BBC funding frozen for 2 years as Cabinet minister attacks public charges

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Over the weekend, a British government minister attempted to deliver a deathblow to the BBC’s main source of funding, a license fee charged every year to every household with a television.

Nadine Dorries, who oversees the BBC at the cabinet, said on Twitter that an impending royalty announcement “will be the last.” But on Monday afternoon, standing in the House of Commons in Parliament, she backtracked on her contentious request by announcing that licensing fees would be frozen for the next two years – a move that could require substantial budget cuts to the public broadcaster just to keep up with rapid inflation.

The funding freeze is “disappointing”, BBC chairman Richard Sharp and chief executive Tim Davie said in a statement, and “will require tougher choices”.

For four years from April 2024, fees will again rise in line with inflation, Ms Dorries said. The BBC and the government have been negotiating since late 2020 over how much TV owners will have to pay over the next five years. Over the past five years, fees have increased each year in line with inflation.

“This is a very good result compared to alternative results, including the elimination of license fees” and additional increases below inflation, said Claire Enders, founder of Enders Analysis, a research company on the media.

Three-quarters of the BBC’s revenue, around £3.75bn ($5.1bn), comes from the license fee, which is currently £159 ($217) per household. The license fee was introduced in 1923 to pay for radio. Today it funds eight national television channels, 10 radio stations, local stations (including Welsh and Gaelic language services), educational content and on-demand services. Fourteen percent of licensing fees fund non-BBC television.

Ms Dorries, who is Culture Secretary, and her Tory colleagues have long argued that the BBC needs a major overhaul of the way it funds it. They also said he was too left-wing and too London-centric.

“The days of old people being threatened with jail time and bailiffs knocking on doors are over,” Ms Dorries said on Twitter on Sunday. “Now is the time to discuss and debate new ways to fund, support and sell great UK content.”

In Parliament on Monday, in a more conciliatory tone and citing the BBC’s ‘unique place in our cultural heritage’, Ms Dorries said that ‘it’s time to start asking these really serious questions’ about BBC funding and whether the licensing fee was appropriate. But it did not state a policy. “We are announcing a debate and a discussion,” she said.

Funding for the BBC through the license fee is guaranteed until the end of 2027, after which the BBC’s Royal Charter expires and its mission, public purpose and method of funding must be renewed. New mandates will be decided with the government of the day. But before that, there will be another general election, which will determine the fate of the royalty.

In Britain, inflation is at its highest level in a decade, and the license fee freeze could force the broadcaster to make even more cuts. Ms Dorries said any increase could not be justified as millions of households were squeezed by rising energy bills and consumer prices. The Conservative government is also raising taxes in April to fund more health services.

Since 2016, the BBC has embarked on a massive cost-cutting plan, trying to save £800m a year. This financial year, he expects the savings to exceed £950m. Last year it cut 1,200 jobs.

The changes came as part of an overhaul of the BBC’s management. Since the end of 2020, a new general manager and president have been installed. Deborah Turness, who was president of NBC News, will be the BBC’s next news director.

After complaints about bias in its media coverage, the broadcaster last year announced a plan to spend an additional £700m outside London by 2027 and relocate 400 jobs.

The broadcaster faces increasing pressure, and not just from the government. The BBC is trying to reach more diverse and younger audiences while cutting costs, as big-budget streaming companies such as Netflix and Spotify expand in Britain.

On the future of the BBC’s funding and purpose, Mr Sharp and Mr Davie said that while all options should be considered, “the BBC belongs to the public, and their voice must always be the loudest when it comes to determining the BBC’s role in the future.”

In Britain, the debate around fees often centers on the BBC news service and whether everyone should be required to pay it, said Meera Selva, deputy director of the Institute. Reuters for the study of journalism at the University of Oxford. The BBC also broadcasts other content, including documentaries and dramas. School closures during the pandemic have also increased children’s academic performance.

The next question Britain needs to answer, Ms Selva said, is “are we willing to pay for all the content or just the news? »

Alternative funding ideas include a direct government grant, a subscription service, or a membership system that makes its content available to everyone for free but is funded by voluntary members. But unlike, say, Netflix, the BBC is asked to provide many different services and is required to provide content that may not be commercially viable, Ms Selva said.

“Levy,” she said, “is the closest model we have to preserving editorial independence.”

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