andupdates on levels of fraud and theft,along with the mechanisms in place tominimise and prevent these; and—the findings and progress of actions
from the audits of BBC commercial
subsidiaries are considered. The CFO of
BBC Studios attends to provide
assurance on the control environment
and management of risk in thissubsidiary.

Effectiveness of Internal Audit
The work of Internal Audit is overseenby the Committee. This is a regular item
at each meeting which the Directorof Internal Audit also attends. During
the year the Committee has:—approved the plan of work for the
coming year, ensuring that it is risk
based and strikes a balance between
providing assurance over core businessprocesses and areas of emerging
strategic risk;—

considered the findings from audit
activity, focusing on audits with
unsatisfactory outcomes andmanagement’s plans to address these;—

reviewed the rationale and approved
the one-year extension of the Internal
Audit co-source; and—considered the resource requirements
for Internal Audit and its capability.

The Committee continues to monitor
the structure of the Internal Audit
function and the operation of the current
resourcing model, with a proportion ofaudits provided by an external partner.
The Committee is satisfied that thisarrangement is functioning well.

BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

During the year an independent
assessment of the Internal Audit function’s
effectiveness was validated by theInstitute for Internal Auditors. The findingsof this review and recommendations
were presented to the Committee.

Non-audit services
As one of the safeguards over the
independence of the external auditors, theCommittee has developed, and oversees,
the BBC’s policy on the commissioning of
the auditors to provide non-audit services.

The ARC Chairman also meets with
Internal Audit and Risk Management
before each Audit Committee meeting,without management present, to provide
the opportunity for open discussions.

This policy defines the types of services
which the external auditors can and cannot
provide. Additionally, it includes thresholds
above which any proposed non-audit
work to be carried out by the external
auditors must be approved in advance by
the ARC. It also defines when work mustbe submitted for competitive tender.

Independence and effectiveness of ourexternal auditors
Appointment of our external auditors
Under the 2016 Charter andAgreement, the NAO are appointed
the BBC’s statutory auditor for theduration of the Charter period.
Relationship with external auditors
The Committee oversaw the relationshipwith the NAO, including the scope of,and approach to, their work. Specificareas of focus this year have included:—

audit risk identification and alignmentof this with management risk
assessment;—

understanding of the elements of theaudit process, ensuring therequirements expected of the BBC
under the regularity and propriety
opinions are understood; and—private discussions with the auditors
without management present.

126

The NAO does not undertake work
which might compromise its ability togive independent opinion on the BBC’s
financial statements. Recruitment fromthe NAO into any senior management
position in the BBC would require
the prior approval of the ARC.

BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

Risks and opportunities
Risks and opportunities affect the ability of
the BBC to fulfil its Charter obligations andpublic purposes. Our approach to risk needs
to reflect the unique nature of the BBC.

Our approach to risk management
In a rapidly changing media environment, the BBC must be able to confidently manage
both strategic and operational risks, ensuring that it can continue to deliver our public
purposes and value to all audiences. We must also take seriously our regulatory andstatutory responsibilities. Just as taking risk is core to fulfilling our purposes and strategic
ambitions, rigorous risk assessment and mitigation is the foundation of delivering what
we do.
The BBC acknowledges the challenges of audience needs, as well as the opportunities thisoffers over the coming years. Throughout the Corporation, careful consideration of risks
and opportunities contributes to the quality of our programmes, the excellence of theservice we provide and our ability to serve our audiences.
Evolution of risk management at the BBC
Risk management at the BBC continues to evolve and develop. In 2018/19, we built upon
our process of managing strategic and operational risks across the business. We now havean established set of risk metrics for strategic and operational risks and this processprovides insight into how risks are being managed, and continues to provide early warning
indicators of risk and supports risk-based decision-making.
The BBC Executive Committee and BBC Board have participated in deep-dive sessions toreview strategic and operational risks, agree ownership, review their respective impact,
likelihood and assessed the adequacy of the BBC’s preparedness over these risks. Further
deep dive sessions are planned during the course of the year. As part of continuous
evolution, we plan to scan for emerging risks in the coming year.
Our principal strategic and operational risks and opportunities are set out overleaf.

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Key to risk movement:
anticipated movement in riskover the next 12 months
Risk increasing
No risk movement
Risk decreasing

Public purposes1

 o provide impartial news andT
information to help people
understand and engage withthe world around them2

 o support learning for peopleTof all ages3

 o show the most creative,Thighest quality and distinctive
output and services4

 o reflect, represent and serveTthe diverse communities of all of
the UK’s nations and regions and,in doing so, support the creative
economy across the UK5 o reflect the UK, its culture andTvalues to the world

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Strategic risks and opportunities
Note: Strategic risks and opportunities are mapped to the Public Purposes (1-5) below
Principal risks and opportunities

1. Making sure everyone gets value from the BBC
There is a risk that, as consumer behaviours change and online
business models develop, the BBC does not continue to provide
high-quality and relevant content and services to all licence fee
payers. There is also a risk that, in adapting to these challenges,
audiences on traditional platforms are not maintained. We may
also not meet the needs of underserved audiences, including
youth, nations and regions and BAME.
1

2

3

4

5

2. World-class creativity
Competition from other broadcasters and large scale consolidated
players for content and talent continues to increase. In an external
environment of cost inflation and digital disruption, there is a riskthat we do not secure best quality content supply frominvestments, acquisitions and associate relationships. There is arisk that BBC Studios does not develop its creative pipeline, win
external commissions or respond to intense competition for
creative talent and disruption caused by global SVOD providers.

Key mitigations—

Re-invention of the iPlayer to become a destination service foryoung audiences.

—

Launch of BBC Sounds in 2018 which brings live and ondemand radio, music and podcasts into a single personalised
product.

—

Delivering a year-round rhythm of stand-out moments andour ability to deliver public value.

—

Refreshing our content to appeal to younger audiences and toreflect the diversity of the UK.

—

A refreshed approach to diversity and inclusion that forms a
key part of our strategy with clear focus areas on on-screen
portrayal, commissioning and on-screen talent development
and diversity within our workforce.

—

Transforming the BBC News experience for younger audiences
e.g. via the launch of Beyond Today (BBC podcast for under35s); BBC Young Reporter (special outreach project for young
people) including the BBC Young Reporter of the Year
competition.

—

Delivering content via digital platforms i.e. iPlayer exclusive
content that is making a real impact with young people, stories
on social media platforms that is converted to BBC website
traffic, experimenting with short-form and long-form videos ornews clips.

—

Audience metrics monitored, including reach, time spent with
the BBC by demographics including young, BAME, nations andregions audiences and getting feedback, to drive informed
decision-making.

—Regular review of audience objectives, performance andtrends at Executive Committee and Board meetings.

—

Investing in new formats, high-end content, new series, newproducts and services for TV, radio and online for all audiences.

—Entering into creative partnerships in order to secure rights to
new content (e.g. comedy, drama) that are impactful.

—

Making iPlayer at the heart of live TV.

—

As part of our nations and regions strategy, we have launched
BBC Scotland. We continue to invest in our production bases
outside of London i.e. in Glasgow, Cardiff, Belfast, Salford,
Bristol and Birmingham.

—

Focus on attracting and retaining the best creative talent.

—On-air talent and programme diversity targets in place, withimproved measurement tools.

—

Well-established editorial policy, with extensive monitoringand Executive Committee and Board review of exceptions.

—

Lobbying for a level playing field with other digital media
organisations for a regulatory perspective.

—

New creative and business development leads within BBC
Studios to focus on key genres and opportunities.

—

A streamlined and focused pitch process is in place.

—

Additional investment in development activity across all
genres, with new creative and business development leads toidentify opportunities.

There is also a risk that we do not achieve authentic diversity inprogramme content and on-air impartial reporting.
2

128

3

4

5

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Principal risks and opportunities

3. Global reachOur ambition to grow global reach may be impacted by theincreasingly challenging market environment (with more choice forusers and consumption turning to social media), especially where
there is an over-reliance on news updates (rather than analysis andoriginal journalism). The reliance of World Service on syndication
creates a risk that audiences do not attribute content to the BBC.
The current government investment in the World Service expires in
September 2020.
1

3

2

3

4

2

Output continues to be monitored, supported by research, todevelop our proposition and to understand how we cancontinue to reach global audiences, including younger andfemale audience demographics.

—

Syndication contracts are carefully managed to ensure that we
can continue to reach the broadest audience through trusted
and reliable partners.

—

Greater attribution of content to the BBC (by audiences) to beaddressed through improved branding and distinctive content.

—

Ongoing development of digital offerings to extend the reachof digital content.

—

Investment in marketing and in technical innovation to
improve audience and performance measurement.

—

Multi-year savings targets are defined, underpinned bydetailed plans, with outer years in progress. 95% ofcontrollable spend covered by benchmarking (meeting
Compete or Compare criteria).

—

Licence fee to increase in line with inflation until 2021/22.
Cost of collection closely monitored, with actions in progress
to reduce evasion rates.

—

A public consultation was launched on the future of freelicence fee for over-75s with the results due later in 2019.

—

Clarity on pension costs through to the next valuation in 2019,and plans in place to eliminate the deficit and make thescheme self-sufficient by 2028.

—

Annual going concern and viability reviews to assess ongoing
financial stability.

—

A clear plan to manage the implications of the Board decision
relating to the over-75s licence fee concession.

—

Prioritisation of spend on content and services.

—

Change and Operations group ensures that business change is
implemented in a consistent, coordinated way. Extensive staff
communications, with engagement monitored through focus
groups and biennial employee survey.

—

Clear diversity targets in place, with regular reporting to theBoard, Centre of Excellence for diverse talent established andDiversity Commissioning Code of Practice implemented toensure shared values and commitments.

—

Significant Board attention to equal pay and gender pay gap
challenges, with a commitment to close the gender pay gap by
2020 and new pay principles introduced. Clearer career
structures provided through the introduction of the BBC
Career Path Frameworks.

—

Terms and conditions reviewed and modernised together with
the Joint Unions.

—

A series of regular online pulse surveys are carried out to give
real time insights to working life.

—

Transparency reviews of both Public Service and commercial
operations conducted in the year with supporting actions
implemented.

55. Making the BBC an even greater place to work
The extent of operational, organisational and culture change inprogress creates a risk that the organisation is placed undersignificant strain. There is a risk that we are not able to retain
employees in key areas due to pay challenges. Failure to meet our
diversity and inclusion targets could dishearten employees. Should
these risks arise, we may suffer a loss of key talent and/or an
increase in staff turnover, an increased risk of grievances and thethreat of industrial action.
1—

5

4. Financial stability
There is a risk that we do not effectively manage and/or offset theincreasing cost of procuring intellectual property and rights, in an
increasingly competitive environment, with rising content prices(especially sports and drama) and increasing rights scarcity
requiring new ways of working and a focus on cost management.
There is a risk of a real time licence fee decline, a rise in licence fee
evasion, or increased cost of collection potentially impacting ourfunding model, services and scope. There is a risk that the BBC’scommercial entities fail to respond to market challenges therefore
reducing financial returns. Risk of a decline in advertising sales
revenue for the BBC’s commercial entities would be exacerbatedby an economic downturn. Adverse changes to the actuarial
valuation of the pension scheme represent a risk. A reduction in
the BBC’s credit rating would increase the cost of funding.
1

Key mitigations

3

4

5

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Operational risks and opportunities
Principal risks and opportunities

1. Health, safety and security
The risk that we fail to protect our people, visitors, assets andpremises both at home and abroad, which could result in physicalor mental harm and/or disruption to the services that we provide.

2. Business management and change
The risk that we do not effectively manage our financial
performance, critical project portfolio, business continuity plans,
third party suppliers and anti-fraud processes, and in doing so
subject the BBC to unexpected financial cost, a detrimental impact
upon our reputation and/or regulatory intervention.

Key mitigations—

Specialised training in place for staff on high-risk deployments(and their managers) and each deployment subject tothorough risk assessment. Scenario planning and simulation
exercises conducted with key management teams.

—

Child protection controls include mandatory backgroundchecks for anyone working with children, supported bymandatory training and policies and compliance monitoring.

—

Ongoing security reviews for BBC premises and outside
broadcasts, and close links in place with UK security
authorities and cross-sector security forums.

—

Health and safety risk assessment process in place, supported
by training and safety monitoring audits. All reported
incidents investigated to identify any corrective action
required.

—

Detailed plans underpin savings targets and actions inprogress to reduce licence fee evasion.

—

The Corporate Project Management Office (PMO) assures thebusiness benefits and outcomes of critical projects. It assesses
risk and delivery confidence through partnering project
leaders and steering groups; monthly challenge cycle;
executive reporting and independent health checks.
Additionally, the PMO sets standards, supports developmentof project and change capability and ensures lessons areintegrated back into business operations.

—

Procurement monitor spend to ensure that supplier contracts
are in place, and to assess the adequacy of suppliermanagement to deliver value for money.

—

Business continuity plans and crisis management processes inplace, with regular exercises performed.

—

Detailed fraud risk assessments completed, the scopeincluded risks of bribery, asset misappropriation, conflicts ofinterest, expenses, payroll, procurement and payment
processes.

—

The BBC has put in place, as far as possible, mitigations in theevent of a no-deal Brexit. The risks associated with the various
scenarios are being monitored.

—

Policies in place, aligned with legal and regulatory
requirements, supported by training advice from subject
matter experts, and detailed monitoring and reporting.

—Oversight by the Data Protection Officer; GDPR-compliant
policies and processes on data protection and privacy,
including data subject rights and public-facing privacy policies;
data protection training for staff; resilience of IT systems;
access to in-house and external data protection legal advice.

—

Established editorial policy in place, with review in progress toensure it remains fit for purpose.

—

Process in place to ensure compliance with Ofcom regulatory
requirements, also supported by reporting and monitoring.

—

Ofcom complaints monitored with regular reporting to the
Director-General and Executive Committee, and monthly
Board reporting.

—Specialist teams in place to support compliance with tax, legal
e.g. employment, litigation, and other regulatory compliancerequirements.

The risk that we have not planned effectively and put mitigations inplace to limit the impact on operations and services in the event of
a no-deal exit from the European Union by the United Kingdom.

3. Compliance
The risk that we fail to comply with legal, regulatory and otherstandards/obligations (including internal requirements e.g.
editorial compliance) pertaining to the BBC; this may result in
reputational damage, loss of trust, legal action, fines or otherpenalties.

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Principal risks and opportunities

4. Technology
The risk that we fail to provide a resilient broadcasting service
across all distribution channels and/or protect the confidentiality,
integrity or availability of the BBC’s data through a cyber-attack.
Significant commercial and reputational risk from any uncontrolled
release of content.

Key mitigations—

Single points of failure identified and actions taken as
appropriate. Recovery plans in place and tested. Outages andadherence to recovery tie objectives closely monitored toensure minimal disruption to broadcast services.

—

Extensive policies and procedures in place to prevent/detectcyber threats and liaison with the National Centre for Cyber
Security to provide cyber risk intelligence.

—

Appropriate monitoring mechanisms are in place to provide
threat monitoring services with incident management
capabilities.

—

Mandatory Data Protection & Cyber Security training rolled
out to the business.

Note: The risks listed do not comprise all those associated with the BBC and the numerical referencing does not denote an order of priority. Additional risks and uncertainties notpresently known to management, or currently deemed to be less material, may also have an adverse effect on the Corporation. These less material risks are kept in view in case theirlikelihood or impact should show signs of increasing.

Risk management and internal control framework
The BBC’s process for identifying, evaluating and managing significant risks is aligned with the Financial Reporting Council’s Guidance on
Risk Management, Internal Control and Related Financial and Business Reporting. Risk management mechanisms are embedded withineach division, with central coordination to identify, escalate and manage pan-BBC risks.
Assessing the effectiveness of risk management and internal control
The Board used a number of mechanisms to help it assess the effectiveness of the system of risk management and internal control acrossthe BBC.
Risk oversight: The Board delegated responsibility for the specific review of risk and control processes to the Audit and Risk Committee.
The Audit and Risk Committee met regularly to provide scrutiny and oversight over the effectiveness of controls and the management ofrisks (further information is provided on page 122).
Internal Audit: The Internal Audit function maintained its independent reporting line into the Chair of the Audit and Risk Committee andconducted a programme of audits aligned to the principal risks facing the BBC. Findings from these audits have been reported to senior
management and the Audit and Risk Committee, with remediating actions tracked to completion.
External audits: The findings of external audit work performed by the National Audit Office have been reviewed by the Audit and Risk
Committee, and any recommended actions are tracked to completion. In addition, the National Audit Office continued its programme of
Value for Money audits.
Whistleblowing: A protected disclosure policy is in place, supported by a ‘whistleblowing’ hotline, administered by an independent
external company to ensure anonymity. A non-executive director was named on the policy as the contact for the raising of the mostserious concerns.

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Viability Statement
In accordance with provision C2.2 ofthe 2014 revision of the UK Corporate
Governance Code, the BBC Board
has assessed the prospects of the
Corporation over a longer period than
the 12 months required by the ‘going
concern’ provision. On an annual
basis, the BBC Board considers arolling three-year plan for the BBC.
The latest three-year plan, covering theperiod to 31 March 2022, was consideredby the BBC Board in March 2019. A threeyear horizon is considered appropriate
as this is in line with the BBC’s budgetingand planning process. The three-yearplan considers cash flows as well as thefinancial covenants and credit facilities.
Key assumptions underpinning the threeyear plan, and the associated cash flow
forecast, are the licence fee settlementthat set the financial parameters for the
BBC from 2017/18 to 2021/22 and our2015 document British Bold Creativethat set out the BBC’s vision, strategic
aims and its offer to the public.

132

A robust assessment of the principal risksfacing the Corporation, as described in the
Annual Report and Accounts from page
125, has been undertaken, including thosethat would threaten its business model,
future performance, solvency or liquidity.
Sensitivity analysis is applied to the cash
flow to model the potential effects should
principal risks actually occur, individually orin unison. The peak borrowing requirement
was calculated by modelling a combinationof severe but plausible risks, howeverwith the inclusion of mitigations, the cash
flows remained within the borrowing
limit throughout the three-year period.
Taking account of the BBC group’s
current position, the Board’s recent
decision on the funding of licences forthe over-75 population, principal risks
and the aforementioned sensitivity
analysis, the Board has a reasonable
expectation that the Corporation will beable to continue in operation and meetits liabilities as they fall due over thethree-year period of the assessment.

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Commercial Holdings Board Report
I was appointed to take over as the Chairof BBC Commercial Holdings Limited
from BBC Director-General Tony Hall in
April 2019, following a series of changes
recommended by Christopher Saul’sreview of transparency in the BBC’scommercial operations. This statement
reports on the year to 31 March 2019.
The BBC is a public service organisation,funded by the licence fee for UK audiences.
But as the high-quality content it
produces has global appeal, it is also
tasked with maximising its commercial
revenues and promoting the BBC’s brandand reputation around the world.
It was a strong year for the commercial
businesses, which declared dividends
paid in the year to the BBC of £73 million(2017/18: £38 million). It was a year oftransformation internally, with the mergerof BBC Studios and BBC Worldwide
to form the new BBC Studios taking
place at the very start of the financial
year, and the results from the mergedbusiness show early signs of success.
Additionally, much transformation has
occurred externally, as changes in audiencebehaviour continue apace, providing
both challenges and opportunities.
Financially, BBC Studios had a strong
year, with headline sales of £1,373
million (2017/18: £1,411 million) and
EBITDA of £159 million (2017/18: £105
million). Overall, the business delivered£243 million of returns to the BBC.
BBC Global News delivered a strong
financial performance with income of£114 million (2017/18: £109 million) and
EBITDA of £8 million (2017/18: £2 million).
Audience reach also increased, with theglobal footprint of the BBC World News
channel up by 2% and visitor numbers
to bbc.com up by 6% in the year.
BBC Studioworks achieved a robust
financial performance in the year, delivering
income of £37 million (2018: £31 million)
and EBITDA of £6 million (2018: £3 million).
The year-on-year 19% increase in income
reflects the impact of the re-introductionof the Television Centre facility into thecompany’s portfolio. BBC Studioworks
declared a cash dividend to the BBCGroup, for the first time, of £0.8 million.

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The commercial businesses do not exist justto generate financial returns, however. Eachhas an important role in the wider creative
economy, developing creative ideas,
investing in talent, training in specialist
skills and capabilities and promoting
British culture and creativity worldwide.
Looking forward, the BBC’s commercial
businesses will continue to play a criticalrole in support of licence fee revenue.
They must demonstrate efficiency, theagility needed to respond to changes inour global marketplace and an absolute
focus on the highest quality content.
Board meetings
The Board met seven times during theyear. Elan Closs Stephens, Glyn Isherwood
and Steve Morrison were appointed on
1 April 2019 so they did not attend any
Board meetings as a director during theyear. Anne Bulford, Mark Linsey and Anna
Mallett resigned with effect from 31 March
2019, while Howard Stringer resignedwith effect from 24 October 2018.
The attendance of directors of the company
who served during the year is as follows:
Director

Attendance/Total

Tony Hall

6/7

Anne Bulford

7/7

Tim Davie

7/7

Tom Fussell

7/7

Sarah Jones

5/7

Mark Linsey

5/7

Anna Mallett

6/7

Dharmash Mistry

6/7

Bal Samra

7/7

Howard Stringer

1/4

Elan Closs Stephens
Chair
20 June 2019

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Editorial Guidelines and Standards Committee Report
I am pleased to have continued as
Chair of the Editorial Guidelines andStandards Committee this year. 2018/19
has seen the Committee deal with animportant programme of work.
One of the main functions of theCommittee in 2018/19 was to oversee
revision of the BBC Editorial Guidelines
on behalf of the BBC Board. The updated
Guidelines are the first iteration under
the new governance structure of theBBC. The Agreement requires the BBC
to “set, publish, review periodically, andobserve guidelines designed to secure
appropriate standards in the context of
the UK Public Services”. As noted in lastyear’s Annual Report, BBC Editorial Policy
was commissioned by EGSC to revise the
Guidelines. Editorial Policy was asked
to bring drafts of the Guidelines to theCommittee at various stages of the revision
process. EGSC ensured that the revised
Guidelines reflect advice based on lessons
learnt from editorial breaches since thelast update of the Guidelines, including
updated privacy advice following the Sir
Cliff Richard legal ruling of 2018. A public
consultation on the final draft Guidelines(as approved by EGSC and the BBC
Board) was held from Monday 4 October
to Monday 12 November 2018. Editorial
Policy was asked to assess the responses
and make amendments to the Guidelines.
These revised Guidelines were discussed
and approved by EGSC and the BBC Board
in March. The Guidelines are available
online: bbc.co.uk/editorialguidelines.
A key priority for the BBC Board is toensure the BBC continues to provide
impartial high-quality output, as requiredby the Charter. We have been leading on
this work on behalf of the BBC Board.
Impartiality lies at the heart of public
service broadcasting and in an era of
misinformation and political division, therole of the BBC is even more fundamental
in helping audiences understand issues. In
addition to endorsing the principle of due
impartiality required of all BBC content,
the EGSC has encouraged a programmeof work to ensure that all staff are familiar
with the importance of the commitment
to impartiality and that close attention ispaid to audience feedback on this matter.
The Editorial Guidelines state that all BBC
pre-recorded content is watched or listened
to by two people prior to broadcast.
Compliance forms must also be completed.

134

BBC complaints 2018/19:

Ofcom:
Editorial complaints
within remit: 247
Number of complaints
upheld: 2
Stage 2, Editorial complaints:
549 – 84% answered on time
(target 80%)
Stage 1, Editorial and general complaints:
218,352 – 98% answered on time
(target 93%)

Spot checks are undertaken on regularoccasions by Internal Audit. The findingsof these spot checks are reported to EGSC
and, where there have been issues, wehave asked BBC divisions to explain what
has happened and that remedial action istaken to ensure the problem is resolved.
A key function of the Committee thisyear has been to ensure that the BBC’s
complaints process runs smoothly andthat all areas of the BBC abide by content
standards as set out in the Editorial
Guidelines and the Ofcom Broadcasting
Code. 98% of complaints at Stage 1 and
84% of complaints at Stage 2 of thecomplaints process have been handledwithin the target timeframe: 10 working
days for Stage 1 complaints; 20 working
days for standard Stage 2 complaints
and 35 working days for complex Stage
2 complaints. Where response times
have fallen below the targets set by the
Board, the reasons have been reported to
the Board. An issue, caused by a technicalproblem, arose with the collation of
the figures for Stage 2 complaints. Thiswas reported to EGSC and rectified.

Ian Hargreaves
Chair
20 June 2019

BBC Group Annual Report and Accounts 2018/19

Membership of the Editorial Guidelines
and Standards Committee
The Editorial Guidelines and Standards
Committee (EGSC) is responsible forcontent standards at the BBC. The
EGSC comprises three non-executive
directors and one executive director: Ian
Hargreaves (Chair), Tanni Grey-Thompson,
Nick Serota and Tony Hall. The EGSC
meetings are also attended by the Director,
Editorial Policy and Standards as the
Principal Adviser to the Committee.
Ofcom
The ‘BBC First’ process, as set out in theAgreement, is working well. Ofcom in its
first annual report on the BBC stated thatthe complaints process was effective andefficient. During this accounting period,
Ofcom found the BBC to be in breach of
the Broadcasting Code on two occasions,both of which had already been upheld by
the BBC’s Executive Complaints Unit (ECU)
at Stage 2 of the complaints process:Today, BBC Radio 4, 10 August 2017 –Breach of Rule 5.1 (due accuracy in News).
Ofcom felt that the presenter should havebeen prepared to provide challenge andcontext to Lord Lawson’s views
on climate change, as appropriate.
Stephen: The Murder that Changed a
Nation, BBC One, 19 April 2018 – Breachof Rule 7.1 (Fairness). The programme
failed to mention that the complainant’s
conviction and that of his colleague
were subsequently quashed.

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Ofcom also gave its first Opinion on a
BBC online material complaint during
this financial year. This Opinion related to
a complaint by Carter-Ruck on behalf ofBaroness Scotland. Ofcom said that the
BBC had observed the relevant Guidelinesand did not make any recommendation
to the BBC in relation to this article.
In an exceptional decision, in February 2019
Ofcom decided to publish its reasonsfor not upholding a complaint about
BBC coverage of the UK’s exit fromthe EU. Ofcom stated that this was toprovide guidance to broadcasters on themeaning of ‘due’ impartiality. Ofcom foundthat alternative viewpoints on
the issues were sufficiently represented
in the BBC programmes assessed(the subject of the complaint). Thisdecision was an endorsement of theBBC’s Stage 2 finding on the matter.
As requested by Ofcom, the BBC continues
to publish on a fortnightly basis details ofcomplaints which number over 100 and fallunder the remit of the Broadcasting Code.
These bulletins are published at: bbc.co.uk/
complaints/comp-reports/reports-archive.
The BBC also publishes responses tosignificant complaints, and the findings ofthe Executive Complaints Unit, on the BBC
Complaints site at: bbc.co.uk/complaints.

Human Planet, first broadcast in 2011.
Following the discovery of another accuracy
breach, the series has been withdrawn
and is no longer available to licensees.
David Baddiel Tries to Understand: WiFi,
BBC Radio 4, 24 October 2018. The
programme contained factual inaccuracies
about the properties, effects andpropagation of electromagnetic waves.
There were also mistakes in the selectionof interviewees. The programme wasrevoked from on-demand platforms.
BBC News Pidgin featured on its website
and Facebook page a propaganda
video shot by a kidnapper in Cameroon.
The video was taken down from both
platforms and BBC Editorial Policy has
provided bespoke training to the team.
In addition to these breaches, theExecutive Complaints Unit found a totalof 54 breaches of editorial standards thisfinancial year (including ten cases
in which the issue giving rise to thecomplaint had been resolved by action
taken by the relevant division before
the complaint was escalated to the
ECU). All serious editorial breaches
and upheld/partly upheld/resolved
complaints are reported promptly to
EGSC, together with action taken.

Editorial complaints and lessons learned
As in previous years, the majority of BBC
content complied with the standards
set by the BBC’s Editorial Guidelines.
However, the following serious breaches
were noted by the Committee:
BBC Afrique, 28 April 2018. The station
broadcast an interview with a humanrights activist who made allegations ofmurder and attempted murder against
the government and President of Burundi.
The programme did not substantiatethese allegations or offer a right of reply to
the government and President. The BBC
apologised for this serious editorial breach.

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Nations Committee Reports
The four Nations Committees support the Board in reviewing and monitoring the output and performance of the BBC acrossthe UK. This section provides a report from the Chair on the work of each Committee during the year.

Wales

Scotland

Following on from the investment promised
and acted upon by the Director-General,
it has been a good year for BBC Wales,with last year’s success Keeping Faithbeing followed with new drama Hidden,
another co-production with S4C. BBC
Wales commissions like The Factorywere taken up by the network and theCommittee was impressed with comedy
commissions – a challenging area but
one where Wales has talent. Our focus
as a Committee will be on supporting
re-investment and maintaining focus on
landmark programming across drama,
comedy and factual; building BBC Wales’
online and audio impact; and strengthening
and modernising news output.

It’s been an exciting year for the BBC in
Scotland, most notably with the launchof the BBC Scotland channel in February
2019. Scotland is the only one of the four
nations which now has two dedicatedtelevision channels – BBC Scotland and
BBC ALBA – and the new channel meansthat over 900 hours of additional originalcontent will be broadcast in Scotland
every year. The Scotland Committee had
an important role to play in supporting
BBC Scotland during its preparations
for the successful launch of the channel
and we look forward to continuing tomonitor its performance and celebrate
its successes over the coming year.

I was joined on the Wales Committee by
Ian Hargreaves, Ken MacQuarrie, Rhodri
Talfan Davies and Rhys Evans, withother staff attending the meetings as
required. During the year we met twice
in Cardiff and once in Swansea, where
we took part in an engagement session
with younger audience members.
Over the year we discussed the media
landscape in Wales with Ofcom Wales andmet with the author of the independent
review of S4C, Euryn Ogwen Williams.
We were pleased that the relationshipbetween S4C and the BBC was one of
co-operation and understanding.
As part of our work we received
regular updates on Out of London
targets and Audience Performancein Wales, focusing in particular on
BBC Radio Wales where extensive
audience research had resulted in some
programming changes. We were awarein particular of the move to streaming
services among younger audiences.
At the start of this financial year, thedevelopers handed over the keys of BBC
Wales’ new headquarters at Central
Square in Cardiff. The huge enterprise ofmoving from Llandaff begins in autumn
2019. This will be the first facility in
the UK to use IP technology acrossproduction and broadcast operations.

Investment in our digital and engineering
teams, plus the new roles created by
the channel, has resulted in the creationof over 200 new BBC roles in Scotland
this year; the biggest single investment
in content production in a generation.
Our technology hub based in Glasgow
continues to grow and I’m pleased thatit’s becoming a centre of excellencefor voice recognition and machinelearning, amongst other specialisms.
It’s also been a great year for programmes
made in Scotland. These include The
Cry, a four-part psychological drama for
BBC One which was filmed in Scotland
as well as Australia. In its first month the
new Scotland channel broadcast somestandout programming: Inside Central
Station, which quickly became one of its
most popular programmes; Yes/No: Inside
the Indyref, which provided the insidestory into one of the most monumental
events in recent Scottish history; andA View from the Terrace, a light-hearted
look at the world of Scottish football.

I was joined on the Scotland Committeeby David Clementi, Ken MacQuarrie,
Donalda MacKinnon (Director, Scotland)
and Ian Small (Head of Public Policy andCorporate Affairs). This year we met in
Glasgow, Dundee and Aberdeen. Whilst in
Dundee and Aberdeen we engaged withrepresentatives from the arts, business,
cultural and education sectors to hear
their views on BBC output and discuss
ways in which we could collaborate further
to help grow the creative industries.
Understanding and engaging with Scottish
audiences is a key role of the Committee.
The Committee considers the performanceof all of the BBC’s services in Scotland at
every one of its meetings and in October
2018 we held an audience engagement
session with 18 to 34 year olds basedin Dundee. The participants expressed
respect for the BBC and praised the highquality of its content; at the same time,
we heard that they would like the BBC
to make more programmes which feel
relevant to young people. The arrival of
the new BBC Scotland channel will help
in this regard as it is already attracting
new, younger viewers to the BBC. We
look forward to engaging with audiences,
particularly to hear their views on the
Scotland channel, in the coming year.
More detailed information on BBC
performance in Scotland can be found atpages 42 and 171 of this Annual Report.

Steve Morrison
Chair, Scotland Committee

We celebrated the 10th anniversaryof BBC Alba and I’m pleased that thechannel now broadcasts weekend news
for the first time, as well as delighting
the newest generation of Gaelic speakers
with CBeebies and CBBC programmes.

More detailed information on BBC
performance in Wales can be found atpages 40 and 167 of this Annual Report.

Elan Closs Stephens
Chair, Wales Committee

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Northern Ireland

EnglandDuring the year the Northern Ireland
Committee has continued to monitor,
review and support the BBC’s workand performance in Northern Ireland. I
continued to chair Committee meetings
throughout the year in the absence ofa BBC non-executive director (or Board
Member) for Northern Ireland. This position
has not been filled because it requires theinvolvement of the Executive at Stormont.

I am delighted to have been Chair of
the England Committee over the last
12 months.

The Committee met in person twice during
the year and visited Antrim to take partin an engagement session with younger
audience members in the autumn. It also
had the opportunity to meet with a crosssection of people from different sectors
and organisations to hear their views on theBBC. I was joined on the Committee during
the year by David Clementi, Peter Johnston,
Nations Director, Northern Ireland, Anne
Bulford, Deputy Director-General, andElan Closs Stephens. Mark Adair, Head of
Policy for Northern Ireland, also joined asa Committee member during the year.
In its work, the Committee received
updates on BBC investment and output at
local level, including developments linked
to the refurbishment and extension of
Broadcasting House, Belfast. It discussed
the implementation of a new digitalstrategy for BBC news services in Northern
Ireland and the continuing popularity
of BBC Radio Ulster/Foyle and locally
produced television programmes. We also
heard about technological innovation andits benefits for BBC output and audiences
and ongoing work to make our archives
more generally accessible. More detailed
information on BBC performance inNorthern Ireland can be found at pages
44 and 175 of this Annual Report.
We know the important role that the
BBC plays in supporting the creative
industries in Northern Ireland. And it
has helped to bring local talent, voices,
places and concerns to a wider BBC
network audience. Partnerships haveunderpinned much of this work and thesewill remain a priority over the next period
in addition to work to engage younger
audiences and to deliver against the BBC’s
programme and portrayal commitments
for Northern Ireland. A significant year of
programming lies ahead, across a range
of genres and issues, and the Committee
will keep all of this under review.

In the past year, in addition to existing
members Tom Ilube (non-executive
director) and Ken MacQuarrie (Director
BBC Nations and Regions), the Committee
has welcomed new members Helen Thomas(Director, BBC England) and Chris Burns(Head of BBC Local Radio in England). I
would like to pass on my personal thanks tofour people who are no longer Committee
members; namely Alice Webb (Director,
BBC Children’s and Education), Joe Godwin(Director, BBC Midlands), Pat Connor(Director, BBC South West), and David
Holdsworth (Controller, English Regions).
At the beginning of 2018, the Committee
agreed that the key issues for the year
should be youth and BAME audiences,and in particular how people in the major
English cities viewed BBC content, as
those areas were likely to be younger andmore diverse. During the course of 2018,
Committee members undertook audiencegroups sessions including meetings inLeicester at the Unity Boxing Club andthe Belgrave Neighbourhood Centre,
and in Leeds at the Priesthorpe School
and the Hamara Centre. The Committee
also visited Margate and met with local
residents to explore their thoughts on ourservices. This provided us with a different
perspective from an English coastal town.
With Helen Thomas I travelled toJersey and Guernsey. Here we met withlocal representatives of these island
communities where we were told about
the importance of BBC local services
to day-to-day lives. Finally, I visited the
local radio station in Swindon. I talked
with journalists who were on the frontline of reporting the tragic novichok
poisoning in Salisbury. The significanceof having established local contacts
with local people plays a vital part inenabling our journalists to report breaking
news in a meaningful and timely way.

We will continue to speak with people
across England. Meanwhile I wish to
thank all those people who have kindly
taken the time to speak with me andthe England Committee. We greatly
appreciate your comments and support.
In October, Helen Thomas (as the new
Director for BBC England) presented her
new strategy for England. At the heart ofthe strategy is recognition of the need tochampion all audiences across England,particularly underserved audiences. Thismeans we have to transform the BBC’saudience offer as well as helping to growthe creative and economic impact of BBC
England. In Local Radio our mission will
be not only to provide local news but toreflect and connect with audiences byowning the local conversation. We wantto provide opportunities for those new tobroadcasting and be a place that seeks
to constantly innovate. In support of thisHelen Thomas and Chris Burns visited all
the BBC sites across England this year, inorder to both hear from BBC staff and todeliver their key messages. This has laid
the path for change over the coming year.
More detailed information on BBC
performance in England can be found atpages 46 and 179 of this Annual Report.

Ashley Steel
Chair, England Committee

Through the year our engagement withaudiences has provided the Committeewith many insights, including the needto improve portrayal of BAME peoplein our programming and the strong
desire to increase the content available
on iPlayer, including extending its
time availability. These are just two
examples of what those we serve wantfrom their public broadcaster.

Ken MacQuarrie
Chair, Northern Ireland Committee
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Fair Trading Report
The last year has been one in which the
Fair Trading Committee has focused on
developing our oversight of the BBC’s
trading, separation and regulatorycompliance mechanisms. Our work has
been focused on deepening ourunderstanding of the BBC’s commercial
subsidiaries, understanding the impactsof changes to commercial structuresand forging closer relations with Ofcom,
who set the framework for all Fair
Trading matters.
The BBC’s Fair Trading framework has
been in place for many years and is wellembedded in the organisation. It also
continues to be of vital and increasing
importance – it ensures that the BBC
is equipped to meet its obligation to
trade fairly with any and all third parties,
and these issues are only becoming
increasingly important as the balance ofcommercial activity in the Group grows.
The Committee’s core business during theyear has included:—

considering the BBC’s processes for
ensuring compliance with Ofcom’s
rules and reviewing compliancewith these;—taking a quarterly management reportfrom the Executive, detailing specificengagement with upcoming andongoing Fair Trading issues acrossthe BBC;—

reviewing and monitoring targets
for Fair Trading training across theBBC; and—approval of all relevant publications
and reports that the BBC must provide
specifically to meet Ofcom’s trading
and separation rules.

During the year, the Committee also
discussed the BBC’s engagement with
Ofcom’s consultation on their updated
trading and separation rules. We have noted
the final conclusions of that consultation
and are now overseeing the BBC’s
implementation of the new requirements.
These include a statement of operational
separation, which we refer to in this reportand can be found on the BBC’s website at:bbc.com/aboutthebbc/reports/policies.

Of course there is always more to do and
we are not complacent – we want to be astransparent as possible and we welcomed
Christopher Saul’s conclusions following
his review of Commercial Transparency
in the BBC. In his report, Chris foundthat “the overall level of transparency ofthe commercial subsidiaries in the areasof governance, regulation and pay andreward is at least as good as that to befound at peer businesses.” This was awelcome finding and gave the Committeereassurance that the framework istrusted, mature and well-functioning.
The development of the BBC’s commercial
governance has also been a key part ofthis year and it is welcome that the newly
constituted Commercial Holdings Board(CHB) will continue to help to ensure thattrading and separation requirements
are a core consideration for CHB. I am
looking forward to working closely with
Elan Closs Stephens, as Chair of theCHB, to develop a strong assurance
process during the coming year.
I would like to thank my colleagues on theCommittee for their support, expertiseand contributions to our meetings. During
the year the members included Steve
Morrison, Ian Hargreaves and Elan and weare supported by central Policy, Financeand Legal teams who are well versed in
the issues at hand. It was also pleasing tonote the findings of this year’s Deloitte
Fair Trading audit, which showed thatthe BBC has an established system ofinternal controls in this area. Their fullopinion can be found on page 140.
All in all, I am confident that this reportshows that the BBC is operating wellwithin the frameworks set for us by
Ofcom, and we are looking forward to
the coming year when we will continue
to broaden our work and develop our
assurance of all that the BBC does inthis important – and growing – area.

Tom Ilube
Chair
20 June 2019

Overall, from our work this year, we
feel the system is working well andnote there have been no Fair Trading
complaints to report in the year. Thisis a welcome development and I hope
gives assurance to those outside the BBC
that our processes are working well.

What do we mean by Fair Trading?
Fair Trading is the way that we describe ourprocesses and practices which ensure thatwhen we undertake commercial and trading
activities we do so in a way that does notrisk distorting the market. This means thatthe BBC trades on equivalent terms with its
commercial subsidiaries and third parties– whether we are buying studio space or
charging producers to use a BBC officewhen making a TV programme for us – andthe BBC’s commercial subsidiaries therefore
receive no unfair competitive advantage asa result of their relationship with the BBC.
Our processes and practices are alignedwith Ofcom’s trading and separation rules
which form part of Ofcom’s overarching
operating framework for the BBC.
What does the Fair Trading Committeedo?
The Fair Trading Committee (FTC) wasestablished by the Board as a means
to monitor and assure the appropriate
financial and operational separation
between the BBC’s public service
and commercial activities, in line with
Ofcom’s framework. The Committee
was put in place voluntarily by the
Board, in recognition of the importancethe BBC places on transparency andcommercial efficiency in the operationof its commercial subsidiaries.
The key function of the FTC is tooversee the BBC’s compliance with ourregulatory obligations for trading andseparation between the public service
and the commercial subsidiaries1. The
core responsibilities of the FTC include:—considering reports on the extent towhich the activities of the BBC areconsistent with Ofcom’s trading andseparation requirements;—

keeping under review the BBC’s
compliance with Ofcom’s trading andseparation regulatory requirements;—

commissioning and receiving theannual independent audit ofcompliance controls;—considering and approving for
publication the BBC’s transfer pricing
methodologies; and—ensuring that the BBC’s transfer
pricing methodologies are reviewed
regularly.

1 In 2018/19 – BBC Studios, BBC Studioworks andGlobal News Limited.

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G OV E R N A N C E

During the year, Ofcom has consulted
on changes to its trading and separation
rules, and published revised rules in
February 2019. The BBC and the FTC
engaged fully with this consultationand is now putting in place measures
to implement the new rules. These newrules set out all of Ofcom’s requirements
for the BBC’s commercial and trading
activities, including their requirements formonitoring, reporting and transparency.
The framework requires the BBC toensure that:—

all commercial activities areundertaken by separate commercial
subsidiaries;—

all commercial subsidiaries areoperationally separate from the public
service BBC;—the BBC provides goods and services
to commercial subsidiaries on arm’s
length commercial terms, as we wouldwith any third party;—

each of the BBC’s commercial
subsidiaries achieve a commercial rateof return; and—there is appropriate transparency,
monitoring and reporting on theactivities of the subsidiaries.

To ensure that these rules are complied
with, the FTC oversees and assures theBBC’s processes and procedures to ensurethat awareness and understanding of
the framework is high. To do this, theBBC’s Group Regulation team manages
a targeted training programme forstaff likely to encounter Fair Trading
issues. The training has continued to
be updated, revised and made moreaccessible to all eligible staff this year,
including by targeting in-depth training
at those employees working in areas ofhighest Fair Trading risk. The Fair Trading
Committee has overseen these processes
and monitored compliance with them.
The Committee is briefed on relevant
regulatory and Fair Trading complaints
received and handled by the BBC. Detailsof these are reported elsewhere in the
Annual Report, though the Committee
noted that no specific Fair Trading
complaints were received in the year.

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How the Committee works
In 2018/19, the FTC comprised four nonexecutive directors: Tom Ilube (Chair),Elan Closs Stephens, Ian Hargreaves andSteve Morrison. At the end of the year,
Elan Closs Stephens stepped down fromthe Committee and assumed the role of
Chair of the BBC’s Commercial Holdings
Board. The FTC’s meetings were attended,
during the year, by the Deputy DirectorGeneral, Director of Policy and the Head ofRegulation, as well as the Group GeneralCounsel and other advisers as necessary.
Three Committee meetings were held
during the year, with papers also approved
offline where necessary (see page 121).
To support the framework, and to assure
the BBC’s approach to regularity and theuse of public funds, the FTC continues tovoluntarily commission an annual audit
by independent auditors, and separately
has been accredited with the ISO
9001:2008 quality standard. The auditors’
report is set out on the next page.
Statement on operational separation
The FTC is satisfied that in 2018/19
the BBC has complied with all relevant
operational separation requirements as
set out in Ofcom’s trading and separation
rules. Alongside this report the BBC
has published further details of therisks it has identified in this area, andthe measures and controls the BBC has
put in place to mitigate these risks.
For 2018/19, the FTC is not aware of
any issues with the effectiveness ofthe measures and controls that the
BBC has put in place to comply with
Ofcom’s requirements, as set out
further on the BBC website. The FTC
expects the BBC to provide quarterly
updates on operational separation aspart of the management report.
Having received reports from relevant
senior management, and having
considered the findings of the Fair Trading
Audit, the Fair Trading Committee issatisfied that all commercial services
have met the above criteria for theperiod 1 April 2018 to 31 March 2019.

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Independent Fair Trading Auditors’ Reportto the BBC for the year ended 31 March 2019
We have audited, in our role as the BBC’s
Fair Trading auditors, the system ofinternal controls established within the
BBC to provide the BBC with reasonableassurance that the BBC Board (‘theBoard’) has complied with the Fair Trading
aspects of Ofcom’s Trading and Separation
requirements for the year ended 31 March
2019 (‘the Fair Trading Arrangements’).
Our instructions for this engagement,
including the scope of work to beundertaken, were agreed with the BBC’s
Fair Trading Committee (the ‘FTC’), a
sub-committee of the BBC Board. These
instructions include agreement that our
audit should be conducted in accordancewith International Standard on Assurance
Engagements (‘ISAE’) 3000, agreementon the limit of our liability in respect of
this work and agreement that our dutyof care in respect of this work is solely to
the BBC. We are satisfied that the agreed
scope of our audit was sufficient to enable
us to express the opinion set out below.
Respective responsibilities of BBC Board
and Fair Trading auditors
The Board is charged by Ofcom withestablishing and operating a system
of internal controls designed toensure compliance with the BBC’s
Fair Trading Arrangements for theyear ended 31 March 2019, including
identifying and assessing risks that could
threaten fair trading and designing andimplementing responses to such risks.
As the BBC’s Fair Trading auditor, it is our
responsibility to form an independent view,
based on our audit work, as to the extent towhich the BBC has established, and applied,a system of internal controls which provide
reasonable assurance that it has compliedwith the requirements of its Fair Trading
Arrangements for the year ended 31 March
2019. We have reviewed specific decisions
reached by the BBC on Fair Trading
issues only in so far as this is necessary
to form an opinion on the applicationof the system of internal controls.

140

Our opinion has been prepared for andonly for the BBC in accordance with our
instructions which were agreed with the
Fair Trading Committee on behalf of theBBC. We do not, in giving this opinion,
accept or assume responsibility for any
other purpose or to any person otherthan the Board to whom this report isshown or into whose hands it may come,and no other person shall be entitled torely on our opinion, save where expressly
agreed by our prior consent in writing.
Our approach
We have performed a reasonableassurance engagement as defined in
ISAE 3000. The objective of a reasonableassurance engagement is to perform
such procedures as to obtain informationand explanations which we consider
necessary in order to provide us with
sufficient appropriate evidence to express
a conclusion on the BBC’s compliancewith its Fair Trading Arrangements
for the year ended 31 March 2019.
Our work consisted of enquiry and testing
to enable us to form a view as to whether
an appropriate system of internal controls
was in place. We conducted a risk-based
analysis to identify those aspects of theBBC’s Trading and Separation control
regime that represents the most significant
risk, and focused our detailed testingon those areas. Individual cases wereselected from the BBC’s fair trading log forreview. In each case we examined written
records and interviewed relevant parties
to provide us with reasonable assurance
that the system of internal control had
been applied. Cases examined, and theareas of significant risk around which thework was focused, included examinationof transfer pricing and separation
arrangements, use of and payment for
the BBC brand, and the application of
the Royal Charter requirement that its
commercial activities do not, as a resultof their relationship with the UK PublicServices, non-service activities or trading
activities, distort the market or gain
an unfair competitive advantage. We
observed, through the course of our work,a culture of consultation and referral
in respect of Fair Trading matters.

BBC Group Annual Report and Accounts 2018/19

Inherent limitations
As with any system of control, it is notpracticable to ensure that no errors or
irregularities have occurred without
being detected. Our audit work was
designed to give the Board reasonableassurance as to the adequacy of thesystem of internal controls which wasin place and being applied to delivercompliance with the requirements of its
Fair Trading Arrangements for the year
ended 31 March 2019. Further, because fairtrading issues require judgements which
ultimately might be tested in a court oflaw, competition authority or elsewhere,
there is always a risk of challenge even
where the system of internal controls
has been followed and decisions havebeen taken with the greatest care.
OpinionBased on the results of our procedures, in
our opinion the BBC has established andhas applied a system of internal controlsthat provide reasonable assurance thatit has complied with the requirementsof the Fair Trading Arrangements forthe year ended 31 March 2019.

Deloitte LLP
Chartered Accountants
London20 June 2019

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G OV E R N A N C E

Statement of Board responsibilities in respectof the Annual Report and Accounts
The Charter requires the BBC to prepare
an audited annual report and statementof accounts.
The Board has accepted its responsibility
for the preparation of a strategic report,
statements of compliance with applicable
codes and regulations (including the Board
remuneration report) and the statement ofaccounts which are intended to give a trueand fair view of the state of affairs of the
BBC and its subsidiaries (the ‘Group’) and of
the income and expenditure for that period.
The Board has prepared the accounts inaccordance with International Financial
Reporting Standards (IFRS) as adopted
by the EU. The Board must not approve
the statement of accounts (or ‘financial
statements’) unless it is satisfied that theygive a true and fair view of the assets,
liabilities and financial position of the Groupand of the surplus or deficit for that period.
In preparing the financial statements,
the Board has:—selected suitable accounting policies
and applied them consistently;—

made judgements and estimates thatare reasonable and prudent;—

stated whether they have been
prepared in accordance with IFRS as
adopted by the EU; and—prepared the financial statements on
the going concern basis as they believethat the BBC will continue in business.

The Board is responsible for keeping
proper accounting records that are
sufficient to show and explain the BBC’stransactions and disclose with reasonableaccuracy at any time the financial positionof the Group and enable them to ensurethat the financial statements and theBoard remuneration report comply
with the Charter. It also has a general
responsibility for taking such steps as
are reasonably open to it to safeguard
the assets of the BBC and to prevent anddetect fraud and other irregularities.

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The responsibilities of the Boardfor ensuring that the BBC exercises
rigorous stewardship of public money,
including responsibility for the propriety
and regularity of management of
the BBC’s resources, are set out
in article 16 of the Charter.
The Board is responsible for the
maintenance and integrity of the BBC’s
website. Legislation in the UK governing
the preparation and dissemination offinancial statements may differ fromlegislation in other jurisdictions.
The Board members who held officeat the date of approval of the Annual
Report and Accounts, whose names andfunctions are listed in the Governancesection of the Annual Report andAccounts, confirm that, to the best ofeach of their knowledge and belief:—

the financial statements, prepared inaccordance with IFRS as adopted by
the EU, give a true and fair view of theassets, liabilities, financial position anddeficit of the Group;—

the Annual Report includes a fairreview of the development andperformance of the business and theposition of the Group, together with adescription of the principal risks anduncertainties that it faces; and—the Annual Report, taken as a whole, isfair, balanced and understandable andprovides the information necessary forlicence fee payers to assess theGroup’s performance, business modeland strategy.

Statement of disclosure of information
to auditors
The Board members who held office atthe date of approval of the Annual Reportand Accounts confirm that, so far as they
are each aware, there is no relevant audit
information of which the BBC’s auditors
are unaware; and each Board member
has taken all the steps that they ought tohave taken as a Board member to makethemselves aware of any relevant audit
information and to establish that the BBC’s
auditors are aware of that information.
Going concern
The directors have prepared cash
flow forecasts for a period in excess
of a year from the date of approval ofthese financial statements, and havereviewed these forecasts, together withthe sensitivities and mitigating factors
in the context of available funds.
The directors are satisfied that the BBC
is well placed to manage the risks andhas adequate resources to continue inoperation for the foreseeable future.
As a result, the going concern basis
has been adopted in the preparationof the financial statements.
This statement was approved by the Board.

Sir David Clementi
Chairman
20 June 2019

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141Performanceagainst public
commitments

p.166
Nations’ data packs
Detailed performance data byservice in Wales, Scotland,
Northern Ireland and England.

This section sets out our progress towards various public
commitments. These commitments come from the Charter, theAgreement, our licence obligations and commitments we havemade to deliver services for our audiences.

Radio 1 presenter Clara Amfo
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Regulatory complianceThis section sets out the BBC’s performance against its commitments in the UK Public Services. The table below sets out regulatory
conditions under Ofcom’s Operating Licence. Compliance is measured across the 2018/19 financial year unless otherwise stated. The
requirements below are arranged by public purpose. The majority of Operating Licence conditions first came into force on either
1 January or 1 April 2018. Therefore, 2018/19 is the first year in which we are reporting against the full Operating Licence. In some cases,
we have reported compliance against Operating Licence conditions which were applicable in 2018, prior to the most recent issue of thelicence in January 2019.
The BBC met all its Operating Licence conditions, with the two exceptions below:—

Radio 2 broadcast 257 hours of live music in 2018/19, due to the cancellation of some events;—

On our popular Gaelic language service Radio nan Gàidheal, 44% of the content broadcast in core hours was speech content, whichis consistent with our historic performance. We are working with Ofcom to establish the correct quota for 2019/20.

