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AnnuAl report 2009–10

www.britishcouncil.org
2009–10 In brIef
If you would like a copy of this publication in large
print or another format, please email your request to
communications@britishcouncil.org

Our work directly engaged 18.4 million people –


an increase of 5.2 million on last year.
We reached 652 million people through the web,
radio and television – almost treble last year’s result.
However, in a world of six billion people this is just
a start.
Our turnover for the year was £705 million.
This was an increase of £60 million on 2008–09.
We are not complacent. This outcome is, in part,
a result of our relentless focus on efficiency and
long-term sustainability.
Our results show that we generated £2.50 for every
£1 of public money received. This represents good
value for money.
We implemented difficult cuts in the UK and 330
people accepted voluntary early retirement. We
have moved as much money as we can to our
Represents countries where frontline services and programmes, and away
the British Council has offices.
from back-office functions.
A full list of the countries where
the British Council is active can We are ahead of most public sector organisations
be found on the back cover in making cuts to invest in growth and develop
of this document. partnerships to meet the demand for what the UK
has to offer.
This is our annual report for 2009–10.

We were established in 1934 and incorporated n encourage cultural, scientific, technological


by royal Charter in 1940 to: and other educational co-operation between
the united Kingdom and other countries
n promote a wider knowledge of the
united Kingdom n otherwise promote the advancement of education.

n develop a wider knowledge of the our patron is HM Queen elizabeth II and


english language HrH the prince of Wales is our Vice-patron.

We are the united Kingdom’s international organisation


for cultural and educational relations.
www.britishcouncil.org
HoW to use tHIs report Contents

1 Introduction
this document is in four sections but tells The third section focuses on our performance
one story. in engaging with and reaching audiences overseas 2009–10 in brief 3
in our 11 regions. We provide background on How to use this report 4
It is of a year of success and growth in our work
how we measure our work, whether we have met Chair’s foreword 7
for the UK against a period of significant change.
our targets and what the results are telling us.
We faced, and continue to face, considerable Chief Executive’s introduction 8
This section also gives a country-by-country
economic pressure across the organisation, which Introduction to the British Council 10
breakdown of expenditure.
has resulted in a series of cuts to our UK workforce.
For the first time, we have provided information
The first section begins with a foreword by our new
on our impact in the UK.
Chair, Vernon Ellis, and an introduction from our 2 our work
Chief Executive, Martin Davidson. We then provide The fourth and final section includes the
On the ground where it matters 15
a short introduction to who we are and what we do, formal report on our financial performance –
where we work and who we work with. the annual accounts, which have been approved Investing in the UK’s most attractive assets 19
by the National Audit Office – and our governance Building UK cultural relations as a force 23
The second section is a collection of short case
arrangements. for global good
studies about our work from across the global
network and the UK. They focus on three themes: It describes how we are meeting our ongoing
efficiency savings targets from the last
n on the ground where it matters looks at the
work we are doing on behalf of the UK in difficult
Comprehensive Spending Review and 3 our performance
our contribution to the UK government’s
and demanding places. Measuring performance 27
Operational Efficiency Programme.
n Investing in the uK’s most attractive assets Global performance results 29
It includes information on our equal opportunity
looks at our work in the major emerging United Kingdom 30
and diversity policies and practice and our
economies and with established partners Central and South Asia 31
environmental policy.
to provide access to English, education,
culture and sport.
China 32
East Asia 33
n building uK cultural relations as a force for
global good looks at how cultural relations India and Sri Lanka 34
is meeting global challenges across the world Latin America and the Caribbean 35
and its role in building people-to-people links Middle East 36
for a lifetime.
Near East and North Africa 37
Russia and North Europe 38
South-East Europe 39
Sub-Saharan Africa 40
West Europe and North America 41

4 our report
Governance 43
Equal opportunity and diversity 54
Our people 55
Environmental policy 57
Financial review 58
Accounts 64
© James Brittain
© Frank Noon

CHAIr’s foreWorD
It is a great privilege to be the Chair of the British Council.
I have been in this role for only a matter of weeks, We also have to look forwards in ensuring that we
but the more I learn and the more I see of this great operate as efficiently and effectively as possible.
British institution, the more exciting and relevant it The Executive Board has already made some bold
seems. The British Council has worked on behalf of the and successful moves by restructuring to realise
UK throughout the world for over 75 years. Nonetheless, cost savings. But they are also now looking at how
I am amazed at its vast scope and impact. we can deliver our work even more effectively.

Of course, like many people, I knew something about Over the last few years big strides have been made in
the work of the British Council. But, perhaps typically, aligning our global operations and in developing some
my knowledge was very narrow. common programmes and approaches across our
network so as to maximise our impact. But now this
I was attracted to working with the British Council for
global approach is successfully working, we can see ways
a number of reasons. I have a strong personal interest
in which we can simplify our organisation and processes.
in the arts and I felt that my experience as Chair of the
I see many parallels here with the journeys undertaken
English National Opera would be highly relevant. Equally,
by many international organisations as they become
I hoped my international experience with Accenture
more globally connected.
would be useful and relevant. This has proved so.
Meanwhile, I recognise that in recent years we have
But I was also attracted to the idea of supporting
come a long, long way. Much of the modernising that
an organisation that promotes and delivers
has taken place over these last years has been achieved
cultural relations.
under the leadership and guidance of Lord Kinnock,
As Martin Davidson notes in his introduction to this who left the British Council last July. I would like to
annual report, the investment in the British Council record my thanks and that of the whole organisation
and its cultural relations work is an investment in the to Neil – the success you find in this annual report
UK’s global reputation. stands as fitting tribute to his time as Chair. In addition,
the organisation owes a great deal of gratitude to Gerard
We bring people together. We share knowledge
Lemos for the ten years of service to the organisation
and ideas. We generate opportunities to learn. Cultural
as a Trustee, then Deputy Chair and – prior to my arrival
relations may not have the same immediate impact of
in late March – Acting Chair.
traditional government-to-government diplomacy, but
its effects are often deeper, richer and longer lasting. They, like me, believe that the British Council is winning
influence for UK’s interests with the very best of the
We provide access and opportunity. In some parts of the
UK’s assets. The Board of Trustees and I will support
world we build capacity through our work in education,
the Executive Board in making our case for the future.
English, vocational skills and access to higher education.
We are fortunate to have the advantage of a great
We can help build a better civil society and tackle
cause being central to what we do.
the fundamental governance barriers. In developed
economies we provide access to UK assets and build Like all great causes, finding the single, clear message
multilateral, multilevel partnerships to tackle big issues. to convey to our customers, partners and stakeholders
is of paramount importance to me. As the world
In my short time in my role I have been impressed
changes, we must adapt and change too. However,
not only by the relevance of our work but also by
we must retain our focus at all times on our core
the scale of our reach in terms of sheer numbers
purpose. This document seeks to tell a clear, simple
of people involved.
story about our achievements in 2009–10.
The rewards of over 75 years of the British Council’s
You will find a great deal to be impressed by in this
work are still benefiting the UK. I saw this for myself
annual report, much to inspire and stories that no other
in Poland where our proven commitment has allowed
organisation I know of could tell. Indeed it is something
us to build up trust for the UK. As a result, we are
to be proud of.
known as a source of excellence in English language
teaching and viewed as a trusted partner on wider The British Council – something to be proud of.
educational and cultural issues.

I have been impressed by the passion, dedication and


professionalism of the British Council’s talented staff
wherever and whenever I have met them. But we
the rewards of over 75 have to look to the future too. I am keenly interested
Vernon ellis
in working with the Executive to ensure that in future
years of the british Council we continue to attract the best talent and to develop
Chair

are still benefiting the uK the talent already with us.


6 7

n
people want to connect with
CHIef exeCutIVe’s IntroDuCtIon the uK’s world-class higher
education institutions
The British Council is working for the UK around the world. We are building trust
and engagement between the people of the UK and other countries.

This has been another year of significant growth. Despite 2009–10 being a year of great change and
More people have been involved than ever before challenge for the British Council we were able to engage
with our work and we have increased the financial with over 18 million people around the world, many
turnover of our organisation. of whom look to the UK as a source of ideas, inspiration
and innovation. For the first time we also count the
The year 2009–10 was one of great change. It was
two million people in the UK who directly benefit from
to the great regret of us all that Neil Kinnock resigned
their involvement in international exchanges through
as Chair of the British Council last July. This followed
our work.
the appointment of Baroness Kinnock as Minister
of State in the Foreign and Commonwealth Office. This annual report draws on some inspiring examples
I am extremely grateful for the support and guidance of our work. Some are on a huge scale in emerging
given by Gerard Lemos as Acting Chair for much economies, like the success of the Turner exhibition
of the year. in China. Others are on a smaller scale but no less
important, in harsh environments like Afghanistan,
Our new Chair, Vernon Ellis, joined us on 24 March 2010.
where we are helping tens of thousands of people learn
Vernon brings exceptional experience of international
English. A few examples focus on very personal stories
business through a long and distinguished career
like Hassan and Ahmed’s tale of travelling from Baghdad
with Accenture, most recently as International Chairman,
to Belfast because they believe in being global citizens.
as well as unrivalled connections in the arts as Chair
of English National Opera. It is ever more important in this economic environment
that the UK has access to global markets, global ideas
Over the last year, we have, like many other public
and global opportunities.
organisations in this country, been challenged to
demonstrate value for money for our use of the The report looks in brief at how we are supporting
£200 million of public money we are entrusted with. the English language industry in the UK, which is worth
This report provides clear testimony to the benefit £3–4 billion a year, and the success of the world’s
of our work to the UK’s cultural, economic and number one exam in its field, IELTS. The UK’s higher
diplomatic relationships with other countries. education is an asset to be proud of. Along with
our leading institutions we believe that its future lies

© Fayyaz Ahmed
We have generated almost £500 million income from
in truly internationalising itself beyond the traditional
our commercial businesses. Tough economic conditions
recruitment-led approach of the past. You can find out
in many parts of the world have meant that we have
what our plans are to work with the sector to support
had to work harder than ever to achieve this result.
this multi-billion pound industry in this report.
We are able to generate £2.50 for every £1 of
government grant recieved. The next generation remains a focus for us in countries
across the world and also here in the UK.
This is good value for money. It represents a valuable
investment in this country’s global reputation Next Generation Pakistan reported how young people
and the long-term relationships that benefit the UK in that country want to be active citizens, helping
and the world. to shape their future and that of their nation to take The UK has rich cultural and educational resources with We want people of all ages and every background in the
advantage of all the opportunities of being part which to renew and develop the relationships we need UK and throughout the world to get involved in cultural
Our relentless focus on becoming more effective has
of a young growing country. We have been asked by to build a more prosperous, secure and better future. relations and the work of the British Council.
also meant becoming ever more efficient so that we
the Pakistani government to work with them as they
can meet the challenges of the world around us. People want to connect with the UK’s world-class higher Our plans for the future mean we want to do more,
look at the questions the report raises.
Securing our future has meant cutting some long- education institutions. We can ensure policy makers even at a time when we are thinking about having
At home, we brought the world into the classrooms have contact with those in the UK who can help to spend less.
standing and valued programmes as well as
of young people in more than 7,000 schools last year. in reforming classroom practice so children all over
implementing difficult changes across the organisation It means that we are winning influence for British
We think that young people in our country must the world have better prospects. People want to learn
– these as well as other savings are detailed throughout interests. It means that we are there working for
develop a better understanding of the world beyond English and governments understand that English
this report. This has included losing 500 posts in the the UK where it matters.
our borders if they are to be successful as adults can help them with economic progress. People want
UK in 2009–10 and 2010–11, with a very large number
in a global economy. to draw inspiration from the UK’s creativity and tens
of staff leaving after many years of service.
It is for this reason and many more that the British of millions of young people are improving their lives
I am enormously proud and grateful for all they have thanks to the UK’s most attractive of assets, sport.
Council puts the UK at the heart of everything we
achieved in their service with the British Council.
do because we know that cultural relations benefits
the people of this country. Martin Davidson CMG
Chief Executive

8 9
An IntroDuCtIon WHo We Are
to tHe brItIsH CounCIl We are the United Kingdom’s international organisation
for cultural and educational relations.
We are the UK’s second biggest charity.
We have offices in over 100 countries and territories
and are active in many more.
We call what we do cultural relations.
We build engagement and trust for the UK through
the exchange of knowledge and ideas between
people worldwide.
We create long-term relationships that provide cultural,
diplomatic and economic benefit for the UK.
We provide access to the UK’s assets in big, emerging
markets, by providing opportunities for millions of people
to engage in global dialogue.
We are operationally independent from the UK government,
which enables us to build trust on the ground in places and
with people where relationships with our country, society
and values are strained.
We are living within our means and we have ambitious
plans to grow.
We place the UK at the heart of everything that we do.
We are working for the UK where it matters.

11

A graffiti artist’s work outside our office in Tanzania © Chuck Koor Hargrove
WHere We WorK AnD WHo We WorK WItH
WHAt We Do Our work targets three main groups overseas and in the UK, and we work
with a range of partners:
The following summary describes the cultural relations activities we believe are
effective in the six broad geopolitical types of country: Aspirants partnership
Aspirants are generally younger people who are Partnership is at the heart of our work and central to
in education, or starting out in their careers. Counted our plans for growth.
lifeline countries n We are one of the very few points of international contact. in the millions, they may be opinion formers within
Cultural relations matters. We want to increase the
their own networks and may become influencers.
e.g. Burma, Zimbabwe n We provide a lifeline to the outside world through educational, impact of our work by working with and through others.
cultural and social programmes. We want to build the cultural relations capacity of others.
Read about how we are supporting development in Burma, Influencers From small community organisations to important
on page 16. Influencers are mid or mature career professionals, UK-based institutions, global multilaterals and host
educators, artists, scientists, community or business governments, we work with more than 300 partners
building trust countries n We work on dialogue, access to English language, education leaders, and policy makers. This is a critical group for every year.
and skills, as well as sharing culture to tackle misconceptions us, particularly as, through them, we can reach many
e.g. Pakistan, Middle East The stories speak for themselves.
on both sides and build employability, prosperity and trust. more people and maximise the impact we make.
This year our partnership with the Open University
Read about how we are giving the next generation in Pakistan
and the Foreign and Commonwealth Office helped
a voice, on page 15. leaders
us to deliver courses to people in Burma. We are
Though a very small proportion of our target audience, working with the government of Rwanda to support
new and emerging economies n We work with a wide range of UK partners – educational, this group is essential to give access to wider groups their move to English as the language of choice.
cultural and business – to increase access to UK education and to enable us to operate effectively.
e.g. India, China
and culture and build prosperity and sustainability. New partnerships with Microsoft and Tata Sky are
bringing English to the otherwise excluded in India
Read about how English is changing lives in India, on page 21. our work in the uK and the International Inspiration team will deliver
n We work with young people in the UK – helping them a lasting legacy for London 2012.
Developing countries n We provide access to social and educational development,
to widen their horizons and develop international links,
deliver development contracts and enable cultural exchange We are proud to work with the BBC World Service
e.g. Nigeria to gain access to opportunities for self-development
that builds capacity, understanding and prosperity. again to bring issues that matter to millions, whether
and to make a global contribution.
faith and climate change in Nigeria or the ideas
Read about how we are working with faith leaders that Darwin’s work continues to raise in the year
n We work with people in influential positions and roles
in Nigeria to improve understanding about the threat of his anniversary celebrations.
in the UK – improving access to the opportunities
of climate change, on page 23.
we provide for international engagement, or enabling
More people involved in more cultural relations will
them to experience this at first hand.
help make the world a better place.
open and developed countries n We work in partnership with education and cultural institutions,
business, the EU and international bodies. n We link with the UK’s leaders – involving them
with strong, pre-existing ties
in our programmes as participants, or working with
with the uK n We connect young people through school links, scholarships
them to show the power of international engagement.
e.g. France, USA and exchange programmes and build influential networks across
continents to share experiences, solve common problems
and maintain and strengthen international relationships.

Read about the UK–USA New Partnership Fund which will


re-invigorate collaboration in higher education, on page 20.

united Kingdom n We provide educational opportunities for young people,


internationally linking schools and educational institutions
throughout the UK.

n We work with the UK higher education sector to attract


international students to the UK and internationalise the sector.

n We support the best of the UK’s artistic, creative and scientific


content to reach overseas audiences, as well as linking UK
experts in education, arts, sports, science and governance
with experts all around the world.

Read what Professor Joseph Nye said about us, on page 30.

12 13
our WorK on tHe GrounD
WHere It MAtters
Our work in many countries focuses on building long-term, two-way relationships
and trust for the UK, creating opportunities for development and providing lifelines
to the outside world.
We are active in some of the world’s most difficult environments and important
places. We offer access to the UK’s education and culture, our knowledge
and ideas.
We think cultural relations can tackle misconceptions We are meeting the challenge of poor internet coverage
of the UK and we operate in the belief that it is in in remote regions with a combination of CD-ROM
our national interests to build trust with people in places materials and a national radio series, which teachers
where the UK can divide opinion. can access through battery and wind-up radios.

Our overseas network is a unique resource for the UK,


In Afghanistan, we helped more with offices in over 100 countries, and we are active

than 10,000 english teachers in 30 more. We have been in Iraq and Afghanistan since Giving voice to pakistan’s
2003 making a distinctive contribution to the economic next generation
develop their classroom skills and cultural development of both countries. Over the
We commissioned a ground-breaking study of the
last three years we have shifted resources to meet
attitudes and aspirations of young Pakistanis, which hit
geopolitical priorities. We want to bring the UK’s ideas
the headlines across the world and is helping to reshape
and creativity into contact with more and more people
the debate on the future of young people in Pakistan.
so that our work can help create a more peaceful
and prosperous world. The Next Generation report highlighted the projections
for Pakistan’s population to grow by more than 85 million
As this annual report shows, our programmes can reach
in 20 years. Half the population is aged under 20 and the
the lives of millions and make a difference to smaller
report set out how young people wanted to help shape
numbers of people where access to the outside world
policies affecting their futures.
is restricted. Our English language teaching work in North
Korea is on a small scale and we constantly have to find The report explored the identity dilemmas of young
new ways to bring our work to audiences in the West people and their lack of confidence in the institutions
Bank and Gaza. For us, not being in these places is not of Pakistan and it captured their eagerness to contribute
an option. Provided we can ensure the safety of our staff, as good, active citizens.
we will always be where the demand is for our work.
We were invited by the National Planning Commission
We provide real opportunities for young people from to convene an inter-ministerial team to review youth
every socio-economic background to improve their lives policies and stimulate ways of involving youth more
by accessing the UK’s skills, knowledge and experience. closely in development issues, education priorities and
We know that economic opportunity leads to better building economic stability for this country that is hugely
security and we want to help people contribute to their important to the UK.
own country’s future and create stronger relationships
The Chair of the Youth Parliament of Pakistan, Abrar
with the UK. Playing a part in the development
ul-Haq, a member of the Next Generation task force,
of countries throughout the world is important
called Next Generation a landmark: ‘The report shows
to us because it is important to the UK.
© Tony Jones how eager and willing are young people – whether
These short stories illustrate a sample of the work from the teeming cities or rural outskirts – to take
© Fayyaz Ahmed we are doing across the world in different geographies on the responsibility of deciding their own future.’
and on very different scales.
Pakistan’s media described the report as a ‘wake-up call’
to the authorities.

This work forms part of our Active Citizens programme,


building english capacity which is assisting more than 17,400 young volunteers
in Afghanistan across Pakistan, Bangladesh and Nepal to develop
In Afghanistan, we helped more than 10,000 English their leadership skills and contribute to sustainable
teachers develop their classroom skills. We want development.
to reach 33,000 teachers, to build their confidence.
This will provide them with up-to-date teaching
resources from the UK.

