Culture Secretary Nadine Dorries today confirmed the BBC licence fee will be frozen at £159 for the next two years as she also announced a review into the long-term future of the annual levy.
Ms Dorries informed MPs that the license fee would remain unchanged until April 2024, when it would rise according to inflation over the next four years up to December 31, 2027.
She said the broadcaster had been pushing for rises in line with inflation every year which would have seen the fee increase to more than £180 by 2027.
But she said the ‘global cost of living is rising’ and the Government did not believe it would be justified to hit families in the pocket in the next two years.
Meanwhile, Ms Dorries announced that it was time for a review of the funding structure of the BBC.
Ms. Dorries indicated previously that she supports the scrapping of the licensing fee after 2027.
She said: ‘It is time to begin asking those really serious questions about the long term funding model of the BBC and whether a mandatory licence fee with criminal penalties for individual households is still appropriate.’
The announcement came after a former BBC chairman warned the £159 licence fee was ‘too much money’ as he suggested BBC2 and BBC4 could be abolished to cut costs.
Lord Grade who also served as CEO and chairman of ITV said that although the sum may not seem large to Gary Lineker but is substantial for all Britons. The annual universal levy was what he described as a’regressive tax.
BBC executives have pledged to “continue to make an even stronger case to the Government for investment” in the corporation.
Today’s message to employees from director general Tim Davie, chairman Richard Sharp stated that they welcome debate and look forward to engaging with a conversation about the UK’s public broadcasting system and funding.
Culture Secretary Nadine Dorries today confirmed the BBC licence fee will be frozen at £159 for the next two years as she also announced a review into the long-term future of the annual levy
In a message sent to employees, chairman Richard Sharp (pictured) said that director general Tim Davie and chairman Richard Sharp ‘welcome’ discussion and “look forward” to participating in a debate about public service broadcasting and the best way to finance it.”
The licence fee currently earns the corporation £3.2 billion a year. Ms Dorries has frozen the levy for a period of two years
Ms Dorries signalled yesterday that the BBC licence fee will be scrapped after 2027 – assuming the Conservative Party is still in power.
Twitter was her first tweet on Sunday morning. These days, the elderly are no longer being threatened by bailiffs or prison sentences.
“Time to talk and discuss new funding options, support and sales of great British content.”
Boris Johnson has proposed that the Government make changes to broadcaster funding arrangements as part of his policy blitz called “Operation Red Meat”, which seeks to rebuild Tory MPs’ support following the Partygate row.
Ms Dorries imposed a two year freeze on Corporation’s licensing fees. She and her colleagues have also warned that the days of state-run television may be over as tensions between Government and BBC are continuing to escalate.
Tense negotiations between the Government and the BBC over the cost of the annual fee until the end of 2027 have concluded, with Ms Dorries deciding to hold the licence at £159 for the next two years.
Officials calculate that – due to inflation currently running at 5.1 per cent – the Corporation will have to find savings of more than £2billion over the next six years.
The tweet by Ms Dorries appeared to confirm that the Conservatives, if still in power in 2027 will attempt to replace the licensing fee. New funding models that reflect the increasing popularity of subscription services, such as Amazon Prime or Netflix.
Lord Grade told BBC Radio 4’s Today programme: ‘£159 a year may not be a lot of money for Gary Lineker but it’s a heck of a lot for many people in this country when there is inflation, an energy crisis and so on. This is too much.
“The BBC, throughout its history, has demanded more money for every licensing fee settlement.
It has made good savings over the years. But it has not given up its land. BBC2 and BBC4 are necessary. I do not understand the concept. I don’t understand the BBC. It is designed to grow and survive.
Lord Grade claimed that Ms. Dorries had set the tone for the debate over what would replace the licensing fee.
He added: “I wouldn’t rule out advertising funding BBC because it would devastate Channel 4 or Channel 5 and other channels. While subscription is possible, what about radio? Except for very specific services, there is no other place in the world that this works.
“You could grant aid. Somebody suggested taxing big streaming monoliths.
“Time will soon run out and it is imperative that we have this debate now if there are going to be any transitions from the licensing fee.
Ms. Dorries posted yesterday morning that this license fee announcement would be the final.
Lord Grade, also the CEO of Channel 4 (and chair of ITV), stated that although it may not have been a large amount for Gary Lineker but it was for all Britons.
“What should the BBC do? What budget can we afford to pay?” The options are endless and the Secretary of state was trying to make that clear.
Ms Dorries’ announcement comes after a series of rows between the BBC and ministers over the Corporation’s alleged Left-wing bias.
High ranking Government figures expressed frustration last week at its reporting of Johnson’s apology before MPs for Downing Street’s row.
The licence fee currently earns the corporation £3.2billion a year.
BBC executives had called on the inflation rate to rise as it did in past years. Ministers heard from them that it was unfair to confuse bias perceptions with funding arrangements.
The BBC will lose its ability to make hit programs like Line of Duty or David Attenborough’s Nature Series if the license fee is frozen.
Richard Sharp, BBC chairman, stated last year that the costs of BBC’s most popular shows have doubled while drama prices alone rose by about 35%.
In an environment where households face an extreme cost of living squeeze from tax increases and rising energy prices, the Government believes that inflation-linked growth is not possible.
The MP for Mid Bedfordshire, an ally to Ms Dorries and best-selling author who appeared on ITV’s I’m A Celebrity , told The Mail that there will be many anxious noises regarding how the programme will impact popular programs, but they can also learn to reduce waste like other businesses.
“This is the final negotiation for a BBC licence fee. Next week will see the start of work on a midterm review that would replace the Charter by a new funding model.
The BBC knows it’s done.
The BBC’s Mr Sharp and Mr Davie reaffirmed to employees today that the fee for licence is fixed until 2027. However, they said it was up to the public to discuss and decide what will happen after this date.
Boris Johnson has proposed that the Government make changes to broadcaster funding arrangements as part of his policy blitz called “Operation Red Meat”, which seeks to rebuild Tory MPs’ support following the Partygate row
Then they continued, “At this moment the discussions regarding the future amount of the license fee for the remainder of the Charter period are still ongoing. However, we expect them to end very soon.
“We will continue to present a compelling case to the Government regarding investment in the BBC.
There are good reasons to invest money in BBC’s ability to serve the British public and UK creative industries.
“This is the argument that we will continue making to the Government until the end.
The pair stated that the Government should set the license fee at the appropriate level.
Then they added, “As soon we have more information, we’ll let you know. We appreciate your hard work, dedication, and creativity.
Ms. Dorries described previously the BBC to be a “Leftwing”, ‘hypocritical” and ‘patronising organisation with too many boring, bored, and aged wig-wearing males performing their presenting duties.