Purpose One: To provide impartial news and information to help people understand and engage with the world around them
Note

Quota

ResultBBC OneNews throughout the day
Hours of news

1

Hours of current affairs in peak

1

1,520
(280 in peak)
45

1,655
(295 in peak)
47

450(106 in peak)

568(106 in peak)

85

92

Radio 1
Hours of news in daytime each weekday, including two extended bulletins (one in peak)
Regular bulletins in daytime at weekends

1

1

1Xtra
Hours of news in daytime each weekday, including two extended bulletins
Regular bulletins in daytime at weekends

1

1

17
(3 in peak)17(3 in peak)

2,750

3,394

75

76

BBC 6 Music
Weekly hours of news

6

6

BBC Asian Network
Weekly hours of news and current affairs

24

24

BBC One and BBC Two
Hours of current affairs

1,2

CBBC
News throughout the day
Hours of news
BBC News
More international news than other main continuous news channels in the UK
More local/regional news than other main continuous news channels in the UK

Radio 2
Weekly hours of news and current affairs
Regular bulletins
Radio 3
News throughout the day
Radio 4
Hours of news and current affairs
Daily reports of Parliamentary proceedings when Parliament is sitting
BBC Radio 5 live
% of output that is news and current affairs
Extensive coverage of local and general elections, elections to the devolved chambers,
and regular coverage of European and international politics

BBC Online
Adequate links to material provided by third parties
Notes
1 Measured across the 2018 calendar year2	Measured across the two channels

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Purpose Two: To support learning for people of all ages
Note

Quota

Result45

63(29 in peak)

115

141
(9 in peak)

BBC Two
Hours of arts and music, including some in peak

175

221
(69 in peak)

BBC Four
Hours of news arts and music programmes

175

236

1,000
675

1,906
1,226

BBC OneHours of arts and music, including some in peak
BBC One and BBC Two
Hours of religious programmes

1

CBeebies
A range of content which supports pre-school children in their learning
CBBC
Hours of drama
Hours of factual programmes
BBC ALBA
Weekly hours for Gaelic language learners (originations only)

5

13

Radio 1
Number of new documentaries

2

40

42

1Xtra
Number of documentaries

40

43

Radio 2
Hour s of arts programming
Hours of new documentaries
Hours of religious output covering a broad range of faiths

100
130
170

131
130
199

Radio 3% of output that is live or specially recorded music
Number of live or specially recorded performances
Number of new musical works commissioned
Number of new documentaries on arts and cultural topics

45
440
25
35

57
501
32
38

Radio 4
Hours of original documentaries
Hours of original religious programming

375
200

403
225

BBC 6 Music
Hours of speech-based features, documentaries and essays

520

520

BBC Online
Content which supports children and teenagers in their formal learningin all parts of the UK
Notes
1 	Measured across the two channels
2 	 Originations includes programming first shown on other UK Public Services

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Purpose Three: To show the most creative, highest quality and distinctive output and services
Note

Television% of hours that were originations
BBC OneBBC One in peak
BBC Two
BBC Two in peak
BBC Four
BBC Four in peak
BBC News
BBC Parliament
CBBC
CBeebies
BBC ALBA
BBC Scotland
Hours of first-run originations across daytime and peak
BBC One
BBC Two
CBBC
CBeebies

Result

75
90
75
90
75
60
90
90
72
70
75
75

86
99
92
95
92
89
98
98
81
72
94
99

4,000
2,200
400
100

4,344
2,826
413
127

300

353
(215 in peak)

45
50
60
175

47
52
67
182

2

3

40
20
260
1,100

49
28
257
1,193

20

20

1,2

3
2,4

BBC One and BBC Two
Hours of comedy programmes, some in peak

5

Radio
Radio 1% of music in daytime from UK acts
% of new music in daytime, with significant proportion from new and emerging UK artists
Weekly hours of specialist music
Number of new sessions live or recorded within previous three months
Broader range of music than comparable providers, taking into account both number ofplays and size of playlist, in daytime and peak
Number of major social action campaigns
Radio 2% of music in daytime from UK acts
% of new music in daytime, with significant proportion from new and emerging UK artists
Hours of live music
Hours of specialist music
Broader range of music than comparable providers, taking into account both number ofplays and size of playlist, in daytime and peak
BBC Radio 5 live
Number of sports with live commentary

Quota

6

7

Notes
1 	 Originations include all BBC commissioned programmes including repeats
2 	 Measured across the 2018 calendar year
3 The BBC Scotland channel launched on 24 February 20194 	First-run originations do not include repeats
5 	 Measured across the two channels
6 41% of additions to the Radio 1 playlist during 2018 came from ‘new and emerging UK artists’
7 17% of additions to the Radio 2 playlist during 2018 came from ‘new and emerging UK artists’

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Purpose Four: To reflect, represent and serve the diverse communities of the United Kingdom’s nations and regions and, in doingso, support the creative economy across the United Kingdom
Note

Network Television
Suitable range of programmes made outside the M25 area
% of hours made in… at a suitable range of production centres
UK (outside the M25 area)
England (outside the M25 area)
Scotland
Wales
Northern Ireland% of expenditure made in… at a suitable range of production centres
UK (outside the M25 area)
England (outside the M25 area)
Scotland
Wales
Northern Ireland
BBC OneHours of news of national or regional interest throughout the day
BBC One and BBC Two
Hours of programmes of national or regional interest (suitable range)% of programmes made in the relevant location
Hours of non-news in peak
Hours of non-news adjacent to peak

Quota

Result

50
30
8
4
2

62
37
17
5
2

50
28
8
5
3

51
28
10
6
3

1
1

1

1

6,300
95
700
280

6,462
99.7
729
315

BBC One Scotland
Hours of news and current affairs
Hours of non-news programmes
A range of genres that reflects Scotland’s culture

290
155

341
215

BBC Two Scotland
Hours of non-news programmes, including Gaelic language output
A range of genres that reflects Scotland’s culture

200

228

BBC One Wales
Hours of news and current affairs
Hours of non-news programmes

275
65

341
130

BBC Two Wales
Hours of non-news programmes

175

200

310
90

377
102

60

166

BBC Parliament
Proceedings of the Scottish Parliament, Northern Ireland Assembly and Welsh Assembly

300

321

Network Radio% of network radio station expenditure outside the M25 area (some referable to Radio 1,
Radio 2, Radio 3, Radio 4 and BBC Radio 5 live)% of Radio 3 expenditure outside the M25 area

33.3
40

39
46

BBC One Wales and BBC Two Wales
A range of genres that reflects Wales’ culture

1,2
1,2
1,2
1,2

4,300
4,761
(2,100 in peak) (2,159 in peak)2

BBC One Northern Ireland
Hours of news and current affairs
Hours of non-news programmes
BBC Two Northern Ireland
Hours of non-news programmes
Irish language programming and Ulster-Scots programming
BBC One Northern Ireland and BBC Two Northern Ireland
A range of genres that reflects Northern Ireland’s culture146

BBC Group Annual Report and Accounts 2018/19

2

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G OV E R N A N C E

Note

Quota

Result

60
100

66
100

95
80
80
70

118
101
101
90

60
100
50

94
100
60

60
100

44
100

BBC Radio Wales% of daytime weekday output that is speech content% of peak breakfast output that is speech content
Weekly hours of news and current affairsContent and music of particular relevance to Wales

60
100
32

67
100
35

BBC Radio Cymru% of daytime weekday output that is speech content% of peak breakfast output that is speech content
Weekly hours of news and current affairsContent and music of particular relevance to Wales

60
100
23

69
100
24

35

42

BBC Online
News and information for the English regions
Coverage of sport for the English regions
News and information for Scotland
Content in Gaelic
Coverage of sport in Scotland
News and information for Wales
Content in Welsh
Coverage of sport for Wales
News and information for Northern Ireland
Content in Irish and Ulster-Scots
Coverage of sport for Northern Ireland
Nations and Regional Services
BBC Scotland
A range of genres that reflects Scotland’s culture
A suitable range of programmes including news

1

BBC ALBA
Live news each weekday evening, including in peak, and a longer news review atweekends
BBC Local Radio% of daytime weekday output that is speech content% of peak breakfast output that is speech content
News and information of particular relevance to the area and communities it serves
throughout the day
Non-news content of particular relevance to the area and communities it serves
Weekly hours of original, locally made programming
BBC Radio Guernsey – Weekly hours of original, locally made programming
BBC Radio Jersey – Weekly hours of original, locally made programming
BBC Radio Somerset – Weekly hours of original, locally made programming

3,4
3,4
3
3
4,5

BBC Radio Scotland% of daytime weekday output that is speech content% of peak breakfast output that is speech content
Weekly hours of news and current affairs
Several regional opt-outs each weekday, offering news, sport and information, and someevening regional opt-out community programmingContent and music of particular relevance to Scotland
BBC Radio nan Gàidheal% of daytime weekday output that is speech content% of peak breakfast output that is speech content
News frequently across the day, particularly in breakfast peak and afternoon peak on
weekdays and peak on weekends
Content and music of particular relevance to Scotland

BBC Radio Ulster
Weekly hours of news and current affairs

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Note

BBC Radio Foyle
Weekly hours of news and current affairs
BBC Radio Ulster and BBC Radio Foyle% of daytime weekday output that is speech content% of peak breakfast output that is speech content
Content and music of particular relevance to Northern Ireland
Hours of indigenous minority language programming, including Irish and Ulster-Scots
output

2
2
2
2

Quota

Result

20

23

60
100

66
100

240

241

Notes
1 	Measured across the 2018 calendar year
2 	 Measured across the two channels/stations
3 	 Applies to each BBC Local Radio station. Each station was compliant with the licence condition
4 Each station was compliant with the licence condition. The figure reported is the average figure across relevant stations
5 Applies to each BBC Local Radio station, except BBC Radio Guernsey, BBC Radio Jersey and BBC Radio Somerset

Other regulatory matters
Changes to the BBC’s UK Public Services
Under the Charter and Agreement, the BBC has to assess whether changes to UK Public Services are material. If the changes arematerial, we are required to carry out a Public Interest Test, which must then be approved by Ofcom before the change can be made.
In 2017, the BBC conducted a Public Interest Test into the new BBC Scotland channel, which the Board approved and submitted to
Ofcom for consideration in November 2017. Ofcom approved the launch of the new channel in June 2018. BBC Scotland was launched in
February 2019.
During 2018/19, we have conducted three detailed materiality assessments of changes to UK Public Services. Of these, the BBC decided
none were material:—

extending the availability of content on BBC iPlayer during 2018/19;—

further developments to BBC Sounds, including aggregating commercial radio and podcasts and offering a limited music streaming
service; and—amending the hours of the newly launched BBC Scotland channel to provide additional time for access services, such as signing.

In November 2018, Ofcom decided that the BBC’s 2018/19 plans for BBC iPlayer were material and directed the BBC to carry out a Public
Interest Test. In January 2019, the BBC published a consultation on its proposals to extend the availability of content on BBC iPlayer. In
April 2019, the BBC approved the BBC iPlayer Public Interest Test and submitted it to Ofcom. Ofcom plans to complete its assessmentand make a final decision by August 2019.
Changes to the BBC’s commercial activities
Under the Charter and Agreement, the BBC has to assess whether changes to its commercial activities are material. During 2018, we
assessed whether the UKTV transaction (the splitting of the business between the BBC and Discovery) was a material change. The BBC
Board concluded that whilst a significant transaction for BBC Studios, this was not a material change.
Regulatory complaints
Under the Agreement between the BBC and the Secretary of State, the BBC is responsible for handling complaints, in a BBC First
approach. This year we have received two complaints regarding competition requirements. In both cases we found that there was nobreach of any of the BBC’s obligations. We received no complaints regarding other non-editorial relevant requirements.
Issue

Service

Date of complaint

Outcome and remedy

Procurement of audiencevoting services

Various12 March 2018

No breach of competition 30 April 2018
requirements

Participation in BARBBARB

29 May 2018

No breach of competition 4 July 2018
requirements

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Date of outcome

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G OV E R N A N C E

Annual Plan Commitments
Under the Charter, the BBC is required to publish an Annual Plan. As part of the Annual Plan, we made 103 public commitments to makethe BBC distinctive. These commitments mainly relate to specific events or outcomes on our services that occurred over 2018/19.
PurposeBBC commitment

Achieved

BBC One will continue to broadcast a demonstrably broader range of genres in peaktime than any comparable channel

YES

BBC One will showcase a wide range of content from across the UK including: threemajor dramas from BBC WalesYES

BBC One will broadcast at least 15 new drama titles during the year (subject to delivery
timing)

YES – 19

BBC One will showcase a wide range of content from across the UK including: fresh
format development and more local comedy and drama from Northern Ireland

YES

BBC One will showcase a wide range of content from across the UK including: new andreturning series from Scotland

YES

BBC One will aim to be the channel that reaches the most 16-34 year-olds

YES

BBC One will aim to reach more than half of BAME audiences each week

BBC One reached51.3% of BAME
audiences on average
across the year

A mix of different
genres and output

BBC Two will broadcast at least 50 hours of arts and music in peak time

YES – 69

Creative ambition

BBC Two will bring four new factual formats to the channel

YES – 5

BBC Two will bring three new comedy or comedy entertainment shows to the channel

YES – 3A mix of different
genres and output

BBC Three will commission substantial scripted content – including aiming tocommission at least five long-form comedies, subject to delivery timing

YES – 11UK original output

More than 90% of long-form commissions will be UK originations

YES – 98%

Range of audiences

BBC Three will aim to reach 5-10% of 16-34s a week (using a four-weekly average)

YES – 8%UK original output

BBC Four will broadcast at least 60 hours of originated factual programmes this year

YES – 106

Creative ambition

BBC Four will expand its international remit with at least three new factual acquisitions
giving insight into global history and culture

YES – 3

BBC OneA mix of different
genres and output

Creative ambition

Range of audiences

BBC Two

BBC Three

BBC FourCBBC
A mix of different
genres and output

Broadcast a broader range of genres than other children’s television channels

YES

CBBC will build on its commitment to deliver regular news on CBBC by promoting
engagement through a new Newsround website

YES

Creative ambition

Support the mental health and wellbeing of UK children with specifically commissioned
programmes on CBBC and the online offer Own It to help pre-teens develop theirconfidence and resilience online

YES

Range of audiences

Reflect the diversity of UK children to ensure everyone sees themselves and their lives
represented on screen

YES

A mix of different
genres and output

Broadcast a broader range of genres than other children’s television channels

YES

Creative ambition

CBeebies will build on its support for early years development with the launch of newlearning and creativity apps

YES

Range of audiences

Reflect the diversity of UK children to ensure everyone sees themselves and their lives
represented on screen

YES

CBeebies

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PurposeBBC commitment

Achieved

A mix of different
genres and output

We will continue our commitment to daily in-depth sports news

YES

Range of audiences

It will be the UK news channel with the biggest reach

YES

Brexit will continue to dominate Chamber coverage, with the main action moving
between Commons and Lords, as well as in Committee and the European Parliament.
The Speaker’s Lecture series will focus on this with six of the most prominent politicalvoices speaking on the subject, over the first half of the year

YES

We will continue our commitment to cover European Parliamentary institutions

YES – 126 hours

The centenary of women’s suffrage will be examined through the parliamentary historyof the campaign in a documentary on the MPs who fought to extend the vote. The
Speaker’s Lecture series in the second half of the year will develop the theme in the
direction of present-day equality issues and political campaigns

YES

BBC ALBA will celebrate its 10th anniversary and will launch a new weekend news
offering, as well as playing a key supply role to the new BBC Scotland channel

The BBC Scotland
channel launched in
February. BBC ALBA
will supply
programming during
2019/20

We will measure the overlap of the 100 most played songs on Radio 1 and key
commercial stations each month to ensure we continue offering a distinct music mix

YES – see note 1

Documentaries will focus primarily on the key challenges faced by young adults growing
up in the UK today and aim to stimulate wider conversations as part of our Sunday
afternoon Life Hacks programme

YES

We will report on the range and depth of support for new music on Radio 1 and Radio 2
through analysis of their respective published playlists; and compare performanceagainst the playlists of key commercial stations

YES – see note 2

UK original output

Radio 1’s playlist will showcase the UK’s most exciting new music, with extensive
support for acts still to enjoy significant chart success. The Brit List in particular willoffer a continuing commitment to emerging artists across the year

YES

Creative ambition

We will experiment with new podcast formats, including a number designed to offer
opportunities for up-and-coming comedians

YES

As part of BBC Music’s ‘Biggest Weekend’, Radio 1 will head to Wales with a two-day
celebration of live music in Swansea

YES

Social action content will tackle issues around debt and sex and consent

YES

Radio 1 will maintain an editorial focus on its key audience of listeners aged 15-29

YES

A mix of different
genres and output

We will continue developing the 1Xtra Talks brand, aiming to establish it in the minds oflisteners as a home for documentaries and in-depth discussion that tackles key issues
affecting young people in the UK today

YES

UK original output

1Xtra acts as a champion for new UK artists who get little mainstream media support.
In daytime, at least 35% of the music will come from UK artists, with an intention thatat least 50% of this will be ‘new’

YES

Creative ambition

We are looking to build partnerships with community radio stations around the UK andwill showcase some of the most exciting new DJs we find in a series of late-nightspecialist shows

YES

Range of audiences

1Xtra’s programmes are designed with young adults in mind, aiming in particular to
appeal to underserved BAME audiences

YES

BBC News

BBC Parliament
A mix of different
genres and output

UK original output

BBC ALBA
A mix of different
genres and output

Radio 1
A mix of different
genres and output

Range of audiences
1Xtra

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PurposeBBC commitment

Achieved

We will measure the overlap of the 100 most played songs on Radio 2 and key
commercial stations each month to ensure we continue offering a distinct music mix

YES – see note 3Radio 2 will play a more distinctive mix of music than comparable providers, with a
daytime playlist which features a greater range of songs

YES – see note 4Radio 2 will broadcast a broad mix of genres and programming, including the Arts Show,
500 Words as well as specialist music output from jazz, folk, blues and soul to the
popular Sounds of the 80s on the Red Button

YES

UK original output

Radio 2 will act as a showcase for new and heritage UK artists as well as BBC
Introducing artists

YES

Creative ambition

Radio 2 will continue to be a champion of new and heritage artists, with a variety of live
events around the UK, such as Radio 2 in Hyde Park, BBC Young Brass Final in
Manchester, Radio 2 Folk Awards in Belfast, the Cheltenham Jazz Festival and the
Edinburgh Festival

YES

As part of BBC Music’s ‘Biggest Weekend’, Radio 2 will head around the UK with a
two-day celebration of live music in Perth and Coventry

YES

Radio 2 will maintain its editorial focus on listeners aged over 35

YESRadio 3 will renew its commitment to putting cultural range at the heart of its offer.
This includes relaunching its late-night speech and cutting-edge music zone

YES

Radio 3 will renew its commitment to putting cultural range at the heart of its offer.
This includes an expansion of its commitment to ‘slow radio’

YESRadio 3 will renew its commitment to putting cultural range at the heart of its offer.
This includes newly commissioned formats for world music and jazz programmes

YES

Radio 3 will maintain its role in unique and challenging drama

YES

UK original output

Radio 3 will continue to promote new talent – whether through New Generation Artists,
New Generation Thinkers or BBC Introducing. Plans will be developed for a returning
on-air season highlighting young talent

YES

Creative ambition

Radio 3 will broadcast major seasons to mark key classical music anniversaries including
150 years since the death of Claude Debussy, the centenary of Gustav Holst’s The
Planets, 100 years since the birth of Leonard Bernstein and 40 years of BBC’s Young
Musician. Late-night specials will explore Japanese music and culture, and a major
returning strand across the summer, autumn and winter will showcase how forests havebeen at the centre of the human imagination and great music and art

YESRadio 2A mix of different
genres and output

Range of audiences
Radio 3A mix of different
genres and output

Radio 4 and BBC 4 Extra
A mix of different
genres and output

Creative ambition

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Radio 4 will continue to support and promote new writing in its drama and comedy, as
well as delivering the third series of the striking innovative drama serial Tracks and otherdigital-first projects

YES

It will introduce a new run of stand-up comedy to Sunday evenings and continue to be
the home of the BBC New Comedy AwardYES

We will make over 600 hours of drama for Radio 4 and iPlayer Radio combined

600

We will make 180 hours of comedy for Radio 4 and iPlayer Radio combined

YES – 248

Radio 4 will continue to provide insight through its Brexit for the Perplexed brandYES

We will broadcast 55 hours of comedy each week on Radio 4 Extra

YES – 62

We will broadcast 55 hours of drama each week on Radio 4 Extra

YES – 64

Radio 4 Extra will continue its commitment to drama and comedy archive, as well as
selecting from the best new speech audio and podcasts. It will continue to offer new
comedy to younger listeners through its Newsjack franchise

YES

Radio 4 will continue to produce significant landmark content to mark major events andanniversaries, which this year will include the Suffrage and Armistice centenaries, a
20-part series on key Chinese figures and a history of the NHSYESBBC Group Annual Report and Accounts 2018/19

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PurposeBBC commitment

Achieved

BBC Radio 5 live and 5 live sports extra
A mix of different
genres and output

A broader range of sports on 5 live and 5 live sports extra than on any comparable
service, including the World Cup, Ryder Cup and European Championships (multi sports)
in Glasgow and Berlin

YES

5 live will continue to tell the story of the UK’s journey to Brexit through accessible andentertaining politics programmes such as Question Time Extra Time, The Emma Barnett
Show, Pienaar’s Politics and the Brexitcast podcast

YES

UK original output

5 live will showcase voices from around the UK through our daily phone-in Your Call,and through shows such as 5 live Breakfast and Afternoon Edition going on the roaddelivering outside broadcasts

YES

Creative ambition

5 live will broadcast regular seasons shining a light on key issues such as mental health,homelessness and parenting. It will continue to innovate its content mix with a range of
new podcasts including a fitness show aimed at women, a new arts programme and asports archive show

YES

Range of audiences

5 live will continue to review its schedules, talent and on-air contributors to reflect thediversity of the UK

YES

5 live sports extra aims to grow younger audiences through a range of magazine showsin addition to live sport (subject to regulatory approval)

This is an ongoing
ambition. In 2018/19
we expanded ourrange of sports
magazine podcasts

At least 30% of music in daytime will be new

YES

300 live music sessions

YES – 316

6 Music will provide a mix of specialist music programmes and documentaries, including
a season on New York, hip hop and house music

YES

6 Music remains committed to championing new and alternative music from the UK andbeyondYES

6 Music will champion grassroots UK venues via its output including live events such as
the Biggest Weekend and Indie Venues Week

YES

6 Music will explore the arts with a number of series focusing on film, literature and thevisual arts as well as the Art is Everywhere season, during which audiences will be
inspired to make and share art of their own

YES

6 Music will continue to develop its pioneering role as a curator of music, seeking
greater diversity and a more even gender balance within its schedule and standout
editorial seasons such as 3 Wise Women

YES

6 Music will showcase a range of landmarks and events including celebrations of theSecond Summer of Love, a tour of UK independent venues and events such as The
Great Escape Festival, the Cheltenham Jazz Festival and SXSWYES

A mix of different
genres and output

We will introduce a new late-night topical discussion show that focuses on key issues
affecting young Asians in the UK today

YES

UK original output

The station will continue to act as a showcase for the British Asian Sound, with aminimum 30% of the music in daytime coming from UK artists

YES

Creative ambition

Following four successful Asian Network Comedy nights across the UK in 2017, we plan
to showcase more up-and-coming comedians with a second series of shows in 2018

YES

Range of audiences

The station will offer a broad mix of music and speech programming designed primarily
to entertain and engage young British Asian audiences

YES

BBC 6 MusicA mix of different
genres and output

UK original output

Creative ambition

BBC Asian Network

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PurposeBBC commitment

Achieved

As Radio Scotland celebrates its 40th anniversary on air, the multi-award-winning
Breaking the News will return and spearhead output at both The Glasgow International
Comedy Festival and The Edinburgh Festival Fringe

YES

Cross-collaboration with Entertainment will work towards developing a full multi
platform offering of the show

YES

The station will offer weekday localised news bulletins from Aberdeen, Inverness,
Selkirk and Dumfries

YES

News and community programmes will be offered as opt-outs in Orkney and Shetland

YES

Key local role in showcasing the Biggest Weekend Music Day 2018

YES

A mix of different
genres and output

In April, Radio Wales launches a brand new monthly arts review programme. It will bepresented by Gary Raymond, the editor of the Wales Arts Review

YES

UK original output

Biggest Weekend Music Day 2018 (May 2018) – pan-UK celebration of music live in
Swansea’s Singleton ParkYES

A number of new comedy writing initiatives and pilots are in flight. The focal point ofthese initiatives is a new BBC Wales scheme to find and develop the best writers –‘Find me Funny’YES

We will launch a new breakfast show on Radio Cymru 2 (available on digital radio). The
service will provide music and programming and real choice to new and existing Radio
Cymru listeners alongside its existing news offer at breakfast peakYES

BBC Radio Scotland
A mix of different
genres and output

UK original output

Creative ambition
BBC Radio Wales

BBC Radio Cymru
UK original output

BBC Radio Ulster and BBC Radio Foyle
A mix of different
genres and output

Create new platforms for the development of new comedy talent

YES

New factual series including on natural history and local food

YES

UK original output

Fully support and locally enhance the Year of Music 2018; beginning with the hosting of
the BBC Radio 2 Folk Awards in Belfast in April (which will be simulcast on Radio Ulster/
Foyle), then the Big Weekend Music Day at the Titanic’s Slipway in Belfast

YES

Range of audiences

Focus on talent and contributor refreshment with particular emphasis on ensuring
diversity of voices across the station

YES

Increase and refresh minority language output including a new Ulster-Scots magazine
programme

YES

A mix of different
genres and output

Local Radio will broadcast a BBC Introducing programme in each station’s schedule tooffer more opportunities to new talent

YES

UK original output

Local Radio will test more formats for showcasing up-and-coming comedy talent acrossa number of stations

YES

Range of audiences

All Local Radio stations will provide output that is rooted in faith and ethics on
Sunday mornings

YES

BBC Local Radio

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PurposeBBC commitment

Achieved

We will continue to offer audiences a wide range of content across all of our products,
giving them more choice over what and how they consume BBC content online

YES

This year we will enhance BBC News and BBC Sport Northern Ireland, providing greater
consistency, increased depth of coverage including increased social media presence

YES

We will continue to provide links to external stories provided by local and regional news
providers within our Local News product

YES

Where appropriate, we will support wider industry by hosting or signposting to theircontent. We are in the process of reviewing and updating our published policy aroundlinking to external sites, to ensure it is fit for purpose and supports the best user
experience online

YES – see https://www.bbc.co.uk/
editorialguidelines/
guidance/feeds-andlinks

We will launch a refreshed version of our digital audio product – giving audiences ahighly personalised content offer across all our audio output and an improved browsing
and content discovery experience

YES

BBC Online will expand the interactive digital capabilities, content and experiences
available to children. We will launch new apps that enable pre-school audiences tocreate and learn as well as collaboration and content creation apps for older pre-teens

YES

We will capitalise on the success of The Social, rolling out across the BBC in 2018/19,
with more short-form films and development of online drama such as The Grey Area

YES

We will continue to use sign-in data collected from our audience to personalise our offer
across our digital products, surfacing the best content that is most relevant to them

YES

We will continue to lead the way in developing what public service broadcasting looks
and feels like online, with curation and recommendations that inform, educate andentertain

YES

BBC Online
A mix of different
genres and output

UK original output

Creative ambition

Range of audiences

Notes
1	Across 2018/19, the average monthly overlap between the Top 100 most played songs on Radio 1 and Top 100 most played songs on: Capital London was 31; Kiss was 37;
and Radio X was seven.
2	343 tracks were added to the Radio 1 playlist during 2018, with Radio 2 adding 319 – a wider variety than either Capital (139) or Heart (41).
3	Across 2018/19, the average monthly overlap between the Top 100 most played songs on Radio 2 and Top 100 most played songs on: Heart London was 12; Magic was eight;
and Smooth was two.
4	Radio 2 played 9,365 different tracks between 06:00 and 19:00 during 2018. This compares to 704 different tracks on Heart, 1,214 on Magic, and 801 on Smooth.

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General Duties
The Charter sets out a number of General Duties that apply to the BBC. This section sets out the BBC’s progress against its General
Duties – the measures for reporting were set out in the BBC Annual Plan for 2018/19.
1. Acting in the public interest
The BBC must act in the public interest, aiming to serve its audiences not just as consumers, but as members of a wider society, with
programmes and services which, while seeking to inform, educate and entertain audiences, also serve wider public purposes. As a result,the BBC must ensure that the benefits (whether direct or indirect) of decisions relating to the mission or purposes outweigh the costs(whether direct or indirect); and have regard to economic, social and cultural benefits and costs.
MeasureAchieved

We will publish an Annual Plan and an Annual Report

YES

We will publish the number of complaints upheld where we have failed to comply with theBBC’s obligations under the Charter and Agreement or with the Ofcom Operating
Framework or World Service Licence

YES – see Other Regulatory Matters

We will publish the number of complaints upheld on BBC editorial matters and overall
volumes of complaints madeYES – see Editorial Guidelines and Standard
ReportWe will publish performance measurement data, including data on the fulfilment of the
public purposes, as described in previous chapters

YES – see Delivering the Public Purposes

2. Engagement with the public
The BBC must assess the views and interests of the public and audiences, including licence fee payers, across the whole of the United
Kingdom. The BBC must make arrangements to ensure that the diverse perspectives and interests of the public and audiences, including
licence fee payers, across the whole of the United Kingdom are taken into account in its decision-making.
MeasureAchieved

We will publish annually data on audiences’ views about the BBC as part of theAnnual Report

YES – see Delivering the Public Purposes

We will hold around six face-to-face events with audiences and report on thefindings in the BBC’s Annual Report, four of which will be delivered by the Board’s
Nations Committees

YES – see Audience Engagement Report

3. Market impact
The BBC plays a crucial role in the UK media and broadcasting market. In addition to serving audiences directly by providing content andservices, it can contribute to the market more broadly, for example by promoting competition, supporting supply chains and encouraging
sector-wide innovation. The BBC must have particular regard to the effects of its activities on competition in the UK. In complying withthis duty the BBC must (a) seek to avoid unnecessary adverse effects on competition and (b) promote positive market impact.
MeasureAchieved

We will publish and consult on any planned material changes

YES – see https://www.bbc.com/
aboutthebbc/reports/consultation/
iplayerpit

We will publish annually the number of regulatory complaints upheld and actions taken in
response

YES – see Other Regulatory Matters

We will publish the number of Ofcom enforcement actions in relation to compliance with
the Ofcom Operating Framework in this area

YES – none

We will publish the outcomes of any Public Interest Tests

YES – we did not conclude any Public
Interest Tests in 2018/19. We published theoutcome of the BBC iPlayer Public Interest
Test in April 2019

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4. Openness, transparency and accountability
The BBC must observe high standards of openness and seek to maximise transparency and accountability. It must publish Board
minutes, important decisions concerning changes to remit/services, and minutes of Committee meetings. The Board also needs to haveregard to the benefits of consultation with interested persons.
MeasureAchieved

We will publish an Annual Plan that sets out the BBC’s strategic priorities, creative plans,budget and any planned material changes to services

YES – see http://downloads.bbc.co.uk/
aboutthebbc/reports/annualplan/annualplan_2019-20.pdf

We will publish the following after the relevant event:

YES – see https://www.bbc.com/
aboutthebbc—

Minutes of the meetings of the Board—

Important decisions concerning changes to the creative remit, work plan and materialchanges to the UK Public Services, non-service activities and commercial activities—

Summary minutes of the meetings of committees of the Board

We will publish an Annual Report and Accounts, containing a detailed summary of
performance against our regulatory quotas; full financial details and accounts; andinformation required as part of our Equality Information Report

YES

We will continue to publish the salary disclosures required under the Charter relating to
pay over £150,000, along with our voluntary regime of quarterly salary and expenses
disclosure for senior managers

YES – see Remuneration Report

We will continue to publish data, as required, relating to our gender pay gap

YES

We will publish data showing how the promotion of any output of a UK Public Service
focuses on output contributing substantially to the fulfilment of the Mission andpromotion of the Public Purposes

YES – see Public Service Promotions

We will publish updated transfer pricing methodologies for all commercial subsidiaries by
the end of 2018

YES – we published methodologies in April
2018 and have published updated
methodologies alongside this report in linewith Ofcom’s new requirements

5. Partnership
The BBC will work collaboratively and in partnership, especially in the creative economy, in the public interest. It should partner with awide range of organisations of all sizes, including commercial and non-commercial, throughout the UK. Partnerships should be fair andbeneficial to all with due attribution and recognition for partners.
MeasureAchieved

We will collect and publish performance data on key partnership output and activities,
including on the BBC’s range of partnerships, range of partners, geographical breadth,and impact

YES

6. Diversity
The BBC must ensure it reflects the diverse communities of the whole of the United Kingdom through its output, the means by which its
output and services are delivered, and in the organisation and management of the BBC. This includes support for the regional andminority languages of the UK.
MeasureAchieved

We will publish detailed diversity data for all our staff, including on socio-economic
background, as part of our annual Equality Information Report

YES – see Equality Information Report

We will continue to monitor and update our progress against our diversity strategy,reporting on this on our website

YES – see https://www.bbc.co.uk/diversity/
strategy

We will continue to publish gender pay gap information, and analysis of our pay gaps forother groups

YES – see https://www.bbc.com/
aboutthebbc/reports/reports

We will also publish performance measurement data collected on the fulfilment of our
fourth public purpose

YES – see Delivering the Public Purposes

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7. Technology
The BBC must promote technological innovation, and maintain a leading role in research and development. To do this, it needs to seek towork in partnership with other organisations and share, as far as is reasonable, its research and development knowledge andtechnologies.
MeasureAchieved

We will continue to invest in the BBC’s Research and Development (R&D) department inline with the BBC’s long-term objectives

YES

We will continue to share our insights from R&D. We will use our web and social presence
to highlight key messages to a wider audience

YES – see https://www.bbc.co.uk/rd

We will increase our investment in long-term innovation

YES

We track our innovation activity (e.g. projects and prototypes) annually and undertake
regular reviews (e.g. every 5-10 years) of the long-term value created from our investment

YES – we published a review into our R&D
activity in 2018, and are preparing data for
a future review

8. Stewardship of public money
The BBC exercises rigorous stewardship of public money in accordance with the following principles:—

Regularity – Management of all of the BBC’s resources must accord with the provisions of the Charter, Framework Agreement andother agreements the BBC enters into with Government Ministers—

Propriety – Management of all of the BBC’s resources must meet high standards of public conduct, robust governance and duly
consider the expectations of Parliament (including those of the Public Accounts Committee), which have been formallycommunicated to the BBC—

Value for money – Procurement, projects and processes must be systematically evaluated and assessed to provide confidence about
the economy, effectiveness and efficiency of the project, taking into account the wider public interest, not just that of the BBC itself—

Feasibility – Proposals using public funds should be implemented accurately, sustainably and to the intended timetable

MeasureAchieved

True and Fair statutory accounts prepared in line with IFRS, based on unqualified audit
opinion from the BBC’s external auditors

YES

We will report on our mechanisms for provision of information to the Board and the Audit
and Risk Committee on compliance with the Charter, to ensure that the transactions
reflected in the BBC’s financial statements have been applied to the purposes as intended
and conform to the relevant frameworks governing them.

YES – subject to the position on regularity
set out in the Chief Financial Officer’s
statement on page 88.

We will seek to receive a propriety opinion from the BBC’s independent external auditors
to ensure that the management of the BBC’s resources has met high standards of public
conduct

YES

We will comply with funding conditions as part of a separate funding agreement, e.g. grantfunding for the BBC World Service

YES

Our response to Value for Money reviews conducted by the NAO or other commissioned
partiesYES

9. Guidance and best practice
The BBC has to have regard to general guidance concerning the management of the affairs of public bodies and generally accepted
principles of good corporate governance, where applicable and appropriate.
MeasureAchieved

We will audit our compliance with the UK Corporate Governance Code and principles ofgood corporate governance based on a general aim of compliance with the Code wherever
possible

YES – see Governance

Our Annual Report will set out the BBC’s performance against the Code; areas where theCode does not apply to the BBC; areas where the Charter overrides the Code; and areas
where the BBC does not comply

YES – see Governance

We will also publish an annual Equality Information Report, in compliance with the Public
Sector Equality Duty

YES – see Equality Information Report

An annual statement on licence fee collection will be audited by the NAO and laid before
Parliament

YES

We will publish data on our gender pay gap, in line with relevant legislation

YES – see https://www.bbc.com/
aboutthebbc/reports/reports

We will continue to comply with best practice in offering training on a range of issues suchas anti-bribery, data protection and child protection

YES

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10. General duties in relation to commercial activities
The BBC’s commercial activities need to act in the public interest, engage with the public, and ensure openness and transparency. They
must not distort the market nor gain an unfair competitive advantage.
MeasureAchieved

The Board Fair Trading Committee will continue to: keep under review the BBC’s
compliance with Ofcom’s trading and separation requirements; commission an annual
independent audit; review, consider and approve the BBC’s transfer pricing methodologies;
report progress in the BBC’s Annual Report; and review the ongoing compliance of thecommercial activities with the four commercial criteria

YES

We will abide by our published policy on material changes to commercial activities

YES

We will publish forthcoming potential material changes to commercial services in the
BBC’s Annual Plan, subject to issues of commercial confidentiality

YES

We will carry out the commercial test for any proposed material change to our commercial
activities, and publish the proposed change once we have done so

YES

We will publish transfer pricing methodologies concerning our commercial subsidiaries, as
required under Ofcom’s Operating Framework

YES

We will continue to train key staff on compliance with the Fair Trading rules

YES

We will continue to meet our publication and information provision obligations to Ofcom,
detailing the financial performance of our commercial subsidiaries and setting out
detailed methodologies for transfer pricing within our group

YES

We will conduct a periodic review of our commercial activities by the end of 2018

YES – see http://downloads.bbc.co.uk/
aboutthebbc/insidethebbc/howwework/
reports/pdf/commercial_review_2018.pdf

We will publish the number of upheld complaints about compliance with the commercial
activities requirements under the Charter and Agreement or in the Ofcom Operating
Framework, and our response to such complaints

YES – None

We will publish the number of Ofcom enforcement actions in relation to compliance with
the Ofcom Operating Framework in this area

YES – None

The Fair Trading Committee will report annually on its work in the Annual Reportand Accounts

YES – see Fair Trading Report

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Partnerships and collaboration
The BBC has a duty to work collaboratively
in partnership with other organisations in
the national interest. We cannot do thiswithout the help, support and contributionof a vast array of partners, experts andcontributors. A snapshot review of 2018/19
found that the BBC had 300 partnerships
and collaborations, large and small, focusedon public service activity that supports thecreative economy right across the UK.

In 2018, the World War One partnerships
with the Imperial War Museums (IWM)
and 1418NOW came to a close. One of
the most successful projects was thePeter Jackson film They Shall Not Grow
Old which attracted an audience ofnearly 4 million. We have agreed that
our successful partnership with IWM
will continue as we approach significant
World War Two anniversaries in 2019/20.

Our partnerships vary in size, scale andobjective; the case studies below highlightsome of our key 2018/19 outcomes,
focusing on tackling fake news, deepening
our commitment to science and history,
finding new ways to engage audiences, anddeveloping what we do across the UK.

Creative relationships to engage newaudiences
We are also developing innovative
partnerships in a variety of ways toengage and educate new audiences.

Tackling fake news
This year we grew our successful
Local Democracy Reporting Service,a key partnership with more than 100
media organisations, built around ashared research unit and a news hub,distributing more than 78,000 stories
already with over 130 reporters in post.
The scheme was recognised this yearby the Culture Secretary as a “shining
example of what can be done” and wewill continue to grow it this year.
We also partnered with the DG7 group of
global public service broadcasters, hosting
their annual conference in December which
considered issues of joint interest suchas media freedom and journalist safety.
A focus on science and history
Our inspirational Tomorrow’s World
campaign came to an end in June however
the main partners, Wellcome, Open
University, Royal Society and Science
Museum Group, continue to meet withcommissioners across the BBC to share
information regarding forward plans,
including those for an ambitious 20-partseries on Radio 4 and exhibition at The
Science Museum, The Art of Innovation.
As part of its final initiative in May, theTomorrow’s World team launched anenquiry into GDPR awareness on theOpen University’s citizen science platform
nQuire. The platform is now being usedby a number of BBC teams, working withdifferent academics, on projects such as:—

the Forest 404 experiment, designedwith Exeter and Bristol Universities toaccompany the Radio 4 podcast drama
and including 6,000 participants.

—

the Feel Good Test, designed with UCL
and launched as part of the Get
Creative season, with 40,000
participants so far.

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—

—

—

—

Our long-standing partnership with
the Open University celebrated its
50th anniversary this year with a seriesof major TV commissions and an
extension into factual digital content.
This spring, schoolchildren from
London’s East End took on thechallenge of painting a picture in audio,
inspired by the poem Under Milk Wood.
They worked with the writing/mentoring centre Ministry of Stories on
text creation, with production support
from the BBC. Their final poem, Round
About Candle Street, was showcased
live on BBC London.

Our strategic partnership with the BFI
has been extended to reflect our sharedinterest in film and film culture. It now
covers talent development, co-funding
discussions, film marketing support andwindowing, as well as continuing to work on
pan-BBC seasons and screenings together.
Meanwhile, BBC Arts is working withnine cultural organisations and funders
across the UK to deliver three new talentdevelopment projects: New Creatives(England), Now and Next (Scotland), Two
Minute Masterpieces (NI) and a schemein Wales due to launch in 2019. While
Super Movers, our partnership with thePremier League and Scottish PFL, inspires
schoolchildren to become more active.
We also continue to broaden our archive
partnerships working with the British
Library, National Archives, National Libraryof Wales, Libraries NI, National Media
Museum and others to open up accessto our vast array of archive content.
BBC partnerships and collaborations:a snapshot in 2018/19
The table below presents the main
collaborations and creative partnerships
across the BBC.

BBC History also worked with Art UKand the homeless charity Accumulate;artist Sadie Edgington explored thesculpture collection at Broadcasting
House with participants who thenproduced their own original sculptures.

BBC area

No. ofpartnerships/
collaborations

Archive

9Arts/Arts North

25

Academy (Birmingham)

15

Childrens (Salford)4

As part of the Dementia Partnership,
the BBC developed a digital tool using
its archive. BBC Music Memories helps
users build playlists of personally
meaningful music for use inreminiscence therapy.

Content/TV

15

Learning (Salford)

53

Sport (Salford)

12

Agile and flexible partnerships acrossthe UK
This year short-term partnerships havebeen important in supporting our big
Factual seasons such as Plastics Watch,where we worked with a wide range oforganisations including Surfers Against
Sewage, the Marine Conservation
Society and the Women’s Institute; Icons(National Portrait Gallery, Google Arts andCulture, Tate, British Library and others);
and our mental health season (working
with the Mental Health Foundation,
Public Health England, Libraries
Connected and the Reading Agency).

News

5

Music

23

Radio

64

R&D

22

England Network Centres

16

Scotland

10

Wales

20

Northern Ireland
Total

7
300

This data includes programme making divisions, R&D
and Training in network production centres across the
UK. It does not record the activities of individual local
radio stations.

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Access services
The following table reports on the prevalence of access services across the BBC’s television channels and on BBC iPlayer.
Audio
Audio described hours

Total hours

Actual for year (%)

Target for year (%)

2018/192017/18

2018/192018/192017/18

2018/192017/18

BBC One
BBC Two
BBC Four
CBBC
CBeebies
BBC Scotland1

1,925
2,644
1,419
1,995
1,447
50

1,966
2,526
1,257
1,850
1,443
N/A

8,736
8,736
3,178
5,090
4,700
175

22.0
30.3
44.6
39.2
30.8
28.3

22.5
28.9
39.7
36.4
30.7
N/A

20.0
20.0
20.0
20.0
20.0
20.0

20.0
20.0
20.0
20.0
20.0
N/A

Linear total

9,480

9,042

30,615BBC iPlayer2

8,826

N/A

55,9693

15.8

N/A

N/A

N/A

Sign interpreted
Sign interpreted hours

Total hours

Actual for year (%)

Target for year (%)

2018/192017/18

2018/192018/192017/18

2018/192017/18

BBC One
BBC Two
BBC Four
CBBC
CBeebies
BBC Scotland4
BBC News

458
459
202
270
252
0
507

462
458
198
297
253
N/A
506

8,736
8,736
3,178
5,090
4,700
175
8,736

5.2
5.3
6.4
5.3
5.4
0.0
5.8

5.3
5.2
6.2
5.8
5.4
N/A
5.8

5.0
5.0
5.0
5.0
5.0
5.0
5.0

5.0
5.0
5.0
5.0
5.0
N/A
5.0

Linear total

2,148

2,174

39,351

BBC iPlayer2

2,612

N/A

55,9693

4.7

N/A

N/A

N/A

Subtitled
Subtitled hours

Total hours

Actual for year (%)

Target for year (%)

2018/192017/18

2018/192018/192017/18

2018/192017/18

14,354
9,492
3,178
5,089
4,699
175
8,736
1,629

14,268
9,542
3,165
5,080
4,704
N/A
8,733
1,390

14,364
9,503
3,178
5,090
4,700
175
8,736
8,736

99.9
99.9
100
100
100
100
100
18.6

99.9
99.9
100
100
100
N/A
100
15.9

100
100
100
100
100
100
100
N/A

100
100
100
100
100
N/A
100
N/A

Linear total

47,352

46,88254,482

BBC iPlayer2

51,533

N/A

67,407

76.5

N/A

N/A

N/A

BBC One
BBC Two
BBC Four
CBBC
CBeebies
BBC Scotland
BBC News
BBC Parliament

Notes
1 BBC Scotland launched on 24 February 2019.
2 Figures are for the number of programmes available on BBC iPlayer. S4C and World Service content is not included. For the five main broadcast channels, including nations andregional variants, 100% of content is subtitled, 20% audio described and 5% signed. This content including subtitles, audio description and signed versions is all made available
on iPlayer, and we achieve the same levels for BBC Three programmes that are broadcast. iPlayer aggregates those main broadcast channels and other channels for which lower
levels of access services are provided, so the overall figures for iPlayer are at a lower level than the main broadcast channels.
3 The total number of programmes here excludes audio described and signed versions. These versions are included in the subtitled figures.
4 Following discussions with Ofcom over scheduling, BBC Scotland began to broadcast signed programming on 29 April 2019.

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Contestability
Under the Agreement between the BBC and the Secretary of State, the BBC must secure competition between BBC producers andexternal producers, whether independent producers or not, for production of television, radio and online content. More information oncontestability in television can be found in the TV Supply Report, published in May 2019.
As required under the BBC Agreement, we have ensured that, for relevant television programmes, 40% of the previous in-houseguarantee for drama, comedy, entertainment and factual has been opened up to competition. Also in line with the Agreement, we haveremoved the in-house guarantee for children’s and non-news related current affairs programmes.

TV1—

Drama, comedy,
entertainment andfactual in-houseguarantee

Target (% of relevant hours)% of hours contested

Target date

Achieved

100562

31 Dec 2027

In progress

40

433

31 Dec 2018

Yes

Network radio4

60

355

31 Dec 2022

In progress

Online material6

100

44 (% of relevant spend
was external)7

31 Dec 2027

In progress

Notes
1 The BBC Agreement requires the BBC to ensure that, for relevant television programmes, at least 40% of the previous in-house guarantee for drama, comedy, entertainment
and factual is opened up to competition by 31 December 2018; and to secure competition for 100% of relevant television programmes by 31 December 2027. The BBC is also
required to remove the in-house guarantee for children’s, sport and non-news related current affairs programmes by 31 December 2019.
2 This figure is based on the number of hours broadcast in the 2018 calendar year, taking into account commissioning decisions made up to the end of December 2018.
3 Methodology for this figure was published alongside the TV Supply Report in May 2019.
4 The BBC Agreement requires the BBC to ensure that, for relevant radio programmes, it secures competition for at least 60% of relevant broadcasting time by 31 December
2022. Relevant radio programmes means all network radio programmes included in the UK Public Services except (a) news programmes; and (b) repeats, continuity, simulcasts,
EBU material and autoplayed music.
5 This figure is based on the number of hours broadcast in 2018/19, taking into account commissioning decisions made up to the end of March 2019.
6 The BBC Agreement requires the BBC to secure competition for 100% of relevant online material by the end of 2027. Relevant online material is all online material includedin the UK Public Services except: (a) programmes included in the UK Public On Demand Programme Services; (b) news and news-related current affairs material; and (c) any
material where the BBC considers that complying with the obligation would not secure value for money.
7 We have used external spend as a proxy in this year’s reporting, and will continue to develop our approach to reporting contested spend on relevant online material.

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Network television supply
The following table shows the proportion of BBC network television hours levels produced by different supplier types.
Proportion of all hours produced byqualifying independent
producers for BBC television (%)

Proportion of all hours produced by
non-qualifying independent
producers for BBC television (%)

Proportion of all hours produced by
PSB in-housefor BBC television (%)

Proportion of all hours produced by
BBC Studios
for BBC television (%)

2018/192017/18% pointchange

Drama

14

25

-11

18

Entertainment

30

26

+4

38

Comedy

39

39

0

25

20

+5

0

0

0

35

41

-5

Factual

35

30

+4

18

11

+6

4

5

-1

43

53

-10

2018/19% pointchange2018/192017/18% pointchange2018/19

19

-1

0

0

0

40

-2

0

0

0

2017/18

2017/18% pointchange

68

56

+11

32

34

-2

Daytime

39

40

-1

29

27

+2

0

0

0

33

33

0

Sport

29

23

+6

0

0

0

71

77

-6

0

0

0

Children’s

28

35

-8

14

19

-5

55

45

+1

3

1

+2

Total

32

31

+1

18

17

+2

22

23

-1

28

30

-2

Figures are based on qualifying programmes (as defined in the Independent Productions Order) delivered within each financial year. This means they exclude repeats andacquisitions. Data includes only network hours delivered within the relevant year.

Network radio supply
The following table shows the levels of all BBC network radio hours from different suppliers.
Proportion of all hours produced byindependent producers
for BBC network radio (%)

Proportion of all hours produced byin-house PSB producers
for BBC network radio (%)

2018/192017/18

2018/192017/18

Radio 1

19.4

15.9

80.6

84.1

1Xtra

9.6

12.6

90.4

87.4

Radio 2

46.2

24.5

53.8

75.5

Radio 3

12.7

15.7

87.3

84.3

Radio 4

20.1

18.4

79.9

81.6

BBC 4 Extra

57.8

50.4

42.2

49.6

BBC Radio 5 live and 5 live sports extra

24.7

21.8

75.3

78.2

BBC 6 Music

22.6

25.0

77.4

75.0

BBC Asian Network

13.1

15.0

86.9

85.0

Total

21.7

18.8

78.3

81.2

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Distribution
Distribution of BBC content is key to delivering our mission and public purposes. The Charter sets out that the BBC must report on how it
has made its output and services available to the public. This section sets out our progress this year.
How we distribute our services

98.5%

99%

97.5%

Digital Terrestrial Television(DTT) coverage of UK
households

AM/FM coverage of UK
households

DAB coverage of UK
households

BBC iPlayer is available on

BBC iPlayer is available on

98%
Satellite availability to UK
households>2,500>15,000

types of TV device

types of device overall

The BBC distributes its content with thegoal of providing all audiences with fulland convenient access to all of the services
that are relevant to them. In 2018/19
we have continued to ensure that:—

We provide effectively universal
broadcast coverage of our TV andradio services—

the BBC’s video-on-demand (VOD)
service was available on moreconsumer devices (from Smart TVs, togames consoles, to tablets) than any
other VOD service in the UK—

the BBC created content tailored to
the needs and expectations of users on
popular social platforms, such as
Facebook, Twitter and YouTube

The BBC has continued to play a leadingrole throughout 2018/19 in the clearanceof the 700MHz spectrum band for use by
future 5G mobile internet services. To datemore than 40% of the transmitter network
has successfully completed clearance, andover 15 million Freeview households haveretuned their receivers, facilitated througha communications and support programme.

In addition to widespread availability,
it is important that the ways in which
our services are carried on third-party
platforms are conducive to the delivery of
our public mission. To this end, the BBC
published its Distribution Policy in June2018 following a public consultation,
as required by our Royal Charter and
its Framework Agreement. In the policy
the BBC set out seven conditions thatform the basis under which the BBC
will distribute its UK public services:(a)

Prominence – the placement of BBC
content and services relative to thoseof other providers should be in linewith audience needs and expectations

Note: The figures quoted for DTT and
DAB related to coverage for services
carried on the BBC’s multiplexes. In
addition, a small number of HD
channels and nations and regions
radio stations are made available via
commercial multiplexes.

In collaboration with ITV, Channel 4
and network operator Arqiva, the BBC
has extended its commitment to the
Freeview television platform with a new
five-year agreement. The shareholders’investment enables Freeview to accelerate
its transition to being a fully hybrid (DTT
and internet) platform offering the bestin free-to-view live and on-demand TV.
Looking to the future, the BBC
has been conducting trials of live
radio broadcasting over 5G mobile
networks in Stronsay, Orkney as partof the 5G RuralFirst initiative.

(b) Editorial Control – the BBC retains
editorial control of its content and its
placement(c)Branding and Attribution – users
should be able to easily identify which
content on a platform is provided by
the BBC(d) Quality – users should be able to enjoya high quality experience of BBC
content and services(e)Data – the BBC should have access todata about the usage of its services(f)Free Access – users should incur noincremental cost to access BBC
content and services(g) Value for Money – arrangements
should maximise cost-effectiveness of
distribution to the licence fee payer

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BBC Public Service promotions
The Agreement between the BBC and the Secretary of State sets out that the BBC must ensure that the promotion of any output of a UK
Public Service or any such service in the UK Public Services focuses on output contributing substantially to the fulfilment of the mission
and promotion of the public purposes. The BBC must publish information on such promotion, including:a)

The number of minutes of promotions in each UK Public Serviceb)

The time of day of such promotionsc)Such other information it considers would be in the public interest to publish

We consider that promotion of the UK Public Services and their output is important so that our audiences are informed about the wide
variety of content the BBC offers that informs, educates and entertains. Promotional material on the UK Public Services is produced andscheduled in line with our Editorial Guidelines.
This table sets out the total minutes of promotional material broadcast on each UK Public Service by time period in 2018/19.
Morning

Daytime

BBC One

1,598

3,353

BBC Two

2,312

1,921

N/A

N/A

1,896

1,428

3,324

1,850

2,069

1,135

N/A

5,054

BBC Four
CBBC

Evening

Overnight

Total

2,857

1,743

9,551

2,046

1,832

8,111

CBeebies

1,939

1,955

15

N/A

3,909

BBC News

3,338

4,345

3,160

4,740

15,583

BBC Parliament

N/A

N/A

N/A

N/A

N/A

BBC ALBA

N/A

N/A

N/A

N/A

N/A

Radio 1

1,820

1,993

1,118

520

5,451

1Xtra

2,184

2,288

832

364

5,668

Radio 2

2,548

2,974

2,002

2,427

9,951

Radio 3

1,340

1,506

546

0

3,392

Radio 4

2,453

2,330

1,830

0

6,613

BBC Radio 4 Extra

2,377

2,545

1,802

2,317

9,041

BBC Radio 5 live

3,276

3,822

2,747

2,613

12,458BBC Radio 5 live sports extra

N/A

N/A

N/A

N/A

N/A

2,004

2,548

1,820

312

6,684

BBC Asian Network

1,220

1,993

1,118

520

4,851

BBC Radio Scotland

2,568

2,148

1,500

0

6,216

BBC 6 MusicBBC Radio nan Gàidheal

N/A

N/A

N/A

N/A

N/A

BBC Radio Wales

2,160

2,532

1,644

744

7,080

BBC Radio Cymru

3,180

3,588

2,856

204

9,828

BBC Radio Ulster and BBC Radio Foyle

1,144

1,456

1,352

2,613

6,565

BBC Local Radio

N/A

N/A

N/A

N/A

6,754

BBC Red Button

N/A

N/A

N/A

N/A

N/A

BBC Online

N/A

N/A

N/A

N/A

N/A

Note
Time periods are defined as: morning, 6am – 11:59am; daytime, 12pm – 5:59pm; evening, 6pm – 10:59pm; overnight, 11pm – 5:59am. Minutes of promotions on radio here do notinclude the service trails for the programmes themselves; these figures are included in the following table. Promotions on BBC Parliament, BBC ALBA, BBC Radio 5 live sports extra
and BBC Radio nan Gàidheal are not measured due to very low volume and frequency. The figure for BBC Local Radio is an average figure across all local radio stations in England.
We do not have comparable data by daypart for these stations. Data is not available for promotions on BBC Red Button or BBC Online. We will report fully on BBC Scotland
next year.

