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New York Times CEO Will Face Parliament Over BBC Pay Packages

New York Times CEO Mark Thompson
A file photo shows New York Times Co. Chief Executive Officer Mark Thompson, then director general of the British Broadcasting Corp., on the second day of the e-G8 Internet Forum in Paris, on May 25, 2011. Photographer: Antoine Antoniol/Bloomberg

Former British Broadcasting Corp. Director General Mark Thompson, who now serves as chief executive officer of New York Times Co., will appear before Parliament next week to address criticism that the BBC paid excessive severance to two former managers.

Thompson, who left the U.K.’s publicly funded television and radio service a year ago to take the Times job, will face questions over whether the exit packages were vetted by the authorities. In a statement to Parliament ahead of the Sept. 9 appearance, Thompson said the BBC Trust governing body was aware of the payments, disputing claims made by the organization.

“They were fully informed in advance about the proposed settlements to these two managers, and had every opportunity to intervene had they so chosen,” Thompson said in a separate e-mailed statement. “I look forward to giving evidence to the committee next Monday.”

At dispute are the level of severance payments made to Mark Byford, a deputy director general, and Sharon Baylay, a marketing executive. Byford was paid about 1 million pounds ($1.6 million), while Baylay received 394,000 pounds. Thompson will join former and current BBC officials at the hearing to discuss the payouts to the managers, who left the BBC in 2010.

The U.K.’s government-spending watchdog in July said the BBC broke rules on severance payments in spending 25 million pounds over three years to cut top jobs, paying some managers more than they were entitled -- either to keep them as consultants or ensure they left quickly. The BBC handed out 150 severance packages over three years ending in December 2012.

Insufficient Evidence

The Metropolitan Police Service said last month that its Economic Crime office hadn’t found enough “evidence of dishonesty or criminal misconduct” to warrant an investigation.

The BBC is funded by U.K. residents through an annual license fee charged to households that own televisions. The current fee is 145.50 pounds for a color TV license.

The BBC’s severance policies drew increased scrutiny after former Director General George Entwistle received 450,000 pounds, more than twice his contracted entitlement, when he quit less than two months into the job in November. Entwistle stepped down after a television report by the BBC’s “Newsnight” program falsely implicated a former senior politician with sexual abuse of a child.

The shakeup followed a period of cost-cutting under Thompson, who shed jobs in a bid to streamline the BBC and pare expenses. While the cuts ultimately saved 35 million pounds over a three-year period -- more than they cost -- the severance payoffs “provided poor value for money for license fee payers,” according an auditor’s report from July.

“The level of some of these payments was wrong,” current BBC Director General Tony Hall said in a statement after the auditor’s report was released. “The BBC lost its way on payments in recent years.”

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