The BBC Trust has criticised the management and financial control of its online services after discovering that last year the web site exceeded the agreed budget by nearly 50%, spending over £110 million. So it has agreed to increase the budget for next year to £114 million.

A review by the BBC Trust found that the BBC web site is highly valued by its users and appears to provide good value for money. It accounts for only 3% of total BBC spending. Despite growing competition, it remains the most visited site in the country for news and sport and is among the most widely used for education and local information.

However, the review also said that more needs to be done to ensure the service is distinctive and improvements are needed in internal search and navigation.

“Management control of is not sufficiently strong at present,” it concluded, having discovered that it had exceeded its budget by nearly £36 million, a substantial proportion of which it attributed to “misallocation of general overheads and costs from other budgets”.

While this might simply be a matter of internal accounting, it represents “a serious breach of the Service Licence”.

“The devolved nature of the BBC’s management of online activities has also made it difficult to discern the service’s overall strategic direction,” noted the Trust, adding that it needed “stronger central editorial control”.

It follows a restructure in which much of the responsibility for online production was devolved to separate production divisions for television and radio, which the BBC now calls Vision and Audio and Music.

The restructuring, observes the Trust, seems to have had an “adverse effect” on accountability resulting in the web site “being treated more as a platform than as a discreet service.” The BBC has always valued discretion.

Management had planned an additional increase of £39 million in the online budget for next year. The Trust says it will not approve the proposed new investment until it is satisfied with the improved management and control of the service.

Nevertheless, it has set a new budget of £114 million, which just happens to be £40 million over the budget for last year.

“For the benefit of those who pay, the Trust wants evidence of stronger management controls to improve financial accountability and strategic and editorial oversight before we consider new investment in the service,” it said in a statement.

The BBC responded to its trustees saying that accepted the conclusions and that it looked forward to discussing its plans in detail with the Trust in the coming weeks.