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What could replace the BBC licence fee?

Nadine Dorries’ announcement of major changes to the BBC’s funding model is just the latest attack on the broadcaster by Conservative ministers over the past 12 years. There have been repeated attempts to decriminalise non-payment of the licence feeenormous real-terms funding cuts and the decision to make the BBC take the blame for abolishing free licences for over-75s. 

In the short term, the more damaging news for the BBC is the government’s intention to freeze the cost of the licence fee for two years. This dooms the broadcaster to another round of deep cuts to its output that will weaken its offering to the UK and the world.

In the long term, the bigger issue is the government wants to abolish the BBC’s existing funding model when the broadcaster’s royal charter expires in 2027.

Households with a television used to receive live broadcasts (or watch iPlayer) are charged £159 for a licence, raising £3.2bn a year for the BBC and and the Welsh channel S4C. Yet there are hundreds of thousands of prosecutions a year for non-payment of the licence fee – disproportionately affecting women who are at home when inspectors call. Also the number of households that pay the fee is declining.

Yet with countries around the world phasing out their television licence fees, the writing has been on the wall for the British version for some time – even if the exact timing and format of its replacement is unclear.

Here are some of the alternative funding models:

Charge a levy on every broadband connection

The existing television licence is levied on the device traditionally used to receive most BBC content. A more modern equivalent would be a levy on every broadband connection in the UK used to fund public service media. This could be relatively easy to enforce, with the money collecting through existing broadband providers and has the benefit of being a near-universal. But adding £13 a month to the cost of a broadband connection could make internet access prohibitively expensive for some households.

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