15

© Geoff Crawford
lifelines for a lifetime in Zimbabwe of developing a high-quality education system that Working behind the scenes to bring Organisers also obtained the all-important blessing and
will give Iraq what it needs for the future. the royal ballet to Cuba goodwill of Alicia Alonso, who created the Ballet Nacional
In Zimbabwe, we are one of the very few points
de Cuba. In one performance, Cuban dancers joined
of contact to the outside world. We are providing This followed the launch of a 16-month, $2 million, The Royal Ballet’s visit to Cuba last year was called
dancers from the Royal Ballet on stage, in a tribute
an educational and cultural ‘lifeline’ to the UK. UNICEF-funded project to improve education for more ‘transcendental’ and ‘the most important cultural event
to her. Amid the roar of the headlines – ‘Delirio cubano
Here are a few examples of what we did this year. than 150,000 Iraqi schoolchildren by transforming in Cuba for 30 years’ (since the visit of the Bolshoi).
con el Royal (Cuba is in delirium for the Royal Ballet)’,
approaches to teaching, learning and school leadership
Demand for our work is higher than ever. Our libraries Throughout our history we have played the role ‘Royal Ballet seducción cubana (seduces cuba)’ –
in the country.
in Harare and Bulawayo are open for business and of broker and facilitator. Sometimes this means working were the quiet and special words spoken when Alicia
76,000 people visited last year. We are meeting behind the scenes to make things happen. This is what met Dame Monica Mason, director of the Royal Ballet,
the needs of young professionals of all backgrounds we did in Cuba. ‘Please come again.’
in Zimbabwe, who are facing an acute shortage english for rwanda’s development The Royal Ballet arrived in Cuba at the end of their This people-to-people partnership provided Cuba
of books and study materials.
We are working with the government of Rwanda and the summer tour to Washington and Grenada. This followed with a stunning display of quality, diversity and positive
Zimbabwe’s universities are desperate for high-quality UK’s Department for International Development to bring a year of close co-operation with local producers, the perceptions of contemporary Britain.
links with the UK and we are helping them. Our English into the classroom as the country continues Ministry of Culture and the British Embassy. Since we
Development Partnerships in Higher Education (DelPHE) on its remarkable road to recovery. opened our office in 1998 our team has developed
scheme, which is funded by the UK’s Department strong networks among cultural and educational
We answered a call from President Kagame in 2008 Getting qualified in sudan
for International Development, has brokered six contacts. Our role was to ensure that we helped
to help his country make the change from French
partnerships already and more are coming. the right people from the UK talk to the right people In Sudan, we are working in the north and south of the
to English as the language of instruction in schools.
in Cuba. We invested the time of our people, our country to give every university teacher of English a
Connecting Classrooms is one of the largest British This decision will support the country’s economic growth
knowledge and experience to make this happen. professional teaching qualification from the UK by 2012.
Council school links programmes in Africa. We have and provide opportunities for thousands of young
linked more than 70 schools, covering all the provinces Rwandans to participate in their country’s development. Around 15,000 Cubans saw the Royal Ballet’s The Cambridge Teaching Knowledge Test course has
of Zimbabwe, to schools in both the UK and other African performances with Cuban dancer Carlos Acosta on provided teachers from Darfur to Khartoum with the first
The Ministry of Education has to date, with our support,
countries. Even during recent political tension between the stages of the Gran Teatro and Teatro Karl Marx step on the road to becoming better qualified and better
trained over 44,000 English teachers.
Zimbabwe and the UK, the Permanent Secretary in Havana. Giant screens on the steps of the Capitolio able to meet the demands of rebuilding their country.
of the Ministry of Education supported the programme, Sharon Haba, Permanent Secretary, Rwanda Ministry relayed the spectacle to 5,000 people and many more
describing the British teachers visiting the country of Education, said: ‘The Ministry of Education values enjoyed it thanks to the Cuban television broadcast.
as the ‘best ambassadors for Zimbabwe in Britain’. its partnership with the British Council and looks forward
to another year of collaboration on the Rwanda English
Zimbabwe left the Commonwealth in 2003, and since
Action Programme.’
then there has been little contact for ordinary
Zimbabweans. In 2009, to celebrate its 60th anniversary,
a ‘Commonwealth Conversation’ was held in many
member countries. The British Council organised the supporting development
Commonwealth Conversation in Harare, at the University in burma with british expertise
of Zimbabwe, so that for the first time since their country We are working with the Open University and the
left, several hundred young, intelligent Zimbabweans Foreign and Commonwealth Office to strengthen local
could talk openly about what the Commonwealth means
to them.
institutions, support positive social change and create our Active Citizens
networks of empowered non-state actors using British
We are getting things done in Zimbabwe. We are expertise in Burma. programme is assisting
providing a lifeline to the UK and to the wider world for Responding to demand in Burma for what the UK can more than 17,400 young
young Zimbabweans. We want them to last for a lifetime. offer, we have delivered Open University social studies
courses for Burmese civil society activists.
volunteers across pakistan,
One of the trainers said: ‘What do they have in common,
bangladesh and nepal
uK at the forefront of rebuilding these students? All have suffered, to some extent, from
education in Iraq economic hardships that make good-quality further
In January 2010 we signed a three-year, £3 million, study an impossible dream. All have been active
DFID-funded DelPHE contract to restore excellence in in their respective communities and all are singularly
Iraq’s universities by renewing links with UK universities. enthusiastic about what they can achieve if just given
the chance.’
YouGov polling showed that 45 per cent of respondents
believe that improving education in Iraq’s schools and We provide a safe space for civil society volunteer
universities is the best contribution the UK can make networks where hundreds of our library members
to helping Iraq become stable and prosperous. and students work on community environmental
projects, with, for example, HIV-positive street children,
That is what we are doing.
or as teacher trainers.
Using the UK’s world-class expertise in education
Our library and information centres in Rangoon
and our presence on the ground, these partnerships
and Mandalay are providing more than 220,000 visitors
emphasise the UK’s long-term commitment to Iraq.
a year with a window to the world and information
Major contracts signed during 2009–10 in Iraq are about the UK.
building trust for the UK by placing us at the forefront

© Mat Wright
16 17
InVestInG In tHe uK’s
Most AttrACtIVe Assets
The UK’s assets of English, education, sport and culture are attractive to leaders
and learners across the world.
We work to increase access for the millions of people who want to learn from,
share in and access what the UK has to offer.
In the big emerging economies, we are working with Denise Lewis, Olympic gold medallist and official
people of every age and background and with partners International Inspiration Ambassador, travelled to India
in the public and private sectors to support economic, last year to see our work first hand. She visited schools
social and cultural development. in Delhi where International Inspiration has helped to
develop high-quality and inclusive approaches to the
This work will help secure the UK’s long-term
teaching of PE. It has provided opportunities for children
relationships, as well as our partnership, with these
to engage in meaningful sport activity – often for the
countries and will contribute to the growth of our
first time.
own economy.
Denise said: ‘In my own life I have seen and experienced
Languages are the backbone of cultural relations.
the transformative power of the Olympic Games, but
A core part of our mission is to make a significant
here in India I have seen something truly special.
contribution to the global development of English and
Through International Inspiration, the Olympic and
the opportunities which it offers for people and nations.
Paralympic Games have made, and will continue to
Our vision is that each of the 11 million teachers
make, a real and lasting difference to the lives of millions
and every one of the two billion learners of English
of young people in India and across the world, no matter
in the world will have access to the skills, ideas and
what their ability, social status or gender.’
materials they need from the UK.
Such powerful engagement from high-profile sports
Our work in education helps young people in schools,
personalities helps to amplify our message. It means
professionals in higher education and policy makers
we can reach a much wider audience. It helps us to
in governments to improve their prospects. We bring
engage the media and the general public to show how
together specialist expertise and knowledge from
International Inspiration is delivering real impact for the UK.
the UK with policy makers and practitioners from other
countries. We help broker the exchange of excellence International Inspiration is the official international sport

© Rajiv Kumar/International Inspiration/India 2009


and facilitate development and growth in education, legacy programme of the London 2012 Olympic
both for the UK and other countries. and Paralympic Games. We have been working with
our partners at LOCOG, UNICEF, UK Sport and others
The UK’s cultural assets enjoy an excellent international
to maximise the impact of the International Inspiration
reputation. We are helping meet the demand for access
Ambassadors. David Beckham, Dame Tanni Grey-
by bringing new work from the UK to new audiences
Thompson, Sir Chris Hoy and Colin Jackson are also
all over the world. We are showcasing exciting modern
Ambassadors for the programme.
visual artists, performing artists and established works
from this country. For example, Connected showcased We know that sport changes lives. International
Denise lewis in a playing field new work from the UK during the Tokyo Performing Arts Inspiration will change the lives of 12 million children
in Vasant Vihar, new Delhi Market. We use culture to bring people together to build
bridges, build relationships and to celebrate excellence.
and young people in 20 countries, and role models like
Denise Lewis are helping to make this dream a reality.

Sport, like English, is a global language. It is one of


our country’s greatest assets. It transcends borders,
has a universal set of rules and is a simple, practical english for the uK,
way of bringing people together. The first story here english for the world
is an example of work with our partners in the build-up
We estimate that English language teaching is worth
to London 2012.
£3–4 billion a year to the UK’s economy. We are helping
the industry here in the UK. We provide accreditation
services to English language schools so that they can
shining a light for sport attract students from all over the world, using our global
Young people look to their favourite swimmer, footballer quality mark.
or athlete for inspiration or as a role model and we
© Sirichai Leangvisutsiri

We continue to recognise innovation and excellence


know that professional sportsmen and women can in English language teaching from the UK. The ELTons
be powerful advocates for our sport programmes. awards showcase and reward outstanding new language
© Mat Wright

learning products from the UK.


19
IELTS is the world’s leading English language test. The fund follows research that we commissioned,
We celebrated our 25-year partnership with Cambridge which argued that only renewed investment by the UK
ESOL and IDP Australia last year. It is still setting the in its bilateral relationship with the US will help us retain
standard for people all over the world and more than our leading position – worth $1 billion a year.
1.4 million people have taken IELTS this year alone.

Our LearnEnglish website attracts over one million


unique users per month. We launched our LearnEnglish rebuilding in russia
iPhone and Android applications this year. They are The opportunities in Russia are enormous. Over the
helping young learners and their parents, from a range last year our work has tried to meet the demand
of socio-economic backgrounds, to develop their skills for connections with the UK. Strong cultural relations
and support each other. between the UK and Russia help the wider bilateral
Over eight million users visited the English Online relationship and we are focusing on what we do well
website in China in 2009. They can practise English in the arts, education and English.
and pick up useful advice. In a joint promotion with Nokia For example, we are building a Russia-wide community
and the China Youth League users can play an English of English teachers by providing training for trainers
Online word game and receive virtual points to donate and videos of classes and classroom exercises.
books for schools in less developed regions of China.
We have been working closely with our partners at
Over the period of the promotion 300,000 users took the Moscow City government, Russian architects, city
part in the game. We are also launching new mobile planners, designers and community workers. Our Installation view of The Future
products for English learners, including a spell check
game, which was launched for Android system phones
Creative Cities programme is helping them to rethink
the use and redesign of unused public spaces in urban
Demands Your Participation:
in China.
Contemporary Art from the

© Emma Williams
environments. The new Strelka Institute of Architecture
was influenced by this work and we helped them
to find UK expert partners to develop short courses
British Council Collection
A new approach to and postgraduate programmes.
international education We teamed up with lookatme.ru, a leading Russian
Our Chief Executive, Martin Davidson, announced a £17 fashion and design web portal, to launch the
million investment for international collaboration and International Young Fashion Entrepreneur Award,
Mona Hatoum, Damien Hirst, Anish Kapoor and We have now worked with 2,348 master trainers
partnerships for UK universities at the largest higher which reached an audience of 500,000 people a month.
Steve McQueen. throughout India who themselves reached over 450,000
education conference of its kind in this country. As a result, we have built stronger ties with fashion
teachers who, in turn, taught 17 million learners.
and creative entrepreneurs in Russia, helping them to Looking ahead, we are reaching out to the next
We brought more than 1,200 people from over 70
make connections with British designers. This led to a generation of arts producers to position the UK as We have developed a partnership with Tata Sky
countries to London to participate in Going Global 4 to
high-profile British presence at Russian Fashion week. a leading partner for China’s ‘cultural renaissance’. to develop a conversational English language course
hear from policy makers and practitioners from all over
targeted at homemakers as part of their Active Channels
the world about the challenges faced by education in a We want more people-to-people links between the This approach has already led to major tours by many
offering. This has reached more than 120,000
global age. UK and Russia so that we build a future between our of the UK’s prominent dance companies, orchestras and
subscribers since January 2010.
countries which is founded on understanding and trust. contemporary theatre companies. We have brokered
We have pledged our support for a new approach
That is a prize worth pursuing. partnerships between Chinese institutions and their We have opened new teaching centres in our office in
to international education that will no longer be
UK counterparts, including the Royal Opera House, Chennai and in partner premises in Kolkata. Using local
characterised solely by a recruitment-led approach. We will:
the British Museum and National Museum Wales. teachers and these partner premises, we have been
n build capacity in the provision of strategic education able to set fees affordable to people with lower incomes.
supplying the demand for the By doing this we are attracting new learners who would
intelligence, to identify trends and opportunities
on a global basis
uK’s art in China not have otherwise been able to access our classes.
There is huge demand in China for access to
english changing lives in India
n develop a global programme of sustainable
the UK’s art and creative industries. In partnership and sri lanka In partnership with Microsoft India we have developed
partnerships, linking businesses, governments a Skills for Employability programme aimed at helping
with Tate Britain and the National Art Museum We commissioned David Graddol to look at how the
and higher education institutions to strengthen aspiring rural youth to gain a first step on the
of China we took an exhibition of Turner’s masterpieces English language can help sustain the growth of the
knowledge economies employment ladder. The online course follows the story
to Beijing last year. Over 200,000 people experienced world’s biggest democracy and one of the fastest
of Ishan, a young man who leaves his village to travel
n support new models of student mobility that start the exhibition first-hand. Beijing News described growing economies.
to Delhi in search of a job.
to rebalance inward and outbound student flows it as ‘an important exhibition introducing European
English Next India tells us that from education to the
art and culture to China’. We are working with the Sri Lankan government –
n convene global policy dialogues that build a deeper economy, from employability to social mobility, the
supported by USAID and UNICEF – to manage the
understanding of developments and insights It was a first for the UK and a first for China. prospects for India and its people will be greatly
Training for Language Teaching Communities (TELT)
in education and promote knowledge sharing. The exhibition stood as one of the longest-running enhanced by bringing English into every classroom,
project, which aims to build a more skilled and cohesive
shows of international art masterpieces ever held every office and every home. We are helping English
For example, the UK–US New Partnership Fund is teaching community in the conflict-affected north and
at the National Art Museum. In the build-up to this year’s to reach people regardless of income.
worth $500,000. By using money from the Prime east provinces of Sri Lanka. Our library in Colombo is the
Expo we took works by contemporary UK artists from
Minister’s Initiative (PMI2), we are helping to develop In India and Sri Lanka, we have continued to build largest in our global network, with 25,000 members.
our collection to Shanghai. The Future Demands Your
strategic links between the UK, USA and third countries ground-breaking partnerships with state governments,
Participation: Contemporary Art from the British Council
like China, Pakistan and India to support existing or state boards and corporate partners, using English
Collection featured 40 artists, including 12 Turner Prize
pilot partnerships. to transform people’s lives.
winners and 21 Turner Prize nominees. They included
20 21
buIlDInG uK CulturAl
relAtIons As A forCe
for GlobAl GooD
Cultural relations provides a genuine and highly effective alternative to other forms
of international relations.
We have over 75 years of experience in the field and we work with people
on issues that are important to the UK and important to them.
Tackling the big global issues of our time requires This led to the creation and signing of an Interfaith
a multilevel and multilateral approach. Much of our Declaration on Climate Change, which aims to set out
focus is on the 50 per cent of the world’s population a roadmap for adaptation and mitigation strategies on
who are under 25. We aim to give voice to the next this issue. The BBC World Service and the Islam Channel
generation: to those who are not always heard covered the event, bringing the total audience reached
and to whom we must listen. Cultural relations works through the event and subsequent talks by religious
for them because its starting point is open and honest leaders to over 100 million.
exchange. In a world where people are hungry for direct
Our faith and climate change work was inspired by
communication with their global peers, it works beyond
research we commissioned from the BBC World Service
government-to-government diplomacy towards a new
Trust in 2008 into public attitudes to climate change
people-to-people diplomacy.
in sub-Saharan Africa.
Cultural relations appeals to partners from across the
We know that climate issues are the responsibility
UK, the European Union and a range of international
of governments, but faith leaders have influence in ways
organisations. We form and forge partnerships to build
that political leaders do not.
networks that make a difference and help change minds,
lives and relationships between the people of the world Sheikh Kabara, leader of an Islamic sect in Nigeria
and the people of the UK. and West Africa with over 10 million members, recently
talked to a large congregation of 300,000 followers
Our work creates access and opportunity for people
about the need for environmental protection and action
to act on big global issues and make a positive change
on climate change.
in their communities. New global citizens care about
climate change and we are helping the Chinese
government develop resources for the new UK–China
National Teaching Training Centre for Climate Change. Global citizens: from baghdad to belfast
Young people want to know how to reach out to Hassan and Ahmed (pictured left) arrived in London as
the world around them and create better prospects the Iraqi winners of the ‘I’m a Global Citizen’ competition
for themselves. to meet 70 young people from across the Middle
Cultural relations is a means to discuss big and East and the UK.
We want to create better relationships sometimes difficult issues. We have taken debates about They talked about climate change, the effects of
between the people of the world and evolution and the impact of Charles Darwin’s work into globalisation and what it meant to be a global citizen.
the Muslim world. We have been working with faith
the people of the uK
© Mat Wright

We took them to St Patrick’s Academy in County Tyrone,


leaders in sub-Saharan Africa to improve understanding Northern Ireland, to spend time working on their
of the threat of climate change to their congregations. school partnership and building long-term friendships
Over the last year we have worked with people that will benefit both countries.
and partners on issues that matter across the world.
Here are some examples.
living Darwin’s legacy
The Darwin Now, Living Legacy Conference in
faith and climate change Alexandria, Egypt, marked the 150th anniversary of the
In February 2010, in Nigeria, we brought together publication of On the Origin of Species and 200 years
faith leaders from Christian and Muslim communities since Darwin’s birth.
from across sub-Saharan Africa to discuss the role Darwin Now is our international cultural relations
that religious leaders can play in raising awareness contribution to the celebration of these anniversaries
of climate change in their communities. and the impact of Darwin’s ideas of evolution
on contemporary biology, medicine and society.

23

© Hatheybowprofile LTD
We invited people of all ages and from every background Evidence of change is marked in Pakistan: almost
to ask the question: ‘What is the relevance of evolution all of the 130 schools involved have set up student
to me, my life and my society?’ councils, transforming student–teacher relations.

We highlighted the impact of Darwin’s work and A head teacher in the North-West Frontier Province
emphasised the UK’s contribution as a respected spoke of the culture of physical punishment, often
international partner in science, arts and the humanities. in front of other students, which prevailed before the
Our partners for the anniversary celebrations included Connecting Classrooms project: ‘Now this has stopped.
the BBC, the Open University and the Wellcome Trust. When there is a problem we try to talk to the students
and find out what the problem is. Our trainers gave us
In Latin America alone more than 1.6 million people
the idea of motivating students through respect and
engaged with Darwin Now and the exhibition toured
love. We learnt we can’t achieve this through fear.’
27 cities in seven countries across the continent.

Two of Darwin’s descendants participated in activities


in Argentina and Brazil. His great-great-grandson, Randal
Keynes, gave talks at the exhibition in parts of Brazil,
Winning the peace
including the Brazil Annual Science Festival in Manaus. We invited NATO to share a platform with us to engage
the Brussels international community about the role
cultural relations can play in conflict prevention
and resolution. The timing was significant as NATO
springboard to building understanding
and trust between the uK and the
is currently reassessing its doctrine for partnerships
with civilian organisations and rewriting its Strategic
We are helping women in egypt,
Middle east Concept for the first time in 11 years. Drawing on our Jordan, Morocco, syria, tunisia
Springboard is a self-development programme
for women. This year, 1,000 participants completed
experience of more than 75 years, our design of the
conference encouraged NATO – and others – to and the palestinian territories
the training programme in the Middle East, starting consider the dynamics of soft and hard power, and to decide on their careers
new partnerships between women’s organisations how cultural relations can build understanding and trust.
in the UK and the region. A 16-year-old boy from Afghanistan summed up the © Jenny Matthew

This programme’s first UK study tour helped women’s issue by saying that his trust in ISAF and NATO would
organisations in this country and the Middle East share have been different if more effort had been made
experiences and build a greater understanding about to understand and connect with the people. Our partners on Word Express were Literature Across boundaries about the role of women at work remain
the role of women today in the different societies. Frontiers, who are based at the Mercator Institute for a challenge to progress.
The soft power of cultural relations may never replace
Media, Languages and Culture, Aberystwyth University.
We adapted the Springboard Consultancy’s award- the hard power of military action but there is a growing Over the last year, our Women at Work project has
winning UK programme for the Arab region to become recognition of the complementarity between the two: Creative Collaboration was able to attract over continued to go from strength to strength since its
the only programme of its kind there. It is supporting cultural relations are necessary to secure long-term 50 per cent of its funding through partners in the launch on International Women’s Day in 2007. In order
many of the region’s governments in their efforts stability and win the peace. UK and south-east Europe, all of whom wanted to to help women to access opportunities in the market,
to open up new opportunities for women from a be part of something new, exciting and of genuine we promoted and encouraged new relationships
range of backgrounds. Participants will go on and value to millions of people. between professional women from the UK and Egypt,
inspire others to make a greater contribution to Jordan, Lebanon, Morocco, the Palestinian Territories,
Crossing borders with words and Many of the projects focused on equal opportunities
Syria and Tunisia. We have drawn on the expertise
the political, economic and social development of
movement in south-east europe and diversity. We took StopGAP – the UK’s top
and experience of UK partners including the Association
a dynamic and hugely important region to the UK. contemporary dance company, which has dancers
More than 200,000 people in the UK and south-east of Women Judges, Women into the Network and the
with and without disabilities – to Romania, Bulgaria
Europe have taken part in Creative Collaboration. Royal Institute of British Architects.
and Albania, where they trained dancers to teach
This cross-border, 18-country arts initiative has united integrated dance as a means of inclusion for people To mark the final year of the programme we developed
Connecting Classrooms
artists, producers and creative entrepreneurs in more with disabilities in society. a guide for women to help them decide on their career
revolutionises teaching practices
than 30 projects. path, how to get started and testimonials from several
Education ministries from Afghanistan, Bangladesh StopGAP went on to perform on national television
of the hundreds of Women at Work participants. The
and Pakistan have agreed to work more closely together We know that culture and cultural exchange have at the Academy of Art in Tirana, not long after Albania
advice draws on professional UK expertise and looks
in modernising teacher training practices as a result an important role to play in helping people understand had passed its own anti-discrimination legislation.
at career options from the creative industries to law,
of exchanges with UK schools. each other better, improving social cohesion and Media coverage for Creative Collaboration has now
from scientific disciplines to public policy and from
driving economic growth. reached more than 28 million people.
An external evaluation by the Institute of Education in education to finance.
Dhaka demonstrates that Connecting Classrooms, after From Albania to Azerbaijan and Croatia to Cyprus, British
We have supported participants with a series of seminars,
two years, is achieving a ‘paradigm shift’ in participating expertise in the creative industries has demonstrated
and in Syria last year Hana Hallaj said: ‘It would be an
schools in Bangladesh, moving teaching practices that the arts can have, in the words of Turkish novelist Women at Work understatement to say that this conference changed
from traditional methods to the use of a wider range Bariß Müstecaplıo©lu, real ‘economic heft’.
The economic development and success of countries my life forever ... I would like to thank the British Council
of modern schooling practices. Bariß was participating in Word Express, which brought across our Near East and North Africa region depends for giving me this opportunity to develop my new
20 young writers from countries including Serbia, Bosnia on the contribution of women in the work place and business and build a network of important successful
More than 1,800 teachers and head teachers
and Herzegovina, Turkey, Greece, Armenia, Bulgaria throughout society. However, female participation across women in their careers.’
have taken part in capacity-building and leadership
and Israel together for a train journey that connected the region and the wider Middle East is the lowest
activities, drawing on exchanges with teaching staff Powerful testimony from women who are working
countries and regions where past political conflict in the world at only 23 per cent (EUROMED study).
from the schools they are grouped with in the UK. towards success, thanks to their partnership with the UK.
has prevented cultural contact. We also know that traditional stereotypes and cultural

24 25
our perforMAnCe MeAsurInG perforMAnCe
Every one of our performance measures for 2009–10 is up.
We have directly engaged 18.4 million people overseas, which is an increase
of 5.2 million on last year.
We have reached 652 million people, which is an increase of 431 million.
Against the backdrop of difficult economic circumstances and a major internal
change programme, these results are something to be proud of.

How we measure our performance We have taught English to almost 300,000 students
across our teaching centre network and over 1.5 million
Our corporate scorecard tracks the scale and scope,
people sat exams administered by us.
quality and impact of our cultural relations work.

