The BBC licence fee is set to increase by more than £10 next year – but bosses had hoped for a hike of closer to £15.
The annual levy currently costs £159, and that figure will rise by 6.7 percent in line with the rate of inflation in September – after the Government negotiated with bosses at the Beeb. It comes as Rishi Sunak told MPs in the House fo Commons that the broadcaster must be “realistic” – as Brits continue to suffer the consequences of the cost of living crisis.
Culture Secretary Lucy Frazer previously urged the BBC: “It’s really important that when things are difficult everyone is doing what they can to ease the cost of living on families.”
It comes as 500,000 fewer Brits are paying the fee at all – while its funding was also decreased in the last year. Meanwhile the BBC continues to struggle against streaming giants like Disney+, Netflix and Amazon.
It had previously been reported that Prime Minister Rishi Sunak was set to block a nine percent increase in the licence fee. The fee freeze is due to come to an end in April 2024, but the Government decided that the proposed £15 annual hike was too high.
The move will be seen as a huge blow to the BBC, as top bosses seek to make £500 million of savings in the face of high inflation and the two-year freeze on the fee.
The BBC is expected to be put under further financial pressure following the announcement of the lesser-than-expected hike, as that is how the broadcaster secures most of its funding.
It comes as top TV executive Dr Samir Shah was announced earlier today as the Government’s preferred candidate to become BBC chairman. Former Goldman Sachs banker Richard Sharp resigned from the role earlier this year after failing to declare his connection to an £800,000 loan made to Boris Johnson.
Since then Dame Elan Closs Stephens has been acting BBC chairwoman. A statement from Culture Secretary Lucy Frazer said: “With a career spanning more than 40 years in TV production and journalism, Dr Shah has a wealth of experience to bring to the position of BBC chair.
“He has a clear ambition to see the BBC succeed in a rapidly changing media landscape, and I have no doubt he will provide the support and scrutiny that the BBC needs to meet the challenges and opportunities of the future.
“His knowledge of the BBC and his belief in its role as a national broadcaster alongside his extensive work to promote diversity in broadcasting will be invaluable in helping to ensure that the BBC reflects, represents and serves communities across the whole of the UK.”
Dr Shah is currently chief executive of award-winning production company Juniper TV, which makes a number of political and current affairs programmes.
He was previously the BBC’s head of television current affairs, and later ran the BBC’s political journalism department at Millbank. He said: “I am delighted to be named the preferred candidate for chair of the BBC and I look forward to the upcoming pre-appointment hearing with the Select Committee.
“The BBC is, without doubt, one of the greatest contributions we have made to global culture and one of our strongest calling cards on soft power.
“If I am able to put what skills, experience and understanding of public service broadcasting I have built up during my career to help this brilliant organisation meet the complex and diverse challenges it faces over the coming years, it would be an honour.
“The BBC has a great place in British life and a unique duty to reach a wide audience right across the country, and I will do all I can to ensure it fulfils this in an increasingly competitive market.”
A BBC spokesman said: “We welcome the announcement that Samir Shah has been selected as the Government’s preferred candidate to take up the role of BBC chair and look forward to him joining the board once the formal process has been completed.”
