BBC licence fee on the brink: Panicked bosses discuss new funding model as tax set to end

BBC licence fee 'has many flaws' says John Whittingdale

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Members of the broadcaster’s board are thought to have seriously looked at possible different methods of raising money last month. They looked at how they could best raise the corporation’s £3.8billion annual income if the Government goes ahead and scraps the current model.

Discussions are understood to have been held by BBC executives at an away day last month.

It came just days before Culture Secretary Nadine Dorries published proposals for future legislation which included plans to review funding.

The licence fee is guaranteed until 2027 but discussions will soon need to be had about how to continue funding the BBC beyond then.

Execs at the BBC have repeatedly said the current model – which has been in place since the broadcaster was first set up in 1922 – is the best way to fund the corporation.

But fears that the Government are set on abandoning the licence fee has led to talks already being held about the future.

In January, Ms Dorries announced she was freezing the £159 cost of the licence fee for the next two years to help with the cost of living crisis.

She confirmed it would then rise with inflation until 2027 and would likely be scrapped after that.

The minister said on social media: “This licence fee announcement will be the last.

“The days of the elderly being threatened with prison sentences and bailiffs knocking on doors, are over.

“Time now to discuss and debate new ways of funding, supporting and selling great British content.”

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Ministers say no decision will be made without a full consultation, but The Times reports BBC big wigs have considered options including a Netflix-style subscription, a television tax linked to household income, and Government grants.

The conversations are said to have not been on the formal agenda for the awayday but board members were told in advance that the discussions would take place.

Conversations were about exploring the possibilities rather than deciding on a preferred option.

Members of BBC board include the corporation’s chairman and former adviser to Rishi Sunak, Richard Sharp, director-general Tim Davie, and Sir Robbie Gibb, who was Theresa May’s director of communications.

The revelations come as yesterday the head of the National Audit Office warned the BBC needed to do “scenario planning” on its future income.

Gareth Davies told a parliamentary committee that ministers should determine what they want the BBC to achieve.

“It would be an unwise approach for all parties in this to say, ‘Here’s the funding model, now let’s work out what you’re for’,” he said.

“That really would be backwards.”

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