Middle-class families face paying more to watch the BBC to help fund free licences for benefit claimants in plans unveiled on Tuesday.
Favourites such as Strictly Come Dancing and The Traitors could be placed behind a paywall and advertising introduced for the first time in the corporation’s 100-year history.
The radical proposals were unveiled by Culture Secretary Lisa Nandy as she set out her vision for the funding of the BBC from 2028 as it enters its once-a-decade charter renewal. Ms Nandy defended the scandal-hit national broadcaster, heralding it as ‘an institution like no other’.
Despite the number of households refusing to pay for a TV licence growing rapidly, the Government backed the £174.50 fee, describing it as ‘tried and tested’ and saying it was not considering an alternative.
But just three weeks after Rachel Reeves’ ‘Benefits Street Budget‘, which saw taxes raised by £30billion to partly fund huge new welfare handouts, the plans suggest wealthier households may have to pay more to fund targeted ‘concessions’ or even free licences for benefit claimants.
The policy paper said the Government was considering ‘further targeted interventions to support household budgets’, and was looking at international models, hinting heavily at following the German template, where concessions are given to those ‘who receive social benefits and to some students’. The German guide states: ‘Individuals who receive social benefits… may be exempted from contribution.’
The public consultation adds: ‘Changes to the BBC’s funding model could allow new TV licence concessions, which would provide discounted TV licences for some households such as those facing significant financial pressures. New concessions could require other households to pay more.’
John O’Connell, chief executive of the TaxPayers’ Alliance, said: ‘It’s absurd to squeeze middle-class taxpayers harder while floating new licence fee exemptions for benefit claimants.
‘The licence fee is already regressive, and shifting more of the burden on to working households just entrenches unfairness and fuels resentment.’
Former culture secretary John Whittingdale said the licence fee model was ‘unsustainable’ and should be replaced. He added: ‘Shifting it so that rich households pay more or small, low-income households don’t, is not going to address the big problem, which is that the number of people who are not paying it at all is going to go on increasing.’
Ms Nandy said: ‘This Green Paper begins the conversation about how to ensure the BBC remains the beating heart of our nation for decades to come.’
Despite the number of people who pay the fee declining – down from 25.2 million in 2020 to 23.8 million in the latest figures – it provides the national broadcaster with more than half its income, bringing in £3.8billion this year.
Ms Nandy is looking at other options for the corporation to raise funds, including allowing the BBC to run adverts across all of its services. Another option would see the corporation restrict adverts to iPlayer, the BBC website, and videos posted on YouTube. But the proposals would likely draw a huge backlash from commercial competitors, with Mr Whittingdale predicting the likes of ITV and Channel 4 would be ‘appalled’.
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Another idea is for older programmes on iPlayer to go behind a paywall in a ‘top-up subscription service’. There are also plans for a ‘more expansive’ Netflix-style service putting hit entertainment shows behind a paywall. Kemi Badenoch said the corporation ‘urgently needs to get its house in order’ before a future funding model is decided.
The Tory leader said: ‘If it can’t maintain high editorial standards and produce truly impartial news, that puts the future of the licence fee in jeopardy.
‘The BBC needs to make sure that it works for all of the people of the United Kingdom, not just the metropolitan elites.’
The initial consultation will run for 12 weeks, before a White Paper laying out the Government’s preferred proposals is published. Any changes would come into effect from 2028, after the expiration of the charter.
Reform MP Richard Tice said: ‘The licence fee is an obsolete tax that has no place in a modern competitive media landscape.
‘A Reform UK government will scrap the BBC licence fee.’
The consultation also suggests the charter should be updated to ensure that ‘accuracy’ is deemed just as important as ‘impartiality’. It comes just weeks after the resignation of director-general Tim Davie and BBC News boss Deborah Turness over the doctored Donald Trump speech.
Mr Davie said: ‘We welcome the publication of the Green Paper and the start of the public consultation on the future of the BBC.’
