Parliamentary Committees and Public Enquiries
Over-budget EastEnders project was flawed from the start
BBC underestimated scale and complexity of E20, which will be completed nearly five years late.
- Read the report summary
- Read the report conclusions and recommendations
- Read the full report: Renewing the EastEnders set
EastEnders is one of the BBC's flagship TV programmes. Its external set was built 35 years ago and is no longer fit for purpose.
The completion of E20 will be critical if EastEnders is to compete successfully against rival shows and retain audiences in a context where fewer people are watching traditional linear TV.
However, E20 is late and over budget due to the BBC’s fundamental project management failures.
We are concerned that E20 has gone off-track yet again after the 26-month delay that we heard about in 2016, and disappointed by the BBC’s complacency in managing this project, particularly in its early stages.
The project is now set to cost licence fee payers £87 million – £27 million more than budgeted. It is not set to be complete until May 2023, nearly five years later than originally planned.
“The BBC made fundamental mistakes in planning and delivering E20, at significant extra cost to licence fee payers.
“The apparent complacency with which the BBC approached the project is entirely at odds with EastEnders’ strategic importance to the Corporation.
“It was a serious error at the outset not to consider exactly what skills would be needed to see E20 through. The resulting shortfall in key expertise set the tone for much of what followed.
“The revised completion date for E20 is still more than four years away and, as work continues, the BBC must demonstrate it now has a firm grip on the project’s costs and progress.”
Conclusions and recommendations
Despite considering it crucial to the future success of EastEnders, the BBC has managed its E20 project badly.EastEnders is a flagship programme for the BBC but is being outperformed by its soap rivals, such as Coronation Street, and its overall audience has reduced as fewer people watch traditional linear TV. Therefore, it is important for EastEnders that the BBC completes E20 so that the programme is best placed to not only succeed but to also secure its long-term future. However, since we last heard about a 26-month delay to the project in 2016, it has gone off-track again. The project is now set to cost £87 million - £27 million more than initially budgeted - and complete in May 2023, nearly five years later than originally planned in 2013. The costs have increased partly because of inflation in the construction industry, the effect of which has been exacerbated by delays - with the construction of the Front Lot only starting in October 2018 rather than August 2017 as planned in 2015. The BBC has also underestimated the scale and complexity of the project, including how it would age the new sets so that they either exactly replicate what viewers are used to, or look realistic where there are new locations. In addition, the BBC initially failed to allocate enough money to manage risks and contingencies. It has encountered problems including asbestos and obstructions in the ground, which have, to date, cost the BBC around £1.8 million and delayed works by around four months. Under its latest plans, the BBC has substantially increased its risk and contingency budget.
Recommendation: Commencing in October 2019 – one year into the construction of the Front Lot - the BBC should annually update the Committee on the progress, expected costs and completion date of E20. These updates should demonstrate how the BBC has learned lessons from previous project failings, and whether its revised risk and contingency budget has been adequate.
The BBC failed to get the right construction project management skills in place from the outset of the project. It is disappointing that the BBC failed to consider what skills it needed in critical roles in the E20 project team. The BBC accepts that as a result, it did not have enough construction project management expertise to plan and deliver E20 effectively. One of the impacts of this was that the project team did not introduce design development and change processes early enough. After the 2015 project business case had been approved, it took over a year for a design change process to be agreed between the E20 programme and EastEnders production teams. This led to a build-up of change requests after the design was supposed to be stable. This issue was exacerbated by the project and production teams failing to work together effectively in the early stages of E20.
Recommendation: By July 2019, the BBC should develop, and update us on, processes to make sure the right skills are in place from the outset for all of its critical projects.
The BBC’s procurement approach for the Front Lot contract was ineffective and increased the cost of the project by £2.3 million. In 2016, the BBC carried out a single-stage open procurement for the Front Lot but this was unsuccessful owing to limited market interest. This led the BBC to move to a two-stage procurement through its Building Contractor Service Framework, which cost it £2.3 million and delayed the project by six months. The second procurement, in which only two bidders met the BBC’s requirements, led to Wates being awarded the contract at a cost of £24.2 million, £9.5 million more than budgeted. The BBC’s cost consultants were unable to validate £3.1 million of the costs that were included in the final contract and concluded that limited market interest was likely to have inflated prices. In addition, the BBC's contract negotiations with Wates took six months longer than planned, partly because of discussions about what bricks to use for the set. The commercial problems the BBC has encountered on this project demonstrate its ineffective sourcing and negotiating approach, which may have implications for other contracts.
Recommendation: By October 2019, the BBC should provide us with evidence of how it ensures best practice in procurement and contract management across its diverse range of contracts – for E20 and other contracts.
Latest News from
Parliamentary Committees and Public Enquiries
Employment and COVID-19 inquiry launched by Lords Economic Affairs Committee03/08/2020 16:15:00
The Economic Affairs Committee launches its inquiry into employment and COVID-19 and invites written contributions to its investigation. The deadline for submissions is 10 September 2020.
Peers call for more transparency on trade deals03/08/2020 15:33:00
The International Agreements Sub-Committee has written to the Government outlining the concerns they’ve heard from stakeholders about some of the Government’s planned trade agreements and calls for “stronger powers for Parliament in scrutinising trade deals”.
Substantial reform of Universal Credit needed to protect the most vulnerable31/07/2020 11:25:00
The Economic Affairs Committee publishes its report 'Universal Credit isn't working: proposals for reform', which calls on the Government to make substantial changes to universal credit in order to protect the most vulnerable.
“Slow, inconsistent and negligent approach” to social care in pandemic30/07/2020 15:33:00
The Government’s “slow, inconsistent, and at times negligent approach” to social care in the Covid-19 pandemic has exposed the “tragic impact” of “years of inattention, funding cuts and delayed reforms”, leaving the sector as a “poor relation” that has suffered badly in the pandemic.
Non-tariff barriers require urgent consideration in the UK-EU negotiations30/07/2020 13:33:00
The EU Goods Sub-Committee, chaired by Baroness Verma, writes to Michael Gove about its inquiry on Beyond tariffs: facilitating future UK-EU trade in manufactured goods.
Conduct Committee publishes report on the Conduct of Lord Stone of Blackheath29/07/2020 15:33:00
The House of Lords Conduct Committee yesterday published a report by Lucy Scott-Moncrieff CBE, the independent House of Lords Commissioner for Standards, into the conduct of Lord Stone of Blackheath.
Chair calls on Government to learn lessons from gaps in worker and business support29/07/2020 12:43:00
Following a series of evidence hearings on the impact of coronavirus, with Ministers and representatives from businesses, trade unions, the self-employed, consumer and worker organisations, Darren Jones, Chair of the Business, Energy and Industrial Strategy (BEIS) Committee, has written to Secretary of State Alok Sharma outlining a number of key issues for the Government to address in its approach to support for business and workers as the country emerges from the Covid-19 lockdown.
Common Frameworks Scrutiny Committee recommended by Liaison Committee28/07/2020 15:33:00
The House of Lords Liaison Committee yesterday recommended to the House of Lords the creation of a Common Frameworks Scrutiny Committee.
Report on Universal Credit will publish this Friday28/07/2020 14:25:00
On Friday 31 July 2020, the Economic Affairs Committee will publish its report; Universal Credit isn't working: proposals for reform.