Mark Thompson plans to save $632 mil by 2017

BBC director-general Mark Thompson has indicated that he will make deeper cuts than initially anticipated, following last year’s new license fee deal agreed with the coalition government.

Outlining details of a six-month consultation, in which staff will be asked to put forward ideas for economies, the topper said that he wanted to achieve extra cost savings of 20% — about £400 million ($632 million) — by April 2017.

However, Thompson reiterated that none of the BBC’s core services will be cut, despite speculation that digital channels BBC 3 and 4 could be axed.

Originally, cuts to the tune of 16% were envisaged after the government froze the license fee paid by all TV-owning households at $230 a year until 2017. The pubcaster must also pick up the tab for services the government presently funds, such as the cost of running the World Service and Welsh-language web S4C.

Thompson told staff that deeper savings were necessary to free up coin for investment in new technology and content. Significantly, programming and content costs will be cut by 20%, with half the coin coming from efficiency savings and half from “doing less,” he said.

Among savings already identified are trimming the senior management pay bill by 25% by this December and reducing online spend by 25%.

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