UK Government to BBC: 'Don't Expect Asked-For Fee Rise'

21 April 2006

Britain's culture, media and sport secretary, Tessa Jowell, sent a clear signal to the BBC on Thursday that its requested increase in licence fee income won't be forthcoming.

The publicly-owned broadcaster is funded by a mandatory annual levy - currently £126.50 ($225; €183) - on all UK homes owning a TV set, irrespective of whether they watch BBC programming.

In response to a question from a House of Lords Select Committee probing the BBC Charter Review, Jowell dismissed the BBC's proposed formula of current fee + inflation + 2.3%.

Said Jowell: "[It is] in our view an opening bid. This is a negotiation and the negotiation is just beginning. I would certainly expect the figure to be lower than the BBC proposed, yes."

The government view, said Jowell, is that the licence fee should be set at a level which allows the BBC to provide the sort of programmes and services viewers expect, at the same time allowing the corporation to "continue at the forefront of innovation and new technology".

Another determining factor is the viewing public's willingness to pay the fee, as is the value they attach to the BBC.

The increase currently tabled by the BBC would generate more than £4 billion of extra revenue annually. Some observers believe its shrewd and pragmatic chairman, Michael Grade, would happily settle for half that figure.

Data sourced from; additional content by WARC staff