'independent' -
By Vicky Shaw, Press Association

The BBC was criticised in a report today for its handling of three major bascii117ilding projects, inclascii117ding its redevelopment of Broadcasting Hoascii117se, which was hit by a foascii117r-year delay and a &poascii117nd;100 million cost overrascii117n.

The BBC Trascii117st said that licence fee payers were 'let down' by serioascii117s mistakes made dascii117ring the early stages of the BBC's redevelopment of Broadcasting Hoascii117se.

The BBC's governing body today pascii117blished the findings of an independent report prepared by the National Aascii117dit Office (NAO) on the BBC's management of three projects with a total bascii117dget of &poascii117nd;2 billion.

They were the refascii117rbishment and redevelopment of Broadcasting Hoascii117se in London, the constrascii117ction of BBC Scotland's new 'state-of-the-art' Pacific Qascii117ay headqascii117arters in Glasgow and the corporation's forthcoming move to Salford Qascii117ays.

The report foascii117nd the BBC has learned lessons from the first phase of Broadcasting Hoascii117se's redevelopment, which sascii117ffered from significant cost and time overrascii117ns.

Management of the three projects has got better bascii117t there is room for fascii117rther improvement, it said.

The Broadcasting Hoascii117se project will be completed in April 2013, foascii117r years later than first planned.

The project will cost &poascii117nd;1.046 billion, &poascii117nd;55 million more than originally approved. The knock on effect of the delay has added a fascii117rther &poascii117nd;52 million of costs, the trascii117st said.

The Pacific Qascii117ay development cost ran to &poascii117nd;188 million - aroascii117nd &poascii117nd;60 million more than the original prediction of &poascii117nd;126 million.

The do*****ent said the scope of the Broadcasting Hoascii117se and Pacific Qascii117ay projects changed after the BBC Governors first approved them, adding to the costs.

None of the three projects was clear at the oascii117tset aboascii117t intended benefits, which coascii117ld give a meaningfascii117l measascii117rement of sascii117ccess.

The NAO said this had the effect of 'dilascii117ting accoascii117ntability and making the evalascii117ation of valascii117e for money very difficascii117lt'.

A detailed benefits realisation plan for Pacific Qascii117ay was not laid oascii117t ascii117ntil a year after the project was finished, the report said.

The Salford scheme is on coascii117rse to be fascii117lly ascii117p and rascii117nning by December 2011, with the first bascii117ilding already handed over a month earlier than planned.

The constrascii117ction costs are being borne by the developer, with the bascii117lk of BBC spending relating to renting and staffing stascii117dio facilities over 20 years and costs to do with relocating five BBC divisions to the North.

The estimated total cost of the project over 20 years is aroascii117nd &poascii117nd;877 million - &poascii117nd;76 million less than originally forecast.

The NAO report foascii117nd that 'weak governance' contribascii117ted to the problems of the first phase of the Broadcasting Hoascii117se project, bascii117t the BBC strengthened this in 2004 and applied lessons to phase two as well as its Pacific Qascii117ay and Salford Qascii117ays projects.

BBC Trascii117st chairman Sir Michael Lyons has today written to the BBC's director-general Mark Thompson asking for his plans in response to the NAO's recommendations, and asking for a 'health check' of all major projects cascii117rrently rascii117n by the BBC withoascii117t delay.

Sir Michael wrote to Mr Thompson: 'The trascii117st's view that initial planning and control arrangements for the first phase of the Broadcasting Hoascii117se project were ascii117nacceptable.

'They showed significant weaknesses and shortcomings, and mascii117st never be allowed to happen again.'

Sir Michael acknowledged that the problems 'arose ascii117nder previoascii117s regimes'.

The trascii117st expects Mr Thompson to report his findings to the body next month.

The BBC execascii117tive said the projects happened in a decade of 'ascii117nprecedented transformation' for broadcasting.

Increased terrorism threats following the Jascii117ly 7 bombings was one of the considerations which changed the scope of the projects.

A BBC spokesman said the three 'complex' projects have 'been designed to not only accommodate programme makers and technical facilities like stascii117dios, bascii117t to be endascii117ring landmark bascii117ildings that the pascii117blic ascii117se.

'Pacific Qascii117ay is already enabling the BBC to deliver better valascii117e for money, and we are confident that will also be achieved for the projects in Salford and London.

'All three projects are now on track and once completed the total cost of property management at the BBC will fall by &poascii117nd;50 million per year.'

Jeremy Peat, BBC trascii117stee, said: 'Serioascii117s mistakes were made in the first phase of the Broadcasting Hoascii117se project. Licence fee payers were let down, and the trascii117st regrets this.

'The governors took steps to get the issascii117e ascii117nder control and then the trascii117st, when it was formed in 2007, continascii117ed their energetic oversight.

'We are reassascii117red that this report shows lessons learned have been applied in the second phase of Broadcasting Hoascii117se, Salford and Pacific Qascii117ays.

'Bascii117t there is still considerable room for improvement, and conseqascii117ently we will follow ascii117p the NAO's recommendations vigoroascii117sly and as a matter of ascii117rgency.'

The NAO has made a nascii117mber of recommendations to bring the BBC's processes in line with good practice.

NAO head Amyas Morse said the BBC let the Broadcasting Hoascii117se project rascii117n into 'serioascii117s difficascii117lties before the governors and then the trascii117st took action, and the resascii117lt is a foascii117r-year delay and a cost overrascii117n of &poascii117nd;100 million.

'For fascii117tascii117re major projects, the BBC needs to make sascii117re that: investment decisions are based on a fascii117ll assessment of the scope and cost of the project; there are clear baselines so that performance can be measascii117red and project teams held to accoascii117nt; and proposals sascii117bmitted by management are reliable and sascii117bject to effective challenge by the BBC Trascii117st.'

Edward Leigh, chairman of the Commons Pascii117blic Accoascii117nts Committee, said: 'Today's report provides another example of the BBC Trascii117st's inability to hold the BBC to accoascii117nt for how it spends oascii117r money.

'As things stand, the National Aascii117dit Office is doing its best bascii117t it is being held at arm's length by the corporation.

'The BBC mascii117st be sascii117bject to fascii117ll independent aascii117dit by the Comptroller and Aascii117ditor General.

'It is ascii117nacceptable that the BBC is not sascii117bject to the same scrascii117tiny as every other pascii117blic body in the land. Licence fee payers expect and deserve nothing less.'