LONDON: BBC director general Mark Thomson (pictured), has been told by the ruling BBC Trust when, where and how he must make the required three per cent cuts to the corporation's annual £3 billion ($5.99bn; €4.3bn) budget.

The twelve-strong board of trustees, chaired by former academic and civil servant Sir Michael Lyons, ruled out the 'quick fix' solution advocated by a number of high profile BBC insiders: the axing of an entire niche channel, either the youth-oriented BBC3 or the 'highbrow' BBC4.

Instead, the 3% annual saving must be achieved by a 'Ling Chi' approach - or death by a thousand cuts as it was known outside its Chinese homeland.

A budget for the next five financial years (2008-9 through 2012-13) will be finalised next month. The trustees say this must focus on delivering less programming, but of the highest quality - and in areas of greatest viewer interest.

Among the latter programmes are news and current affairs, educational and drama - although according to a "senior source": "That is not to say that efficiencies cannot be made in any of those areas."

Onlookers nominate the BBC's annual taxi bill (£13m in 2006-07), and talk-show host Jonathan Ross (£6m yearly) as candidates for the first two slashes.

Data sourced from Financial Times; additional content by WARC staff