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£4 rise in BBC licence means more repeats
Last updated at 23:22pm on 18.01.07
Culture Secretary Tessa Jowell
The BBC could be forced to cut back on new programmes and show more repeats after the Government refused to grant an above-inflation rise in the licence fee.
Corporation bosses have been left reeling by the decision to increase the licence fee in April by only £4, from £131.50 to £135.50.
It was also revealed that by 2012 the licence fee will have risen by only a further £16 to £151.50.
In each of the next two years, the fee will rise by three per cent, which is the rate of inflation as measured by the Consumer Price Index - and lower than the inflation rate of 4.4 per cent as measured by the Retail Price Index.
Efficiency savings at the BBC are now likely to result in more redundancies at the corporation, which is already in the process of axing 4,000 jobs.
A number of the BBC's more ambitious projects are expected to be shelved, with less money spent on expensive types of programming such as drama and entertainment shows.
A senior insider said that plans to cut the number of repeats on prime-time BBC1 are likely to be dropped.
The source said: "If you do an hour of new factual programming it costs £100,000. Factor that across all the channels, that is a hell of a lot of money. It also means we won't be able to do a lot of the new programmes we wanted to do as soon as we would like to."
But some critics accused the BBC of pleading poverty.
They pointed to an estimated 0.8 per cent increase in the number of licence fee payers over the six-year period of the settlement - which should result in an extra £600 million for the BBC.
John Whittingdale, Tory chairman of the Commons Culture Select Committee, said: "I think the settlement will continue to deliver a real terms increase in the amount of money available to the BBC."
The BBC originally claimed it needed a licence fee rise of 2.3 per cent above inflation, which would have been an extra £5.5 billion in its coffers. It later lowered this request to 1.8 per cent above inflation.
But Chancellor Gordon Brown was unimpressed. He believes that the BBC should be subject to the same efficiency savings as the rest of the public sector.
The BBC has also been told its borrowing limits will be tighter than it wanted.
It had wanted to borrow up to £400 million, double the figure it is currently allowed. But its borrowing limit will be raised only to between £220 million and £230 million.
BBC director-general Mark Thompson said the deal will cut £2 billion from the corporation's spending plans.
"That's not a gap that any organisation can swallow comfortably," he added. "The quantum of the settlement remains a big disappointment."
He said the settlement risks "diverting more money away from content creation".
Mr Thompson claimed the £600 million boost from the increase in the number of licence fee payers would be "more than used up" by paying for the cost of digital switchover and the targeted help scheme for the vulnerable.
But Culture Secretary Tessa Jowell said: "If I was Mark Thompson I would look very closely at the public priorities that have emerged during this review.
"I would look at the priorities identified by the licence fee-paying public and just remember that the legitimacy of the BBC increasingly comes from them."
She added that the settlement ensured that the planned move of key departments from London to Salford would go ahead.
Reader views (7)
Who cares? We all watch Sky anyways.
- Jay, London
If the BBC doesn't get ratings you get people cry 'close it down no one watches it', if they do get ratings then 'they shouldn't be putting on popular programmes - they're supposed to be a public service broadcaster'
Go to other countries and you'll soon appreciate what a gem the BBC is. And any organisation that is seen as the enemy by both Tory & Labour must be doing something right.
- Alfie, London, UK
I once went into Bush House and ate in their staff canteen with some producers. Talk about a bunch of Oxbridge educated, usless degree educated, empire building useless floppy haired twits! These are people who couldn't get a proper job in the real world, but who have found their niche in a job that we pay for.
The way they protect their jobs is to create their little empires with more and more poeple working under them on bigger and bigger budgets, and claim that the are indespensible (which they are not).
And to make us quake in out boots, what do they threaten us with? More repeats.
- Stephen, Guildford
The BBC's income is amazingly over adequate. Public service broadcasting is just that. It should not compete for viewing figures with it's commercial rivals. The BBC's budget is wholly realistic enough to provide it's priorities of news, current affairs, culture, the arts and meaningful entertainment.
- William Grierson, Kimpton, UK
Nobody asked the BBC to start extra channels (which are either repeats or children's programs), let alone a massive web site that deals with material no relevant to the broadcaster. If they trimmed back to twp channels of good material and became a subscription service, they could still make a profit while providing excellant new material.
- Graham, Reading, England
Tessa Jowell should have taken the opportunity to do the right thing and scrap the licence fee. It's not an issue of cost as £135 a year is hardly a problem for most people. It is an issue of principal though. The licence fee became unjustifiable once the BBC ceased being a majority entertainer. With the plethora of broadcasters and broadcast medium now available the only way the BBC can survive, even in a much reduced form is for it to accept advertising. This would immediately remove the need for the TV Licencing agency and its army of spies. No one would need to spend time in prison or face a fine simply for not having a TV licence.
For those in favour of retaining it, ask yourself how you would feel if the Govt. decided that in order to read a newspaper you needed a newspaper licence. The state newspaper would be The Guardian which you could get 'free of charge' provided you had paid your Newspaper Licence fee. Anyone who read a newspaper without first buying a licence would face £1,000 fine and six months in jail. Yes I know it is a mad idea but so is having a TV licence.
Scrap it - now!
- Debbie, Harrow
The BBC needs to get rid of Jonathan Ross and that horrible little Irish comedian with the flashy jackets, both of whom are paid millions a year. Wogan is also vastly overpaid, as is the scowling angry-looking Huw Edwards. WHY does the BBC have a huge Website. Did you know they have an enormous bank of interpreters, for they present the news online in 31 (THIRTY-ONE) languages. WE are all paying for this! And apparently the BBC has five orchestras we pay for, according to a TV report I saw tonight. And don't tell me the BBC doesn't advertise: what about the books and DVDs it advertises for sale on TV? What about its ads for BBC3 and BBC4 which are not free over-the-air stations but which need additional expense in order to receive, Sky or Freeview?
What about the astronomical salaries the top people at the BBC are paid? What about all the money they waste year after year on their excursions, parties, taxis, etc? And the giant sums they spend on duplicating foreign correspondents. Instead of looking to grab more of our money to use frivolously, they need to start getting rid of all the fat!
- Tom Brownstone, Frome, UK
