Easy to be hard ?

At last, Mark Thompson has given us some hard figures on savings he'll make to meet the new six-year licence fee deal.   He tells Dan Sabbagh in The Guardian today he's already identified £330m a year of "efficiencies", which may surprise his loyal staff.  So let's see where they fall.

It's clear he's relying a lot on reducing the costs of licence-fee collection and hoping for increases in the number of households to chase (as we've said here before).  But it isn't going to happen fast. "Project Lion" is still recruiting and there's a whole bundle of contracts to replace. Collection costs are running at around £120m; that's around 3.4% of the £3,500m a year income.  On trend, you might you might get income up to £3,600m next year, and reduce costs to 3.3%, giving Thommo an extra £102m.   (There might be more savings to be had - when you add the BBC costs of dealing with evasion, making those occasionally frightening ads and running the contracts, 8.7% of the total fees collected are used up)

Mark says he's cutting spending on online by a quarter (currently estimated at £200m a year). So that's £50m. There is a rumour that he's being even more aggressive with the wider Huggers' empire of FM&T and looking for a total cut of £70m.  US imports and sport are also apparently in the firing line.  American programming runs at around £100m, and is too useful to cut altogether, so let's say £50m.  Sport has already reduced expenditure, by either losing rights or not bidding, and might make some savings in the move to Salford Quays next year.  It's annual budget is around £400m.  Let's guess at 5% - £20m.

Then there's the move of News and World Service into Broadcasting House, planned for 2012. Thommo's view is that will produce savings - "however well-resourced the BBC is, we cannot afford to run two global news operations" - but not surely, enough to cover the whole of the World Service bill, coming the BBC's way in 2014 ?

OK, let's see where we are, and what's missing...
Licence fee changes £102m
FM&T/online            £70m
US imports                £50m
Sport                         £20m

That would leave £88m to be found from Vision, Audio & Music, Journalism/News, Finance, and Business Operations.  3% off their total budgets should more than do it.   However, there is, as we've pointed out, a deficit still to sort out, and the small matter of rising costs...