Mark Thompson and other BBC bosses shared £3.73 million last year, during a period in which audience share declined and the proportion of licence payers’ money spent on programmes fell.

Mr Thompson, the Director General, earned £609,000, 10 per cent ahead of his £562,000 salary last year, while four other top executives received pay increases of between 6 and 15 per cent — well ahead of the 2.6 per cent offered to BBC staff.

Trade union officials warned that they would consider holding a strike ballot, after learning of the above-inflation pay increases, which were published in the Corporation’s annual report yesterday.

Luke Crawley, an official from broadcast union BECTU, said: "I am confident that today’s announcement will reinforce the opinion of union members that industrial action is needed to protect their pay and pension provision."

Last year, the BBC axed over 1,000 staff as it began a three year cost cutting programme. That cost it £106.7 million to implement, while the budgets for BBC One and Two fell, and the proportion of income spent on programming dropped from 90 to 89 per cent.

However, Mr Thompson refused to take a bonus for the second year running. The extra payment could have been worth up to £62,000, but he said that he "didn’t feel it was right putting myself forward for a bonus" when he was implementing a programme that was having "a big impact".

John Smith, the man in charge of the BBC’s commercial activities, got the biggest pay increase. His income was up by 14.7 per cent to £444,000. Jenny Abramsky, controller of radio, earned 6 per cent more at £322,000 while Jana Bennett, director of television, also got a 6 per cent boost at £353,000.

Extra pay was agreed as part of a strategy to ensure that BBC bosses’ basic salaries caught up with the norms in the media industry, after Michael Grade and other Governors determined it had fallen about 15 per cent behind rival broadcasters. But Mr Grade also decided to cut the maximum bonus for BBC executives to 10 per cent of base salary.

Produced by the BBC Governors, the annual report is an opportunity for Michael Grade, the Chairman, to hold executives to account.

But Grade was barely critical, warning only that BBC One had to make "a particular effort in its early evening schedule" and that children’s channels CBBC and CBeebies had acted to "end succesful programmes that reached the end of their natural creative life".

The BBC document was released four days early to accomodate Parliament, which is debating the ten year extension to the BBC Royal Charter on Monday.

At that debate, the BBC will come under pressure from the Conservatives, who, under the leadership of David Cameron have become critical of the scale and scope of the public broadcaster’s activities.

Hugo Swire, shadow culture minister, complained yesterday that "we are debating charter renewal without knowing what the licence fee will be until December. If the BBC does not get what it wants, then which part of the a la carte menu is Government going to say that the BBC won’t have to comply with".

Mark Thompson was also forced into defending the £6 million a year paid to presenter Jonathan Ross, in a recently signed deal. "The BBC has always had to compete for the best broadcasters; our licence fee payers expect the best talent to appear on the BBC," he said.

BBC income leapt by 5.5 per cent in the year to March 31, principally helped by a historic above inflation deal agreed by former culture secretary Chris Smith in the late 1990s.

Cash from the licence fee totalled £3.1 billion, with commercial income and grants for the World Service taking total revenue to £4.2 billion.

However, most of the extra cash went on the redundancy costs, while spending on the BBC’s historic television and radio services fell 1.3 per cent to £1.77 billion.

BBC One spending was cut £32.5 million, largely because 2005/6 did not require the expensive coverage of a major sporting event.

BBC One’s audience was down 6 per cent to 22.9 per cent, while BBC Two dropped 2 per cent to 9.4 per cent. Across all British television and radio, the BBC commanded a 42.7 per cent audience, down from 43.1 per cent, even though the total spending on all programming was up 1.1 per cent at £2.49 billion.

Meanwhile, the less popular digital channels got a major boost, with spending up £53 million to £378 million. The BBC website cost £72.3 million, after receiving a £3 million boost, while BBC Three spent £92.9 million in return for deliving an audience share of 0.6 per cent, while the upmarket BBC Four cost £46.9 million to attract just 0.2 per cent of viewers.

The largest increase was reserved children’s channels CBBC and the under-pressure CBeebies had their budgets lifted £13.5 million to £63 million, as the broadcaster pursued a strategy of shifting children’s spending away from BBC One and BBC Two.