BBC could face competition for state funding

Lord Carter, the newly installed communications minister, has indicated that the BBC could face competition for state funding of public service content in a fully digital future.

The former head of Ofcom refused to rule out the possibility of splitting the licence fee following completion of the digital switchover in 2012.

“Parliament very recently had that debate and decided against contestability [of funding],” he said. “Does that mean that, for ever and a day, if looking at funding structures you would rule out any form of sharing the licence fee? I don’t think it would be sensible to do that.”

The comments follow the recent scandal over Jonathan Ross and Russell Brand and Friday’s announcement by the BBC Trust that the corporation would have to shelve its plans for local news websites with video content (see BBC Trust rejects local online video proposal).

Carter also said that the money set aside to fund digital switchover until 2012 could provide alternative funding for public service content in the present.

The £600 million ringfenced to fund the switchover was added to the BBC’s licence fee settlement in 2006.

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