TV licence: fees could be replaced by a new council tax – who should pay? | Personal finance | Finance


A recent House of Lords report recommended the government introduce a new universal council tax. According to the study, this additional housing tax would be difficult to avoid and could be means-tested. This means lower income people would pay less for the BBC and the government would be able to raise the money easily.

A television license is required to watch the programs as they are broadcast live across the UK.

In the age of streaming, license fees are required to stream live content on services such as BBC iPlayer.

Recently, Culture Secretary Nadine Dorries froze licensing fees for two years as part of the government’s consultation on BBC funding.

As a result, the TV license will remain at £159 per household for the foreseeable future until a whole new funding model is introduced.

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Although the Lords Communications and Digital Committee did not fully back a universal council tax, it cited the benefits of such a policy in countries like Germany.

A public inquiry into how the BBC will be paid has been promised by Ms Dorries but is likely to be delayed until Prime Minister Boris Johnson leaves office.

The Committee has sounded the alarm that the BBC risks “stagnation and decline” if it does not present a clear funding plan.

As part of its report, the group warned that the public broadcaster “must do a better job of representing the full range of perspectives and communities that make up our diverse society”.

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Baroness Stowell de Beeston, chair of the committee, explained what the latest proposals mean for the television licence.

On the potential changes, Baroness Stowell said: ‘The biggest threat to the BBC’s future is not a battle between politicians over licensing fees – although decisions on how it is funded are important and becoming increasingly urgent.

“The real danger is that the BBC fails to seize this opportunity to reform itself and demonstrate why it is valuable to audiences in this new world of endless choice.

“That is why the Committee concluded that as far as what the BBC does, the status quo is not an option.”

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One of the funding options that was being discussed in government was a Netflix-like subscription model to pay the BBC.

However, this report warns that such a model would not be financially viable due to the continued popularity of traditional television and radio platforms.

Other options such as an ad-supported model and a BBC monthly fee on broadband contracts were also rejected due to the impact it would have on other commercial broadcasters and the difficulty to evaluate it, respectively.

Speaking to Express.co.uk, a BBC spokesman said: “We welcome the Lord’s report. We agree that we must continue to reform, which we have done at pace.

“It is clear that the BBC must remain relevant and we welcome the report’s conclusion that a BBC market failure would not be a good outcome. Beyond that, we are open-minded about the future and it is true that there is a debate on whether licensing fees should evolve and if so, what comes next.

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