BBC license fee freeze by UK
Date: 22 January 2022 Tags: MiscellaneousIssue
A complete two-year freeze on license fees of British Broadcast Corporation (BBC) has been announced by the British government.
Background
The licensing fee of BBC makes up about three-quarters of its income. The move is likely to have implications on financial and editorial stability of the broadcaster.
Details
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At present, the license fee will remain fixed until April 2024 and could be completely abolished by 2027.
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The government says that the move was undertaken as a cost-cutting measure for its citizens reeling under the fallout of the Coronavirus pandemic.
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However, political observers say that it is a part of the government’s efforts to bolster support for Prime Minister Boris Johnson.
License fee
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National television broadcaster BBC is funded through a system known as television licensing fee. It is a sort of a tax that needs to be paid by every household.
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Households playing live programmes need to pay a fixed amount to the government. Non-payment is a criminal offence and can result in jail time.
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The current fee is fixed at £159 for a colour TV license and £53 for a black-and-white TV licence. There are discounts for elderly and differently-abled.
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The amount collected as license fee is transferred to consolidated fund of the state and later disbursed to beneficiaries, including the BBC, via the parliament.
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Every April, the price is revised to account for inflation. There was an exception made in 2010 when fee was frozen for six years.
Importance for BBC
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The license fee accounts for about 75% of BBC’s revenues. The rest is covered through commercial deals and grants.
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Lack of funding will prevent the broadcaster to produce valuable content which could affect its ability to compete with other entertainment sources.
Criticism of the license fee
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Families are forced to pay even if they do not watch BBC or its content. The uniform rates are burden on UK’s poorer families.
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The programmes of BBC do not represent cultural minorities and are mostly London-centric. This has invited criticism from other regions such as Wales.
Other funding options
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Bundling BBC services into subscription packages, similar to Netflix.
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Taxing internet and television providers instead of families.
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Opening up BBC for advertisements.