BBC 'overspends' on new building projects

The BBC's Salford facility is expected to be completed under budget

The BBC has been criticised for facing "serious difficulties" over its programme of major new building works.

The extension of Broadcasting House has cost £100m more than planned and was due for completion in 2008, a National Audit Office report found.

It added the project has suffered from "weak governance", while the BBC's Salford centre is set to be completed around £76m under budget.

BBC Trustee Jeremy Peat admitted that licence fee payers were "let down".

'Room for improvement'

The BBC is expected to carry out an imminent check on all its projects in the wake of the report.

It was commissioned by the BBC Trust, which is in place to ensure that value for money is delivered, and concluded the three building projects have failed to do so.

Mr Peat admitted that "serious mistakes" had been made in the early part of the Broadcasting House project.

"But there is still considerable room for improvement, and consequently we will follow up the National Audit Office's recommendations vigorously and as a matter of urgency," he added.

The corporation is spending £2bn over a long term period on its new facilities.

The new broadcasting centre at Pacific Quay in Glasgow went over budget by £62m and faced a year's delay.

The report recommended that for future projects "proposals submitted by management are reliable and subject to effective challenge by the BBC Trust".

It also revealed that the Broadcasting House project based around the existing building in central London faced problems from the outset after a dispute with the developer cost £45m to resolve.

The Pacific Quay project, which cost £188m, ran into delays.

It had been originally budgeted at £126m, although this was revised upwards when the BBC opted for a bigger building and more advanced technology.

The report added that the BBC's management of the three major projects had subsequently improved.

BBC Director general Mark Thompson is expected to report his findings on the ongoing projects to the trust in the next month.

COST AND STATUS OF BBC ESTATE PROJECTS

	Original budget	Final cost/Current forecast	Operational (target)
Pacific Quay, Glasgow
	£125.6m (May 2002)	£188.1m (final cost)	Jul 2007 (June 06)
Salford Quays, Manchester
	£953m (Dec 2006)	£877m (forecast)	Dec 2011 (Dec 2011)
Broadcasting House, London
	£991m (July 2003)	£1,046m (forecast)	Apr 2013 (Dec 2008)

SOURCE: NAO