Culture Minister Denies Government ‘Ripping Up’ BBC Funding Agreement

BBC Headquarters (Press Association via AP Images)

Culture Secretary Lucy Frazer refuted claims that the Government is undermining the BBC licence fee agreement amid reports that Prime Minister Rishi Sunak intends to halt a proposed 9% increase in the annual licence fee.

The fee, currently fixed at £159, was earlier agreed to be adjusted for inflation post-April 2024. The proposed increase would have seen the annual fee rise to £173.30. The BBC is working to counterbalance high inflation and a two-year fee freeze by cutting £500 million in costs.

Speaking on BBC Radio 4’s Today programme, Frazer emphasised the Government’s focus on the cost of living and its efforts to shield people from escalating living expenses.

“What we’re looking at is the appropriate rate of inflation,” she said, indicating that a decision on the fee hike is imminent. “And we’re considering that with an eye on the fact that we want to ensure that people continue to be able to afford their bills.”

Sunak, speaking after the Cop28 climate summit, said that the BBC need to be “realistic about what it can expect people to pay at a time like this.”

The BBC has already initiated cost-saving measures, including reducing Newsnight to a 30-minute program and relocating BBC News At One to Salford. These changes are part of a broader strategy to save £7.5 million, focusing more on digital storytelling and live coverage.

A BBC spokesperson reiterated the agreement reached with the Government in January 2022, under former Prime Minister Boris Johnson, which included a two-year freeze on the licence fee and subsequent inflation-based increases from 2024.

In her comments, Frazer assured listeners that the government is not “ripping up” the existing deal but is considering the rate of inflation with an eye on the public’s ability to afford bills. The BBC, guaranteed funding until at least the end of 2027 by its royal charter, awaits a firm decision, which is expected to be made “very soon.”

The spokesperson affirmed the BBC’s commitment to delivering quality content and value for its audience, despite the fee’s status for 2024/25 remaining undecided.