164

BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C EThis table sets out the total minutes of promotional material for each UK Public Service by platform. For example, the first row sets out
the number of minutes of promotions for BBC One on BBC One itself, on other BBC TV channels, and on radio.
On Service

TV

Radio

BBC One

4,858

1,527

1,302

BBC Two

4,209

2,273

579

BBC Four

1,850

292

361

CBBC

4,785

417

36

CBeebies

3,847

94

0

BBC News

13,246464

144

BBC Parliament

N/A

N/A

N/A

BBC ALBA

N/A

N/A

N/A

Radio 1

4,851

160

0

1Xtra

5,668

11

13

Radio 2

7,961

166

41

Radio 3

2,713

0

122

Radio 4

5,092

0

199

BBC Radio 4 Extra

6,578

0

204

BBC Radio 5 live

7,445

9

102

N/A

N/A

N/A

BBC Radio 5 live sports extra
BBC 6 Music

5,013

60

672

BBC Asian Network

2,713

0

8

BBC Radio Scotland

5,496

108

48

N/A

N/A

N/A

BBC Radio Wales

591

0

0

BBC Radio Cymru

821

0

0

BBC Radio Ulster and BBC Radio Foyle

2,509

897

221

BBC Local Radio

5,065

N/A

N/A

BBC Red Button

N/A

N/A

N/A

BBC iPlayer

See below

1,579

85

BBC Sounds

See below

582

1,475

BBC Radio nan Gàidheal

Notes
Promotions on BBC Parliament, BBC ALBA, BBC Radio 5 live sports extra and BBC Radio nan Gàidheal are not measured due to very low volume and frequency. The figure for BBC
Local Radio is an average figure across all local radio stations. Data is not available for promotions on BBC Red Button. We will report fully on BBC Scotland next year.

BBC iPlayer also carries promotional material. Pre-rolls, short video advertisements that automatically play directly before a featured
programme, launched on BBC iPlayer on web in December 2015, and on BBC iPlayer on connected TVs in January 2019. The promotion
consists of one pre-roll trailer before a selected programme, which solely plays on the first play in a session. Each pre-roll has a maximum
duration of 30 seconds, but each trailer varies between 10 and 30 seconds. A user will not see the same pre-roll more than four times.
The vast majority of pre-rolls on BBC iPlayer promote BBC iPlayer content, either on demand or live. In 2018/19, there were two pre-rolls
promoting podcasts on BBC Sounds: EastEnders: The Podcast (in November 2018) and The Greatest Dancer Podcast (in January 2019),
solely placed in front of the corresponding programme. Pre-rolls are placed in front of all priority titles on BBC iPlayer. As of December
2018, CBBC pre-rolls are placed solely in front of CBBC programmes, and CBeebies pre-rolls solely in front of CBeebies programmes. A
non-children’s pre-roll is never placed in front of a children’s title and vice versa. The BBC’s priority titles are promoted with the pre-rollinventory and all placements are manually scheduled based on genre, tone and audience. The same user will get the same pre-roll on thesame episode.
Some BBC podcasts available through BBC Sounds and third-party platforms carry promotional material for other BBC podcast content.
Around three podcasts per week are agreed to be priority content, representing a range of genres to reflect the wide variety of BBC
audio output. Promotional trails, each with a duration of 15-45 seconds, for these podcasts are produced and inserted into otherpodcasts, at the start, middle and/or end of the audio file. The choice and placement of these trails is at the discretion of the podcast
producers. Some stations also trail their own content (e.g. Radio 4 promotes its content on Radio 4 podcasts).

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BBC Group Annual Report and Accounts 2018/19

165

Nations’
data packs

p.167
Wales

p.171
Scotlandp.175
Northern
Irelandp.179
England

Doctor Who
166

BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

The BBC in Wales
IncomeThese numbers are estimated as figures for each nation have been calculated by applying the proportion of licensed premises to the total
number of licences in force. The exact number of licences in force varies on a daily basis. The numbers of licensed premises are different
to the number of licences in force as, in some cases, a premise may need more than one licence. Figures exclude concessionary licences
for those living in residential care.
2019
£m

2018
£m

3,690
184

3,830
191

2019
£m

2018
£m

Network content
TV (including Sport and Childrens)*
Radio
Online and Red Button

49
3
1

50
3
1

Total network spend

53

54

Local content
TV – BBC One
TV – BBC Two
Radio WalesRadio Cymru
Online and Red Button

25
8
15
14
11

25
10
15
14
8

Total local spend

73

72

National Orchestra of Wales
S4C
Development
Distribution

5
22
1
25

5
26
–
26

Total

179

183

Estimated income
UK
Wales
For 2018/19 the fee for a standard household TV licence was £150.50.
Expenditure
Direct and indirect spend relating to programmes produced in the nation.

*

Network content is attributed on an Ofcom basis, which excludes foreign productions.

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BBC Group Annual Report and Accounts 2018/19

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TV hours by genre
Local opt-out hours^ (including repeats) on BBC One and BBC Two
2019
Hours

2018
Hours

Drama, Comedy, Entertainment, Music and Arts
Daily, Weekly News and Current Affairs
Sport and Leisure
Education, Factual and Religion

49
395
152
129

37
383
144
98

Total

725

662

2019
Hours

2018
Hours

Drama, Comedy, Entertainment, Music and Arts*
Daily, Weekly News and Current Affairs
Sport and Leisure
Education, Factual and Religion
Children’s

255
257
164
5
1

256
264
134
5
11

Total

682

670

^ Television content commissioned specifically for audiences in the nation.

S4C*

*

This represents the television programmes commissioned, produced and funded by BBC Wales and supplied to S4C (excluding programmes commissioned directly by S4C fromother producers). The total of hours for 2019 includes 126 hours of repeats (2018: 135 hours). This includes repeats where BBC Wales has incurred a charge associated with thetransmission of the programmes.

Radio hours by genre
BBC Radio Wales
2019
Hours

2018
Hours

News and Current Affairs
General

1,862
5,590

1,789
5,685

Total

7,452

7,474

2019
Hours

2018
Hours

News and Current Affairs
General

1,186
6,445

1,295
5,763

Total

7,631

7,058

2019
Number2018
Number

990

950

2019
Number2018
Number

1,231

1,208

BBC Radio Cymru

Headcount
Average headcount reflects those individuals employed to directly support the service produced in Wales

Average number of persons employed in the year
Average headcount of individuals based in Wales across all services including support functions

Average number of persons employed in the year

168

BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

Wales’ performance by service – Television

Content (£m)
We spent a total of£82 million on these
services in Wales

Reach (%)
Wales population
who use the service
each week

Time spent watchinga channel each week
(hh:mm)Length of time theaverage Wales viewer
spent each week withthe channel

BBC One is our flagship service and the UK’s most popular television channel.
It unites and inspires the nation with high-quality programmes across a range ofgenres which includes news and current affairs, drama, comedy, entertainment
and factual.

£66m

70%

07:50

2017/18: £72m

2017/18: 73%

2017/18: 08:21

BBC Two is a mixed-genre channel with programmes of depth and substance.
It includes the greatest amount and range of knowledge-building programmingon the BBC, complemented by distinctive comedy, drama and arts programming.

£13m

43%

03:08

2017/18: £12m

2017/18: 49%

2017/18: 03:18

BBC Four aims to be British television’s most intellectually and culturally
enriching channel, offering an ambitious range of UK and international arts,
music, culture and factual programmes.

£3m

11%

01:38^

2017/18: £1m

2017/18: 12%

2017/18: 01:43

The CBBC channel offers a distinctive mixed schedule for 6-12 year olds, withmainly UK programmes served in a stimulating, creative andenjoyable environment.

–

3%

*

2017/18: –2017/18: 4%

2017/18: 02:17

CBeebies provides a mix of high-quality, mostly UK-produced, programmes
designed to encourage learning through play in a consistently safe environment
for children under six.

–

5%

*

2017/18: –2017/18: 6%

2017/18: 04:06

Reach definition: 15+ minutes consecutive for all services and audiences in TV-owning households aged 4+.
Source: BARB (TV reach and time per viewer – all channels include simulcast HD channel where applicable).
N.B. BARB data available for the full 2018/19 financial year measures TV set viewing only, meaning that iPlayer viewing on other devices is not included in any of the reach and time
figures. iPlayer viewing is growing, especially for young-skewed services such as CBeebies and CBBC.
^ Lower sample size may be responsible for greater variability in the data.
* Sample size for time per user too low to report.

Wales’ performance by service – News

Content (£m)
We spent a totalof £nil on these
services in Wales

Reach (%)
Wales population
who use the service
each week

Time spent watchingor listening to aservice each week
(hh:mm)Length of time theaverage Wales viewer
or listener spent eachweek with the service

The BBC News Channel is a 24-hour impartial and independent news service
offering breaking news, analysis and insight. It provides fast and comprehensive
coverage of local, UK and international events as they unfold.

–

10%

03:43

2017/18: –2017/18: 11%

2017/18: 03:07

BBC Parliament is the UK’s only channel dedicated to politics. It shows debates
and committees from Westminster, Holyrood, Stormont, Cardiff Bay andStrasbourg as well as political programmes from across the UK.

–

1%

*

2017/18: –2017/18: 1%

2017/18: 01:38

Reach definition: 15+ minutes consecutive for all services and audiences in TV-owning households aged 4+.
Source: BARB (TV reach and time per viewer).
Three-minute reach for BBC News Channel and BBC Parliament – in line with industry standards – would be 14% and 2% respectively (16% and 2% among 16+ population).
* Sample size for time per user too low to report.

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BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

Wales’ performance by service – Radio

Content (£m)
We spent a totalof £3 million onthese services in
Wales

Reach (%)
Wales population
who use the service
each week

Time spent listening
to a service eachweek (hh:mm)
Length of time theaverage Wales listenerspent each week withthe service

BBC Radio 1 broadcasts a distinctive mix of new music and entertainment for
15-29 year olds as well as providing tailored news, documentaries and advice
campaigns for young adults.

–

21%**

08:06

2017/18: –2017/18: 24%

2017/18: 0 6:17

BBC 1Xtra plays the best in contemporary black music, with a strong emphasis
on delivering high-quality live music and supporting new artists.

–

1%+

03:45~

2017/18: –2017/18: 2%

2017/18: 02:46

BBC Radio 2 broadcasts a unique mix of music and speech programmes covering
a diverse mix of live pop and rock, comedy, documentaries and religious output,
as well as running social action campaigns to over 14 million listeners.

–

36%^

14:05

2017/18: –2017/18: 37%

2017/18: 12:36

BBC Radio 3 centres on classical music, around which it provides a broad
spectrum of jazz, world music, arts programmes, religion and drama. Thereis a strong emphasis on musical performance across the UK.

£2m

3%

05:32

2017/18: £2m

2017/18: 4%

2017/18: 05:25

BBC Radio 4 is a mixed-speech radio station, offering in-depth news and current
affairs and a wide range of other speech programmes including drama, readings,
comedy, factual and magazine programmes.

£1m

17%

10:48

2017/18: £1m

2017/18: 18%

2017/18: 12:05

Originally launched in 2002 as BBC 7, the station was relaunched in April 2011 as
BBC Radio 4 extra. The digital-only network is the principal outlet for the BBC’sarchive of speech entertainment, including comedy, drama and readings.

–

3%

08:14

2017/18: –2017/18: 3%

2017/18: 06:34

BBC Radio 5 live broadcasts continuous news and live sports coverage, bringing
major news stories and sports events to its listeners as they happen, andproviding context through wide-ranging analysis and discussion.

–

8%

06:24

2017/18: –2017/18: 8%

2017/18: 07.34

BBC Radio 5 live sports extra brings a greater choice of live action to sports fansby extending live coverage of various sporting events.

–

2%

02:51

2017/18: –2017/18: 2%

2017/18: 03:11

BBC 6 Music is a digital radio station that entertains lovers of popular music witha service that celebrates the alternative spirit of popular music from the 60s to
the present day, complemented by music news and documentaries.

–

4%

08:45

2017/18: –2017/18: 3%

2017/18: 07:53

BBC Asian Network offers speech and music appealing to British Asians, with afocus on news and current affairs. It broadcasts mainly in English, but does offersome programmes in other languages.

–

<1%

*

2017/18: –2017/18: <1%

2017/18: *Reach definition: 15+ minutes for all stations and audiences aged 15+.
Source: RAJAR (Radio reach and time per listener).
** Radio 1: amongst its target group of 15-29 year olds reach was 45% and time spent per listener was 07:01.
+	1Xtra: amongst 15-24 year olds reach was 3%.
^ Radio 2: amongst its target group of 35+ year olds reach was 43% and time spent per listener was 14:53.
* Sample size for time per user too low to report.
~ Lower sample size may be responsible for greater variability in the data.

Wales’ performance by service – Online

BBC Online comprises the BBC’s portfolio of online products on desktop,
connected TV, mobile and tablet, including news, sport and weather; ourchildren’s services CBBC and CBeebies; and Knowledge & Learning – as well as IP
delivered TV and radio services, with both live and on-demand programmes
available on BBC iPlayer.

170

BBC Group Annual Report and Accounts 2018/19

Content (£m)
We spent a total of£12 million on these
services in Wales£12m
2017/18: £9m

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G OV E R N A N C E

The BBC in Scotland
IncomeThese numbers are estimated as figures for each nation have been calculated by applying the proportion of licensed premises to the total
number of licences in force. The exact number of licences in force varies on a daily basis. The numbers of licensed premises are different
to the number of licences in force as, in some cases, a premise may need more than one licence. Figures exclude concessionary licences
for those living in residential care.
2019
£m

2018
£m

3,690
311

3,830
324

2019
£m

2018
£m

Network content
TV (including Sport and Childrens)*
Radio
Online and Red Button

80
3
2

80
3
3

Total network spend

85

86

Local content
TV – BBC One
TV – BBC Two
TV – BBC ALBA
TV – BBC Scotland
Radio Scotland
Radio nan Gàidhael
Online and Red Button

40
11
9
12
25
4
11

42
12
8
–
23
4
8

Total local spend

112

97

National Orchestra
Development
Distribution

5
6
41

5
2
42

Total

249

232

Estimated income
UK
ScotlandFor 2018/19 the fee for a standard household TV licence was £150.50.
Expenditure
Direct and indirect spend relating to programmes produced in the nation.

*

Network content is attributed on an Ofcom basis, which excludes foreign productions.

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BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

TV hours by genre
Local opt-out hours^ (including repeats) on BBC One and BBC Two
2019
Hours*

2018
Hours

Drama, Comedy, Entertainment, Music and Arts
Daily, Weekly News and Current Affairs
Sport and Leisure
Education, Factual and Religion

129
417
201
113

129
453
186
113

Total

860

881

2019
Hours

2018
Hours

605
201
250
934
621

602
189
220
969
639

2,611

2,619

^ Television content commissioned specifically for audiences in the nation.
* With the launch of the BBC Scotland channel, Scotland opt-outs on BBC Two ceased in February 2019.

BBC ALBA±

Drama, Comedy, Entertainment, Music and Arts
Daily, Weekly News and Current Affairs
Sport and Leisure
Education, Factual and Religion
Children’s
Total± In addition to the hours above there were 149 hours of continuity in 2019 (2018: 122 hours). The increase in these hours reflects 26 hours of Children’s content, produced by
BBC Scotland, within the continuity slots.

BBC Scotland channel
Launched on 24 February 2019. Full-year data not yet available as the channel was only in operation for 6 weeks in 2018/19.
Radio hours by genre
Radio Scotland
2019
Hours

2018
Hours

News and Current Affairs
General

3,227
5,455

3,098
5,429

Total

8,682

8,527

2019
Hours

2018
Hours

News and Current Affairs
General

643
4,240

656
4,241

Total

4,883

4,897

2019
Number2018
Number

988

924

2019
Number2018
Number

1,203

1,108

Radio nan Gàidhael

Headcount
Average headcount reflects those individuals employed to directly support the service produced in Scotland

Average number of persons employed in the year
Average headcount of individuals based in Scotland across all services including support functions

Average number of persons employed in the year

172

BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

Scotland’s performance by service – Television

Content (£m)
We spent a total of£131 million on these
services in Scotland

Reach (%)
Scotland population
who use the service
each week

Time spent watchinga channel each week
(hh:mm)Length of time theaverage Scotland
viewer spent eachweek with the channel

BBC One is our flagship service and the UK’s most popular television channel.
It unites and inspires the nation with high-quality programmes across a range ofgenres which includes news and current affairs, drama, comedy, entertainment
and factual.

£87m

70%

07:44

2017/18: £85m

2017/18: 72%

2017/18: 0 8:14

BBC Two is a mixed-genre channel with programmes of depth and substance.
It includes the greatest amount and range of knowledge-building programmingon the BBC, complemented by distinctive comedy, drama and arts programming.

£30m

45%

03:02

2017/18: £35m

2017/18: 48%

2017/18: 03:13

BBC Four aims to be British television’s most intellectually and culturally
enriching channel, offering an ambitious range of UK and international arts,
music, culture and factual programmes.

£4m

12%

01:46

2017/18: £4m

2017/18: 14%

2017/18: 01:56

The CBBC channel offers a distinctive mixed schedule for 6-12 year olds, withmainly UK programmes served in a stimulating, creative andenjoyable environment.

£6m

2%

*

2017/18: £8m

2017/18: 3%

2017/18: 01:58

CBeebies provides a mix of high-quality, mostly UK-produced, programmes
designed to encourage learning through play in a consistently safe environment
for children under six.

£4m

5%

04.09^

2017/18: £2m

2017/18: 6%

2017/18: 0 4:11

Reach definition: 15+ minutes consecutive for all services and audiences in TV-owning households aged 4+.
Source: BARB (TV reach and time per viewer – all channels include simulcast HD channel where applicable).
N.B. BARB data available for the full 2018/19 financial year measures TV set viewing only, meaning that iPlayer viewing on other devices is not included in any of the reach and time
figures. iPlayer viewing is growing, especially for young-skewed services such as CBeebies and CBBC.
^ Lower sample size may be responsible for greater variability in the data.
* Sample size for time per user too low to report.

Scotland’s performance by service – News

Content (£m)
We spent a total of£nil on these services
in Scotland

Reach (%)
Scotland population
who use the service
each week

Time spent watchingor listening to aservice each week
(hh:mm)Length of time theaverage Scotland
viewer or listenerspent each week withthe service

The BBC News Channel is a 24-hour impartial and independent news service
offering breaking news, analysis and insight. It provides fast and comprehensive
coverage of local, UK and international events as they unfold.

–

9%

03:33

2017/18: –2017/18: 10%

2017/18: 03:38

BBC Parliament is the UK’s only channel dedicated to politics. It shows debates
and committees from Westminster, Holyrood, Stormont, Cardiff Bay andStrasbourg as well as political programmes from across the UK.

–

1%

*

2017/18: –2017/18: 1%

2017/18: 02:05

Reach definition: 15+ minutes consecutive for all services and audiences in TV-owning households aged 4+.
Source: BARB (TV reach and time per viewer).
Three-minute reach for BBC News Channel and BBC Parliament – in line with industry standards – would be 13% and 2% respectively (14% and 2% among 16+ population).
* Sample size for time per user too low to report.

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BBC Group Annual Report and Accounts 2018/19

173

G OV E R N A N C E

Scotland’s performance by service – Radio

Content (£m)
We spent a total of£3 million on these
services in Scotland

Reach (%)
Scotland population
who use the service
each week

Time spent listening
to a service eachweek (hh:mm)
Length of time theaverage Scotland
listener spent eachweek with the service

BBC Radio 1 broadcasts a distinctive mix of new music and entertainment for
15-29 year olds as well as providing tailored news, documentaries and advice
campaigns for young adults.

–

15%**

06:10

2017/18: –2017/18: 17%

2017/18: 06:07

BBC 1Xtra plays the best in contemporary black music, with a strong emphasis
on delivering high-quality live music and supporting new artists.

–

1%+

*

2017/18: –2017/18: 1%

2017/18: 05:55

BBC Radio 2 broadcasts a unique mix of music and speech programmes covering
a diverse mix of live pop and rock, comedy, documentaries and religious output,
as well as running social action campaigns to over 14 million listeners.

–

24%^

10:53

2017/18: –2017/18: 28%

2017/18: 11:40

BBC Radio 3 centres on classical music, around which it provides a broad
spectrum of jazz, world music, arts programmes, religion and drama. Thereis a strong emphasis on musical performance across the UK.

£2m

3%

05:32

2017/18: £2m

2017/18: 3%

2017/18: 06:42

BBC Radio 4 is a mixed-speech radio station, offering in-depth news and current
affairs and a wide range of other speech programmes including drama, readings,
comedy, factual and magazine programmes.

£1m

12%

10:19

2017/18: £1m

2017/18: 15%

2017/18: 09:41

Originally launched in 2002 as BBC 7, the station was relaunched in April 2011
as BBC Radio 4 extra. The digital-only network is the principal outlet for theBBC’s archive of speech entertainment, including comedy, drama and readings.

–

3%

07:32

2017/18: –2017/18: 3%

2017/18: 04:24

BBC Radio 5 live broadcasts continuous news and live sports coverage, bringing
major news stories and sports events to its listeners as they happen, andproviding context through wide-ranging analysis and discussion.

–

6%

05:55

2017/18: –2017/18: 6%

2017/18: 06:25

BBC Radio 5 live sports extra brings a greater choice of live action to sports fansby extending live coverage of various sporting events.

–

1%

02:13~

2017/18: –2017/18: 1%

2017/18: 03:06

BBC 6 Music is a digital radio station that entertains lovers of popular musicwith a service that celebrates the alternative spirit of popular music from the
60s to the present day, complemented by music news and documentaries.

–

4%

09:01

2017/18: –2017/18: 4%

2017/18: 09:57

BBC Asian Network offers speech and music appealing to British Asians, with afocus on news and current affairs. It broadcasts mainly in English, but does offersome programmes in other languages.

–

1%

*

2017/18: –2017/18: <1%

2017/18: *Reach definition: 15+ minutes for all stations and audiences aged 15+.
Source: RAJAR (Radio reach and time per listener).
** 	Radio 1: amongst its target group of 15-29 year olds reach was 30% and time spent per listener was 05:43.
+ 	 1Xtra: amongst 15-24 year olds reach was 2%.
^ 	Radio 2: amongst its target group of 35+ year olds reach was 29% and time spent per listener was 11:40.
* 	 Sample size for time per user too low to report.
~ Lower sample size may be responsible for greater variability in the data.

Scotland’s performance by service – Online

BBC Online comprises the BBC’s portfolio of online products on desktop,
connected TV, mobile and tablet, including news, sport and weather; ourchildren’s services CBBC and CBeebies; and Knowledge & Learning – as well as IP
delivered TV and radio services, with both live and on-demand programmes
available on BBC iPlayer.

174

BBC Group Annual Report and Accounts 2018/19

Content (£m)
We spent a total of£13 million on these
services in Scotland£13m
2017/18: £11m

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The BBC in Northern Ireland
IncomeThese numbers are estimated as figures for each nation have been calculated by applying the proportion of licensed premises to the total
number of licences in force. The exact number of licences in force varies on a daily basis. The numbers of licensed premises are different
to the number of licences in force as, in some cases, a premise may need more than one licence. Figures exclude concessionary licences
for those living in residential care.
2019
£m

2018
£m

3,690
97

3,830
101

2019
£m

2018
£m

Network content
TV (including Sport and Childrens)*
Radio
Online and Red Button

24
2
1

20
2
1

Total network spend

27

23

Local content
TV – BBC One
TV – BBC Two
Radio Ulster/Foyle
Online and Red Button

24
5
18
8

25
5
18
7

Total local spend

55

55

Estimated income
UK
Northern Ireland
For 2018/19 the fee for a standard household TV licence was £150.50.
Expenditure
Direct and indirect spend relating to programmes produced in the nation.

Distribution

12

15

Total

94

93

*

Network content is attributed on an Ofcom basis, which excludes foreign productions.

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BBC Group Annual Report and Accounts 2018/19

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TV hours by genre
Local opt-out hours^ (including repeats) on BBC One and BBC Two
2019
Hours

2018
Hours

Drama, Comedy, Entertainment, Music and Arts
Daily, Weekly News and Current Affairs
Sport and Leisure
Education, Factual and Religion

39
412
70
161

46
421
88
156

Total

682

711

2019
Hours

2018
Hours

News and Current Affairs
General

3,210
4,985

3,253
5,114

Total

8,195

8,367

^ Television content commissioned specifically for audiences in the nation.

Radio hours by genre
BBC Radio Foyle/Ulster

Headcount
Average headcount reflects those individuals employed to directly support the service produced in Northern Ireland

Average number of persons employed in the year

2019
Number2018
Number

648

610

2019
Number2018
Number685

645

Average headcount of individuals based in Northern Ireland across all services including support functions

Average number of persons employed in the year

176

BBC Group Annual Report and Accounts 2018/19

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G OV E R N A N C E

Northern Ireland’s performance by service – Television

Content (£m)
We spent a total of£53 million on these
services in Northern
IrelandReach (%)
Northern Ireland
population who use
the service each week

Time spent watchinga channel each week
(hh:mm)Length of time theaverage Northern
Ireland viewer spenteach week withthe channel

BBC One is our flagship service and the UK’s most popular television channel.
It unites and inspires the nation with high-quality programmes across a range ofgenres which includes news and current affairs, drama, comedy, entertainment
and factual.

£38m

69%

06:06

2017/18: £36m

2017/18: 70%

2017/18: 06:31

BBC Two is a mixed-genre channel with programmes of depth and substance.
It includes the greatest amount and range of knowledge-building programmingon the BBC, complemented by distinctive comedy, drama and arts programming.

£10m

38%

02:33

2017/18: £8m

2017/18: 41%

2017/18: 02:42

BBC Four aims to be British television’s most intellectually and culturally
enriching channel, offering an ambitious range of UK and international arts,
music, culture and factual programmes.

£1m

11%

01:34^

2017/18: £2m

2017/18: 11%

2017/18: 01:41

The CBBC channel offers a distinctive mixed schedule for 6-12 year olds,
with mainly UK programmes served in a stimulating, creative andenjoyable environment.

£3m

5%

*

2017/18: £3m

2017/18: 5%

2017/18: 02:35

CBeebies provides a mix of high-quality, mostly UK-produced, programmes
designed to encourage learning through play in a consistently safe environment
for children under six.

£1m

7%

04:04^

2017/18: £1m

2017/18: 7%

2017/18: 04:00

Reach definition: 15+ minutes consecutive for all services and audiences in TV-owning households aged 4+.
Source: BARB (TV reach and time per viewer – all channels include simulcast HD channel where applicable).
N.B. BARB data available for the full 2018/19 financial year measures TV set viewing only, meaning that iPlayer viewing on other devices is not included in any of the reach and time
figures. iPlayer viewing is growing, especially for young-skewed services such as CBeebies and CBBC.
^ Lower sample size may be responsible for greater variability in the data.
* Sample size for time per user too low to report.

Northern Ireland’s performance by service – News

Content (£m)
We spent a total of£nil on these services
in Northern Ireland

Reach (%)
Northern Ireland
population who use
the service each week

Time spent watchingor listening to aservice each week
(hh:mm)Length of time theaverage Northern
Ireland viewer or
listener spent eachweek with the service

The BBC News Channel is a 24-hour impartial and independent news service
offering breaking news, analysis and insight. It provides fast and comprehensive
coverage of local, UK and international events as they unfold.

–

6%

02:35

2017/18: –2017/18: 7%

2017/18: 02:43

BBC Parliament is the UK’s only channel dedicated to politics. It shows debates
and committees from Westminster, Holyrood, Stormont, Cardiff Bay andStrasbourg as well as political programmes from across the UK.

–

1%

*

2017/18: –2017/18: 1%

2017/18: 02:37

Reach definition: 15+ minutes consecutive for all services and audiences in TV-owning households aged 4+.
Source: BARB (TV reach and time per viewer).
Three-minute reach for BBC News Channel and BBC Parliament – in line with industry standards – would be 10% and 2% respectively (12% and 2% among 16+ population).
* Sample size for time per user too low to report.

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BBC Group Annual Report and Accounts 2018/19

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Northern Ireland’s performance by service – Radio

Content (£m)
We spent a total of£2 million on these
services in Northern
IrelandReach (%)
Northern Ireland
population who use
the service each week

Time spent listening
to a service eachweek (hh:mm)
Length of time theaverage Northern
Ireland listener spenteach week withthe service

BBC Radio 1 broadcasts a distinctive mix of new music and entertainment for
15-29 year olds as well as providing tailored news, documentaries and advice
campaigns for young adults.

–

17%**

05:13

2017/18: –2017/18: 18%

2017/18: 04:34

BBC 1Xtra plays the best in contemporary black music, with a strong emphasis
on delivering high-quality live music and supporting new artists.

–

<1+

*

2017/18: –2017/18: 1%

2017/18: *BBC Radio 2 broadcasts a unique mix of music and speech programmes covering
a diverse mix of live pop and rock, comedy, documentaries and religious output,
as well as running social action campaigns to over 14 million listeners.

–

14%^

07:46

2017/18: –2017/18: 15%

2017/18: 0 8:14

BBC Radio 3 centres on classical music, around which it provides a broad
spectrum of jazz, world music, arts programmes, religion and drama. Thereis a strong emphasis on musical performance across the UK.

£1m

2%

04:16~

2017/18: £1m

2017/18: 2%

2017/18: 03:27~

BBC Radio 4 is a mixed-speech radio station, offering in-depth news and current
affairs and a wide range of other speech programmes including drama, readings,
comedy, factual and magazine programmes.

£1m

11%

07:18

2017/18: £1m

2017/18: 11%

2017/18: 07:51

Originally launched in 2002 as BBC 7, the station was relaunched in April 2011 as
BBC Radio 4 extra. The digital-only network is the principal outlet for the BBC’sarchive of speech entertainment, including comedy, drama and readings.

–

2%

04:16~

2017/18: –2017/18: 2%

2017/18: 03:56 ~BBC Radio 5 live broadcasts continuous news and live sports coverage, bringing
major news stories and sports events to its listeners as they happen, andproviding context through wide-ranging analysis and discussion.

–

9%

05:55

2017/18: –2017/18: 11%

2017/18: 0 4:15

BBC Radio 5 live sports extra brings a greater choice of live action to sports fansby extending live coverage of various sporting events.

–

2%

*

2017/18: –2017/18: 2%

2017/18: 01:56 ~BBC 6 Music is a digital radio station that entertains lovers of popular music witha service that celebrates the alternative spirit of popular music from the 60s to
the present day, complemented by music news and documentaries.

–

2%

07:26~

2017/18: –2017/18: 2%

2017/18: 0 5:11~

BBC Asian Network offers speech and music appealing to British Asians, with afocus on news and current affairs. It broadcasts mainly in English, but does offersome programmes in other languages.

–

<1%

*

2017/18: –2017/18: <1%

2017/18: *Reach definition: 15+ minutes for all stations and audiences aged 15+.
Source: RAJAR (Radio reach and time per listener).
** 	R adio 1: amongst its target group of 15-29 year olds reach was 36% and time spent per listener was 05:28.
+ 	 1Xtra: amongst 15-24 year olds reach was 1%. Sample size for time per user was too low to report.
^ 	Radio 2: amongst its target group of 35+ year olds reach was 18% and time spent per listener was 08:43.
* 	 Sample size for time per user too low to report.
~ 	Lower sample size may be responsible for greater variability in the data.

Northern Ireland’s performance by service – Online

BBC Online comprises the BBC’s portfolio of online products on desktop,
connected TV, mobile and tablet, including news, sport and weather; ourchildren’s services CBBC and CBeebies; and Knowledge & Learning – as well as IP
delivered TV and radio services, with both live and on-demand programmes
available on BBC iPlayer.

178

BBC Group Annual Report and Accounts 2018/19

Content (£m)
We spent a total of£9 million on these
services in Northern
Ireland£9m
2017/18: £8m

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The BBC in England
IncomeThese numbers are estimated as figures for each nation have been calculated by applying the proportion of licensed premises to the total
number of licences in force. The exact number of licences in force varies on a daily basis. The numbers of licensed premises are different
to the number of licences in force as, in some cases, a premise may need more than one licence. Figures exclude concessionary licences
for those living in residential care.
2019
£m

2018
£m

3,690
3,085

3,830
3,201

2019
£m

2018
£m

Network content
TV (including Sport and Childrens)*
Radio
Online and Red Button

1,246
290
160

1,138
276
136

Total network spend

1,696

1,550

Local content
TV – BBC One
Radio English Regions
Online and Red Button

105
124
16

100
118
15

Total local spend

245

233

Orchestras and performing groups
Development
Distribution

19
60
116

17
54
125

2,136

1,979

Estimated income
UK
EnglandFor 2018/19 the fee for a standard household TV licence was £150.50.
Expenditure
Direct and indirect spend relating to programmes produced in the nation.

Total
*

Network content is attributed on an Ofcom basis, which excludes foreign productions.

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BBC Group Annual Report and Accounts 2018/19

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TV hours by genre
Local opt-out hours^ (including repeats) on BBC One and BBC Two
2019
Hours

2018
Hours

Daily, Weekly News and Current Affairs
Sport and Leisure
Education, Factual and Religion

4,115
23
26

4,108
24
22

Total

4,164

4,154

2019
Hours

2018
Hours

General230,223

216,023

Total

230,223

216,023

2019
Number2018
Number

2,656

2,590

2019
Number2018
Number14,32013,740^ Television content commissioned specifically for audiences in the nation.

Radio hours by genre
BBC English Regions

Headcount
Average headcount reflects those individuals employed to directly support the service produced in England

Average number of persons employed in the year
Average headcount of individuals based in England across all services including support functions

Average number of persons employed in the year

180

BBC Group Annual Report and Accounts 2018/19

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England’s performance by service – Television

Content (£m)
We spent a total of£1,303 million onthese services inEnglandReach (%)
England population
who use the service
each week

Time spent watchinga channel each week
(hh:mm)Length of time theaverage Englandviewer spent eachweek with the channel

BBC One is our flagship service and the UK’s most popular television channel.
It unites and inspires the nation with high-quality programmes across a range ofgenres which includes news and current affairs, drama, comedy, entertainment
and factual.

£868m

66%

06:57

2017/18: £774m

2017/18: 68%

2017/18: 07:14

BBC Two is a mixed-genre channel with programmes of depth and substance.
It includes the greatest amount and range of knowledge-building programmingon the BBC, complemented by distinctive comedy, drama and arts programming.

£325m

41%

03:00

2017/18: £309m

2017/18: 44%

2017/18: 03:07

BBC Four aims to be British television’s most intellectually and culturally
enriching channel, offering an ambitious range of UK and international arts,
music, culture and factual programmes.

£35m

12%

01:43

2017/18: £30m

2017/18: 13%

2017/18: 01:44

The CBBC channel offers a distinctive mixed schedule for 6-12 year olds, withmainly UK programmes served in a stimulating, creative andenjoyable environment.

£50m

4%

02:24

2017/18: £55m

2017/18: 4%

2017/18: 02:36

CBeebies provides a mix of high-quality, mostly UK-produced, programmes
designed to encourage learning through play in a consistently safe environment
for children under six.

£25m

6%

04:04

2017/18: £25m

2017/18: 7%

2017/18: 0 4:14

Reach definition: 15+ minutes consecutive for all channels and services and audiences in TV-owning households aged 4+ (TV).
Source: BARB (TV reach and time per viewer – all channels include their simulcast HD channel where applicable).
N.B. BARB data available for the full 2018/19 financial year measures TV set viewing only, meaning that iPlayer viewing on other devices is not included in any of the reach and time
figures. iPlayer viewing is growing, especially for young-skewed services such as CBeebies and CBBC.

England’s performance by service – News

Content (£m)
We spent a total of£48 million on these
services in England

Reach (%)
England population
who use the service
each week

Time spent watchingor listening to aservice each week
(hh:mm)Length of time theaverage Englandviewer or listenerspent each week withthe service

The BBC News Channel is a 24-hour impartial and independent news service
offering breaking news, analysis and insight. It provides fast and comprehensive
coverage of local, UK and international events as they unfold.

£46m

8%

02:50

2017/18: £43m

2017/18: 9%

2017/18: 02:39

BBC Parliament is the UK’s only channel dedicated to politics. It shows debates
and committees from Westminster, Holyrood, Stormont, Cardiff Bay andStrasbourg as well as political programmes from across the UK.

£2m

1%

02:01^

2017/18: £2m

2017/18: <1%

2017/18: 01:43

Reach definition: 15+ minutes consecutive for all services and audiences in TV-owning households aged 4+.
Source: BARB (TV reach and time per viewer).
Three-minute reach for BBC News Channel and BBC Parliament – in line with industry standards – would be 12% and 1% respectively (13% and 2% among 16+ population).
^ Lower sample size may be responsible for greater variability in the data.

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BBC Group Annual Report and Accounts 2018/19

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England’s performance by service – Radio

Content (£m)
We spent a total of£290 million on these
services in England

Reach (%)
England population
who use the service
each week

Time spent listening
to a service eachweek (hh:mm)
Length of time theaverage Englandlistener spent eachweek with the service

BBC Radio 1 broadcasts a distinctive mix of new music and entertainment for
15-29 year olds as well as providing tailored news, documentaries and advice
campaigns for young adults.

£41m

17%**

06:13

2017/18: £37m

2017/18: 17%

2017/18: 0 6:19

BBC 1Xtra plays the best in contemporary black music, with a strong emphasis
on delivering high-quality live music and supporting new artists.

£7m

2%+

04:16

2017/18: £6m

2017/18: 2%

2017/18: 04:44

BBC Radio 2 broadcasts a unique mix of music and speech programmes covering
a diverse mix of live pop and rock, comedy, documentaries and religious output,
as well as running social action campaigns to over 14 million listeners.

£49m

27%^

11:56

2017/18: £49m

2017/18: 28%

2017/18: 11:55

BBC Radio 3 centres on classical music, around which it provides a broad
spectrum of jazz, world music, arts programmes, religion and drama. Thereis a strong emphasis on musical performance across the UK.

£33m

4%

06:12

2017/18: £33m

2017/18: 4%

2017/18: 05:57

BBC Radio 4 is a mixed-speech radio station, offering in-depth news and current
affairs and a wide range of other speech programmes including drama, readings,
comedy, factual and magazine programmes.

£89m

20%

11:05

2017/18: £83m

2017/18: 22%

2017/18: 11:0 4

Originally launched in 2002 as BBC 7, the station was relaunched in April 2011 as
BBC Radio 4 extra. The digital-only network is the principal outlet for the BBC’sarchive of speech entertainment, including comedy, drama and readings.

£3m

4%

06:10

2017/18: £3m

2017/18: 4%

2017/18: 05:38

BBC Radio 5 live broadcasts continuous news and live sports coverage, bringing
major news stories and sports events to its listeners as they happen, andproviding context through wide-ranging analysis and discussion.

£45m

10%

06:43

2017/18: £44m

2017/18: 10%

2017/18: 06:36

BBC Radio 5 live sports extra brings a greater choice of live action to sports fansby extending live coverage of various sporting events.

£3m

2%

03:15

2017/18: £3m

2017/18: 2%

2017/18: 03:18

BBC 6 Music is a digital radio station that entertains lovers of popular music witha service that celebrates the alternative spirit of popular music from the 60s to
the present day, complemented by music news and documentaries.

£12m

5%

09:24

2017/18: £11m

2017/18: 5%

2017/18: 0 9:15

BBC Asian Network offers speech and music appealing to British Asians, with afocus on news and current affairs. It broadcasts mainly in English, but does offersome programmes in other languages.

£8m

1%

05:16

2017/18: £7m

2017/18: 1%

2017/18: 05:27

Reach definition: 15+ minutes for all stations and audiences aged 15+.
Source: RAJAR (Radio reach and time per listener).
**	Radio 1: among its target group of 15-29 year olds reach was 31% and time spent per listener was 06:00.
+ 	 1Xtra: among 15-24 year olds reach was 6% and time spent was 03:20.
^ 	 Radio 2: among its target group of 35+ year olds reach was 34% and time spent per listener was 12:47.

England’s performance by service – Online

BBC Online comprises the BBC’s portfolio of online products on desktop,
connected TV, mobile and tablet, including news, sport and weather; ourchildren’s services CBBC and CBeebies; and Knowledge & Learning – as well as IP
delivered TV and radio services, with both live and on-demand programmes
available on BBC iPlayer.

182

BBC Group Annual Report and Accounts 2018/19

Content (£m)
We spent a total of£176 million on these
services in England£176m
2017/18: £151m

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G OV E R N A N C E

Independent Assurance Report to theBoard of the British Broadcasting
Corporation, acknowledging that
Parliament also places reliance on theGroup Accounts and Report
I have conducted independent assurance
procedures on the disclosures includedin the British Broadcasting Corporation(BBC) Annual Report arising from therequirement under the Royal Charter forthe continuance of the BBC (the Royal
Charter) to publish the provision for theUnited Kingdom’s nations and regions,
including how the BBC delivered thecreative remit in the nations and regions.
These disclosures comprise performanceagainst the BBC’s public purpose toreflect, represent and serve the diverse
communities of the United Kingdom’s
nations and regions and support thecreative economy, as set out on pages
166 to 182 of the BBC’s Annual Report.
My work is conducted in accordance with
International Standards on Assurance
Engagements (ISAE) 3000 Assurance
Engagements Other Than Audits or
Reviews of Historic Financial Information.
Respective responsibilities of the
BBC Board and the Comptroller and
Auditor General
For the reporting year covered by thisreport, the BBC Board was responsible
for publishing information required by theRoyal Charter as follows: the provision
for the United Kingdom’s nations andregions, including how the BBC delivered
the creative remit in the nations andregions for the year-ended 31 March 2019(the subject matter) (“Nations Report”).
I am responsible for providing an opinion
on whether, in all material respects, thesubject matter is complete and accurate
and has been properly prepared inaccordance with the basis set out therein.
In conducting this work, my staff andI have complied with the Financial
Reporting Council’s Revised EthicalStandard 2016. I am independent of
the BBC in accordance with the ethicalrequirements that are relevant to myassurance engagement. My staff and I havefulfilled our other ethical responsibilities
in accordance with these requirements.

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My approach
I have performed a reasonable assurance
engagement as defined in ISAE 3000.
A reasonable assurance engagement
is to perform such procedures as toobtain information and explanations
which I consider necessary to express
an opinion on whether, in all material
respects, the Nations Report (the subject
matter) is complete and accurate and has
been properly prepared in accordancewith the basis set out therein.
My work consisted of understanding theprocess adopted by the BBC to derive thedisclosures, in particular the completenessand accuracy of information used. This
enabled me to design procedures in
response to risks identified. I performed
procedures in relation to the figures
disclosed which included: agreement tothird party evidence such as data issued
by the Broadcasters Audience Research
Board (BARB); agreement to schedulingreports; cross-reference to disclosures
made in the BBC Group financial
statements; recalculation and confirmationof mathematical accuracy; and agreementof headcount data to payroll reports.
Inherent limitations
My assurance procedures have been
designed to provide reasonable assurance.
The objective of a reasonable assurance
engagement is to reduce engagement
risk to an acceptably low level in thecircumstances of the engagement as thebasis for a positive form of expression of myconclusion. It does not, however, eliminate
this risk entirely. In particular, in preparing
the disclosures, the BBC Board is required
to make a number of judgements which
inherently introduces an element of risk.
OpinionBased on the results of my procedures,in my opinion, in all material respects the
Nations Report set out on pages 166 to
182 is complete and accurate and has
been properly prepared in accordancewith the basis set out therein.

Gareth Davies
Comptroller & Auditor General
National Audit Office157-197 Buckingham Palace Road
London SW1W 9SP
21 June 2019

BBC Group Annual Report and Accounts 2018/19

183

Financial
statements

p.185
The Certificate and Report of theComptroller and Auditor General

BAFTA award-winning factual series Louis Theroux’s Altered States
184

BBC Group Annual Report and Accounts 2018/19

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F I N A N C I A L S TAT E M E N T S

The Certificate and Report of theComptroller and Auditor General to
the Board of the British Broadcasting
Corporation, acknowledging that
Parliament also places reliance on
the Group Accounts and Report
Opinion on financial statements
I certify I have audited the financial
statements of the British Broadcasting
Corporation (BBC) for the year ended
31 March 2019, which comprise:—the consolidated income statement;—

the consolidated statement ofcomprehensive income/loss;—

the consolidated balance sheet;—the consolidated statement of changes
in equity;—

the consolidated cash flow statement;
and—the related notes, including thesignificant accounting policies.

The financial reporting framework thathas been applied in their preparation is
the Royal Charter for the continuanceof the British Broadcasting Corporation
and International Financial ReportingStandards as adopted by the European
Union. I have also audited the informationin the Remuneration Report that is
described as having been audited.
In my opinion the consolidated
financial statements:—

give a true and fair view of the state of
the group’s affairs as at 31 March 2019and of its deficit for the year thenended; and—have been properly prepared inaccordance with International Financial
Reporting Standards as adopted by theEuropean Union.

Opinion on regularity
In my opinion, except for the £12 million
costs associated with the provision referred
to in the Basis for my qualified regularity
opinion below, in all material respects, theincome and expenditure recorded in the
consolidated financial statements conformto the authorities which govern them.

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Basis for my qualified regularity opinion
I have qualified my audit opinion on
regularity on these financial statements inrelation to the recognition of a provisionof £12 million. Note F10 provides details
on this provision, setting out that it relates
to the BBC’s commitment to “settle
the historic issues, at an acceptable
cost to the licence fee, which resolves
most of the retrospective claims that
HMRC may have against the presentersin respect of any misclassification of
their employment status… The BBC
has approached HMRC with a view toreaching a settlement of…the PAYE and
NIC due under IR35 where individuals
have been paid via intermediaries”.
The BBC first disclosed its intentions inrelation to a settlement with HMRC in its
2017-18 Annual Report and Accounts.
My predecessor’s report upon thoseaccounts stated “I shall, of course, expect
the BBC to have proper regard to its
obligation, set out in the Royal Charter forthe continuance of the BBC, to exercise
rigorous stewardship of public moneyin accordance with the principles ofregularity, propriety, value for money andfeasibility, and shall take this into accountas necessary in my reports next year.”
The BBC’s Board acknowledges that it
considers this is an irregular use of thelicence fee but sets out the BBC’s reasonsfor embarking on this course of action
on page 93. The BBC Board considers
the settlement “…offers the best value
for money of the available settlement
options and resolves the historic issues
in a way which is fair to all sides.”Basis of opinions
I conducted my audit in accordance with
International Standards on Auditing(ISAs) (UK) and Practice Note 10 ‘Audit
of Financial Statements of Public Sector
Entities in the United Kingdom’. My
responsibilities under those standards
are further described in the Respective
Responsibilities of the BBC Board andthe Comptroller and Auditor General
section of my certificate. Those standards
require me and my staff to comply
with the Financial Reporting Council’s
Revised Ethical Standard 2016. I am
independent of the BBC in accordancewith the ethical requirements that are
relevant to my audit and the financial
statements in the UK. My staff and I havefulfilled our other ethical responsibilities
in accordance with these requirements.
I believe that the audit evidence I haveobtained is sufficient and appropriate
to provide a basis for my opinion.
The regularity framework that has been
applied comprises:—

the Royal Charter for the continuanceof the British Broadcasting
Corporation;—

the Agreement between Her Majesty’s
Secretary of State for Digital, Culture,
Media and Sport and the British
Broadcasting Corporation; and—other agreements the BBC has enteredinto with Government Ministers.

Whilst acknowledging the BBC Board’s
rationale, I consider that the BBC, in
committing to make such payments
to HMRC, is settling, ex gratia, the tax
liabilities of third parties. I therefore
consider that this expenditure does
not accord with the BBC’s Charter
obligations with respect to the principleof regularity and have qualified myopinion on regularity accordingly.

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Key audit matters
Key audit matters are those mattersthat, in my professional judgement, wereof most significance in my audit of thefinancial statements of the current period
and include the most significant assessedrisks of material misstatement (whether
or not due to fraud) that I identified.
I consider the following areas of particular
audit focus to be those areas that had thegreatest effect on my overall audit strategy,
the allocation of resources in my audit anddirecting the efforts of the audit team in thecurrent year. These matters were addressedin the context of my audit of the financial
statements as a whole, and in forming
my opinion thereon, and I do not provide
a separate opinion on these matters.
This is not a complete list of all risks
identified by my audit but only those areasthat had the greatest effect on my overall
audit strategy, allocation of resources anddirection of effort. I have not, for example,
included detailed information relating to
the general work I have performed aroundthe presumed risk of management overrideof controls, which are areas where my work
has not identified any matters to report.
The areas of focus were discussed with
the Audit and Risk Committee; theirreport on matters that they considered
to be significant to the financial
statements is set out on pages 201 to
257. The description of the risks below
should be read in conjunction with the
Audit and Risk Committee’s report.

186

I identified three key audit matters in
2017/18 which are no longer applicablein 2018/19. These are:—Creation of BBC Studios Ltd. BBC
Studios Limited was established as aseparate legal entity in 2017/18, having
previously been a division of the BBC
Public Service Broadcaster. No audit
procedures were necessary in 2018/19
as BBC Studios Ltd continued as aseparate legal entity;—

Service spend disclosures. The BBC
no longer includes these disclosures in
its financial statements following the
introduction of new reporting
requirements by the BBC’s regulator,
Ofcom; and—Implementing new regularity
requirements. In 2017/18, the Royal
Charter explicitly included, for the firsttime, the concepts of regularity andpropriety. The BBC was required toassess existing policies and processes
and determine whether amendment or
update was necessary to respond to
the new requirements. Since theseconcepts are no longer new, the audit
procedures undertaken to assess theimplementation of these new policies
and processes in 2017/18 has notbeen necessary this year. However,specific regularity requirements areincorporated into key audit matters
as appropriate.

BBC Group Annual Report and Accounts 2018/19

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F I N A N C I A L S TAT E M E N T S

Key audit matter description

The findings I communicatedto the Audit and Risk Committee

The scope of my audit work in response

Key audit matters relating to my opinion on the financial statements
Accounting for employment-related matters (including regularity)
Refer to the Audit and Risk Committee
I have made enquiries of management
report page 122 and note F10 ofand the BBC’s legal team to understandthe financial statements.
these issues and I have assessed thereasonableness of management’s
During 2017/18, matters relating to
key judgements and assumptions
pay at the BBC rose to prominence andarising from these matters.
I identified this as a key audit matter.
These matters have continued to develop
My audit procedures have included
during 2018/19. These include:
reviewing Board papers and minutes
and assessing management’s processes— continuing discussions with HMRC
and controls for identifying andregarding historic tax liabilities
evaluating the financial reporting
arising from the incorrect tax status
implications of these matters.
classification of individuals engaged
by the BBC on a freelance basis. The
I have tested key provisions andBBC has recognised a provision for thecontingent liabilities relating toamount it is prepared to contribute toemployment issues, as well as a sample
historic tax liabilities that may ariseof other provisions based on risk andand to protect individuals’ tax status;
value. My procedures included agreeing
liabilities and disclosures to underlying— continued implementation ofevidence, and, where appropriate,changes to IR35 rules that came
recalculating the amounts recognised orinto effect in 2017/18; anddisclosed in the financial statements.
— equal pay claims.
I reviewed the disclosure of provisions
and contingent liabilities in the financial
I have assessed a significant risk to
statements to assess their accuracy,
my audit because establishing thecompleteness and consistency withexistence, completeness and valuation
financial reporting requirements andof provisions or contingent liabilities
my understanding of the issues.
involves management’s judgement andestimation; moreover, there are high levels
I have considered whether the nature ofof Parliamentary interest in these issues.
the transactions recognised in relation toemployment-related matters accords with
Under the current Royal Charter the BBC is
the requirements of the BBC’s framework
required to make disclosures in its Annual
Report in relation to people paid more than of authorities and Parliamentary intentions.
£150,000 from the licence fee. The resultsof my separate reporting engagement onthese disclosures are set out on page 120.
Complex property transactions
Total net book value of property, plantand equipment – £1,028 million (2017/18:£1,038 million). Refer to notes D1 (financial
disclosures) and note H (accounting
policies) and the risks set out in the Audit
and Risk Committee report on page 122.
The BBC has a large and diverse portfolio
of properties. The arrangements forthese properties include owned assets,
investment properties and assets held
under finance or operating leases.
The BBC has a borrowing limit set by the
Secretary of State for Digital, Culture,
Media and Sport; this affects the ways
the BBC can finance major projects. Saleand leaseback arrangements, including
those facilitated through special purpose
vehicles as a means to raise finance on thebond markets, are one method the BBC
has used to fund certain estates projects.
In managing its property portfolio
and related financing arrangements,
certain past transactions have given
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On the basis of the procedures performed,
I consider that the accounting treatment
adopted for these transactions isappropriate.
In respect of my considerations in respectof regularity, I have qualified my audit
opinion on regularity on these financial
statements in relation to the recognitionof a provision of £12 million. I explain myreasons for doing this in the basis for myqualified regularity opinion on page 185.

I have carried out work to understandthe BBC’s overall property strategy
and any changes that could have aconsequent financial statement impact.

On the basis of the procedures
performed, I consider that the accounting
treatment adopted for these complex
property transactions is appropriate.

My procedures included making
enquiries of management; review ofBoard minutes and business plans
and visiting certain key properties.

I am content that, in respect of IFRS
16, management has made sufficient
disclosures around the impact this new
standard will have for the BBC Group.

