BBC takes on funding over 75s TV licences

Secretary of State for Culture, Media and Sport, John Whittingdale MP, said: “The BBC is a world-class broadcaster and a cultural institution producing some of the best television and radio in the world. However as a publicly-funded institution, it also needs to make savings and contribute to what we need to do to get our country’s finances in order.

“I welcome the BBC’s commitment in reaching this funding agreement, which is an important issue for its own future. I look forward to discussing the full range of issues over the course of the Charter Review period, and will be making an announcement about the process for the Review in due course.”

The following has been agreed with the BBC:

• The government will bring forward legislation in the next year to modernise the licence fee to cover public service broadcast catch-up TV.
• The government will reduce the broadband ringfence to £80m in 2017/18, £20m in 2018/19, £10m in 2019/20 and £0m in 2020/21.
• The government anticipates that the licence fee will rise in line with CPI over the next Charter Review period, subject to: (a) the conclusions of the Charter Review, in relation to the purposes and scope of the BBC; and, (b) the BBC demonstrating that it is undertaking efficiency savings at least equivalent to those in other parts of the public sector.
• The government will consider carefully the case for decriminalisation in light of the Perry Report and the need for the BBC to be funded appropriately – no decision will be taken in advance of Charter Review.

Tony Hall, Director-General of the BBC, said: “We have secured the right deal for the BBC in difficult economic circumstances for the country. This agreement secures the long term funding for a strong BBC over the next Charter period. It means a commitment to increase the licence fee in line with inflation, subject to Charter Review, the end of the iPlayer loophole and the end of the broadband ringfence. In the circumstances, the BBC has agreed take on the costs for free licence fees for over-75s, and after the next parliament, will take on the policy.”