Over the last year we have been even more rigorous reach: bringing information to individuals
and placed tighter emphasis on monitoring and We have reached 652 million people through
evaluation across all of our work. the internet and radio, television programmes
and publications.

scale and scope For example, the Our Shared Europe programme debate
The scale of our work is measured through the numbers on Muslims in Europe was broadcast by BBC World and
of people who: reached an audience of 70 million.

n we engage with by bringing people together in In total, our Climate Generation programme reached
cultural relations activity, face to face or online nearly 70 million television viewers. In China, we reached
16.2 million through a five-part documentary on our
n we reach by bringing information to individuals Climate Champions. The documentary was produced
through communication channels such as radio by the British Council in partnership with China Central
and television broadcasts, publications and websites. Television Channel 10.

engagement: bringing people together Our English language websites – LearnEnglish,


We have engaged 18.4 million people overseas, LearnEnglish Kids, TeachingEnglish and Premier
which is an increase of 5.2 million. Skills – reached over 13 million people across
the world in 2009–10.
Our global programmes are performing well
and engaging very large numbers of people. For uK audiences
example, Darwin Now engaged 3.1 million people We collected data for UK audiences for the first time this
and Connecting Classrooms 1.4 million. These results year. We will be tracking and reporting on our audiences
were achieved through school linking, exhibitions, in full from 2010–11. The highlights are:
online person-to-person activity, exchanges and
volunteering programmes. n We have engaged over two million people in the UK
in our work.
Our local cultural relations work engaged up to
3.8 million. Customer surveys reflect that local cultural n More than 350,000 people have visited the Whitechapel

relations work is also highly valued by organisations exhibition of works from the British Council’s collection
across the range of our activity. Our contract work during our 75th anniversary celebrations.
accounts for up to half a million people overseas, which n We have reached more than eight million people
rises to one million if you count the UK and the full scope in the UK through a range of activities including
of work undertaken by programmes such as DFID School our school linking programmes, the International
Partnerships and the European Union-funded Comenius. Student Awards and our London 2012 legacy
Our work in promoting educational opportunities for programme, International Inspirations.
the Prime Minister’s Initiative 2 Connect programme
has supported 93 higher education projects in 2009–10.
These projects generate partnerships between the
UK and countries overseas in research, collaborative
delivery of teaching programmes, student exchanges
and strategic links at an institutional level.
We reached 652 million
© Frank Noon

people this year


27
Quality
GlobAl perforMAnCe results
Heads of Mission survey
The 2009–10 survey was completed by 91 Heads
We measure the quality of our work through:
of Mission. This year’s global average score of 81 was
n a customer satisfaction indicator two percentage points higher than the previous year.
n a reputation indicator, which shows whether Heads of Mission feedback is summarised in a score 2007–08 2008–09 2009–10
we are perceived as being a leader in our field which aggregates ratings of the British Council’s impact
Impact perspective
across its three main programme areas and perceived
n an advocacy indicator score, which is a measure
value for money for the UK government. Overall assessment by senior decision makers and influencers (ELTO) 78 77* 78*
of the willingness of our audiences to recommend
the work of the British Council to others. Much of this feedback is encouraging. It gives us Strengthening of ties with the UK resulting from new or continuing
confidence that our work is making a difference on the engagement with the British Council 68 69* 70*
This year we collected feedback from over 300,000
ground and contributing to the broader international Personal beneficial changes resulting from new or continuing
participants from a wide range of our programmes.
agenda of UK government. engagement with the British Council 82 81* 83*
The results are positive and there has been an
increase in each quality score. This is a reflection For example, a Head of Mission in Africa said: ‘Excellent Organisational beneficial changes resulting from new or continuing
of the British Council placing even more emphasis programmes, high reputation, proactive approach engagement with the British Council 83 81* 82*
on the quality of engagement rather than just and ability to have real impact among a wide range Foreign and Commonwealth Office assessment of British Council
focusing on audience numbers. of people.’ impact and value for money 76 79 81

research building trust for uK through


Impact of our work
cultural relations reputation and satisfaction perspective
We have evaluated our impact through: We commissioned research* in China, India, Poland Overall customer satisfaction with their engagement
and Saudi Arabia to find out whether young people who with the British Council 80 81* 83*
evaluation of long-term outcomes took part in cultural relations programmes increased
(elto) research n Quality of engagement 83*
their level of trust in the UK.
ELTO is conducted every year. Qualitative research is n Engagement met expectations 83*
undertaken by external professional research agencies The results of this research show a clear relationship
in each of the four countries between levels of trust Customers perceive the British Council as a leader
in each British Council region. A total of 100 of our most
in the UK and participation in cultural relations activities. in its field 81 82* 83*
important stakeholders were interviewed. The research
assesses whether the recipient’s engagement has led to: The exact strength of this relationship varies by country Customers would recommend the British Council (net advocacy) 47%* 50%*
and programme mix.
n personal beneficial changes resulting from new
Generalising across the four countries, the level of
or continuing engagement with the British Council Audience perspective
trust in the UK among those young people who have
n organisational beneficial changes resulting from new participated in cultural relations activities is 10–20 per Engagement (millions) 15.6 13.2** 18.4
or continuing engagement with the British Council cent higher than among similar young people who have n Leaders engaged (thousands) 12 9 13
n strengthening of ties with the UK resulting from new not participated. The results also show that the level
n Influencers engaged (thousands) 255 282 443
or continuing engagement with the British Council. of trust in the UK is positively related to the number
of cultural relations activities in which the young people n Aspirants engaged (millions) 15 13 18
Compared with last year, we have increased our results have participated. Reach through broadcast, online and publications (millions) 112 221 652
in all three areas. Indications are that our programmes
such as Connecting Classrooms are demonstrating International students in UK higher education 389,330 415,585 n/a***
substantial success in bringing about these changes. International students in UK further education 76,785 76,305**** n/a***
The majority of the regional reports highlighted Teaching centre students and examination candidates (millions) 1.5 1.9 1.8
the power of exchanges in helping people to
immerse themselves in each other’s cultures.
* Weighted score: in 2006–09, in response to NAO feedback, we have weighted the score to reflect the numbers of people with whom we
This leads to positive personal and organisational work in different regions.
outcomes as well as strengthening of ties with the UK.
** This figure has been rebased to reflect a tighter definition of direct engagement that excludes some participants in major festivals and
In most regions our participants continue to report exhibitions. On a like-for-like basis the 2007–08 result would be restated at 13.8 million.
that they would like us to focus on sustaining *** Figures not available at time of going to print.
relationships with them beyond the completion
**** This includes England, Scotland and Northern Ireland. The numbers from Wales are not yet available.
of projects and programmes.

*Respondents to the research were chosen and interviewed independently by YouGov and their overseas partners

28 29
unIteD KInGDoM CentrAl AnD soutH AsIA
The year 2009–10 was an important one for our work in the UK. We engaged Regional performance
over two million people in our work this year and reached 8.3 million.

Our work is respected by the world’s political and Our work benefits the UK’s creative and knowledge funding
thought leaders. We have brought their views on issues economy. For example:
Country HMG grant * (£ millions) Other income Total
like public diplomacy and climate change to UK
n Our international higher education strategy is Iran 0.1 0.0 0.1
audiences. For example, President Calderón of Mexico Uzbekistan 0.8 0.2 1.0
brokering policy dialogue with governments overseas.
gave a British Council lecture on climate change in the Kazakhstan 0.9 0.6 1.5
It is creating new teaching partnerships. It provides
lead-up to the G20. Afghanistan 1.5 0.2 1.7
market intelligence to UK institutions to increase
Professor Joseph Nye gave our inaugural Parliamentary the flow of students in and out of the UK. This is part Nepal 0.4 2.3 2.7
Lecture in January, at which he said, ‘the British Council of our contribution to a sector that is worth at least Bangladesh 2.1 7.0 9.1
discovered [soft power] and has been practising it £5 billion in export earnings to the UK economy. Pakistan 2.9 14.7 17.6
effectively since 1934, which is being celebrated with Regional budget 1.3 0.0 1.4
n Over 200 further education and sixth-form colleges Total 2009–10 10.1 24.9 35.1
this 75th anniversary. It is intriguing to hear Hillary
took part in British Council initiatives. This included 2008–09 9.5 27.1 36.7
Clinton say that smart power, or the combination
our ground-breaking Skills for Employability, where 2007–08 7.6 24.0 31.6
of hard and soft, is the new policy.’
we’re opening up new markets for UK FE partners, 0 5 10 15 20 25 30 35 40
Shami Chakrabati, Director of Liberty, delivered the first including Pakistan.
HMG + Other = Total
ever British Council lecture in Derry/Londonderry on the
n Over 350,000 people saw the British Council
role of public diplomacy. The event coincided with the
Collection shows in the Whitechapel Gallery; and
75th anniversary celebrations of both the British Council
Resound at the Barbican was a highlight of our
and Liberty.
Birthday celebrations. In Kazakhstan, more than 10,000 students a year
n Selector gigs in Cardiff and Edinburgh showcased
We reached over 43 in 70 state colleges will benefit from a new construction

We have offices in British talent that we are taking to the world.


We engaged more than 320 UK arts organisations million people and english
curriculum piloted by a Skills for Employability
partnership between Wakefield and Almaty. International
belfast, Cardiff, on over 100 different initiatives.
language projects trained Inspiration has trained 14,000 young leaders in schools
and communities and a further 500 sports and
edinburgh, london n The biennial British Council Edinburgh Showcase
over 22,000 teachers educational professionals in Bangladesh alone.
and Manchester generates an estimated £1 million for the UK
theatre industry.

Our work in the UK broadens the world view


engagement: bringing people together
of thousands of young people. For example: Customer satisfaction engagement: bringing people together
n Over 7,000 schools across the UK are involved Score from 0–100 (Measured in millions)
in long-term programmes for the direct exchange 84 2009–10 1.1 2009–10
of knowledge, people and ideas. 84 2008–09 0.8 2008–09
80 2007–08 0.9 2007–08
n Through us, over 1,800 of these schools had
0 100
a partnership with one or more schools in one
or more of 84 countries worldwide.
reach: bringing information to individuals
breakdown 2009–10
n More than 2,300 UK students were language (Measured in millions)
assistants overseas, gaining an extended experience Quality of activity 84
of another culture, developing themselves and the 43.1 2009–10
Meeting expectations 84
38.4 2008–09
UK’s cultural ties.
2.0 2007–08
n Global Xchange helps young people and youth
workers from the UK and across the world to live,
learn and work together on programmes that promote Leaders (T1) 972
volunteering, development awareness and active Influencers (T2) 61,739
citizenship. More than 500 participants from the UK Aspirants (T3) 2,013,616
and another 28 countries in the Middle East, Asia and
Africa participated in Youth and Community Xchange
programmes to gain a deeper understanding of issues
affecting sustainable community development.

* Refers throughout this section to the core UK government grant we receive through our sponsoring
department, the Foreign and Commonwealth Office.
30 31
CHInA eAst AsIA
Regional performance Regional performance

funding funding
Country HMG grant (£ millions) Other income Total Country HMG grant (£ millions) Other income Total
Hong Kong 2.0 13.1 15.1 New Zealand 0.3 0.0 0.3
China 7.4 42.1 49.5 Australia 0.7 0.2 0.8
Regional budget 2.4 0.8 3.2 Philippines 0.4 1.6 2.0
Total 2009–10 11.8 56.0 67.8 Taipei 0.6 1.8 2.4
2008–09 8.5 49.5 57.9 Indonesia 1.8 0.6 2.4
2007–08 5.9 34.9 40.8 Burma 0.3 2.8 3.1
0 10 20 30 40 50 60 70 80 Vietnam 1.6 4.1 5.8
Thailand 1.0 5.4 6.4
HMG + Other = Total
Republic of Korea 1.2 5.3 6.5
Malaysia 1.0 5.8 6.8
Japan 3.2 5.4 8.6
We reached 20 million learners of English, working with Singapore 0.8 10.4 11.1

our large-scale a range of partners including publishers, websites and


mobile providers such as Nokia. Connecting Classrooms
Regional budget
Total 2009–10
1.4
14.3
0.6 1.9
43.8 58.1
programmes helped us has created over 1,000 school partnerships between 2008–09 13.3 42.3 55.6
2007–08 11.6 32.9 44.5
to reach over 134 million the two countries and our Experience! 2009 campaign
brought the benefits of studying in the UK directly 0 10 20 30 40 50 60
people in China last year to 190,000 people.
HMG + Other = Total

Access English, Creative Cities and partnership


Customer satisfaction engagement: bringing people together
Score from 0–100 (Measured in millions)
our work directly agreements for our new Social Entrepreneurship
programme all contributed to improvements in direct
81 2009–10 1.5 2009–10 engaged 1.3 million more engagement and increased partnership income – this
80
77
2008–09
2007–08
1.3
3.6
2008–09
2007–08
people and we reached was up ten per cent. We are leading on the UK–Vietnam
agreement to support the development of an
0 100 almost 100 million people international standard state university in Vietnam,
based on our own university models.
reach: bringing information to individuals
breakdown 2009–10
(Measured in millions)
Quality of activity 82
134.5 2009–10
Meeting expectations 81
46.7 2008–09 Customer satisfaction engagement: bringing people together
32.6 2007–08 Score from 0–100 (Measured in millions)
81 2009–10 2.3 2009–10
80 2008–09 1.7 2008–09
77 2007–08 2.2 2007–08
0 100

breakdown 2009–10
reach: bringing information to individuals
(Measured in millions)
Quality of activity 81
99.5 2009–10
Meeting expectations 80
38.4 2008–09
13.8 2007–08

32 33
InDIA AnD srI lAnKA lAtIn AMerICA
Regional performance AnD tHe CArIbbeAn
Regional performance
funding
Country HMG grant (£ millions) Other income Total funding
Sri Lanka 0.5 6.7 7.2 Country HMG grant (£ millions) Other income Total
India 7.7 12.2 19.9 Cuba 0.2 0.0 0.2
Regional budget 0.2 5.7 5.9 Chile 0.3 0.2 0.5
Total 2009–10 8.4 24.6 33.0 Caribbean* 0.4 0.2 0.6
2008–09 6.9 24.7 31.6 Argentina 0.6 0.1 0.6
2007–08 6.5 16.3 22.8 Mexico 1.3 1.9 3.1
0 5 10 15 20 25 30 35 Venezuela 0.7 2.6 3.4
Brazil 3.5 1.2 4.7
HMG + Other = Total
Colombia 0.6 5.2 5.8
Regional budget 1.2 0.0 1.2
Total 2009–10 9.0 11.3 20.2
2008–09 9.2 10.3 19.5
Broadcast partners at Tata Sky, the Discovery Channel 2007–08 9.1 8.8 17.9
project english has now and MTV India helped our work reach 54 million
people across India. International Inspirations, UKIERI
0 5 10 15 20 25

reached more than 17 and Connecting Classrooms contributed to direct


*Jamaica and Trinidad and Tobago HMG + Other = Total

million language learners engagement exceeding planned targets. New, low-cost


teaching offers opportunities to people of limited means.
Our Colombo and Kandy teaching centres are operating
at capacity, meeting high demand for English.
We are working with Colombia’s Ministry of Education

We are working with in their 23 teacher training programmes to help 7,000


English language teacher trainers across the country.

Customer satisfaction engagement: bringing people together


115,000 Mexican school- Our partnership with the Commonwealth Foundation

Score from 0–100 (Measured in millions) children on our climate connected young people to the debate at CHOGM
on our People’s Forum blog. Connecting Classrooms
83 2009–10 2.4 2009–10 change programmes is up and running in Venezuela, enabling new
82 2008–09 conversations with the UK and positive bilateral
2.5 2008–09
81 2007–08 1.8 2007–08 engagement between our countries.
0 100

reach: bringing information to individuals


breakdown 2009–10 Customer satisfaction engagement: bringing people together
(Measured in millions)
Quality of activity 84 Score from 0–100 (Measured in millions)
54.7 2009–10
Meeting expectations 83 10.8 2008–09 83 2009–10 2.3 2009–10
1.5 2007–08 83 2008–09 0.8 2008–09
81 2007–08 0.4 2007–08
0 100

reach: bringing information to individuals


breakdown 2009–10
(Measured in millions)
Quality of activity 85
35.2 2009–10
Meeting expectations 83 3.8 2008–09
0.4 2007–08

34 35
MIDDle eAst neAr eAst AnD nortH AfrICA
Regional performance Regional performance

funding funding
Country HMG grant (£ millions) Other income Total Country HMG grant (£ millions) Other income Total
Yemen 0.6 0.4 1.0 Algeria 0.7 0.1 0.8
Iraq 1.1 0.2 1.3 Tunisia 0.7 0.9 1.6
Oman 0.4 1.7 2.1 Lebanon 1.0 0.8 1.8
Bahrain 0.4 2.2 2.6 Palestinian Territories 2.0 0.2 2.1
Kuwait 0.6 2.7 3.3 Syria 1.5 1.4 2.9
Qatar 0.6 5.0 5.6 Morocco 0.9 2.0 2.9
United Arab Emirates 1.2 8.9 10.1 Libya 0.7 2.9 3.6
Saudi Arabia 1.7 9.6 11.3 Jordan 1.1 3.4 4.5
Regional budget 3.1 0.0 3.1 Egypt 2.0 7.6 9.6
Total 2009–10 9.7 30.7 40.4 Regional budget 1.5 0.0 1.5
2008–09 9.1 23.0 32.1 Total 2009–10 12.1 19.2 31.3
2007–08 7.5 17.9 25.4 2008–09 10.9 15.7 26.6
0 10 20 30 40 50 2007–08 8.6 13.8 22.4
0 5 10 15 20 25 30 35
HMG + Other = Total
HMG + Other = Total

We are helping to assure the quality of Saudi Arabia’s

In one month our 58 universities and colleges, including the expansion of


women’s access to education. In Qatar, we are delivering
Teachers are helping their students develop English

go4english website a £3 million contract to help 600 Qatari teachers at the We have reached skills using the Premier Skills website following
Algeria’s qualification for the World Cup. We are leading
attracted more than State’s independent schools switch to English-medium 19.3 million more people on the delivery of a UK–Libya agreement to provide
teaching of mathematics and science. My Father’s House
500,000 users gave UK and Middle East artists a platform across the in the near east and co-operation and support for education reform. English
for the Future is providing a pathway to a successful
region involving more than 25,000 people.
north Africa career for young learners to recent graduates, and
for trainee teachers to qualified English teachers.

Customer satisfaction engagement: bringing people together


Score from 0–100 (Measured in millions) Customer satisfaction engagement: bringing people together
Score from 0–100 (Measured in millions)
79 2009–10 0.8 2009–10
79 2008–09 0.7 2008–09 81 2009–10 0.9 2009–10
77 2007–08 0.6 2007–08 80 2008–09 1.2 2008–09
0 100 79 2007–08 1.0 2007–08
0 100
reach: bringing information to individuals
breakdown 2009–10
(Measured in millions) reach: bringing information to individuals
Quality of activity 80 breakdown 2009–10
(Measured in millions)
4.4 2009–10 Quality of activity 82
Meeting expectations 79
0.4 2008–09 20.8 2009–10
0.6 2007–08 Meeting expectations 80 1.2 2008–09
0.8 2007–08

36 37
russIA AnD nortH europe soutH-eAst europe
Regional performance Regional performance

funding funding
Country HMG grant (£ millions) Other income Total Country HMG grant (£ millions) Other income Total
Estonia 0.2 0.0 0.2 Kosovo 0.3 0.0 0.3
Latvia 0.3 0.0 0.3 Macedonia 0.3 0.1 0.4
Norway 0.4 0.0 0.4 Albania 0.4 0.1 0.5
Denmark 0.4 0.0 0.4 Bosnia and Herzegovina 0.5 0.3 0.8
Lithuania 0.2 0.2 0.4 Austria 0.4 0.6 1.0
Finland 0.5 0.0 0.5 Croatia 0.7 0.6 1.3
Slovenia 0.5 0.1 0.7 Serbia and Montenegro 0.7 0.7 1.4
Sweden 0.8 0.0 0.8 Israel 0.9 0.7 1.6
Hungary 0.6 0.3 0.9 Bulgaria 0.8 1.7 2.5
Slovakia 0.5 0.7 1.2 Ukraine 0.7 1.7 2.5
Russia 2.2 0.1 2.3 South Caucasus * 1.6 1.0 2.6
Czech Republic 0.8 2.1 2.9 Romania 0.9 2.8 3.7
Poland 1.6 3.6 5.2 Cyprus 0.5 3.6 4.1
Regional budget 1.0 0.0 1.0 Turkey 3.2 1.8 5.0
Total 2009–10 10.1 7.1 17.3 Greece 0.7 7.6 8.3
2008–09 11.4 8.5 19.9 Regional budget 1.7 0.0 1.7
2007–08 14.9 8.7 23.6 Total 2009–10 14.2 23.5 37.7
0 5 10 15 20 25 2008–09 15.8 23.0 38.8
2007–08 15.7 22.0 37.6
HMG + Other = Total
0 5 10 15 20 25 30 35 40

*Armenia, Azerbaijan, Georgia HMG + Other = Total

Global English for Europe has helped more than


Cop15 resounded to the 135,000 parents support their children’s learning thanks
to more affordable ways to access materials. We are Our English and Exams business generated £20 million,
voice of our International helping people and professionals to improve their
skills for employability including contracts with NATO and OSCE. In total, the
region’s income from partners, both in cash and in kind,
Climate Champions surroundings through Creative Cities, which reached
over 20 million people in the media. Ministries of reached more than amounted to £4.1 million. Our successful Football for
demanding change Education across the region signed up to Connecting
800,000 people in 12 Peace project in Israel, now in its tenth year, will continue
Classrooms so that we can help them bring an with EU co-funding as Playing for Peace. Between them,
international dimension into the classroom. countries in the region our Beautiful Science and Darwin Now programmes
reached 27 million people.