A: Properties held under leasingarrangements— For the BBC’s material leases,
I have assessed whether theseleases should be accounted for as
finance or operating leases. My audit
procedures included considering thereasonableness of management’s key
assumptions and judgements andchecking these for consistency with theunderlying contractual documentation.
—

I have considered the reasonablenessof the key assumptions used bymanagement in the finance leaseaccounting models. I checked the
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Key audit matter description

The scope of my audit work in response

The findings I communicatedto the Audit and Risk Committee

Key audit matters relating to my opinion on the financial statements
Complex property transactions continued
rise to accounting treatments which
key model inputs to the terms ofare not straightforward and require
the lease agreements and otherthe application of judgement. I haveexpected inputs. I assessed thedeemed complex transactions arisingmechanical accuracy of the models
from the BBC’s property strategy to be
and re-performed the calculation ofa significant risk area for my audit. The
the lease amounts included in thefollowing complex property transactions
financial statements. I assessed the
involve significant judgement and havereasonableness of management’s
been key areas of focus for my work:
calculations by comparing theoutputs of my work to the amounts
A: Properties held under leasing
calculated by management.
arrangements— The classification of significant legacy— I have reviewed the key assumptions
leasing arrangements in respect ofand calculations used by management
the BBC’s New Broadcasting Housein determining the disclosures for
and White City sites in London andthe expected impact of the adoption
its Pacific Quay site in Glasgow,
of IFRS 16, Leases, in 2019/20.
as finance or operating leases.
B: New Broadcasting House re-financing— The valuation of the BBC’s major
I have assessed the reasonableness offinance lease assets and liabilities
the accounting treatment in relation to
involves the use of complex models
the classification and valuation of theto calculate the valuations.
cash flow swaps used in the past refinancing of the New Broadcasting House— In 2018/19, the BBC has beensale and leaseback. My audit procedures
required to determine changes inincluded assessing the reasonableness oflease assets and liabilities arising
management’s key valuation assumptions
from IFRS 16, Leases, which becomesand judgements. Using corporate financeapplicable from 1 April 2019. The
specialists, I checked management’s
BBC is required to include disclosure
key assumptions and judgements forin the 2018/19 financial statements
consistency with underlying contracts,
regarding the expected impact
published rates and market practice; and Iof adopting IFRS 16, Leases.
assessed the sensitivity of management’s
valuations to changes in key assumptions.
B: New Broadcasting House re-financing— The valuation of the series of
C: Property disposals
significant derivative cash flow swaps
I have considered management’s key
which form the basis of the 2016/17
judgements in relation to the accounting
refinancing of the New Broadcastingtreatments adopted for certain past andHouse sale and leaseback
planned disposals of property. My audit
arrangement. The valuation of theseprocedures included checking the basis
swaps involves judgement and is highlyof deferred sale proceeds and overagesensitive to the assumptions made.
agreements to underlying contracts; andreviewing board minutes and business
C: Property disposals
plans to confirm the completeness of— The existence and valuation ofproperty disclosed as held for sale.
deferred sales proceeds and thetreatment of an overage clausein relation to a past disposal ofland, where judgement is required
regarding the treatment of these
items in the financial statements.
—

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The classification, completenessand valuation of property availablefor-sale which could have a material
impact on the financial statements.

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F I N A N C I A L S TAT E M E N T S

Key audit matter description

The findings I communicatedto the Audit and Risk Committee

The scope of my audit work in response

Key audit matters relating to my opinion on the financial statements
Risk of fraud in revenue recognition
In relation to the licence fee revenue grant
Total revenue recognised – £4,889 million
recognised in the BBC’s consolidated(2017/18: £5,062 million). Refer to note A1
financial statements, I have assessed(financial disclosures) and note H (accounting
the reasonableness of the BBC’s licencepolicies) and the risks set out in the Audit
fee revenue recognition policy, including
and Risk Committee report on page 122.
against IFRS 15, Revenue from Contracts
International Standards on Auditing
with Customers. I have substantively(UK) require me to consider whether
tested the amounts and the timing ofor not there is a risk of fraud in respect
licence fee revenue funding paid to theof revenue recognition. Given the
BBC by the Secretary of State for Digital,
scale and nature of the BBC’s income
Culture, Media and Sport; and the amounts
streams, I have not rebutted this risk.
and timing of payments made by the
My scoping work has identified theDepartment for Work and Pensions tofollowing transactions streams as
the BBC in respect of television licences
areas of specific focus for my audit:
issued free-of-charge to over-75s.
Licence fee revenue (£3,690 million
Given that the licence fee revenue and(2017/18: £3,830 million)
balances recorded in the Trust Statement
The BBC’s primary source of funding isderived from the Television Licence Fee(the ‘licence fee’). The Telecommunications
Act 2003 requires that licence fees mustbe paid to the BBC which, in turn, must
remit the amounts collected to theConsolidated Fund. The BBC Licence Fee
Unit uses an outsourced service provider,
Capita, to collect licence fees on its behalf.
Licence fees collected are broughtto account within the BBC Television
Licence Fee Trust Statement (‘the Trust
Statement’). This is a separate account,which I also audit. The licence fee revenue
recorded in the BBC consolidated financial
statements is a grant-in-aid funding
settlement, paid directly to the BBCfrom the Secretary of State for Digital,
Culture, Media and Sport from sums
drawn down for the Consolidated Fund inrespect of licence fees issued in the year.
The licence fee income and balances
recorded in the Trust Statement provide anauthoritative expectation of the amount oflicence fee funding the BBC receives in theyear from the Secretary of State, and which
it recognises in its financial statements.

On the basis of the procedures I have
performed I consider licence fee revenue
funding and related balances to beappropriately recognised and reported.
I have considered the recognition pointof licence fee revenue within the BBC’s
consolidated financial statements
and consider this to be appropriate.
I have considered the implications
for viability and going concern inthe context of the reduction of DWP
funding and new arrangements forover 75s and have not identified
any concerns. I have recommended
management enhance disclosures inrelation to this, which they have done.

provide an authoritative expectation as
to the related licence fee grant funding
and balances recorded in the consolidated
financial statements, I have carried out
audit procedures on the BBC Licence Fee
Unit collection systems and processes
and on related transactions and balances
reported in the Trust Statement. These
included obtaining assurance on thecompleteness and occurrence of licence fee
income recorded in the Trust Statement byusing IT audit procedures on key licence feecollection systems and testing a sample ofin-year transactions and year-end balances.
I have also obtained assurance over theproper operation of cut-off by examining
evidence showing cash receipts andlicences issued around the year end.
I have considered whether there are
any implications for going concern andviability arising from the reduction
in DWP funding year-on-year.

Licence fee funding includes a settlementof £468 million in 2018/19 from the
Department for Work and Pensions(DWP), in relation to the provision offree television licences to over-75s. DWP
funding will continue in relation to freetelevision licences for over-75s until June
2020 and will gradually withdraw eachyear until that date. 2018/19 DWP fundingwas £187 million less than in 2017/18. In
June 2019, the BBC Board announced
arrangements for over 75s that will
come into effect in June 2020. Further
information is included in Note G8.

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Key audit matter description

The scope of my audit work in response

The findings I communicatedto the Audit and Risk Committee

Key audit matters relating to my opinion on the financial statements
Risk of fraud in revenue recognition continued
The grant-nature of the licence feerevenue recorded by the BBC means thatrevenue recognition for this income stream
is, generally, not complex. Licence feerevenue recognition in the related Trust
Statement is also, generally, not complex.
This is because income is recognised on
issuance of a licence and the amountfor each licence type is a fixed price.
However this judgement has required
further consideration by management in
2018/19 due to the adoption of IFRS 15,
Revenue from Contracts with Customers.
I have assessed a risk in this area becauseof the importance of licence fee funding
to the BBC and the Parliamentaryand public interest in it, as well as thesignificant sums involved. Consequently,
I consider that there may be an incentive
to manage and report this revenue inways that meet management’s or licencefee payers’ expectations. This might
involve the BBC or other parties involvedin the licence fee revenue collection andreporting process. I consider that there
is a heightened risk around the year endof revenue recognition being managed
to achieve particular results and this has
been a key focus of my testing in this area.
Commercial revenue and profit recognition(£1,199 million (2017/18: £1,232 million))
There are a number of revenue streams
from different sources within the BBC’scommercial subsidiaries, including
subscriber revenues, distribution and saleof BBC branded products. Audit risk arises
from the level of judgement in respect of
the completeness and cut-off of revenue.
In 2018/19 this risk has developed to also
consider the timing of revenue recognitionin light of the adoption of IFRS 15 Revenue
from Contracts with Customers. Thisrisk is particularly relevant within BBC
Studios Group as the largest commercial
subsidiary and where most revenue isearned from outside of the BBC Group.
One of the largest revenue streams
within BBC Studios Group relates tothe distribution of content. Commercial
distribution rights acquired by the BBC
relating to this content are treated as
intangible assets within BBC Studios
Group’s financial statements. In March
2019 BBC Studios entered into a series ofagreements with Discovery Inc to provide
content, including landmark natural history
programmes, future BBC-commissioned
landmark natural history programmes
and rights to programming across factual
genres. This agreement supports Discovery
Inc’s launch of a global SVOD service.
190

I have carried out work to understandthe nature of the BBC’s commercial
profits including reviewing contractual
documentation and management
reporting, making enquires ofmanagement responsible for BBC
commercial activities (both within the UK
and at significant territories overseas,
both by value and by risk). I have also
researched wider market practice inrelation to revenue recognition in the
media sector. I used this understanding
to assess the reasonableness of revenue
recognition policies adopted by the BBC’scommercial subsidiaries, focusing myattention on the highest risk and mostsignificant revenue streams: channels,
distribution, and format sales.

I have concluded that commercial revenue
and profit is appropriately recognised andreported. I have considered the principles
adopted by the BBC, in particular the
new requirements of IFRS 15 Revenue
from Contracts with Customers whichcame into effect during the reporting
period, in relation to point of revenue
recognition and the policies adopted
to amortise distribution rights,and
found these to be appropriate.
I identified an audit difference in relation to
the accrual of royalty payments to a third
party. On bringing this to management’s
attention, management adjusted thefinancial statements accordingly.

My testing included: undertaking detailed
analysis of key revenue streams andidentifying transactions with the greatest
risk for further analysis, reviewing
significant revenue contracts to understandthe key features and confirming thatthey have been treated appropriately inthe financial statements (with particularfocus on the requirements of IFRS 15,
Revenue from Contracts with Customers);
and, considering transactions arisingaround the year end, for evidence ofdelivery and licence period start dates.
I have particularly focused on the year
end, as the timing of BBC Studios GroupBBC Group Annual Report and Accounts 2018/19

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F I N A N C I A L S TAT E M E N T S

Key audit matter description

The findings I communicatedto the Audit and Risk Committee

The scope of my audit work in response

Key audit matters relating to my opinion on the financial statements
Risk of fraud in revenue recognition continued
BBC Studio Group’s revenue is affected
revenue is skewed towards March toby judgements in relation to the point at
coincide with the BBC Showcase event,which revenue relating to the distribution
and the agreement entered into betweenof content arises and the timing and
BBC Studios and Discovery Inc.
nature of the agreements with Discovery
I have also assessed the judgements
Inc, in particular, represent risks aroundmade in respect of amortising commercial
cut-off and completeness of revenue.
distribution rights. I reviewed the basis on
In addition, management must exercise
which the amortisation principles were
judgement in the following areas which
determined, comparing these to the known
could have a material impact on profit:and forecast timing of the realisation of
the value of these rights. I considered— the amortisation of commercial
whether any amendments were required to
distribution rights. Amortisation
the policy in light of developments in BBC
is based on the expected revenue
Studio Group’s business, and wider market
profile of the programme portfolio.
practice, during the reporting period.
As a key area of judgement, risks arise
as changes in assumptions could
have a material impact on profit;—

revenue associated with productions.
Although the majority of production
revenue is generated from within
the BBC Group, a material amount isderived from outside the group. There
are risks around completeness, cut-off
and recoverability of this revenue;—

impairment of investments. I
provide further commentary on
this in the key audit matter relating
to accounting for investments,
associates and joint ventures.

Capitalisation and major projects
Total value of assets under construction –£117 million (2017/18: £103 million). Referto note D1 (financial disclosures) and noteH (accounting policies). Refer to the Audit
and Risk Committee report on page 122.
A number of significant projects support
the BBC’s strategy, many of which
are capitalised in the BBC’s financial
statements. These projects relate todigitalisation, enhancing technology, andchanges in the way the BBC engages withaudiences, as well as capital construction
projects. Judgement is required around theappropriate capitalisation of expenditure
and also the valuation of assets generated
where there are risks that the expected
benefits may not be delivered as planned.

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I have assessed the governance andcontrol arrangements relating to themost significant projects currently
in progress. I have sample tested
transactions and balances relating tothese projects to confirm these havebeen appropriately recognised as assets
under construction or asset additions.

I consider major projects to beappropriately accounted for in the BBC’s
consolidated financial statements.

I have reviewed the procedures
implemented by the BBC to determine
whether impairment is necessary.
Alongside this, I have reviewed Board
minutes, made enquires with project
managers and undertaken my own
research to determine whether there
are any indicators of impairment.

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Key audit matter description

The scope of my audit work in response

Key audit matters relating to my opinion on the financial statements
Valuation of the pension scheme liability
Total value of pension scheme liability
I have understood the BBC’s pension– £530 million (2017/18: £518 million).
scheme arrangements and assessed
Refer to note C6 (financial disclosures)the processes and controls used by
and note H (accounting policies) andmanagement to account for them.
the risks set out in the Audit and Risk
Using actuarial experts I have assessed
Committee report on page 122.
the reasonableness of key assumptions
The BBC has a significant pension deficit.
used in determining the scheme
The scheme was subject to triennial
liability, benchmarking them against
valuation at March 2016, and the BBC
other schemes; and I have assessedand pension scheme trustees havethe nature and appropriateness ofagreed a revised repayment plan to
BBC context-specific assumptions. I
reduce the scheme deficit. The valuation
have also assessed the expertise andof the net pension liability reported in
independence of the BBC’s actuaries.
the accounts is highly judgemental, andI have taken assurance from the workchanges to assumptions can result inof the BBC Pension Scheme auditors inmaterial changes to the valuation. Given
relation to the valuation of scheme assets.
this, I have assessed the valuation of
the pension deficit as a significant risk
I have tested data inputs used
to my audit. The March 2019 triennial
in determining the valuation,
valuation is underway and I will consider
including employer contributions
its implications for my audit next year.
and scheme membership data.

The findings I communicatedto the Audit and Risk Committee

I am satisfied that the methodology
and approach adopted by the BBC isappropriate for the valuation of thepension scheme liability in the BBC’s
consolidated financial statements.
My challenge of the reasonableness ofassumptions has found that these all sit
within the range I would expect whencompared to market practice. I consider
that the disclosures relating to pension
assets and liabilities comply with therequirements of accounting standards.

I have tested the accounting entries
recognised to the underlying work
performed by the BBC’s actuaries
and reviewed disclosures made toconfirm these are in accordancewith accounting standards.
Accounting for investments in associates and joint ventures
Total value of interests in associates andGiven the significant levels of management
joint ventures – £257 million. (2017/18:
judgement involved in determining the£240 million). Refer to note E3 (financial
appropriate group accounting treatment
disclosures) and note H (accounting
and the sensitivity of the consolidated
policies) and the risks set out in the Audit
financial statements to these judgements,
and Risk Committee report on page 122.
I have assessed the accounting treatmentof the following BBC investments as giving
The BBC Group comprises over 100
rise to a significant risk to my audit:
separate subsidiaries and over 60
associates and joint ventures. On preparing
A. Daunus Limited: Daunus Limited is a
its consolidated financial statements,
special purpose vehicle establishedthe BBC must make judgements aroundas part of the sale and leaseback
the control exercised over each entity toarrangement which facilitated thedetermine whether to consolidate theredevelopment of New Broadcasting
entity or recognise it as an associate,
House. The financial statements arejoint venture or investment.
highly sensitive to the accounting
treatment adopted, as this judgement
When consolidating entities into thehas a material impact on the financial
BBC’s consolidated financial statements,
statements and the BBC’s outturn
there are risks associated with theagainst its borrowing limits.
completeness of adjustments madeto eliminate intra-group transactions
and adjustments made to recognise
the assets, liabilities and results ofsubsidiaries, associates and joint ventures.

I am satisfied that the group consolidation
has been properly performed. This includes
the decision not to consolidate the financial
statements of UKTV Media Holdings, where
the BBC considers control did not pass until
after the year-end.
I am content that the accounting treatment
adopted in respect of the BBC Group’s
investments in associates and joint ventures
is appropriate.

Management must also exercise
judgement as to the valuation
attributed to its investments, within the
consolidated financial statements.

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F I N A N C I A L S TAT E M E N T S

Key audit matter description

The findings I communicatedto the Audit and Risk Committee

The scope of my audit work in response

Key audit matters relating to my opinion on the financial statements
Accounting for investments in associates and joint venture continued
B. UKTV Media Limited: given UKTV’s
significance to the BBC’s financial
statements. UKTV is held by the BBC
in a joint venture arrangement with
Discovery Inc. In April 2019, BBC
Studios announced it would enter
into an agreement with Discovery
Inc so that BBC Studios would takefull control of UKTV’s entertainment
channels. This deal concluded in June
2019. In light of this announcement,
there are risks associated with theassessment of control at 31 March
2019 and reporting of the acquisitionin the post-balance sheet period
under IFRS 3, Business Combinations.
C.

New Video Channel America LLC:
as BBC Studios Distribution
owns 50.1% of this entity but
does not consolidate it.

I performed the following procedures inrelation to each of these investments:

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Daunus Limited: I assessed thereasonableness of management’s
past judgement on the treatment of
its investment in Daunus Limited as
an equity-accounted joint venture. My
audit procedures included considering
the reasonableness of management’s
key assumptions and judgements,
checking these for consistency
with the underlying contractual
documentation and obtaining evidence
that, in practice, joint control is
exercised over the relevant activities
of Daunus. I have assessed thereasonableness of the valuation of
the Daunus investment by reference
to Daunus’s audited accounts.

B.

UKTV Media Limited: I havereviewed the underlying contractual
documentation in place and assessedmanagement’s treatment of UKTV
as a joint venture in the financial
statements. I have consideredmanagement’s assessment of
whether indicators of control
existed at 31 March 2019 and thesufficiency of disclosures of theacquisition of UKTV’s entertainment
channels in the post-balance sheet
period. Through my group audit
procedures I have confirmed the
BBC Group’s share of UKTV Media
Limited’s underlying profits.

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Key audit matter description

The scope of my audit work in response

The findings I communicatedto the Audit and Risk Committee

Key audit matters relating to my opinion on the financial statements
Accounting for investments in associates and joint ventures continued
C. New Video Channel America LLC:
I have reviewed the past judgement
that, although BBC Studios
Distribution owns 50.1% of New
Video Channel America, it does notcontrol the entity and therefore does
not consolidate it on a line-by-line
basis. I have reviewed underlying
contractual agreements andminutes of the relevant Board andcommittee meetings to understandthe substance of the arrangementin place. Through my group audit
procedures I have confirmed the BBCGroup’s share of New Video Channel
America LLC’s underlying profits.
I assessed the controls established by
the BBC to consolidate the transactions
and balances relating to its subsidiary
entities, and to completely and accurately
process consolidation adjustments andappropriately eliminate intra-grouptransactions. I tested the consolidation
process using group audit procedures andsample testing of intra-group transactions.
I set out further information on my groupaudit procedures later in this report.
Accounting for programme assets
Total value of programme assets –£743 million (2017/18: £726 million).
Refer to note B3 (financial disclosures)and note H (accounting policies) andthe risks set out in the Audit and Risk
Committee report on page 122.
The BBC capitalises the costs associatedwith making a programme as work-inprogress during the course of a production,and releases these assets from theStatement of Financial Position at the
point a programme is delivered (in thecase of BBC Studios) or transmitted (in thecase of the Public Service Broadcaster).
At the point these programme assets are
released, revenue and costs are recognisedin the Consolidated Income Statement
as appropriate. Where costs have been
capitalised and remain as work-in-progressat the year end, management must
consider whether there are any indicatorsof impairment: for example, where a
programme may no longer be broadcast.
The valuation of programme assets is ahighly material estimate in the accounts,
and there is a significant amount ofjudgement over both the initial value
and the impairment of these assets.

194

I have assessed the policy adopted bymanagement in respect of programme
asset as a key accounting judgement,
including an assessment against IFRS
and the wider practice within the media
industry. This included undertaking
walkthroughs of the process for valuing
programme assets and the end-to-end
process following a programme life-cycle
through the various BBC entities, to ensure
a consistent approach to the recognitionof costs and revenue and that this isappropriately addressed on consolidation.

I consider programme assets to beappropriately accounted for in the BBC’s
consolidated financial statements.

I substantively tested a sample ofprogramme assets to confirm that these
had been accounted for in accordancewith the policy adopted by management.
I understood and evaluated the approachto managing production costs andidentifying indicators of impairment
and considered potential indicators of
impairment of programme assets throughmy wider understanding of the business.
This included a review of Board minutes,
considering wider information, and holding
discussions with the programme andproduction accounting teams to assess
the controls over programme spend.

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F I N A N C I A L S TAT E M E N T S

Key audit matter description

The scope of my audit work in response

The findings I communicatedto the Audit and Risk Committee

Key audit matters relating to my opinion on the financial statements
Accounting for programme assets continued
There is a risk that the approachto valuation will result in material
misstatement of the balance sheet,or that the processes to identify
impairment of programme assets
are not sufficient to identify material
overstatement of the balance sheet.
In 2017/18, I identified accounting for
programme assets as a risk within myseparate audits of BBC Commercial
Holdings Ltd and BBC Studios Ltd.
During 2018/19, BBC Studios Group
reviewed the process for accounting for
programme assets, in particular aroundthe allocation of overheads to individual
programmes which had resulted in
audit adjustments in 2017/18. In lightof these developments, along with theincreasing value of programme assets
and the number of arrangements enteredinto with parties outside of the BBCGroup, I consider it appropriate to also
consider this a risk at BBC Group level.

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BBC Group Annual Report and Accounts 2018/19

195

F I N A N C I A L S TAT E M E N T S

Application of materiality
I applied the concept of materiality
in both planning and performing myaudit, and in evaluating the effect of
misstatements on my audit and on thefinancial statements. This approach
recognises that financial statements are
rarely absolutely correct, and that anaudit is designed to provide reasonable,
rather than absolute, assurance that thefinancial statements are free from material
misstatement or irregularity. A matter ismaterial if its omission or misstatement
would, in the judgement of the auditor,
reasonably influence the decisions ofusers of the financial statements.
Groupmateriality

Overallmateriality£25 million(2017/18:
same)

Benchmark0.5% ofGroup
revenue(2017/18:
same)

Performance £18.75 million 75% ofmateriality (2017/18:
overallsame)materiality(2017/18:
same)
Reportingthreshold£250,000(2017/18:
same)

Based on my professional judgement, I
determined the overall materiality for theBBC’s consolidated financial statements
at £25 million, which is approximately
0.5% of BBC Group revenue. I chose thisbenchmark because, in my professional
judgement, income is the key driver of theBBC’s business; in particular, licence feerevenue and commercial income generated
by the BBC is a key driver of stakeholderinterest. Parliament and the public havean interest in the way in which the BBC isfunded and how it spends its funds. The
level of licence fee revenue and commercial
income determines the resources available
to the BBC and drives strategic decisions
around spending and investment.
As well as quantitative materiality there
are certain matters that, by their very
nature, would if not corrected influence
the decisions of users, for example:—

remuneration disclosures;—

matters that could result in a
modification of the regularity opinion;
and

—

196

any adjustment that would affect theoverall position of the primarystatements at the margin; for example
that would result in the surplus
reported in the consolidated income
statement becoming a deficit, or
vice-versa.

Assessment of such matters would
need to have regard to the nature of
the misstatement and the applicablelegal and reporting framework, as wellas the size of the misstatement.
I applied the same concept of materiality
to my audit of regularity. In planningand performing audit work in support of
my opinion on regularity and evaluating
the impact of any irregular transactions,
I took into account both quantitativeand qualitative aspects that I consider
would reasonably influence the decisionsof users of the financial statements
I have also reported any unadjusted
misstatements exceeding my reporting
threshold of £250,000 to the BBC Audit& Risk Committee, as well as differences
below this threshold that, in my view,
warranted reporting on qualitative grounds.
Total unadjusted audit differences reported
to the Audit Committee have decreased
net expenditure and increased net assets
by £nil.

error, design and perform audit
procedures responsive to those risks,and obtain audit evidence that is
sufficient and appropriate to provide abasis for my opinion. The risk of notdetecting a material misstatement
resulting from fraud is higher than for
one resulting from error, as fraud may
involve collusion, forgery, intentionalomissions, misrepresentations, or theoverride of internal control.
—

Obtain an understanding of internal
control relevant to the audit in order todesign audit procedures that areappropriate in the circumstances, but
not for the purpose of expressing an
opinion on the effectiveness of theBBC’s internal control.

—

Evaluate the appropriateness ofaccounting policies used and thereasonableness of accounting
estimates and related disclosures
made by management.

—

Conclude on the appropriateness ofmanagement’s use of the going
concern basis of accounting and, basedon the audit evidence obtained,
whether a material uncertainty exists
related to events or conditions that
may cast significant doubt on the
BBC’s ability to continue as a going
concern for a period of at least twelve
months from the date of approval of
the financial statements. If I conclude
that a material uncertainty exists, I am
required to draw attention in myauditor’s report to the related
disclosures in the financial statements
or, if such disclosures are inadequate,
to modify my opinion. My conclusions
are based on the audit evidence
obtained up to the date of my auditor’sreport. However, future events orconditions may cause the entity tocease to continue as a going concern.

—

Evaluate the overall presentation,
structure and content of the financial
statements, including the disclosures,and whether the consolidated financial
statements represent the underlying
transactions and events in a mannerthat achieves fair presentation.

—

Obtain sufficient appropriate audit
evidence regarding the financial
information of the entities or businessactivities within the group to express
an opinion on the consolidated
financial statements. I am responsible
for the direction, supervision andperformance of the group audit.
I remain solely responsible formy audit opinion.

Respective responsibilities of the BBC
Board and the Comptroller and Auditor
GeneralAs explained more fully in the Statementof Board Responsibilities, the Board
is responsible for the preparation of
the consolidated financial statements
and for being satisfied that they givea true and fair view and conform to
the authorities which govern them.
My responsibility is to audit andexpress an opinion on the financial
statements in accordance withapplicable law and International
Standards on Auditing (ISAs) (UK).
An audit involves obtaining evidence about
the amounts and disclosures in the financial
statements sufficient to give reasonableassurance that the financial statements arefree from material misstatement, whether
caused by fraud or error. Reasonableassurance is a high level of assurance, but
is not a guarantee that an audit conductedin accordance with ISAs (UK) will always
detect a material misstatement when
it exists. Misstatements can arise fromfraud or error and are considered material
if, individually or in the aggregate, they
could reasonably be expected to influence
the economic decisions of users taken on
the basis of these financial statements.
As part of an audit in accordancewith ISAs (UK), I exercise professional
judgement and maintain professional
scepticism throughout the audit. I also:—

Identify and assess the risks of material
misstatement of the financial
statements, whether due to fraud or

BBC Group Annual Report and Accounts 2018/19

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F I N A N C I A L S TAT E M E N T S

I communicate with those charged
with governance regarding, among
other matters, the planned scope andtiming of the audit and significant
audit findings, including any significant
deficiencies in internal control
that I identify during my audit.

Level 1: BBC GroupI also provide those charged withgovernance with a statement that
I have complied with relevant ethicalrequirements regarding independence, andto communicate with them all relationships
and other matters that may reasonably
be thought to bear on my independence,
and where applicable, related safeguards.

Sampled non-significant components
None – due to coverage achieved
from significant components

From the matters communicated withthose charged with governance, I determine
those matters that were of mostsignificance in the audit of the financial
statements of the current period and are
therefore the key audit matters. I describe
these matters in my auditor’s report
unless law or regulation precludes public
disclosure about the matter or when, in
extremely rare circumstances, I determinethat a matter should not be communicatedin my report because the adverse
consequences of doing so would reasonably
be expected to outweigh the public
interest benefits of such communication.
In addition, I am required to obtain evidence
sufficient to give reasonable assurance
that the income and expenditure reported
in the financial statements conform to
the authorities which govern them.
Group audit approach
The scope of my Group audit wasdetermined by obtaining an understandingof the Group and its environment, includingGroup-wide controls, and assessing therisks of material misstatement at theGroup level.
The BBC Group comprises over 100
subsidiaries, along with a number ofassociates and joint ventures. There
are three levels of consolidation
within the BBC Group:———

Level 1: BBC Group, comprising the
BBC Public Service Broadcaster (PSB),
PSB subsidiaries, and BBC Commercial
Holdings Group;
Level 2: BBC Commercial HoldingsGroup, comprising BBC Commercial
Holdings Limited and subsidiarycompanies, including, BBC Studios
Group, BBC Global News companies,
BBC Studioworks Limited and BBC
Children’s Productions Limited; andLevel 3: BBC Studios Group,comprising BBC Studios Productions
Limited, BBC Studios Distribution
Limited and subsidiary companies.

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Total revenue: £4,889m

Significant components and auditors— BBC Public Service Broadcaster (NAO)—

Full scope audit
Analytical procedures

BBC Commercial Holdings Group(NAO)

Analytical procedures on non-significant
components
We performed analytical procedures on theremaining components.

Level 2: BBC Commercial
Holdings Group

Total revenue: £1,542m

Significant components and auditors— BBC Studios Ltd (NAO)—

BBC Global News Ltd (NAO)—

BBC Commercial Holdings Ltd (NAO)

Full scope audit
Analytical procedures

Sampled non-significant components— BBC Studioworks Ltd (NAO)—

BBC Children’s Productions Ltd (NAO)

Analytical procedures on non-significant
components
We performed analytical procedures on theremaining components.

Level 3: BBC Studios Group
Significant components and auditors— BBC Studios Productions Ltd (NAO)—

BBC Studios Distribution Ltd (NAO)—

2 entertain Videos Ltd (NAO)—

UK Programme Distribution Ltd (NAO)—

BBC Studios Australia Pty Limited(Grant Thompson)—

BBC Studios Americas incorporated
(NAO)

—

New Video Channel America LLC(KPMG)—UKTV Media Holdings Ltd (KPMG)

Total revenue: £1,189m
Full scope audit
Analytical procedures

Sampled non-significant components— BBC Worldwide France SARL (KPMG)—

BBC Grafton House Productions Ltd
(NAO)

—

BBC Natural History and Factual
Productions Ltd (NAO)—

BBC Comedy Productions Ltd (NAO)

Analytical procedures on non-significant
components
We performed analytical procedures on theremaining components.

BBC Group Annual Report and Accounts 2018/19

197

F I N A N C I A L S TAT E M E N T S

This audit opinion relates to the BBCGroup, at level 1. My group audit approachhas been designed to enable me to form
an opinion on these consolidated financial
statements, and my assessment ofsignificant components and the nature of
the work I have performed is as follows:
I have had direct involvement in theaudit strategy of the BBC’s significant
components, including those significant
components where I have not been
appointed as auditor. I have issued Group
Audit Instructions to all significant
components by size and risk and also to asample of other components, which enable
me to obtain the necessary assurances
required for my audit opinion on the
BBC’s consolidated financial statements.
For significant components where I havenot been appointed as auditor, I havemet and discussed the audit strategy,
significant audit risks and findings fromcomponent auditors’ work. For thesecomponent audits I have also met withcomponent management and attended
planning and closing meetings. Under
the terms of the Group Audit Instructions
I issued, full statutory audit proceduresin accordance with local adaptationsof International Standards on Auditing
have been conducted and I have satisfied
myself that sufficient work has been
undertaken to provide the necessary
assurances for my audit opinion on the
BBC’s consolidated financial statements.
The components subject to theseprocedures are described as ‘full scope
audit’ components in the table on page 197.
For other components I have undertaken
other procedures to gain the necessary
assurances for my audit opinion on the
BBC’s consolidated financial statements.
This included evaluating and testing theBBC’s group-wide controls, and performing
analytical and enquiry procedures toaddress the risk of residual misstatement.
Other information
The BBC Board is responsible for theother information. The other information
comprises information included in the
Annual Report, other than the parts of
the Remuneration Report described inthat report as having been audited, thefinancial statements and my auditor’sreport thereon. My opinion on the financial
statements does not cover the otherinformation and I do not express any
form of assurance conclusion thereon. In
connection with my audit of the financial
statements, my responsibility is to readthe other information and, in doing so,
consider whether the other information ismaterially inconsistent with the financial
statements or my knowledge obtainedin the audit or otherwise appears to be198

materially misstated. If, based on the work
I have performed, I conclude that there
is a material misstatement of this otherinformation, I am required to report thatfact. I have nothing to report in this regard.

Based on my knowledge andunderstanding of the BBC and its
environment obtained during the courseof the audit, I have identified no material
misstatements in these reports.

I am specifically required to address thefollowing items and to report uncorrectedmaterial misstatements in the otherinformation, where I conclude that those
items meet the following conditions:

The corporate governance statement
In my opinion, based on the work
undertaken in the course of the audit,
the information given in the corporate
governance statement in respect of internal
control and risk management systems in
relation to financial reporting processes is
consistent with the accounts and has been
prepared in accordance with applicable law.

——fair, balanced and understandable: thestatement given by the directors that
the Annual Report and Accounts taken
as a whole are fair, balanced andunderstandable and provide thenecessary information to enable users
to assess the entity’s performance,business model and strategy, ismaterially inconsistent with myknowledge obtained in the audit; orAudit and Risk Committee reporting:the section describing the work of theGroup Audit & Risk Committee does
not appropriately address matterscommunicated by me to the Audit
Committee.

I also have nothing to report in this regard.
Other matters prescribed by the terms of
my engagement
Remuneration
In addition to my audit of the BBC’s
consolidated financial statements, theBoard has engaged me to audit the
information in the Board Remuneration
Report that is described as having been
audited, which the Board has decided
to prepare as if the BBC were required
to comply with the requirements of
Schedule 8 to The Large and Medium-sizedCompanies and Groups (Accounts andReports) Regulation 2008 (SI 2008 No 410)
made under the Companies Act 2006.
In my opinion the parts of the Board
Remuneration Report which I have been
engaged to audit have been properly
prepared in accordance with Schedule 8 to
the Large and Medium-sized Companies
and Groups (Accounts and Reports)
Regulation 2008, as if those requirements
were to apply to the BBC Group.
I also report to you if, in my opinion, certain
disclosures of directors’ remuneration
required have not been made. I havenothing to report arising from this duty.
The Strategic and Governance reports
In my opinion, based on the work
undertaken in the course of the audit, theinformation given in the Strategic andGovernance reports for the financial year
are consistent with the financial statements
and have been prepared in accordancewith applicable legal requirements.

BBC Group Annual Report and Accounts 2018/19

In my opinion, based on the work
undertaken in the course of the audit,
rules 7.2.2, 7.2.3 and 7.2.7 in the
Disclosure Rules and Transparency Rules
sourcebook made by the Financial Conduct
Authority have been complied with.
Based on my knowledge andunderstanding of the BBC and its
environment obtained during the courseof the audit, I have identified no material
misstatements in this information.
Matters on which I report by exception
Adequacy of accounting records
information and explanations received
I report to you if, in my opinion:—adequate accounting records have notbeen kept, or returns adequate for myaudit have not been received frombranches not visited by my staff;—

the financial statements and the partof the Remuneration report to beaudited are not in agreement with theaccounting records and returns;—

certain disclosures of directors’
remuneration specified by law are not
made;

—

I have not received all of theinformation and explanations I require
for my audit; or—a corporate governance statement has
not been prepared.

I have nothing to report arising fromthis duty.
The Board’s assessment of principal risks
and future prospects
Under International Standards on Auditing(UK & Ireland), I am required to report
to you if I have anything material to add,
or to draw attention to, in relation to
the Board’s disclosures in the Annual
Report and Financial Statements:—

confirming that they have carried out
a robust assessment of principal risksfacing the BBC, including those thatwould threaten its business model,
future performance, solvency
or liquidity;
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F I N A N C I A L S TAT E M E N T S—

describing those risks and explaining
how they are being managed or
mitigated;—

on whether they considered it
appropriate to adopt the going
concern basis, and their identificationof any material uncertainties to theentity’s ability to continue over a
period of at least 12 months from thedate of approval of the financial
statements; and—explaining how they have assessed theprospects of the entity, over what period
they have done so and why they
consider that period to be appropriate,
and their statement as to whether they
have a reasonable expectation that the
BBC will be able to continue in operationand meet its liabilities as they fall due
over the period of their assessment,
including any related disclosures
drawing attention to any necessary
qualifications or assumptions.

I have nothing material to add, or to
draw attention to, on these matters.
ReportMy report is set out on page 200.

Gareth Davies
Comptroller and Auditor General
National Audit Office157-197 Buckingham Palace Road
London, SW1W 9SP
21 June 2019

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BBC Group Annual Report and Accounts 2018/19

199

F I N A N C I A L S TAT E M E N T S

The Report of the Comptroller and
Auditor General to the Board of the
British Broadcasting Corporation,
acknowledging that Parliamentalso places reliance on theGroup Accounts and Report
Other than those observations I have set out above, including
those in my Opinion on regularity and in the Basis for myqualified regularity opinion which relate to the BBC’s recognitionof a £12 million provision as disclosed in Note F10, I have nofurther observations to make on these financial statements.

Gareth Davies
Comptroller and Auditor General
National Audit Office157-197 Buckingham Palace Road
London, SW1W 9SP
21 June 2019200

BBC Group Annual Report and Accounts 2018/19

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F I N A N C I A L S TAT E M E N T S

The BBC’s consolidated financial statements
These financial statements
comprise both the primarystatements and additional
supporting disclosure notes.
The primary statements are:Consolidated income statement
The income the BBC receives and expenditure incurred by theGroup’s operations during the financial year.
Consolidated statement of comprehensive (loss)/income
Items of income and expense, including reclassification
adjustments, that are not directly recognised in the income
statement and hence are charged or credited directly against
or to reserves.
Consolidated balance sheet
The statement of the assets and liabilities of the BBC at a specificpoint in time, the financial year end.
Consolidated statement of changes in equity
Components that make up the capital and reserves of the Groupand the changes to each component during the financial year.
Consolidated cash flow statement
Cash generated by the BBC from its operations and how thosecash flows have been used.

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201

F I N A N C I A L S TAT E M E N T S

Consolidated income statement
Note

2019
£m

2018
£m

Licence fee income
Other income

A1
A1

3,690
1,199

3,830
1,232

Total income

A1

4,889

5,062

Total operating costs
Share of results of associates and joint ventures

A1
E3(4,977)36(4,854)36

Group operating (deficit)/surplus
Gains on disposal
Other gains and losses
Net financing costs

G4
G5
F11

(52)
36
7
(65)

244
5
25
(95)

(Deficit)/surplus before taxation
Taxation

G1.1

(74)
5

179
1

(Deficit)/surplus for the year

(69)

180

Attributable to:BBC
Non-controlling interests

(70)
1

179
1

(Deficit)/surplus for the year

(69)

180

Consolidated statement of comprehensive (loss)/income
Note(Deficit)/surplus for the year
Other comprehensive income:Remeasurement on defined benefit pension schemes

C6.2

Total items that will not be reclassified to the income statement in the future
Currency translation adjustment
Gains on cash flow hedges
Deferred tax charge on financial instruments

G7.3
G7.2

2019
£m

2018
£m

(69)

180

38

737

38

737

15
2
(1)

(29)
26
(5)

Total items that may be reclassified to the income statement in the future

16

(8)

Other comprehensive income net of tax

54

729

Total comprehensive (loss)/income for the year

(15)

909

Attributable to:BBC
Non-controlling interests

(16)
1

908
1

Total comprehensive (loss)/income for the year

(15)

909

202

BBC Group Annual Report and Accounts 2018/19

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F I N A N C I A L S TAT E M E N T S

Consolidated balance sheet
As at 31 March
2019
£m

2018
£m

247
1,028
70
257
38
–
449
8

233
1,038
74
240
64
1
429
6

2,097

2,085

743
1,131
4
2
29
468

726
975
–
9
36
523

2,377

2,269

(1,014)
(119)
(30)
(83)
(3)
(7)

(1,054)
–
(19)
(56)
(5)
(12)

(1,256)(1,146)

(43)
(21)
(824)
(60)
(552)
(16)
(530)

(79)
–
(838)
(48)
(518)
(14)
(518)

(2,046)(2,015)

1,172

1,193

1,162
1
34
(27)

1,199
–
19
(27)

Non-controlling interests

1,170
2

1,191
2

Total capital and reserves

1,172

1,193

Note

Non-current assets
Intangible assets (including goodwill)
Property, plant and equipment
Investment properties
Interests in associates and joint ventures
Trade and other receivables
Investments
Derivative financial instruments
Deferred tax assets

E1
D1
D2
E3
F7.1
G3.2
G1.5

Current assets
Programme-related assets and other inventories
Trade and other receivables
Contract assets
Derivative financial instruments
Current tax assets
Cash and cash equivalents
Current liabilities
Trade and other payables
Contract liabilities
Borrowings
Provisions
Derivative financial instruments
Current tax liabilities

B3
F7.2
A4.3
G3.2
G1.4
F1

F9.2
A4.3
F4.1
F10
G3.2

Non-current liabilities
Trade and other payables
Contract liabilities
Borrowings
Provisions
Derivative financial instruments
Deferred tax liabilities
Pension liabilities

F9.1
A4.3
F4.2
F10
G3.2
G1.5
C6.1

Net assets
Attributable to the BBC:Operating reserve
Hedging reserve
Translation reserve
Other reserves

G7.1
G7.2
G7.3
G7.4

The financial statements were approved by the Board and authorised for issue on 20 June 2019, and signed on their behalf by:

Tony Hall
Director-General

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Glyn Isherwood
Chief Financial Officer

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203

F I N A N C I A L S TAT E M E N T S

Consolidated statement of changes in equity

Note

At 1 April 2017
Surplus for the year
Currency translation
adjustment
Cash flow hedges
Deferred tax on financial
instruments
Remeasurement ofdefined benefit pension
scheme

G7.3
G7.2

C6.2

Total comprehensive
income/(loss) for the year
Release of financial assets
Changes in non-controllinginterest
At 31 March 2018 aspreviously stated*
First-time adoption of IFRS15**
At 31 March 2018
Restated(Deficit)/surplus for theyear
Currency translation
adjustment
Cash flow hedges
Deferred tax on financial
instruments
Remeasurement ofdefined benefit pension
schemeTotal comprehensive (loss)/income for the year
Dividends declared in year
At 31 March 2019

G7.3
G7.2

C6.2

Operatingreserve£m

Hedging
reserve£m

Translation
reserve£m

Otherreserves
£m

Total
£m

Noncontrollinginterests
£m

Total
£m

283

(21)

48

(2)

308

–

308

179

–

–

–

179

1

180

–
–

–
26

(29)
–

–
–

(29)
26

–
–

(29)
26

–

(5)

–

–

(5)

–

(5)

737

–

–

–

737

–

737

916
–

21
–

(29)
–

–
(3)

908
(3)

1
–

909
(3)

–

–

–

(22)

(22)

1

(21)

1,199

–

19

(27)

1,191

2

1,193

(5)

–

–

–

(5)

–

(5)

1,194

–

19

(27)

1,186

2

1,188

(70)

–

–

–

(70)

1

(69)

–
–

–
2

15
–

–
–

15
2

–
–

15
2

–

(1)

–

–

(1)

–

(1)

38

–

–

–

38

–

38

(32)
–

1
–

15
–

–
–

(16)
–

1
(1)

(15)
(1)

1,162

1

34

(27)

1,170

2

1,172

*

The Group has applied IFRS 15 Revenue from Contracts with Customers using the cumulative effect method. Under this method, the comparative information is not restated.
See note A4.
** See accounting policies in section H.

204

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F I N A N C I A L S TAT E M E N T S

Consolidated cash flow statement
Note

Operating activities
Cash generated from operations
Tax reimbursed

F6

Net cash from operations
Investing activities
Interest received
Financing income relating to swap transactions
Dividends received from associates and joint ventures
Dividends paid to non-controlling interests
Proceeds from sale of operations
Proceeds from disposal of investments
Proceeds from disposal of associates and joint ventures
Acquisition of interests in associates and joint ventures
Acquisition of subsidiary net of cash acquired
Purchases of other intangible assets
Purchases of property, plant and equipment

F11
E3

Net cash used in investing activities
Financing activities
Interest paid
Proceeds from increase in borrowings
Repayments of borrowings
Payment of obligations under finance leases

F11

2019
£m

2018
£m

255
6

583
6

261

589

9
11
27
(1)
32
–
–
(4)
(2)
(192)
(130)

6
10
39
–
–
9
2
(12)
(8)
(157)
(126)

(250)

(237)

(4)
11
(2)
(73)

(8)
–
(3)
(74)

Net cash used in financing activities

(68)

(85)

Net (decrease)/increase in cash and cash equivalents

(57)

267

Cash and cash equivalents at beginning of the year
Effect of foreign exchange rate changes on cash and cash equivalents

F2

523
2

256
–

Cash and cash equivalents at the end of the year

F2

468

523

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BBC Group Annual Report and Accounts 2018/19

205

KEY THEMES

Key themes for the BBC
Page

A. Where the BBC’s income comes from
Income and operating results

Income analysis

Licence fee income

Contribution of commercial operations

207

B. How the BBC spends the funds
Total operating costs

Programme-related assets and other inventories

212

R elated party transactions with key management personnel
Group pension plans

214

Analysis of total operating costs by commercial activities
C. What the BBC spends on its people
Persons employed and remuneration
Key management personnel compensation

D. The property, technology and equipment used by the BBC to make and distribute its programmes
Investment properties

220

Interests in associates and joint ventures

221

Cash and cash equivalents

Expected credit losses

224

Analysis of net funds

Trade and other payables

Borrowings and borrowing facilities

Provisions and contingent liabilities

Property, plant and equipment
E. Investments in the BBC’s commercial activities
Intangible assets
Goodwill
F. Managing funding (including future costs)

Cash generated from operations

Net financing costs

Trade and other receivables

Long-term commitments not reflected in the balance sheet

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F I N A N C I A L S TAT E M E N T S

Notes to the accounts
A. Where the BBC’s income comes fromThe BBC generates its income from a number of key sources, each source funding different parts of the BBC’s activity. The notes in thissection provide information on the performance in the year for each segment of the BBC Group.
The distinction between the various income sources is important as the BBC must not cross-subsidise its commercial activities throughits PSB Group or grant-funded activities. However, the performance of the Group’s commercial activities generates profits that are
distributed back to the BBC and contribute towards the funding of PSB Group activities.
The BBC’s operating segments are reported in a manner consistent with the internal reports provided to the BBC Board, who areresponsible for making strategic decisions, allocating resources and assessing performance of the operating segments.
Segmental information provided to the BBC Board is aligned to the BBC’s income sources. The reportable segments are:—

PSB Group – Primarily receives licence fee income and is responsible for the Group’s Public Service activities;—

BBC Studios – Generates income from exploiting the various assets of the BBC, for example by licencing programme formats, sellinginternational rights, merchandising and production facilities. Income is also generated through subscription fees from the broadcastof the group’s channels on pay television platforms and from the production of programme content across factual, drama, comedy
and entertainment genres; and—Other commercial – These have been aggregated for reporting purposes as they meet the conditions set out in IFRS 8 Operating
Segments. This includes the Global News group, BBC Studioworks Limited, BBC Children’s Productions Limited and the commercial
holding companies.

The BBC Studios group was reported as two separate segments, BBC Studios Distribution Limited and BBC Studios Productions Limited,in the previous year. These have been reported as one group to the Board throughout the current year.
Group adjustments reflect eliminations required for trading activity between the segments detailed above.
The prices charged for services provided between the PSB Group and the commercial activities are determined on an arms length basis
in accordance with Ofcom’s Trading and Separation Obligations and the BBC’s published transfer pricing methodologies.
The BBC has adopted IFRS 15 Revenue from Contracts with Customers during the year, resulting in additional disclosures on the different
types of income streams by segment and information on the timing of income recognition.
Included within this section is additional information to meet Ofcom’s Commercial and Trading Reporting requirements, for example theincome breakdown within note A3.

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N O T E S T O T H E AC C O U N T S

A. Where the BBC’s income comes from continued
A1 Income and operating results
2019

Note

PSB Group£m

BBC Studios
£m

Other
commercials
£m

Group
adjustments
£m

Group
£m

Licence fee income

A2

3,690

–

–

–

3,690

A4.2

187
89
46
5

1,189
–
–
–

183
–
–
–

(484)
–
(16)
–

1,075
89
30
5

327

1,189

183

(500)

1,199

A3

4,017

1,189

183

(500)

4,889

B1

(151)
(3,925)

(173)
(967)

(3)
(175)

–
417

(327)
(4,650)B2(4,076)(1,140)

(178)

417

(4,977)

Total income from contracts withcustomers
Grant income
Rental and associated income
Other income
Total other income
Total income
Depreciation and amortisation
Other operating costs
Total operating costs
Share of results of associates and joint
ventures

–

36

–

–

36

Group operating (deficit)/surplus
Gains on disposal
Other gains and losses

(59)
–
–

85
36
15

5
–
(8)

(83)
–
–

(52)
36
7

Operating segment result

(59)

136

(3)

(83)

(9)

E3

Financing income
Financing costs

F11
F11

23
(88)

Net financing costs

F11

(65)

Deficit before taxation
Taxation

G1.1

(74)
5

Deficit for the year

(69)

2018*

Note

PSB Group£m

BBC Studios
£m

Other
commercials
£m

Group
adjustments
£m

Group
£m

Licence fee income

A2

3,830

–

–

–

3,830

A4.2

161
88
44
8

1,236
–
–
–

159
–
–
–

(451)
–
(13)
–

1,105
88
31
8

301

1,236

159

(464)

1,232

A3

4,131

1,236

159

(464)

5,062

B1

(153)
(3,942)(185)(1,014)

(1)
(161)

–
602

(339)
(4,515)B2(4,095)(1,199)

(162)

602

(4,854)

Total income from contracts withcustomers
Grant income
Rental and associated income
Other income
Total other income
Total income
Depreciation and amortisation
Other operating costs
Total operating costs
Share of results of associates and joint
ventures

E3Group operating surplus/(deficit)
Gain on disposal of non-current assets
Other gains
Operating segment result

–

36

–

–

36

36
–
–

73
5
9

(3)
–
16

138
–
–

244
5
25

36

87

13

138

274

Financing income
Financing costs

F11
F11

26
(121)

Net financing costs

F11

(95)

Surplus before taxation
Taxation

G1.1

179
1

Surplus for the year*

180

The presentation of this table has been amended to reflect the disclosure requirements of IFRS 15 Revenue from Contracts with Customers.

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F I N A N C I A L S TAT E M E N T S

A. Where the BBC’s income comes from continued
A2 Licence fee income
Licence fee
2019£

Licences in force
2019
Number ‘000

Total income
2019£mLicence fee
2018£

Licences in force
2018
Number ‘000

Total income
2018£m

150.50
50.50
7.50
–

21,408
5
167
4,603

3,205
–
1
468

147.00
49.50
7.50
–

21,611
6
167
4,455

3,157
–
1
655

26,1833,674
16

26,239Quarterly payment scheme premium

3,813
17

Total licence fee income

3,690

Colour
Monochrome
Concessionary
Over 75s

3,830

During the year, 3 million (2018: 3 million) colour licences were issued under the quarterly payment scheme at a premium of £5 each(2018: £5).
Households in which one or more persons over the age of 75 reside, as their primary residence, are entitled to a free licence. The
obligation for the BBC to take over the funding for free TV licences for the over-75s was phased in from April 2018 and will be fully
handed over in 2020, at which point the BBC will no longer receive any funding from the Department for Work and Pensions for over-75s.
A3 PSB income
2019

2018

External income£mIntra-group
income£m

Total income£mExternal income£mIntra-group
income£m

Total income
£m

3,690

–

3,690

3,830

–

3,830

11
29
16
2

32
8
16
–

43
37
32
2

10
28
16
1

31
6
18
1

41
34
34
2

21
20

1
31

22
51

16
7

1
26

17
33

Total income from contracts withcustomers

99

88

187

78

83

161

Grant income
Rental and associated income
Other income

89
30
5

–
16
–

89
46
5

88
31
7

–
13
1

88
44
8

Total other income

124

16

140

126

14

140

3,913

104

4,017

4,034

97

4,131

Licence fee income
Content and format sales
Production fees
Royalties
Advertising income
Consumer products(including ticket sales)
Other contract income

Total income

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209

N O T E S T O T H E AC C O U N T S

A. Where the BBC’s income comes from continued
A4 Income from contracts with customers
The BBC has applied IFRS 15 Revenue from Contracts with Customers using the cumulative effect method and therefore the comparative
information has not been restated and continues to be reported under IAS 18 Revenue and IAS 11 Construction Contracts. The details of
accounting policies under IAS 18 and IAS 11 are disclosed separately if they are different from those under IFRS 15.
A4.1 Significant accounting policy
The BBC’s income recognition policy and main sources of income are noted under section H ‘Basis of preparation of the financial
statements and other accounting policies’ on page 248 onwards.
Content and format sales are recognised on the later of the licence period start date or when the associated programme has beendelivered. In the comparative period, this income was recognised when the associated programme was available for delivery.
Minimum guarantee revenue on right to use licences are also recognised on the later of the licence period start date or when theassociated programme has been delivered. In the comparative period, all minimum guarantees were spread over the licence period.
A4.2 Disaggregation of income
In the following table, income is disaggregated by segment, income streams and timing of income recognition. See note G10 for ageographical split of total income which differs to contract income primarily by licence fee income (see note A2).

2019

PSB
Group
£m

BBC
Studios£m

Othercommercials
£m

Group
adjustments
£m

Group
£m

43
37
32
2
–

412
492
32
23
141

–
69
–
68
46

(32)
(403)
(16)
(1)
–

423
195
48
92
187

22
51

89
–

–
–

(1)
(31)

110
20

187

1,189

183

(484)

1,075

138
49

1,048
141

147
36

(450)
(34)

883
192

A1

187

1,189

183

(484)

1,075

Note

PSB
Group
£m

BBC
Studios£m

Othercommercials
£m

Group
adjustments
£m

Group
£m

41
34
34
2
–

414
506
37
21
150

–
50
–
68
41

(31)
(388)
(4)
(1)
–

424
202
67
90
191

17
33

108
–

–
–

(1)
(26)

124
7

161

1,236

159

(451)

1,105

121
40

1,086
150

131
28

(424)
(27)

914
191

161

1,236

159

(451)

1,105

Note

Income streams
Content and format sales
Production income
Royalties
Advertising income
Subscription fees
Consumer products(including ticket sales)
Other contract income
A1, A3
Timing of transfer of goods andservices
Point in time
Over time

2018

Income streams
Content and format sales
Production income
Royalties
Advertising income
Subscription fees
Consumer products(including ticket sales)
Other contract income
A1, A3
Timing of transfer of goods andservices
Point in time
Over time
A1

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F I N A N C I A L S TAT E M E N T S

A. Where the BBC’s income comes from continued
A4 Income from contracts with customers continued
A4.3 Contract balances
Contract assets (accrued income) primarily relate to the BBC’s right to consideration for work completed but not billed at the reporting
date. Contract liabilities (deferred income) primarily relate to the consideration received from customers in advance of transferring agood or service. The following table provides analysis on significant changes to contract assets and liabilities during the year:
Contract
assets£m

Contract
liabilities£m

At 1 April 2018
Balance transferred following adoption of IFRS 15
Decrease due to balance transferred to trade receivables
Decrease due to income recognised in the period
New contract assets
Increase due to cash received in advance and not recognised as income during the year

–
3
(3)
–
4
–

–
(64)
–
50
–
(126)

At 31 March 2019

4

(140)

Presented within:
Current
Non-current

4
–

(119)
(21)

4

(140)

A4.4 Transaction price allocated to the remaining performance obligations
The following table includes income expected to be recognised in the future related to the performance obligations that are unsatisfied(or partially unsatisfied) at the reporting date.

