BBC ‘sold Television Centre to group that was clearly a tax avoidance scheme’

Margaret Hodge, chair of parliament’s public spending watchdog, criticises corporation for sale to consortium whose structure was designed to avoid tax

The BBC has been criticised by the chair of the parliamentary public spending watchdog for the “shocking” sale of Television Centre in west London to a consortium that she claimed was “clearly a tax avoidance scheme”.

Margaret Hodge, the Labour MP and chair of the Commons public accounts committee (PAC), criticised the BBC for “selling knowingly to a consortium that deliberately sets up a very, very complex structure … the purpose of which is to avoid tax”.

In a PAC hearing on Wednesday about the BBC’s property estate and the issues raised in the recent National Audit Office report into how the corporation has managed it, Hodge asked director general, Tony Hall, trustee Nicholas Prettejohn and managing director of finance and operations, Anne Bulford, “what on earth” the BBC had done signing up to a property deal with something that she claimed was “clearly a tax avoidance scheme”.

Running costs of BBC’s London headquarters are triple UK average
Read more
Television Centre was sold to a consortium of developers and investors called Whitewood, including Stanhope, Mitsui Fudosan UK and Alberta Investment Management Corporation, for about £200m in 2012.

Hodge said about 10 companies were involved and she was shocked that a public service institution such as the BBC had gone about the disposal of a publicly funded asset in such a way.

None of the three BBC representatives before Hodge’s committee were at the corporation at the time of the sale but Bulford said it had taken legal advice and informed the BBC Trust it was commercially appropriate.

Prettejohn said he had looked at the legal documents from the time and the “structure was legal and commercially appropriate” and not contentious.

Some of Hodge’s fellow committee members disagreed with her, saying it was not fair to put a greater burden on the BBC, which was trying to maximise returns for licence fee payers.

Hodge also said the fact that the BBC chair, Rona Fairhead, an HSBC non-executive director, was chair of the bank’s audit and risk committee during the time the bank’s Swiss banking arm helped wealthy customers dodge taxes and conceal millions of dollars of assets, “does raise issues” for the corporation.

When asked if the BBC Trust was doing any due diligence into Fairhead, Prettejohn said it was “not doing anything specifically ourselves” and he did not think it would be appropriate for him to comment on HSBC.

He said, however, that he expected there would be “a number of inquiries” into HSBC and the trust would take note of them. He also pointed out that Fairhead was not appointed by the BBC Trust – she was hired by the government – and confirmed she remained a non-executive director of HSBC.

Hall said the relationship so far with Fairhead had been “businesslike and strong”.