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BBC paid out £25.6 million in severance payments in last financial year

The BBC has paid out £25.6 million in severance payments in the last financial year despite attempts to tighten the belt at the corporation.

The broadcaster has been criticised in the past for excessive payouts, including £949,000 for deputy director-general Mark Byford, £680,000 for former chief operating officer Caroline Thomson and £470,000 for George Entwistle when he resigned as director-general.

It has managed to cut its payments, from £40.2 million in 2012/13, to £25.6 million in 2013/14.

Fiona Reynolds, senior independent director, said that, although there had been a "steadily declining level of severance pay"...."payments in some cases are still significant".

The BBC annual report shows that a total of £3.6 million was made in severance payments to 22 senior management staff in 2013/14. But that was down on the £5.06 million for 2012/13.

A policy now caps pay-offs at £150,000.

But 12 payments were made above £150,000 - down from 23 in 2012/13 - in the period before the cap came into place.

The number of total severance payments decreased from 793 in 2012/13 to 413 in 2013/14.

Acting BBC Trust chairman Diane Coyle said the BBC fell short of licence fee-payers' expectations with its hefty payments to some former staff.

She said that there had been successes, highlighting shows like Call The Midwife and Rev, and saying that the BBC had "found its feet" after a "bruising period".

She added: "The BBC executive has made good progress on its priorities for the past 12 months, and we are expecting further progress in the next year on areas including... the variety and originality of programmes, value for money and serving an increasingly diverse UK."

But she added: "There have also been some high-profile failures.

"The BBC's Digital Media Initiative project was closed at a cost of nearly £100 million.

"And there was the controversy surrounding past severance payments...

"Both of these episodes involved significant sums of public money and saw the BBC falling well short of what licence fee-payers expect."

The broadcaster's annual report showed that the amount paid to its top stars was slashed by more than £6 million last year.

The corporation had been heavily criticised for the amount it pays its top talent, with presenters including Jeremy Clarkson and Graham Norton reportedly among its biggest earners.

The number of senior managers was cut by 8% last year, while the number of top earners on salaries of more than £100,000 fell for the fourth consecutive year.

The BBC said it is "delivering on its commitments", with popular shows such as Sherlock and Happy Valley, despite an effective 26% reduction in funds available for BBC services over six years following a licence fee freeze and new commitments given to the BBC such as part-funding the superfast broadband roll-out.

BBC director-general Tony Hall is also pledging a 4% increase in spending on content and delivery over the next three years.

Last week BBC News announced plans to axe 415 posts to save £48 million a year by 2016/17. The cuts will be offset by around 195 new roles, meaning a net reduction of 220 jobs.

The report also showed that "audience appreciation" has decreased for BBC 1, BBC 2, BBC 3 and BBC 4.

Audience appreciation of BBC television has fallen slightly for the first time in a number of years, to 82.1%.

The BBC defended the fall at a press conference, saying that it was because it had done so well the previous year with the London Olympics, the European Championship and the Diamond Jubilee.

Danny Cohen, director of television, added: "There's no doubt if you take 26% of your spending out, you are going to have an impact on how people feel about things.

"But I feel very, very confident in the quality of what we are doing, in its distinctiveness, and I feel very confident that the overall appreciation of our channels will grow."

The BBC had achieved a £27.7 million annual reduction to the senior manager pay bill.

Through redundancies, it said it had achieved cumulative savings of more than £55 million between 2009 and 2014, set to reach £111 million by the end of 2017.

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