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Last Updated: Tuesday, 15 July, 2003, 17:13 GMT 18:13 UK
BBC accused of 'Enron complacency'
BBC chairman Gavyn Davies
The BBC chairman said: "The BBC has had a very strong year"
The BBC has been accused of "Enron-like" complacency on the day it releases its annual report and accounts.

The corporation came under fire from a Parliamentary select committee, when Labour MP Chris Bryant said: "This feels more like a kind of Enron annual report than a BBC annual report."

Director general Greg Dyke demanded an apology, branding Mr Bryant "disgraceful" for comparing the BBC with a "corrupt financial organisation".

Later, BBC chairman Gavyn Davies said Mr Bryant had written to apologoise for the reference, which had "pretty annoyed" the corporation.

Mr Davies told BBC News Online: "To call, of all things, a report and accounts about the financial performance of the BBC over the last 12 months in any way analogous to what Enron's accounts were - which were fraudulent documents, deliberately fraudulent - is just absurd."

The BBC's report revealed a net debt of 74m but an increase of 346m in spending on programmes.

Greg Dyke
Enron was a corrupt financially-managed business - that's what you're implying
Greg Dyke
BBC director general
It said the debt was forecast three years ago when the corporation began its huge digital expansion plans - and it aims to break even by 2006.

In the committee hearing, Mr Bryant, a former BBC executive, said the only criticism its governors mentioned in an assessment of annual performance was about the failure to attract ethnic minority viewers.

"It's fundamentally complacent. At what point would you want to advance any criticism of the BBC at all?" Mr Bryant asked.

Mr Dyke said: "Can I say how deeply we resent the use of the word Enron. Enron was a corrupt financially-managed business. That's what you're implying."

Mr Bryant said he was "happy to apologise for any imputation of anybody being financially corrupt".

Walking With Cavemen
Shows like the Walking With... series were praised by the BBC
The BBC chairman told him the BBC presented an upbeat report because he believed the corporation had had a very strong year.

But "there are a large number of things where we make it clear there is further work to do", he said after further questioning.

"We've done a great deal on arts but we've got more to go and we can do better.

Comparatively not bad value!
Matt, UK

"And the digital services can co-operate better to serve the licence-payers."

The annual report details the corporation's performance during the last 12 months, including finances and programme successes and failures.

Money spent on programmes was up more than a third on 2000, it said.

Meanwhile, overheads were slashed from 24% of its total spending three years ago to 13%.

The licence fee, which provides more than 94% of BBC funding, brought in a total of 2.659bn in 12 months.

And the BBC's most senior executives received lower bonuses than last year, despite what the report called the broadcaster's "strong performance".

Mr Dyke was paid 464,000 including an 88,000 bonus - down 5,000 from last year.

BBC Broadcasting House
How long is it viable for the BBC, as it goes on shrinking... to go on arguing that it has the right to be funded by a tax?
Gerald Kaufman MP
Committee chairman
But committee chairman Gerald Kaufman MP accused the governors of being "utterly gushing" in their assessment of the last year.

He questioned how long the BBC could go on arguing that it should be funded by "a tax" as it "goes on shrinking, as it is shrinking and will shrink".

The corporation has also been under political scrutiny following its public row with 10 Downing Street over a BBC story that claimed the prime minister's office "sexed up" a dossier on Iraqi weapons.

Mr Kaufman said the BBC should sack Andrew Gilligan, the reporter who prompted the Iraq weapons row.

He added that Mr Gilligan and other journalists should be sacked for writing what he called "contentious" articles for the newspapers.

BBC Chairman, Gavyn Davies answered your questions

In a robust defence of the BBC's journalistic integrity, Mr Dyke said "news, broadcast impartially and independently" were at the heart of its public service remit.

The Foreign Affairs Committee recently cleared Downing Street director of communications Alastair Campbell of "sexing up" the dossier, but said the "jury was still out" over the case for war.

Mr Kaufman said the BBC was "not very honest" for claiming in one part of the report that BBC News 24 was watched by 70% of the population - and at another point that it had a 0.4% share of viewing figures.

Last week the broadcaster admitted its pension scheme was more than 1bn in deficit when calculated using strict new accounting standards - but insisted payouts would not be affected.

The BBC's Shaun Ley
"Greg Dyke may not have expected this description from a Labour MP"

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