Staff at the BBC World Service are bracing themselves for up to 1,000 job losses, as the broadcaster prepares to lose up to 40 per cent of its budget in next week's Coalition spending review.

Unlike the BBC's domestic services, the World Service is funded not out of the TV licence fee but from a £272million annual grant-in-aid from the Foreign and Commonwealth Office.

Though the World Service is not expected to be abolished completely in next week's announcement from the chancellor, George Osborne, the FCO has asked the BBC for budgets reflecting either a 25 per cent or a 40 per cent cut.

Employees fear that this will translate into the loss of between a quarter and a half the World Service's 2,017 jobs. The World Service broadcasts around the world in 32 languages including Russian, Persian and Hindi.

"It looks as if whole services will close, not just one or two jobs going from here and one or two from there," said a source. "And the potential for redeployment of staff is lower within the World Service than at the rest of the BBC - you can't transfer a Polish speaker to the Urdu service."

It is possible that, as part of the cuts, the BBC Monitoring Unit will close completely and that there will be deep cuts to the Arabic service. Other language services could stop being broadcast by traditional radio and move to being internet-only, reflecting the greater use of computers and mobile phones among the World Service's audience.

However a BBC management source cautioned against prejudging the outcome of the ongoing and complex negotiations, which include the Treasury and No10 as well as the BBC and the FCO.

Peter Horrocks, the director of BBC Global News, which includes the World Service, emailed his staff this week to warn them that restructuring is imminent. "Why are we announcing these changes now, when spending decisions are just a week away?" he said. "Firstly, these changes are needed to get Global News working together more effectively, whatever the settlement for BBC World Service. But the new roles will also help us to deliver the savings that will undoubtedly be required from us.

"Over the next few weeks, [BBC Global News managers] will be working with those directly affected by the proposals. I will then be sharing with you all the final outcome of these discussions and the detail of the final structure with which we will move forward."

A BBC spokesman said: “BBC World Service is engaging with the Foreign & Commonwealth Office as part of the Government’s 2010 spending review, which is due to conclude in mid-October. Like all publicly funded bodies, we have been asked to consider the likely impact of significant funding cuts and applying them to a wide range of scenarios.

"It is important to note that no decisions have been made; and we will discuss any confirmed impact on our services with staff first. We will continue to argue confidently that BBC World Service is one of Britain’s most effective and vital assets in the global arena; particularly at a time when other governments are increasing, not reducing, their own investments in international broadcasting.”

(Source: Telegraph)