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BBC may have to pay for pensioners' free TV licences

Michael Crick | 17:44 UK time, Monday, 18 October 2010

With fewer than 48 hours to go, details of the Spending Review are far from settled and the BBC could be a victim.

I understand from both government and BBC sources that one decision still being actively considered by ministers is to transfer the £556m annual cost of providing free TV licences to pensioners over 75-years-old, from the government's books to the BBC.

This would take effect from the time of the next licence fee settlement, due in 2012.

The level of the TV licence would be increased as a result, but probably by no means enough to make up for the full £556m cost.

I understand that ministers have already rejected an earlier similar plan to transfer the cost of the BBC World Service from the Foreign Office to the BBC.

This is potentially a very big story indeed, and could lead to a big bust-up between the BBC and ministers over the BBC's independence.

The cost of providing free TV licences is currently £556m a year, and with our ageing population that cost is rising rapidly. The bill is currently met by the Department of Work and Pensions (DWP), so taking more than half a billion pounds off the books will be a quite saving for them, and may mean they can avoid cutting some benefit or other.

The effects for the BBC are quite serious. If the whole £556m cost is to be met by the current licence fee, which brought the BBC £3.45bn in 2009-10, it would be the equivalent of a 16% cut in the BBC's licence fee income.

I would be astonished if the BBC Trust took this measure lying down. I would expect them to fight it tooth and nail. The BBC will no doubt argue it's wrong for the licence fee to be used to pay for a welfare benefit, and a severe erosion of BBC independence.

A BBC Trust spokesman told me tonight:

"Anything at this stage is speculation as we have yet to see the detail of the comprehensive Spending Review. That said, it would be unacceptable for licence fee payers to pick up the bill for what is a DWP universal benefit."

This will be very awkward for the BBC politically. What is more popular - high salaries for BBC stars and senior execitives, or free TV licences for the elderly?


  • Comment number 1.


    The BBC are doing their best to drive anyone with more than three working brain cells away. How ironic to end up notionally paying for 'viewers' who don't watch!

  • Comment number 2.

    How many over 75's getting a 'free' TV licence are actually living on their own and how many are living with family who, without having grandma or granddad living with them would normally be paying for their licence?

    Perhaps if the latter families had to pay then the cost would come down.

    As it was a Government decision to give the over 75's free licences then the cost should come from general taxation.

  • Comment number 3.

    ..... and Utility companies ought to give their elderly customers the Winter Fuel payment at source.

  • Comment number 4.


    yes. why should the taxpayer subsidise foreign multinationals. however given the weakness of the regulator that cost will be passed directly onto us.

    as for bbc. looks like some talent will be downsizing? or going into the commercial media where no doubt, as they keep telling us, they can double or triple their salaries?

  • Comment number 5.

    A few things that are important to get across:

    * This is an attack on benefits for old people. The government wanted to find cuts, but are trying to shift the blame onto someone else. The government knew the BBC were unable to fund this.
    * As above, this is a direct reversal of David Cameron's pledge to protect benefits for the elderly.
    * This is an attack on the BBC, by factions within the government. They want to force through a 26% cut on the sly.

    Written in the past tense; the above should be the BBC PR line. The headline of your article should change to, "Government axes pensioners' free TV licenses".

  • Comment number 6.

    Instead of taking several millions out of the BBC budget to pay for BBC World Service and free TV licences for pensioners why not axe a useless
    FCO-sponsored quango like British Council whose latest contribution to
    'soft diplomacy' is (grotesque) support for a fashion show promoted by
    the daughter of the Uzbekh dictator! Surely 'an open, outward-facing nation' like Britain 'whose political, economic and cultural authority far exceeds our size' needs the BBC more than it needs British Council?

  • Comment number 7.

    If banks paying high salaries and bonuses are to be penalised, why not the BBC ? The amounts paid to some presenters and so-called celebrities are obscene. And why should I have to pay for the mostly dumbed-down trash and left-wing bias spewed out by the BBC ?
    Excellent idea to fine the BBC £500m.
    Next step is to scrap the licence fee and let the BBC survive in the market.
    Well done to Jeremy Hunt , but he must go further.

  • Comment number 8.

    I hope that the government reconsiders the wisdom of this policy. I would much rather pay a bit more in the fee or in tax so that pensioners could enjoy this small, but important, benefit. It is interesting to find the axe falling on benefits for the unemployed, university students, and pensioners without much pain directed at the most well off. This cannot be right.

  • Comment number 9.

    I think someone is putting the cart before the horse. If the government chooses to exempt certain parties from paying the TV Licence Fee that is a matter for the government and so they should pay; not the BBC.

    Mind you, I am advised by a friend of Boris that Jeremy is not short of a bob or two: perhaps the pair could make a contribution out of their generous compensation.

    Alternatively I look forward to episodes of Celebrity Incontinence.

  • Comment number 10.

    today I have to get my TV Licence and it is not cheap but it is one of the most value for money expenses I have to endure, the BBC is one of those luxuries you don't miss until you don't have it. The rest of the world envies us for our beloved BBC, and you can trust the BBC, how many other world broadcasters can you say that about? Documetaries, regional output, sport and Newsnight, what is there not to like about an institution like the beeb. To keep cricket on free to view, Champions league football I would have paid more to ensure those sports are there for younger generations as cricket as gone down since it became the preserve of minority channels, it is the cheapest and best thing yopu will buy all year////

  • Comment number 11.

