NAO critical of BBC’s 45% Eastenders overspend

The BBC has failed to deliver value for money in its programme to build a new set for the TV soap EastEnders, according to a report by the National Audit Office (NAO) which said the broadcaster underestimated aspects of complexity, cost and risks of its approach, resulting in a 45% budget overspend

The E20 programme, to replace and enlarge the external EastEnders set and improve various infrastructure at BBC Elstree Centre, is now forecast to cost £27m more, and take an additional two and a half years to complete, compared to its plans in October 2015.

Originally, the BBC expected E20 to cost £59.7m and to be completed by August 2018. Due partly to forecast cost increases, the BBC substantially revised its plans in 2015, moving its target completion date to October 2020.

The NAO report says that while the case for E20, and the rationale for the current approach, is clear the BBC has failed to ensure it will deliver value for money. As a result of more realistic plans, the BBC now forecasts E20 will cost £86.7m and will be completed in May 2023 - 31 months later than envisaged in its 2015 plans.

The NAO considers that some of the reasons for the delays and cost increases could have been addressed earlier by the BBC. Early planning processes resulted in the BBC underestimating aspects of complexity, cost and risks of its approach. There was also insufficient construction project management expertise to identify critical design issues.

In addition, the BBC has faced issues such as higher than expected inflation in the construction sector, as well as asbestos and obstructions in the ground which to some extent were unforeseen by the programme team, partly due to poor site records. Inflation has had a greater impact than it would have done had the programme completed without any delays.

Amyas Morse, NAO head, said: ‘The BBC will not be able to deliver value for money on E20 in the way that it originally envisaged. It is surprising that some of the reasons for this were built in from the beginning.

‘Despite recent project management improvements, E20 is late and over budget against its 2015 plans. We believe that the planned benefits are still broadly achievable, but given the high-risk nature of E20 it will need close scrutiny until it is finished.’

A BBC spokesperson said: ‘The set of EastEnders was built in 1984 and only intended for use for two years. Over thirty years later, the show remains one of the BBC's flagship programmes and yet is filming from a set that is no longer fit for purpose. The new set will be suitable for HD filming for the first time and extend Walford to better reflect modern East End London.

‘It is a large, complex project which has already delivered many other vital improvements at BBC Elstree Centre but like any building work of this scale there have been challenges on the way, including construction market issues beyond our control and from working on a brownfield site. As the NAO recognises, the BBC already made improvements and are keeping the project under close scrutiny.’

Report by Pat Sweet

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