Content and format sales
Production income
Royalties
Advertising income
Subscription fees
Consumer products (including ticket sales)
Other contract income

2020
£m

2021
£m

2022
£m

Beyond
£m

127
19
3
9
101
9
1

54
82
2
–
34
8
1

34
18
2
–
16
7
1

183
214
5
–
16
–
–

269

181

78

418

No consideration from contracts with customers is excluded from the amounts presented above.
The BBC applies the practical expedient allowable by paragraph 121 of IFRS 15 and does not disclose information about the remaining
performance obligations that have original expected durations of one year or less.
A4.5 Contract costs
There were no capitalised commission fees or any other contract costs in the current year or prior year.
Applying the practical expedient in paragraph 94 of IFRS 15 Revenue from Contracts with Customers, the BBC recognises the incremental
costs of obtaining contracts as an expense when incurred if the amortisation period of the assets that the BBC otherwise would haverecognised is one year or less.
A5 Contribution of commercial activities
A dividend of £73 million (2018: £38 million) was declared by BBC Commercial Holdings Limited to the PSB Group. In addition, a dividendof £1 million was declared by BBC Property Limited to PSB Group.
In the year ended 31 March 2019, the following dividends were declared to BBC Commercial Holdings Ltd:—

£65 million by BBC Studios (2018: £71 million);—£43 million by BBC Global News, of which £41 million was a dividend in specie (2018: nil); and—£1 million by BBC Studioworks (2018: nil).

The dividends above are not identifiable in the consolidated primary statements as they are eliminated during the consolidation process.
BBC Studios also declared a £1 million dividend to minority interest holder Sid Gentle during the year (2018: nil) which reduces the
non-controlling interest proportion of the BBC’s equity accordingly.

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211

N O T E S T O T H E AC C O U N T S

B. How the BBC spends the funds
This section analyses the total operating costs incurred by the BBC.
B1 Total operating costs
Total operating costs have been arrived at after charging the following items:

Intangible fixed assets, property, plant and equipment and other investments
Depreciation– owned assets– leased assets
Amortisation of intangible fixed assets
Impairment of investments in associates and joint ventures
Impairment of intangible assets
Inventories
Write-downs of programme-related assets recognised as an expense
Other operating costs
Payments under operating leases– land and buildings– plant and machinery– other
Net loss on disposal of tangible* and intangible fixed assets
Audit fees (see below)
Research costs1
Online and TV development
Net exchange differences on settled transactions
Impairment of trade receivables
Staff costs
*

Note

2019
£m

2018
£m

D1
D1, D2
E1
E3
E1

101
35
191
1
21

105
35
199
–
1

2

5

52
8
62
–
2
21
76
(8)
7
1,480

52
8
65
7
2
17
66
22
2
1,397

F8
C2

The loss on disposal of tangible fixed assets represents adjustments to depreciation on disposals made in the ordinary course of business.

The National Audit Office served as independent external auditor for the years ended 31 March 2019 and 31 March 2018.
The following table presents the aggregate fees for professional services and other services rendered by the external auditors to the
BBC:
2019
£m

2018
£m

For the audit of the BBC’s annual accounts
For the audit of subsidiaries of the BBC

1
1

1
1

Total audit and audit-related assurance services

2

2

Total fees paid22Non-audit services with other auditors (primarily taxation compliance services) totalled £0.2 million (2018: £0.2 million).
B2 Analysis of total operating costs by commercial activities
BBC Studios

Other commercials

Total commercials

2019
£m

2018
£m

2019
£m

2018
£m

2019
£m

2018
£m

Cost of sales
Distribution costs
Administration expenses

880
54
206

975
52
172

166
–
12

123
–
39

1,046
54
218

1,098
52
211

Total operating costs

1,140

1,199

178

162

1,318

1,361

Administration expenses include impairment costs of £21 million as detailed within note B1.

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

B. How the BBC spends the funds continued
B3 Programme-related assets and other inventories
The main output of the BBC is the production of programmes for broadcast and the sale of rights for others to broadcast. This note
discloses the amounts for those programmes that are in production, completed programmes that are ready for broadcast but not yet
aired, and rights secured to broadcast programmes produced independently of the BBC. Inventory for the BBC’s commercial activities isalso contained in this note.
2019
£m

2018
£m

Programme-related assets– Rights to broadcast acquired programmes and films– Prepayments to acquire future programme-related rights– Completed programmes– Programmes in production

99
432
67
139

95
382
52
190

Total programme-related assets
Other inventories

737
6

719
7

Total programme-related assets and other inventories

743

726

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213

N O T E S T O T H E AC C O U N T S

C. What the BBC spends on its people
The BBC employs a significant number of people. It also provides pension benefits to both current and past employees. This section isbroken into two main parts; the first details employee numbers (excluding freelancers and agency staff), costs and transactions withmembers of the BBC Executive Committee and BBC Board who served during the year. The second presents the key information relating
to the BBC Group’s pension plans.
The analysis provided in the pension notes is based on the IAS 19 Employee Benefits estimate of the scheme’s assets and liabilities as
at 31 March 2019. The most recent actuarial valuation of the pension scheme completed by Willis Towers Watson showed a funding
shortfall of £1,769 million at 1 April 2016.
Further information on the analysis of the BBC Pension Scheme assets and the assumptions underlying the liabilities are set out innote G2.
C1 Persons employed
The average number of persons employed in the year was:Average for the year
2019
Number2018*
NumberPSB Group
BBC Studios
Other commercials

19,231
2,714
456

18,2102,963
258

Group total

22,401

21,431*

Prior year results have been adjusted to exclude casual staff.

Other commercials included 165 Ad Sales staff transferred from BBC Studios on 1 April 2018. The PSB Group also included an average of
90 technology staff transferred from BBC Studios during the year.
Within the averages above, 2,907 (2018: 2,855) part-time employees have been included at their full-time equivalent of 1,840 (2018:
1,786).
In addition to the above, the BBC employed an average full-time equivalent of 1,350 (2018: 1,187) persons on a casual contract.
C2 Employee remuneration
Note

Salaries and wages
Social security costs
Pension costs
Main scheme (defined benefit)
Other schemes

*

C6.3
C6.3

2019
£m

2018*
£m

1,078
132

1,019
120

224
46

227
31

1,480

1,397

Prior year results have been adjusted to exclude casual staff.

The employer cash contributions to the defined benefit pension scheme are borne by each business.
Employee pension contributions made via salary sacrifice are included within pension costs, with a corresponding reduction in salaries
and wages.
C3 Remuneration of the BBC Board
The total emoluments of the members of the BBC Executive Committee and BBC Board are disclosed in the remuneration report.

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F I N A N C I A L S TAT E M E N T S

C. What the BBC spends on its people continued
C4 Key management personnel compensation
Key management personnel are those people who have authority and responsibility for planning, directing and controlling the activitiesof the BBC. This includes members of the BBC Executive Committee and BBC Board, including the non-executive directors (see the BBC
executive remuneration report).
Information about the BBC’s structure, senior staff salaries and expenses are published on the BBC’s website.
Key management personnel compensation is as follows:

Short-term employee benefits
Post-employment benefits

2019
£m

2018
£m

5.8
0.2

4.7
0.3

6.0

5.0

C5 Related party1 transactions with key management personnel
Charlotte Moore has a close family member who is a director of Perry Images Limited. During the year, this company provided a trivial
amount of service to the BBC. There were no outstanding balances as at 31 March 2019 relating to this company. Tanni Grey-Thompson
received £3,000 as an on-air contributor during the year.
C6 Group pension plans
The following section includes the key notes relating to BBC Group pension plans and, more specifically, the BBC Pension Scheme1.
Further supplementary notes on the assumptions underpinning the value of the BBC Pension Scheme assets and liabilities are disclosed
in note G2.
As the BBC Group has two defined benefit pension schemes, the BBC Pension Scheme and the Unfunded Scheme, the information in thissection analyses the liability and income statement charge between the two schemes (note C6). Separate analysis follows in respect of
the BBC Pension Scheme to highlight the points outlined below (note C7).
The defined benefit pension schemes give rise to liabilities which are included on the BBC Group balance sheet as the BBC bears the risks
of investment returns, life expectancies and inflation, which impact the future pension payment amounts. The net liability consists of two
component parts:—

scheme liabilities: the present value of the future pension payments the BBC is required to pay in respect of employee service
performed up to the balance sheet date; and—scheme assets: the assets held by the pension fund, into which the BBC pays annual contributions. These assets are used to fund thepayments to retired members and to generate returns to fund future pension payments.

The BBC Group’s defined contribution plans do not give rise to balance sheet pension assets/liabilities as there is no ongoing liability forthe employer from these plans once the contributions due for the year have been settled. The expenditure on the defined contribution
scheme shown in these accounts represents the BBC’s contributions during the financial year.
C6.1 Pension liabilities included in the balance sheet
The pension liabilities included in the BBC Group balance sheet comprise both the BBC Pension Scheme and the Unfunded Scheme andare analysed below:
Pension liabilities
2019
£m

2018
£m

BBC Pension Scheme
Unfunded Scheme

(522)
(8)

(510)
(8)

Total

(530)

(518)

1

See Glossary for further details

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N O T E S T O T H E AC C O U N T S

C. What the BBC spends on its people continued
C6 Group pension plans continued
C6.2 Group pension plans
BBC Pension
Scheme2019£m

Unfunded
Scheme
2019
£m

Total
2019
£m

BBC Pension
Scheme2018£mUnfunded
Scheme
2018
£m

Total
2018
£m

Deficit in scheme at the start of the year
Movement in the year:
Current service cost1
Contributions (from employer)
Past service costs1*
Administration costs incurred
Net finance cost1
Remeasurement1 gains

(510)

(8)

(518)

(1,141)(8)(1,149)

(206)
191
(18)
(7)
(10)
38

–
–
–
–
–
–

(206)
191
(18)
(7)
(10)
38

(227)
155
–
(9)
(25)
737

–
–
–
–
–
–

(227)
155
–
(9)
(25)
737

Deficit in scheme at the end of the year

(522)

(8)

(530)

(510)

(8)

(518)

*

For the period ending 31 March 2019 this is in respect of an allowance in relation to Guaranteed Minimum Pension equalisation.

The assumptions for pension scheme liabilities of the Unfunded Scheme are the same as the main scheme. As the scheme is unfunded
there are no assets.
C6.3 Pension charges in consolidated income statement
Defined benefit schemes

Note

2019
Current service cost
Past service costs
Administration costs

C2
C2

Total operating charge
Net finance cost

F11

Net cost in consolidated income statement
2018
Current service cost
Administration costs

C2

Total operating charge
Net finance cost
Net cost in consolidated income statement

F11

BBC Pension
Scheme£m

Unfunded
Scheme£m

Definedcontribution
scheme£m

All schemes
£m

(206)
(18)
(7)

–
–
–

(46)
–
–

(252)
(18)
(7)

(231)

–

(46)

(277)

(10)

–

–

(10)

(241)

–

(46)

(287)

(227)
(9)

–
–

(31)
–

(258)
(9)

(236)

–

(31)

(267)

(25)

–

–

(25)

(261)

–

(31)

(292)

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

C. What the BBC spends on its people continued
C7 BBC Pension Scheme
The BBC Pension Scheme is closed to new entrants. It provides pensionable salary-related benefits on a defined benefit basis.
The pension scheme is administered by a fund that is legally separated from the BBC Group. The Trustees of the pension fund are
required by law to act in the interest of the fund and of all relevant stakeholders of the scheme. The pension scheme Trustees manage
the plan in the short, medium and long term. They make funding decisions based on valuations which take a longer-term view of theassets required to fund the scheme’s liabilities.
The pension scheme exposes the BBC to the following actuarial risks:
Risk

Description

Investment risk

Actual returns may differ from expected returns. If the return on assets is below the discount rate, it will
create a deficit. Investments are diversified, across and within asset classes, to avoid over-exposure to
any one asset class or market.

Currency risk

Movements in exchange rates can impact the sterling value of overseas assets held. The scheme ensuresthat overseas investments are diversified across currencies and buys forward rate contracts in order topartially hedge against US dollar and euro exposures.

Counterparty risk

A counterparty may default whilst owing money to the scheme. Collateral is posted by the counterparty
for long-term transactions when the valuation of the transaction is favourable to the scheme.

Interest risk

A fall in interest rates would cause the present value of liabilities to rise. To mitigate this risk, thescheme’s Trustees invest in bonds, derivatives and other investments with predictable long-term cash
flows that will tend to rise in price if interest rates fall.

Longevity risk

Longer life expectancy would increase the scheme’s liabilities. The scheme’s Trustees regularly assess
the possibility and value of hedging the scheme’s longevity risk.

Inflation risk

An increase in expected inflation will cause the present value of liabilities to rise if it is not accompanied
by a rise in interest rates. To mitigate this risk, the scheme’s Trustees invest in index-linked bonds,
derivatives and other assets whose value is likely to increase if inflation rises.

Liquidity risk

The scheme may not have sufficient liquid assets to allow it to meet its liabilities and other obligations as
they fall due. The amount of cash held to pay benefits is assessed well in advance to minimise unforeseen
sales and transaction costs and the large majority of the scheme’s assets are invested in highly liquid
assets.

Custody risk

The collapse of the scheme’s custodian could result in a significant proportion of the scheme’s assets
being frozen or put at risk of loss. The scheme undertakes rigorous due diligence of the custodian
relationship and conducts regular service level reviews.

C7.1 Scheme financial position
Accounting valuations of the scheme are performed by Willis Towers Watson, consulting actuaries. Formal actuarial valuations areundertaken at least every three years.
IAS 19 valuation1

Note

2019
£m

2018
£m

Scheme assets
Scheme liabilities

G2.2
G2.1

17,183(17,70 5)

16,476(16,986)

Deficit

(522)

(510)

Percentage by which scheme assets cover liabilities

97%

97%

Key movements in the year are shown in notes G2.1 and G2.2.
A deferred tax asset or liability in relation to the scheme does not arise for the BBC because most of the BBC’s public service activity is
not subject to taxation.

1 See Glossary for further details

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217

N O T E S T O T H E AC C O U N T S

C. What the BBC spends on its people continued
C7 BBC Pension Scheme continued
C7.1 Scheme financial position continued
The sensitivities of the scheme’s liabilities to changes in the principal assumptions are set out below:(Increase)/decrease on
scheme liabilities
£m

2019

Assumption used

Movement

Impact on
scheme liabilities%

Discount rate
Discount rate
Retail price inflation rate
Retail price inflation rate
Mortality rate
Mortality rate

2.3%
2.3%
3.2%
3.2%
See note G2.5
See note G2.5

decrease 0.1%
increase 0.1%
decrease 0.1%
increase 0.1%
decrease 1 year
increase 1 year

2.2%
1.7%
1.7%
1.8%
4.6%
4.4%

(398)
299
304
(312)
808
(771)
(Increase)/decrease on
scheme liabilities
£m

(391)
289
309
(316)
659
(684)

2018

Assumption used

Movement

Impact on
scheme liabilities%

Discount rate
Discount rate
Retail price inflation rate
Retail price inflation rate
Mortality rate
Mortality rate

2.4%
2.4%
3.1%
3.1%
See note G2.5
See note G2.5

decrease 0.1%
increase 0.1%
decrease 0.1%
increase 0.1%
decrease 1 year
increase 1 year

2.3%
1.7%
1.8%
1.9%
3.9%
4.0%

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation due to thelikelihood of some correlation between assumptions.
In presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected
unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation
liability recognised in the statement of financial position.
C7.2 Funding the scheme
The 2016 actuarial valuation by Willis Towers Watson of the pension scheme showed a funding shortfall of £1,769 million. Consequently,
a recovery plan was agreed between the BBC and the pension scheme Trustees which details the contribution amounts to be paid by the
BBC over an 11-year period starting in 2017. Future contributions are to be paid to the pension scheme on or before the due dates shown
below.
Amount£m

Due date

31 March 2020
31 March 2021
31 March 2022
31 March 2023
31 March 2024

145
195
180
185
195

Amount£m

Due date

31 March 2025
31 March 2026
31 March 2027
31 March 2028
31 December 2028

195
195
195
195
195

The next formal actuarial valuation is to be performed as at 1 April 2019.
Projection
Contribution rates

2020
%

2019
%

2018
%

Employer
Employee (Old and New Benefits)
Employee (Career Average Benefits 2006)
Employee (Career Average Benefits 2011)

31.4
7.5
4.0
6.0

31.4
7.5
4.0
6.0

16.7
7.5
4.0
6.0

The member contributions to the scheme are mainly paid via a salary sacrifice arrangement. These have been treated as employer
contributions.
On the basis of the pension assumptions above, contributions totalling £160 million are expected to be paid in 2019/20.

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F I N A N C I A L S TAT E M E N T S

C. What the BBC spends on its people continued
C7 BBC Pension Scheme continued
C7.3 Scheme cash flows (day-to-day liquidity)
Below are the cash flows related to the BBC Pension Scheme (not included in the Group results). As the scheme is closed to new entrants,
the level of contribution from employees will decrease (as members retire, there are no new entrants to replace the reduction in
employee contributions).
2019
£m

2018
£m

Contributions including additional voluntary (employer and employee)
Investment income

194
292

157
253

Cash inflows
Payments of pensions and transfers out
Expenses

486
(511)
(29)

410
(509)
(9)

Net cash outflow

(54)

(108)

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219

N O T E S T O T H E AC C O U N T S

D. The property, technology and equipment used by the BBC to make and distribute its programmes
The BBC uses a significant number of assets in its operations. This section sets out those assets the BBC intends to continue to use,those to be disposed of and any disposals made during the year.
D1 Property, plant and equipment
Land andbuildings*£mPlant andmachinery£m

Furniture andfittings£m

Assets underconstruction
£m

Total
£m

Cost
At 1 April 2017
Additions
Transfer to intangible assets
Brought into service
Disposals
Exchange movements

1,005
–
–
25
(9)
(1)

1,075
9
–
89
(51)
–

130
1
–
9
(6)
(1)

132
121
(27)
(123)
–
–

2,342
131
(27)
–
(66)
(2)

At 31 March 2018
Additions
Transfer to intangible assets
Brought into service
Disposals

1,020
–
–
30
(6)

1,122
6
–
62
(66)

133
–
–
10
(1)

103
124
(8)
(102)
–

2,378
130
(8)
–
(73)

At 31 March 2019

1,044

1,124

142

117

2,427

Depreciation
At 1 April 2017
Charge for the year
Disposals

372
41
(7)

798
86
(46)

93
9
(6)

–
–
–

1,263
136
(59)

At 31 March 2018
Charge for the year
Disposals

406
47
(6)

838
76
(66)

96
9
(1)

–
–
–

1,340
132
(73)

At 31 March 2019

447

848

104

–

1,399

Net book value
At 31 March 2019

597

276

38

117

1,028

At 31 March 2018

614

284

37

103

1,038

Land andbuildings*£mPlant andmachinery£m

Furniture andfittings£m

Assets underconstruction
£m

Total
£m

At 31 March 2019

442

3

–

–

445

At 31 March 2018

471

5

–

–

476

2019
£m

2018
£m

At 1 April and 31 March

131

131

Depreciation
At 1 April
Charge for the year

57
4

53
4

At 31 March

61

57

Net book value (held under finance lease)70

74

Included above are assets held under finance leases at net book value of:*Land and buildings are not separable and therefore reported collectively.

D2 Investment properties

Cost

At 31 March 2019, the BBC held investment properties valued at £176 million (2018: £175 million). The valuation of these investment
properties was carried out by independent valuers Lambert Smith Hampton, in accordance with the Royal Institution of Chartered
Surveyors (RICS) Valuation Professional Standards. In estimating the fair value1 of the properties, the highest and best use of theproperties is their current use.
The property rental income earned by the BBC from its investment properties, which are leased out under operating leases, amounted to£20 million (2018: £19 million). Direct operating expenses incurred on the investment properties, which generated rental income during
the year, amounted to £20 million (2018: £17 million). There were no direct operating expenses incurred on the investment properties
which did not generate rental income during the year (2018: nil).
1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

E. Investments in the BBC’s commercial activities
This section is primarily driven by the commercial activities of the BBC and includes information on assets used to generate economic
benefits for the BBC. Also included are intangible assets such as goodwill and programme rights, balances held to represent the BBC’sinterest in associates and joint ventures and the results of any sale of operations that have occurred.
E1 Intangible assets
Goodwill£m

Programmerights1£m

Software£m

Other
intangibles
£m

Total
£m

Cost
At 1 April 2017
Additions
Disposals
Transfer from property, plant and equipment
Exchange movements

36
2
–
–
(1)

871
151
–
–
(2)

216
5
(68)
27
–

15
10
–
–
(1)

1,138
168
(68)
27
(4)

At 31 March 2018
Additions
Disposals
Transfer from property, plant and equipment
Exchange movements

37
19
–
–
–

1,020
169
(5)
–
2

180
22
(5)
8
–

24
9
–
–
–

1,261
219
(10)
8
2

At 31 March 2019

56

1,186

205

33

1,480

Amortisation and impairment
At 1 April 2017
Charge for the year
Disposals
Impairment
Exchange adjustments

–
–
–
1
–

743
169
–
–
(2)

149
26
(68)
–
–

7
4
–
–
(1)

899
199
(68)
1
(3)

At 31 March 2018
Charge for the year
Disposals
Impairment
Exchange adjustments

1
–
–
21
–

910
152
(5)
–
2

107
29
(4)
–
–

10
10
–
–
–

1,028
191
(9)
21
2

At 31 March 2019

22

1,059

132

20

1,233

Net book value
At 31 March 2019

34

127

73

13

247

At 31 March 2018

36

110

73

14

233

2019
£m

2018
£m

4
21
9

25
2
9

34

36

E2 Goodwill1
All goodwill is recognised in BBC Studios and allocated by cash-generating unit1 (CGU) as follows:

Consumer distribution
Independent production company
Other

The Group tests goodwill for impairment in the accounting period in which a business combination takes place; thereafter annually, or
more frequently if there are indications that goodwill might be impaired.
The recoverable amounts of the CGUs are determined from value in use calculations. The key assumptions used for these calculations arethose regarding discount rates and growth rates. Management estimates discount rates using pre-tax rates that reflect current market
assessments of the time value of money and the risks specific to each CGU.

1 See Glossary for further details

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221

N O T E S T O T H E AC C O U N T S

E. Investments in the BBC’s commercial activities continued
E2 Goodwill1 continued
Consumer distribution business
The goodwill in this CGU arose as a result of the acquisition of 2 Entertain Limited on 6 August 2009. The cash flow projections used indetermining value in use are based on the current business plan approved by management, which covers a five-year period, after whichcash flows have been extrapolated using an expected long-term growth rate of -34% (2018: -4%).
A discount rate of 8.8% (2018: 9.3%) has been applied to the cash flows.
The main assumption on which the forecast cash flows are based is the trends in the global DVD market. The Group performed an
operational review of the DVD business, concluding that sales are declining by an average of approximately 22% per year, which theGroup extrapolated to calculate the expected decline on EBITDA for this business.
As a result of the changes in the global DVD market, management made the decision to impair the Goodwill in the consumer distribution
business by £21 million in 2018/19 as a result of the annual impairment review.
Independent production company
The 2018 goodwill balance arose as a result of the acquisition of Sid Gentle Films Limited on 25 January 2018. In 2019 additional
goodwill arose on step-acquisition of Lookout Point Limited on 5 July 2018.
The cash flow projections used in determining value in use for both CGUs are based on the current business plans approved bymanagement, which cover a five-year period, after which cash flows have been extrapolated using an expected long-term growthrate of 1%.
A discount rate of 10.4% has been applied to the cash flows.
Management believes that no reasonable change in the key assumptions on which the value in use of these CGUs are based would resultin an impairment.
E3 Interests in associates1 and joint ventures1
This note details the BBC’s share of net assets in associates and joint ventures, along with the impact that they have on the income
statement. Details of significant associates and joint ventures along with principal subsidiary undertakings, including their activities,
are provided in note G6.
2019
£m

2018
£m

Interests in associates
Interests in joint ventures

199
58

192
48

Total interests in associates and joint ventures

257

240

Share of results of associates
Share of results of joint ventures

11
25

12
24

Total share of results of associates and joint ventures

36

36

The movements in associates and joint ventures during the year were as follows:
Associates
2019£mJoint ventures
2019
£m

Total
2019
£m

Associates
2018£mJoint ventures
2018
£m

Total
2018
£m

At 1 April
Additions
Disposals
Share of results
Adjustment to provision for unrealised
profits
Dividends receivable
Foreign exchange translation gains/(losses)
Impairment

192
3
(6)
11

48
1
–
25

240
4
(6)
36

205
6
(2)
12

53
1
–
24

258
7
(2)
36

1
(12)

(1)
(15)

–
(27)

(1)
(9)

1
(30)

–
(39)

11
(1)

–
–

11
(1)

(19)
–

(1)
–

(20)
–

At 31 March

199

58

257

192

48

240

Additions relate predominantly to investments in independent production companies.

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

E. Investments in the BBC’s commercial activities continued
E3 Interests in associates1 and joint ventures1 continued
The following table presents the Group’s share of material associates during the year:
New Video
Channel America
LLC
2019
£m

YouView
Limited2019£m

New Video
Channel America
LLC
2018
£m

YouView
Limited2018£mNon-current assets
Current assets
Current liabilities
Non-current liabilities

272
105
(156)
(6)

–
5
(6)
(62)

145
90
(28)
(8)

–
5
(8)
(45)

Net assets/(liabilities)

215

(63)

199

(48)

Group’s share of net assets
Provision for unrealised profit
Goodwill

108
(5)
66

–
–
–

100
(5)
62

–
–
–

Group’s share of net assets of material associates

169

–

157

–

Income

145

10

130

12

Profit/(loss) after tax
Share attributable to other parties

24
(12)

(14)
14

24
(12)

(31)
31

Share of results of material associates

12

–

12

–

Daunus Limited
2019£m

UKTV Media
Limited2019£mDaunus Limited
2018£m

UKTV Media
Limited2018£mNon-current assets
Current assets
Current liabilities
Non-current liabilities

555
61
(58)
(691)

18
248
(124)
(48)

558
60
(53)
(703)

9
241
(129)
(51)

Net (liabilities)/assets

(133)

94

(138)

70

Group’s share of net assets
Provision for unrealised profit

–
–

47
–

–
–

35
(4)

Group’s share of net assets of material joint ventures

–

47

–

31

The following table presents the Group’s share of material joint ventures during the year:

Income

17

332

15

328

(Loss)/profit after tax
Share attributable to other parties

(3)
3

53
(27)

5
(5)

54
(27)

Share of results of material joint ventures

–

26

–

27

Daunus Limited prepares its financial statements to a 30 November accounting reference date and under Financial Reporting Standard
102. Adjustments are therefore made to align these to the Group. The Group is unable to receive dividends from Daunus Limited until
2033 due to restrictions mandated within this entity.

1 See Glossary for further details

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N O T E S T O T H E AC C O U N T S

F. Managing funding (including future costs)
This section contains the notes to the balance sheet that detail the funding of the BBC as well as the assets and liabilities that areprimarily used in the day-to-day transactions of the BBC.
The BBC collects licence fees from UK households on behalf of the Consolidated Fund. This is passed up to the Fund as reflected in the
BBC’s Television Licence Fee Trust Statement1. Licence fee income, whilst derived from the amount collected directly from licence fee
payers, therefore represents a grant-in-aid from DCMS within the Group financial statements.
This section sets out the external borrowings of the BBC and the related disclosures required by the DCMS. The BBC is subject to two
specific limits to its borrowings:—

the Public Service net borrowing limit of £1,050 million is set by the Secretary of State for the DCMS in accordance with the
Framework Agreement between the BBC and DCMS. Of this limit, £850 million is specifically for finance leases; and—under a direction granted by the Secretary of State for the DCMS a net borrowing limit of £350 million has been set for the BBCcommercial group.

The borrowing limits have been adjusted in the interim for the impact of adopting IFRS 16 Leases from 1 April 2019 to 31 March 2020. A
net borrowing limit of £2,200 million, of which £2,000 million is specifically for leases, will apply to Public Service and a borrowing limit of£500 million, of which £150 million is specifically for leases, will apply to the BBC commercial group for the duration of 2019/20. A
permanent adjustment will be in place from 1 April 2020.
F1 Cash and cash equivalents
2019
£m

2018
£m

Cash at bank, available on demand
Short-term deposits

118
350

119
404

Total

468

523

Exchange£m

At 31 March2019£m

F2 Analysis of net debt for DCMS borrowing limits
At 1 April
2018£mCash flows£m

Non-cashchanges£m

Total cash and cash equivalents

523

(55)

–

–

468

Loans and loan notes
Derivatives associated with borrowings
Finance leases

(182)
8
(675)

(9)
–
–

–
13
24

(12)
–
–

(203)
21
(651)

Net debt

(326)

(365)

Made up of:
PSB Group
Centre House Productions
BBC Studios
Other commercial businesses

(239)
1
39
(127)

(382)
–
40
(23)

Net debt

(326)

(365)

F3 Reconciliation of net funds/(debt) to the DCMS borrowing limits
Public Services1
Net funds
excluding financeleases£m

Finance leaseborrowings£m

Net debt£m

BBC commercialgroup*£m

2019
Net funds/(debt)
Net borrowing limit

269
(200)

(651)
(850)

(382)
(1,050)17(350)

Headroom

469

199

668

367

2018
Net funds/(debt)
Net borrowing limit

435
(200)

(674)
(850)

(239)
(1,050)

(88)
(350)

Headroom

635

176

811

262

*

Under the terms of the DCMS agreement, the BBC Commercial Holdings Group must satisfy two financial covenants, which need to be satisfied throughout the respective
period. During 2018/19 and 2017/18, the BBC Commercial Holdings Group was in compliance with both of these covenants.

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

F. Managing funding (including future costs) continued
F4 Borrowings
F4.1 Borrowings due within one year

Bank loan
Obligations under finance leases

2019
£m

2018
£m

9
21

1
18

30

19

2019
£m

2018
£m

194
630

181
657

824

838

2019
£m

2018
£m

21
118
512

18
112
545

651

675

F4.2 Borrowings due after more than one year

Bank loan
Obligations under finance leases

Analysis of the BBC’s borrowing facilities is set out in note F5.
F4.3 Obligations under finance leases1
The aging of obligations under finance leases is as follows:

Within one year
Between one and five years
Over five years

Under the terms of the lease agreements, the BBC has the right to share in the residual value of one of its key finance lease properties,
Pacific Quay. This share will be passed to the BBC as either a cash flow at the end of the lease arrangement, or a reduction in rentals if
the lease agreement is extended for a further term. In addition, the BBC has the right to repurchase each property at the end of therespective lease agreements.
Interest rates are fixed at the contract date. Leases with a carrying value of £649 million (2018: £669 million) have contingent elements
included within their contracts and result in contingent rents of £32 million (2018: £29 million) being included in operating costs.
F4.4 Operating leases1
The total future minimum lease payments under non-cancellable operating leases are payable as follows:

Within one year
Between one and five years
Over five years

*

2019
£m

2018*
£m

79
197
334

73
211
337

610

621

In advance of the adoption of IFRS 16 Leases on 1 April 2019 the BBC has undertaken an exercise to reassess its operating lease commitments and the contracts included within.
The results of this exercise are reflected in the updated disclosure.

The BBC’s operating lease agreements primarily relate to land, office space, computers and other IT equipment. Certain contracts
include renewal options, stepped rents or annual RPI uplifts (which are accounted for on a straight-line basis) or periodic rent reviews.
All leases have been entered into on commercial terms.
The BBC has entered into a number of property sublease arrangements. The total future minimum sublease income expected to bereceived under non-cancellable subleases at 31 March is:Within one year
Between one and five years
Over five years

2019
£m

2018
£m

23
108
240

26
94
245

371

365

1 See Glossary for further details

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N O T E S T O T H E AC C O U N T S

F. Managing funding (including future costs) continued
F5 Borrowing facilities
Total available
31 March2019£mDrawn down at
31 March2019£mTotal available
31 March
2018£mDrawn down at
31 March
2018£mExpiry orreview date

LIBOR* plus 0.3% rising to
LIBOR* plus 0.15% on
utilisations over 1/3 and
LIBOR* plus 0.45% on
utilisations over 2/3

200

–

200

–

July 2020

Uncommitted money
market lines (short-termborrowings)

The interest rate on
uncommitted money market
lines are determined when
traded with the bank

25

–

25

–

Reviewed
annually

GBP overdraft

Bank base rate plus 1.5%

5

–

5

–

Reviewed
annually

Multicurrency overdraft

Banks’ short-term offered
rates for the relevant
currency plus 1%

5

–

5

–

Reviewed
annually

Overdraft*

Bank base rate plus 1%.
Excess usage at bank baserate plus 2%

1

–

1

–

Reviewed
annually

210

–

210

–

March 2024

20

–

20

–

Reviewed
annually

Facility

Interest rate

PSB Group
Sterling revolving credit
facility agreement

BBC Commercial Holdings Limited
Multicurrency, revolving
LIBOR* plus 0.45% rising tocredit facility agreement
LIBOR* plus 0.15% on
for loans and letters ofutilisations over 1/3 andcreditLIBOR* plus 0.15% on
utilisations over 2/3
Overdraft or money market Money market line – marginlines
of 1.0% (2018: 1.0%)
US Private Placement

Fixed interest at 2.36%

28

28

28

28

June 2020

US Private Placement**

Fixed interest at 2.71%

165

165

153

153

June 2020

2

–

2

–

Reviewed
annually

BBC Studios Distribution Limited
Overdraft*
Bank base rate plus 1% if
drawn down in sterling.
Bank currency overdraft
rate plus a 1% margin if
drawn down in othercurrencies
Bank loan

Three-month GBP LIBOR
plus 1.75%

9

1

–

–

November
2021

Bank loan

Three-month GBP LIBOR
plus 1%

3

3

9

1

August 2019

Bank loan

Three-month GBP LIBOR
plus 1%

6

6–– October 2019

* The base rate used varies according to the currency drawn. GBP drawings are linked to LIBOR.
** The US$216 million US placement is hedged to a sterling value of £143 million, valued at the time of the facility being put in place.

There have been no defaults or breaches of covenants on these facilities during the year (2018: none).

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F I N A N C I A L S TAT E M E N T S

F. Managing funding (including future costs) continued
F6 Cash generated from operations
2019
£m

2018
£m

(74)
349
41
(13)
24
–
–
(7)
(29)
(15)
(36)
(10)
74
(17)
(94)
23
39

179
340
81
19
6
7
(4)
–
–
–
(36)
(26)
80
(113)
81
(22)
(9)

255

583

2019
£m

2018
£m

Trade receivables
Other receivables
Prepayments
Amounts owed by associates and joint ventures

30
4
2
2

44
16
2
2

Total

38

64

2019
£m

2018
£m

Trade receivables
Licence fee receivables
Amounts owed by associates and joint ventures
VAT recoverable
Prepayments
Accrued income
Other receivables

235
401
45
57
142
163
88

237
405
32
31
80
132
58

Total

1,131

975

Note

Group (deficit)/surplus before taxation
Depreciation, amortisation and impairment
Difference between pension charge and cash contribution
Fair value impact of derivatives associated with loans
Fair value impact of other derivatives
Loss on disposal of tangible and intangible fixed assets
Gain on disposal of investments
Gain on deemed disposal of associate
Gain on sale and termination of operations
Other gains and losses
Share of results of associates and joint ventures
Financing income (excluding fair value swaps)
Financing costs (excluding fair value swaps)
Increase in programme-related assets and inventories(Increase)/decrease in receivables and contract assets
Increase/(decrease) in payables and contract liabilities
Increase/(decrease) in provisions

B1

G4
E3

B3

F10

Cash generated from operations
F7 Trade and other receivables
This note discloses the balances that are owed to the BBC by third parties and prepayments made by the BBC.
F7.1 Other receivables due after more than one year

F7.2 Trade and other receivables due within one year

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F. Managing funding (including future costs) continued
F8 Expected credit losses
Included in the BBC’s contract assets (see note A4.3) and trade and other receivables at 31 March 2019 are balances of £37 million (2018:£51 million) which are past due at the reporting date but not impaired. The aged analysis of these balances is as follows:

Up to three months
Three to six months
Over six months

2019
£m

2018
£m

28
3
6

35
5
11

37

51

In determining the recoverability (likelihood of receiving payment) of a contract asset or trade and other receivable the BBC considers
any change in the credit quality of the receivable from the date credit was initially granted up to the reporting date as well as future
considerations around the current state of the UK and overseas economies and any industry specific issues. Receivables are provided forbased on the probability of expected credit losses for each receivable.
Amounts charged to the impairment provision are written off when there is no expectation of recovery. Subsequent recoveries ofamounts previously written off are credited to the income statement. The impairment provision stands at £10 million at 31 March 2019(2018: £5 million).
Movements in the BBC’s provision for impairment of trade receivables and contract assets (see note A4.3) can be shown as follows:
2019
£m

2018
£m

Balance at the beginning of the year
Charge for the year
Amounts written off as unrecoverable
Amounts recovered during the year

5
7
(1)
(1)

8
2
(2)
(3)

Balance at the end of the year

10

5

2019
£m

2018
£m

Accruals and deferred income
Rights creditors
Other payables

–
16
27

6
39
34

Total

43

79

2019
£m

2018
£m

159
135
93
43
19
213
18
245
32
57

163
156
89
44
9
218
68
238
26
43

1,014

1,054

F9 Trade and other payables
This note details the amounts payable to third parties by the BBC.
F9.1 Trade and other payables due after more than one year

F9.2 Trade and other payables due within one year

Trade payables
Rights creditors
Salary and wages payables
Licence savings stamp deposits and savings cards
Amounts owed to associates and joint ventures
Accruals
Deferred income
Licence fee payable
Other taxation and social security
Other payables
Total

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F I N A N C I A L S TAT E M E N T S

F. Managing funding (including future costs) continued
F10 Provisions and contingent liabilities
At 1 April
2018£m

Charge forthe year£m

Utilised during
the year£m

Released during
the year£m

At 31 March2019£mProperty
Taxation, litigation and insurance
Restructuring
Other

42
19
17
26

10
31
35
24

–
(6)
(21)
(20)

(3)
(4)
(6)
(1)

49
40
25
29

Total

104

100

(47)

(14)

143

Included in current liabilities
Included in non-current liabilities

56
48

83
60

Total

104

143

Property
The BBC has obligations to restore leased properties to their original condition at the end of the lease term. Property provisions are
made for the cost of such restoration works as determined by the properties’ discounted net present value or the market value of thegross square footage.
Taxation, litigation and insurance
Taxation, litigation and insurance provisions relate to ongoing legal, insurance and compensation claims against the BBC. The BBC makes
specific provision for its best estimate of any damages and costs which may be awarded. A provision is only made to the extent that the
BBC considers it probable that there will be an outflow of economic benefits and the amount can be reliably estimated. There are anumber of provisions within this balance, including balances corrected to Personal Service Company’s payments that may be required.
In 2017, the Government introduced new legislation relating to the tax accountability for payments to intermediaries in the public sector.
HMRC introduced a new analysis tool for employment status (the Check Employment Status for Tax – the CEST) and other written
guidance which continues to be revised and updated in relation to its application to the production and broadcast industry. Thesechanges have led to a number of new questions and issues arising in relation to the assessment of tax status across the industry, as the
new guidance indicates that a larger proportion of on-air presenters should be treated as employed for tax purposes than previously.
HMRC has raised a number of questions with the BBC over its treatment of on-air talent engagements for tax purposes. Concurrently, anumber of on-air presenters, across the industry, are facing investigations from HMRC about how tax and NI has been applied in the past
to their engagements via a Personal Service Company.
The BBC’s discussions with HMRC and presenters on these matters continues. Conversations to date have enabled the BBC to calculate
an estimated liability which is included within the taxation, litigation and insurance provision. The provision is calculated by looking at allindividuals affected and then applying some overarching assumptions, based on conversations with HMRC and recent legal rulings. The
aim is still to settle the historic issues, at an acceptable cost to the licence fee, which resolves most of the retrospective claims that
HMRC may have against the presenters in respect of any misclassification of their employment status. This avoids the lengthy and costly
alternative of mediation between presenters and the BBC in resolving the historic misclassification issue. The BBC has approached HMRC
with a view to reaching a settlement of:1

the PAYE and NIC due where individuals were directly engaged as sole-traders (with set-off for tax and NIC they have already paid).
This is the BBC’s liability in any event; and2

the PAYE and NIC due under IR35 where individuals have been paid via intermediaries (with set-off for corporate tax and dividendstax). £12 million has been provided for settling the historic tax issues in relation to intermediaries.

In assessing whether a settlement with HMRC would represent an appropriate way to address the employment status issues facing the
BBC and its presenters, three key considerations were taken into account:1

the nature and extent of any liability attributable to the BBC from the misclassification of employment status;2

the significant impact these issues are having on the BBC and its presenters; and3whether or not a settlement with HMRC would represent a more efficient and cost-effective approach than the mediation processthat was previously being considered as a mechanism for addressing these issues and/or continued involvement in tax tribunal cases.

Restructuring
Restructuring provisions are determined by the probable costs relating to reorganisations, relocations and redundancies in the BBC. The
restructuring balance at 31 March 2019 predominantly relates to the redundancies generated through ongoing savings strategies.
Other
Other provisions include amounts relating to employment matters and other items arising across the BBC in the normal course ofbusiness, none of which are individually material.
Contingent liabilities
There were no contingent liabilities in the current year.

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N O T E S T O T H E AC C O U N T S

F. Managing funding (including future costs) continued
F11 Net financing costs
Set out below is an analysis of the financing income and expenses incurred in the year. These amounts include interest relating to financelease liabilities (see note F4.3) and defined benefit pension schemes (see note C7).
Note

Financing income
Interest income
Unwinding of discounted receivables
Exchange gain on borrowings
Fair value gains on swaps classified as fair value through surplus/deficit
Financing costs
Interest expense
Unwinding of discounted payables
Exchange loss on borrowings
Change in fair value of instruments classified as fair value through surplus/deficit
Interest on obligations under finance leases
Interest cost on pension plan liabilities1
Net financing costs

C6.3

2019
£m

2018
£m

9
1
–
13

6
–
20
–

23

26

(4)
(2)
(12)
(14)
(46)

(8)
–
–
(41)
(47)

(78)
(10)

(96)
(25)

(88)

(121)

(65)

(95)

F12 Long-term commitments not reflected in the balance sheet – contracts placed for future expenditureThis note shows amounts to which the BBC is contractually committed, but which do not meet the criteria for inclusion in the balance
sheet. It includes fixed (but not variable) payments due under outsourcing contracts for the life of those contracts.
Functions covered by these long-term outsourcing contracts include IT support, content distribution and transmission, facilities
management and elements of finance support.

Fixed asset additions
Programme acquisitions and sports rights
Independent programmes
Other fixed payments on long-term outsourcing arrangements

2019
£m

2018
£m

41
1,225
314
1,981

40
1,370
150
2,345

3,561

3,905

2019
£m

2018
£m

949
1,827
785

875
2,101
929

3,561

3,905

Long-term commitments not reflected in the balance sheet are payable as follows:

Within one year
Between one and five years
Over five years

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

G. Other
G1 Taxation
G1.1 Recognised in the income statement
The charge for the year, based on the rate of corporation tax of 19% (2018: 19%) comprised:
2019
£m

2018
£m

Current tax
UK corporation tax
Foreign tax
Adjustments in respect of prior years

(21)
20
(3)

(13)
27
(1)

Total current tax

(4)

13

Deferred tax1
Origination and reversal of temporary differences
Changes in tax rate
Adjustments in respect of prior years

(1)
–
–

(5)
(8)
(1)

Total deferred tax

(1)

(14)

(5)

(1)

Note

Total taxation credit in the consolidated income statement

G1.2

G1.2 Reconciliation of taxation expense
The PSB Group is liable to taxation on activities yielding a taxable profit including rent, royalties and interest receivable; it does nottherefore receive relief for all its expenditure. The commercial subsidiaries in the BBC Group are taxed in accordance with tax legislation.
As the BBC Group’s public sector ‘free-to-air’ broadcasting activities are not subject to taxation, the tax charge is primarily driven by the
results of the commercial businesses. The items affecting the standard rate of corporation tax are explained below:
Note(Deficit)/surplus before tax(Deficit)/surplus before tax multiplied by standard rate of corporation tax in the UK of
19% (2018: 19%)
Effects of:
Public service activities
Public service taxable external income
Non-taxable public service activities
Commercial activities
Disallowed expenditure (including goodwill impairment)
Losses utilised forward
High-end television tax relief
Tax-exempt capital loss
Tax differential on overseas earnings
Tax differential in associates and joint ventures
Changes in the tax rate
Adjustments in respect of prior years
Total tax credit for the year

G1.1

2019
£m

2018
£m

(74)

179

(14)

34

8
45

6
(13)

3
(3)
(39)
–
3
(5)
–
(3)

3
(5)
(21)
(1)
16
(10)
(8)
(2)

(5)

(1)

G1.3 Factors that may affect future tax charges
The Finance Bill 2016 was enacted on 6 September 2016. This reduced the corporation tax rate to 17% from April 2020. As this rate
reduction has been substantively enacted at the balance sheet date, the deferred tax assets have been calculated at 17% in line withwhen the company anticipates temporary differences to unwind.
As part of the 2016 Budget, the Chancellor announced the Business Tax Road Map, which included measures to limit the utilisation ofbrought forward losses and interest deductions. These were included in Finance (No. 2) Act 2017, which was substantially enacted on
31 October 2017, and applies from 1 April 2017.
There are many future changes to worldwide taxation systems as a result of the potential adoption by the UK and individual territories ofmeasures relating to the OECD Base Erosion and Profit Shifting Actions. The Group continues to actively monitor developments andevaluate their potential impact. The BBC does not expect the future tax rate to be materially impacted by these changes to theinternational tax landscape.

1 See Glossary for further details

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N O T E S T O T H E AC C O U N T S

G. Other continued
G1 Taxation continued
G1.4 Current tax assets
The current tax assets totalling £29 million (2018: £36 million) includes £30 million (2018: £28 million) due in respect of film tax credits
outstanding on high-end drama and comedy productions.
G1.5 Deferred tax assets/(liabilities)
Fixed asset
temporarydifferences£m

Provisions£mFinancial
instruments£m

Associates andjoint ventures£m

Programmerights
£m

Other
£m

Net deferred tax(liability)/asset£m

At 1 April 2018
Net (charge)/credit to
the income statement
Exchange differences

7

5

(5)

(21)

(7)

13

(8)

(2)
–

2
(1)

(1)
–

–
–

–
–

2
–

1
(1)

At 31 March 2019

5

6

(6)

(21)

(7)

15

(8)

Deferred tax asset/(liability) presented within:

2019
£m

2018
£m

Non-current assets
Non-current liabilities

8
(16)

6
(14)

(8)

(8)

The BBC has unrecognised deferred tax assets arising on capital losses totalling £139 million (2018: £139 million) and trade losses
totalling £23 million (2018: £28 million). These assets have not been recognised on the basis that there is insufficient certainty that future
gains or profits will arise against which the BBC can utilise these losses.
The BBC also has unrecognised deferred tax assets arising on excess management expenses totalling £4 million and non-trade loan
relationship losses totalling £14 million. These assets have not been recognised on the basis that there is insufficient certainty that future
gains or profits will arise against which the BBC can utilise these losses.
There is no time limit for the utilisation of either of these losses.
G2 Pension plans
This note sets out the additional detailed disclosures related to the BBC Pension Scheme which were not included in note C6 or C7.
G2.1 Changes in the present value of plan liabilities1
The table below illustrates the movement on the scheme liabilities during the year. The key items which affect this are the additional yearof pension benefits earned, any gains or losses relating to participants leaving the pension scheme, changes in assumptions made andbenefits paid out during the year.
2019
£m

2018
£m

Opening present value of plan liabilities
Current service cost
Past service cost
Administration cost
Interest on pension plan liabilities
Remeasurement (gains)/losses:– Experience adjustments– Changes in financial assumptions1
Contributions by plan participants
Benefits paid and expenses

16,986
206
18
7
401

16,886
227
–
9
407

(64)
663
1
(513)

111
(151)
1
(504)

Closing present value of plan liabilities

17,705

16,986

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

G. Other continued
G2 Pension plans continued
G2.2 Changes in the fair value of plan assets
The table below illustrates the movement on the plan assets during the year. The key items which affect this are the additional year ofcontributions made, changes in the value of the pension plan assets (including the investment return) and benefits paid during the year.
The employee contributions to the scheme by members are mainly paid through a salary sacrifice arrangement. These have been treatedas employer contributions.
2019
£m

2018
£m

Opening fair value of plan assets
Interest income on assets
Remeasurements on plan assets1
Contributions by employer
Contributions by plan participants
Benefits paid and expenses

16,476
391
637
191
1
(513)

15,745
382
697
155
1
(504)

Closing fair value of plan assets

17,183

16,476G2.3 Plan assets
The allocation of assets by the pension fund Trustees is governed by the need to manage risk against the desire for high returns and any
liquidity needs. A high percentage of assets are held in equities which the Trustees expect will produce higher returns in the long term.
2019

2018

£m

%

£m

%

1,284
1,242
(2,004)
3,106
7,303
47

7
7
(12)
18
44
–

1,260
1,259
(1,570)
3,073
6,501
97

8
8
(10)
19
39
1

1,013
540
4,434
218

6
3
26
1

944
492
4,101
319

5
3
25
2

Total assets

17,183100

16,476

100

Actual return on pension plan assets**

1,028Type of asset

Held at quoted market prices:
Equities
Pooled vehicles
Repurchase agreements
Fixed interest bonds
Index-linked bonds
Derivatives
Other assets:
Property– UK– Pooled investment vehicles
Alternatives*
Cash and other current assets

1,049

*

Alternatives are investments in asset classes other than the traditional quoted equities, bonds, property and cash. They include investments in private equity, private credit,
hedge funds, infrastructure and renewable energy investments. They are generally illiquid investments as some may require sufficient time to find buyers willing to pay fullmarket value. They are useful for managing risk as they enhance portfolio diversification and potentially reduce risk as their cash flows can be well suited to meeting thescheme’s liabilities.
** This constitutes realised gains from the receipt of investment income (e.g. dividends and rent), transactions where assets are sold and unrealised fair value changes.

The pension fund Trustees and the BBC have agreed to a long-term plan of achieving full funding on a discount rate equal to the yield on
liability-matching gilts plus 0.5% p.a. The Trustees have also established a framework for setting the scheme’s strategic asset allocation
based on the Scheme’s funding ratio, with the intention of not taking more risk than is necessary to return to full funding over the horizonof the plan.

1 See Glossary for further details

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N O T E S T O T H E AC C O U N T S

G. Other continued
G2 Pension plans continued
G2.4 BBC Pension Scheme gains/(losses) in the consolidated statement of comprehensive (loss)/income

Return on plan assets (excluding amounts included within interest)
Remeasurement gains/(losses)1 arising from:– Experience adjustments– Changes in financial assumptions
Net gain recognised in the consolidated statement of comprehensive (loss)/income

2019
£m

2018
£m

637

697

64
(663)

(111)
151

38

737

G2.5 Principal actuarial assumptions
The calculation of the scheme liabilities requires a number of financial and demographic assumptions to be made. The principal
assumptions used by the actuaries at the balance sheet date were:Principal financial assumptions

Rate of increase in salaries
Rate of increase in pension payments:
Old Benefits*
New Benefits*
Career Average Benefits (2006)*
Career Average Benefits (2011)*
Inflation assumption (RPI)
Inflation assumption (CPI)
Discount rate1
*

2019
%

2018
%

1.0

1.0

3.2
3.0
2.4
2.1
3.2
2.2
2.3

3.1
2.9
2.4
2.0
3.1
2.1
2.4

2019
Number of years

2018
Number of years

27
30

27
29

29
31

29
31

For more information on the different pension arrangements, please refer to the remuneration report.

The average life expectancy assumptions for members, after retiring at 60 years of age, are as follows:
Principal demographic assumptions

Retiring today:
Male
FemaleRetiring in 20 years:
Male
FemaleThe mortality assumptions have been selected to reflect the characteristics and experience of the membership of the scheme. These arebased on the assumptions used for the actuarial valuation which was carried out for funding purposes as at 1 April 2016. The standard‘S2’ series of tables, published by the CMI, reflect recent research into mortality experience in the UK. A subset of these tables has beenused for males and females, with a multiplier of 118% for males and 96% for females. For the allowance for future improvements, theCMI 2016 core projection has been adopted with a long-term trend of 1.25% for both males and females.
G2.6 Scheme membership analysis and maturity1 profile
Principal demographic assumptions

2019
Number2018
NumberContributors
Pensioners
Dependants
Deferred pensioners

9,337
19,922
4,351
28,4309,827
19,763
4,316
28,927

The total number of scheme beneficiaries as at 31 March 2019 was 48,478 (2018: 49,272). Membership numbers in the table above arehigher as members can hold more than one record. For example, contributing members who have transferred to the Career Average
Benefits 2011 section from another section of the scheme may have a deferred pensioner record for their benefits built up in the Old
Benefits, New Benefits or Career Average Benefits 2006 sections and a contributing record for their Career Average Benefits 2011
benefits.

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

G. Other continued
G2 Pension plans continued
G2.6 Scheme membership analysis and maturity1 profile continued
The average duration of the benefit obligation at the end of the reporting period is 21 years (2018: 21 years). This number can be
subdivided into the duration related to:—contributors: 26 years (2018: 26 years);—

pensioners: 14 years (2018: 14 years); and—deferred pensioners: 28 years (2018: 28 years).

G3 Financial instruments
This section details the financial instruments held by the BBC. A financial instrument is a contract that results in one entity recording afinancial asset (a contractual right to receive financial assets, e.g. cash) in their accounts and another entity recording a financial liability.
G3.1 Financial risk management
The BBC’s financial risk management operations are carried out by a BBC Group Treasury function, within parameters defined formallywithin the policies and procedures manual agreed by the Treasury Management Group which has delegated authority from the BBC
Board.
The BBC Group Treasury function uses financial instruments to raise finance and to manage financial risk arising from the BBC’s
operations in accordance with its objectives, which are:—to ensure the business of the BBC, both PSB Group and Commercial, is funded in the most efficient manner and remains compliant
with borrowing ceilings;—

to protect the value of the BBC’s assets, liabilities and cash flows from the effects of adverse interest rates and foreign exchange
fluctuations; and—to maximise the return on surplus funds, whilst ensuring sufficient cash is retained to meet foreseeable liquidity requirements.

