General taxation not considered to replace BBC licence fee – Culture Secretary

The broadcaster has been cash-strapped in recent years following the licence fee being frozen for two years at £159 – before it was increased at a lower rate than the corporation expected, and rising inflation.

The last rise in the household payment, which funds much of the BBC’s operations, saw a £10.50 increase, which brought the charge to £169.50 in April 2024.

Ms Nandy told BBC Breakfast that the licence fee was “not only insufficient, it’s raising insufficient money to support the BBC, but it also is deeply regressive”.

“We’ve seen far too many women prosecuted over recent years for being unable to pay it, and it’s a flat fee that means that poorer people pay proportionately more than anybody else,” she also said.

“I think that doesn’t help the BBC, it doesn’t help the Government, and it doesn’t help people in this country.”

She also said there were a “whole range of alternatives” ministers were considering, but added: “We haven’t committed to any of them.”

The Government will use a review of the BBC’s Royal Charter, which will include a public consultation, to consider funding options to support the broadcaster’s long-term future.

Ms Nandy said she has “already started initial discussions with the BBC leadership about the charter review”, that she hopes will “future proof our national broadcaster until well into the latter half of this century”.

She added: “I think the one that has been speculated about is general taxation.

“That’s not something that we are considering, not least because we want to make sure that we protect the BBC from the sort of political interference that we saw under the last government.”

The Government scrapped the BBC Funding Model Review, along with its expert panel, previously set up under the Conservative administration.

Ms Nandy acknowledged that a subscription model was among the options which were left after ruling out general taxation, but added: “It also leaves a whole range of options which the Culture, Media and Sport Select Committee has been exploring over recent years.

“In other countries in Europe, they find different ways of raising money.

“In France, for example, they have a levy on cinemas. I’m not committing to any of these things at this stage.”

The BBC has been under increasing financial pressure and last year revealed a raft of planned changes, including the axing of in-depth interview show Hardtalk, as it looks at reducing more than 100 news roles.

It has projected its total deficit will increase to £492 million for the 2024/25 financial year.