Licence fee to soar?Anger over TV licence price hike

12 October 2005

BBC chiefs are under fire over proposals which would see the licence fee soar to almost 180 GBP a year by 2013.

Television bosses say they need an extra 5.5 billion GBP over the next seven years and want the inflation busting rise to pay for more original programmes and digital services.

Under their proposals the cost of a colour television - currently 126.50 GBP - would rise by over 3 GBP a year, not including inflation.

BBC Director General Mark Thompson and Chairman Michael Grade defended the plan when they appeared before the Culture, Media and Sport Select Committee in Westminster.

But Tory MP Nigel Evans said: 'You are asking for an inflation-busting settlement. But there are millions of people out there who don't get inflation-busting increases whatsoever.

TV poll tax

'How have you got the nerve to come here and say you want to push up the licence fee to near 180 GBP and expect those people to stump up the cash?

'There is a poll tax on their TVs and they have got to pay it.'

The BBC says it can fund 3.9 billion GBP of the extra money it needs through cost-cutting and profits but the proposed licence fee increase would fund the remaining 1.6 billion GBP.

It cited research which found that 81 per cent of the BBC audience thought the licence fee was good value for money and more than 40 per cent would be prepared to pay twice the current licence fee or more.

Director General Mark Thompson told the Commons Select Committee: 'I recognise the licence fee is a burden. But it is our belief, even with the settlement announced today, that the burden will continue to decline steadily as a proportion of disposable income.'

The Government will make its decision next year as part of the BBC charter renewal process.