BBC makes a case for new licence fee settlement

MUMBAI: UK pubcaster the BBC has unveiled its case for a new licence fee settlement to ensure that it continues to deliver value to licence payers as they move towards a fully digital Britain. The BBC states that its vision, endorsed by the Government's Green Paper earlier this year, is for high quality original content and services that will be universally available to everyone, irrespective of age or income.

The beeb notes that with digital switchover, all licence payers will be able to access all BBC output, wherever they live in the UK thanks to the commitment to build a universal digital infrastructure for TV and radio. Content and services will be received on normal television and radio sets, but also on mobile devices and via broadband, with all public service content available for free for up to seven days after first transmission.

The BBC has proposed a licence fee increase from April 2007 based on Retail Prices Index (RPI) plus 2.3 per cent a year. In today's prices, this means €219.21 a year per household by 2013, compared to the current €183.55. That amounts to an average annual €4.57 increase per household, excluding RPI, from the start of the next Charter, while the licence fee is still declining steadily as a proportion of disposable income.

It does not include the costs of targetted help for special groups when the analogue signal is switched off. The funding decision will be taken by the Government next year as part of the process around the BBC's new Royal Charter starting in 2007. However, the BBC will meet more than 70 per cent of this itself, not from additional licence fee funds.

Self-help measures are already underway at the BBC, including job losses, rationalising processes and commercial disposals and dividends, will contribute €5.7 billion, leaving a funding gap of €2.3bn which could be closed by an RPI +1.8 per cent settlement. The BBC states that it will also be opening up its archive, built over many years from the public's licence fee payments, and will invest in High Definition TV to ensure it is available to all and not confined to subscription services. New technology it says will also allow it to deliver state-of-the-art local television services and radio stations, as well as investing in production and a presence around the UK, representing the country more effectively than in the past.

It is the first time the BBC has made its case for a new licence fee settlement so openly and it follows public consultation and scrutiny by the BBC Governors and their independent advisors, as well as public response to the Government's Green Paper proposals.

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