In the years 2015 to 2020, the Bavarian Broadcasting Corporation violated its own procurement regulations in some cases for consulting contracts. This emerges from a special report published on Friday by the Bavarian Supreme Court of Auditors (ORH). The ORH examined 74 consultations for the production and technology directorate, the information program directorate and the culture program directorate. The BR awarded 42 of the orders “in over half without obtaining comparable offers,” says the report. “This was not in line with the principle of competition.” The BR not only disregarded its procurement regulations, but “acted contrary to the recommendation of its internal audit”.
Of the 74 cases examined with a total value of 3.4 million euros, only one was above the 2020 limit of 214,000 euros, above which an order must be put out to tender throughout Europe, it is said. The criteria for the assignment were, for example, “the consultant’s lack of alternatives” or “recommendations from the management”. In five cases, the BR was unable to provide any documentation of award procedures.
The annual salary of ex-director Ulrich Wilhelm rose to 403,473 euros
The ORH also found deficiencies in the success control of the consultants. Apparently, three consultations before the award even raised internal questions, but without consequences. In one case, the broadcaster’s internal audit department suggested ensuring and documenting the cost-effectiveness of the award. According to the ORH, the BR announced “that the profitability results from the low level of the daily rate (600 euros)”. The broadcaster did not have any further documentation.
In its statement on the test report, the BR agrees with the ORH’s criticism and announces that it will revise its test and control procedures. Reasons for the award decision and success control would be better documented in the future, recommendations of the internal audit, as well as legal and BR-internal regulations “must be complied with”.
Upon request, the BR does not comment on the individual consultancy contracts. In general, however, according to a spokesman, “consultancy contracts are only concluded when additional external expertise is required, for example in the construction sector, for more comprehensive project planning or larger IT projects.”
The ORH also documents the basic annual remuneration of the management from 2016 to 2020. The salary of the director Ulrich Wilhelm, who worked from 2011 to 2021, rose by ten percent to 403,473 euros during this time. Reason are tariff increases and higher salaries at the beginning of his second term; In the meantime, the salaries fell in 2017 because of “temporary part-time work”, according to the ORH.
The ORH also criticizes the many repetitions in the television program
Wilhelm had waived remuneration for activities in supervisory bodies, while several BR directors had received “compensation for committee work at subsidiaries of the BR” as well as “representation and function allowances”. The jointly reported remuneration of the six BR directors increased from EUR 1.25 million in 2016 to EUR 1.39 million in 2019; In mid-2020, a director was left without replacement – at that time radio boss Martin Wagner left and BR changed its structures – which reduced the post to 1.33 million.
In general, the ORH criticized the way in which BR reported its costs – the broadcaster works with “partial cost accounting” and justifies this with a reform of workflows and software in all ARD stations, which should be completed in early 2024. Online costs, for example, are not listed separately by the broadcaster. According to the ORH, 56.2 percent of the expenses are not specifically assigned to a product, but booked under “overhead costs”. The Court of Auditors criticizes that this means that the station’s cost accounting is not very meaningful and makes controlling in the station more difficult.
The ORH also criticizes the educational program ARD alpha. It was not possible to increase the range of the station and reduce the financial burden. The BR should get ARD stations to finance it and check whether the linear distribution of the station is really necessary. In addition, it should be checked whether the first programs from ARD alpha are not shown on BR television, which could lead to fewer repetitions in the program. Because, according to the dry diagnosis of the Court of Auditors: “BR Fernsehen and ARD-alpha deny their linear program mainly with repetitions.”
The ORH urgently calls for further staff reductions. He also sees a major financial problem in the broadcaster’s pension obligations: “The continuing increase in pension costs is restricting his ability to act.” This is also reflected in the items for personnel expenses: They rose to 35.5 percent of the budget in 2020. However, if you adjust for pensions, personnel expenses have fallen slightly to 25 percent. According to the ORH, the BR saved program costs mainly on radio, on ARD alpha and in the morning program.