Licence to Freeze: BBC licence fee set to be frozen

January 29, 2022

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2 min read

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What's going on here?

Culture Secretary, Nadine Dorries, has announced that the BBC licence fee is to be frozen at £159 for the next two years.

What does this mean?

The BBC now finds itself facing severe funding cuts which could have a knock-on effect on the services it provides to the public. However, the Government has justified this freeze as a way of helping people on low incomes, recognising that the cost of living is increasing. Although, the fee is a flat-rate payment which means that everyone is paying the same amount, regardless of their income. This has led to Shadow Culture Secretary, Lucy Powell, questioning the real rationale of the freeze, especially due to the timing of the announcement which has conveniently coincided with the outbreak of the Downing Street party scandal. Not only has the Government faced political criticism in relation to the licence fee freeze, various celebrities have spoken out in support of the BBC, such as Matt Lucas, Dan Walker and Hugh Grant. However, Ms Dorries has assured MPs that she is not against the existence of the BBC but it is the compulsory levy on households with a TV that potentially criminalises the vulnerable that she opposes.

What's the big picture effect?

The BBC has faced criticism in recent years, with critics arguing that there is a lack of impartiality and that the broadcaster has failed to adapt to the changing broadcasting landscape. Therefore, with the BBC already subject to constant pressure from the likes of Netflix and Amazon Prime, the freeze of the licence fee is another blow. Although Ms Dorries emphasised the importance of discussing a future model of funding for the BBC, she did not suggest any alternatives to the licence fee. The Government will need to consider various funding options between now and the end of 2027 when the BBC charter is up for renewal.

Alternatives include a voluntary subscription fee, similar to those used by streaming giants where those who want BBC content pay to access it. However, to provide the current BBC services, this would require approximately 24 million users signing up, each willing to pay £13 every month. There is the option of a government grant where the BBC could be paid for by a tax on income, likely to cost taxpayers around £116 annually. However, direct funding from the government could further undermine the BBC’s impartiality. With no seemingly perfect alternative to the licence fee, what will the government manage to come up with before 2027?

Report written by Imogen Wilson

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