Customer satisfaction engagement: bringing people together


Score from 0–100 (Measured in millions)
Customer satisfaction engagement: bringing people together
82 2009–10 0.8 2009–10 Score from 0–100 (Measured in millions)
81 2008–09 0.7 2008–09
83 2007–08 1.0 2007–08 83 2009–10 1.7 2009–10
0 100 83 2008–09 1.4 2008–09
83 2007–08 1.0 2007–08
reach: bringing information to individuals 0 100
breakdown 2009–10
(Measured in millions)
Quality of activity 83 reach: bringing information to individuals
26.7 2009–10 breakdown 2009–10
Meeting expectations 81 (Measured in millions)
6.6 2008–09 Quality of activity 84
7.1 2007–08 36.3 2009–10
Meeting expectations 83 27.8 2008–09
5.6 2007–08

38 39
sub-sAHArAn AfrICA West europe
Regional performance AnD nortH AMerICA
Regional performance
funding
Country HMG grant (£ millions) Other income Total funding
Rwanda 0.1 0.3 0.4 Country HMG grant (£ millions) Other income Total
Botswana 0.3 0.4 0.8 Malta 0.1 0.0 0.1
Mauritius 0.4 0.5 0.8 Ireland 0.4 0.0 0.4
Cameroon 0.3 0.7 1.0 Canada 0.6 0.0 0.6
Senegal 0.7 0.3 1.1 Switzerland 0.8 0.4 1.2
Mozambique 0.5 0.6 1.1 United States 1.6 0.1 1.6
Eritrea 0.2 1.2 1.3 Germany 2.1 1.4 3.5
Malawi 0.6 0.8 1.4 Belgium and Netherlands 1.9 1.9 3.8
Ethiopia 0.7 0.7 1.4 France 1.4 4.9 6.4
Uganda 1.0 0.5 1.4 Portugal 0.6 8.5 9.1
Tanzania 0.8 0.7 1.5 Italy 1.1 11.4 12.5
Zambia 0.7 0.9 1.6 Spain 2.0 53.2 55.3
Zimbabwe 1.3 0.4 1.7 Regional budget 1.1 0.0 1.1
Sudan 1.1 0.6 1.7 Total 2009–10 13.6 81.9 95.5
Ghana 1.1 0.8 1.8 2008–09 13.6 72.3 85.9
Kenya 1.2 0.8 2.0 2007–08 13.2 57.1 70.3
South Africa (incl. Namibia) 2.5 1.0 3.5 0 20 40 60 80 100
Sierra Leone 0.5 4.3 4.8
HMG + Other = Total
Nigeria 3.6 9.0 12.6
Regional budget 5.1 0.0 5.2
Total 2009–10 22.7 24.5 47.2
2008–09 20.3 32.6 52.9
2007–08 17.9 27.2 45.1
We are playing a leading role in developing the cultural
0 10 20 30 40 50 60
HMG + Other = Total our teaching and exams relationship between the European Union and China.
Our Shared Europe is creating greater understanding
businesses grew by of the Muslim contribution to European society, culture

Over 750,000 young people and teachers connected 18 per cent despite tough and identity. Global Changemakers lobbied UK and
world leaders for a better, brighter future at the G20
We are investing in the their classrooms with the UK. We are delivering English economic conditions in London. We helped students, teachers and politicians
by radio to countries where internet penetration is from across Europe to think about inclusion and
development of Angola, low and demand for UK exams reached over 500,000 diversity in schools.

the Democratic republic people. Our development work for DFID is making
a real difference to people, to governments and quality
of Congo and rwanda of life in Sudan, Nigeria and Sierra Leone.
Customer satisfaction engagement: bringing people together
Score from 0–100 (Measured in millions)
77 2009–10 3.1 2009–10
Customer satisfaction engagement: bringing people together 76 2008–09 1.9 2008–09
Score from 0–100 (Measured in millions) 77 2007–08 2.0 2007–08
0 100
86 2009–10 1.2 2009–10
82 2008–09 1.2 2008–09 reach: bringing information to individuals
81 2007–08 1.3 2007–08 breakdown 2009–10
(Measured in millions)
0 100 Quality of activity 77
117 2009–10
Meeting expectations 77
reach: bringing information to individuals 15.4 2008–09
breakdown 2009–10 5.5 2007–08
(Measured in millions)
Quality of activity 86
79.1 2009–10
Meeting expectations 86 39.6 2008–09
1.4 2007–08

40 41
our report GoVernAnCe
The British Council is a charity and an executive non-departmental public body
audited by the National Audit Office.

The rules for Board membership are set out in the Royal patron Her Majesty the Queen
Charter. Members are elected by the Board following
Vice-patron His Royal Highness The Prince of Wales
an open recruitment process.

They must be British citizens and are chosen for their


ability to contribute experience and expertise to the
objects
British Council. The objects (as defined in its Royal Charter) for which
the British Council is established and incorporated
The term of appointment to the Board is three years,
are to advance any purpose that is exclusively charitable
with the possibility of renewal for a further three years.
and that shall:
Appointment to the offices of Chair and Deputy Chair
n promote a wider knowledge of the United Kingdom
requires the prior approval of the Foreign Secretary.
n develop a wider knowledge of the English language
The Chair, Deputy Chair and members of the Board
are not remunerated. However, out-of-pocket expenses n encourage cultural, scientific, technological and
are reimbursed where incurred on British Council other educational co-operation between the United
business. If a Board member undertakes work Kingdom and other countries
in a professional capacity at the request of the n otherwise promote the advancement of education.
British Council, fees for such work may be paid.
The purpose of the British Council is to:
The Board Code of Practice requires members
to declare any interest that may conflict with their n build engagement and trust for the UK through
responsibilities as Board members. the exchange of knowledge and ideas between
people worldwide.
This information is available for inspection.
Our Trustees have given careful consideration to
the Charity Commission’s general guidance to ensure
principal address that there is clear evidence of how the aims of the
10 Spring Gardens British Council are carried out through the activities
London SW1A 2BN undertaken for public benefit.
Telephone +44 (0)20 7930 8466

Governance
Auditors The Royal Charter vests all the powers of the British
Comptroller and Auditor General Council in a Board of Trustees. The Board has three
National Audit Office sub-committees: Audit, Remuneration, and Nominations,
157–197 Buckingham Palace Road to which it has delegated certain responsibilities.
Victoria, London SW1W 9SP
The British Council has robust governance
arrangements to promote high performance
bankers and safeguard propriety and regularity.
HSBC Corporate governance was reviewed in 2007.
129 New Bond Street
London W1A 2JA
Audit Committee
The Audit Committee is a sub-committee of the
legal status Board of Trustees, chaired by Claire Ighodaro,
The British Council is registered as a charity under a non-executive Trustee.
registration numbers 209131 (England and Wales)
The principal functions of the committee are to report
and SC037733 (Scotland). The British Council was
to the Board on the adequacy of the British Council’s
established in 1934 and incorporated by Royal
internal control. It reviews and monitors risk management
Charter in 1940.
processes, and reviews arrangements for compliance
A Supplemental Charter of Incorporation was granted with regulatory and financial reporting requirements.
in 1993.

43

© Mat Wright
It also agrees a programme for internal audit and executive board of any relevant audit information and to establish to consider applying to work with us and to reflect
to report on any other financial or accounting matters that the auditors are aware of that information. So far our commitment to existing employees. We guarantee
(at 31 March 2010)
that the Board might specify. as the Chief Executive is aware, there is no relevant an interview to all disabled people who meet the
audit information of which the auditors are unaware. required criteria.
Martin Davidson CMG
remuneration Committee Chief Executive Our terms and conditions of service ensure that staff
The Remuneration Committee of the British Council risk management with disabilities are not discriminated against. Where
Mark robson appropriate, reasonable adjustments are made to enable
is a sub-committee of the Board of Trustees, chaired The British Council has a system of internal control
Director, Operations disabled people to carry out their duties and to compete
by the Chair of the British Council. based on a continuing process designed to identify
and prioritise the risks to the achievement of the British for other jobs and promotion.
The principal functions of the committee are to set Cathy stephens obe
Council’s policies, aims and objectives, to evaluate the We have a Disability Working Group. Their remit includes
annual performance measures and policy for total Director, Programmes
likelihood of those risks being realised and the impact raising awareness of disability-related issues across
remuneration and benefits for the Chief Executive.
should they be realised, and to manage them efficiently, the organisation. A range of training and development
They agree his annual performance evaluation. bidesh sarkar
effectively and economically. materials to explore disability issues in the workplace
The committee also determines policy for remuneration Chief Financial Officer
of members of the Executive Board. It reviews and Strategic and operational risks are identified through have been developed, including e-learning modules
and a video about working in the British Council
agrees their performance evaluation reports, ratings John Worne the global risk reporting process, the Enterprise
and eligibility for bonus. Risk Management Framework, and discussed by with a disability. Our Disability Advisory Panel is drawn
Director, Strategy and External Relations
the Executive Board quarterly and the Board of from people with a wide range of personal and/or
Finally, the committee considers the impact of its professional experience of disability. The panel meets
Maureen laurie Trustees annually. Financial risks are identified through
work on remuneration policy for the organisation as twice a year to advise and share good practice about
Director, Global HR (from September 2009) the Financial Control and Compliance Framework,
a whole and addresses any other matters referred disability equality.
and reviewed by the Executive Board each month.
to it by the Board. The board of management for the British Council is the
In addition, any specific material risks emerging are
Executive Board. The identification of candidates with
For further details on Executive Board remuneration, addressed as required. equal opportunity
the appropriate balance of skills and experience for both
please see page 53.
the non-executive and executive roles is undertaken The Executive Board is responsible for establishing and and environmental issues
by open recruitment. Members of both the Board maintaining the system of internal control, for reviewing Reports on our equal opportunity and diversity
nominations Committee of Trustees and the Executive Board are provided with its effectiveness and for ensuring necessary actions are commitment and environmental policy can be found
The Nominations Committee is a sub-committee induction and training in their roles. Induction includes taken to remediate significant failings or weaknesses. on pages 54 and 57.
of the Board of Trustees, chaired by the Chair of the briefing and familiarisation with the governance,
To provide assurance to the Executive Board that risks
British Council. structure and operations of the British Council.
are being managed effectively, a Risk Board meets Consultation with employees
It maintains an overview of the composition of the quarterly to review the assessment of risks, consider
The British Council recognises advantages in its staff
Board of Trustees and ensures that the Trustees foreign and Commonwealth office whether the existing and proposed mitigation is
joining trade unions and/or staff associations, and taking
collectively provide the expertise and experience sufficient and make recommendations for strengthening
The British Council is also an executive non- part in their activities.
required for the governance of the British Council, mitigation where necessary. The Risk Board is chaired
departmental public body sponsored by the Foreign
as determined by the Board and the Royal Charter. by Deputy Director Operations and made up of There are mechanisms in each country in which the
and Commonwealth Office (FCO) under the responsibility
senior managers from operational departments British Council operates for consulting staff that reflect
of the Rt Hon. Caroline Flint who was Minister of State
It also leads recruitment of the Chair, Deputy Chair and support services. local practice and employment legislation. Management
for Europe until June 2009 and Chris Bryant,
and Chief Executive, ensuring that these persons also meet with representatives from British Council
Parliamentary Under Secretary of State thereafter. A report from the Risk Board highlighting significant
hold the expertise and experience required. offices in EU countries to discuss transnational European
issues and concerns is considered by the Executive
The FCO/British Council management status was issues via a European Works Council.
The Board receives reports on the work of these Board at its risk meeting each quarter.
renegotiated and agreed in October 2006 and the
sub-committees. The Board also delegates certain Managers are responsible for consultation with
financial memorandum in November 2007.
authorities to the Chair and to the Chief Executive, who trade unions, staff associations and individual staff
in turn can delegate them wholly, or in part. Trustees Connected charities and organisations members on proposals for change. Where managers
are additionally given guidance on their responsibilities Audit The British Council co-operates with many organisations are proposing changes that have significant implications
and accountabilities. in the pursuit of its charitable objectives. Other for staff, it is British Council policy to consult on any
These accounts have been audited by the Comptroller
than related parties the British Council has no direct such proposals.
and Auditor General by agreement with HM Treasury
relationship with any organisation other than by way
and are, with the annual report, laid in the Library of the The British Council produces a range of internal
of normal contract.
House of Commons. communications to inform and involve our staff.
The British Council is the sole corporate trustee of They encourage debate and discussion of issues
The audit fee for 2009–10 was £130,000.
a number of small trusts of which the three largest are that are relevant to colleagues in addition to providing
The Companies Act now permits the Comptroller and the United Kingdom 9/11 Scholarships Fund, the Lefèvre the information that they need to do their jobs.
Auditor General to audit the accounts of companies. Trust and the Sir Shiu Kin Tang Educational Trust.
Therefore, following direction from the Foreign A monthly bulletin of strategic and management
and Commonwealth Office, the accounts of BC Trading information is sent by email to regional and country
International Limited were audited by the National Audit Disabled employees directors and UK managers. The British Council
Office for 2009–10 for a fee of £6,500. We are committed to ensuring disabled employees publishes weekly online news and information on
are able to progress in and develop their careers. its intranet site. We also keep staff informed through
Through his staff, the Chief Executive has taken all steps British Council LiFE, our quarterly print magazine.
The Positive about Disabled People symbol is displayed
that he ought to have taken to make himself aware All staff have access to email and the intranet.
on our recruitment advertisements and our web pages.
This is an attempt to encourage disabled people

44 45
the board of trustees british Council country committees
(at 31 March 2010) and advisory groups
(at 31 March 2010)

Chair board Members who served during part


of the year northern Ireland Wales Committee english language
Vernon ellis ‡ ††
Committee
rt Hon. lord Kinnock of bedwellty Chair Chair
Chair of the British Council Chair Professor Elan Closs Stephens CBE Dr Catherine Walter
Deputy Chair
until 7 July 2009 Brian Hanna CBE
Alan buckle ‡ †† Members Members
Global Head of Advisory, KPMG Gerard lemos CMG
Members Gary Davies Steve Brent
Deputy Chair of the British Council and Acting Chair
Professor Alastair Adair Richard J. Davies Professor Chris Kennedy
from 8 July 2009 until 24 March 2010
Members The Hon. Mr Justice Deeny Aled Eirug John McGovern
Zeinab badawi Rosalie Flanagan Lynne Hamilton Peter Mothersole
nihal Arthanayake
Broadcaster and journalist Rosemary Kelly OBE John Howells Professor Alison Phipps
Musician, broadcaster and DJ
until 30 November 2009 Jim Kitchen Yasmin Hussein Dr Philida Schellekens
professor pamela Gillies ‡ †† Dr Aideen McGinley OBE Euryn Ogwen Williams Andrew Thompson
professor sir timothy o’shea
Principal and Vice-Chancellor, Seamus McKee Berwyn Rowlands Professor Brian Tomlinson
Principal and Vice-Chancellor, University of Edinburgh
Glasgow Caledonian University Jonna Monaghan Professor Stephen Tomlinson
until 31 August 2009
Duncan Morrow secretary
lord Hall of birkenhead Cbe
Helen Osborn secretary Melissa Cudmore
Chief Executive, Royal Opera House
‡ Member of the Nominations Committee Joan Reilly Dr Kevin Higgins
brian Hanna Cbe †† Member of the Remuneration Committee Trevor Ringland
Chair of the Northern Ireland Committee † Member of the Audit Committee science and engineering
Professor Gillian Robinson
education and Governance
Alan Shannon Chair
sue Hoyle †
Paul Sweeney Chair Dr Gill Samuels CBE
Director, Clore Leadership Programme
Professor Michael Worton
Claire Ighodaro Cbe † secretary Members
Independent director Shona McCarthy Members Anjana Ahuja
professor steve Jones Dr Rob Berkeley Professor Steve Albon
David Cargo Professor Jim Al-Khalili
Professor of Genetics, University College London scotland Committee
Professor Lynn Davies Professor Polina Bayvel
patrick McKenna †
Dr Rita Gardner CBE Professor Neil Champness
Chair
Chief Executive, Ingenious Media plc Steve Grainger MBE Professor Mike Hulme
James Boyle
raoul shah Jacqui Henderson CBE Tony Juniper
Founder and Chief Executive, Exposure Members Rajiv Joshi Professor Mike Lamb
Sir David Edward Professor Liz Kelly CBE Dr Vicky Pope
Sir John Grant Graham Leicester
secretary Ken Greer Nina Panayis secretary
Andy Mackay obe Mukami McCrum Professor Sir Peter Scott Dr Lloyd Anderson
Sheena McDonald
Graham MacNaughton secretary
John Payne
Arts advisory Group
Francesca Osowska
Dr Dave Reay Graham Sheffield was appointed
Rt Hon. George Reid as Arts and Creative Economy
Professor Joan Stringer CBE FRSE Advisor in June 2009. An advisory
Professor Allan Walker group will be formed in 2010–11
as a result of his work.
secretary
Paul Docherty

Professor Kenneth Brown left the Northern Ireland Committee in October 2009
Will Haire left the Northern Ireland Committee in February 2010
Leslie Evans left the Scotland Committee in September 2009

46 47
statement of the trustees’ responsibilities statement on internal control
Scope of responsibility

