The BBC license fee will be frozen for the next two years by the UK government before returning to an inflationary rise, which will likely cripple the corporation’s programming budgets.
Culture Secretary Nadine Dorries confirmed the speculation from the weekend to the UK’s Houses of Parliament and also stated a review into the entire funding model will begin shortly, existentially threatening the future of the corporation.
Amidst rising inflation and soaring programming costs, the fee will remain at £159.50 ( $217.70) for the next two years before returning to an inflationary rise.
A swift BBC statement from Director General Tim Davie and Chair Richard Sharp called the settlement “disappointing” for both the BBC and cultural industries and said the corporation will now have to “absorb inflation.”
The BBC has previously stressed that it will be required to make savings of around $2BN over the next two years if the fee is frozen and, as recently as this morning, a spokesman said “anything less than inflation would put unacceptable pressure on the BBC finances after years of cuts.”
Dorries said that the settlement is a “fair one” for the BBC, which still makes around £3.5BN ($4.8BN) per year from the license fee, while commercial arm BBC Studios has had its government borrowing limit doubled to £700M ($955M).
Facing accusations that the government is ideologically opposed to the BBC, she stressed that the decision has been made to protect families’ rising costs of living, which are soon to worsen as inflation sets in and with energy price rises looming
“The BBC wanted the fee to rise to £180 ($245.70 ) per year by the end of this settlement,” said Dorries. “Freezing the fee means more money in the pockets of pensioners and families who are struggling to make ends meet.”
A review will soon get underway into the license fee more generally, a “discussion of what the BBC will look like in 2027,” added Dorries.
Following Dorries teasing this news yesterday on Twitter, multiple big players from the UK entertainment world such as Hugh Grant, Armando Iannucci and Lucy Prebble slammed the government for attacking the BBC for political reasons.
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