The future of the news organisation in the Newsnight fiasco is in doubt after it emerged that its finances were in a poor state even before it became the potential subject of a major libel action.
The Bureau of Investigative Journalism helped with a report that resulted in Lord McAlpine, the former Conservative party treasurer, being wrongly identified as a paedophile. Who had responsibility for the report is the subject of claim and counter-claim that could have implications for the size of any libel payout. The bureau insists it had no editorial input into the report that went out on Newsnight and that its production was “100% the BBC”.
The bureau’s managing editor, Iain Overton, resigned last week after admitting that he should not have sent a text message trailing the programme and which, ultimately, led to McAlpine being identified on Twitter. The BBC has paid McAlpine £185,000 in damages and agreed to pay his legal costs. McAlpine’s lawyers have signalled they are preparing to sue the bureau and possibly those who tweeted about him.
The bureau’s latest set of accounts – for the year to 31 December 2011 – note that the organisation has estimated losses of £1,406,827. The accounts show that last year the organisation received no money from a sister organisation, the Trust for the Bureau of Investigative Journalism, which in 2010 provided it with a grant of almost £1m. The grant was made available as a result of a donation from the computer entrepreneur, David Potter.
However, as the grants from the trust reduced over the last couple of years, the bureau’s income has also fallen. Accounts reveal its turnover dropped from almost £450,000 in 2010 to almost £170,000 last year. Nyman Libson Paul, the bureau’s accountants, note that, as of the end of last year, the company had net liabilities of £49,597. The accountancy firm observes: “These circumstances … indicate the existence of a material uncertainty in connection with the company’s ability to continue as a going concern.”
So, produce something that no one wants and you go bust. Which is good of course: if you’re losing money that shows that you are consuming more resources than the value of what you produce is. That is, you’re making the world poorer. So you should stop of course.