Under the Charities Act, the Trustees are responsible The Trustees are responsible for reporting on public As Accounting Officer, I, Martin Davidson, have is in place to strengthen the British Council’s capacity
for the preparation of financial statements for each benefit, having regard to the guidance issued by responsibility for maintaining a sound system of internal to manage risk, to improve the co-ordination of risk
financial year in the form and on the basis prescribed the Charity Commission to ensure that there is clear control that supports the achievement of the British management initiatives and to create and sustain
by regulations made by the Secretary of State for the evidence of how the aims of the British Council Council’s policies, aims and objectives, while safeguarding a culture of effective risk management throughout
Home Department. are carried out, through the activities undertaken the public funds and assets for which I am personally the organisation.
for the public benefit. responsible, in accordance with the responsibilities
The accounts are prepared on an accruals basis and A range of risk management training is provided
assigned to me in Managing Public Money.
must give a true and fair view of the British Council’s Details of any related party transactions undertaken by to staff to ensure that they are equipped to manage
incoming resources and application of resources during the Trustees are detailed in note 20 to the accounts. I am also responsible for ensuring compliance with risks appropriate to their duties and level of authority.
the year and of its state of affairs at the end of the year. parliamentary requirements, the Financial Memorandum Guidance is revised as necessary to take account
between the Foreign and Commonwealth Office (FCO) of changes and improvements to risk and control
In preparing those financial statements the Trustees statement of the Accounting officer’s and the British Council, and the accounting and reporting practices, and regular updates are provided on risk
are required to: responsibilities requirements of the Charity Commission and the Office management issues.
n observe the accounts direction issued by the The Accounting Officer for the Foreign and of the Scottish Charity Regulator (OSCR).
The Board of Trustees undertakes an annual review
Secretary of State for Foreign and Commonwealth Commonwealth Office has designated the Chief
As Chair of the Board of Trustees, I, Vernon Ellis, have of strategic risks facing the British Council to satisfy
Affairs, including the relevant accounting and Executive as the Accounting Officer for the British
responsibility for satisfying myself and the Board that itself that these risks have been adequately mitigated.
disclosure requirements; select suitable accounting Council. His relevant responsibilities as Accounting
a sound system of internal control is maintained within In addition, the Board of Trustees, through the Audit
policies and then apply them consistently; make Officer, including his responsibility for the propriety
the British Council. Committee, reviews the effectiveness of the risk and
judgements and estimates that are reasonable and regularity of the public finances and for
control processes in the organisation.
and prudent; state whether applicable accounting the keeping of proper records, are set out in the
standards and statements of recommended practice Non-Departmental Public Bodies’ Accounting Officers’ the purpose of the system
have been followed, subject to any departures Memorandum issued by HM Treasury and published of internal control the risk and control framework
disclosed and explained in the financial statements; in Managing Public Money. As part of a process of continuous improvement, new
The system of internal control is designed to manage
prepare the financial statements on the going concern risk management arrangements were implemented with
risk to a reasonable level rather than to eliminate all risk
basis, unless it is inappropriate to presume that the effect from April 2009 to strengthen financial control and
of failure to achieve policies, aims and objectives; it can
British Council will continue in operation. give greater emphasis to the management of operational
therefore only provide reasonable and not absolute
The Trustees’ responsibilities include keeping proper assurance of effectiveness. risk through two discrete, but complementary, frameworks:
accounting records. These disclose with reasonable Vernon ellis n Financial Control and Compliance Framework (FCCF).
The system of internal control is based on an ongoing
accuracy at any time the financial position of the Chair, British Council
process designed to identify and prioritise the risks to the n Enterprise Risk Management Framework (ERMF).
British Council and enable it to ensure that the financial 23 June 2010
achievement of policies, aims and objectives, to evaluate
statements comply with Accounting and Reporting
the likelihood of those risks being realised and the impact financial Control and Compliance framework
by Charities: Statement of Recommended Practice
should they be realised, and to manage them efficiently, The primary tool for managing financial risk during
(revised 2005) (SORP) and United Kingdom Generally
effectively and economically. the year ended 31 March 2010 was the Financial Control
Accepted Accounting Practice (UK GAAP). The Trustees
are also responsible for safeguarding the British The system of internal control has been in place in and Compliance Framework. This framework provides
Council’s assets and hence for taking reasonable steps the British Council for the year ended 31 March 2010 evidence on compliance with minimum standards
for the prevention and detection of fraud and breaches and up to the date of approval of the annual report of financial control, which enables the Board, Financial
of law and regulations. and accounts, and accords with Treasury guidance. Controller and management at regional and country
levels to be in a position to give certification
of compliance.
Capacity to handle risk
The framework has supported the Risk Board and
The British Council’s Executive Board is responsible
the Executive Board by monitoring minimum standards
for the management of the risks facing the British Council
of financial control and compliance with financial
and ensuring that effective risk management processes
policies and procedures across the British Council
are in place throughout the organisation. Ultimate
through self-certification at both country and UK
accountability, including responsibility for determining
department levels. The consolidation of returns and
the British Council’s risk appetite, resides with the Board
the resulting reports and dashboards have ensured
of Trustees.
that risks and non-compliance issues are easily identified,
Specialist functions oversee and provide support for the escalated and tracked by both the centre and regions
management of key areas of risk, developing corporate through to resolution.
policies and standards, and ensuring that appropriate
frameworks and arrangements are in place to enable enterprise risk Management framework
managers to manage the risks which may impact on The Enterprise Risk Management Framework comprises
the achievement of their objectives. a ‘bottom-up’ process for identifying, assessing,
controlling and reporting on operational risks
An Enterprise Risk Management team, comprising
by countries and UK departments, complemented
specialists in security, business continuity, health and
by a ‘top-down’ process for managing strategic risks.
safety, fire safety, insurance and risk management,
48 49
All business units are required to create and maintain The main focus during the coming year will be to embed All business units in the UK and overseas are required requirements set out by the Cabinet Office, including
a risk register describing the risks to the achievement risk management more fully in all the British Council’s to have business continuity plans in place, which are the Data Protection, Freedom of Information and
of their objectives, assessing the level of inherent activities. Work needs to be done to improve the reviewed and updated annually. A sample audit of some Public Records Acts, and the Government’s Data
and residual risk, summarising the existing and proposed completeness and quality of risk registers, while at the plans is also carried out. In 2009–10, business continuity Handling Review. The Senior Information Risk Owner
controls (with target dates) and identifying the owner same time encouraging all staff to see risk management plans were drawn up by many directorates to deal is a member of the Executive Board and chairs the
of each risk. as an integral part of effective management. A key focus specifically with the threat of pandemic flu. In addition, Information Assurance Committee, which reports to the
for the ERM team, therefore, will be to provide further a major incident team was convened to co-ordinate the Risk Board and is responsible for monitoring compliance
As a minimum, registers are reviewed and updated every
training and support for staff throughout the organisation British Council’s response to the threat. with relevant legislation and the implementation of the
quarter and are completely refreshed at the start of
in managing risk. Addressing Information Risk programme, a comprehensive
each year to ensure that they are aligned with the In 2009–10, 60 per cent of plans were tested annually.
set of initiatives aimed at improving all aspects of
business unit’s objectives for the coming year. In addition Following a risk assessment of the business continuity
information governance and management in the
to scrutiny by the business unit itself, each register is risk priorities planning framework, however, annual testing will only
British Council.
reviewed by the directorate to which it reports to ensure The priorities for risk management in the British Council be carried out in future in business units where testing
the visibility of risks across the directorate, improve the during the past year included: is required to demonstrate the required level of resilience. During the past year, training has been provided for
quality of risk reporting and facilitate the sharing of good staff responsible for handling sensitive data and an
practice in risk management. economic environment status and tax information risk awareness campaign has been rolled
Managing the effect of the global recession continued During the past year, work has continued on the out throughout the UK. Retention schedules have been
The Strategic Risk Register is revised annually by the
to be a significant focus of risk management for review of the British Council’s status. The Status and Tax developed for key business units and a global review of
Executive Board and each risk on the register is owned
the Executive Board and business managers during programme aims to establish a robust platform for contracts has been initiated to ensure that information
by a member of the Executive Board, who is accountable
2009–10. The continuing weakness of sterling against the growth of income-generating activities in line with shared with partners and suppliers is managed in
for ensuring that effective mitigation is put in place to
major currencies has substantially reduced the strategic priorities and to address the reputational accordance with the British Council’s legal obligations.
manage the risk across the organisation. Risk tolerances
purchasing power of the grant-in-aid. In addition, and financial risks associated with our status in some A revised protective marking scheme is due to be
for each strategic risk are set by the Executive Board,
demand for teaching services has been weaker than countries. The review of status options has been implemented shortly. Progress is being measured against
based on the Statement of Risk Appetite approved by
planned, although higher than 2008–09. However, completed in 90 directorates and the remaining 20, the standards set out in the government’s Information
the Board of Trustees.
the overall impact of the global recession has had mainly small-scale directorates, are due to be reviewed Assurance Maturity Model (IAMM). By the end of
In addition to operational and strategic risks, change minimal impact on targets. This has been achieved by 30 June 2010. A five-year implementation plan 2009–10, the British Council had achieved compliance
programme risks are also managed through the through a number of interventions, including: has been agreed and to date implementation has been with the entry level standards of the IAMM (Level 1) in
Enterprise Risk Management Framework. The Scale completed in 46 countries. the UK. Our target is to achieve IAMM Level 2 in the UK
of Ambition Board is responsible for ensuring that risks n taking advantage of market opportunities to deliver and Level 1 in all overseas operations by April 2011.
more exams services than planned Progress has also been made on the development of
to the achievement of Scale of Ambition objectives are
a group structure for the British Council and the financial
managed effectively and individual programme and n delivering more activity through large scale
Intellectual property
and legal framework needed to support it. A holding
project managers are responsible for maintaining risk programmes so that higher audience numbers In December 2009, a complaint from a photographer
company, BC Holdings (United Kingdom) Ltd, was
registers for their programmes and projects. are delivered at lower unit cost highlighted a potentially serious risk relating to the
incorporated in December 2009 and FCO approval was
unauthorised use of images on the British Council’s
The Enterprise Risk Management team is responsible for n reducing back office and operational support costs
given for the establishment of subsidiaries in China, India,
websites. Although the original complaint was resolved,
analysing and providing a commentary on the risk data Thailand and the USA. A funding policy for subsidiaries has
n introducing a global cashflow forecasting process so
the incident prompted the Risk Board to order an urgent
from all business units for the Risk Board, which provides been approved by HM Treasury and a transfer pricing
that future liquidity requirements and foreign exchange review to confirm that all images on British Council
assurance to the Executive Board that risks to the policy has also been developed to provide a transparent
exposures are better anticipated. This has allowed websites are appropriately licensed and being used
achievement of the British Council’s objectives are being mechanism for charging between different entities.
better utilisation of natural hedges and the ability in accordance with the terms of our licence. This was the
managed effectively. The Risk Board meets quarterly In view of the increased complexity of the group structure
to enter into forward contracts for dollars and euros, first invocation of the new ERMF risk escalation process.
to monitor changes to the British Council’s risk profile, and the risks associated with it, ensuring that the British
review the mitigation of strategic, operational and change increasing budget certainty on future exchange rates. Council’s governance, risk management and control Following this incident, action is being taken to increase
programme risks and mandate action to improve framework are aligned with the new arrangements awareness of intellectual property issues and strengthen
mitigation where necessary. It also considers reports security and business continuity and remains fit for purpose will be a key focus the governance arrangements for the use of third party
from the Security and Health and Safety committees. Political instability, conflicts and natural disasters continue for management attention during the coming year. intellectual property. An intellectual property policy
to pose a threat to our staff and customers, and to has been drafted and a specialist intellectual property
The Risk Board is chaired by Deputy Director Operations programme delivery, in many parts of the world. Given fraud and money-laundering manager will be appointed to develop an action plan,
and made up of senior managers from across the the priority attached to working in countries which have The British Council remains vulnerable to fraud in some together with guidance and training materials for all staff.
organisation. A report from the Risk Board highlighting a deficit of trust with the UK, some operations are exposed parts of the world, particularly in cash economies, and as
key issues and concerns is considered by the Executive to terrorist attack, while in others our programmes are a consequence, may suffer financial loss. Enhancements Child protection
Board at its risk meeting each quarter. disrupted by civil unrest and other forms of conflict. During to processes and controls are introduced regularly An increasing proportion of the British Council’s
the past year, we have continued to maintain operations in to prevent and detect fraud, and the responsibility to programmes involve work with young people.
embedding risk management Afghanistan, Iraq and Pakistan, while in Georgia our office minimise any consequential loss is taken very seriously. Safeguarding the children who come into contact
All staff are responsible for managing risks within the had to close temporarily due to the conflict with Russia. Despite these measures, the risk of fraud cannot be with the British Council, whether directly or through
scope of their responsibilities as employees of the British Priority is given to ensuring the safety of staff, customers entirely eliminated and during the past year, a fraud our partners, therefore, is a top priority. To date, risk
Council and as professionals working to professional and partners through a combination of risk assessments, of £55,000 was identified in Sierra Leone (£11,000 mitigation in this area has focused largely on completing
codes of conduct. briefing, training, and the use of appropriate protective of which was a loss to the British Council). To further criminal records checks for teachers employed in British
The Financial Control and Compliance Framework measures. Security is an intrinsic element of all premises protect the British Council from fraud, a fraud and Council teaching centres. However, recognising the
and the Enterprise Risk Management Framework have projects and a service level agreement with FCO Estates anti-money-laundering awareness programme was limitations of this approach and the need to extend the
been in place for one year. Both are working well and and Security Division provides for the cyclical inspection launched in 2009–10. scope of child protection measures to all British Council
have significantly enhanced the British Council’s capacity of all properties globally. The Security Committee, which activities, a specialist Child Protection Manager was
to manage risk. Minor adjustments have been made reports to the Risk Board, is responsible for monitoring Information management appointed in January 2010. Work has now started on
to each framework during the course of the year and the effectiveness of security arrangements. The British Council is committed to protecting and using the development of a comprehensive child protection
further improvements will be made during 2010–11. its information securely and effectively, in compliance strategy, which will be rolled out in 2010–11.
50 with its legal obligations and the standards and 51
expenses
A review of expenses, including Executive Board
to update and clarify its delegated authorities under
its Financial Memorandum with the FCO, so that
executive board remuneration report
expenses, conducted by Internal Audit revealed some it is consistent with Managing Public Money. The British Council, as an executive non-departmental a member of the Executive Board could be eligible for
areas of non-compliance. Urgent remedial action is being public body, is not required to apply the government’s a non-consolidated performance-related payment as
taken to address the issues identified and to enhance centralised pay system, adopted in 2002, to its Senior part of their total remuneration if he or she is successful
the monitoring and sample checking of claims.
review of effectiveness
Civil Service (SCS) equivalent staff at pay bands 10 and in meeting a number of targets and objectives.
As Accounting Officer, the Chief Executive has
above. However, the British Council does mirror some
Health and safety responsibility for reviewing the effectiveness of the Any increase to Executive Board remuneration is directly
of the broad principles of the system. The British Council
The British Council is committed to providing a safe system of internal control. His review of the effectiveness related to performance and is applied in the form of
broadly follows the SCS pay ranges for pay band 10
working environment for its staff, customers and of the system of internal control is informed by the work an increase to base pay and a non-pensionable payment
and members of the Executive Board.
partners. The Health and Safety Committee, reporting of the internal auditors and members of the Executive linked to achievement of specific targets and objectives.
to the Risk Board, is responsible for reviewing health and Board who have responsibility for the development There are three SCS pay ranges, which are determined In the case of the Chief Executive, this is up to a
safety policies and monitoring compliance with health and maintenance of the internal control framework, using the Job Evaluation of Senior Posts (JESP) system. maximum of 20 per cent of base salary and in the case
and safety standards throughout the organisation. During and comments made by the external auditors in their As a general rule: of other Executive Board members, up to 15 per cent
the past year, a revised fire safety policy and standards management letter and other reports. The Chief Executive of base salary.
n all British Council pay band 10 jobs fall into
for British Council buildings have been developed, and the Chair of the Board of Trustees have been advised the SCS pay band 1 Executive Board members are appointed on a fixed-
together with a risk assessment framework for the use on the implications of the result of the Chief Executive’s term contract of three years. The notice period for
review of the effectiveness of the system of internal n jobs on the Executive Board fall into SCS pay
of partner premises. In addition to the health and safety termination, for either side, is three months. Early
training provided for staff in the UK, the first of a series control by the Risk Board, the Executive Board and the bands 2 and 3.
termination, other than for misconduct, may result
of training courses for overseas staff was delivered Audit Committee, and a plan to address weaknesses and Executive Board members’ annual salary increases in the individual receiving compensation as set out
and a targeted programme of health and safety ensure continuous improvement of the system is in place. are determined by their position in the pay band and in the Civil Service Compensation Scheme.
and fire safety audits initiated in selected UK offices The effectiveness of the system of internal control performance rating. There are five performance ratings:
and overseas directorates. Emoluments (salaries, including allowances and
was maintained and reviewed through: outstanding; exceeds expectations; good performer;
performance bonuses subject to UK taxation) paid
improvement/development required; and unsatisfactory.
business transformation n comprehensive operational and financial planning to members of the Executive Board and their pension
The management of the risks inherent in the Business and reporting processes within the organisation Performance is assessed on how far objectives and entitlements are set out below. All those individuals
Transformation programme is the responsibility of the targets have been met or exceeded in the individual’s are members of the Principal Civil Service Pension
n key policies and procedures, to support the flow
Programme Lead, reporting to the programme board. performance agreement and how far duties have been Scheme. An overview of retirement benefits can
of timely, relevant and reliable information across completed to standards agreed in the job description.
Risk registers have been put in place for all projects be found in section 2 (l) and full details in note 7
the organisation
and are reviewed regularly by the programme board. to the financial statements.
One of the five ratings is then given, which will determine
Any significant emerging risks or changes in risk n formalised authorisation processes, with the
the level of pay award given each year. In addition
exposure are highlighted in monthly reports to the Scale maintenance of delegated authorities covering
of Ambition Board. A major concern during the past year financial transactions and contracts
name and position salary salary Accrued Accrued real real CetV at CetV at real
has been the potential disruption to business and n year end self-certification by all country and UK 2009–10 2008–09 pension lump sum increase increase 31/03/10 31/03/09 increase
the impact on staff morale as a result of restructuring directors giving assurance that our organisation’s (in bands of (in bands of (to the nearest (to the nearest
as at as at in pension in lump in CetV
and the voluntary early retirement programme. accounting procedures have been understood
£5,000) £5,000)
(in bands of
£1,000) £1,000)*
31/03/10 31/03/10 sum funded by
The implementation of the programme, therefore, has and followed (in bands of (in bands of
£2,500)
(in bands of
employer
been closely monitored by the Scale of Ambition Board. £5,000) £5,000) £2,500)
(to the nearest
Detailed guidance and support has been provided n the work of Internal Audit, which provides an £1,000)

both to line managers and to staff taking voluntary independent and objective opinion on the adequacy
Davidson, M.s.
early retirement. Arrangements have also been made of processes on risk, control, governance and 165–170 ** 185–190 55–60 165–170 2.5–5 10–12.5 1,151 1,018 67
Chief Executive
to protect IT systems, financial information and other finance systems
robson, M.W.
sensitive data and to facilitate knowledge retention n the Audit Committee, which provides oversight 150 –155 135–140 5–10 n/a 2.5–5 n/a 99 58 33
Director Operations
during this period of transition. and guidance where necessary on the work of Finance
and Internal Audit, providing an interface between the sarkar, b.
125–130 115–120 5–10 n/a 2.5–5 n/a 55 30 19
special payments organisation and the National Audit Office Chief Financial Officer
During the year the British Council made payments stephens, C.A.
totalling £504,214 that fall within the category of special n work of the National Audit Office, as external auditor, 145–150 135–140 65–70 195–200 2.5–5 12.5–15 1,529 1,350 89
Director Innovation
payments as defined in Managing Public Money. in forming an opinion on the financial statements
The British Council relied upon its Financial Memorandum and in reporting the results of their value for money Worne, J.p.
examination. Director Stategy 130–135 115–120 25–30 n/a 2.5–5 n/a 322 267 34
with the Foreign and Commonwealth Office and had
not understood that it required formal advance approval and External Relations
Based on the above, we are satisfied that we can sign
from HM Treasury for these special payments. However, the Statement on Internal Control. laurie, M.***
70–75 **** – 0–5 n/a 0–2.5 n/a 24 n/a 21
it subsequently sought retrospective approval and Director, Global HR
HM Treasury gave approval for all but one compromise
agreement (for details see page 86).
The information in this table has been subject to audit. CETV – Cash equivalent
The British Council has taken steps to ensure that all staff transfer value.

making policy decisions that come within the scope Martin Davidson CMG Vernon ellis * The figure may be different for the closing figure in last year’s accounts.
This is due to the CETV factors being updated to comply with The Occupational
of Managing Public Money are briefed on its obligations Chief Executive Chair of the Board of Trustees Martin Davidson CMG
Pension Schemes (Transfer Values) (Amendment) Regulations 2008.
and requirements. The British Council is also seeking 23 June 2010 23 June 2010 Chief Executive
** Martin Davidson waived 2009–10 performance-related payment.
*** Appointed 01/09/09. **** Full year equivalent 125-–30. 23 June 2010

52 53
eQuAl opportunIty our people
AnD DIVersIty In 2009–10 we took the decision to redevelop our business model,
to reduce overheads and to reduce the number of permanent posts
As an international organisation working in over 100 countries, we place in the UK by one-third to allow us to invest our resources in activity.
equality and diversity at the heart of everything we do, wherever we do it.

We are committed to treating our staff, our customers Diversity assessment framework As a result of our restructuring, a total of 330 colleagues Leadership scores in the UK have dropped by ten per
and our partners fairly, removing barriers to equal are leaving through a voluntary early retirement (VER) cent and there has been a decline of four per cent
The diversity assessment framework is a global
treatment and acting to redress existing imbalances. programme. By the end of March 2010, 113 colleagues in the Executive Board’s score. This is not unexpected
tool that supports our attempts to embed equality
had departed the organisation and a further 217 people given the level of change in the UK and the tough
Our agenda is based on the idea of societies and and diversity principles into all aspects of our work.
will have left by October 2010. decisions that the top team has made over the last year.
working environments where people are understood The cumulative framework consists of five levels,
and their differences are respected. In recognising, with a number of indicators at each level, against The net result of the change programme will be a The Executive Board will continue to invest considerable
valuing and managing diversity between people and which evidence is presented and assessed. reduction of over 500 posts in the UK. We will not be time and resource in addressing colleagues’ concerns
cultures, we seek to demonstrate these principles replacing colleagues leaving on VER, other than in during 2010–11 as the full impact of our change
DAF results for 2009–10 were encouraging,
and deliver impact for the UK. business-critical posts, and we are reducing the number programme comes into effect.
with 100 per cent engagement level maintained,
of non-permanent staff. In addition, we took the decision
We focus on seven main areas of diversity – age, and an organisational average of 2.3 for the The results show that there is a strong relationship
to impose a pay freeze, affecting all UK-appointed staff
disability, ethnicity/race, gender, religion/belief, sexual second year running. between employees and the British Council. As a place
for 2010–11 during the year.
orientation and work–life balance – and have developed to work, 70 per cent of our colleagues would speak
The DAF is an internal benchmarking tool;
an equal opportunities policy and a diversity strategy highly of the organisation, as opposed to 55 per cent
however, it has attracted considerable interest
around them. Documents explaining both policies can
from the public and private sector in the UK and from staff survey in the private sector.
be found on our website. The 2009–10 staff survey was completed by 4,768
around the world. We have been asked to share our Levels of satisfaction with working for the British Council
approach to equal opportunities and diversity with colleagues. This is in line with previous years and are at 65 per cent, which compares well with 67 per
Measuring progress partners in a host of countries, including China–Hong continues to represent a return rate significantly cent in the private sector and is just above the public
Kong, Nigeria, Kuwait, Saudi Arabia and Turkey. higher than in the public and private sectors. sector at 64 per cent.
By measuring and monitoring our actions we can make
progress in bringing equality and diversity into the This is the second year of our new engagement index, Colleagues feeling valued and recognised (55 per cent)
mainstream. We have a number of ways of doing this, equality monitoring which consists of five questions asked by Ipsos MORI compares well with private and public sector benchmark
including equality monitoring, an integrated equality for the staff survey, focusing on goals and objectives, data of 41 per cent and 48 per cent respectively.
Equality monitoring is used to review the reflective
scheme and a diversity assessment framework (DAF). communication, management, fairness and change
diversity of our workforce. We have been monitoring
management.
our UK-contracted staff since 2001 and analyse Absence monitoring
Integrated equality scheme the data annually to track progress and take action Our engagement index is 65 per cent. This is a
The British Council has a sickness absence monitoring
to address under-representation. two-point drop. However, we compare well with other
To meet our UK equality legislation obligations, process in place in the UK, managed by Absence Line.
we have established an integrated equality scheme. organisations. We outperform the Ipsos MORI private
We also monitor minority ethnic, women and disabled Monthly internal reporting on the data is produced and
Details of this scheme are available on our website, sector norm by eight percentage points and their
staff progressing to pay band 10 posts. The target for analysed to assess trends and inform management.
with progress reports that explain how we are seeking public sector norm by 14 percentage points.
minority ethnic staff was 12 per cent and we achieved For the year 2009–10, 2.72 per cent of staff days were
to eliminate unjustified discrimination in the areas 5.6 per cent; for women it was 37 per cent and we Set against a backdrop of considerable organisational lost due to sickness absence.
of disability, gender and race, and how we are seeking achieved 20.4 per cent; and for disabled staff the target change, this is a good result and action taken following
to promote equality and inclusion, specifically the was 5 per cent and we achieved 0 per cent. The first last year’s staff survey has shown an increase in
inclusion of disabled people. two categories show an improvement on 2008–09. engagement by country directors. However, we know
We will continue to monitor progress in this area and that there is still work to do increasing engagement
www.britishcouncil.org/home-diversity-
seek to address any underlying causes. by middle managers throughout the organisation.
our-approach-ies.htm
At 31 March 2010 our UK-contracted staff profile
looked like this:

staff category total total number as a total number as a


percentage 2009–10 percentage 2008–09
Women 743 53.8 53.8
Minority ethnic 218 15.8 16
Disabled 41 3 2.8
Total UK contracted staff 1,380

54 55
our new office in Addis Ababa,
ethiopia, incorporated eft guidance
into the development of its energy
enVIronMentAl polICy
and waste management We are an organisation with a large global footprint and want to tread
lightly wherever we are in the world.

low carbon for cultural relations overseas environmental


We are committed to positive action on climate framework tool (eft)
change in our programmes and we have embedded The Environmental Framework Tool (EFT) provides
environmental principles into our work. guidance to our staff throughout our global network
We have developed a sustainable Transformation on how to manage and mitigate the impact of our
action plan for the organisation which underpins work on the environment.
our commitment to the environment and our ethos EFT is fully operational throughout our overseas network
of low carbon for cultural relations. with 70 per cent of our offices achieving Level one, and
We are cutting our carbon emissions to meet is playing an important role in our new building projects.
environmental legislation in the UK and incorporating Our new office in Addis Ababa, Ethiopia, incorporated
sustainability into the design of our programmes, EFT guidance into the development of its energy and
our procurement and our travel. waste management. The building itself is naturally
We have signed up to 10:10 campaign and encourage ventilated and uses wind catchers set into the roof
our staff, our suppliers and our customers to cut their structure while innovative design features minimise the
own emissions by ten per cent. amount of energy required to heat and cool the building.

Sun pipes in the roof bring natural light to the heart


of the building. They save on the use of electricity and
environmental Management
solar panels provide all of the hot water for the building.
system (eMs)
Since its introduction in 2008, the system has EFT is helping teams throughout the world demonstrate
successfully regained certification to International local leadership. Our office in Kuwait is working towards
standard for EMS ISO 14001 and is minimising Level three and in partnership with the British Embassy
our impact on the environment in the UK. to reduce their combined carbon footprint.

