8 August 2012 Last updated at 12:54

BBC signs agreement to pay £300m for broadband roll-out

The licence fee will pay for broadband, the World Service and local tv

The BBC Trust has signed an agreement with the government's Department of Culture, Olympics, Media and Sport (DCMS) to contribute to the cost of providing broadband, it was announced today.

The BBC will pay £150m of licence fee income a year for two years to the DCMS. This will pay for funding broadband roll-out to rural areas across the UK.

The DCMS aims to provide superfast broadband to at least 90% of premises in the UK and to provide universal access to standard broadband with a speed of at least 2Mbps.

The agreement sets out the Trust's role in overseeing the use of funds provided by the BBC. This includes the Trust being entitled to a seat on the DCMS Broadband Portfolio Board.

Starting in April 2015, the BBC will pay the Department of Culture, media and sport £12.5m a month for two years.

Protest

The agreement stems from the 2010 licence fee settlement. In the settlement it was agreed that the yearly fee of £145.50 for six years.

It was also agreed that the BBC would take on payments of other services. As well as broadband roll-out, the BBC will also take over the cost of the Foreign Office-funded World Service, BBC Monitoring and some of the costs of Welsh language tv channel S4C and local tv. Joint unions say this equates to £340 million worth of extra funding responsibilities.

The unions are urging the incoming Director General George Enwistle to scrap the licence fee settlement. In particular, in the Federation of Entertainment Unions' alternative to cuts, the group protest against the licence fee being used to fund infrastructure projects such as broadband roll-out.

'The additional funding responsibilities placed on the BBC by the settlement in 2010 should be reversed and the money ploughed back into core output,' the document asks.