How is TV funded around the world?

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The debate over the future of the licence fee in the United Kingdom is set to build ahead of the licence fee and royal charter renewals in 2016 and 2017 respectively.

Last week MPs backed plans to give the government power to decriminalise non-payment of the TV licence fee.

Meanwhile, last month, the BBC rejected calls to introduce a voluntary subscription fee for its services.

Responding to a government inquiry into the future of the BBC, it argued the £145.50 licence fee was the "most effective way" to fund the corporation.

But how widespread is the TV licence around the world? And why is it changing in some countries?

World view

TV licence fees, or indirect charges to fund public TV stations, are found in about two-thirds of European countries.

The practice is less common in Africa and Asia, and unknown in North America.

In some countries, such as Serbia and Romania, licence fees are paid through electricity bills.

This was also the case in Greece until June 2013, when the government suspended the country's Radio and Television Company, ERT, as part of drastic budget cuts.

In the UK, residents are legally required to have a licence if they watch or record TV at the same time as it is broadcast.

A colour TV licence costs £145.50 (179 euros) while a black-and-white licence costs £49 (59 euros). In 2012 about 155,000 people were convicted and fined for not paying.

TV licence graphic

"The UK is fairly unique," says Tim Westcott, principal TV programming analyst for IHS Technology. "The UK model is that you have a public broadcaster which doesn't have advertising or subscription as part of its funding mix."

He notes that Denmark, Sweden and Norway are the only European countries with a similar model.

In Japan, TV owners pay a "receiving fee" to fund public broadcaster NHK, with a higher payment for those with satellite TV.

In recent years, both Finland and Iceland have abolished their TV licence fee and replaced it with a tax that applies to all adults.

Other European countries have a TV licence - such as France, Italy and Germany - but in those cases the public broadcaster is also funded by advertising.

Poland has a relatively low TV licence fee (55 euros) but a high evasion rate of 65%. The withdrawal of the TV licence is under discussion.

EVASION RATES ACROSS EUROPE

  • Poland - 65%
  • Italy - 26%
  • Ireland - 12%
  • Sweden - 12%
  • Norway - 9%
  • United Kingdom - 5%
  • Austria - 3%

Source: TV Licensing

"When you have that high level of evasion the cost of enforcing the licence and collecting the revenue is so great that it's actually more efficient for a government to fund the public broadcaster from general taxation," says Mr Westcott.

Looking ahead towards the year 2020, Mr Westcott doesn't expect traditional TV watching to disappear.

"The speed of broadband is going up, and ownership of devices connected to the internet has increased, so it will be more the case that people at home are watching live TV on devices other than the TV.

"But, anecdotally, even where people do have other devices available they do still watch live linear TV. It's a fairly safe prediction that in five years that will still be the case."

Here is a snapshot of some examples of how some TV licence systems are changing around the world.

FINLAND

From 1 January 2013, Finland scrapped its TV licence fee and introduced a public service broadcasting tax - also called YLE Tax - to fund the Finnish Broadcasting Company.

The maximum amount of this tax is €140 (£117 per year).

The rate is worked out at 0.68% of the sum of an individual's income.

Under 18s or those with an income below € 7,353 (£6,152) pay nothing. Pensioners pay between €58 and €106 (£48-£88).

GERMANY

Since the beginning of 2013, German households have had to pay a monthly broadcasting licence fee of almost 18 euros (£15) - 215 euros (£179) a year - regardless of whether they own a television or radio.

The blanket charge funds public broadcasters ARD, ZDF and Deutschlandradio.

Under the previous system different fees were charged based on the type of equipment owned.

GUERNSEY

The British Crown dependency of Guernsey is looking at the future of the TV licence as part of a wider examination of its constitutional relationship with the UK.

The island is not part of the UK or European Union, but a possession of the British Crown with an independent administration. Inhabitants are British citizens.

In February 2014, politician Dave Jones said the TV licence was a UK tax that should not be levied on the island.

In July 2013, TV licensing officers visited Guernsey and caught 130 people illegally watching TV without a licence.

IRELAND

The Republic of Ireland is holding a public consultation on a proposal to replace the TV licence fee with a new public service broadcasting charge.

The proposed charge, which could come into effect by 2015, is partly a response to the increase in the number of people accessing broadcasts online.

It would apply to all households and businesses, with certain exceptions, regardless of the device they use to access content.

The current annual TV licence fee is 160 euros (£138).

Among the options for new ways of TV licence collection are paying via utility bills or the local authorities.

JAPAN

Every owner of a television set in Japan, regardless of nationality, is required by law to pay a "receiving fee" to fund public broadcaster NHK.

There are separate contracts for owners of terrestrial and satellite TV. For those paying annually, the terrestrial fee is 13,600 yen (£80) and 24,090 yen (£142) for both terrestrial and satellite reception.

A rise in the number of people refusing to pay the licence fee in Japan (around the mid-2000s) in recent years has been attributed to decreasing public confidence in NHK following a series of corporate scandals.

In response, NHK began to chase non-payers. Last year it was reported that NHK won a $1,100 (109,000 yen) judgment against a household that refused to sign a licence fee contract after buying a television in 2009.

The wording of the judgment has been interpreted as meaning that a contract could be required for any device that can access TV - such as smartphones, tablets and other devices.

UGANDA

Uganda planned to introduce a licence fee in 2005, although the idea was scrapped before it could be implemented.

The Uganda Broadcasting Corporation (UBC) was established in 2005 under an act meant to transform the state broadcaster into an independent public broadcasting corporation.

The act stated that UBC would be funded by various sources including grants and loans from the government, donations, TV licence fees and advertising.

The plan was to collect an annual fee, 10,000 shillings (£2.38), from each household with a TV set.

But Uganda's main newspapers were overwhelmingly critical, with the state-owned New Vision describing the idea as "an unmitigated wild goose chase".

President Museveni halted the TV licence fee ahead of the 2006 presidential elections. It has never been reintroduced.

A 2010 report on African public broadcasting by the Open Society Initiative for East Africa said that UBC generated about 85% of its revenue from advertising.

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