The BBC has announced that it will be axing 100 senior managers in an effort to cut the amount it spends by 25 per cent over the next three and a half years.

The BBC Trust has also endorsed a new pay strategy for senior managers joining the BBC and agreed to the proposal to freeze the pay of Executive Board directors for a further three years.

BBC Trust Chairman, Sir Michael Lyons, said; “The Trust challenged the BBC Executive to review senior pay at the BBC. Mark Thompson and his team have responded with a comprehensive set of proposals that strike the right balance between ensuring the BBC can attract the best people to do the job, while ensuring maximum value for the licence fee payer.

“Of course I realise this will have implications both for current and future BBC employees. However, it is right that as a major public service organisation, the BBC shows leadership on this issue during difficult economic times.”

Mark Thompson, Director-General of the BBC said; “The review published today demonstrates that the BBC is already achieving a significant discount against peer group organisations in its remuneration of senior managers. Nonetheless, I and every other senior manager need to recognise that we are in a different economic climate, that the media sector labour markets are depressed and that there are significant pressures on public finances.

“A few months ago we announced our determination to reduce the amount we pay top on-air talent. The recommendations we have announced today seek to achieve similar reductions within our senior management community. Senior managers will see their total remuneration fall over the period, with the biggest reductions felt by those in the most senior positions.”

The proposals will not lead to lower salaries for existing top executives because existing pay deals are legally binding, according to the BBC.