The BBC takes a risk averse approach to the management of interest rate fluctuations and foreign currency trading and has implemented
a clear economic hedging policy to minimise volatility in the financial results. A small number of the forward foreign currency contracts
entered into by the BBC were designated as hedging instruments in effective cash flow hedges. Hedge accounting is only applied where
there is appropriate designation and documentation.
The BBC is exposed to the following areas of risk arising from financial instruments:
Risk

Exposure arising from

Measurement

Management

Market risk – currency risk

Transactions and balances
denominated in foreign
currencies

Cash flow forecasting

Forward foreign currency
contracts

Market risk – interest riskLong-term borrowings at
variable rates

Projected borrowing
requirements

Interest rate swaps, caps andcollars

Liquidity risk

Borrowings and other financial
liabilities

Rolling cash flow forecasts

Monitoring cash flow forecasts
and covenant compliance

Credit risk

Counterparty default on
contractual obligations

Credit ratings and aging
analysis

Assessment of financial reliability,
collateral and other credit
enhancements

1 See Glossary for further details

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N O T E S T O T H E AC C O U N T S

G. Other continued
G3 Financial instruments continued
G3.1 Financial risk management continued
Currency risk
Although the BBC is principally a UK-based organisation, some transactions are undertaken in currencies other than sterling.
The BBC’s commercial operations are undertaken in a range of global markets and a significant proportion of BBC Studio’s and Global
News’ incomes are generated outside the UK, and as a result are exposed to foreign exchange risk arising from various currencies –principally US dollar, the euro and the Australian dollar. Due to movements in exchange rates, the amount the BBC expects to receive or
pay when it enters into a transaction may differ from the amount that it actually receives or pays when it settles the transaction.
The BBC takes a risk averse approach to the management of currency risk and has implemented clear policy parameters utilising forward
foreign currency contracts to minimise volatility in the financial results. A substantial proportion of the BBC’s material net foreign
currency exposures are economically hedged.
The BBC is mainly exposed to US dollars; however, due to the relative size of this exposure in comparison to the BBC’s sterlingdenominated business, the BBC does not consider this to be significant. The BBC generally enters into forward currency contracts tomanage, or hedge, this currency risk. This allows the BBC to reduce risk by settling transactions at known exchange rates.
The overall income or expenditure to be recognised in relation to contracts denominated in foreign currencies (and the related hedges) istherefore fixed; however, where these contracts span financial years, the recognition of the fair value of the forward currency contracts
results in timing gains or losses in each financial year. These timing gains or losses are as a result of market conditions and not variancesin underlying contract value.
As a result, the BBC has mitigated its underlying exposure to currency fluctuations and therefore has not presented sensitivity analysis as
any potential variation is insignificant.
At 31 March 2019, the BBC had entered into a net commitment to sell foreign currencies amounting to £242 million (2018: £82 million)
that mature in the period through to 2023 in order to fix the sterling cost of commitments through this period (mainly euros and US
dollars).
The BBC applies hedge accounting for trades taken out by one of its commercial subsidiaries in respect of their forecast foreign currencytransactions1. Net gains (before tax and non-controlling interests) recognised in the hedging reserve on forward foreign exchange
contracts in hedge relationships at 31 March 2019 were £2 million (2018: £26 million). These amounts are recognised in the income
statement in the period when the hedged forecast transaction impacts the income statement.
The ineffective portion recognised in operating costs arising from such hedges was immaterial in both the current and prior year.
Interest rate risk
BBC Commercial Holdings’ 2013 private placement included a tranche of fixed rate sterling debt alongside a tranche of fixed rate US
dollar debt, with the latter swapped to fixed rate sterling throughout the period of the instrument. Since March 2003, BBC Commercial
Holdings has borrowed using its revolving credit facilities at floating rates of interest and then using interest rate swaps, caps and collars
to manage the BBC’s exposure to interest rate fluctuations and provide greater certainty of cash flows. Interest rate swaps, caps andcollars are entered into based on projected borrowing requirements, therefore differences will occur between the notional amount of theswaps, caps and collars and the actual borrowing requirements. By taking out the interest rate swaps, caps and collars the BBC has
mitigated underlying exposure to interest rate fluctuations and hence no sensitivity analysis has been presented as any potential
variation is insignificant.
Sterling fixed rate borrowings are achieved by entering into interest rate swap transactions; all outstanding swaps mature by the end ofJune 2020. In total, £165 million (2018: £154 million) of swaps were entered into. The coverage is £28 million lower (2018: £27 million
lower) than the current level of bank loans of £193 million (2018: £181 million).
Other price risk of financial assets
The BBC invests surplus cash in money market funds and money market deposits, therefore it is not subject to other price risks, such as
market price risk.
Liquidity risk
Liquidity risk is the risk that the BBC will not be able to meet its financial obligations as they fall due. The BBC is subject to limits on its
borrowings set by the Secretary of State in accordance with the Agreement between the BBC and DCMS (see note F2). In order to comply
with these limits, together with the terms of any individual debt instruments, the BBC’s Group Treasury function manages the BBC’s
borrowings by regularly monitoring cash flow forecasts. The BBC holds its surplus liquidity in term deposit accounts with highly rated
financial institutions.
The bank loans of the BBC’s commercial operations are subject to debt covenants based on the BBC’s earnings before interest andtaxation. The covenants are in respect of net borrowings and net interest coverage. The BBC is active in the monitoring of its debt
covenants which have been met at 31 March 2019.

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

G. Other continued
G3 Financial instruments continued
G3.1 Financial risk management continued
The following table sets out the contractual undiscounted cash flows (including interest) of financial liabilities:

2019

Non-derivative financial liabilities
Trade and other payables
Bank loans and overdrafts
Obligations under finance leases
Derivative financial liabilities
Forward foreign currency contracts – fair value throughsurplus/deficit
Cash flow swaps

2018

Non-derivative financial liabilities
Trade and other payables
Bank loans and overdrafts
Obligations under finance leases
Derivative financial liabilities
Forward foreign currency contracts – fair value throughother comprehensive income
Forward foreign currency contracts – fair value throughsurplus/deficit
Cash flow swaps
Embedded derivatives

Carrying value£m

Total contractual
cash flows£mLess than
one year£m

Between one andfive years£mOver five years
£m

(456)
(203)
(651)

(456)
(223)
(1,060)

(413)
(15)
(66)

(43)
(208)
(277)

–
–
(717)

(6)
(549)

(6)
(549)

(3)
–

(3)
–

–
(549)

Carrying value£m

Total contractual
cash flows£mLess than
one year£m

Between one andfive years£mOver five years
£m

(417)
(182)
(675)

(417)
(202)
(1,128)

(392)
(6)
(64)

(25)
(196)
(278)

–
–
(786)

(2)

(2)

(2)

–

–

(4)
(516)
(1)

(4)
(516)
(1)

(2)
–
–

(2)
–
(1)

–
(516)
–

Credit risk
Credit risk is the risk of financial loss to the BBC if a counterparty defaults on its contractual obligation.
Depending on how exchange rates and interest rates move between the time the BBC enters into the transaction and at the year end
reporting date, derivatives can either be profitable (‘in the money’) or loss-making in their own right. However, the rationale in entering
into these derivatives is not to profit from currency markets or interest rate fluctuations, but to provide stability to the BBC’s cash flows.
Other than where hedge accounting is applied, the movements relating to these derivatives (i.e. where they are either in profit orloss-making) are taken to the BBC’s statement of income and expenditure for the year.
The BBC’s credit risk management policy in relation to other trade receivables involves regularly assessing the credit quality ofcustomers, taking into account several factors such as their financial position and historical performance. The carrying amount offinancial assets included in the financial statements represents the BBC’s maximum exposure to credit risk in relation to these assets.
G3.2 Fair value1 of financial instruments
When calculating the fair value of the BBC’s financial instruments (subsequent to the initial recognition), the technique used isdetermined with reference to the classification in the 3-level hierarchy set out below. This disclosure helps to show the level ofjudgement that the BBC has used in calculating fair values, subsequent to the initial recognition.
Fair value hierarchy levels 1 to 3 are based upon the degree to which the fair value is observable.
—

Level 1 fair value measurements are those derived from quoted market prices (unadjusted) in active markets;—

Level 2 fair value measurements are those derived from inputs other than quoted prices included within level 1 that are observablefor the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and—Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are notbased on observable market data (unobservable inputs).

No transfers between these categories have occurred during the period.

1 See Glossary for further details

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N O T E S T O T H E AC C O U N T S

G. Other continued
G3 Financial instruments continued
G3.2 Fair value1 of financial instruments continued
Fair value hierarchy for those carried at fair value
or at amortised cost where fair value differs

Carrying value

Amortised
cost
£m

2019

Fair value
Fair value
through otherthrough comprehensive
surplus/deficit
income
£m
£m

Total
£m

Level 1£m

Level 2£m

Level 3
£m

Total
£m

Cash and cash equivalents
Trade and otherreceivables
Derivative financial assets:
Forward foreign currency
contracts1
Cash flow swaps
Interest rate swaps
Other investments
Investment properties

468

–

–

468

713

–

–

713

–
–
–
14
70

3
426
21
–
–

1
–
–
–
–

4
426
21
14
70

4
–
–
–
–

–
426
21
–
–

–
–
–
205
176

4
426
21
205
176

Total financial assets
Trade and other payables
Bank loans and overdrafts
Derivative financial
liabilities:
Forward foreign currency
contracts1
Cash flow swaps
Obligations under financeleases

1,265
(444)
(203)

450
(12)
–

1
–
–

1,716
(456)
(203)

4
–

447
–

381
(12)

832
(12)

–
–

(6)
(549)

–
–

(6)
(549)

(6)
–

–
(549)

–
–

(6)
(549)

(651)

–

–

(651)

–

–

(906)

(906)

Total financial liabilities(1,298)(567)–(1,865)

(6)

(549)

(918)

(1,473)

Fair value hierarchy for those carried at fair value
or at amortised cost where fair value differs

Carrying value

Amortisedcost£m

Fair value
throughsurplus/deficit£m

Fair value
through othercomprehensive
income
£m

Total
£m

523

–

–

523

646
1

–
–

–
–

–
–
–
14
70

11
418
8
–
–

Total financial assets
Bank loans and overdrafts
Trade and other payables
Derivative financial
liabilities:
Forward foreign currency
contracts1
Cash flow swaps
Embedded derivatives
Obligations under financeleases

1,254
(182)
(392)

Total financial liabilities

2018

Cash and cash equivalents
Trade and otherreceivables
Unquoted equities
Derivative financial assets:
Forward foreign currency
contracts1
Cash flow swaps
Interest rate swaps
Other investments
Investment properties

Level 1£m

Level 2£m

Level 3
£m

Total
£m

646
1

–

–

1

1

1
–
–
–
–

12
418
8
14
70

12
–
–
–
–

–
418
8
–
–

–
–
–
194
175

12
418
8
194
175

437
–
(25)

1
–
–

1,692
(182)
(417)

12

426

370

808

–

–

(25)

(25)

–
–
–

(4)
(516)
(1)

(2)
–
–

(6)
(516)
(1)

(6)
–
–

–
(516)
–

–
–
(1)

(6)
(516)
(1)

(675)

–

–

(675)

–

–

(936)

(936)

(1,249)

(546)

(2)

(1,797)

(6)

(516)

(962)

(1,484)

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

G. Other continued
G3 Financial instruments continued
G3.2 Fair value1 of financial instruments continued
Due to their short-term nature, the carrying value of cash and cash equivalents, short-term bank loans, trade and other receivables andtrade and other payables, is approximately equal to their fair value.
Level 2 – cash flow swap derivatives
Cash flow swaps represents derivative financial assets of £426 million (2018: £418 million) and derivative financial liabilities of £549
million (2018: £516 million) relating to the financing arrangement of Broadcasting House. These swaps, which expire between 2033 and2045, are valued with reference to relevant SONIA and LIBOR yield curves, subject to appropriate credit risk adjustments where
necessary. An adjustment of 250 basis points is applied to a specific leg of the swaps to reflect credit risk as the arrangement with thecounterparty is not collateralised. These assumptions and inputs are reviewed on an annual basis, along with the completion ofsensitivity analysis. A change in the credit risk adjustment, reflecting the cumulative market movements since the inception of the swap,
would result in an increase in the net liability of £2 million. The net liability would decrease by £7 million should an alternative
appropriate index be used as a proxy for the credit risk adjustment, taking into account the cumulative movements since inceptionof the swap.
Level 3 financial instruments
The change in fair value of level 3 financial instruments is reconciled as follows:
2019

2018

Financialassets£m

Financialliabilities£mFinancialassets£m

Financialliabilities£m

At 1 April
Payments
Settlements
Unwinding of discount recorded within finance expense
Disposal of available for sale asset
Additions
IFRS 9 cumulative catch-up
Change in fair value recorded in other gains and losses
Change in fair value

370
–
–
–
–
–
(1)
–
12

(962)
68
–
(48)
–
–
1
15
8

412
–
–
–
(7)
1
–
–
(36)

(999)
67
2
(48)
–
(22)
–
4
34

At 31 March

381

(918)

370

(962)

The IFRS 9 Financial Instruments cumulative catch-up adjustment to opening reserves has a net impact of nil. Under IAS 39, unquoted
equities were measured at cost and are now measured at fair value under IFRS 9. The change in value of £1 million between the balance
at 31 March 2018 under IAS 29 and 1 April 2019 under IFRS 9 has been released as a debit to the opening reserves. Embedded
derivatives relating to financial asset host contracts are no longer separated under IFRS 9 and instead the contract is measured entirely
under amortised cost. The change in value of £1 million between the balance at 31 March 2018 under IAS 39 and 1 April 2019 under IFRS
9 has been released as a credit to the opening reserves.
Other investments – Daunus Limited
In order to facilitate the redevelopment and subsequent financing arrangement relating to Broadcasting House, the BBC holds aninvestment in Daunus Limited, which is included within level 3 financial instruments with a fair value of £205 million (2018: £193 million).
The BBC holds a 20% (2018: 20%) share of the issued share capital (preferential in nature), due to mature in 2033, at which point the BBC
receives certain rights in respect of Broadcasting House. The BBC’s share in Daunus Limited entitles it to the first £125 million (plus RPIfrom the start of the lease) of any proceeds on termination of the lease. The fair value has therefore been derived from £125 million,
inflated by RPI and subsequently discounted to 31 March 2019. The estimated interest rate used was 2.9% (2018: 3.6%) and the rate used
to discount the future cash flows was 1.5% (2018: 1.8%). These assumptions and inputs are reviewed on an annual basis, along with thecompletion of a sensitivity analysis. A change in the adjustment applied to the respective interest rate of +1.0% would result in an
increase in the net assets by £32 million (2018: £32 million) whilst a reduction in the respective interest rate of -1.0% would result in adecrease in the net assets of £28 million (2018: £28 million).
The fair value of the investment in Daunus Limited is not included on the balance sheet as it is equity accounted for through the income
statement (see note E3). This is due to the BBC sharing joint control with other investors, including voting power and right to veto overrelevant activities, along with significant shared exposure to variable returns. The assumptions relating to Daunus Limited are reviewed
on an annual basis, along with the completion of a sensitivity analysis. Whilst the reported profit or loss of Daunus Limited is not asignificant input, the decision that Daunus Limited is a joint venture is a significant judgement.

1 See Glossary for further details

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N O T E S T O T H E AC C O U N T S

G. Other continued
G3 Financial instruments continued
G3.2 Fair value1 of financial instruments continued
Obligations under finance leases
Level 3 financial liabilities also include the BBC’s obligations under finance leases, with a fair value of £906 million (2018: £936 million),
which predominantly relate to the lease of three properties. This is £255 million higher than their carrying value (2018: £261 million). The
fair value has been determined by recalculating the finance lease liability using current market interest rates with an appropriate risk
adjustment. The movement in interest rates between inception of each finance lease and the balance sheet date creates a difference
between carrying value and fair value. These assumptions and inputs are reviewed on an annual basis, along with the completion of asensitivity analysis relating to the aforementioned three property leases. A change in the interest rate applied of +0.5% would result in adecrease in the liability of £32 million (2018: an increase of +0.25% would result in a decrease in the liability of £18 million) whilst a
reduction in the respective interest rate of -0.5% would result in an increase in the net liability of £34 million (2018: a reduction of-0.25% would result in an increase in the net liability of £18 million).
These leases also include provisions to provide for the BBC’s share of any appreciation in market value.
G4 Gains on disposals

Gain on disposal of Good Food
Other gains

2019
£m

2018
£m

29
7

–
5

36

5

2019
£m

2018
£m

(8)
15
–

21
2
2

7

25

G5 Other gains and losses

Change in fair value of derivative financial instruments
Change in fair value of put options over non-controlling interests
Decrease in earn-out payments due in respect of prior acquisitions

G6 Interests in associates, joint ventures and subsidiaries
The BBC Group holds (directly and indirectly) interests in the associates, joint ventures and subsidiaries listed below which, except whereotherwise stated, are incorporated in Great Britain and registered in England and Wales.
G6.1 Significant associates and their activities
Name of entity

Place of incorporation andprincipal place of businessHolding of issued ordinary shares %Activity

YouView TV Limited
New Video Channel America LLC*
3sixtymedia Limited**

England and Wales
United States
England and Wales

14.2%
50.1%
10.0%

Multiplatform broadcasting
TV channel operator
Production*

Whilst BBC Studios Distribution Limited retain a significant influence over New Video Channel America LLC and has the rights to variable returns, it is not deemed to havecontrol and is therefore recognised as an associate undertaking.
** The BBC holds 10% of the total share capital of 3sixtymedia Limited but 20% of the Class A ordinary shares, which gives it significant influence.

G6.2 Significant joint ventures and their activities
Name of entity

Place of incorporation andprincipal place of businessHolding of issued ordinary shares %Activity

Commercial joint ventures:
UKTV Media Holdings Limited
Daunus Limited*

England and Wales
England and Wales

50%
20%

TV channel operator
Property*

The BBC holds 20% of the total share capital of Daunus Limited but 66% of the voting rights. Other shareholders retain certain veto rights and therefore this entity is recognised
as a joint venture.

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

G. Other continued
G6 Interests in associates, joint ventures and subsidiaries continued
G6.3 Subsidiary undertakings1
Name of entity

Registered address

Directly owned commercial subsidiaries: (all 100% owned unless stated)
BBC Commercial Holdings Limited
Broadcast Centre Media Village, 201 Wood Lane, London W12 7TP
BBC Property Limited
BBC Property Investment Limited
BBC Property Development Limited
Centre House Productions Limited
BBC News Limited
BBC Free to View (Satellite) Limited
BBC Free to View Limited
Media Applications Technologies Limited
BBC Subscription Television Limited
BBC Investments Limited
BBC Digital Programme Services Limited
World Service Trading Limited
BBC World Service Holdings Limited

London Broadcasting House, Portland Place, London W1A 1AA

DSHS Limited

The Lighthouse, 201 Wood Lane, London W12 7TQ

Indirectly owned commercial subsidiaries: (all 100% owned unless stated)
BBC Studios Limited (formerly BBC Studios Group Limited)
1 Television Centre, 101 Wood Lane, London W12 7FA
BBC Studios Distribution Limited (formerly BBC Worldwide
Limited)2 Entertain Limited
2 entertain Management Limited
2 entertain Video Limited
BBC Video Limited
MCI Music Publishing Limited
Demon Music Group Limited
Crimson Productions Limited
F-Beat Records Limited
Demon Records Limited
BBC Earth MD (WWD) Limited
BBC Earth Productions (Life) Limited
BBC Earth Productions Limited
BBC Earth Productions (Giant Films) Limited
Earth Film Productions Limited
BBC Magazine Holdings Limited
BBC Studios Corporate Services Limited
BBC Studios Investments Limited
BBC Studios Drama Productions Limited
BBC Studios Productions Limited
Tonto Films and Television Limited
BBC Studios Channel Investments Limited
Mortimer Productions Limited
UK Programme Distribution Limited (92.683% owned)
beeb Rights Limited (88.402% owned)
BBC Global News Holdings Limited
BBC Global News Limited
BBC World Distribution Limited
BBC.com Limited

Broadcasting House, Portland Place, London W1A 1AA

BBC Studios Productions Limited
BBC Grafton House Productions Limited
BBC Children’s Productions Limited
BBC Comedy Productions Limited
BBC Natural History and Factual Productions Limited
BBC Natural History Giant Screen Limited
BBC Studios Productions (Clifton) Limited
BBC Store Limited

1 Television Centre, 101 Wood Lane, London W12 7FA

1 See Glossary for further details

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N O T E S T O T H E AC C O U N T S

G. Other continued
G6 Interests in associates, joint ventures and subsidiaries continued
G6.3 Subsidiary undertakings1 continued
Name of entity

Registered address

BBC Studioworks Limited

Room N101, Neptune House, BBC Elstree Centre, Clarendon Road,
Borehamwood, Hertfordshire WD6 1JF

Baby Cow Productions Limited (72.994% owned)
Baby Cow Manchester Limited
Baby Cow Productions (Hunderby) Limited
Baby Cow Productions (Partridge) Limited
Baby Cow Productions (Red Dwarf) Limited
Baby Cow Films Limited
Alan Partridge Limited
Baby Cow Animation (Warren) Limited
Baby Cow Animation (Wussywat) Limited
Baby Cow Animation Limited
Baby Cow Films (Zoe) Limited
The Last Holiday Limited

1 Television Centre, 101 Wood Lane, London W12 7FA

Sid Gentle Films Limited (51% owned)
Sid Gentle Films (Corfu) Limited
Sid Gentle Films (Gaiman) Limited
Sid Gentle Films (KE2) Limited
Sid Gentle Films (Killing Eve) Limited
Sid Gentle Films (OLIVE) Limited
Sid Gentle Films (SS-GB) Limited
Sid Gentle Films (TD4) Limited
Sid Gentle Films (The Durrells) Limited

Charles House, 5-11 Regent Street, St James’s Way, London
SW1Y 4LR

Lookout Point Limited
A Suitable Company Limited
AMP 1 Limited
Evergreen Television Limited
LOOKOUT POINT (LES MISERABLES) Limited
LOOKOUT POINT (SHIBDEN) Limited
Lookout Point Acquisition Limited
Off Stone Productions Limited
Lookout Point (The Collection) Limited

Hammer House, 113-117 Wardour Street, London W1F 0UN

BBC Studios Canada Limited

409 King Street West, 5th Floor, Toronto, ON, M5V 1K1, Canada

BBC Studios PTE. Limited

3 Anson Road, #17-03 Springleaf Tower, Singapore 079909

BBC Studios Japan Limited

Tokyo Club Bldg., 10F, 3-2-6 Kasumigaseki, Chiyoda-ku, Tokyo
100-0013, JapanBBC Studios Productions Nordics ApS

Mosedalvej 14, 2500 Valby, DenmarkBBC.com US, Inc

c/o Corporation Trust Centre, 1209 Orange Street, Wilmington
19801, United States New Castle, Delaware 19801

Nine Productions1 Inc

650-699 Howe Street Vancouver, British Columbia, V6 0B4, Canada

BBC Studios France

18-20 Quai du Point du Jour, Bat. A, 92100 Boulogne-Billancourt,
FranceBBC Studios Channel Investments (Ontario) Limited

Toronto Dominion Bank Tower, Toronto Dominion Center, Toronto,
ON M5K 1E6, Canada

2004370 Inc

66 Wellington Street West 470, Toronto Dominion Bank Tower,
Toronto M5k 1EG, Canada

BBC Studios Americas Inc

1120 Avenue of the Americas, 5th Floor, New York, NY 10036-6700,
United States

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

G. Other continued
G6 Interests in associates, joint ventures and subsidiaries continued
G6.3 Subsidiary undertakings1 continued
Name of entity

Registered address

Adjacent Productions, LLC
Bad Wolf Productions LLC
BBC Studios Reality Productions LLC
Global Hybrid Productions LLC
Lime Grove Productions LLC
Sun Never Sets Productions LLC
Studios Competition Productions LLC

10351 Santa Monica Boulevard, Los Angeles, CA 90025, UnitedStatesBBC Studios Americas Investments Inc

The Corporation Trust Company, Corporation Trust Centre, 1209
Orange Street, Wilmington 19801, United States

BBC Studios Australia Holdings Pty Limited
BBC Studios Australia Pty Limited
BBC Studios Productions Australia Pty Limited

Level 1, 35-51 Mitchell Street, McMahons Point NSW 2060,
Australia

BBC Studios Germany GmbH
Erste Weltweit Medien GmbH

Kaiser-Wilhelm-Ring 17-21, 50672 Köln, Germany

BBC Worldwide Holdings B.V

Prins Bernhardplein 200, 1097 JB Amsterdam, Netherlands

BBC Studios India Private Limited

Construction House A Wing, 401- 4th Floor, Off Linking Road, 24th
Road, Khar (W), Mumbai 400 052 India

BBC Studios Africa (Pty) Limited

Office 003H3 Ground Floor, 10 Melrose Boulevard, Melrose Arch,
Melrose North 2196, SA

BBC Studios Intermediadora de Programadora Estangeira Limited

Rua Ferreira de Araujo, 741, Andar 1, Pinheiros, São Paulo
SP 05.428-002 Brazil

BBC Studios Polska Sp z o.o.

Pl. Bankowy 1, 00-139 Warszawa, Poland

BBC Worldwide Mexico S.A de C.V
BBC Worldwide Channels Mexico S.A de C.V

Avenida Paseo de la Reforma No 115, Piso 4 Lomas de Chapultepec,
Distrito Federal 11000 Mexico

Worldwide Knowledge (Beijing) Business Consulting Company Ltd

Unit 7, Floor 9, West Tower, Genesis Building, 8 Xinyuan South Road,
Chaoyang District, Beijing 100027

BBC Studios Productions (Africa) (Pty) Limited

24 18th Street, Menlo Park 0081, Maxars House, 5 St Davids Place,
Parktown 2193, SA

Rapid Blue

263 Oak Avenue, Ferndale, Randburg, 2194, South Africa

BBC Global News (Japan) Limited (incorporated in Japan)

Tokyo Club Bldg., 3-2-6, Kasumigaseki, Chiyoda-ku, Tokyo, 1000013, JapanBBC Global News (Singapore) Private Limited (incorporated in
Singapore)#12-08/08 Shaw Tower, 100 Beach Road Singapore 189702,
Singapore

BBC Global News (India) Private Limited (incorporated in India)

Unit No. 301, 3rd Floor, D-2, Southern Park, District Centre, Saket,
New Delhi, 110017

BBC Global News US LLC (incorporated in America)

Corporation Service Company, 80 State Street, Albany, New York,
12207-2543

1 See Glossary for further details

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N O T E S T O T H E AC C O U N T S

G. Other continued
G7 Reserves
G7.1 Operating reserve
The operating reserve reflects accumulated profits to date and the one-off cumulative catch-up adjustment of £5 million due to thetransition to IFRS 15 Revenue from Contracts with Customers, hence this will amount to the difference in 2017/18 closing and 2018/19
opening retained earnings. The cumulative catch-up adjustment is an entry to opening retained earnings to reflect the changes in income
recognition due to IFRS 15 under the modified retrospective transition method. Refer to the accounting policies section for further
information on the transition.
G7.2 Hedging reserve
The hedging reserve is used to record the effective portion of cumulative net changes in the fair value of cash flow hedging instruments,
related to hedged transactions that have not yet occurred (net of tax). During the current year, losses of £4 million were removed fromthe hedging reserve and debited to income in the income statement (2018: £17 million).
G7.3 Translation reserve
The translation reserve comprises all foreign exchange differences arising since the transition to IFRS, from the translation of thefinancial statements of foreign operations, as well as from the translation of liabilities that hedge the BBC’s net investment in foreignsubsidiaries.
G7.4 Other reserves
Other reserves include the fair value of put option liabilities arising on acquisition of subsidiaries and the difference between the cost ofinvestment and net assets of entities acquired which are held under common control.
G8 Post-balance sheet events
On 11 June 2019, the UKTV group, a joint venture previously owned by BBC Studios Distribution Limited and Southbank Media Limited,
was demerged and had its ownership restructured. The three leisure-themed channels were separated from the group, and BBC Studios
obtained 100% ownership and control of UKTV Holdings Limited and its remaining seven entertainment channels, as well as UKTV Playand the UKTV brand. The principal reason for this acquisition was that these channels are closely aligned to BBC Studio’s own content
strategy and supply. The total cash payment due from BBC Studios of £173 million is payable over two years. This includes a cash
consideration of £106 million in relation to the channels acquisition, and the assumption of £67 million of debt, previously financed by thejoint venture counterparty. This acquisition was financed through existing borrowing facilities. As outlined in note E3, for the year ended
31 March 2019, UKTV had total revenues of £332 million and profit of £53 million, and had gross assets of £266 million and net assets of£94 million. Owing to the timing of the transaction occurring close to the date of signing of the 2019 financial statements, full acquisition
accounting has not yet been completed, including calculation of goodwill on acquisition and potential recognition of other intangible
assets. Full acquisition accounting information is expected to be provided in the financial statements for the year ending 31 March 2020.
Following a public consultation, the BBC Board announced on the 10 June 2019 that it has decided from June 2020 any household withsomeone aged over 75 who receives Pension Credit will be entitled to a free TV licence paid for by the BBC. This decision means everyone
will continue to receive the best programmes and services that the BBC can provide.
G9 Related party transactions
The following table represents transactions with related parties excluding key management personnel.
Associates, joint venturesand other investments

Rendering of services
Receiving of services
Pension contributions
Dividends received

BBC Pension Scheme

2019
£m

2018
£m

2019
£m

2018
£m

83
(89)
–
28

90
(102)
–
39

–
–
191
–

–
–
155
–

22

27

191

155

Amounts owed by related parties

Amounts owed to related parties

2019
£m

2018
£m

2019
£m

2018
£m

47

34

(19)

(9)

47

34

(19)

(9)

Associates, joint ventures and other investments

In all transactions, terms were negotiated on an arm’s length basis.
The BBC also enters into various transactions with Government and local authorities on an arm’s length basis. These transactions include
council tax agreements and corporation tax payments.
Related party transactions with key management personnel are disclosed in note C5.

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F I N A N C I A L S TAT E M E N T S

G. Other continued
G9 Related party transactions continued
During the year the BBC received less than £0.1 million of income and incurred less than £0.1 million of expenditure with BBC Children in
Need. At 31 March 2019, the BBC had a debtor balance of £0.6 million (2018: £0.5 million) with this entity, predominantly relating to therecharge of employee costs. At year end, the BBC also had a debtor balance of £0.6 million with Media Action UK (2018: £0.6 million).
At the end of the year the BBC was owed £0.4 million (2018: £0.4 million) by the BBC Pension Scheme and was due to pay £0.6 million(2018: £0.4 million) to the BBC Pension Scheme.
G10 Segment reporting
Geographical location of income and non-current assets
2019

Non-current assets excluding deferred tax andfinancial instruments:
UK
America
Australia
Rest of world
Additions included in non-current assets andinvestments
External income:UK
America
Australia
Rest of world2018*

Non-current assets excluding deferred tax andfinancial instruments:
UK
America
Australia
Rest of world
Additions included in non-current assets andinvestments
External income:UK
America
Australia
Rest of world*

PSB Group£m

BBC Studios
£m

Other
commercials
£m

Group
adjustments
£m

Group
£m

1,307
2
–
68

289
186
14
8

278
–
–
–

(512)
–
–
–

1,362
188
14
76

1,377

497

278

(512)

1,640

133

218

2

(2)

351

3,997
9
1
10

529
241
70
349

67
33
7
76

(500)
–
–
–

4,093
283
78
435

4,017

1,189

183

(500)

4,889

PSB Group£m

BBC Studios
£m

Other
commercials
£m

Group
adjustments
£m

Group
£m

1,334
2
–
70

267
190
14
5

279
–
–
–

(511)
–
–
–

1,369
192
14
75

1,406

476

279

(511)

1,650

243

181

146

(262)

308

4,120
6
–
5

567
256
76
337

48
33
3
75

(464)
–
–
–

4,271
295
79
417

4,131

1,236

159

(464)

5,062

The presentation of this table has been adjusted to reflect more granularity over the results.

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BBC Group Annual Report and Accounts 2018/19

245

N O T E S T O T H E AC C O U N T S

H. Basis of preparation of the financial statements and otheraccounting policies
The BBC is incorporated in the United Kingdom by Royal Charter.
Statement of accounting policies
The BBC is required to select and apply accounting policies foreach type of transaction entered into throughout the year and in
the preceding year. An accounting policy will specify the timing forrecognising and derecognising assets, liabilities, income andexpenditure, how those items will subsequently be measured andwhere they are presented in the statement of total income andexpenditure, balance sheet and statement of cash flows.
Use of estimates and judgements
The preparation of financial statements requires the use of certain
critical accounting estimates that affect the reported performanceand position of the BBC, or areas where assumptions or estimates
are significant to the consolidated financial statements.
It also requires management to exercise judgement in applying theBBC’s accounting policies. These areas involve a higher degree ofjudgement or complexity.
The areas involving a higher degree of judgement or complexity are
set out below and in more detail in the related notes:—

Income recognition (note A);—

Provisions and accruals (notes F10 and F9);—

Property, plant and equipment (note D1);—

Pension scheme and actuarial assumptions (note C7); and—Derivative financial assets and liabilities (note G3).

Basis of preparation
These consolidated financial statements for the BBC have been
prepared in accordance with IFRS as adopted by the EU. Additional
analysis is also presented to meet regulatory additional
requirements including those prescribed by DCMS, Ofcom or theCharter.
The financial statements are principally prepared on the historicalcost basis. Exceptions are noted within the relevant section of thenotes.
Where items are sufficiently significant by virtue of their size or
nature, they are disclosed separately in the financial statements inorder to aid the reader’s understanding of the BBC’s financial
position and performance.

Adoption of new and revised accounting standards
The following new and revised EU-endorsed accounting standards
have been adopted for the first time. They have been applied since
1 April 2018 and have not had a significant impact on the results orfinancial position of the BBC:—IFRS 9 Financial Instruments;—

IFRS 15 Revenue from Contracts with Customers (including
Clarifications to IFRS 15 Revenue from Contracts with
Customers);—

Classification and Measurement of Share-based Payment
Transactions (amendments to IFRS 2);—

Applying IFRS 9 Financial Instruments with IFRS 4 Insurance
Contracts (amendments to IFRS 4);—

Transfers of Investment Property (Amendments to IAS 40);—

Annual Improvements to IFRS 2014-2016 Cycle (Amendments
to IFRS 1);—

Annual Improvements to IFRS 2014-2016 Cycle (Amendments
to IAS 28); and—IFRIC 22 Foreign Currency Transactions and Advance
Consideration.

IFRS 9 Financial Instruments
IFRS 9 sets out requirements for recognising and measuring
financial assets, financial liabilities and some contracts to buy orsell non-financial items. This standard replaces IAS 39 Financial
Instruments: Recognition and Measurement.
As a result of the adoption of IFRS 9, the BBC has also adopted
consequential amendments to IAS 1 Presentation of Financial
Statements, which require impairment of trade receivables andother contract assets to be presented in a separate line item in thestatement of profit or loss where material. As this is not material to
the Group it continues to be reported within operating
expenditure. Impairment losses on other financial assets arepresented separately under finance costs, similar to thepresentation under IAS 39, again due to materiality considerations.
Additionally, the BBC has adopted consequential amendments to
IFRS 7 Financial Instruments: Disclosures that are applied todisclosures about the current financial year but have not been
generally applied to comparative information. The adoption of IFRS
9 did not result in a material adjustment to previously reported
results.
Further detail on how the BBC accounts for financial instruments
can be found on page 253.

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BBC Group Annual Report and Accounts 2018/19

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F I N A N C I A L S TAT E M E N T S

H. Basis of preparation of the financial statements and other accounting policies continued
A summary of the changes in classification of financial instruments resulting from the new accounting standards is disclosed in the tablebelow:

Forward foreign currency contracts – fairvalue through other comprehensive income

Classification under IAS 39

Classification under IFRS 9

Fair value through other comprehensive
incomeFair value through other comprehensive
incomeForward foreign currency contracts – fairvalue through surplus/deficit

Fair value through surplus/deficit

Fair value through surplus/deficit

Unquoted equities

Available for sale

Fair value through surplus/deficit

Trade and other receivables

Loans and receivables

Amortised cost

Cash and cash equivalents

Loans and receivables

Amortised cost

Bank loans

Loans and receivables

Amortised cost

Trade and other payables

Loans and receivables

Amortised cost

Other creditors (put options)

Fair value through surplus/deficit

Fair value through surplus/deficit

IFRS 15 Revenue from Contracts with Customers
The BBC has adopted IFRS 15 with a date of initial application of
1 April 2018. IFRS 15 establishes a comprehensive framework fordetermining whether, how much and when, revenue is recognised.
It replaces IAS 18 Revenue, IAS 11 Construction Contracts andrelated interpretations.
The BBC has applied IFRS 15 using the cumulative effect method– i.e. by recognising the cumulative effect of applying IFRS 15 as an
adjustment to the opening balance of equity at 1 April 2018.
Therefore, the comparative information has not been restated andcontinues to be reported under IAS 18 and IAS 11. The details of
the significant changes and quantitative impact of the changes are
set out below.
The cumulative catch-up adjustment required under the
cumulative effect method is made up exclusively from Content andformat sales other than a £1 million adjustment to interests inassociates and joint ventures that relates to production fee
income. Overall the effect on income is immaterial due to similar
contract values over 2019. Materially affected line items areshown in the table above. No other line items would have beenmaterially affected had IFRS 15 not been adopted for the 2019financial statements. Comparative prior year periods have notbeen adjusted.
The impact of this change in the current year has been to reduceincome by £6 million and operating costs by £2 million, giving a net
reduction on profit for the year of £4 million.
On the balance sheet, investments in joint ventures and associates
increased by £1 million, trade and other payments reduced by £1
million and operating reserves increased by £0.3 million (of which£5 million related to the brought forward position).
There has been no impact of adopting IFRS 15 on the BBC’s
consolidated statement of comprehensive (loss)/income orconsolidated cash flow statement.
Further detail on how the BBC accounts for income from contracts
with customers can be found on page 248.
Going concern1
The financial statements are prepared on a going concern basis.
The directors believe this to be appropriate for the reasons set out
below.

The directors have prepared and reviewed cash flow forecasts forthe 24-month period to 31 March 2021, a period in excess of a year
from the date of approval of these financial statements. In the
directors’ judgement, the key factors in these forecasts are thecontinuity of the Charter and licence fee, the BBC Pension Scheme
deficit and the resultant deficit recovery payments agreed with thepension scheme Trustees, and the realisation of planned costsavings under the ‘Strategic Plan’ programme.
The Charter and licence fee give the BBC a secure source ofincome, however the timing of cash flows is an important factor in
the consideration of going concern given the borrowing
restrictions agreed with the DCMS for both the PSB Group (£200
million) and the commercial operations of the BBC (£350 million).
An additional £2 billion is available to the PSB Group in 2020 tofund leases and £150 million for the commercial operations.
The BBC has external funding available, including a £200 million
sterling revolving credit facility which expires on 31 July 2020,
which is currently unutilised. PSB net debt at 31 March 2019 was£382 million, which equates to a headroom of £668 million against
the external funding available.
The BBC also has a £380 million multicurrency revolving credit
facility available to the BBC commercial operations, with funding
split between a US$259 million US Private Placement (fixed
through foreign exchange swap transactions at £171 million) until
June 2020 and a £210 million facility until March 2024. As at theyear end, the BBC had drawn down £193 million of the facilities
available (2018: £181 million).
The directors of the BBC have reviewed the cash flow forecasts
and available external borrowing facilities. Together with thesensitivities and mitigating factors in the context of available
funds, they expect the BBC to be able to meet its debts as they fall
due for the foreseeable future.
As a result, the directors are satisfied that the going concern basis
is appropriate for the preparation of these financial statements.
Basis of consolidation
The BBC financial statements include the results of the BBC and allbusinesses controlled by the BBC (subsidiaries) together with theBBC’s share of the results of businesses over which the BBC hassignificant influence but not control (associates) and those which
the BBC jointly controls (joint ventures).

1 See Glossary for further details

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247

N O T E S T O T H E AC C O U N T S

H. Basis of preparation of the financial statements and otheraccounting policies continued
The BBC accounts for its interests in associates and joint venturesusing the equity method. The equity method means that the BBC
presents its interest in associates or joint ventures as a single line
item in the balance sheet, measured at the cost of the investment
plus the share of the net result, less dividends received. The equity
accounted result for the year is presented as a single line item inthe statement of income and expenditure.

Monetary assets and liabilities denominated in foreign currencies
at the balance sheet date are translated into sterling at the rate ofexchange ruling at that date. Foreign currency gains or losses
arising from the translation of assets and liabilities at these rates
of exchange, together with exchange differences arising fromtransactions settled during the year, are included in the income
statement within operating costs. Non-monetary assets andliabilities measured at historical cost are translated into sterling at
the rate of exchange on the date of initial recognition.

Changes in the BBC’s interests in subsidiaries that do not result in aloss of control are accounted for as equity transactions, being
movements between reserves attributable to the BBC andnon-controlling interests. A non-controlling interest is the interestin a subsidiary that is not owned, directly or indirectly, by the BBC.
The non-controlling interest reflects the amount of the net result
for the year and the net assets/(liabilities) which are not
attributable to the BBC. The carrying amounts of non-controllinginterests are adjusted to reflect any changes in their, and theBBC’s, relative interests in the subsidiaries. Any difference between
the amount by which the non-controlling interests are adjusted
and the fair value of the consideration paid or received isrecognised directly in equity and attributed to the BBC.

Financial statements of foreign operations
The assets and liabilities of foreign operations are translated into
sterling at the rate of exchange ruling at the balance sheet date.
The income and expenses of foreign operations are translated into
sterling at average rates of exchange ruling during the financial
period, which is a good approximation for the actual rate. Exchange
differences arising on translation are recognised directly in thetranslation reserve.

When the BBC loses control of a subsidiary, the profit or loss on
disposal is calculated as the difference between (i) the aggregate of
the fair value of the consideration received and the fair value of any
retained interest and (ii) the previous carrying amount of the net
assets of the subsidiary (including attributable goodwill) and any
non-controlling interests. Amounts previously recognised in othercomprehensive income in relation to the subsidiary are reclassified
to the income statement or transferred directly to retained
earnings as appropriate. The fair value of any interest retained in
the former subsidiary at the date when control is lost is regarded as
the cost on initial recognition of an investment in an associate or
joint venture.
Business combinations
The acquisition of subsidiaries is accounted for using theacquisition method. The cost of an acquisition is measured at theaggregate of the fair values, at the date of exchange, of assets
given by the BBC in exchange for control of the acquire. The
acquiree’s identifiable assets, liabilities and contingent liabilities
that meet the conditions for recognition under IFRS 3 arerecognised at their fair value at the acquisition date. Subsequentadjustments to the fair values of net assets acquired are madewithin 12 months of the acquisition date where original fair values
were determined provisionally. These adjustments are accounted
for from the date of acquisition. Transaction costs that the BBC
incurs in connection with a business combination, such as legal
fees, due diligence fees and other professional and consulting fees,are expensed as incurred. On acquisition, the BBC recognises any
non-controlling interest either at fair value or at the noncontrolling interest’s proportionate share of net assets.
When control is obtained in successive share purchases (a ‘step
acquisition’) it is accounted for using the acquisition method at theacquisition date. The previously held interest is remeasured to fairvalue at the acquisition date and a gain or loss is recognised in theincome statement.
Foreign currency transactions
Transactions in foreign currencies are translated into sterling at
the rates of exchange ruling at the date of the transactions.

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BBC Group Annual Report and Accounts 2018/19

On disposal of an investment in a foreign operation, the associatedtranslation reserve balance is released to the income statement.
Accounting policies relevant to section A
Licence fee income
Income from television licences is treated as an amount due fromthe relevant Government department, principally the DCMS. This
represents the value of licences issued in the year, less a deduction
for refunds and cancellations.
Where an element of the licence fee income has been ring-fenced
by the Government for a specific purpose, that income isrecognised when it is due, except if it becomes virtually certain thatthe BBC’s expenditure on the ring-fenced purposes will be lessthan the ring-fenced income already received. In this case, therelevant amount of licence fee income, as agreed with theGovernment, will be repayable and recognised as such in the year
the obligation to repay arises.
Other income
Other income arises from activities such as the sale of goods,
provision of services and granting of licences. Income is measured
after deductions for value added tax, any other sales taxes, trade
discounts and sales between BBC companies.
Income from contracts with customers
Income is measured based on the consideration specified in acontract with a customer and excludes amounts collected onbehalf of third parties. Income recognition is based on the deliveryof performance obligations and an assessment of when control istransferred to the customer. The complexity of individual
contractual terms may require the BBC to make judgements inassessing when the triggers for income recognition have been met,
particularly whether the BBC has sufficiently fulfilled its
obligations under the contract to allow income to be recognised.
Income is recognised either when the performance obligation in
the contract has been performed (‘point in time’) or ‘over time’ as
control of the performance obligation is transferred to thecustomer. A performance obligation must meet one of the threecriteria in IFRS 15 to meet ‘over time’ recognition. The default
category, if none of these criteria are met, is ‘point in time’recognition. Further detail on the category of income recognition
for each income stream can be found below.

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F I N A N C I A L S TAT E M E N T S

H. Basis of preparation of the financial statements and otheraccounting policies continued
IFRS 15 provides more comprehensive guidance for contracts tolicence intellectual property, or contracts where licence ofintellectual property is a significant component. Each performanceobligation is identified and evaluated as to whether it represents aright to access the content (revenue recognised over time) or
represents a right to use the content (revenue recognised at apoint in time), and all three of the criteria referred to above must
be met to meet the definition of a ‘right to access’ licence. The
majority of the Group’s contracts to licence intellectual property
have defaulted to a ‘right to use’ licence and recognised at a ‘point
in time’.
The transaction price, being the amount to which the BBC expects
to be entitled and has rights to under the contract, is allocated tothe identified performance obligations. Most of the BBC’s income
is derived from fixed price contracts and therefore the amount ofincome to be earned from each contract is determined byreference to those fixed prices. Royalties, as the exception, aregenerally set as a metric/percentage of sales generated.
The allocation of the transaction price to the performanceobligations is at the amount that depicts the consideration towhich the BBC expects to be entitled in exchange for goods orservices transferred. This is generally done in proportion to thestand-alone selling prices.
The BBC’s main sources of contract income are recognised asfollows:—

Content and format sales
Licence fees from programme content and programme
formats are recognised on the latter of the start of the licence
period (taking into account any holdback dates) or when theGroup’s performance obligations have been satisfied. For
content sales the performance obligation will generally be todeliver the associated programme to the customer, therefore
income is recognised ‘episodically’ – on delivery of each
episode. For format sales, there are two performanceobligations – to provide the format ‘bible’ and in some cases
production assistance. Income is allocated to each of these
performance obligations based on stand-alone selling prices
and recognition at the two separate ‘points in time’. The
payment terms are over the term of the contract.

—

Production income
Production income is recognised on delivery of the related
programme or on a stage of completion basis, depending on
the nature of the contract with the customer. The
performance obligation is satisfied on delivery of the finishedtape to the customer, therefore income is recognised at a‘point in time’. The payment terms are over the term of thecontract.

—

Subscription fees
Subscription fees on pay channel platforms and fromsubscriptions to print and online publications and services arerecognised as earned, pro rata over the subscription period.
The performance obligation is to provide the subscription
service over the period of the contract. This performanceobligation meets the definition of ‘right to access’ as thecustomer simultaneously receives and consumes the benefits
as the Group provides the service. Therefore, subscription fee
income is recognised ‘over time’. Minimum guarantees related
to subscription fee income are recognised pro-rata straightline over the contract life, in line with ‘over time’ recognition.
The payment terms are quarterly in arrears.

Return to contents—

Advertising income
Advertising income is recognised on transmission or
publication of the advertisement. The performance obligation
is satisfied at this ‘point in time’ – when each advertisement
occurs. The payment terms are over the term of the contract.

—

Consumer products
Income generated from the sale of consumer products is
recognised at the time of delivery. Income from the sale ofgoods is stated net of deductions for actual and expected
returns based on management judgement and historicalexperience. The performance obligation is delivery of the
products, and therefore income is recognised at a ‘point intime’. The payment terms are over the term of the contract.

—

Royalties
Royalty income arising from sales and usage-based royalties
are recognised at the later of when the subsequent sales or
usage occurs, or the performance obligation has beensatisfied. Minimum guarantees related to royalty income arerecognised on delivery of the completed content to thecustomer, with any subsequent royalties recognised as earnt.
Therefore, royalty income is recognised at a ‘point in time’. The
payment terms are over the term of the contract.

Other income— Grant income
Grants from Government departments are recognised asincome in the financial year that they relate to. Grants fromother public bodies are recognised as income consistently withthe related costs, provided that there is reasonable assurance
that the BBC will comply with any conditions attached to the
grant and that the grant will be received.
—

Rental income
Rental income is recognised on a straight-line basis over theterm of the lease.

Use of estimates and judgements – income recognition
The largest income stream for the BBC is licence fee income;received from DCMS. This also gives rise to the largest receivableto the BBC, which is calculated based upon the value of licences
issued in the year, less a deduction for refunds and cancellations.
The expected credit loss in relation to this balance is not material,
and takes into the account the creditworthiness of DCMS. Income
recognition in the BBC’s commercial operations is complex
however, with a number of different income streams including saleof content to global broadcasters, subscription income and income
from the sale of consumer products. The complexity of individual
contractual terms may require the BBC to make judgements inassessing when the criteria for recognising income have beensatisfied, particularly whether the BBC has sufficiently fulfilled its
obligations under the contract to allow income to be recognised.
Costs of obtaining long-term contracts and costs of fulfilling
contracts
The costs of fulfilling contracts do not result in the recognition of aseparate asset because:—such costs are included in the carrying amount of inventory forcontracts involving the sale of goods; and—for service contracts, income is recognised over time byreference to the stage of completion, meaning that control of
the asset is transferred to the customer on a continuing basis
as work is carried out. Consequently, no asset for work inprogress is recognised.

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N O T E S T O T H E AC C O U N T S

H. Basis of preparation of the financial statements and otheraccounting policies continued
The group has taken advantage of the practical exemptions:——

not to account for significant financing components where thetime difference between receiving consideration andtransferring control of goods (or services) to its customer is
one year or less; andexpense the incremental costs of obtaining a contract when
the amortisation period of the asset otherwise recognised
would have been one year or less.

Accounting policies relevant to section B
Completed originated programmes, programmes in production
and prepayments to acquire future programme-related rights
Programme assets reported as inventory effectively represent theBBC’s right to broadcast. The BBC’s right to sell programme rights
are, however, recognised within intangible assets.
Completed originated programmes and programmes in production
are held at cost.
Cost includes all direct costs, production overheads and a
proportion of other attributable overheads. The proportion ofprogrammes necessarily taking a substantial period of time to
produce is small and, as such, no borrowing costs are included
in cost.
Where, exceptionally, it becomes certain that a programme isunable to be broadcast, the full value of the programme is written
off to the income statement.
Programme development costs are expensed to the income
statement until such time as there is a strong indication that thedevelopment work will result in a commissioned programme1, when
any further costs are recognised as programme-related assets.
Originated programmes that are still in production at the balance
sheet date are recognised as programmes in production, exceptthat prepayments to acquire future programme-related rights areshown separately where the BBC has made payments to
independent producers, or the holders of certain rights (forexample, rights to broadcast sporting events), to receive theprogramme on completion.
Rights to broadcast acquired programmes and films
The rights to broadcast acquired programmes and films arerecognised at cost. The costs of acquired programmes and films
are expensed on first transmission except to the extent that the
number of further showings are contractually agreed, when they
are expensed according to the expected transmission profile.
Assets and liabilities relating to acquired programmes arerecognised at the point of payment or commencement of thelicence period, whichever is earlier. Agreements for the futurepurchase of rights whose licence period has not commenced andwhere there has been no payment by the balance sheet date aredisclosed as purchase commitments.
Where the BBC has invested in independent productions, inaddition to broadcasting rights, the BBC may obtain rights tofuture royalties from the sale of rights associated with the
production. These residual interests are recognised initially at costsubject to amortisation as royalties are received and impaired if
anticipated royalties do not materialise.

Accounting policies relevant to section C
Other employee benefits
Other short and long-term employee benefits, including holiday
pay and long service leave, are recognised as an expense over theperiod in which they accrue.
Termination benefits
Termination benefits are expensed at the earlier of when the BBC
can no longer withdraw the offer of those benefits and when the
BBC recognises costs for a restructure.
Defined contribution plans
The amounts charged as expenditure for the defined contributionplans represent the contributions payable by the BBC for theaccounting period.
Defined benefit plans
The defined benefit plans, of which the majority of staff are
members, provide benefits based on pensionable pay. The assetsof the BBC’s Pension Scheme are held separately from those of
the BBC.
Pension scheme assets are measured at fair value. Pension scheme
liabilities are measured using the projected unit credit method. The
present value of scheme liabilities is calculated by discounting
estimated future cash outflows at the current rate of return on ahigh-quality corporate bond of equivalent term and currency tothe liabilities.
Remeasurement comprising gains and losses and the return on
scheme assets (excluding interest) are recognised immediately inthe balance sheet with a charge or credit to the statement ofcomprehensive income in the period in which they occur.
Remeasurement recorded in the statement of comprehensive
income is not recycled. When the benefits of a plan are changed
the resulting change in benefit that relates to past service isrecognised immediately in the income statement. Net interest is
calculated by applying a discount rate to the net defined benefit
liability or asset. Defined benefit costs are split into three
categories:—

current service cost, past-service cost and gains and losses on
settlements and curtailments;—

net interest expense or income; and—remeasurement.

The current service cost and past-service cost are included within
operating costs in the consolidated income statement.
Curtailments gains and losses are accounted for as past-service
cost. Net interest expense or income relating to the funded defined
benefit pension plans is included within ‘finance income’ or ‘financecosts’, as relevant, in the consolidated income statement.
Administration costs directly related to the management of plan
assets are deducted from the return on plan assets, which arerecorded as remeasurements in the statement of comprehensive
income. Other administrative scheme expenses associated withrunning the scheme are recorded within operating expenses whenincurred.
The retirement benefit obligation recognised in the consolidatedbalance sheet represents the deficit or surplus in the BBC’s defined
benefit schemes. Any surplus resulting from this calculation islimited to the present value of any economic benefits available in
the form of refunds from the schemes or reductions in futurecontributions to the schemes.

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

H. Basis of preparation of the financial statements and otheraccounting policies continued
Use of estimates and judgements – post-retirement benefits
The pension costs and obligations of the BBC’s defined benefit
schemes are calculated on the basis of a range of assumptions,
including the discount rate, inflation rate, salary growth andmortality. Differences arising as a result of actual experience
differing from the assumptions, or future changes in theassumptions, will be reflected in subsequent periods. A smallchange in assumptions can have a significant impact on thevaluation of the liabilities. Further analysis on the sensitivity ofpension assumptions is given in note C7.1.
Accounting policies relevant to section D
Owned assets
Other than as noted below, items of property, plant and equipment
are stated at cost less accumulated depreciation and any
accumulated impairment losses.
Cost includes expenditure that is directly attributable to theacquisition of the asset.
Leased assets
Assets held under finance leases are capitalised within property,
plant and equipment and depreciation is provided as appropriate.
On initial recognition the asset is measured at the lower of its fairvalue and the present value of the minimum lease payments.
Depreciation
Depreciation is provided to write off the cost of each item ofproperty, plant and equipment, less its estimated residual value, on
a straight-line basis over its estimated useful life. The major
categories of property, plant and equipment are depreciated asfollows:—

Land and buildings
Freehold land – not depreciatedFreehold buildings – 50 years
Freehold building improvements – 10 to 50 years
Leasehold buildings – shorter of 50 years or life of lease
Leasehold building improvements – shorter of 50 years or lifeof lease

Investment properties
Investment properties are initially recognised at cost andsubsequently carried at cost less accumulated depreciation andaccumulated impairment losses. Depreciation is calculated using astraight-line method to allocate the depreciable amounts over theestimated useful lives of the properties (see depreciation on landand buildings above). The residual values, useful lives anddepreciation method of investment properties are reviewed, andadjusted as appropriate, at each balance sheet date. The effects ofany revision are included in the profit and loss when the changes
arise.
Lease payments
Payments made under operating leases are recognised in theincome statement on a straight-line basis over the lease term.
Payments made under finance leases are apportioned between
financing costs and the reduction of the outstanding liability. The
financing costs are allocated to each period so as to produce a
constant periodic rate of interest on the remaining balance of theliability.
Use of estimates and judgements – leases
The determination of whether an arrangement is, or contains, alease, is based on the substance of the arrangement and requires
an assessment of whether the fulfilment of the arrangement isdependent on the use of a specific asset or assets and whether thearrangement conveys the right to use the asset.
In assessing whether a lease is an operating lease or a financelease, judgement needs to be exercised in determining whether or
not substantially all the risks and rewards of ownership of theleased asset are held by the BBC. Given that finance leases arerecognised as liabilities, and operating leases are not, this can havea significant effect on the reported financial position of the BBC.
Another key judgement is the determination of thecommencement date of a lease.
When determining the accounting for a finance lease, the BBC has
assessed whether it has the right to use the leased asset at the
inception1 of the lease, or whether this right passes at a later date(‘the commencement date’).

