BBC Trust Proposes to Freeze License Fee Until 2013‎

LONDON: The BBC Trust has proposed to the government that the license fee should remain at its current level, £145.50, for the next two years, resulting in an estimated £144 million deduction from planned BBC budgets.

Under the terms of the current settlement, the BBC would get a 2 percent increase in 2011-12, with the amount for 2012-13 to be determined within the range of 0 to 2 percent. The agreement also calls for the Trust to keep the financial needs of the BBC under review, to ensure that the executive board is not authorized to spend more public money than is needed to appropriately fulfill the BBC’s responsibilities.

The loss incurred from the two-year freeze would mean some adjustments, said the Trust, including on-air changes, particularly at a time of when spending has been increased on infrastructure projects and digital switchover.

BBC Trust chairman, Sir Michael Lyons, said: "The Trust remains committed to the principle of ring-fenced multi-year license fee settlements. It is a key part of the BBC’s independence that the government grants such settlements and does not re-open them before they come to an end.

"However, we also recognize that the British public is facing an exceptionally tough financial climate. In June, as part of the Trust’s role in ensuring value for money at the BBC, we asked the Executive to see if they could make further savings on top of the existing 3 percent year-on-year efficiencies, so that the BBC does not ask license fee payers to pay any more than they need to for BBC services.

"A freeze in income will not be pain-free, and this decision was not taken lightly. But the Trust is satisfied that the BBC can manage the impact while continuing to deliver the range of programs and services that the public loves."