The TV licence fee, which is used to fund the BBC, will reportedly NOT go up this year (or the next), following a decision by culture secretary Nadine Dorries.
- Update: Now it’s official, with the fee being frozen for two years – Read more about it here.
The secretary then announced that this will be “the last licence fee announcement”, hinting that the licence may be replaced by a different funding model in the future.
Without the upcoming freeze, the TV licence fee would have increased with the rate of inflation – as it did last year – which would have meant a new fee of £167/year, instead of the current £159/year.
According to The Sunday Times, the official freeze announcement will be made in the coming days, and is part of a plan to appeal to Tory backbenchers with cuts to the rising cost of living.
The freeze will be kept in place for two years, after which the issue will be revisited. In 2027, when the current charter ends, the government will look again at the possibility of turning the TV licence into a subscription model (see more on that below).
Currently, anyone who watches the BBC live, or streams it via BBC iPlayer, has to pay the TV licence fee.
Furthermore, if you watch any live TV from any broadcaster (even an international one), you also need to pay the fee (See our full guide on whether you need to pay the TV Licence fee or not).
Live TV on streaming websites such as YouTube also requires a TV licence – but watching broadcasters on Twitch and similar services does not require a licence.
As things are now, failure to pay the TV licence fee is a criminal offence, and evaders can end up paying a fine of up to £1,000 or even get sent to jail by the courts, if they don’t pay the fine.
In 2020, the government was debating whether to change the terms of the licence fee, and specifically whether to decriminalise it or not. Eventually, the government decided to leave the current criminal sanctions on evading the licence fee where they are.
The last time the TV Licence fee went up was in April 2021, from £157.50/year for a colour television to the current £159/year.
Tim Davie, the BBC’s Director-General, said last year that when you compare the licence fee to other streaming services – the BBC’s increases remain modest:
“Netflix, Spotify, Apple, [had] price rises of 20-30% this year”, he said. “We’ve gone up 1%, and we’re down 30% in real sums to 2010.
“When you ask people what they would pay for the BBC, we’re well ahead of the £13. We are not asking to go well ahead of that, but we need to make sure we are not stripping this service.”
Last year also brought with it the TV Licence fee changes for the over-75s, as the government phased out subsidies the BBC was getting.
In light of that, those who were previously exempt from the fee, had to start paying it, and only those who are eligible for Pension Credit are still exempt from paying the fee.
If the TV Licence fee freeze becomes official, the BBC will have to face more substantial cuts, as not only would rising inflation cut into its budget, but it also suffers from an increase in people who choose to ditch the TV licence entirely.
TV Licence Fee VS The Competition
Without the expected increase, the TV Licence fee would remain at £13.25/month for two years. That’s still higher than most other “competing” streaming services in the UK.
- Netflix is currently £9.99/month for the standard plan, and there’s an even cheaper plan for £5.99/month (though there’s a chance Netflix’s prices will go up this year).
- Disney+ is currently £7.99/month.
- Amazon Prime Video is £5.99/month.
- Apple TV+ is £4.99/month.
Over the past couple of years, some have called for the TV licence fee to be abolished completely, and replaced by a subscription-style service, like Netflix and Disney+.
Last year, a report by the BBC estimated that if one was to subscribe to the range of media the BBC currently offers, instead of the current model, then that subscription would end up costing £453/year (or £37/month).
That’s when you take into consideration BBC iPlayer, BBC Sounds, the BBC News website, nine national TV channels plus regional programming, 10 national radio stations and 40 local radio stations.
According to Clare Sumner, Director of Policy at the BBC, most people prefer the current mandatory licence fee model:
“When we ask people how they wish the BBC to be funded, the licence fee is the most popular answer compared to advertising and subscription models.”
Tim Davie also spoke in the past against turning the BBC into a subscription-based service, saying that while they might make “a decent business out of it”, it would make the BBC “just another media company serving a specific group”, instead of serving wider groups of the population.
In a Tweet she posted today, ahead of the upcoming freeze announcement, culture secretary Nadine Dorries said it’s “Time now to discuss and debate new ways of funding, supporting and selling great British content”, and that “This licence fee announcement will be the last.
“The days of the elderly being threatened with prison sentences and bailiffs knocking on doors, are over.”