—Plant and machinery
Computer equipment – 3 to 5 years
Electrical and mechanical infrastructure – 10 to 25 years
Other – 3 to 10 years

Where a significant site is being redeveloped, occupation may
occur in distinct phases; consequently, the leased asset andliabilities are recognised based on the proportion of the site
occupied at each commencement date.

—

Furniture and fittings – 3 to 10 years
Depreciation methods, estimated useful lives and residual
values are reviewed at each reporting date.

—

Use of estimates and judgements – capital projects
The BBC is completing a number of significant capital projects
for which amounts have been capitalised on the BBC’s balance
sheet. The most critical estimates that the capitalised values
are based upon is the recoverability of these assets,
dependent on the achievement of project completion, and theassets being used in the manner intended as part of theoriginal business case.

Accounting policies relevant to section E
Programme-related intangible assets
The BBC’s right to sell programme rights is recognised within
intangible assets. Programme assets reported as inventory
effectively represent the BBC’s right to broadcast, however.
Programme-related intangible assets, which include programme
rights and residual programme rights, are stated at cost, after
writing off the costs of programmes that are consideredirrecoverable, less accumulated amortisation. The cost andaccumulated amortisation of programme-related intangible assets
are reduced by programmes which are fully written off.

1 See Glossary for further details

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N O T E S T O T H E AC C O U N T S

H. Basis of preparation of the financial statements and otheraccounting policies continued
Research and development expenditure – internally generated
intangible assets
Expenditure on research activities is written off in the income
statement when incurred.
Expenditure on development activities is included on the balance
sheet as an asset only if both of the following conditions are met:—

it is probable that the asset will generate future economic
benefits; and—the development costs of the asset can be measured reliably.

The assets are measured at cost less accumulated amortisation
and any accumulated impairment losses.
For the PSB Group it is generally unlikely that future economic
benefits in the form of cash inflows will be received, and as a result,
other than assets created for use by the business in delivering its
public purposes, development costs are only capitalised by the
BBC Group’s commercial businesses.
Other intangible assets
Other intangible assets acquired separately by the BBC are statedat cost less accumulated amortisation and any accumulated
impairment losses. The identifiable intangible assets acquired aspart of a business combination are shown at fair value at the dateof acquisition (in accordance with IFRS 3 Business Combinations)less accumulated amortisation and any accumulated impairment
losses.
Amortisation1
Amortisation is charged to the income statement on a systematic
basis over the estimated useful lives of intangible assets, from thedate that they are available for use, unless such lives are indefinite.
Amortisation methods, useful lives and residual values arereviewed at each balance sheet date and adjusted if appropriate.
The useful lives and amortisation methods of other classes ofintangible asset are as follows:
UKTV carrier agreement

Straight line

Software
Other

Straight line
Straight line

Unexpired termof agreement
2 – 5 years
3 – 8 years

Amortisation of distribution rights is charged to the income
statement to match the average income profile over its estimatedaverage marketable life.
Impairment1: Non-financial assets
At each balance sheet date, the BBC reviews the carrying amount(net amount held on the balance sheet) of those assets that are
subject to amortisation, to determine whether there is anindication that any of those assets has suffered any impairment
loss. If any such indication exists, the recoverable amount of theasset is estimated in order to determine the extent of any
impairment loss.
For goodwill, the recoverable amount is estimated each year at thesame time.
The recoverable amount of an asset is the higher of fair value lesscosts to sell and value in use. For the purposes of impairment
testing, assets are grouped at the lowest level at which theygenerate separately identifiable cash flows (cash-generating units).
In assessing value in use, the estimated future cash flows are

discounted to their present value using a pre-tax discount rate thatreflects current market assessments of the time value of money
and the risks specific to the asset for which the estimates of future
cash flows have not been adjusted.
An impairment loss is recognised in the income statement for theamount by which the asset’s carrying amount exceeds its
recoverable amount. Where a cash-generating unit is impaired, theimpairment loss will first be allocated to reduce goodwill and thento the other assets of the cash-generating unit on a pro rata basis,
except that the carrying amount of any individual asset will not be
reduced below its separately identifiable recoverable amount.
Impairment losses in respect of goodwill are not reversed. In
respect of assets other than goodwill, an impairment loss isreversed if there has been a change in the estimates used todetermine the recoverable amount. An impairment loss is reversed
only to the extent that the asset’s carrying amount does notexceed the carrying amount that would have been determined, netof depreciation or amortisation, if no impairment loss has beenrecognised.
Goodwill
Goodwill is recorded in the balance sheet as the difference
between the fair value of the consideration transferred by the BBC
and the recognised amount of non-controlling interests in theacquire compared to the fair value of the identifiable assets andliabilities acquired. These are all measured at the date ofacquisition. Where the consideration is less than the net assets
acquired, the difference is recognised immediately in the income
statement.
Acquisitions prior to 1 April 2007 – as part of the adoption of IFRS,
in accordance with IFRS 1 First-time adoption of IFRS, the Groupelected to restate only those business combinations that occurredon or after 1 April 2007. In respect of acquisitions prior to 1 April
2007, goodwill is recognised at deemed cost, being the amountpreviously recognised under UK accounting standards, subject tobeing tested for impairment at that date. Goodwill arising inperiods up to 1 April 1998 remains offset against the operating
reserve, as was permitted by UK GAAP at the time.
Goodwill arising on the acquisition of associates and joint ventures
is included in the carrying amount of the associate or joint venture
and is tested for impairment as part of the overall balance.
Subsequent measurement of separately recognised goodwill –goodwill is tested annually for impairment and is measured at costless any accumulated impairment losses. For the purposes of
impairment testing the goodwill is allocated to cash-generating
units on the basis of those expected to benefit from the relevantbusiness combination.
Use of estimates and judgements – impairment of goodwill
The determination of whether goodwill is impaired requires anestimation of the value in use of the cash-generating units. The
value in use calculation requires the entity to estimate the future
cash flows expected to arise from the cash-generating unit and asuitable discount rate that reflects current market assessments of
the risks specific to the asset and the time value of money, in orderto calculate present value. The estimation process is complex due
to the inherent risks and uncertainties associated with long-term
forecasting. If different estimates of the projected future cash
flows or a different selection of an appropriate discount rate or
long-term growth rate were made, these changes could materiallyalter the projected value of the cash flows of the asset, and as aconsequence materially different amounts would be reported in
the financial statements.

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

H. Basis of preparation of the financial statements and otheraccounting policies continued
Accounting policies relevant to section F
Trade and other payables
Trade and other payables are recognised initially at fair value andsubsequently measured at amortised cost using the effective
interest method1.
Borrowing costs
Borrowing costs directly attributable to the acquisition,
construction or production of qualifying assets (those necessarily
taking a substantial period of time to get ready for their intendeduse) are added to the cost of those assets, until such time as theassets are ready for their intended use.
Originated programmes can be qualifying assets, but thosenecessarily taking a substantial period of time to get ready forbroadcast are a small proportion of overall programme
investment. Any borrowing costs that could be attributed to those
programmes are not significant and, therefore, no borrowing costs
are capitalised.
All finance income and other borrowing costs are recognised inincome and expense in the period in which they are incurred.
Use of estimates and judgements – provisions
Judgements are employed in determining if a past event has givenrise to a present obligation that will result in probable payment by
the BBC that can be measured reliably. Estimation techniques areused, following the review of such events, if it is determined that aprovision is required. Such techniques are used in the calculation of
the best estimate of the amount required to settle obligations,
including determining how likely it is that expenditure will be
required by the BBC. This can be very complex, especially when
there is a wide range of possible outcomes. The BBC recognises
decommissioning liabilities as part of the initial cost of the asset,
discounted to present value. The BBC reassesses whether there
has been a change in this liability based on the facts andcircumstances at each balance sheet date.
Any provisions that are payable over a number of years (other thandeferred tax) are discounted to net present value at the balance
sheet date using a discount rate appropriate to the particularprovision concerned.
Accounting policies relevant to section G
Taxation
The tax charge for the period comprises both tax currently payableand deferred tax. Taxation is recognised in the income statement
except to the extent that it relates to items recognised directly inreserves, in which case it is recognised in reserves.
Current tax is the expected tax payable for the year, using tax rates
that are enacted or substantively enacted at the balance sheet
date, and any adjustment to tax payable in respect of previous
years. In respect of tax currently payable:——

the PSB Group is not liable to corporation tax on any surplus
licence fee income or grants received from Government
departments; however, it is fully liable for corporation tax on
capital gains and on all its other external income. Expenditureon capital assets is not eligible for capital allowances giving
rise to temporary differences that would lead to deferred tax
assets or liabilities. Movements of fair value adjustments in
the income statement give rise to deferred tax balances.
the BBC’s commercial subsidiaries are liable for corporation
tax based on taxable profit for the year.

Current tax assets and current tax liabilities are offset if, and only
if, there is a legally enforceable right to offset the recognised
amounts; and the entity intends either to settle on a net basis, orto realise the asset and settle the liability simultaneously.
Deferred tax is provided using the balance sheet liability method
on any temporary differences between the carrying amounts ofassets and liabilities for financial reporting purposes and theamounts used for taxation purposes. The amount of deferred tax
provided is based on the tax rates expected to apply in the period
when the liability is settled or the asset is realised using tax rates
enacted or substantively enacted at the balance sheet date.
Deferred tax assets and deferred tax liabilities are offset only
where there is a legally enforceable right to set off current tax
assets against current tax liabilities; and the deferred tax assets
and the deferred tax liabilities relate to income taxes levied by thesame taxation authority on either:—

the same taxable entity; or—different taxable entities which intend either to settle current
tax liabilities and assets on a net basis, or to realise the assets
and settle the liabilities simultaneously, in each future period
in which significant amounts of deferred tax liabilities orassets are expected to be settled or recovered.

Financial instruments
The BBC classifies its financial assets and liabilities into one of thecategories discussed below, depending on the purpose for which
the asset was acquired. Other than financial instruments in aqualifying hedging relationship, the BBC’s accounting policy foreach category is as follows:
Amortised cost
The BBC’s financial assets measured at amortised cost comprisetrade and other receivables, contract assets, cash and cash
equivalents and borrowings. The BBC’s financial liabilities
measured at amortised cost comprise trade and other payables,
contract liabilities and borrowings. They principally arise from theprovision of goods and services, but also incorporate other types offinancial assets/liabilities where the objective is to collect orreceive contractual cash flows and the contractual cash flows aresolely payments of principal and interest.
Trade and other receivables and contract assets
Trade and other receivables and contract assets are recognised
initially at fair value and subsequently at amounts considered
recoverable (amortised cost). Estimates are used in determining
the level of receivables that will not be collected. These estimates
include factors such as historical experience, the current state of
the UK and overseas economies and industry specifics. A provision
for impairment of trade and other receivables and contract assets
is recognised based on the simplified approach using the lifetime
expected credit losses. During this process the probability of
non-payment is assessed. This probability is then multiplied by theamount of the expected loss arising from default to determine thelifetime expected credit loss for the trade and other receivables
and contract assets.
The most significant trade and other receivable is the licence fee
receivable, which represents amounts due from the DCMS for
licence fee payments not yet collected but due. The calculation ofthis balance carries a degree of estimation (see page 249), however
the expected credit loss is not material, reflecting the credit risk of
DCMS.
Changes in the carrying amount of the allowance are recognised in
the income statement within total operating costs.

1 See Glossary for further details

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N O T E S T O T H E AC C O U N T S

H. Basis of preparation of the financial statements and otheraccounting policies continued
Contract liabilities
A contract liability is recognised when payment is received prior to
the associated performance obligation being fulfilled. It is released
to revenue when the performance obligation is satisfied.

Other investments
The BBC has strategic investments in listed and unlisted entities
which are not accounted for as subsidiaries, associates or joint
ventures. These investments were previously classed as available
for sale under IAS 39, and are now held at fair value throughsurplus/deficit.

Cash and cash equivalents
Cash and cash equivalents comprise cash balances and calldeposits with maturities of less than three months (short-term
deposits). Cash and cash equivalents also include licence fee funds
collected on behalf of HM Treasury, which are excluded from theGroup’s net funds and in respect of which a separate creditor isrecognised.

Fair value through other comprehensive income
Certain derivatives designated as cash flow hedges are recognised
at fair value through other comprehensive income. See hedge
accounting below for further details.

Fair value through surplus/deficit
This category comprises derivatives. Those in-the-money
derivatives are financial assets whilst those out-the-money arefinancial liabilities.
The BBC does not enter into speculative derivative contracts;
however, some derivative financial instruments are used to manage
the BBC’s exposure to fluctuations in interest rates (interest rate
swaps1, caps1 and collars1) and foreign currency exchange rates(foreign currency forward contracts and currency options).
Derivative financial instruments, excluding derivatives held as
qualifying hedges, are initially recognised at fair value and aresubsequently remeasured to fair value at the balance sheet datewith movements recorded in the income statement.
Interest rate swaps, caps and collars
The fair value is the estimated amount that the BBC would receiveor pay to terminate the swap, cap or collar at the balance sheet
date, taking into account current interest rates, the current
creditworthiness of swap, cap or collar counterparties and thecreditworthiness of the BBC.
Foreign currency forward contract rates
The fair value of foreign currency forward contract rates isdetermined using forward exchange rates at the balance sheet
date.
Embedded derivatives
An embedded derivative is a component of a hybrid contract that
also includes a non-derivative host – with the effect that some of
the cash flows of the combined instrument vary in a way similar toa stand-alone derivative.
Derivatives embedded in hybrid contracts with a financial asset
host within the scope of IFRS 9 are not separated. The entire hybrid
contract is classified and subsequently measured as either
amortised cost or fair value as appropriate.
Derivatives embedded in hybrid contracts with hosts that are notfinancial assets within the scope of IFRS 9 (e.g. financial liabilities)
are treated as separate derivatives when they meet the definitionof a derivative, their risks and characteristics are not closely related
to those of the host contracts and the host contracts are notmeasured at fair value through surplus/deficit.
If the hybrid contract is a quoted financial liability, instead of
separating the embedded derivatives, the BBC generally
designates the whole hybrid contract at fair value through surplus/
deficit.

Hedge accounting
Where hedge accounting is applied, the BBC has elected to adopt
the hedge accounting requirements of IFRS 9 Financial Instruments.
The BBC enters into hedge relationships where the critical terms of
the hedging instruments and the hedged item match. Hedge
effectiveness is determined at the origination of the hedging
relationship. Quantitative effectiveness tests are performed ateach period end to determine the continuing effectiveness of therelationship. In instances where changes occur to the hedged item
which results in the critical terms no longer matching, thehypothetical derivative method is used to assess effectiveness.
The BBC designates certain derivatives as cash flow hedges by
documenting the relationship between the hedging instrument
and the hedged item, along with the risk management objectives
and its strategy for undertaking various hedge transactions. Where
the hedge is deemed to have been effective, the effective portionof any changes in the fair value of the derivatives that aredesignated in the hedge are recognised in other comprehensive
income. The accumulated amount in the cash flow hedge reserve isreclassified to profit or loss in the same period as the hedged cash
flows affect profit or loss. Any ineffective portion of the hedge isrecognised immediately in the income statement.
Use of estimates and judgements – impairment of financial assets
Financial assets are assessed at each balance sheet date todetermine whether there is any objective evidence of impairment.
Judgement is required when considering the factors in determining
whether there is objective evidence of impairment; which include
significant financial difficulty of the counterparty and breach ofcontract. Individually significant financial assets are tested for
impairment on an individual basis. The remaining financial assets
are assessed collectively in groups that share similar credit risk
characteristics. The amount of the loss is measured as thedifference between the asset’s carrying amount and the present
value of estimated future cash flows discounted at the financial
asset’s original effective interest rate. All impairment losses arerecognised in the income statement.
Reserves
The operating reserve is the accumulated surplus/deficit to date.
The hedging reserve is used to record the effective portion of the
cumulative net change in the fair value of cash flow hedging
instruments related to hedged transactions that have not yet
occurred (net of tax).
The translation reserve is used to record exchange differences
arising from the retranslation of the net assets and results ofoverseas subsidiaries.
The other reserve includes fair value gains and losses on financial
assets recognised through other comprehensive income and thefair value of put option liabilities arising on acquisition ofsubsidiaries.

1 See Glossary for further details

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F I N A N C I A L S TAT E M E N T S

H. Basis of preparation of the financial statements and otheraccounting policies continued
New standards and interpretations not yet adopted
At the date of authorisation of these financial statements, thefollowing standards and interpretations, which have not been
applied in these financial statements, were in issue but not yet
effective (and in some cases had not yet been adopted by the EU):

When valuing a lease, future payments are discounted to present
value to evaluate the book value of liabilities. In order to determine
the appropriate discount rate to use, the BBC applies anincremental borrowing rate where the rate implicit in the lease is
not available. Where the asset has an underlying value of morethan £1 million, a rate is calculated according to the specific detailsof the relevant contract, taking into account factors such as leaseterm and lease currency. For leases of assets valued at less than £1
million, the revolving credit facility rate is used.

—

IFRS 16 Leases;—

IFRIC 23 Uncertainty over Income Tax Treatments;—

Amendments to IFRS 9 (Oct 2017) Prepayment Features with
Negative Compensation;—

Amendments to IAS 28 (Oct 2017) Long-term Interests in
Associates and Joint Ventures;

The BBC determines the lease term applicable for IFRS 16(including purchase options and extension/termination options)according to its enforceable rights and obligations under thecontract. For example, where a contract allows either party toterminate with no more than an insignificant penalty, thattermination option is reflected in the lease term.

—

Annual Improvements to IFRS Standards 2015-2017 Cycle(Dec 2017);

The Group has elected to adopt the following practical expedientson transition:—

Amendments to IAS 19 (Feb 2018) Plan Amendment,
Curtailment or Settlement;—

not to capitalise a right-of-use lease asset or related leaseliability where the lease expires before 31 March 2020;—

IFRS 17 Insurance Contracts; and—to use hindsight in determining the lease term;—

Amendments to IFRS 10 and IAS 28 (Sept 2014) Sale orContribution of Assets between an Investor and its Associateor Joint Venture.

—

to exclude initial direct costs from the measurement of theright-of-use asset; and—to apply the portfolio approach where a group of leases has
similar characteristics.

The directors do not expect that the adoption of the standards andinterpretations above would have a material impact on the financial
statements of the Group in future periods, except for IFRS 16.
IFRS 16 Leases (date of adoption: 1 April 2019) replaces IAS 17
Leases. IFRS 16 impacts the accounting for lessees. For applicable
lease agreements IFRS 16 requires the recognition of lease assets
and lease liabilities, representing the right to use the leased item
and the respective future lease payments. The rental expense on
operating leases previously recognised within the income
statement is replaced by a depreciation charge and a financecharge. This will apply to all relevant leases unless the term is lessthan 12 months or the underlying asset has a low value. The BBC
has chosen not to apply IFRS 16 to intangible assets.
The BBC has chosen to adopt IFRS 16 on a cumulative catch-up
basis and therefore the cumulative impact on previous years’
results will be recognised within equity at the beginning of theperiod. As at 1 April 2019 a right of use asset and lease liability will
be recognised for all relevant leases not previously recognised as
finance leases for accounting purposes under IAS 17. These reflect
the right to use leased assets and the future lease payments
respectively. The initial value of the right of use asset will consist of
the present value of the minimum lease payments adjusted for any
lease payments made prior to the commencement of the lease, anylease incentives received less accruals and prepayments associatedwith the lease. Leases previously recognised as finance leases
under IAS 17 will be transitioned into the first IFRS 16 reporting
period at carrying value and remeasured to bring the cumulative
impact of any rent reviews based on an index or rate and theassessment of purchase options onto the balance sheet.

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Lessor accounting, relating to the BBC’s investment property
portfolio, is similar to IAS 17 with the exception of intermediate
sublease arrangements. The review performed over thesecontracts, however, has led the BBC to conclude that one property
should no longer be classified as an investment property but held
as a lease receivable. A reclassification will therefore be performedon adoption of IFRS 16 with the net brought-forward impact
recognised through reserves. No further material impacts are
expected.
Based on the information currently available, on adoption of IFRS
16 on 1 April 2019, non-current assets are expected to increase byc.£1,300 million, liabilities increase by c.£1,220 million andoperating reserves increase by c.£80 million. Assuming the BBC’s
leases in operation remain unchanged during 2020, income frominvestment properties is expected to reduce by c.£17 million,
operating expenditure is expected to reduce by c.£31 million andnet financing costs are expected to increase by c.£18 million,
resulting in an overall net deficit impact of £4 million for the BBC.
The adoption of IFRS 16 will see a c.£20 million improvement incash flow generated from operating activities, offset by acorresponding decline in cash flow from financing activities. Thereis, however, no overall cash flow impact from the adoption of the
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G L O S S A RY

Glossary
The table below explains the financial terms used within the financial statements:
Term

Note

Definition

Amortisation

H

Amortisation is the reduction reflected in the carrying value of the asset as a consequence ofthe regular use of that asset by the organisation.

Associate

E3

An associate is an entity that the BBC has significant influence over, but that does not meet thedefinition of a joint venture or subsidiary. Significant influence is the power to participate in thefinancial and operating decisions of an entity but is not control or joint control over thosepolicies.

BBC’s Television Licence Fee
Trust Statement

A set of financial statements containing an annual report and accounts on income from licencefee customers. The document also contains reports by the National Audit Office who haveaudited the financial statements and the processes for collecting the licence fee.

Cash flow swaps

G3.2

The BBC’s cash flow swaps exchange a series of variable cash flows for a series of fixed cash
flows.

Cash-generating units

E2

Cash-generating units are the smallest group of assets that can independently generate cash
flows.

Changes in demographic andfinancial assumptions

G2.1

Changes in demographic and financial assumptions represent the changes in estimates used tovalue the future liability. Demographic assumptions include mortality rates, staff turnover andearly retirement. Financial assumptions encompass items such as discount rate and futuresalary levels.

Commissioned programme

H

A commissioned programme is where an agreement has been made for the programme to be
produced for broadcast.

Credit risk

G3.1

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial
instrument fails to meet its contractual obligation.

Current service cost

C6.2

The current service cost is the underlying cost to the BBC of pension rights earned by
employees during the year.

Deferred tax

G1.1

Deferred tax is the amount of income tax payable or recoverable in future periods in respect oftaxable or deductible temporary differences, the carry forward of unused losses, and/or the
carry forward of unused tax credits. Temporary differences are differences between the carrying
amount of an asset or liability in the statement of financial position and its tax base, where thetax base of an asset or liability is the amount attributed to that asset or liability for tax
purposes.

Derivative

G3.2

A derivative is an asset or liability that is dependent on, or derives its value from, another asset
or liability and is to be settled in the future.

Discount rate

G2.5

The discount rate for the IAS 19 valuation has been derived with reference to market yields atthe end of the reporting period on AA-rated sterling-denominated corporate bonds withmaturities consistent with the estimated term of the post-employment benefit obligations.
Certain types of bonds are excluded from the calculating model, either because they haveunusual features, are relatively small or potential outliers, in order to remove the distortion thatmight otherwise occur from including unusual, less liquid or potentially misrated bonds.
Extrapolation is performed when the profile of the scheme’s expected benefit outflow is longer
than the cash flows of the available bonds.

Effective interest rateH

An effective interest rate is the rate used to discount future cash flows over the life of thecontract back to present value.

Fair value

D, G

The fair value of an asset is the amount for which the asset could be exchanged between
knowledgeable, willing parties in an arm’s length transaction.

Finance lease

F4.3

A finance lease is a lease where the lessee has substantially taken on the risks and rewards ofownership and operating the asset. As such, both the asset and future liability are recognisedon the balance sheet.

Foreign currency transactions G3.1

As these financial statements are prepared in sterling, the BBC’s foreign currency transactions
and balances must be translated at appropriate exchange rates, into sterling. This means thatvariations in exchange rates can cause the valuation of investments to fluctuate, even when
there has been no change in the health of the underlying business.

Forward foreign currency
contracts

G3.2

Under forward exchange contracts you buy or sell a currency at a fixed exchange rate withdelivery made on a given date or dates in the future.

Going concern

H

The directors are required to make a statement that the BBC is a going concern, which means it
can meet its debts and continue trading for a period of at least 12 months from the date on
which these financial statements were signed.

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F I N A N C I A L S TAT E M E N T S

Term

Note

Definition

Goodwill

E2

Goodwill is the difference between the monetary value paid for a business and the fair value of
its net assets. It represents the premium the purchaser is prepared to pay for the business.
Where the BBC does not own an entity outright, the other shareholders are known/disclosed as
non-controlling interests.

IAS 19 valuation

C7.1

The IAS 19 valuation takes assets at their market value and discounts the accrued liabilities byreference to the discount rate of an AA-rated corporate.

Impairment

H

An impairment occurs when the carrying value of an asset is higher than the amount that isrecoverable from its use or sale.

Inception

H

Inception is the point at which a contract is confirmed; this is normally the point at which thecontract is signed.

Interest cost on pension plan
liabilities

F11

The interest cost on pension plan liabilities represents the increase during the year in the valueof the plan liabilities because the benefits are one year closer to settlement.

Interest rate caps

G3.1

Interest rate caps protect against interest rates rising, by setting an upper limit (cap) on the
floating interest rate, whilst still allowing the benefit of falling interest rates.

Interest rate collars

G3.1Interest rate collars are the same as interest rate caps except that there is also a lower limit set
to the floating interest rate.

Interest rate swaps

G3.1

Interest rate swaps effectively swap a floating rate loan into a fixed rate loan, or vice versa.

Joint venture

E3

A joint venture is where the BBC has joint control over an entity with another partner(s).

Maturity

G2.6

The maturity of a scheme provides an indication of the cash requirements of the scheme andthe likely attitude of the Trustees to risk within their investment policy. The more mature ascheme, the more likely that Trustees will favour low-risk investments.

Net finance income/(cost)

C6.2

Net finance income/(cost) is the difference between the expected return on assets and theinterest liabilities.

Operating lease

F4.4

An operating lease is a lease where the lessee has not taken on the risks and rewards of owningand operating the asset. The lessee (the BBC) is hiring rather than buying an asset.

Past service cost

C6.2

The past service charges arise from changes to the terms and conditions relating to members’
defined retirement benefits, resulting in a credit for years of service already given.

Pension scheme

C6

On retirement, members of the BBC’s defined benefit pension scheme are paid their pensions
from a fund which is kept separate from the Group, to which the BBC makes cash contributions.

Plan liability

G2.1

The plan liability represents the expected amount of money that will be needed in the future to
pay employees for their current and future service to the company.

Programme rights

E1

Programme rights are rights held by the BBC that permit a future transmission of a particular
programme or event.

Public services

F3

Public services in this context represent the PSB Group.

Put option

G3.2

A put option issued by the BBC provides the holder the rights, but not the obligation, to require
the BBC to buy shares at a future date and price determined by the option agreement.

Related parties

C5

Related parties include key management personnel, their immediate families and external
entities controlled by them.

Remeasurement gains andlossesG2.4

These gains and losses arise from actual performance being different from that predicted. Only
defined benefit schemes give rise to gains and losses in the statement of comprehensive
income/(loss).

Remeasurements

C6.2

Remeasurements which arise from actual performance being different from that predicted giverise to gains and losses in the statement of comprehensive income.

Remeasurements on plan
assets

G2.2

Remeasurements on plan assets represent the amount by which the assets held by the scheme(such as equities, bonds and property) have performed better or worse than the expected prioryear value.

Research costs

B1

Research costs are incurred to explore ideas for new programmes or assets, such as the BBC
iPlayer. Research costs are where the ideas are generated, some of which are then developed
further into a plan or design where the costs are then categorised as development.

Subsidiary undertaking

G6.3

A subsidiary undertaking is an entity that is directly or indirectly controlled by the BBC. Control
exists where the BBC has the power to govern the financial and operating policies of the entity
so as to obtain benefits from its activities. In assessing control, potential voting rights that are
currently exercisable or convertible are taken into account.

Return to contents

BBC Group Annual Report and Accounts 2018/19

257

E Q UA L I T Y I N F O R M AT I O N R E P O R T

Equality
Information
Reportp.281
Freelance Equality Information

p.259
Staff Equality Information

Our annual Equality Information Report provides an
update on the progress we have made in relation toequality, diversity and inclusion for our workforce.

258

BBC Group Annual Report and Accounts 2018/19

Return to contents

A D D I T I O N A L I N F O R M AT I O N

Staff(reporting is shown separately for our staff and freelancers)
All staff and leadership: 31 March 2019
Workforce

31 March 20192020 Target

Women (all staff)
Women (Leadership – Bands E+)

47.9%
43.8%

50%
50%

Disability (all staff)
Disability (Leadership – Bands E+)

10.2%
8.7%

8%
8%

BAME (all staff)
BAME (Leadership – Bands E+)

15.3%
11.5%

15%
15%

LGBT (all staff)
LGBT (Leadership – Bands E+)

10.8%
11.4%

8%
8%

Age
All staff age distribution by division: 31 March 2019
Age band (numbers)
Division

Age band (%)

Total

<20

20-29

30-39

40-49

50-59

60+

<20

20-29

30-39

40-49

50-59

60+

Content
871
Corporate, Policy& External Affairs
215
Deputy DirectorGeneral Group
5,640
Nations andRegions
6,051
News and Current
Affairs
3,254
Radio and
Education
1,933

*

150

280

305

115

21

*

17.2

32.2

35.0

13.2

2.4

*

50

67

58

30

10

*

23.2

31.2

27.0

14.0

4.6

56

1,156

1,731

1,482

1,004

211

1.0

20.5

30.7

26.3

17.8

3.7

*

665

1,445

1,876

1,632

430

*

11.0

23.9

31.0

27.0

7.1

*

348

866

925

936

178

*

10.7

26.6

28.4

28.8

5.5

*

306

551

503

452

120

*

15.8

28.5

26.0

23.4

6.2

UK Public
Service

17,964

61

2,675

4,940

5,149

4,169

970

0.3

14.9

27.5

28.7

23.2

5.4

World Service
Group
BBC Studios
Other

1,472
2,127
264

*
*
*

152
472
51

498
687
75

452
608
62

295
313
66

75
46
10

*
*
*

10.3
22.2
19.3

33.8
32.3
28.4

30.7
28.6
23.5

20.1
14.7
25.0

5.1
2.2
3.8

Grand Total

21,827

62

3,350

6,200

6,271

4,843

1,101

0.3

15.4

28.4

28.7

22.2

5.0

Leadership staff age distribution by division: 31 March 2019
Age band (numbers)

Age band (%)

Division

Total

<20

20-29

30-39

40-49

50-59

60+

<20

20-29

30-39

40-49

50-59

60+

Content
Corporate, Policy& External Affairs
Deputy DirectorGeneral Group
Nations andRegions
News and Current
Affairs
Radio and
Education

198

*

*

31

107

53

*

*

*

15.7

54.0

26.8

*

69

*

*

19

25

17

*

*

*

27.6

36.2

24.6

*

1,042

*

*

263

419

308

46

*

*

25.2

40.2

29.6

4.4

680

*

*

74

274

278

53

*

*

10.9

40.3

40.9

7.8

591

*

*

74

215

257

44

*

*

12.5

36.4

43.5

7.4

239

*

*

39

105

75

20

*

*

16.3

43.9

31.4

8.4

2,819

*

*

500

1,145

988

177

*

*

17.7

40.6

35.1

6.3

World Service
Group
BBC Studios
Other

200
541
17

*
*
*

*
17
*

25
134
*

81
239
*

78
134
*

14
17
*

*
*
*

*
3.1
*

12.5
24.8
*

40.5
44.2
*

39.0
24.8
*

7.0
3.1
*

Grand Total

3,577

*

28

662

1,470

1,209

208

*

0.8

18.5

41.1

33.8

5.8

UK Public
Service

All staff data reflects UK-based employee contracts only. Leadership is defined as Band E and above. Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

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BBC Group Annual Report and Accounts 2018/19

259

E Q UA L I T Y I N F O R M AT I O N R E P O R T

All staff age distribution by Job Family: 31 March 2019
Age band (numbers)
Job Family

Age band (%)

Total

<20

20-29

30-39

40-49

50-59

60+

<20

20-29

30-39

40-49

50-59

60+

Commissioning
Programming
Sales/Marketing
Support/Admin
Technical/
Engineering
Not Allocated177
10,281
576
3,401

*
*
*
51

*
1,400
157
611

30
2,968
229
918

87
3,164
129
934

46
2,274
51
737

*
472
10
150

*
*
*
1.5

*
13.6
27.3
18.0

16.9
28.9
39.7
27.0

49.2
30.8
22.4
27.4

26.0
22.1
8.9
21.7

*
4.6
1.7
4.4

5,526
1,866

*
*

810
364

1,495
560

1,438
519

1,411
324

371
92

*
*

14.7
19.5

27.1
30.0

26.0
27.8

25.5
17.4

6.7
4.9

Grand Total

21,827

62

3,350

6,200

6,271

4,843

1,101

0.3

15.4

28.4

28.7

22.2

5.0

Leadership staff age distribution by Job Family: 31 March 2019
Age band (numbers)
Job Family

Age band (%)

Total

<20

20-29

30-39

40-49

50-59

60+

<20

20-29

30-39

40-49

50-59

60+

Commissioning
Programming
Sales/Marketing
Support/Admin
Technical/
Engineering
Not Allocated

136
1,683
106
785

*
*
*
*

*
*
*
*

22
208
41
181

71
704
40
301

37
651
21
251

*
113
*
44

*
*
*
*

*
*
*
*

16.2
12.4
38.7
23.1

52.2
41.8
37.7
38.3

27.2
38.7
19.8
32.0

*
6.7
*
5.6

480
387

*
*

*
13

102
108

197
157

165
84

16
25

*
*

*
3.4

21.3
27.9

41.0
40.6

34.4
21.7

3.3
6.4

Grand Total

3,577

*

28

662

1,470

1,209

208

*

0.8

18.5

41.1

33.8

5.8

All staff age distribution by grade bands: 31 March 2019
Age band (numbers)
Grade band

Age band (%)

Total

<20

20-29

30-39

40-49

50-59

60+

<20

20-29

30-39

40-49

50-59

60+

A
B
C
D
E
F
SL
Not Allocated

406
2,431
7,018
6,658
2,094
868
228
2,124

*
*
*
*
*
*
*
58

154
786
1,459
383
15
*
*
553

59
584
2,330
2,092
466
81
10
578

54
496
1,686
2,206
837
389
84
519

83
429
1,221
1,661
659
347
119
324

55
135
320
316
117
51
15
92

*
*
*
*
*
*
*
2.7

38.0
32.3
20.8
5.8
0.7
*
*
26.1

14.5
24.0
33.2
31.4
22.2
9.3
4.4
27.2

13.3
20.4
24.0
33.1
40.0
44.8
36.8
24.4

20.4
17.7
17.4
24.9
31.5
40.0
52.2
15.3

13.6
5.6
4.6
4.8
5.6
5.9
6.6
4.3

Grand Total

21,827

62

3,350

6,200

6,271

4,843

1,101

0.3

15.4

28.4

28.7

22.2

5.0

All staff leaver and joiner distribution by age: 31 March 2019
Age band (numbers)

Age band (%)

Category

Total

<20

20-29

30-39

40-49

50-59

60+

<20

20-29

30-39

40-49

50-59

60+

Leavers
Joiners

3,123
3,649

18
53

1,139
1,731

944
1,080

532
499

337
229

153
57

0.6
1.4

36.5
47.4

30.2
29.6

17.0
13.7

10.8
6.3

4.9
1.6

All staff leaver distribution by age and reason for leaving: 31 March 2019
Age band (numbers)
Reason for leaving

Age band (%)

Total

<20

20-29

30-39

40-49

50-59

60+

<20

20-29

30-39

40-49

50-59

60+

Voluntary
Redundancy
End FTC
Other Involuntary
Other

1,279
301
1,398
78
67

*
*
14
*
*

359
10
750
19
*

491
56
366
30
*

256
86
169
16
*

134
102
69
11
21

35
47
30
*
39

*
*
1.0
*
*

28.1
3.3
53.6
24.4
*

38.4
18.6
26.2
38.4
*

20.0
28.6
12.1
20.5
*

10.5
33.9
4.9
14.1
31.3

2.7
15.6
2.2
*
58.2

Grand Total

3,123

18

1,139

944

532

337

153

0.6

36.5

30.2

17.0

10.8

4.9

All staff internal mover distribution by age: 31 March 2019
Age band (numbers)
Internal move typeAge band (%)

Total

<20

20-29

30-39

40-49

50-59

60+

<20

20-29

30-39

40-49

50-59

60+

Attachment
Promotion
Transfer

1,633
678
1,424

*
*
*

312
240
547

709
256
484

434
138
269

172
42
108

*
*
13

*
*
*

19.1
35.4
38.4

43.4
37.8
34.0

26.6
20.3
18.9

10.5
6.2
7.6

*
*
0.9

Grand Total

3,735

*

1,099

1,449

841

322

21

*

29.4

38.8

22.5

8.6

0.6

260

BBC Group Annual Report and Accounts 2018/19

Return to contents

A D D I T I O N A L I N F O R M AT I O N

All staff age distribution by contract type: 31 March 2019
Age band (numbers)
Contract typeAge band (%)

Total

<20

20-29

30-39

40-49

50-59

60+

<20

20-29

30-39

40-49

50-59

60+

Continuing
19,353Fixed Term lessthan 1 yr
1,858
Fixed Term 1 yr +572
Flexicon
44

34

2,135

5,478

5,969

4,688

1,049

0.2

11.0

28.3

30.9

24.2

5.4

*
19
*

900
301
14

561
153
*

248
46
*

108
39
*

32
14
*

*
3.3
*

48.5
52.6
31.8

30.2
26.8
*

13.3
8.0
*

5.8
6.8
*

1.7
2.5
*

Grand Total

62

3,350

6,200

6,271

4,843

1,101

0.3

15.3

28.4

28.7

22.2

5.1

21,827All staff age distribution by length of service: 31 March 2019
Age band (numbers)
Length of service (yrs)

Age band (%)

Total

<20

20-29

30-39

40-49

50-59

60+

<20

20-29

30-39

40-49

50-59

60+

<1
1-<3
3-<5
5-<10
10+

2,837
3,487
2,251
3,597
9,655

46
16
*
*
*

1,272
1,251
569
256
*

879
1,229
924
1,795
1,373

406
629
486
1,004
3,746

194
303
220
441
3,685

40
59
52
101
849

1.6
0.5
*
*
*

44.9
35.9
25.3
7.1
*

31.0
35.2
41.0
49.9
14.2

14.3
18.0
21.6
27.9
38.8

6.8
8.7
9.8
12.3
38.2

1.4
1.7
2.3
2.8
8.8

Grand Total

21,827

62

3,350

6,200

6,271

4,843

1,101

0.3

15.3

28.4

28.7

22.2

5.1

Disability
All staff disability distribution by division: 31 March 2019
Disability (numbers)
Division

Disability (%)

Total

Disabled

Not disabled

Disabled

Not disabled

Content
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

798
196
5,137
5,632
3,008
1,782

85
26
631
504
291
225

713
170
4,506
5,128
2,717
1,557

10.7
13.3
12.3
8.9
9.7
12.6

89.3
86.7
87.7
91.1
90.3
87.4

UK Public Service

16,553

1,762

14,791

10.6

89.4

World Service GroupBBC Studios
Other

1,321
1,937
241

90
181
20

1,231
1,756
221

6.8
9.3
8.3

93.2
90.7
91.7

20,052

2,053

17,99910.2

89.8

Grand Total

Leadership staff disability distribution by division: 31 March 2019
Disability (numbers)

Disability (%)

Division

Total

Disabled

Not disabled

Disabled

Not disabled

Content
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

176
62
979
646
552
227

16
*
105
46
37
31

160
53
874
600
515
196

9.1
*
10.7
7.1
6.7
13.7

90.9
85.5
89.3
92.9
93.3
86.3

UK Public Service

2,642

244

2,398

9.2

90.8

World Service GroupBBC Studios
Other

183
499
15

13
33
*

170
466
15

7.1
6.6
*

92.9
93.4
100.0

3,339

290

3,049

8.7

91.3

Grand Total

All staff data reflects UK-based employee contracts only.
Leadership is defined as Band E and above.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

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BBC Group Annual Report and Accounts 2018/19

261

E Q UA L I T Y I N F O R M AT I O N R E P O R T

All staff disability distribution by Job Family: 31 March 2019
Disability (numbers)
Job FamilyCommissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not AllocatedGrand Total

Disability (%)

Total

Disabled

Not disabled

Disabled

Not disabled

163
9,537
523
3,129
5,037
1,663

19
900
67
374
576
117

144
8,637
456
2,755
4,461
1,546

11.7
9.4
12.8
12.0
11.4
7.0

88.3
90.6
87.2
88.0
88.6
93.0

20,052

2,053

17,99910.2

89.8

Leadership staff disability distribution by Job Family: 31 March 2019
Disability (numbers)
Job Family

Disability (%)

Total

Disabled

Not disabled

Disabled

Not disabled

Commissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

122
1,578
93
737
456
353

11
127
*
77
48
19

111
1,451
85
660
408
334

9.0
8.0
*
10.4
10.5
5.4

91.0
92.0
91.4
89.6
89.5
94.6

Grand Total

3,339

290

3,049

8.7

91.3

All staff disability distribution by grade bands: 31 March 2019
Disability (numbers)
Grade band

Disability (%)

Total

Disabled

Not disabled

Disabled

Not disabled

A
B
C
D
E
F
SL
Not Allocated

373
2,228
6,432
6,167
1,962
811
213
1,866

42
307
673
607
174
79
19
152

331
1,921
5,759
5,560
1,788
732
194
1,714

11.3
13.8
10.5
9.8
8.9
9.7
8.9
8.1

88.7
86.2
89.5
90.2
91.1
90.3
91.1
91.9

Grand Total

20,052

2,053

17,99910.2

89.8

All staff leaver and joiner distribution by disability: 31 March 2019
Disability (numbers)

Disability (%)

Category

Total

Disabled

Not disabled

Disabled

Not disabled

Leavers
Joiners

2,767
3,307

323
351

2,444
2,956

11.7
10.6

88.3
89.4

All staff leaver distribution by disability and reason for leaving: 31 March 2019
Disability (numbers)
Reason for leaving

Disability (%)

Total

Disabled

Not disabled

Disabled

Not disabled

Voluntary
Redundancy
End FTC
Other Involuntary
Other

1,131
279
1,221
72
64

115
44
150
*
*

1,016
235
1,071
66
56

10.2
15.8
12.3
*
*

89.8
84.2
87.7
91.7
87.5

Grand Total

2,767

323

2,444

11.7

88.3

262

BBC Group Annual Report and Accounts 2018/19

Return to contents

A D D I T I O N A L I N F O R M AT I O N

All staff internal mover distribution by disability: 31 March 2019
Disability (numbers)
Internal move type

Disability (%)

Total

Disabled

Not disabled

Disabled

Not disabled

Attachment
Promotion
Transfer

1,506
605
1,260

163
78
132

1,343
527
1,128

10.8
12.9
10.5

89.2
87.1
89.5

Grand Total

3,371

373

2,998

11.1

88.9

All staff disability distribution by contract type: 31 March 2019
Disability (numbers)
Contract type

Disability (%)

Total

Disabled

Not disabled

Disabled

Not disabled

Continuing
Fixed Term less than one year
Fixed Term one year +Flexicon17,851
1,677
481
43

1,818
185
45
*

16,033
1,492
436
38

10.2
11.0
9.4
*

89.8
89.0
90.6
88.4

Grand Total

20,052

2,053

17,99910.2

89.8

All staff disability distribution by length of service: 31 March 2019
Disability (numbers)
Length of service (yrs)Disability (%)

Total

Disabled

Not disabled

Disabled

Not disabled

<1
1-<3
3-<5
5-<10
10+

2,639
2,743
2,161
3,447
9,062

259
240
229
359
966

2,380
2,503
1,932
3,088
8,096

9.8
8.7
10.6
10.4
10.7

90.2
91.3
89.4
89.6
89.3

Grand Total

20,052

2,053

17,99910.2

89.8

Ethnicity
All staff ethnicity distribution by division: 31 March 2019
Ethnicity band (numbers)

Ethnicity band (%)

Total

BAME

Other whitebackgroundContent
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

834
212
5,401
5,837
3,112
1,879

125
27
1,006
335
485
212

53
17
315
393
226
86

656
168
4,080
5,109
2,401
1,581

15.0
12.7
18.6
5.7
15.6
11.3

6.3
8.0
5.9
6.7
7.2
4.6

78.7
79.3
75.5
87.6
77.2
84.1

UK Public Service

17,275

2,190

1,090

13,995

12.7

6.3

81.0

World Service GroupBBC Studios
Other

1,341
2,049
257

697
287
24

121
150
*

523
1,612
227

52.0
14.0
9.3

9.0
7.3
*

39.0
78.7
88.3

Grand Total

20,922

3,198

1,367

16,357

15.3

6.5

78.2

Division

White
UK

BAME

Other whitebackground

White
UK

All staff data reflects UK-based employee contracts only.
Leadership is defined as Band E and above.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

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BBC Group Annual Report and Accounts 2018/19

263

E Q UA L I T Y I N F O R M AT I O N R E P O R T

Leadership staff ethnicity distribution by division: 31 March 2019
Ethnicity band (numbers)

Ethnicity band (%)

Total

BAME

Other whitebackgroundContent
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

191
67
1,001
660
567
233

20
*
105
29
62
25

11
*
70
53
27
12

160
58
826
578
478
196

10.5
*
10.5
4.4
10.9
10.7

5.8
*
7.0
8.0
4.8
5.2

83.7
86.5
82.5
87.6
84.3
84.1

UK Public Service

2,719

244

179

2,296

9.0

6.6

84.4

World Service GroupBBC Studios
Other

186
522
16

88
64
*

11
42
*

87
416
14

47.3
12.3
*

5.9
8.0
*

46.8
79.7
87.5

3,443

397

233

2,813

11.5

6.8

81.7

DivisionGrand Total

White
UK

BAME

Other whitebackground

White
UK

All staff ethnicity distribution by Job Family: 31 March 2019
Ethnicity band (numbers)

Ethnicity band (%)

Total

BAME

Other whitebackground

Commissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

171
9,868
553
3,286
5,253
1,791

24
1,530
70
572
735
267

13
672
39
218
302
123

134
7,666
444
2,496
4,216
1,401

14.0
15.5
12.7
17.4
14.0
14.9

7.6
6.8
7.1
6.6
5.8
6.9

78.4
77.6
80.2
76.0
80.3
78.2

Grand Total

20,922

3,198

1,367

16,357

15.3

6.5

78.2

Job Family

White
UK

BAME

Other whitebackground

White
UK

Leadership staff ethnicity distribution by Job Family: 31 March 2019
Ethnicity band (numbers)

Ethnicity band (%)

Total

BAME

Other whitebackground

Commissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

132
1,626
102
756
458
369

17
195
*
77
48
53

11
92
*
61
29
32

104
1,339
87
618
381
284

12.9
12.0
*
10.2
10.5
14.4

8.3
5.7
*
8.1
6.3
8.7

78.8
82.3
85.3
81.7
83.2
76.9

Grand Total

3,443

397

233

2,813

11.5

6.8

81.7

Job Family

White
UK

BAME

Other whitebackground

White
UK

All staff ethnicity distribution by grade bands: 31 March 2019
Ethnicity band (numbers)

Ethnicity band (%)

Total

BAME

Other whitebackground

A
B
C
D
E
F
SL
Not Allocated

394
2,348
6,711
6,351
2,014
836
224
2,044

73
354
1,176
923
255
73
16
328

14
156
472
390
128
55
17
135

307
1,838
5,063
5,038
1,631
708
191
1,581

18.5
15.1
17.5
14.5
12.7
8.7
7.1
16.0

3.6
6.6
7.0
6.1
6.4
6.6
7.6
6.6

77.8
78.3
75.4
79.3
80.9
84.6
85.3
77.4

Grand Total

20,922

3,198

1,367

16,357

15.3

6.5

78.2

Grade band

264

BBC Group Annual Report and Accounts 2018/19

White
UK

BAME

Other whitebackground

White
UK

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A D D I T I O N A L I N F O R M AT I O N

All staff leaver and joiner distribution by ethnicity: 31 March 2019
Ethnicity band (numbers)
Category

Total

BAME

Other whitebackground

Leavers
Joiners

2,926
3,443

538
707

229
220

Ethnicity band (%)
White
UK

BAME

Other whitebackground

White
UK

2,159
2,516

18.4
20.5

7.8
6.4

73.8
73.1

All staff leaver distribution by ethnicity and reason for leaving: 31 March 2019
Ethnicity band (numbers)

Ethnicity band (%)

Total

BAME

Other whitebackground

Voluntary
Redundancy
End FTC
Other Involuntary
Other

1,205
281
1,300
75
65

237
53
233
11
*

106
22
89
8
*

862
206
978
56
57

19.7
18.9
17.9
14.7
*

8.8
7.8
6.8
10.7
*

71.5
73.3
75.2
74.6
87.7

Grand Total

2,926

538

229

2,159

18.4

7.8

73.8

Reason for leaving

White
UK

BAME

Other whitebackground

White
UK

All staff internal mover distribution by ethnicity: 31 March 2019
Ethnicity band (numbers)

Ethnicity band (%)

Total

BAME

Other whitebackgroundAttachment
Promotion
Transfer

1,583
645
1,363

252
108
247

117
61
95

1,214
476
1,021

15.9
16.7
18.1

7.4
9.5
7.0

76.6
73.7
74.8

Grand Total

3,591

607

273

2,711

16.9

7.6

75.5

Internal move type

White
UK

BAME

Other whitebackground

White
UK

All staff ethnicity distribution by contract type: 31 March 2019
Ethnicity band (numbers)

Ethnicity band (%)

Total

BAME

Other whitebackgroundContinuing
Fixed Term less than one year
Fixed Term one year +Flexicon18,549
1,787
543
43

2,728
349
119
*

1,190
128
43
*

14,631
1,310
381
35

14.7
19.5
21.9
*

6.4
7.2
7.9
*

78.8
73.2
70.2
81.4

Grand Total

20,922

3,198

1,367

16,357

15.3

6.5

78.2

Contract type

White
UK

BAME

Other whitebackground

White
UK

All staff ethnicity distribution by length of service: 31 March 2019
Ethnicity band (numbers)

Ethnicity band (%)

Total

BAME

Other whitebackground

<1
1-<3
3-<5
5-<10
10+

2,705
3,285
2,168
3,432
9,332

592
585
369
534
1,118

173
289
164
245
496

1,940
2,411
1,635
2,653
7,718

21.9
17.8
17.0
15.6
12.0

6.4
8.8
7.6
7.1
5.3

71.7
73.4
75.4
77.3
82.7

Grand Total

20,922

3,198

1,367

16,357

15.3

6.5

78.2

Length of service (yrs)

White
UK

BAME

Other whitebackground

White
UK

All staff data reflects UK-based employee contracts only.
Leadership is defined as Band E and above.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

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BBC Group Annual Report and Accounts 2018/19

265

E Q UA L I T Y I N F O R M AT I O N R E P O R T

GenderAll staff gender distribution by division: 31 March 2019
Gender band (numbers)
Division

Gender band (%)

Total

FemaleMale

FemaleMale

Content
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

871
215
5,640
6,051
3,254
1,933

414
158
2,317
2,735
1,499
1,111

457
57
3,323
3,316
1,755
822

47.5
73.5
41.1
45.2
46.1
57.5

52.5
26.5
58.9
54.8
53.9
42.5

UK Public Service

17,964

8,234

9,730

45.8

54.2

World Service GroupBBC Studios
Other
Grand Total

1,472
2,127
264
21,827

762
1,321
140
10,457710
806
124
11,370

51.8
62.1
53.0
47.9

48.2
37.9
47.0
52.1

Leadership staff gender distribution by division: 31 March 2019
Gender band (numbers)
Division

Gender band (%)

Total

FemaleMale

FemaleMale

Content
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

198
69
1,042
680
591
239

95
42
417
268
256
118

103
27
625
412
335
121

48.0
60.9
40.0
39.4
43.3
49.4

52.0
39.1
60.0
60.6
56.7
50.6

UK Public Service

2,819

1,196

1,623

42.4

57.6

World Service GroupBBC Studios
Other

200
541
17

85
284
*

115
257
15

42.5
52.5
*

57.5
47.5
88.2

3,577

1,567

2,010

43.8

56.2

Grand Total

All staff gender distribution by Job Family: 31 March 2019
Gender band (numbers)
Job Family

Gender band (%)

Total

FemaleMale

FemaleMaleCommissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated177
10,281
576
3,401
5,526
1,866

98
5,382
373
2,192
1,370
1,042

79
4,899
203
1,209
4,156
824

55.4
52.3
64.8
64.5
24.8
55.8

44.6
47.7
35.2
35.5
75.2
44.2

Grand Total

21,827

10,457

11,37047.9

52.1

Leadership staff gender distribution by Job Family: 31 March 2019
Gender band (numbers)
Job Family

Gender band (%)

Total

FemaleMale

FemaleMaleCommissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

136
1,683
106
785
480
387

68
741
56
413
93
196

68
942
50
372
387
191

50.0
44.0
52.8
52.6
19.4
50.6

50.0
56.0
47.2
47.4
80.6
49.4

Grand Total

3,577

1,567

2,010

43.8

56.2

266

BBC Group Annual Report and Accounts 2018/19

Return to contents

A D D I T I O N A L I N F O R M AT I O N

All staff gender distribution by grade bands: 31 March 2019
Gender band (numbers)
Grade band

Gender band (%)

Total

FemaleMale

Female

Male

A
B
C
D
E
F
SL
Not Allocated

406
2,431
7,018
6,658
2,094
868
228
2,124

234
1,520
3,385
2,800
913
366
93
1,146

172
911
3,633
3,858
1,181
502
135
978

57.6
62.5
48.2
42.1
43.6
42.2
40.8
54.0

42.4
37.5
51.8
57.9
56.4
57.8
59.2
46.0

Grand Total

21,827

10,457

11,37047.9

52.1

All staff leaver and joiner distribution by gender: 31 March 2019
Gender band (numbers)

