Government suggests BBC Worldwide sale

Wednesday, December 9 2009, 12:30 GMT

By Andrew Laughlin,

The government has included BBC Worldwide in a list of assets for sale and encouraged the BBC to achieve a "greater financial and operational separation" in the future.

In Annex C of the Operational Efficiency Programme: Asset Portfolio report, ministers discuss a "sale or partial sale" of the commercial body, which is wholly owned by the BBC.

The government acknowledged that the BBC has recently published a wide-ranging review of the Worldwide operation, including its "mandate, strategy and governance" within the current ownership structure.

However, the report also called on the BBC to "look more widely at the options for greater financial and operational separation", including the potential privatisation of Worldwide, which has an annual turnover of £1 billion.

The BBC remains publically committed to retaining ownership of Worldwide, but director general Mark Thompson admitted in September that this could change in the future.

"The government continues to encourage the BBC Trust to consider proposals to achieve greater separation, which could include the sale of a part of BBC Worldwide, while maintaining the rationale for the 'first-look agreement' and protecting the quality of the BBC brand around the world," said the report.

"The BBC has recently set out the conclusions of its review into the mandate, strategy and governance arrangements for BBC Worldwide within its current ownership structure. The government now expects the BBC to look more widely at the options for greater financial and operational separation, including a sale or partial sale.

"Alternatives to sale or partial sale might also include other structures that would potentially enable the introduction of external capital, broadening ownership of the asset and yet retaining the link to the BBC. Any ownership or alternative commercial options for the business would need to be considered in this context."

Last month, the BBC Trust clamped down on Worldwide's commercial activity following an 18-month review of the organisation.

Despite ruling that Worldwide can retain its controversial majority ownership of publisher Lonely Planet, the Trust said that it should only mount similar commercial deals in the future under "exceptional circumstances".

The Trust also recently introduced a series of structural management changes to create a much clearer dividing line between the BBC Executive and Worldwide. Towards the aim, BBC director of Vision Jana Bennett stepped down from her position on the Worldwide board to negate any potential "conflicts of interest".