BBC to freeze licence fee
Siobhan Kennedy
Washington Correspondent
The BBC is to freeze the licence fee for the next six years and absorb the cost of the World Service as part of cuts agreed ahead of the government’s spending review, writes Siobhan Kennedy.
The BBC declined to comment tonight, but a source inside the corporation told Channel 4 News the freeze was the result of weeks of fraught negotiations with the Department for Culture, Media and Sport which has repeatedly said the corporation must take account of the current economic climate and its effect on the licence fee payer.
The source said the measures would result in an effective 16 per cent cut to the BBC’s budget over the next four years of the license fee agreement, which is due to start in 2013.
An announcement is due tomorrow as the government unveils £83bn worth of cuts as part of the Strategic Spending Review.
The BBC had already said, in September, it would freeze the licence fee for two years, which amounted to a 2 per cent cut and a cost to the corporation of £144m, which would have to be found from savings elsewhere.
The BBC declined to comment tonight, but a source inside the corporation told Channel 4 News the freeze was the result of weeks of fraught negotiations.
But clearly the government wanted the BBC to cut even more.
“It will mean some tough choices,” the BBC source told Channel 4 News, referring to possible cuts to programming and staff. But he added that the deal was “realistic” and expressed relief that the settlement had not resulted in an actual cut to the licence fee, which had been mooted.
World Service changes
While further tinkering with the licence fee was expected, the surprise move is the transfer of funding for the World Service from the Foreign Office to the BBC itself.
BBC World Service has always been funded by the Foreign Office – to the tune of about £600m – at ‘arms length’, which has left editorial control within the BBC.
The fear is that World Service, which broadcasts in more than 30 languages, may become vulnerable to general BBC cuts as – for example – the Persian or Urdu service will have to compete with other priorities.
As part of the deal, the BBC will also assume control of the cost of the Welsh language TV channel, S4C.