The BBC licence fee will rise by £10.50 to £169.50 a year, Culture Secretary Lucy Frazer has announced, along with a review into alternative funding models.
The fee, which funds much of the corporation’s operations, had been frozen at £159 in 2022 for two years to “protect families from the sharp rise in the cost of living,” the government said.
Speaking in the Commons on Thursday, Ms. Frazer said the increase will instead be based on September’s consumer prices index rate of inflation, which was 6.7 percent.
This will mean an increase of £10.50 to £169.50 per year.
Ms. Frazer said: “We know family budgets are stretched, which is why we have stepped in again—following two years of licence fee freezes—to reduce this year’s increase to less than a £1 a month.”
Ms. Frazer also announced a review into the licence fee model, but said that the government is committed for the fee to remain until the current charter period ends in December 2027.
She said that the review will include looking at “how the BBC can increase its commercial revenues to reduce the burden on licence fee-payers.”
“Given pressure on household incomes, I can explicitly rule out that this review will look at creating any new taxes,” she said.
The TaxPayers’ Alliance told The Epoch Times that their calculation on the licence fee increase would mean “the BBC taking £365,596,950 more in licence fee payments, based on the March 2023 figure of the number of TV licences.”
The lobby group argues that the licence fee means that TV viewers who do not care for or who object to BBC output are compelled to fund the BBC to gain permission to watch non-BBC material.
Alternative Funding Model
Ms. Frazer said the BBC licence fee could be replaced by an alternative funding model, depending on the review and public consultation.“With an increasingly competitive media landscape, we need to make sure that the cost of the BBC does not rise exponentially nor that it is borne by a smaller number of fee payers,” she said.
“We’re already seeing an increasing number of households choosing not to hold a TV licence. The number of households holding TV licences fell by 400,000 last year and has declined by about 1.7 million since 2017–18. This is placing increasing pressure on the BBC’s licence fee income.”
“We are also seeing a rapidly changing media landscape, with more ways for audiences to watch content. Reach and viewing of broadcast TV fell significantly in 2022 with reach falling from 83 percent in 2021 to 79 percent in 2022.”
She said that as this trend continues, linking the “TV licence to watching live TV will be increasingly anachronistic as audience viewing habits continue to move to digital and on-demand media.”
Significant Impact
In response, on Thursday the BBC said that “this outcome will still require further changes on top of the major savings that we are already delivering.”“Our content budgets are now impacted, which in turn will have a significant impact on the wider creative sector across the UK. We will confirm the consequences of this as we work through our budgets in the coming months,” it said.