We have developed an environmental management


plan, which sets targets and objectives for reducing eft targets:
carbon, energy, water and waste. There was a n Level one: making a commitment and mobilising
9.4 per cent reduction in electricity use from 2007–08 by 31 March 2009.
to 2009–10 and Spring Gardens had an overall
n Level two: understanding and responding
17.5 per cent decrease from 2006–07 to 2009–10.
by 31 March 2010.

n Level three: performance improvements


GlA 500 by 31 March 2011.
The British Council received a Gold Award at the
n Level four: strong performance.
Green500 Awards in May 2009. Green500 is a London
Development Agency carbon mentoring scheme that n Provisional level five: showing leadership.
recognises organisations in London taking action to
By 31 March 2010 45 per cent of overseas offices
reduce their carbon emissions.
had completed level two. EFT is a guidance tool
We were also nominated for a GLA 500 Special Award and we continue to provide training and support.
– the Indirect Leader Award – and given a special
mention in this category for the development of our
environmental framework tool for our overseas estate.
© James Brittain

56 57
FINANCIAL REVIEW

fInAnCIAl reVIeW
Income has increased by nine per cent and for every £1 of government
grant we receive, we earn £2.50 from other sources.
efficiency savings The Board of Trustees periodically reviews the reserves policy
The British Council’s efficiency programme is designed to to reflect changes in the size of the business, risk profile and
1 Detailed results respond to the decline in the purchasing power of the grant, and investment requirements.
to ensure delivery of its Comprehensive Spending Review (CSR)
At 31 March 2010 the total general reserve was £46 million.
total income received 2009–10 and Operational Efficiency Programme (OEP) commitments.
51% This is a composite figure combining the reserves related
Total income for 2009–10 increased by nine per cent (£60 million) 0% For CSR07 and OEP, the British Council will generate £20.8 million
Grants receivable £211 millionon* its grant by March 2011 (£18.2 million for CSR07, to both the full-cost recovery activities, which comprise teaching,
to £705 million, compared with last year. This increase came of savings
Fees and income from£2.6
services £362 million examinations and contract delivery plus any reserves related
principally from fees and income from services, including from million for OEP). The British Council is on track to meet
to the grant- and partnership-funded activities.
teaching and examinations operations, which rose by £49 million Contract activity £130 million
these targets, with £4.6 million delivered in 2008–09 and
(16 per cent) to £362 million. Examinations performed particularly Other income £2 million
a further £9.8 million of savings made in 2009–10 against the The general reserve includes a debit balance of £17 million.
strongly despite the economic downturn. Contract activity, carried original target of £6.1 million. This has been achieved through: When the accounting basis was changed from cash to accruals
out on behalf of clients such as the European Union, rose by on 1 April 1995, liabilities for terminal gratuities and continuing
n a challenging restructuring programme which involves cutting
eight per cent. The figures above include £25 million of additional early retirement schemes were brought into the accounts on
UK staffing by one-third (500 posts) by March 2011, involving
income resulting from movements in exchange rates. the balance sheet for the first time. Accordingly, a debit balance
30% changes to the way that support services are delivered,
on the general reserve was recorded.
restructuring of operations and changes in working practice
Grants receivable £211 million *
The Trustees, management and the Foreign and Commonwealth
Fees and income from services £362 million n the creation of ‘hubs’ in the UK, Poland, India, China and Mexico
Office are committed to continuing activities at current levels and
19% to manage overseas and UK support functions centrally.
Contract activity £130 million therefore there is no immediate requirement to restrict operations
Other income £2 million The India hub is being further developed into a global shared
to cover these liabilities.
services centre in 2010
The British Council must manage its affairs to ensure that the
n a continuing restructuring programme to reduce office
level of reserves and associated cash balances related to activity
costs overseas
substantially funded by the government grant are kept at an
n value for money savings on travel and IT. acceptable level in accordance with its responsibilities under
Managing Public Money.
total resources expended 2009–10 In addition to these savings targets, the British Council
22%
Total expenditure for the year has increased by 14 per cent is contributing a further £5 million to the Foreign and
(£87 million) to £708 million, compared with last year. This increase Commonwealth
Developing a wider knowledgeOffice in 2010–11.
of English 3 Aims and objectives
language £157 million In 2010–11, we will continue to encourage cultural co-operation
reflects a growth in services and a major programme of investment.
Significant investments have been made to enable future expansion Encouraging educational co-operation and promoting between the United Kingdom and other countries through our
2 reserves
the advancement policy
of education £443 million
of our teaching operations and to reduce the cost of our operating work in three programme areas:
platform, in particular relating to back office activities through Encouraging cultural scientific andlast
The reserves policy, reviewed and agreed by the Board
technological
7% of Trustees in April 2009, ensures the British Council has sufficient Intercultural dialogue: we will strengthen levels of understanding
co-operation £52 million
the creation of a global shared services centre and in project
reserves to allow it to cover
Building capacity for social change £49 millionknown liabilities and contingencies, and trust between people in the UK and other societies, focusing
delivery. The programme of investment has been funded largely
absorb setbacks
Governance costs £6 million and take advantage of change and opportunities. our activities on younger people and encouraging them to realise
from fees and income from services. The figures above include
7% The assessment of the appropriate level of reserves is made the benefits of intercultural relationships. Our priority regions
£14 million of additional expenditure resulting from movements
63% with reference to the following categories: will be Central and South Asia, the Middle East, and Near East
in exchange rates. 1% and North Africa.
n to fund working capital requirements
Developing a wider knowledge of English the creative and knowledge economy: we will build openness
n to fund specific liabilities in the future
language £157 million and the sharing of knowledge and ideas, both to position the UK
Encouraging educational co-operation and promoting n to fund future investment as a leading international partner and to ensure that others benefit
the advancement of education £443 million from the exchange. We will continue to promote English as a tool
n to protect the organisation against business continuity risks when
Encouraging cultural scientific and technological for global communication, intercultural understanding and the basis
there is a short-term reduction in income
co-operation £52 million for self-improvement.
Building capacity for social change £49 million n to provide protection for the rest of the business where there
Climate change: we will work with young people and policy makers
Governance costs £6 million is a catastrophe in one part of it, resulting in exit from a particular
to support the growing international consensus on climate change,
business activity.
both the need to tackle its causes and to adapt to the changes
A risk-based approach has been used to estimate the appropriate it will bring.
level of reserves. The current strategic risks have been mapped
against five categories or reasons (above) to hold reserves.
* In this second year of the Comprehensive Spending Review settlement, the British Council has continued with its focus on the three programme areas – intercultural Reserves levels have then been estimated based on likelihood
4 Grant-making policy
dialogue, creative and knowledge economy and climate change – which provide the programme framework for all British Council activity. In 2009–10, the British Council of risks crystallising, future investment needs and external Part of our charitable activity is undertaken by making grants
further increased direct spend on programmes from grants receivable by £7 million to £102 million. The increase in programme spend has been funded through a reduction to individuals and organisations to facilitate their participation
in administration and operational support costs.
perceptions of overall reserves levels.
in events, schemes or programmes set up to achieve our

58 59
objectives. The grants are made to successful applicants, both to cash held by its banks. The counterparty for all forward foreign During the financial year the British Council implemented a foreign During the financial year 2009–10, 97 per cent (2008–09: 97 per
from overseas and the United Kingdom, who fulfil the published exchange contracts is the Bank of England. exchange forward hedging programme to cover up to 80 per cent cent) of valid invoices were paid within this target period. This figure
criteria for each scheme and who are best suited to deliver of euro and US dollar exposures, the objective being to assist includes payment of grants and stipends. The total number of
the outputs intended by the activity. liquidity risk in achieving budget certainty. The British Council’s euro exposure payment transactions processed in 2009–10 was 91,850 (2008–09:
Core grants from government departments, principally the Foreign is limited by significant natural hedges. As at 31 March 2010 91,557). These figures relate only to UK activity.
and Commonwealth Office, comprise 28 per cent of total income the notional value of open US dollar forward contracts amounted
5 financial instruments, credit, liquidity and of the British Council. The remainder is funded via self-generating to £10.6 million, all held for maturity during 2010–11. The British
market risk income. Any liquidity risk is minimal, as overseas current account Council held no open euro forward contracts at 31 March 2010.
7 estates management
The Statement on Internal Control sets out the British Council’s balances are generally maintained at five weeks’ working capital The purpose of the British Council estate is to support the function
Cash balances in currencies where local foreign exchange and business objectives of the organisation. The British Council
approach to managing its main financial risks. In addition the requirement to ensure sufficient cash for operational activities.
regulatory environments make it difficult for the British Council aims to ensure an efficient and effective estate by basing estates
British Council is required to make the following disclosures under Surplus cash is repatriated to the UK where local foreign exchange
to repatriate or convert currency balances into hard currency decision making around core priorities reflecting the needs of the
the UK Financial Reporting Standard 29. controls permit, and invested in the UK. Otherwise surplus funds
positions amounted to a sterling equivalent of £52 million British Council and market opportunities to ensure that the estate
are invested overseas.
The categories of financial instruments held within the at 31 March 2010, including working capital requirements. is value for money, flexible, functional, safe, secure and sustainable.
British Council are: All investments are in accordance with the British Council’s The British Council is actively seeking ways to manage and The majority of the estate, which is largely based overseas, is held
investment policy. Non-restricted cash is held on short-term deposit limit the effect of foreign exchange movements on cash
n Loans and receivables: the British Council values receivables on a leasehold basis. The UK estate consists of two head-office
accounts or via money market deposits with a maturity of not more balances held in those currencies.
initially at fair value and subsequently at amortised cost. buildings in London and Manchester and operational premises
than three months at market rates. The British Council is therefore
The British Council has no intention of trading receivables in Edinburgh, Cardiff and Belfast, all of which are leased. The owned
securing interest returns on cash holdings largely held in the UK
and currently holds no loans. 6 Information on payment policy estate is all overseas and is made up of a mix of residential and
on a short- to medium-term basis. Surplus funds which cannot
commercial properties.
n Assets available for sale: the only assets that the British Council be repatriated to the UK (due to local foreign exchange controls) The British Council’s payment policy in respect of third-party
holds under this category are cash and short-term investments are currently invested for periods up to six months. creditors is to settle on the contractual payment date or within
as described below. These are stated in the accounts at fair value. 30 days from the date of the invoice receipt, provided that
The British Council Group, as at 31 March 2010, held cash and cash
the relevant goods and/or services have been supplied (in line
n Financial liabilities: the British Council’s policy is that short-term equivalents amounting to £196 million, of which £92 million (2009:
with the Better Payment Practice Code).
creditors are recorded at fair value and long-term creditors £53 million) was held in sterling, £43 million (2009: £48 million)
are reflected at amortised cost where reasonable timescales was held in euros and £2 million (2009: £5 million) was held
exist over which to discount and where this is materially in US dollars. Other currency holdings amounted to £59 million
different from carrying value. (2009: £49 million).

n Financial assets and liabilities at fair value through profit or Of the total cash balances of £196 million, £66 million (34 per cent)
loss: the British Council uses forward foreign exchange contracts was held in overseas bank accounts of which £50 million was held
to reduce exposure to movements in exchange rates. These with banks incorporated in the UK and regulated by the Financial
contracts are carried at fair value, and any gains or losses in fair Services Authority.
value are recognised in the Statement of Financial Activities.
£16 million (eight per cent) of total cash was held with overseas
banks outside the UK bank portfolio. Counterparty risks relating
Credit risk
to our banks holding balances overseas are reviewed regularly.
The British Council is exposed to credit risk on trade debtors
over 120 days of £1.5 million. This risk is not considered significant At 31 March 2010 total interest income amounted to £1.6 million,
as a number of these debts relate to European Union projects on of which £0.3 million was earned in the UK and the balance
which the British Council is protected from financial risk provided of £1.3 million attributable to cash invested overseas.
criteria are met. In addition, experience in many overseas regions
demonstrates that aged debts in this timeframe remain valid Currency risk
and collectable. The British Council operates in over 100 countries and carries
out transactions in sterling, US dollars, euros and a variety of
Bad and doubtful debts are provided for on an individual
local currencies.
basis. Write-offs in the year for bad debts amounted to £103,000
(£141,000 in 2008–09). No individual write-off was greater The British Council manages its exposure to foreign currency risk
than £30,000. on cash balances by maintaining operational funding balances
in local currency bank accounts where possible to no more than
Counterparty credit limits, which take published credit rating
working capital requirements.
and other factors into account, are set to cover the total aggregate
exposure to a single financial institution. Exposures and limits Where countries have deregulated foreign exchange controls
applicable to each financial institution are reviewed on a regular any excess funds over and above working capital requirements
basis. The British Council has not suffered any loss in relation are repatriated to the UK, invested and/or held in convertible
hard currency accounts.
We are driving efficiencies and making
savings throughout the organisation
60 61

© Mat Wright
the Independent Auditor’s report to the trustees
of the british Council

I have audited the financial statements of the British Council for I review whether the Statement on Internal Control reflects opinions
the year ended 31 March 2010. These comprise the Consolidated the British Council’s compliance with HM Treasury’s guidance,
In my opinion:
Statement of Financial Activities, the Consolidated and Council and I report if it does not. I am not required to consider whether
Balance Sheet and the Consolidated Cash Flow Statement this statement covers all risks and controls, or form an opinion n the financial statements give a true and fair view, in accordance
and the related notes. These financial statements have been on the effectiveness of the British Council’s corporate governance with the Charities Act 1993 and directions made by the Secretary
prepared under the accounting policies set out within them. procedures or its risk and control procedures. of State for Foreign and Commonwealth Affairs, of the state
I have also audited the information in the Remuneration Report of British Council’s and the group’s affairs as at 31 March 2010
I read the other information contained in the Annual Report
that is described in that report as having been audited. and of its incoming resources and application of resources
and consider whether it is consistent with the audited financial
of the group for the year then ended
statements. I consider the implications for my report if I become
respective responsibilities of the board aware of any apparent misstatements or material inconsistencies n the financial statements and the part of the Remuneration Report

of trustees, Chief executive and auditor with the financial statements. My responsibilities do not extend to be audited have been properly prepared in accordance with the
to any other information. Charities Act 1993 and directions made by the Secretary of State
The Board of Trustees and Chief Executive as Accounting Officer
for Foreign and Commonwealth Affairs
are responsible for preparing the Annual Report, which includes
the Remuneration Report, and the financial statements in basis of audit opinions n information, which comprises the ‘Financial Review’ commentary,
accordance with the Charities Act 1993 and directions made included within the Annual Report, is consistent with the financial
I conducted my audit in accordance with International Standards
by the Secretary of State for Foreign and Commonwealth Affairs statements.
on Auditing (UK and Ireland) issued by the Auditing Practices
and for ensuring the regularity of financial transactions funded Board. My audit includes examination, on a test basis, of evidence
by Parliamentary grant-in-aid. These responsibilities are set
out in the Statement of Trustees’ Responsibilities and Statement
relevant to the amounts, disclosures and regularity of financial opinion on regularity
transactions included in the financial statements and the part
of Accounting Officer’s Responsibilities. In my opinion, in all material respects, the expenditure, income
of the Remuneration Report to be audited. It also includes
and resources funded by grant-in-aid have been applied to
My responsibility is to audit the financial statements and the part an assessment of the significant estimates and judgments made
the purposes intended by Parliament and the financial transactions
of the Remuneration Report to be audited in accordance with by the Board of Trustees and Chief Executive as Accounting
conform to the authorities which govern them.
relevant legal and regulatory requirements, and with International Officer in the preparation of the financial statements,
Standards on Auditing (UK and Ireland). and of whether the accounting policies are most appropriate I have no observations to make on these financial statements.
to the British Council’s circumstances, consistently applied
I report to you my opinion as to whether the financial statements
and adequately disclosed.
give a true and fair view and whether the financial statements Amyas C e Morse
and the part of the Remuneration Report to be audited have been I planned and performed my audit so as to obtain all the information Comptroller and Auditor General
properly prepared in accordance with the Charities Act 1993 and explanations which I considered necessary in order to provide National Audit Office
and directions made by the Secretary of State for Foreign and me with sufficient evidence to give reasonable assurance that 157–197 Buckingham Palace Road
Commonwealth Affairs. I report to you whether, in my opinion, the financial statements and the part of the Remuneration Report London SWIW 9SP
the information given in the ‘Financial Review’ commentary within to be audited are free from material misstatement, whether caused 24 June 2010
the Annual Report, is consistent with the financial statements. by fraud or error, and that in all material respects the expenditure,
I also report whether in all material respects the expenditure, income and resources funded by grant-in-aid have been applied
income and resources funded by grant-in-aid have been applied to the purposes intended by Parliament and the financial
to the purposes intended by Parliament and the financial transactions conform to the authorities which govern them.
transactions conform to the authorities which govern them. In forming my opinion I also evaluated the overall adequacy of the
presentation of information in the financial statements and the part
In addition, I report to you if the British Council has not kept proper
of the Remuneration Report to be audited.
accounting records, if I have not received all the information
and explanations I require for my audit, or if information specified
by relevant authorities regarding remuneration and other
transactions is not disclosed.

62 63
ACCounts

Consolidated statement of financial Activities for the year ended 31 March 2010 Consolidated balance sheet as at 31 March 2010
unrestricted restricted 2009–10 2008–09 Group british Council
total total
2010 2009 2010 2009
Notes £’000 £’000 £’000 £’000
Notes £’000 £’000 £’000 £’000
Incoming resources
fixed assets
Grants receivable 3 211,319 – 211,319 209,429
Intangible fixed assets 10 4,526 4,643 4,526 4,643
Fees and gross income from services and other sources 4 361,844 – 361,844 313,228
Tangible fixed assets 11 174,063 176,115 174,063 176,115
Interest earned 1,608 – 1,608 2,469
Investments 12 231 234 225 234
Funding for contract activity 2(o) – 129,759 129,759 119,698
178,820 180,992 178,814 180,992
total incoming resources 574,771 129,759 704,530 644,824
long-term assets
resources expended
loan to subsidiary 12(d) – – 2,300 –
Charitable expenditure
Cost of activities and grants made in furtherance of the objects: Current assets
Developing a wider knowledge of the English language 153,905 3,559 157,464 132,724 Stock 303 235 303 235
Encouraging educational co-operation and promoting the Debtors 13 111,453 116,009 111,698 117,181
advancement of education 337,883 105,406 443,289 413,668 Derivative financial assets 14 663 – 663 –
Encouraging cultural, scientific and technological co-operation 51,380 502 51,882 42,611 Cash at bank and in hand 195,838 154,953 193,277 153,742
Building capacity for social change 28,852 20,292 49,144 26,925 308,257 271,197 305,941 271,158
Governance costs 6,304 – 6,304 5,651
liabilities: amounts falling due within one year
total resources expended 5 578,324 129,759 708,083 621,579
Creditors 15 (217,191) (206,882) (217,181) (206,855)
Gain on revaluation of assets – – – 8,686
Short-term provisions for liabilities and charges 16(a) (24,341) (2,243) (24,341) (2,243)
net (outgoing)/incoming resources before exceptional items
and notional cost of capital (3,553) – (3,553) 31,931 net current assets 66,725 62,072 64,419 62,060
Exceptional item: profit on disposal of fixed assets 6 2,032 – 2,032 – total assets less current liabilities 245,545 243,064 245,533 243,052
net (outgoing)/incoming resources for the year after
liabilities: amounts falling due after more than one year
exceptional items (1,521) – (1,521) 31,931
Long-term provisions for liabilities and charges 16(b) (20,948) (16,486) (20,948) (16,486)
Notional cost of capital 9 (8,018) – (8,018) (6,298)
net assets excluding retirement benefits scheme asset 224,597 226,578 224,585 226,566
net (outgoing)/incoming resources for the year after
notional costs (9,539) – (9,539) 25,633 Retirement benefits scheme asset 7(h) 2,203 4,819 2,203 4,819

Reversal of notional cost of capital 8,018 – 8,018 6,298 net assets 226,800 231,397 226,788 231,385

net (outgoing)/incoming resources for the year after reversal unrestricted funds and reserves
of notional costs (1,521) – (1,521) 31,931
Capital account 103,206 104,990 103,206 104,990
Actuarial loss recognised in the retirement benefits scheme 17 (2,798) – (2,798) (71)
Revaluation account 75,383 75,768 75,383 75,768
Valuation account movement – on general fixed assets 17 (278) – (278) 71,065
General account 46,008 45,820 45,996 45,808
net movement in funds (4,597) – (4,597) 102,925
Retirement benefits scheme reserve 2,203 4,819 2,203 4,819
Funds brought forward at start of year 231,397 – 231,397 128,472
17 226,800 231,397 226,788 231,385
funds carried forward at end of year 226,800 – 226,800 231,397
The notes on pages 67 to 87 form part of these accounts.
The British Council’s non-consolidated total incoming resources for 2009–10 were £704.5 million; total resources expended were £708.1 million; and total net outgoing
resources after reversal of notional costs were £1.5 million. Approved by the Board of Trustees and signed on its behalf on 23 June 2010.
Restricted activity includes £53 million of income and expenditure relating to projects carried out on behalf of the European Union.

