BBC criticised over contract system

A cross-party committee of MPs said it was “shocked” to discover the scale of BBC employees who pay no tax or national insurance at source.

The BBC provided information relating to 25,000 staff that are employed using off-payroll contracts to the Public Accounts Committee (PAC).

The chairwoman of the PAC, Margaret Hodge, said that the method used implied “suspicions of complicity in tax avoidance”. Although the BBC is now conducting a thorough review of the practice, in response to the PAC inquiry it said that the off-payroll agreements are “a pretty standard model” in the media sector.

Approximately 13,000 employees who are paid directly are on-air staff with the other 12,000 not appearing directly on radio or television. Perhaps most worrying was the identification of 3,000 individuals who are paid via a private company, which may allow the limitation of tax liabilities.

Concerns over the practice were triggered by the recent disclosure that Ed Lester, the boss of the Student Loans Company, was employed using a private company and therefore contributed no tax at source.

A further investigation by the Treasury revealed over 2,400 staff at Whitehall had similar agreements in place.

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