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11/10/2006
BBC Licence Fee under review
The BBC has confirmed that it has reduced its bid for a hike in the licence fee from 2.3 % to 1.8 % over inflation.
The BBC said it needed an inflation plus 2.3 % to fund a list of expenditures, including the move of 1,800 staff to Manchester, the expansion of interactive services and the promised financial aid to help vulnerable groups switch from analogue to digital TV.
An analysis of the corporation's opening bid by accountants PKF for the Department for Culture, Media and Sport questioned the figures on which the BBC had based its initial bid.
Director General Mark Thompson speaking about digital switchover at the Smith Institute in London on Wednesday commented: "This is a project of great size and intimacy. The risks are formidable. If it is under-resourced it will fail. It's as simple as that - and the failure will impact on many millions of households.
"If you want a BBC which does no more than it is currently doing, then a budget that reduces in real terms - RPI-minus - is the right settlement."
A tough regime of productivity and cost reduction within the BBC over recent years will release an additional £355 million per year for new investment from 2008 - a total of £3 billion over the next charter.
Creative industries minister, Shaun Woodward, is reported as saying the government is still negotiating with the BBC over the size of the licence fee settlement and will not be rushed into deciding a figure.
The revised bid would put the licence fee at around £149 in 2013/14 at today's prices.
The next BBC Charter comes into effect next year and is under review by the government.
(DS/SP)
The BBC said it needed an inflation plus 2.3 % to fund a list of expenditures, including the move of 1,800 staff to Manchester, the expansion of interactive services and the promised financial aid to help vulnerable groups switch from analogue to digital TV.
An analysis of the corporation's opening bid by accountants PKF for the Department for Culture, Media and Sport questioned the figures on which the BBC had based its initial bid.
Director General Mark Thompson speaking about digital switchover at the Smith Institute in London on Wednesday commented: "This is a project of great size and intimacy. The risks are formidable. If it is under-resourced it will fail. It's as simple as that - and the failure will impact on many millions of households.
"If you want a BBC which does no more than it is currently doing, then a budget that reduces in real terms - RPI-minus - is the right settlement."
A tough regime of productivity and cost reduction within the BBC over recent years will release an additional £355 million per year for new investment from 2008 - a total of £3 billion over the next charter.
Creative industries minister, Shaun Woodward, is reported as saying the government is still negotiating with the BBC over the size of the licence fee settlement and will not be rushed into deciding a figure.
The revised bid would put the licence fee at around £149 in 2013/14 at today's prices.
The next BBC Charter comes into effect next year and is under review by the government.
(DS/SP)
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