There are no other recognised gains and losses other than those passing through the Statement of Financial Activities. All activities are continuing. The notes on pages
67 to 87 form part of these accounts.
Vernon ellis Martin Davidson CMG
Chair, Trustee Chief executive, Accounting Officer
64 65
notes to the accounts for the year
ended 31 March 2010

Consolidated Cash flow statement for the year ended 31 March 2010 1 basis of preparation and consolidation involved in the management of the business including the
Secretariat, Internal Audit, Legal and Communications departments.
The accounts have been prepared under the historical cost
2009–10 2008 –09
convention modified by the inclusion of certain fixed assets Irrecoverable VAT is allocated to the principal areas in which
£’000 £’000 £’000 £’000 at their current cost. They comply with Accounting and Reporting it is incurred.
net (outgoing)/incoming resources for the year (1,521) 31,931 by Charities: Statement of Recommended Practice (Revised 2005)
The British Council as a registered charity is exempt from
(‘the SORP’), and applicable accounting standards. They are
Less: contribution made to retirement benefits scheme (182) (182) (528) (528) corporation tax under Section 505 ICTA 1988. BC Trading
also prepared to comply with the accounts direction issued by
(1,703) 31,403 International Limited did not incur corporation tax in 2009–10.
the Secretary of State for Foreign and Commonwealth Affairs.
Add/(deduct): As at 31 March 2010, the British Council had four wholly-owned (d) Development of new products and services
Interest receivable (1,608) (2,469) subsidiary undertakings; BC Trading International Limited, BC The cost of development of new products and services is taken
Depreciation charge including impairments 10,609 10,254 English Services Trans-National Limited, BC Holdings (United to expenditure in the year in which it is incurred.
Kingdom) Limited and BCT Events and Promotions India Private
(Gain) on revaluation of assets - (8,686) Limited. BCT Events and Promotions India Private Limited is exempt (e) Valuation, capitalisation and depreciation of intangible
(Gain) on sale of tangible fixed assets (2,032) (363) from consolidation into the British Council group accounts under and tangible fixed assets
Loss/(gain) on revaluation of fixed asset investment 8 (77) Charities SORP, section 383(c). The British Council financial Software licences, valued at cost, have been treated as intangibles.
statements consolidate the results of its other wholly-owned All intangible fixed assets are depreciated using the straight-line
Unrealised (gain)/loss on exchange (566) 2,420 subsidiaries under merger accounting. BC Trading International method over ten years.
Unrealised (gain) on revaluation of financial assets (663) – Limited was the only subsidiary with trading activity during the
All tangible fixed assets are included at their value to the business
(Increase)/decrease in stocks (68) 106 financial year.
by reference to current costs, except the permanent collection
Decrease/(increase) in debtors 4,556 (43,165) Intra-group transactions are eliminated on consolidation and of works of art, which is included at the cost of acquisition, and land
all income and expenditure figures in the Statement of Financial and property, which are included at periodic valuations.
Increase in creditors 10,309 66,238
Activities relate to external transactions only.
Movement in provisions including short-term element 27,126 47,671 (4,840) 19,418 Freehold and long-leasehold land and buildings were valued
The results of a joint venture, IELTS Inc., in which the British Council externally on the basis of open market value for existing use
net cash inflow from operating activities 45,968 50,821
has a long-term interest and over which it exercises joint control, as at 31 March 2009. Subsequent additions are included at cost.
have not been consolidated as they are not material. Land and buildings revaluation on a yearly basis is not practicable,
returns on investments and servicing of finance
because this category of fixed assets is held globally and there
Interest receivable 1,608 2,469 are no indices that would account for this meaningfully.
2 Accounting policies
1,608 2,469 All tangible fixed assets, other than freehold land, the permanent
(a) fees and income collection of works of art and assets in progress, are depreciated
Capital expenditure and investments activities Fees and income are credited to the Statement of Financial using the straight-line method over their estimated useful lives
Investment in subsidiary (6) – Activities when they are earned. as follows:
Payments to acquire intangible fixed assets (700) (1,446)
(b) Grants receivable and payable
Payments to acquire tangible fixed assets (11,887) (8,985) Grants receivable and payable from own resources are taken Freehold and long-leasehold buildings 30–50 years
Receipts from sales of tangible fixed assets 5,902 1,380 to account when due. Long-leasehold land term of lease
(6,691) (9,051) Building improvements 5–25 years
(c) basis of allocation of expenditure
Increase in cash 40,885 44,239 Charitable expenditure comprises all expenditure directly relating Furniture and equipment 4 years
Cash at start of year 154,953 110,714 to charitable activities of the British Council, resources expended Plant and machinery 7 years
on managing and administering the charity and the support
Cash at end of year 195,838 154,953 Motor vehicles 4–7 years
infrastructure in the UK and overseas which enables these activities
to take place. Major IT projects 4–5 years
These financial statements were authorised by the Chair of the Trustees and the Chief Executive for issue on the date that the Comptroller
and the Auditor General signed the Audit Certificate. Support costs have been allocated to the charitable objects based
on a combination of corporate drivers and pro rata basis on total Major IT projects include system developments. The useful life for
expenditure. Corporate drivers (such as income, staff numbers, each has been set to end on the expected date of replacement.
square metreage, etc.) have been applied to ‘developing a wider
Fixed assets costing less than £3,000 are charged to the income
knowledge of the English language’. The balance has then been
and expenditure account in the year of purchase.
apportioned between the remaining three categories of charitable
activity on a pro rata basis.
(f) Investments
Governance costs are directly attributable costs that represent Fixed asset investments are stated at cost less provision
salaries, overheads and expenditure related to central departments for diminution in value.

66 67
(g) financial assets and liabilities (k) exchange differences All current cost accounting adjustments to reflect modified historic them on to a third party, or monies may be disbursed by the
Financial instruments are contractual arrangements that give rise Transactions in foreign currencies are recorded in sterling cost accounting are recorded in, or transferred to, a revaluation British Council and subsequently reimbursed by the client.
to a financial asset of one entity and a financial liability or equity on a monthly basis at rates approximating to the average rate account. In addition, any upward revaluation adjustments for
Expenditure on activities under contracts or agreements is brought
instrument of another entity. of exchange for the month. Assets and liabilities in foreign existing properties are held in the revaluation account. When
to account when incurred. Revenue is recognised as an incoming
currencies are expressed in sterling at the rates of exchange a property is sold the revaluation adjustment is released to capital
The British Council classifies its financial instruments into the resource on the Statement of Financial Activities as an amount
ruling on the balance sheet date. All exchange differences incurred account to offset the adjustment for disposals mentioned above.
following four categories: loans and receivables, assets available equivalent to the expenditure on the activity.
in the year are taken to the Statement of Financial Activities.
for sale, financial assets and liabilities at fair value through profit
(o) revenue and expenditure under contracts or The difference between receipts and expenditure is carried forward
or loss, and financial liabilities.
(l) retirement benefits agreements (restricted funds) in the balance sheet as debtor or creditor balances, depending
Loans and receivables are initially recognised at fair value and Past and present employees are covered by the provisions of These relate to activities falling within the objects of the British on the status of the balance for each individual contract or overall
subsequently measured at amortised cost. Assets available for sale the Principal Civil Service Pension Scheme (PCSPS). The defined Council executed by it on behalf of third parties under contract client agreement.
are carried at fair value. Financial assets and liabilities at fair value benefit schemes are unfunded. The British Council recognises the or agreement. The contract or agreement will specify the purpose
through profit or loss are carried at fair value, with any gains or expected cost of providing pensions on a systematic and rational of the activities. The British Council may collect receipts and pass
losses being recognised in the Statement of Financial Activities. basis over the period during which it benefits from employees’
Financial liabilities are initially recognised at fair value and services by payment to the PCSPS of amounts calculated
subsequently measured at amortised cost. on an accruing basis. Liability to pay future benefits is a charge
on the PCSPS rather than the British Council. In respect of 3 Grants receivable
Fair value is defined as the amount for which an asset is settled
the defined contribution schemes, the British Council recognises
or a liability extinguished, between knowledgeable parties,
the contributions payable for the year in accordance with The principal grant-in-aid is received from the Foreign and Commonwealth Office. There are also specific grants to deliver education
in an arm’s length transaction. This is generally taken to be the
UK Financial Reporting Standard 17. activity on behalf of the education departments of England, Scotland, Wales and Northern Ireland.
transaction value, unless, where material the fair value needs
to reflect the time value of money, in which case the fair value There is also a defined benefit scheme, which is funded and 2009–10 2008–09
is calculated from discounted cash flows. contributory, for UK-appointed employees formerly employed £’000 £’000 £’000 £’000
by the Central Bureau for Educational Visits and Exchanges.
The British Council holds derivative financial instruments in the foreign and Commonwealth office
The expected cost of providing pensions as calculated periodically
form of forward foreign exchange contracts. Derivative financial
by independent actuaries is charged so as to spread the cost over Revenue grant-in-aid 192,963 194,863
instruments are classified as financial assets and liabilities at fair
the expected average remaining service lives of current employees. Capital grant-in-aid 7,800 6,100
value through profit or loss.
200,763 200,963
(m) provisions
(h) stocks
Provisions are recognised when the British Council has a present
Stocks of items for resale are valued at the lower of historical education grants
legal or constructive obligation as a result of past events, it is
cost and net realisable value. Replacement cost is not materially Grants receivable from:
probable that an outflow of resources will be required to settle the
different from historical cost. Purchases of consumable items Department for Children, Schools and Families 7,172 6,941
obligation and the amount has been reliably estimated. Provisions
are taken to expenditure as incurred.
are discounted to present value where the effect is material. Department for Business, Innovation and Skills 2,496 680
The British Council does not recognise any value for work-in-
Provision is made for future liabilities on the basis of costs Department of Education – Northern Ireland 370 359
progress for contract and restricted funds.
estimated at the balance sheet date in respect of payments Scottish Government Schools Directorate (formerly Scottish Executive
to employees in the UK who have retired, or are expected to retire Education Department) 291 280
(i) Gifts in kind
early as part of structured retirement schemes. Payments are due
Companies, organisations and individuals have provided the use Department for Children, Education, Lifelong Learning and Skills
from the British Council from the date of early retirement until age
of facilities, equipment and premises mainly supplied at no cost (Welsh Assembly Government) 227 206
60 when the liability is assumed by the Principal Civil Service
to the donor to facilitate specific activities organised by the British
Pension Scheme. Retirement scheme provisions are discounted 10,556 8,466
Council. The value of these gifts, which is not considered material,
to present value using the official discount rate for pensions. total grants receivable 211,319 209,429
is not included in the accounts.
In many overseas offices the British Council operates terminal
( j) leases gratuity schemes for its locally engaged employees. The value
Land and buildings held under finance leases are capitalised of the final payment is based on final salary and length of
and included in tangible fixed assets at fair value. Obligations employment. Full provision is made in the accounts for the British
related to finance leases, net of finance charges in respect Council’s liability on the basis of service accrued as at the balance
of future periods, are included as appropriate under creditors: sheet date.
amounts falling due within or after more than one year. The interest
element of the rental obligation is allocated to accounting periods (n) Capital account and revaluation account
during the lease term to reflect a constant rate of interest Each year an amount equivalent to the costs expended
on the remaining balance of the obligation for each accounting by the British Council on tangible fixed assets less depreciation
period. Rentals under operating leases are charged to expenditure or impairment, adjusted for disposals, is transferred to or from
as incurred. the capital account.

68 69
4 fees and income from services and other income Included in total resources expended are amounts in respect of:
(b) The average monthly number of employees during the year
was 7,377, analysed as follows:
2009–10 2008–09 2009–10 2008–09
£’000 £’000 £’000 £’000 number of staff
Audit services 206 167 2009–10 2008–09
fees, sponsorship and other income received from activities
in furtherance of the objects: Taxation advice 755 722 Home

Developing a wider knowledge of the English language 134,865 116,522 Consultancy 1,066 372 Management and administrative
Financial advice and (senior managers – 146) 1,117 1,094
Encouraging educational co-operation and promoting
the advancement of education 218,935 187,739 accountancy 319 208
overseas
Encouraging cultural, scientific and technological co-operation 3,565 4,701 total 2,346 1,469
Management and administrative
Building capacity for social change 4,464 3,367 Payments for travel, (senior managers – 267) 4,440 4,575
subsistence, etc. 13,947 10,365
Miscellaneous income 15 899 Teachers 1,820 1,815
Property rental costs relating to
total 361,844 313,228 total 7,377 7,484
operating leases 24,068 21,124
Depreciation charged 10,609 10,254
Included in the above is £4.9 million income received in relation to European Union projects.

It is not practicable to calculate full-time equivalents as casual


staff are employed by the British Council at various times during
5 Analysis of total resources expended
the year. Casual staff are excluded from the above figures.
6 exceptional item
Grants staff other support 2009–10 2008–09
payable costs direct costs total total Profit on disposal of fixed assets consists of gains of £3,125,497 (c) The Chief Executive’s total actual emoluments plus pension
costs and losses of £1,093,897. Included in the gains of £3,125,497 were £209,506, comprising salary of £168,549 and pension
is an amount of £2,400,000 relating to the sale of an office contributions of £40,957. The Chief Executive is a member
£’000 £’000 £’000 £’000 £’000 £’000 property in Mumbai, India. of the Principal Civil Service Pension Scheme.
Cost of activities in furtherance of the objects: (d) The following number of other employees (excluding members
Developing a wider knowledge of the of the Executive Board) received annual remuneration falling within
English language 100 89,322 36,330 31,712 157,464 132,724 7 staff emoluments and related costs the following ranges:

Encouraging educational co-operation and (a) Total staff costs:


promoting the advancement of education 13,343 159,759 227,942 42,245 443,289 413,668 number of staff
2009–10 2008 –09
Encouraging cultural, scientific 2009–10 2008–09
£’000 £’000
and technological co-operation 4,726 22,641 19,370 5,145 51,882 42,611 £40,001–£50,000 77 109
Wages and salaries 235,799 209,839
Building capacity for social change 1,688 13,883 30,906 2,667 49,144 26,925 £50,001–£60,000 114 80
Social security costs 11,940 10,891
Governance costs – 3,547 2,757 – 6,304 5,651 £60,001–£70,000 29 27
Other pension costs 15,067 14,584
total 19,857 289,152 317,305 81,769 708,083 621,579 £70,001–£80,000 15 14
Early retirement costs 26,346 1,172
£80,001–£90,000 10 6
total 289,152 236,486
Included in total resources expended are costs of a structured voluntary early retirement scheme totalling £24.1 million.
£90,001–£100,000 6 6
£100,001–£110,000 4 1

Of staff with remuneration over £60,000, one is a member


of a defined contribution pension scheme and 63 are members
of a defined benefit pension scheme. Contributions of staff in this
range to defined contribution pension schemes during the year
were £5,302.

70 71
(e) Travel expenses reimbursed to six members of the Board CAsH eQuIVAlent trAnsfer VAlues of pensionable pay, were payable to the PCSPS to cover the cost reconciliation of opening and closing balances
of Trustees amounted to £5,182. A Cash Equivalent Transfer Value (CETV) is the actuarially assessed of the future provision of lump sum benefits on death in service of the present value of the scheme liabilities
capitalised value of the pension scheme benefits accrued by and ill-health retirement of these employees.
(f) Pension benefits are provided through the Civil Service pension 2010 2009
a member at a particular point in time. The benefits valued are
arrangements. From 30 July 2007, civil servants may be in one Contributions due to the partnership pension providers at the
the member’s accrued benefits and any contingent spouse’s £’000 £’000
of four defined benefit schemes: either a ‘final salary’ scheme balance sheet date were £5,967. Contributions prepaid at that
pension payable from the scheme. A CETV is a payment made
(classic, premium or classic plus), or a ‘whole career’ scheme date were nil. Scheme liabilities at start of period 11,213 13,747
by a pension scheme or arrangement to secure pension benefits
(nuvos). These statutory arrangements are unfunded with the cost Current service cost 133 126
in another pension scheme or arrangement when the member One individual retired early on ill-health grounds. The total
of benefits met by monies voted by Parliament each year. Pensions
leaves a scheme and chooses to transfer the benefits accrued additional annual pension granted to that person amounted Interest cost 656 728
payable under classic, premium, classic plus and nuvos are
in their former scheme. The pension figures shown relate to the to £1,699.
increased annually in line with changes in the Retail Prices Index Contributions by scheme participants 20 27
benefits that the individual has accrued as a consequence of their
(RPI). Members who joined from October 2002 may opt for either (g) The British Council operates a number of insured schemes Actuarial losses/(gains) 3,076 (3,255)
total membership of the pension scheme, not just their service
the appropriate defined benefit arrangement or a ‘money for overseas appointed staff. None of these schemes is of a
in a senior capacity to which disclosure applies. Benefits paid and death in service
purchase’ stakeholder pension with an employer contribution significant size.
insurance premiums (1,084) (160)
(partnership pension account). The figures include the value of any pension benefit in another
(h) The British Council operates a defined benefit scheme for
scheme or arrangement which the member has transferred scheme liabilities at end of period 14,014 11,213
(i) ClAssIC, preMIuM, ClAssIC plus AnD nuVos sCHeMes UK-appointed employees formerly employed by the Central Bureau
to the Civil Service pension arrangements. They also include any
Employee contributions are set at the rate of 1.5 per cent for Educational Visits and Exchanges. UK Financial Reporting
additional pension benefit accrued to the member as a result
of pensionable earnings for classic and 3.5 per cent for premium, Standard 17 Retirement Benefits has been adopted.
of their buying additional pension benefits at their own cost. CETVs
classic plus and nuvos. Benefits in classic accrue at the rate
are worked out within the guidelines and framework prescribed by The scheme is closed to new entrants. As a consequence the reconciliation of opening and closing balances
of 1/80th of final pensionable earnings for each year of service.
the Institute and Faculty of Actuaries and do not take account of current service cost calculated under the projected unit method of the fair value of the scheme assets
In addition, a lump sum equivalent to three years’ initial pension
any actual or potential reduction to benefits resulting from Lifetime can be expected to increase over time, as the average age
is payable on retirement. For premium, benefits accrue at the rate
Allowance Tax which may be due when pension benefits are taken. of the membership increases. A preliminary actuarial valuation 2010 2009
of 1/60th of final pensionable earnings for each year of service.
was carried out at 1 April 2008 and updated to 31 March 2010 £’000 £’000
Unlike classic, there is no automatic lump sum. Classic plus reAl InCreAse In CetV
by a qualified actuary, independent of the scheme’s sponsoring
is essentially a hybrid with benefits for service before 1 October This reflects the increase in CETV that is funded by the employer. Fair value of scheme assets at start 16,032 18,109
employer. The major assumptions used by the actuary are
2002 calculated broadly as per classic and benefits for service It does not include the increase in accrued pension due to inflation, of period
shown below.
from October 2002 worked out as in premium. In nuvos members contributions paid by the employee (including the value of any
Expected return on scheme assets 789 854
build up a pension based on pensionable earnings during their benefits transferred from another pension scheme or arrangement) The British Council currently pays contributions at the rate of 35.4
period of scheme membership. At the end of the scheme year and uses common market valuation factors for the start and end per cent of pensionable pay. Member contributions are payable Actuarial gains/(losses) 278 (3,326)
(31 March) the member’s earned pension account is credited with of the period. in addition at the rate of five per cent of pensionable pay. Contributions by the British Council 182 528
2.3 per cent of their pensionable earnings in that scheme year Contributions by scheme participants 20 27
The Principal Civil Service Pension Scheme (PCSPS) is an unfunded
and the accrued pension is uprated in line with RPI. In all cases present values of scheme liabilities, fair value
multi-employer defined benefit scheme but the British Council Benefits paid and death in service
members may opt to give up (commute) pension for lump sum of assets and surplus/(deficit)
is unable to identify its share of the underlying assets and liabilities. insurance premiums (1,084) (160)
up to the limits set by the Finance Act 2004.
The scheme actuary valued the scheme as at 31 March 2007.
2010 2009 2008 fair value of scheme assets
(ii) pArtnersHIp pensIon ACCount Details can be found in the resource accounts of the Cabinet Office:
Civil Superannuation (www.civilservice-pensions.gov.uk). £’000 £’000 £’000 at end of period 16,217 16,032
The partnership pension account is a stakeholder pension
arrangement. The employer makes a basic contribution of between Fair value of
For 2009–10, employer’s contributions of £9,333,875 were payable
three per cent and 12.5 per cent (depending on the age of the scheme assets 16,217 16,032 18,109 The actual return on the scheme assets over the period ending
to the PCSPS (2008–09: £8,313,339) at one of four rates in the
member) into a stakeholder pension product chosen by the Present value of 31 March 2010 was £1,067,000.
range of 16.7 per cent to 24.3 per cent of pensionable pay, based
employee from a panel of three providers. The employee does scheme liabilities 14,014 11,213 13,747
on salary bands. The Scheme Actuary reviews employer
not have to contribute but where the employee does make
contributions usually every four years following a full scheme Surplus/(deficit) in scheme 2,203 4,819 4,362
contributions, the employer will match these up to a limit of three total expense recognised in the statement
valuation. From 2010–11, the rates will be in the range of 16.7 per
per cent of pensionable salary (in addition to the employer’s basic Unrecognised surplus 995 3,541 3,052 of financial Activities
cent to 24.3 per cent. The contribution rates are set to meet
contribution). Employers also contribute a further 0.8 per cent Asset/(liability)
the cost of the benefits accruing during 2009–10 to be paid when
of pensionable salary to cover the cost of centrally-provided risk to be recognised 1,208 1,278 1,310 2010 2009
the member retires, and not the benefits paid during this period
benefit cover (death in service and ill-health retirement). £’000 £’000
to existing pensioners. Deferred tax – – –
The accrued pension quoted, is the pension the member is entitled Current service cost 133 126
Employees can opt to open a partnership pension account, net asset/(liability) to be
to receive when they reach pension age, or immediately on ceasing
a stakeholder pension with an employer contribution. Employers’ recognised – – – Interest cost 656 728
to be an active member of the scheme if they are already at or over
contributions of £69,119 were paid to one or more of a panel
pension age. Pension age is 60 for members of classic, premium Expected return on scheme assets (789) (854)
of three appointed stakeholder pension providers. Employer
and classic plus and 65 for members of nuvos. total expense recognised in the
contributions are age-related and range from three per cent to
Further details about the Civil Service pension arrangements can 12.5 per cent of pensionable pay. The employer also matches statement of financial Activities – –
be found at the website www.civilservice-pensions.gov.uk. employee contributions up to three per cent of pensionable pay.
In addition, employer contributions of £5,797, which is 0.8 per cent
72 73
statement of total recognised gains and losses Assumptions Amounts for the current and previous four years

2010 2009 % per annum 2010 2009 2008 2007 2006


£’000 £’000 2010 2009 2008 £’000 £’000 £’000 £’000 £’000
Difference between expected and Inflation 2.75 2.75 2.75 Fair value of scheme assets 16,217 16,032 18,109 17,045 10,849
actual return on scheme assets: Salary increases 4.75 4.75 4.00 Present value of scheme liabilities 14,014 11,213 13,747 14,765 14,957
Amount: gain/(loss) 278 (3,326)
Rate of discount 4.60 6.04 5.32 Surplus/(deficit) in scheme 2,203 4,819 4,362 2,280 (4,108)
Experience gains and losses arising
on the scheme liabilities: Allowance for revaluation Experience adjustment on scheme assets 278 (3,326) 1,036 2,084 (426)
Amount: gain/(loss) 116 1,764 of deferred pensions of
Experience adjustment on scheme liabilities 116 1,764 515 1,022 (3,153)
RPI or 5% p.a. if less 2.75 2.75 2.75
Effects of changes in the demographic
and financial assumptions Allowance for
underlying the present value commutation of pension The best estimate of contributions to be paid by the British Council
of the scheme liabilities: for cash at retirement None None None to the scheme for the period beginning after 31 March 2010
Amount: gain/(loss) (3,192) 1,491 is £141,621.

total actuarial gains and losses


(i) trustees
(before restriction due to some of the mortality assumptions adopted at 31 March 2010 Capita ATL Pension Trustees Limited, independent Trustee to the
the surplus not being recognisable): imply the following life expectancies: Scheme, was paid fees amounting to £17,153 excluding VAT during
Amount: gain/(loss) (2,798) (71)
Male retiring at age 60 in 2010 28.8 the year. No other Trustees of the Scheme either received or
Effect of limit on amount of surplus waived any emoluments during the year. No travel expenses were
recognised due to some of the surplus Female retiring at age 60 in 2010 31.4
reimbursed to Trustees during the year (2008–09: travel expenses
not being recognisable: Male retiring at age 60 in 2030 31.1 amounting to £247 were reimbursed to one Trustee).
Amount: gain/(loss) 2,546 (489)
Female retiring at age 60 in 2030 33.5
total amount recognised in
statement of total recognised
gains and losses:
Amount: gain/(loss) (252) (560) expected long-term rates of return
The long-term expected rate of return on cash is determined
by reference to bank base rates at the balance sheet dates. The
The cumulative amount of actuarial gains and losses recognised long-term expected return on bonds is determined by reference
in the statement of total recognised gains and losses since to UK long-dated government and corporate bond yields at the
adoption of UK Financial Reporting Standard 17 is £1,705,000. balance sheet dates. The long-term expected rate of return on
equities is based on the rate of return on bonds with an allowance
for out-performance.
Assets
The expected long-term rates of return applicable for each period
2010 2009 2008 are as follows:

£’000 £’000 £’000


Equity 6,130 8,513 9,616 % per annum

Bonds 6,892 3,527 3,984 2010 2009

Property 2,903 2,950 3,332 Equity 7.79 7.57

Cash 292 1,042 1,177 Bonds 6.04 5.32

total assets 16,217 16,032 18,109 Property 7.79 7.57


Cash 0.50 5.00

None of the fair values of the assets shown above include any Overall for scheme 6.93 6.91
of the British Council’s own financial instruments or any property
occupied by, or other assets used by, the British Council.