Gender band (%)

Category

Total

FemaleMale

FemaleMale

Leavers
Joiners

3,123
3,649

1,719
2,034

1,404
1,615

55.0
55.7

45.0
44.3

All staff leaver distribution by gender and reason for leaving: 31 March 2019
Gender band (numbers)
Reason for leaving

Gender band (%)

Total

FemaleMale

FemaleMale

Voluntary
Redundancy
End FTC
Other Involuntary
Other

1,279
301
1,398
78
67

662
144
838
52
23

617
157
560
26
44

51.8
47.8
59.9
66.7
34.3

48.2
52.2
40.1
33.3
65.7

Grand Total

3,123

1,719

1,404

55.0

45.0

All staff internal mover distribution by gender: 31 March 2019
Gender band (numbers)
Internal move type

Gender band (%)

Total

FemaleMale

FemaleMale

Attachment
Promotion
Transfer

1,633
678
1,424

928
349
772

705
329
652

56.8
51.5
54.2

43.2
48.5
45.8

Grand Total

3,735

2,049

1,686

54.9

45.1

All staff gender distribution by contract type: 31 March 2019
Gender band (numbers)
Contract type

Gender band (%)

Total

FemaleMale

FemaleMaleContinuing
Fixed Term less than one year
Fixed Term one year +Flexicon19,353
1,858
572
44

9,043
1,113
276
25

10,310
745
296
19

46.7
59.9
48.3
56.8

53.3
40.1
51.7
43.2

Grand Total

21,827

10,457

11,37047.9

52.1

All staff gender distribution by length of service: 31 March 2019
Gender band (numbers)
Length of service (yrs)Gender band (%)

Total

FemaleMale

Female

Male

<1
1-<3
3-<5
5-<10
10+

2,837
3,487
2,251
3,597
9,655

1,533
1,745
1,100
1,770
4,309

1,304
1,742
1,151
1,827
5,346

54.0
50.0
48.9
49.2
44.6

46.0
50.0
51.1
50.8
55.4

Grand Total

21,827

10,457

11,37047.9

52.1

All staff data reflects UK-based employee contracts only.
Leadership is defined as Band E and above.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

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BBC Group Annual Report and Accounts 2018/19

267

E Q UA L I T Y I N F O R M AT I O N R E P O R T

FaithAll staff religion and belief distribution (numbers): 31 March 2019

Total

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
ExcludedContent
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

871
215
5,640
6,051
3,254
1,933

137
40
1,147
819
516
321

*
*
40
19
12
13

272
72
1,582
2,005
754
518

*
*
140
27
34
10

*
*
44
19
63
15

13
*
145
45
79
22

12
*
68
18
21
11

24
*
185
169
86
71

318
74
1,824
2,443
1,401
794

79
14
465
487
288
158

UK Public Service

17,964

2,980

87

5,203

217

153

305

132

542

6,854

1,491

World Service GroupBBC Studios
Other

1,472
2,127
264

195
411
42

30
13
*

249
592
75

24
27
*

15
20
*

205
33
*

*
*
*

51
72
10

517
742
106

182
209
17

21,827

3,628

130

6,119

273

191

547

146

675

8,219

1,899

DivisionGrand Total

All staff religion and belief distribution (percentage): 31 March 2019

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
ExcludedContent
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

15.7
18.6
20.3
13.5
15.9
16.6

*
*
0.7
0.3
0.4
0.7

31.2
33.5
28.0
33.1
23.2
26.8

*
*
2.5
0.5
1.0
0.5

*
*
0.8
0.3
1.9
0.8

1.5
*
2.6
0.7
2.4
1.1

1.4
*
1.2
0.3
0.6
0.6

2.8
*
3.3
2.8
2.6
3.7

36.5
34.4
32.4
40.4
43.1
41.1

9.1
6.5
8.2
8.1
8.9
8.1

UK Public Service

16.6

0.5

29.0

1.2

0.9

1.7

0.7

3.0

38.2

8.2

World Service GroupBBC Studios
Other

13.3
19.3
15.9

2.0
0.6
*

16.9
27.8
28.4

1.6
1.3
*

1.0
0.9
*

13.9
1.6
*

*
*
*

3.5
3.4
3.8

35.1
34.9
40.2

12.4
9.8
6.4

Grand Total

16.6

0.6

28.0

1.3

0.9

2.5

0.7

3.1

37.6

8.7

Division

Leadership staff religion and belief distribution (numbers): 31 March 2019

Total

BBC total

Total

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
Excluded

3,577

601

19

1,136

44

45

58

28

95

1,262

289

Leadership staff religion and belief distribution (percentage): 31 March 2019

Total

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
Excluded

BBC total

16.8

0.5

31.7

1.2

1.3

1.6

0.8

2.7

35.3

8.1

268

BBC Group Annual Report and Accounts 2018/19

Return to contents

A D D I T I O N A L I N F O R M AT I O N

All staff religion and belief distribution by job family (numbers): 31 March 2019

Total

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
ExcludedCommissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated177
10,281
576
3,401
5,526
1,866

35
1,633
108
491
1,091
270

*
59
*
16
40
11

48
2,838
165
1,246
1,353
469

*
72
*
62
96
35

*
96
10
36
22
22

*
311
*
82
112
38

*
54
*
54
23
11

*
296
22
109
185
58

56
3,927
203
1,053
2,173
807

22
995
54
252
431
145

Grand Total

21,827

3,628

130

6,119

273

191

547

146

675

8,219

1,899

Job Family

All staff religion and belief distribution by job family (percentage): 31 March 2019

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
ExcludedCommissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

19.8
15.9
18.8
14.4
19.8
14.5

*
0.6
*
0.5
0.7
0.6

27.1
27.6
28.6
36.6
24.5
25.1

*
0.7
*
1.8
1.7
1.9

*
0.9
1.7
1.1
0.4
1.2

*
3.0
*
2.4
2.0
2.0

*
0.5
*
1.6
0.4
0.6

*
2.9
3.8
3.2
3.4
3.1

31.6
38.2
35.2
31.0
39.3
43.2

12.5
9.7
9.4
7.4
7.8
7.8

Grand Total

16.6

0.6

28.0

1.3

0.9

2.5

0.7

3.1

37.6

8.7

Job Family

Leadership staff religion and belief distribution by job family (numbers): 31 March 2019

Total

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
ExcludedCommissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

136
1,683
106
785
480
387

26
250
21
126
112
66

*
*
*
*
*
*

37
492
30
314
133
130

*
12
*
10
12
*

*
18
*
*
*
*

*
30
*
10
*
*

*
10
*
*
*
*

*
34
*
28
14
10

42
688
35
223
152
122

16
140
*
54
40
30

Grand Total

3,577

601

19

1,136

44

45

58

28

95

1,262

289

Job Family

Leadership staff religion and belief distribution by job family (percentage): 31 March 2019

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
ExcludedCommissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

19.1
14.9
19.8
16.1
23.3
17.1

*
*
*
*
*
*

27.2
29.2
28.3
39.9
27.7
33.6

*
0.7
*
1.3
2.5
*

*
1.1
*
*
*
*

*
1.8
*
1.3
*
*

*
0.6
*
*
*
*

*
2.0
*
3.6
2.9
2.6

30.9
40.9
33.0
28.4
31.7
31.4

11.7
8.3
*
6.9
8.3
7.8

Grand Total

16.8

0.5

31.7

1.2

1.3

1.6

0.8

2.7

35.3

8.1

Job Family

All staff data reflects UK-based employee contracts only.
Leadership is defined as Band E and above.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

Return to contents

BBC Group Annual Report and Accounts 2018/19

269

E Q UA L I T Y I N F O R M AT I O N R E P O R T

All staff religion and belief distribution by grade bands (numbers): 31 March 2019

Total

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
Excluded

A
B
C
D
E
F
SL
Not Allocated

406
2,431
7,018
6,658
2,094
868
228
2,124

61
358
1,186
1,153
360
137
38
335

*
10
54
37
14
*
*
12

135
796
1,887
1,772
615
292
94
528

*
19
76
96
28
*
*
38

*
17
55
56
20
13
*
25

*
60
219
162
35
10
*
50

*
19
39
45
21
*
*
14

13
81
211
217
56
23
*
67

151
844
2,649
2,538
777
305
61
894

27
227
642
582
168
76
16
161

Grand Total

21,827

3,628

130

6,119

273

191

547

146

675

8,219

1,899

Grade band

All staff religion and belief distribution by grade bands (percentage): 31 March 2019

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
Excluded

A
B
C
D
E
F
SL
Not Allocated

15.0
14.7
16.9
17.3
17.2
15.8
16.7
15.8

*
0.4
0.8
0.6
0.7
*
*
0.6

33.3
32.7
26.9
26.6
29.4
33.6
41.2
24.9

*
0.8
1.1
1.4
1.3
*
*
1.8

*
0.7
0.8
0.8
1.0
1.5
*
1.2

*
2.5
3.1
2.4
1.7
1.2
*
2.4

*
0.8
0.6
0.7
1.0
*
*
0.7

3.2
3.3
3.0
3.3
2.6
2.6
*
3.1

37.2
34.7
37.7
38.1
37.1
35.1
26.7
42.0

6.7
9.4
9.1
8.8
8.0
8.8
7.0
7.5

Grand Total

16.6

0.6

28.0

1.3

0.9

2.5

0.7

3.1

37.6

8.7

Grade band

All staff leaver and joiner distribution by religion and belief (numbers): 31 March 2019

Category

Total

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
Excluded

Leavers
Joiners

3,123
3,649

591
726

20
33

728
839

55
58

23
26

69
104

20
32

178
146

998
1,062

441
623

All staff leaver and joiner distribution by religion and belief (percentage): 31 March 2019

Category

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
Excluded

Leavers
Joiners

18.9
19.9

0.6
0.9

23.3
23.0

1.8
1.6

0.8
0.7

2.2
2.9

0.6
0.9

5.7
4.0

32.0
29.1

14.1
17.0

All staff leaver distribution by religion and belief and reason for leaving (numbers): 31 March 2019

Total

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
Excluded

Voluntary
Redundancy
End FTC
Other Involuntary
Other

1,279
301
1,398
78
67

243
46
284
13
*

*
*
10
*
*

304
104
279
24
17

38
*
*
*
*

12
*
*
*
*

20
*
39
*
*

12
*
*
*
*

60
15
100
*
*

453
86
393
32
34

130
30
270
*
*

Grand Total

3,123

591

20

728

55

23

69

20

178

998

441

Reason for leaving

270

BBC Group Annual Report and Accounts 2018/19

Return to contents

A D D I T I O N A L I N F O R M AT I O N

All staff leaver distribution by religion and belief and reason for leaving (percentage): 31 March 2019

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
Excluded

Voluntary
Redundancy
End FTC
Other Involuntary
Other

19.0
15.3
20.3
16.7
*

*
*
0.7
*
*

23.8
34.6
20.0
30.8
25.4

3.0
*
*
*
*

0.9
*
*
*
*

1.6
*
2.8
*
*

0.9
*
*
*
*

4.7
5.0
7.2
*
*

35.4
28.5
28.1
41.0
50.7

10.2
9.9
19.3
*
*

Grand Total

18.9

0.6

23.3

1.8

0.7

2.2

0.7

5.7

32.0

14.1

Reason for leaving

All staff internal mover distribution by religion and belief (numbers): 31 March 2019

Total

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
Excluded

Attachment
Promotion
Transfer

1,633
678
1,424

293
145
257

10
*
*

410
163
373

24
*
29

16
*
10

43
20
43

20
*
15

40
26
74

637
239
482

140
64
137

Grand Total

3,735

695

17

946

60

32

106

40

140

1,358

341

Internal move typeAll staff internal mover distribution by religion and belief (percentage): 31 March 2019

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
Excluded

Attachment
Promotion
Transfer

17.9
21.4
18.0

0.6
*
*

25.1
24.0
26.2

1.5
*
2.0

1.0
*
0.7

2.6
2.9
3.0

1.2
*
1.1

2.5
3.8
5.2

39.0
35.3
33.9

8.6
9.5
9.6

Grand Total

18.6

0.5

25.3

1.6

0.9

2.8

1.1

3.7

36.4

9.1

Internal move typeAll staff religion and belief distribution by contract type (numbers): 31 March 2019

Total

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
ExcludedContinuing
Fixed Term less than one year
Fixed Term one year +Flexicon19,353
1,858
572
44

3,169
348
104
7

112
14
*
*

5,503
447
156
13

237
26
10
*

164
23
*
*

472
61
14
*

121
20
*
*

579
81
11
*

7,448
574
180
17

1,548
264
84
*

Grand Total

21,827

3,628

130

6,119

273

191

547

146

675

8,219

1,899

Contract typeAll staff religion and belief distribution by contract type (percentage): 31 March 2019

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
ExcludedContinuing
Fixed Term less than one year
Fixed Term one year +Flexicon

16.4
18.7
18.2
15.9

0.6
0.8
*
*

28.4
24.1
27.3
29.6

1.2
1.4
1.7
*

0.8
1.2
*
*

2.5
3.3
2.4
*

0.6
1.1
*
*

3.0
4.4
1.9
*

38.5
30.8
31.5
38.6

8.0
14.2
14.7
*

Grand Total

16.6

0.6

28.0

1.3

0.9

2.5

0.7

3.1

37.6

8.7

Contract typeAll staff data reflects UK-based employee contracts only.
Leadership is defined as Band E and above.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

Return to contents

BBC Group Annual Report and Accounts 2018/19

271

E Q UA L I T Y I N F O R M AT I O N R E P O R T

All staff religion and belief distribution by length of service (numbers): 31 March 2019

Total

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
Excluded

<1
1-<3
3-<5
5-<10
10+

2,837
3,487
2,251
3,597
9,655

562
646
470
665
1,285

25
27
10
17
51

680
932
669
1,062
2,776

51
59
43
49
71

24
29
24
31
83

90
91
72
137
157

27
20
31
17
51

93
110
95
115
262

847
1,170
664
1,237
4,301

438
403
173
267
618

Grand Total

21,827

3,628

130

6,119

273

191

547

146

675

8,219

1,899

Length of service (yrs)

All staff religion and belief distribution by length of service (percentage): 31 March 2019

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
Excluded

<1
1-<3
3-<5
5-<10
10+

19.8
18.5
20.9
18.5
13.3

0.9
0.8
0.4
0.5
0.5

24.0
26.7
29.7
29.5
28.8

1.8
1.7
1.9
1.4
0.7

0.8
0.8
1.1
0.9
0.9

3.2
2.6
3.2
3.8
1.6

1.0
0.6
1.4
0.5
0.5

3.3
3.2
4.2
3.2
2.7

29.8
33.6
29.5
34.3
44.6

15.4
11.5
7.7
7.4
6.4

Grand Total

16.6

0.6

28.0

1.3

0.9

2.5

0.7

3.1

37.6

8.7

Transgender

LGBTQ+

Length of service (yrs)Sexuality
All staff sexual orientation and gender identity distribution by division (numbers): 31 March 2019
Heterosexual/straight

Other

Prefernot tosay/
Excluded

Total

Bisexual

Gay manGaywoman/
lesbianContent
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

871
215
5,640
6,051
3,254
1,933

18
*
119
66
63
41

23
12
213
203
132
76

18
*
65
37
31
28

657
177
4,432
4,144
2,008
1,292

*
*
29
27
21
14

153
23
782
1,574
999
482

12
*
115
108
61
51

70
20
519
425
293
203

UK Public Service

17,964

309

659

179

12,710

94

4,013

352

1,530

World Service GroupBBC Studios
Other

1,472
2,127
264

30
52
*

36
88
*

*
16
*

979
1,676
207

13
*
*

410
288
47

13
58
*

94
218
13

21,827391

790

202 15,572

114

4,758

426

1,855

Transgender

LGBTQ+

DivisionGrand Total

All staff sexual orientation and gender identity distribution by division (percentage): 31 March 2019

DivisionContent
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

Heterosexual/straight

Other

Prefernot tosay/
Excluded

Bisexual

Gay manGaywoman/
lesbian

2.1
*
2.1
1.1
1.9
2.1

2.6
5.6
3.8
3.4
4.1
3.9

2.1
*
1.2
0.6
1.0
1.4

75.4
82.3
78.6
68.5
61.7
66.9

*
*
0.5
0.4
0.6
0.7

17.6
10.7
13.8
26.0
30.7
25.0

1.4
*
2.0
1.8
1.9
2.6

9.7
10.4
10.7
9.5
13.0
14.0

UK Public Service

1.7

3.7

1.0

70.8

0.5

22.3

2.0

10.9

World Service GroupBBC Studios
Other

2.0
2.4
*

2.4
4.1
*

*
0.8
*

66.5
78.8
78.4

0.9
*
*

27.9
13.6
17.8

0.9
2.7
*

8.8
11.8
6.0

Grand Total

1.8

3.6

0.9

71.4

0.5

21.8

2.0

10.8

272

BBC Group Annual Report and Accounts 2018/19

Return to contents

A D D I T I O N A L I N F O R M AT I O N

Leadership staff sexual orientation and gender identity distribution by division (numbers): 31 March 2019

Total

BBC total

Total

Bisexual

Gay manGaywoman/
lesbian

3,577

44

161

35

Heterosexual/straight

2,588

Other

Prefernot tosay/
ExcludedTransgender

LGBTQ+

17

732

83

325

Transgender

LGBTQ+

Leadership staff sexual orientation and gender identity distribution by division (percentage): 31 March 2019

Total

BBC total

Bisexual

Gay manGaywoman/
lesbian

1.2

4.5

1.0

Heterosexual/straight

Other

Prefernot tosay/
Excluded

72.3

0.5

20.5

2.3

11.4

Transgender

LGBTQ+All staff sexual orientation and gender identity distribution by job family (numbers): 31 March 2019
Heterosexual/straight

Other

Prefernot tosay/
Excluded

Total

Bisexual

Gay manGaywoman/
lesbianCommissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated177
10,281
576
3,401
5,526
1,866

*
190
10
55
109
25

12
375
33
112
189
69

*
89
*
39
56
*

132
6,987
459
2,798
3,891
1,305

*
58
*
15
37
*

28
2,582
65
382
1,244
457

*
213
12
76
78
40

23
890
62
292
448
140

Grand Total

21,827391

790

202 15,572

114

4,758

426

1,855

Transgender

LGBTQ+

Job Family

All staff sexual orientation and gender identity distribution by job family (percentage): 31 March 2019
Heterosexual/straight

Other

Prefernot tosay/
Excluded

Bisexual

Gay manGaywoman/
lesbianCommissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

*
1.8
1.7
1.6
2.0
1.3

6.8
3.6
5.7
3.3
3.4
3.7

*
0.9
*
1.1
1.0
*

74.6
68.0
79.7
82.3
70.4
69.9

*
0.6
*
0.4
0.7
*

15.8
25.1
11.3
11.3
22.5
24.5

*
2.1
2.1
2.2
1.4
2.1

15.2
11.5
12.1
9.7
10.5
9.9

Grand Total

1.8

3.6

0.9

71.4

0.5

21.8

2.0

10.8

Transgender

LGBTQ+

Job Family

All staff sexual orientation and gender identity distribution by grade bands (numbers): 31 March 2019
Heterosexual/straight

Other

Prefernot tosay/
Excluded

Total

Bisexual

Gay manGaywoman/
lesbian

A
B
C
D
E
F
SL
Not Allocated

406
2,431
7,018
6,658
2,094
868
228
2,124

*
62
140
96
29
*
*
44

10
76
239
250
85
38
14
78

*
20
69
62
21
11
*
10

298
1,841
5,013
4,638
1,450
649
171
1,512

*
19
37
31
11
*
*
*

78
413
1,520
1,581
498
159
33
476

*
47
136
121
42
21
*
44

37
213
598
543
182
76
31
175

Grand Total

21,827391

790

202 15,572

114

4,758

426

1,855

Grade band

All staff data reflects UK-based employee contracts only.
Leadership is defined as Band E and above.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

Return to contents

BBC Group Annual Report and Accounts 2018/19

273

E Q UA L I T Y I N F O R M AT I O N R E P O R T

All staff sexual orientation and gender identity distribution by grade bands (percentage): 31 March 2019

Other

Prefernot tosay/
ExcludedTransgender

LGBTQ+

Bisexual

Gay manGaywoman/
lesbian

A
B
C
D
E
F
SL
Not Allocated

*
2.6
2.0
1.4
1.4
*
*
2.1

2.5
3.1
3.4
3.8
4.1
4.4
6.1
3.7

*
0.8
1.0
0.9
1.0
1.3
*
0.5

73.4
75.7
71.4
69.7
69.2
74.8
75.0
71.2

*
0.8
0.5
0.5
0.5
*
*
*

19.2
17.0
21.7
23.7
23.8
18.3
14.5
22.4

*
1.9
1.9
1.8
2.0
2.4
*
2.1

11.3
10.5
10.9
10.7
11.4
10.7
15.9
10.6

Grand Total

1.8

3.6

0.9

71.4

0.5

21.8

2.0

10.8

Transgender

LGBTQ+

Grade band

Heterosexual/straight

All staff leaver and joiner distribution by sexual orientation and gender identity (numbers): 31 March 2019

Category

Total

Bisexual

Gay manGaywoman/
lesbianLeavers
Joiners

3,123
3,649

100
123

138
143

45
46

Heterosexual/straight

Other

Prefernot tosay/
Excluded

2,269
2,771

30
27

541
539

39
15

357
400

Transgender

LGBTQ+

1.2
0.4

13.8
12.8

Transgender

LGBTQ+All staff leaver and joiner distribution by sexual orientation and gender identity (percentage): 31 March 2019

Category

Bisexual

Gay manGaywoman/
lesbianLeavers
Joiners

3.2
3.4

4.4
3.9

1.4
1.3

Heterosexual/straight

Other

Prefernot tosay/
Excluded

72.7
75.9

1.0
0.7

17.3
14.8

All staff leaver distribution by sexual orientation and gender identity and reason for leaving (numbers): 31 March 2019
Heterosexual/straight

Other

Prefernot tosay/
Excluded

Total

Bisexual

Gay manGaywoman/
lesbianVoluntary
Redundancy
End FTC
Other Involuntary
Other

1,279
301
1,398
78
67

33
*
64
*
*

66
*
54
*
*

21
*
17
*
*

945
212
1,016
58
38

13
*
15
*
*

201
69
232
13
26

19
*
12
*
*

150
24
172
*
*

Grand Total

3,123

100

138

45

2,269

30

541

39

357

Reason for leaving

All staff leaver distribution by sexual orientation and gender identity and reason for leaving (percentage): 31 March 2019

Other

Prefernot tosay/
ExcludedTransgender

LGBTQ+

Bisexual

Gay manGaywoman/
lesbianVoluntary
Redundancy
End FTC
Other Involuntary
Other

2.6
*
4.6
*
*

5.2
*
3.9
*
*

1.6
*
1.2
*
*

73.9
70.4
72.7
74.4
56.7

1.0
*
1.1
*
*

15.7
22.9
16.5
16.6
38.8

1.5
*
0.9
*
*

13.8
10.3
14.7
*
*

Grand Total

3.2

4.4

1.4

72.7

1.0

17.3

1.2

13.8

Reason for leaving

274

BBC Group Annual Report and Accounts 2018/19

Heterosexual/straight

Return to contents

A D D I T I O N A L I N F O R M AT I O N

All staff internal mover distribution by sexual orientation and gender identity (numbers): 31 March 2019

Other

Prefernot tosay/
ExcludedTransgender

LGBTQ+

Total

Bisexual

Gay manGaywoman/
lesbianAttachment
Promotion
Transfer

1,633
678
1,424

24
16
30

74
31
59

20
*
11

1,188
520
1,135

*
*
13

321
99
176

40
10
17

160
69
127

Grand Total

3,735

70

164

39

2,843

23

596

67

356

Transgender

LGBTQ+

Category

Heterosexual/straight

All staff internal mover distribution by sexual orientation and gender identity (percentage): 31 March 2019
Heterosexual/straight

Other

Prefernot tosay/
Excluded

Bisexual

Gay manGaywoman/
lesbianAttachment
Promotion
Transfer

1.5
2.4
2.1

4.5
4.6
4.1

1.2
*
0.8

72.7
76.7
79.7

*
*
0.9

19.7
14.6
12.4

2.4
1.5
1.2

12.2
11.9
10.2

Grand Total

1.9

4.4

1.0

76.1

0.6

16.0

1.8

9.5

Transgender

LGBTQ+

Category

All staff sexual orientation and gender identity distribution by contract type (numbers): 31 March 2019
Heterosexual/straight

Other

Prefernot tosay/
Excluded

Total

Bisexual

Gay manGaywoman/
lesbianContinuing
Fixed Term less than one year
Fixed Term one year +Flexicon19,353
1,858
572
44

300
68
22
*

689
79
21
*

176
19
*
*

13,652
1,435
452
33

92
16
*
*

4,444
241
65
8

374
41
11
*

1,567
220
65
*

Grand Total

21,827391

790

202 15,572

114

4,758

426

1,855

Transgender

LGBTQ+

Contract typeAll staff sexual orientation and gender identity distribution by contract type (percentage): 31 March 2019
Heterosexual/straight

Other

Prefernot tosay/
Excluded

Bisexual

Gay manGaywoman/
lesbianContinuing
Fixed Term less than one year
Fixed Term one year +Flexicon

1.6
3.7
3.8
*

3.6
4.3
3.7
*

0.9
1.0
*
*

70.5
77.2
79.0
75.0

0.5
0.9
*
*

22.9
12.9
11.4
18.1

1.9
2.2
1.9
*

10.5
13.6
12.8
*

Grand Total

1.8

3.6

0.9

71.4

0.5

21.8

2.0

10.8

Transgender

LGBTQ+

Contract typeAll staff sexual orientation and gender identity distribution by length of service (numbers): 31 March 2019
Heterosexual/straight

Other

Prefernot tosay/
Excluded

Total

Bisexual

Gay manGaywoman/
lesbian

<1
1-<3
3-<5
5-<10
10+

2,837
3,487
2,251
3,597
9,655

94
81
46
57
113

109
137
92
152
300

35
36
24
33
74

2,195
2,760
1,870
2,833
5,914

18
18
17
14
47

386
455
202
508
3,207

62
60
49
64
191

311
323
221
309
691

Grand Total

21,827391

790

202 15,572

114

4,758

426

1,855

Length of service (yrs)

All staff data reflects UK-based employee contracts only.
Leadership is defined as Band E and above.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

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BBC Group Annual Report and Accounts 2018/19

275

E Q UA L I T Y I N F O R M AT I O N R E P O R T

All staff sexual orientation and gender identity distribution by length of service (percentage): 31 March 2019

Other

Prefernot tosay/
ExcludedTransgender

LGBTQ+

Bisexual

Gay manGaywoman/
lesbian

<1
1-<3
3-<5
5-<10
10+

3.3
2.3
2.0
1.6
1.2

3.8
3.9
4.1
4.2
3.1

1.2
1.0
1.1
0.9
0.8

77.4
79.2
83.1
78.8
61.3

0.7
0.5
0.8
0.4
0.4

13.6
13.1
8.9
14.1
33.2

2.2
1.7
2.2
1.8
2.0

12.7
10.6
10.8
10.0
10.7

Grand Total

1.8

3.6

0.9

71.3

0.6

21.8

2.0

10.8

Length of service (yrs)Heterosexual/straight

Socio-economic
All staff socio-economic background (school type) distribution by division: 31 March 2019
School Type (numbers)

School Type (%)

Total

A state-run orstate-fundedschool– non-selective

A state-run orstate-fundedschool– selective on
academic, faithor other ground

Independent or
fee-paying
school

A state-run orstate-fundedschool– non-selective

A state-run orstate-fundedschool– selective on
academic, faithor other ground

Independent or
fee-paying
schoolContent
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

530
154
3,558
3,144
1,453
1,107

281
78
2,102
1,917
729
597

147
44
959
855
382
302

102
32
497
372
342
208

53.0
50.6
59.1
61.0
50.2
53.9

27.7
28.6
27.0
27.2
26.3
27.3

19.2
20.8
13.9
11.8
23.5
18.8

Division

UK Public Service

9,946

5,704

2,689

1,553

57.4

27.0

15.6

World Service GroupBBC Studios
Other

448
1,348
169

232
717
100

112
364
51

104
267
18

51.8
53.2
59.2

25.0
27.0
30.2

23.2
19.8
10.6

Grand Total

11,911

6,753

3,216

1,942

56.7

27.0

16.3

Leadership staff socio-economic background (school type) distribution by division: 31 March 2019
School Type (numbers)

School Type (%)

A state-run orstate-fundedschool– selective on
academic, faithor other ground

Independent or
fee-paying
school

A state-run orstate-fundedschool– non-selective

A state-run orstate-fundedschool– selective on
academic, faithor other ground

Independent or
fee-paying
school

22.9
26.5
19.1
13.2
34.5
23.0

Division

Total

A state-run orstate-fundedschool– non-selective

Content
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

131
49
711
402
264
178

68
25
399
236
115
94

33
11
176
113
58
43

30
13
136
53
91
41

51.9
51.0
56.1
58.7
43.5
52.8

25.2
22.5
24.8
28.1
22.0
24.2

UK Public Service

1,735

937

434

364

54.0

25.0

21.0

World Service GroupBBC Studios
Other

67
343
10

28
148
*

17
92
*

22
103
*

41.8
43.2
*

25.4
26.8
*

32.8
30.0
*

2,155

1,120

545

490

52.0

25.3

22.7

Grand Total

276

BBC Group Annual Report and Accounts 2018/19

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A D D I T I O N A L I N F O R M AT I O N

All staff socio-economic background (parental degree) distribution by division: 31 March 2019
Parental Degree (numbers)
Division

Parental Degree (%)

Total

No

Yes

No

Yes

Content
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

533
161
3,819
3,085
1,608
1,134

274
68
1,837
1,611
695
497

259
93
1,982
1,474
913
637

51.4
42.2
48.1
52.2
43.2
43.8

48.6
57.8
51.9
47.8
56.8
56.2

UK Public Service

10,340

4,982

5,358

48.2

51.8

World Service GroupBBC Studios
Other

701
1,412
160

255
602
82

446
810
78

36.4
42.6
51.2

63.6
57.4
48.8

12,613

5,921

6,692

46.9

53.1

Grand Total

Leadership staff socio-economic background (parental degree) distribution by division: 31 March 2019
Parental Degree (numbers)

Parental Degree (%)

Division

Total

No

Yes

No

Yes

Content
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

131
53
774
407
299
185

64
24
367
218
118
87

67
29
407
189
181
98

48.9
45.3
47.4
53.6
39.5
47.0

51.1
54.7
52.6
46.4
60.5
53.0

UK Public Service

1,849

878

971

47.5

52.5

World Service GroupBBC Studios
Other

97
380
*

30
161
*

67
219
*

30.9
42.4
*

69.1
57.6
*

2,334

1,073

1,261

46.0

54.0

Grand Total

All staff socio-economic background (parental occupation) distribution by division: 31 March 2019
Parental Occupation (numbers)

Total

Highermanagerial andprofessional
occupations

Intermediate
occupations

Content
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

537
158
3,820
3,070
1,575
1,100

334
111
2,251
1,748
1,052
724

UK Public Service

10,260World Service GroupBBC Studios
Other

681
1,386
162
12,489DivisionGrand Total

Parental Occupation (%)

Routine andmanualoccupations

Highermanagerial andprofessional
occupations

Intermediate
occupations

Routine andmanualoccupations

66
21
511
422
190
149

137
26
1,058
900
333
227

62.2
70.3
58.9
56.9
66.8
65.8

12.3
13.3
13.4
13.8
12.1
13.6

25.5
16.4
27.7
29.3
21.1
20.6

6,220

1,359

2,681

60.6

13.3

26.1

507
923
93

54
175
23

120
288
46

74.4
66.6
57.4

8.0
12.6
14.2

17.6
20.8
28.4

7,743

1,611

3,135

62.0

12.9

25.1

All staff data reflects UK-based employee contracts only.
Leadership is defined as Band E and above.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

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BBC Group Annual Report and Accounts 2018/19

277

E Q UA L I T Y I N F O R M AT I O N R E P O R T

Leadership staff socio-economic background (parental occupation) distribution by division: 31 March 2019
Parental Occupation (numbers)

Parental Occupation (%)

Division

Total

Highermanagerial andprofessional
occupations

Content
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

129
50
760
400
283
177

77
36
477
233
194
103

16
*
117
47
37
29

36
12
166
120
52
45

59.7
72.0
62.8
58.3
68.5
58.2

12.4
*
15.4
11.7
13.1
16.4

27.9
24.0
21.8
30.0
18.4
25.4

UK Public Service

1,799

1,120

248

431

62.2

13.8

24.0

World Service GroupBBC Studios
Other

95
374
*

70
257
*

12
40
*

13
77
*

73.7
68.7
*

12.6
10.7
*

13.7
20.6
*

2,277

1,453

301

523

63.8

13.2

23.0

Grand Total

Intermediate
occupations

Routine andmanualoccupations

Highermanagerial andprofessional
occupations

Intermediate
occupations

Routine andmanualoccupations

All staff socio-economic background (school type) distribution by Job Family: 31 March 2019
School Type (numbers)

School Type (%)

A state-run orstate-fundedschool– selective on
academic, faithor other ground

Independent or
fee-paying
school

A state-run orstate-fundedschool– non-selective

A state-run orstate-fundedschool– selective on
academic, faithor other ground

Independent or
fee-paying
schoolTotal

A state-run orstate-fundedschool– non-selective

Commissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

122
5,210
371
2,284
2,964
960

65
2,893
195
1,323
1,779
498

30
1,355
107
636
819
269

27
962
69
325
366
193

53.3
55.5
52.6
57.9
60.0
51.9

24.6
26.0
28.8
27.8
27.6
28.0

22.1
18.5
18.6
14.3
12.4
20.1

Grand Total

11,911

6,753

3,216

1,942

56.7

27.0

16.3

Job Family

Leadership staff socio-economic background (school type) distribution by Job Family: 31 March 2019
School Type (numbers)
A state-run orstate-fundedschool– selective on
academic, faithor other ground

School Type (%)

Independent or
fee-paying
school

A state-run orstate-fundedschool– non-selective

A state-run orstate-fundedschool– selective on
academic, faithor other ground

Independent or
fee-paying
schoolJob Family

Total

A state-run orstate-fundedschool– non-selective

Commissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

93
871
70
562
313
246

49
458
34
299
184
96

23
207
17
147
81
70

21
206
19
116
48
80

52.7
52.5
48.6
53.2
58.8
39.0

24.7
23.8
24.3
26.2
25.9
28.5

22.6
23.7
27.1
20.6
15.3
32.5

2,155

1,120

545

490

52.0

25.3

22.7

Grand Total

All staff socio-economic background (parental degree) distribution by Job Family: 31 March 2019
Parental Degree (numbers)
Job Family

Parental Degree (%)

Total

No

Yes

No

Yes

Commissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

123
5,536
406
2,369
3,139
1,040

60
2,490
169
1,226
1,538
438

63
3,046
237
1,143
1,601
602

48.8
45.0
41.6
51.8
49.0
42.1

51.2
55.0
58.4
48.2
51.0
57.9

Grand Total

12,613

5,921

6,692

46.9

53.1

278

BBC Group Annual Report and Accounts 2018/19

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A D D I T I O N A L I N F O R M AT I O N

Leadership staff socio-economic background (parental degree) distribution by Job Family: 31 March 2019
Parental Degree (numbers)

Parental Degree (%)

Job Family

Total

No

Yes

No

Yes

Commissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

94
939
75
600
343
283

45
428
36
289
154
121

49
511
39
311
189
162

47.9
45.6
48.0
48.2
44.9
42.8

52.1
54.4
52.0
51.8
55.1
57.2

2,334

1,073

1,261

46.0

54.0

Grand Total

All staff socio-economic background (parental occupation) distribution by Job Family: 31 March 2019
Parental Occupation (numbers)

Total

Highermanagerial andprofessional
occupations

Intermediate
occupations

Commissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

119
5,426
395
2,344
3,179
1,026

70
3,528
249
1,332
1,869
695

Grand Total

12,4897,743

Job Family

Parental Occupation (%)

Routine andmanualoccupations

Highermanagerial andprofessional
occupations

Intermediate
occupations

Routine andmanualoccupations

12
660
48
344
420
127

37
1,238
98
668
890
204

58.8
65.0
63.0
56.8
58.8
67.7

10.1
12.2
12.2
14.7
13.2
12.4

31.1
22.8
24.8
28.5
28.0
19.9

1,611

3,135

62.0

12.9

25.1

Leadership staff socio-economic background (parental occupation) distribution by Job Family: 31 March 2019
Parental Occupation (numbers)

Parental Occupation (%)

Job Family

Total

Highermanagerial andprofessional
occupations

Commissioning
Programming
Sales/Marketing
Support/Admin
Technical/Engineering
Not Allocated

91
912
74
585
337
278

54
580
49
363
214
193

*
116
*
82
54
32

28
216
17
140
69
53

59.3
63.6
66.2
62.1
63.5
69.4

*
12.7
*
14.0
16.0
11.5

30.8
23.7
23.0
23.9
20.5
19.1

2,277

1,453

301

523

63.8

13.2

23.0

Grand Total

Intermediate
occupations

Routine andmanualoccupations

Highermanagerial andprofessional
occupations

Intermediate
occupations

Routine andmanualoccupations

All staff socio-economic background (school type) distribution by grade band: 31 March 2019
School Type (numbers)

School Type (%)

Total

A state-run orstate-fundedschool– non-selective

A state-run orstate-fundedschool– selective on
academic, faithor other ground

Independent or
fee-paying
school

A state-run orstate-fundedschool– non-selective

A state-run orstate-fundedschool– selective on
academic, faithor other ground

Independent or
fee-paying
school

A
B
C
D
E
F
SL
Not Allocated

235
1,420
3,659
3,548
1,184
564
159
1,142

140
814
2,157
2,009
653
292
81
607

76
420
1,004
923
294
138
40
321

19
186
498
616
237
134
38
214

59.6
57.3
59.0
56.6
55.2
51.8
50.9
53.2

32.3
29.6
27.4
26.0
24.8
24.5
25.2
28.1

8.1
13.1
13.6
17.4
20.0
23.7
23.9
18.7

Grand Total

11,911

6,753

3,216

1,942

56.7

27.0

16.3

Grade band

All staff data reflects UK-based employee contracts only.
Leadership is defined as Band E and above.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

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BBC Group Annual Report and Accounts 2018/19

279

E Q UA L I T Y I N F O R M AT I O N R E P O R T

All staff socio-economic background (parental degree) distribution by grade band: 31 March 2019
Parental Degree (numbers)
Grade band

Parental Degree (%)

Total

No

Yes

No

Yes

A
B
C
D
E
F
SL
Not Allocated

233
1,424
3,876
3,804
1,281
596
173
1,226

140
738
1,838
1,741
592
283
76
513

93
686
2,038
2,063
689
313
97
713

60.1
51.8
47.4
45.8
46.2
47.5
43.9
41.8

39.9
48.2
52.6
54.2
53.8
52.5
56.1
58.2

Grand Total

12,613

5,921

6,692

46.9

53.1

All staff socio-economic background (parental occupation) distribution by grade band: 31 March 2019
Parental Occupation (numbers)

Parental Occupation (%)

Total

Highermanagerial andprofessional
occupations

A
B
C
D
E
F
SL
Not Allocated

222
1,427
3,850
3,788
1,245
588
164
1,205

112
804
2,380
2,379
787
374
98
809

36
221
465
471
160
76
31
151

74
402
1,005
938
298
138
35
245

50.5
56.3
61.8
62.8
63.2
63.6
59.8
67.2

16.2
15.5
12.1
12.4
12.9
12.9
18.9
12.5

33.3
28.2
26.1
24.8
23.9
23.5
21.3
20.3

Grand Total

12,489

7,743

1,611

3,135

62.0

12.9

25.1

Grade band

Intermediate
occupations

Routine andmanualoccupations

Highermanagerial andprofessional
occupations

Intermediate
occupations

Routine andmanualoccupations

All staff data reflects UK-based employee contracts only.
Leadership is defined as Band E and above.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

280

BBC Group Annual Report and Accounts 2018/19

Return to contents

A D D I T I O N A L I N F O R M AT I O NFreelance(reporting is shown separately for our staff and freelancers)
All staff age distribution by division: Freelance 2018/19
Age band (numbers)

Age band (%)

Division

Total

<20

20-29

30-39

40-49

50-59

60+

<20

20-29

30-39

40-49

50-59

60+

Content
Corporate, Policy& External Affairs
Deputy DirectorGeneral Group
Nations andRegions
News and Current
Affairs
Radio and
Education

693

*

197

187

184

100

25

*

28.4

27.0

26.6

14.4

3.6

48

*

*

*

14

12

15

*

*

*

29.2

25.0

31.2

829

*

149

224

218

160

73

*

18.0

27.0

26.3

19.3

8.8

2,979

72

886

564

603

482

372

2.4

29.7

18.9

20.3

16.2

12.5

1,207

*

314

319

260

193

117

*

26.0

26.5

21.5

16.0

9.7

1,593

*

489

399

324

235

139

*

30.7

25.0

20.4

14.8

8.7

UK Public
Service

7,349

88

2,036

1,699

1,603

1,182

741

1.2

27.7

23.1

21.8

16.1

10.1

World Service
Group
BBC Studios
Other

617
6,606
289

*
36
*

101
1,539
47

179
1,747
57

155
1,763
80

111
1,049
67

64
472
32

*
0.5
*

16.4
23.3
16.3

29.0
26.4
19.7

25.1
26.7
27.7

18.0
15.9
23.2

10.4
7.2
11.0

Grand Total

14,861

137

3,723

3,682

3,601

2,409

1,309

0.9

25.1

24.8

24.2

16.2

8.8

All staff disability distribution by division: Freelance 2018/19
Disability (numbers)
Division

Disability (%)

Total

Disabled

Not disabled

Disabled

Not disabled

Content
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

478
28
569
2,022
826
1,017

40
*
33
142
58
78

438
28
536
1,880
768
939

8.4
*
5.8
7.0
7.0
7.7

91.6
100.0
94.2
93.0
93.0
92.3

UK Public Service

4,940

351

4,589

7.1

92.9

World Service GroupBBC Studios
Other

445
3,783
174

19
231
10

426
3,552
164

4.3
6.1
5.7

95.7
93.9
94.3

Grand Total

9,342

611

8,731

6.5

93.5

All data reflects UK-based employee contracts only.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

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BBC Group Annual Report and Accounts 2018/19

281

E Q UA L I T Y I N F O R M AT I O N R E P O R T

All staff ethnicity distribution by division: Freelance 2018/19
Ethnicity band (numbers)

Ethnicity band (%)

Total

BAME

Other whitebackgroundContent
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

636
43
750
2,715
1,059
1,461

99
*
89
202
206
141

30
*
56
192
125
67

507
39
605
2,321
728
1,253

15.6
*
11.9
7.4
19.5
9.7

4.7
*
7.5
7.1
11.8
4.6

79.7
90.7
80.6
85.4
68.7
85.8

UK Public Service

6,664

740

471

5,453

11.1

7.1

81.8

World Service GroupBBC Studios
Other

542
5,873
264

260
469
27

47
323
16

235
5,081
221

48.0
8.0
10.2

8.7
5.5
6.1

43.4
86.5
83.7

Grand Total

13,343

1,496

857

10,990

11.2

6.4

82.4

Division

White UK

BAME

Other whitebackground

White UK

All staff gender distribution by division: Freelance 2018/19
Gender band (numbers)
Division

Gender band (%)

Total

FemaleMale

FemaleMale

Content
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

693
48
829
2,979
1,207
1,593

248
32
373
1,240
566
839

445
16
456
1,739
641
754

35.8
66.7
45.0
41.6
46.9
52.7

64.2
33.3
55.0
58.4
53.1
47.3

UK Public Service

7,349

3,298

4,051

44.9

55.1

World Service GroupBBC Studios
Other

617
6,606
289

310
2,850
83

307
3,756
206

50.2
43.1
28.7

49.8
56.9
71.3

Grand Total

14,861

6,541

8,320

44.0

56.0

All staff religion and belief distribution (numbers): Freelance 2018/19

Total

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
ExcludedContent
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

693
48
829
2,979
1,207
1,593

99
*
146
358
206
273

*
*
10
*
13
11

176
10
197
879
264
391

*
*
*
11
11
*

*
*
*
11
16
11

15
*
*
32
28
11

*
*
*
10
*
12

61
*
70
339
92
140

189
10
225
773
256
431

131
11
164
557
312
304

Division

UK Public Service

7,349

1,089

48

1,917

42

52

91

39

708

1,884

1,479

World Service GroupBBC Studios
Other

617
6,606
289

75
1,085
44

*
41
*

88
1,354
82

*
15
*

*
56
*

83
33
*

*
18
*

57
474
14

136
1,963
82

160
1,567
56

Grand Total

14,861

2,293

99

3,441

60

121

207

60

1,253

4,065

3,262

282

BBC Group Annual Report and Accounts 2018/19

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A D D I T I O N A L I N F O R M AT I O N

All staff religion and belief distribution (percentage): Freelance 2018/19

AtheistBuddhist

Christian

Hindu

JewishMuslim

Sikh

Other

None

Prefernot tosay/
ExcludedContent
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

14.3
*
17.6
12.0
17.1
17.1

*
*
1.2
*
1.1
0.7

25.4
20.8
23.8
29.5
21.9
24.5

*
*
*
0.4
0.9
*

*
*
*
0.4
1.3
0.7

2.2
*
*
1.1
2.3
0.7

*
*
*
0.3
*
0.8

8.8
*
8.4
11.4
7.6
8.8

27.2
20.8
27.2
25.9
21.2
27.1

18.9
22.9
19.8
18.7
25.9
19.1

UK Public Service

14.8

0.7

26.1

0.6

0.7

1.2

0.5

9.6

25.6

20.2

World Service GroupBBC Studios
Other

12.2
16.4
15.2

*
0.6
*

14.3
20.5
28.4

*
0.2
*

*
0.9
*

13.4
0.5
*

*
0.3
*

9.2
7.2
4.8

22.0
29.7
28.4

25.9
23.7
19.4

Grand Total

15.4

0.7

23.2

0.4

0.8

1.4

0.4

8.4

27.4

21.9

LGB

Division

All staff sexual orientation and gender identity distribution by division (numbers): Freelance 2018/19
Heterosexual/straight

Other

Prefernot tosay/
Excluded

Total

Bisexual

Gay manGaywoman/
lesbianContent
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

693
48
829
2,979
1,207
1,593

14
*
*
49
32
43

20
*
27
67
45
55

10
*
*
26
*
20

530
39
612
2,283
807
1,152

*
*
*
19
14
21

115
*
169
535
300
302

48
*
48
161
100
139

Division

UK Public Service

7,349

146

215

71

5,423

68

1,426

500

World Service GroupBBC Studios
Other

617
6,606
289

*
104
*

*
179
*

*
66
*

427
4,675
223

11
49
*

156
1,533
58

34
398
*

Grand Total

14,861

260

404

148

10,748

128

3,173

940

LGB

All staff sexual orientation and gender identity distribution by division (percentage): Freelance 2018/19
Heterosexual/straight

Other

Prefernot tosay/
Excluded

Bisexual

Gay manGaywoman/
lesbianContent
Corporate, Policy & External Affairs
Deputy Director-General Group
Nations and Regions
News and Current Affairs
Radio and Education

2.0
*
*
1.6
2.7
2.7

2.9
*
3.3
2.2
3.7
3.5

1.4
*
*
0.9
*
1.3

76.5
81.3
73.8
76.7
66.8
72.3

*
*
*
0.6
1.2
1.3

16.6
*
20.3
18.0
24.9
18.9

6.9
*
5.8
5.4
8.3
8.7

Division

UK Public Service

2.0

2.9

1.0

73.8

0.9

19.4

6.8

World Service GroupBBC Studios
Other

*
1.6
0.3

*
2.7
*

*
1.0
*

69.2
70.8
77.2

1.8
0.7
*

25.3
23.2
20.1

5.5
6.0
*

Grand Total

1.7

2.7

1.0

72.3

0.9

21.4

6.3

All data reflects UK-based employee contracts only.
Totals for each characteristic differ due to varying disclosure rates.
* Data has been replaced with an asterisk where figures are below sample size.

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BBC Group Annual Report and Accounts 2018/19

283

A D D I T I O N A L I N F O R M AT I O N

Index
Subject index

Page number

Audience accountability

64Awards06

BBC Global News Ltd

73

BBC Studios

68-72

BBC Studioworks

74

BBC World Service

48-54

Chairman’s message
Charitable work
Commercial Operations
Committee reports

08
62
66-75
100-110, 121-139

Content spend by service – by nation

40-47, 166-182

Content spend by service – network

41-47

Corporate compliance101

Developing our people

78, 80-81

Director-General’s statement
Diversity and inclusion
Efficiency savings

1034-45, 77, 80
94-95

Environmental sustainability

63

Equality Information Report

258

Financial statements

184

Human rights

82

Licence fee income and expenditure
Market context
Nations and regions

61, 88-95, 184
56-57
36-47, 166-183

Pay disclosures

111-120

Performance against public commitments

142-165

Public purposes

16-54

Reach by service

4, 18, 22, 24, 25, 27, 39, 41, 43, 45, 47, 52, 54, 56, 58, 59, 60

Remuneration – BBC Board

102-110

Remuneration – BBC senior managers

104

Risks and opportunities

127

Service performance
Severance pay
Staff – headcount and location
Talent costs
Time spent with each service

39, 41, 43, 45, 47, 58-60
85
37, 83-84
85
4, 27, 39, 41, 43, 45, 47, 52, 54, 56, 58-60

Trading fairly

138

Viability statement

132

284

BBC Group Annual Report and Accounts 2018/19

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A D D I T I O N A L I N F O R M AT I O N

Copyright and photographer credits
Front cover
Fleabag – BBC/Two Brothers/Luke Varley
Contents page
Dynasties – BBC NHU/Theo Webb
Killing Eve – BBC/Sid Gentle Films/Robert Viglasky
Zoe Ball – BBC/Sarah Jeynes
Pages 2-3
Bodyguard – BBC/World Productions/Des Willie
Page 4
BBC Sounds – BBC
BritBox – The names and logos shown are copyright theirrespective owners. All rights reserved
Killing Eve – BBC/Sid Gentle Films/Robert Viglasky
Page 5
BBC Scotland channel, The Nine – BBC/Alan Peebles
iPlayer – BBCWorld Cup – BBC/Jon Shard/Jon Enoch/Bryony Shearmur
Plastics Watch – BBC
Ben Hunte – BBC
Own It – BBC
Local News Partnership – BBCPage 6
Golden Globes, A Very English Scandal – BBC/Blueprint
Television LtdBAFTAs, Killing Eve – BBC/Sid Gentle Films/RobertViglasky
British Academy Children’s Awards, Justin Fletcher – BBC
National Television Awards, Danny Dyer – BBC/Kieron
McCarron
Page 7BAFTA Craft Awards, Dynasties – BBC NHU

Page 29
Soon Gone: A Windrush Chronicle – BBC/Douglas Road
Productions/Carlton Dixon
Page 30
Mrs Wilson – BBC/WP Films Ltd/Peter Marley
Page 31
Podcasts – BBCPage 32
European Athletics Indoor Championships –Ian MacNicol/Getty Images
Page 33
Our Classical Century – BBC/Lion TV
The Biggest Weekend – BBC/Emma Gibbs
Pages 34-35
Informer – BBC/Neal Street Productions/Colin Hutton
Pages 36-37
Line of Duty – BBC/World Productions/Peter Marley
Page 40
To Provide All People – BBC/Vox Pictures/Rory Taylor
Page 42
Still Game – BBC/Alan Peebles
Page 44
Death and Nightingales – BBC/Night Flight Pictures Ltd
2018/Helen Sloan
Page 46
Local Radio presenters – BBC
Pages 48-49
Beyond Fake News event – BBCPage 50
Anatomy of a Killing – BBCPage 51
The She Word – BBC

ARIAs, You, Me and the Big C – BBC/Clare Wood

Page 52
BBC Nairobi studio – BBC/Armstrong Too

RTS Television Journalism Awards, Emily Maitlis – BBC/Phil Coomes

Page 55
Zoe Ball – BBC/Sarah Jeynes

Grierson Awards, Stephen: The Murder That Changed A
Nation – BBC/On The Corner/Jessica Winteringham

Page 62
Rickshaw Challenge – CiN/Guy Levy

RTS Programme Awards, Drowning in Plastic – BBC/Raw
TV Ltd/Alisdair Livingstone

Page 65
Salford session – BBC/Lee McLean

Page 8Sir David Clementi – BBC/Emma Lynch

Tower Hamlets session – BBC/Phil Coomes

Page 9Strictly Come Dancing – BBC/Guy Levy

Pages 66-67
Dynasties – BBC NHU/Theo Webb

Page 10
Tony Hall – BBCPage 12
BBC Sounds – BBC
BBC iPlayer – BBCPage 14
Still Game – BBC/Alan Peebles
Page 15
Brexitcast – BBC/Guy Levy
Page 17
Politics Live – BBC/Jeff Overs
Thumbelina – BBC/Ben Blackall
Killing Eve – BBC/Sid Gentle Films/Robert Viglasky
Informer – BBC/Neal Street Productions/Colin Hutton
Beyond Fake News event – BBC
Pages 18-19
Politics Live – BBC/Jeff Overs
Page 20David Dimbleby – BBC/Mentorn TV/Richard Lewisohn
Fiona Bruce – BBC/Richard Lewisohn
Page 21
BBC Parliament – BBC
Pages 22-23
Thumbelina – BBC/Ben Blackall
Page 24
The CBBC Summer Social – BBC/Tracey Welch
Page 25
Get Creative – BBC
Pages 26-27
Killing Eve – BBC/Sid Gentle Films/Robert Viglasky
Page 28
Royal Wedding – Ben Stansall/AFP/Getty Images
Professor Margaret MacMillan – BBC/Richard Ansett

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Margate session – BBC/Lily Bungay

Page 69
Luther – BBC/Des Willie
Doctor Who – BBC Studios/Sophie Mutevelian
Top Gear – Geoff Pugh/Shutterstock
Page 72
This Country – BBC/Ian Weldon
Page 73
Impact – BBCPage 74
The Graham Norton Show – BBC/Christopher Baines
Page 76
BBC staff member – BBCPage 78
Shiromi Ramanayake – BBCPage 79
BBC staff – BBCPage 87
Les Misérables – BBC/Lookout Point/Laurence
Cendrowicz
Page 88
Glyn Isherwood – BBC/Emma Lynch
Page 94
CGI of Cardiff Central Square – Fosters + Partners
Pages 96-97
Strictly Come Dancing – BBC/Guy Levy
Pages 98-99
BBC Board – BBC/Emma Lynch
Page 142
Clara Amfo – BBC/Sarah Jeynes
Page 166
Doctor Who – BBC Studios/Coco Van Oppens
Page 184
Louis Theroux’s Altered States – BBC/Bryony Shearmur
Page 258
BBC staff – BBC

BBC Group Annual Report and Accounts 2018/19

285

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