BBC has had annus horribilis, says culture secretary

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Media captionMaria Miller: "I'll be keeping the governance of the BBC under close review"

The BBC has had an "annus horribilis" after several controversies but it will bounce back, Culture Secretary Maria Miller has said.

Speaking at a Royal Television Society convention, she said the role of the National Audit Office in holding the BBC to account had to be strengthened.

She wants the public spending watchdog to have greater access to the BBC.

The BBC has announced a review of its structure to provide better oversight of the way the licence fee is spent.

Annus horribilis is a Latin phrase, meaning "horrible year", and came to prominence after a speech by the Queen in 1992.

'Insufficient independence'

Ms Miller's speech to an audience of industry insiders in Cambridge comes after a difficult week for the BBC.

On Monday, seven former and current BBC bosses were grilled by members of the Commons spending watchdog about their handling of large pay-offs.

The BBC has been criticised for paying £25m to 150 outgoing executives - £2m more than their contracts stipulated - between 2009 and 2012.

Ms Miller described it as "a grim day for its senior management".

She said criticism of the BBC Trust - the corporation's governing body - was similar to that previously aimed at BBC governors, which it replaced in 2007.

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Media captionTony Hall: "I have absolute confidence we can make the system work well"

"This criticism focused on insufficient independence and a lack of clarity over the separation of roles. Does that sound familiar?" she said.

The BBC has recently introduced a £150,000 cap on severance pay and Ms Miller recognised that changes had been made by new director general Tony Hall.

"I will continue to keep the BBC's structures and effectiveness under review," she said.

"Ultimately, licence fee payers rely not only upon the right structures and governance being in place but also upon the BBC's executive management using their good judgment. And I think serious questions were raised about that judgement by the scale of the severance payments made."

An NAO report, published in July, into severance packages at the corporation found "weak governance arrangements have led to payments that exceeded contractual entitlements and put public trust at risk".

Ms Miller said the NAO's work had been "pivotal in bringing issues to light" and criticised the fact it was stopped from "immediately looking" at the pay-off package for former director general George Entwistle, who left the BBC in November 2012 in the wake of the Jimmy Savile scandal.

She said: "I want a system where the NAO can look at any area of concern without hindrance or delay."

In the last two years, the auditors have had greater freedom to deal with the BBC but still have to agree subjects in advance with the corporation and do not have the flexibility to react to events.

In conclusion, she said: "This has been an annus horribilis for the BBC. But we all know that institutions can recover and come back stronger from years like that. The BBC will bounce back."

Responding to the speech, BBC director general Tony Hall said: "It's not been a great week for the BBC, I would completely agree".

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Media captionLord Patten: "BBC has a culture of over-paying"

"Those of us who... love the BBC are, of course, saddened by what's happened over the last six months, and even more."

He said the "audience would expect" the BBC and the BBC Trust to "sort out" their relationship.

"And then we can turn a corner and concentrate on what people really want from us, which is great programmes."

Lord Hall, who took up his post in April, added: "We have nothing to fear from the NAO - but it's unclear to me yet quite what is planned."

A BBC Trust spokeswoman said: "We have done a great deal to strengthen our relationship with the NAO in the last two years and to make the current arrangements work to the benefit of licence fee payers."

The BBC said a review of how the Trust and the executive work will try to "simplify the relationship and provide better and clearer oversight of the way the licence fee is spent".

In a letter to Ms Miller, Lord Hall and Trust chairman Lord Patten said the review, which they aim to publish this year, would show they "could make an improvement in the way that the BBC is run and managed, and to ensure a primary focus on what audiences want and need and how we spend their money".

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