BBC Digital Licence Fee Plans Rejected

The government has rejected plans for the introduction of an extra charge to the licence fee to fund the BBC’s digital television plans, but has announced instead an across the board £3 increase to the licence fee.

From 1 April the current television licence will rise to £104 which is equal to an increase of 1.5% above inflation. Similar rises each year up to and including 2006/7 will give the Corporation an estimated £200 million extra per year to help fund new channels and programmes.

Chris Smith emphasised that the extra funding for the BBC must be matched by “improved accountability” on its part. “For each extra £1 the BBC receives from the licence fee, it is expected to generate almost the equivalent through self-help,” he said.

He justified ditching proposals for a digital top-up fee on the grounds that “it would be wrong to signal that it [digital television] is something special and only for the few.” Commercial broadcasters have been campaigning against the introduction of a digital licence levy since it was first proposed (see UK Broadcasters Oppose BBC Digital Fee Increase). When the Gavyn Davies Report into proposed funding recommended an extra digital licence levy, the BBC welcomed its findings and opposition increased (see Digital Licence Fee Could Be £24).

Responding to the Gavyn Davies Report, Chris Smith welcomed the BBC’s main priorities to improve established services – especially BBC1; to expand education work; to develop interactive services and to enhance services tailored for Scotland, Wales, Northern Ireland and the regions. He said: “The Government’s aim is to ensure the BBC1 is able to offer choice, quality and value for money for viewers in the digital age. It should provide a strong and distinctive schedule of benchmark quality programmes on all its services.”

Department of Culture, Media and Sport: 020 7211 6272