    We're all spending! We're all trying to get it back on track! When does it stop?!?

    I've written about travel in a positive light - here's hoping the drops in the ocean are raising the water level. Oh wait! No - the ice caps!

    I'm not sure of anything any more!

  • Comment number 12.

    Stevie 1.26
    That's fine if you are happy to pay for it. But why should those of us who loathe everything the BBC stands for have to finance it ? Doesn't seem fair to me. Why shouldn't it be a subscription channel so those who want it, pay for it ?

  • Comment number 13.

    This is surely one benefit (along with free bus travel for those yet to retire) which should never have been introduced? Watching the TV is not a right and it comes as a package - to watch it you have to have a licence, in the same way to drive a car you have to have a licence, insurance, road tax, mot.If you can't afford the licence, you can't watch a TV - what next, providing the TV set too? This benefit may be excused if the over 75 is living by themselves but should not be provided if they are living with others.

  • Comment number 14.

    Nobody in any walk of life welcomes the jolt of a drop to their income. However when it happens most people try to adjust and to focus on their priorities and to look for savings where they can. I really don't see why the BBC should be immune from the disciplines of belt-tightening facing the rest of us or to seek to use your power to engage in special pleading in your own interest.

  • Comment number 15.

    'This will be very awkward for the BBC politically. What is more popular - high salaries for BBC stars and senior execitives, or free TV licences for the elderly?

    Rather depends who one thinks one's audience is, 'internal' or external. Which has been an issue of late. Ask Helen Boaden.

    But I do note proof-readers and/or sub-editors are early victims of the cuts.

    Anyway, as suggested there could be some mileage, airtime-filling wise, with doing a 'cuts' special, only without that expensive leaving the building and interviewing a moppet a day whose local whatever is under threat. Now the BBC can come to appreciate it's not quite so easy when the cookie jar is bare, and everyone who liked you for the endless cookies is still hungry for more...

    MON - BBC Breakfast - 'But what about Chris' cakes???!' wails Mr. Moyles' generous R1 producer/boss.

    TUE - R4 Today Show - 'How do I get to Cancun?' a clearly distraught enviro section, plus WAGs, decry as winter closes in.

    WED - Online - 'Sadly the next round of licence feepayer-funded Twitter training may have to be on their own dollar' says Head of Editorial, bemused by most editors still punting out rather non-impartial tweets.


    Answers, actually not forthcoming, or even on a postcard... here:

    ps: Do any of your 'sources' ever go on record? Even at the BBC. Or do we just take your word on it all?

  • Comment number 16.

    You only have to look at ConservativeHome (the website for Tory activists) to see the ideological hatred there for the BBC.

    Add to that the requirement to persecute the BBC in order to keep Mr Murdoch on board.

    It's sad, but I'm not surprised. These are probably only the opening shots.

    PS I consider the BBC licence fee very good value for money.

  • Comment number 17.

    Donald 5.20

    No-one is forced, on pain of imprisonment, to pay for Murdoch's media empire, but we are forced to pay for the BBC. Is that fair ?

  • Comment number 18.

    PS. You only have to watch or listen to the BBC to realise their "ideological hatred". Imagine how you would feel if you had to pay for "ConservativeHome" !

  • Comment number 19.

    QUOTE: * why should I have to pay for the mostly dumbed-down trash and left-wing bias spewed out by the BBC?
    *fine the BBC £500m
    * Next step is to scrap the licence fee
    * Well done to Jeremy Hunt, he must go further. UNQUOTE

    Isatou (7,12,17,18),

    Is a typical ConservativeHome poster; the first of many on here, no doubt. It's ideological hatred, nothing to do with helping with the UKs structural deficit. The BBC are viewed as an enemy that needs to be destroyed. Watch out - they have their gun sights on a whole lot of other national institutions.

    God help us!

  • Comment number 20.

    The Government (The CONDEMS) continue with their despotic take on democracy in which power translates to authority and assertion. Their simplistic style of domineering negotiations with choices of restrictive alternatives, structured around their understanding of commercial terms, limits their credibility.
    The BBC world service is not in competition with any other media; it is a unique, non-political, champion that provides genuine insight into the world opinion of the British.
    The service over many years has established an accessibly safe and authentic resource of opportunity for BBC correspondents; In the name of freedom, it deserves a public and unrestricted support.
    Relating this to an either or choice of over 75s licence fees is nonsense and has no connective reasoning. Let each public service department create their own budget concoction around their own operational costs rather than raiding the resources of a unique public institution.

  • Comment number 21.

    19. At 6:47pm on 19 Oct 2010, Donald Rockhopper

    God help us!

    Who is 'us'?

    Not really expecting an answer, as these so far seem not to be forthcoming in favour of tribal rallying cries.

  • Comment number 22.

    Many, many people object to be forced to pay tax on pain of imprisonment and be subjected to a highly biased output.

    The BBC is 'supposed to be impartial' it is obvious to all but the blind that it is not. - Even many of the BBC staff have given up the pretense of non bias.

    @19 I guess you would not wish to be forced to pay for the Daily Mail.


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