BBC to spend a third of £600m savings on gold-plated pensions

Rob White

Mon, 23 February 2026 at 5:15 pm GMT+9 3 min read

The BBC has suffered from a steady decline in licence fee payers - Mike Kemp/In Pictures via Getty Images

The BBC is facing a £175m gold-plated pensions bill next year despite a pledge to save £600m, analysis shows.

The broadcaster has already set a target of saving £150m by 2028, but Tim Davie, the director general, announced plans last week to reduce the corporation’s £6bn annual budget by a further 10pc over the next three years.

However, staff in its generous defined benefit (DB) scheme will receive up to £50m in contributions during 2026-2027. It could also be forced to pay an additional £125m to complete a £1.14bn bailout for the scheme.

Maxwell Marlow, of the think tank the Adam Smith Institute, said the BBC continued to “play fast and loose” with licence fee payers’ money.

It comes as the annual fee has increased by another £5.50 to £180 a year as the corporation battles falling revenue and a lawsuit brought by Donald Trump, the US president. Last year alone, 300,000 more households cancelled their licences.

Mr Marlow said: “The BBC is still playing fast and loose with licence fee payer money.

“Instead of funding high quality media output, which is currently lacking across the corporation, they are diverting huge funds into unrealistic, unsustainable and unmatched defined benefit pension schemes.”

He added: “The private sector phased out these schemes a long time ago, and licence fee payers can’t even imagine what they look like, so why are they so prevalent at the BBC?

“The BBC should immediately withdraw current DB schemes and transition them into more sensible and fair defined contribution schemes.”

The BBC pension scheme, one of Britain’s largest, is made up of four different defined benefit plans, all of which were closed to new staff over a decade ago.

Some members can retire at 60 with uncapped final-salary pensions, while others receive an average earnings-based payment from age 65. Pensions will rise by up to 4.2pc this year.

Employer contributions for the scheme have previously hit 42pc as it battled soaring costs, but will be 15.9pc from April 2026. They remain more than five times the legal minimum of 3pc that most private-sector employees receive.

The BBC tried to reform the scheme in 2010, but had to offer concessions after staff went on strike. It also lost a High Court case to make pensions less generous in 2022.

New staff are enrolled in a defined contribution scheme, receiving employer contributions of up to 10pc. The broadcaster and its workers contribute a combined £110m a year.

The £125m forms part of the scheme’s deficit recovery plan, which has already cost £1.14bn since it was judged to be unable to afford its generous pension promises in 2010.

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The BBC is the subject of a lawsuit, brought by Mr Trump, about a Panorama documentary that edited a speech he gave to supporters before they stormed the US Capitol building.

A BBC spokesman said: “The defined benefit scheme closed to new joiners in 2010, so the number of active members continues to fall each year. At the same time, the funding position has continued to strengthen.

“At the BBC, we remain committed to offering a pension arrangement that is financially sustainable, fairer and more consistent for all our employees.”

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