A report by MPs accuses the BBC of a "cavalier" attitude towards licence fee money over a 450,000 payoff to director general George Entwistle, in the wake of the corporation's Jimmy Savile crisis.

MPs criticise BBC for Entwistle payout (G)

In its report published on Thursday, the public accounts committee said that "public servants should not be rewarded for failure".

Mr Entwistle resigned after just 54 days in the job as a result of his handling of the fallout from the Jimmy Savile crisis, and was paid the money - twice the amount to which he was entitled - in order to speed up his departure.

But the report by MPs was scathing, saying the pay-out was "out of line both with public expectations and what is considered acceptable elsewhere in the public sector". It said further benefits paid to him were "an unacceptable use of public money".

MPs also criticised "excessive" severance payments to ten other senior managers, including former chief operating officer Caroline Thomson who received £670,000 when she left this year. During the committee's hearing last month, MPs accused the BBC of offering her a large redundancy sum as "compensation" when she failed in her bid to become director general.

The report follows a review by former Sky News executive Nick Pollard - published on Wednesday - which painted a picture of a top-down organisation beset with rivalries and faction fighting.

Mr Entwistle would normally have been entitled to £225,000 - half his salary - if he had voluntarily resigned. And Mr Entwistle's other benefits under the deal drew further criticism: on top of his salary pay-off, he was given a year's private medical cover and contributions to his legal costs.

The BBC Trust agreed to the larger amount to allow a speedy clean break allowing them to draw a line under the episode and seek a new director general without lengthy legal negotiations.

Read more: Newsnight film 'should have never gone out', says BBC DG

'Reward for failure'

In its report, MPs said they are "extremely concerned" that the BBC Trust - which agreed the payoff to Mr Entwistle - had rejected an offer for the National Audit Office to examine the package for the former director general, who stepped down on 10 November.

"This inhibited parliament's ability to hold the Trust to account for its use of public money," the report said.

The committee concluded: "By agreeing to this (£450,000) payment, the BBC Trust may have secured the director general's quick departure but it did not act in the wider public interest. Public servants should not be rewarded for failure."

The committee said it considered the additional benefits to be "an unacceptable use of licence fee payers' money".

Pollard Review

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The Pollard Review found on Wednesday that the decision to drop a Newsnight report into Jimmy Savile's decades-long campaign of sexual abuse plunged the BBC into "chaos and confusion", revealing a corporation where "leadership and organisation seemed to be in short supply" - but it cleared top managers of a conspiracy to cover up. One senior executive has resigned in the wake of the report, with several others shunted aside into new roles.

Among the evidence in the report is an email sent to Mr Entwistle, two years before he took the top job, telling him an obituary for Savile was not done because of "the darker side" to his life.

Mr Entwistle told the inquiry he had not read the email, which Mr Pollard said indicates "there was knowledge, not just rumour...about the unsavoury side of Savile's character" in BBC television shortly after his death.

Stephen Mitchell, who has now resigned as deputy director of news, was criticised for removing the Savile investigation from a list of the BBC's potentially difficult programmes, known as the "managed risk programmes list".

BBC: 'no choice'

A BBC Trust spokeswoman acknowledge that £450,000 was a "substantial" sum, but that they were the best available under the circumstances.

"As already explained to the PAC and the Culture, Media and Sport Select Committee it is simply wrong to suggest the BBC Trust had a choice between a severance payment of £450,000 or half that level," she said.

"Indeed, if we had faced a constructive dismissal situation it would have cost us more and could have been a messy and long drawn out process.

"It is also not the case that the Trust refused to take up the offer to review the package - on the contrary, we suggested a wider study of severance payments at the BBC, which the NAO will now undertake."

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