BBC’s outsourcing policy under spotlight
- Reduce text size Decrease text size
- Increase text size Increase text size
- Print article Print
- Jump to comments Comment
- Share this article Share
- Email article to a friend Email
The BBC disappoints as cost-savings fall short of predictions. ...
The BBC’s outsourcing deal with IT services provider Siemens Business Services (SBS) has come under scrutiny from MPs after it emerged that the broadcaster vastly over-estimated the cost savings to be made from the £1.5 billion 10-year contract signed in 2004.
BBC chiefs originally guaranteed parliament that the deal would deliver £35.2 million in cost-savings annually. But a recent report from parliamentary spending watchdog the Public Accounts Committee has found that the first year of the contract yielded only £22 million of cost-savings, representing a shortfall of 38%.
Under the terms of the deal the BBC agreed to replace the services supplied by its commercial subsidiary BBC Technology with those of SBS.
Edward Leigh, chairman of the Public Accounts Committee said in a statement on Thursday: “The BBC’s approach to the contract has been distinctly second rate. Its estimates of annual profits have fluctuated widely; many parts of the BBC are still using other suppliers, and there was no provision for the BBC to share profits on an agreed level.”
Leigh said that these latest findings are likely to provoke further scrutiny into the BBC’s handling of outsourcing contracts: “None of this inspires confidence in the BBC’s ability to negotiate and manage large-scale contracts,” he commented.
Further reading