74 75
8 Grants payable Tel Aviv University – 94 – – 94
Coventry University 91 – – – 91
(a) The British Council gives financial support to particular programmes and activities in the form of grants to institutions and individuals.
Turkish Radio Television – 88 – – 88
2009–10
Newcastle University 87 – – – 87
£’000
Sheffield Hallam University 84 2 – – 86
Grants to institutions (2008–09: £11.37 million) 17,791
University of Brighton 86 – – – 86
Grants to individuals (2008-09: £1.93 million) 2,066
University of Essex 84 1 – – 85
total 19,857
Northumbria University 83 1 – – 84
Highbury College 83 – – – 83
Bournemouth University 83 – – – 83
(b) Analysis of grant recipients by objects and value University of Leeds 75 7 – – 82

Institution encouraging encouraging building capacity Developing a total Middlesex University 80 2 – – 82


educational cultural, for social change wider knowledge Tipping Point – 78 – – 78
co-operation and scientific and of the english Open Society Foundation – – 75 – 75
promoting the technological language
advancement of co-operation Cardiff University 43 31 – – 74
education University of Bradford 72 – – – 72
£’000 £’000 £’000 £’000 £’000 Institute for Strategic Dialogue – – 71 – 71
Voluntary Services Overseas – – 798 – 798 London College of Fashion 69 – – – 69
City University 260 – – – 260 Brunel University 67 2 – – 69
Lisson Gallery, London – 250 – – 250 University College London 48 17 – – 65
University of Birmingham 232 1 – – 233 University of Liverpool 61 3 – – 64
University of Manchester 161 38 – – 199 University of Sheffield 59 3 – – 62
Leeds Metropolitan University 199 – – – 199 University of Glasgow 56 4 – – 60
University of Greenwich 198 – – – 198 Dundee College 58 – – – 58
The Open University 181 15 2 – 198 Nargis Action Group – – 57 – 57
University of Cambridge 173 20 – – 193 Derby College 57 – – – 57
University of Reading 158 3 – – 161 University of Warwick 47 10 – – 57
King’s College London 150 1 – – 151 Loughborough University 55 1 – – 56
Complicite, London – 150 – – 150 Heriot-Watt University 46 9 – – 55
University of East Anglia 99 49 – – 148 City College Birmingham 55 – – – 55
Imperial College London 128 11 – – 139 VGBIL Library – – 53 – 53
University of Nottingham 124 10 – – 134 University of Northampton 52 – – – 52
Bradford College 124 – – – 124 University of Hertfordshire 52 – – – 52
University of Leicester 113 9 – – 122 Echo Culture Limited – 51 – – 51
University of Southampton 94 22 – – 116 University of Exeter 41 7 – – 48
University of Durham 108 2 – – 110 University of Central Lancashire 47 – – – 47
University of Teesside 106 – – – 106 Kingston University 42 4 – – 46
University of Edinburgh 91 12 – – 103 Oxford Brookes University 42 2 – – 44
ISCOS – – 102 – 102 Grants to other institutions 7,994 2,401 364 60 10,819
University of Oxford 60 42 – – 102 total grants to institutions 12,750 3,459 1,522 60 17,791
University of Ulster 92 6 – – 98 Grants to individuals (2,247 recipients) 593 1,267 166 40 2,066
total grants 13,343 4,726 1,688 100 19,857
76
9 Cost of capital 11 tangible fixed assets
Notional cost of capital is calculated as 3.5 per cent of the average
freehold leasehold furniture Information Vehicles Art total
capital employed in the year.
land and land and and technology and plant collection
property property equipment
£’000 £‘000 £’000 £’000 £’000 £’000 £’000
10 Intangible fixed assets
Modified cost or valuation
software licences At 1 April 2009 98,621 89,341 10,811 23,084 9,807 3,836 235,500
£’000 Additions 5,104 4,453 587 1,051 626 66 11,887
Modified cost or valuation Transfers – – – – – – –
At 1 April 2009 6,433 Disposals (596) (12,254) (2,201) (7,748) (890) – (23,689)
Additions/transfers 700 Revaluations (CCA) – – 803 334 919 – 2,056
Disposals – Revaluations – – – – – – –
At 31 March 2010 7,133 At 31 March 2010 103,129 81,540 10,000 16,721 10,462 3,902 225,754

Amortisation Depreciation
At 1 April 2009 (1,790) At 1 April 2009 (1,802) (25,082) (9,391) (15,293) (7,817) – (59,385)
Charge for year (817) Charge for the year (2,068) (3,169) (459) (3,260) (836) – (9,792)
Disposals/transfers – Disposals/transfers 100 8,760 2,189 7,744 836 – 19,629
At 31 March 2010 (2,607) Backlog depreciation (CCA) – – 257 (2,340) (60) – (2,143)
Revaluations – – – – – – –
net book value
At 31 March 2010 (3,770) (19,491) (7,404) (13,149) (7,877) – (51,691)
At 31 March 2010 4,526
At 1 April 2009 4,643 net book value
At 31 March 2010 99,359 62,049 2,596 3,572 2,585 3,902 174,063
At 1 April 2009 96,819 64,259 1,420 7,791 1,990 3,836 176,115

Included in the above:


Assets in progress (AIp)

land and furniture Information Vehicles Art total


property and technology and plant collection
equipment
£’000 £’000 £’000 £’000 £’000 £’000
AIP at 1 April 2009 6,416 146 184 125 – 6,871
AIP items capitalised in 2009–10 (4,687) (150) (156) (124) – (5,117)
2009–10 AIP items to be capitalised 2,354 84 295 268 – 3,001
total AIp at 31 March 2010 4,083 80 323 269 – 4,755

78 79
Included in tangible fixed assets are assets to the value of 12 fixed asset investments (a) subsidiary undertakings
£19.5 million which have been fully depreciated. These assets
The group fixed asset investment of £231,113 is comprised
are still in use and provide value to the business. The British organisation name Country of registration nature of business ownership Class of shares
of investment in a non-consolidated subsidiary of £5,750 and
Council considers that the useful lives of its tangible fixed assets and % held
investment in a joint venture of £225,363.
remain appropriate.
BC Trading International Limited England and Wales Raise funds through The British Council is the Ordinary/100%
Arising from the British Council’s Status and Tax programme,
All tangible fixed assets acquired are used to support the trading activities sole shareholder
which aims to establish a robust platform for the growth
British Council’s charitable activities. BC English Services Hong Kong Holding company The British Council is the Ordinary/100%
of income-generating activities in line with strategic priorities,
Freehold and long-leasehold land and buildings are revalued every the British Council has further developed its group structure. Trans-National Limited sole shareholder
five years. Freehold and long-leasehold land and buildings were BC Holdings (United Kingdom) England and Wales Holding company The British Council is the Ordinary/100%
As at 31 March 2010, there were four subsidiary undertakings within
valued on the basis of open market value for existing use at Limited sole shareholder
the group; BC Trading International Limited, BC English Services
31 March 2009 by DTZ Real Estate Advisers, in accordance with
Trans-National Limited, BC Holdings (United Kingdom) Limited and BCT Events and Promotions India Raise funds through BC Trading International Ordinary/100%
the guidelines issued by the Royal Institution of Chartered
BCT Events and Promotions India Private Limited. The British India Private Limited trading activities Limited and the British
Surveyors. The British Council has concluded that there was no
Council also incorporated a further subsidiary, BC Management Council are the
significant movement in the value of its properties during the year.
Services Private Limited, on 12 May 2010. shareholders
Included within the freehold and leasehold property categories
BC Trading International Limited was incorporated on 5 April
are land and buildings for dwelling purposes valued at a cost
2004 as a wholly owned subsidiary of the British Council and
of £13.5 million and net book value of £13.1 million (2009: cost
is a company limited by shares. It carries out general commercial (b) Investment in subsidiaries
£14.1 million and net book value £13.9 million).
activities predominantly generating sponsorship income through
The adjustments for current cost accounting revaluation and British Council events. The main profit from such activities is paid bC trading bC english services bC Holdings (united bCt events and
backlog depreciation include the effect of both upward and by gift aid to the British Council. International limited trans-national Kingdom) limited promotions India
downward indices. The net result has been added to the revaluation limited private limited
BCT Events and Promotions India Private Limited is a wholly owned
account because the downward movements are considered to £ £ £ £
company incorporated in India which was acquired in July 2009
be of a temporary nature.
by the group. There were no trading activities during the year Investment at 1 April 2009 100 – – –
Within the freehold land and properties category, there is one to 31 March 2010 and the company is exempt from consolidation
Additions – 85 1 5,750
building allocated a useful life of 60 years in 2009 that will expire in the British Council group accounts under Charities SORP,
in 2069. The current book value in 2009–10 was £2.1 million. section 383(c). Investment at 31 March 2010 100 85 1 5,750

The British Council maintains a permanent collection of works BC English Services Trans-National Limited and BC Holdings
of art which started in 1938 and at present has over 8,000 works. (United Kingdom) Limited were incorporated during the financial
The current estimated value as valued by the Curator of the year to enable the British Council to carry out its charitable (c) financial summary of bC trading International limited (d) During the financial year the British Council made a registered
collection is £78 million (2009: £61 million). The purpose of the objectives in a more efficient and effective manner. As at the year capital investment in the form of a loan of £2.3 million to BC English
collection is to increase the understanding and appreciation of end neither of these companies had commenced trading. 2010 Services Trans-National Limited. This loan remained payable by
British art overseas in furtherance of the British Council’s objectives £’000 BC English Services Trans-National Limited as at 31 March 2010.
BC Management Services Private Limited was incorporated in India
for cultural co-operation. It is not held for investment or resale.
on 12 May 2010 with an authorised share capital of 50,000 shares Assets including current assets 466
Many works have been acquired from emerging artists and
of 10 rupees each. 10,000 shares have been issued; 9,900 of the
on beneficial terms because of the collection’s purpose. For the Current liabilities (454)
issued shares are held by the British Council and 100 are held by
above reasons, the collection is included in the accounts at cost Reserves 12
BC Holdings (United Kingdom) Limited. BC Management Services
or nil value in the case of donated items. The art collection is not
Private Limited was set up to provide services to the British Council 2009–10
depreciated since the assets are considered to have an indefinite
to support its charitable objectives.
life and the residual values of the assets are considered to be £’000
either in line or above costs. The British Council has a long-term interest in a joint venture, IELTS Revenue 1,044
Inc., over which it exercises joint control. IELTS Inc. is a not for profit
The British Council valued its fixed assets in 1994 when changing Operational expenses and gift aid (1,044)
organisation formed for the charitable and educational purposes
from cash to resource accounting principles. It is not practical Profit/(loss) –
of supporting and improving the teaching of English.
to identify the original cost and accumulated depreciation of those
assets included at valuation at that date.

80 81
(e) Joint venture (b) Intra-government debtors
organisation name Country of registration nature of business Interest held Group
IELTS Inc. Delaware, USA Developing, administering and 33.3% 2009–10 2008–09
marketing the IELTS
examinations £’000 £’000
Balances with central government bodies 8,480 19,017
Balances with local authorities 55 9

InVestMent In Ielts InC. Balances with public corporations and trading funds 1 5
Total intra-government debtors 8,536 19,031
2010
Balances with bodies external to government 102,917 96,978
£’000
total 111,453 116,009
At 1 April 2009 234
Programme-related investment
Interest receivable 5
Loss on revaluation (14) 14 Derivative financial assets forward contracts
At 31 March 2010 225 The British Council uses forward foreign exchange contracts 2009–10 2008–09
to reduce exposure to movements in exchange rates. At 31 March
£’000 £’000
2010 the British Council held 12 open forward foreign exchange
The results of the joint venture are not material and as a result have contracts, under which the British Council will receive a total of Forward foreign exchange
not been consolidated. US$17 million in exchange for £10.6 million. The contracts all have contracts – fair value 663 –
maturity dates falling due in less than one year. These contracts
are carried at fair value on the balance sheet. The fair value of the
forward foreign exchange contracts reflects the difference between
13 Debtors (amounts falling due within one year) the contracted forward rate and the market forward rate at
31 March 2010 for delivery on the contracted maturity date.
(a) Analysis by type The market forward rate used to determine the fair value is the
Group british Council mid-market rate for 31 March 2010, obtained from Reuters.

2009–10 2008–09 2009–10 2008–09


£’000 £’000 £’000 £’000
Trade debtors 48,334 59,275 48,334 59,275
15 Creditors (amounts falling due within one year)
VAT debtor 288 468 268 636
Other debtors 10,252 4,876 10,073 4,531 (a) Analysis by type

Balances resulting from activity under contracts and agreements 36,669 39,357 36,669 39,357 Group british Council

Prepayments 15,910 12,033 15,910 12,033 2009–10 2008– 09 2009–10 2008–09

Amounts due from subsidiary undertakings – – 444 1,349 £’000 £’000 £’000 £’000

total 111,453 116,009 111,698 117,181 Trade creditors 20,156 16,110 20,156 16,110
Balances resulting from activity under contracts and agreements 70,777 77,267 70,777 77,267
Other creditors 6,327 7,438 6,317 7,411
Accounting treatment adjustments related to specific projects Taxation and social security 2,546 1,666 2,546 1,666
within activities under contracts and agreements have resulted Accruals 39,365 37,487 39,365 37,487
in an overall decrease in creditor balances of £7.3 million and
Deferred income 78,020 66,914 78,020 66,914
decrease in debtor balances of £5.2 million.
total 217,191 206,882 217,181 206,855

Accounting treatment adjustments related to specific projects


within activities under contracts and agreements have resulted
in an overall decrease in creditor balances of £7.3 million and
82 83
decrease in debtor balances of £5.2 million.
(b) Intra-government creditors 17 Movements on funds and reserves
Group General retirement Capital revaluation total
2009–10 2008 –09 account benefits account account
scheme
£’000 £’000
reserve
Balances with central government bodies 3,374 360
£’000 £’000 £’000 £’000 £’000
Balances with local authorities 26 85
Balance as at 1 April 2009 45,820 4,819 104,990 75,768 231,397
Balances with NHS trusts – 2
Net outgoing resources for the year after
Balances with public corporations and trading funds 307 – reversal of notional costs (1,521) – – – (1,521)
Total intra-government creditors 3,707 447 Nominal transfer to capital and valuation account 1,891 – (1,784) (107) –
Balances with bodies external to government 213,484 206,435 Transfer of net pension costs (182) 182 – – –
total 217,191 206,882 Actuarial loss recognised in the retirement
benefits scheme – (2,798) – – (2,798)
Valuation account movement: on general fixed
16 provisions for liabilities and charges assets – – – (278) (278)
balance as at 31 March 2010 46,008 2,203 103,206 75,383 226,800
(a) Amounts falling due within one year
terminal early other staff legal cases other total costs
gratuities retirement
£’000 £’000 £’000 £’000 £’000 £’000 18 Commitments
At 1 April 2009 – 851 203 875 314 2,243 (a) Capital commitments
Unrealised gain on 2010 2009
exchange – – – – – –
£’000 £’000
Net amounts paid or
Contracted expenditure 4,530 5,445
utilised in year – (1,016) (71) (781) (311) (2,179)
Charged to
expenditure – 19,585 162 14 4,128 23,889
Movement between (b) specific charitable projects (grants)
short and long term – 350 – 38 – 388
2010 2009
At 31 March 2010 – 19,770 294 146 4,131 24,341
£’000 £’000
To be undertaken in the following year 12 11

(b) Amounts falling due after more than one year


(c) Annual commitments under operating leases
terminal early other staff legal cases other total costs Commitments under operating leases to pay rentals during future
gratuities retirement years are analysed according to the period in which each lease
expires. These all relate to land and buildings.
£’000 £’000 £’000 £’000 £’000 £’000
At 1 April 2009 14,770 1,331 – 80 305 16,486
2010 2009
Unrealised gain on
exchange (566) – – – – (566) £’000 £’000

Net amounts paid or In one year or less 7,172 6,702


utilised in year (1,838) (354) – (42) (305) (2,539) Between one and five years 7,842 11,949
Charged to In five years or more 5,148 3,958
expenditure 3,798 4,157 – – – 7,955
total 20,162 22,609
Movement between
short and long term – (350) – (38) – (388)
At 31 March 2010 16,164 4,784 – – – 20,948
85
19 losses and special payments provided approval for the Business Transformation related
organisation Grants provided and funds trustee relationship
payments and for two of the three compromise agreements
During the year there were 214 cases where a loss, as defined disbursed under contracts/
on the basis that they offered value for money.
in Managing Public Money, was recognised totalling £202,460. agreements
This includes fraud and non-fraudulent business write-offs. The third compromise agreement had a total value of £108,559, £’000
No individual case was greater than £250,000. consisting of a contractual payment in lieu of notice of £50,235
Glasgow Caledonian University 225 Pamela Gillies Principal and Vice-Chancellor
and an ex-gratia element of £58,324. The payment in lieu of notice
During the year the British Council made payments totalling
was in line with the terms of the individual’s contract and so did Clore Leadership Programme 54 Sue Hoyle Director and Trustee
£573,755, of which £504,214 falls within the category of special
not require approval from HM Treasury. However, the ex-gratia Lord Hall of Birkenhead CBE Member of Strategic Advisory
payments as defined in Managing Public Money.
payment of £58,324 required specific HM Treasury approval. Committee
These special payments consist of: Whilst acknowledging that it represented from the British Council’s Queen’s University Belfast 810 Brian Hanna CBE Former member of the Senate
perspective an appropriate management decision, HM Treasury
n £360,048 in relation to non-statutory and non-contractual King’s College London 942 Sue Hoyle Research associate
has declined to provide retrospective approval for this ex-gratia
voluntary early retirement/redundancy payments to staff
payment, having concluded that the British Council ought to have Tipping Point 78 Sue Hoyle Husband is a Board member
as part of the British Council’s Business Transformation
pursued other avenues with the individual concerned. The Open University 388 Claire Ighodaro CBE Council member and Audit
programme, a component of which is a reduction of 500 UK
posts predominantly in Finance, Information Services and Committee Chair
Contracts and Projects delivery. A voluntary early retirement/ 20 related party transactions University College London 1,576 Steve Jones Professor
redundancy programme was run in 2009. There was a small
The British Council is a non-departmental public body sponsored
number of staff who were employed in the UK but had British
by the Foreign and Commonwealth Office (FCO).
Council service outside of the Principal Civil Service Pension
Scheme (PCSPS) who would have been eligible for either The FCO is regarded as a related party. During the year the In addition to the grants totalling £54,000 provided to the 21 Contingent liabilities
British Council has had various material transactions with the FCO. Clore Leadership Programme, as set out in the table above, the The British Council announced a voluntary early retirement
no compensation or a smaller statutory redundancy payment
British Council also paid a fee of £19,947 to the Clore Leadership (VER) programme to staff on 10 June 2009 in order to achieve
for that period of service. After consultation with the Public
The British Council has had a number of material transactions Programme to run a short residential course as part of the British
and Commercial Services Union, the Foreign and Commonwealth UK post reductions to support its Scale of Ambition programme.
with other government departments and other central government Council’s Cultural Leadership International programme.
Office (FCO) and the Cabinet Office, the British Council agreed The announcement stated that it was hoped that the voluntary
bodies. The most significant have been with:
that additional payments should be offered to these staff in Alan Buckle is a Trustee of the British Council, and for part of the programme would mean that compulsory redundancy could
order to maximise volunteers, ensure fair treatment of staff and n the Department for International Development 2009–10 financial year, he acted as Chair of the Audit Committee. be avoided, but that it could not be ruled out. As at 31 March 2010,
to avoid compulsory redundancy where possible. Payments He is also a member of the Remuneration Committee and the following the VER programme and main phases of deployment,
n the Department for Business, Innovation and Skills
to these staff were substantially below voluntary early retirement/ Nominations Committee. Alan Buckle is global head of KPMG there remains a small number of staff not yet deployed into roles.
redundancy terms offered to staff within the PCSPS. n the Department for Children, Schools and Families. Advisory. KPMG is a provider of professional services to the British During June 2010, relevant staff were notified that they are at risk
Council. During the financial year KPMG provided tax advisory, of redundancy but that the British Council will continue to try
n Three separate compromise agreements for individuals totalling In addition, the British Council has a number of transactions
consultancy and internal audit services to the British Council, to identify measures in which redundancy can be avoided and that
£213,707, of which £144,166 were non-contractual ex-gratia with the British Council Benevolent Fund which provides financial
for which the British Council incurred costs of £455,364. Of this any formal notification of redundancy would follow consultation
payments and therefore defined as special payments. assistance to staff in need in the UK and overseas via charitable
amount £32,893 relates to the cost of internal audit services with the Trade Union. While every effort continues to place these
These individuals were considered to be at risk of redundancy donations from current and ex-employees. The British Council has
provided by KPMG under an internal audit services agreement. staff and avoid compulsory redundancy, it cannot yet be ruled
as they were from specialist areas of the business affected by no control over the fund; however, the Trustees of the fund are
Alan Buckle played no part in the procurement of the internal out. As such a contingent liability exists for redundancy costs
restructuring for whom no future alternative roles were available. appointed by the British Council Board of Trustees.
audit services agreement or any other service from KPMG. associated with these staff, but this cannot be quantified at the
One of the three compromise agreements included
None of the Trustees, Board members, key managerial staff or balance sheet date.
consideration of an employment tribunal claim.
other related parties has undertaken any material transactions with
The British Council had relied upon its Financial Memorandum the British Council during the year other than as disclosed below.
with the FCO and had not understood that it required formal
advance approval from HM Treasury for these payments
but subsequently sought retrospective approval. HM Treasury

© british Council 2010


Design Department/Z005
Designed and written by the British Council

86 the united Kingdom’s international organisation for cultural relations and educational opportunities. 87
A registered charity: 209131 (England and Wales) SC037733 (Scotland).
GlobAl netWorK
Details were correct as at 31 March 2010.

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