Culture Secretary Tessa Jowell is expected to announce today that the BBC will be set a borrowing limit of between £220 million and £230 million, a figure far less than the £400 million the BBC had sought.
The licence fee is expected to rise by 3% over each of the next two years, following which the increases will slow to 2% for three years and then to between 0% and 2% for the final year.
The government has already announced that a £600 million portion of the settlement will be “ring-fenced” to help pay for the digital switchover.
The BBC had wanted an above-inflation rise in the licence fee in order to boost funding for programmes and digital services.
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