The BBC will have no choice but to slash services as the licence fee freeze leaves it desperately out of pocket, boss Tim Davie has said.
Insiders warned “nothing is off the table” as bosses plan how to make ends meet after the levy is frozen this spring.
TV channels and radio stations under threat include BBC2, CBeebies, Radio 5 Live and BBC News.
Director-General Mr Davie said that by 2027 the estimated annual shortfall would stand at £285million – more than the total yearly budget of BBC2, which was £261million last year.
He told Radio 4’s Today programme: “Inevitably, if you don’t have £285m, you will get less services and programmes.”
He said the corporation will have to look at what to cut, admitting: “Everything is on the agenda.”
From April, instead of the licence fee rising with inflation to £167, it will stay at £159 for this year and next. It will then rise with inflation again from 2024 until 2027, when the current royal charter expires.
But that will still leave it short as those future increases will be made from the starting point of this year’s frozen figure. The cost to the BBC in the next six years will be about £1.5billion, insiders predicted yesterday.
It means some services face the chop before Culture Secretary Nadine Dorries even gets going on the Tories’ plans to replace the licence fee with a different funding formula from 2027.
The BBC is expected to outline how it intends to bridge the funding gap, with whole services being considered.
One source said: “Nothing is off the table and nothing is being ruled out. You can’t salami-slice your way out of this.”
Radio stations will come under scrutiny, with Radio 4 the most expensive in 2021, costing £84m to run. Radio 2 cost £47m, Radio 5 Live £44m and Radio 1 has a budget of £36m. BBC 6 Music cost £12m and the Asian Network £7m.
Many of those who resent paying a licence fee cite the pay of stars such as Gary Lineker and Zoe Ball as an example of the BBC squandering cash.
But insiders argue the on-air talent has to be paid a competitive rate, adding: “Do the public really want a middle manager from Surrey on £40,000 reading the news or presenting Strictly Come Dancing? I don’t think so. BBC research consistently shows the audience expects and want us to have big stars. And the truth is, you have to pay them.
“Almost all on-air talent have taken cuts, some of them considerable ones.”
TV budgets have already been significantly cut from where they were a decade ago.
Last year BBC1 had a budget of £924m, down from £1.13bn 10 years earlier in 2011. BBC2’s £261m was down from £404m in 2011.
CBBC had £58m, down from £82m, while CBeebies was down to £25m from £29m and BBC4 £29m from £50m.
The £1bn savings, imposed in 2015 by then-Chancellor George Osborne, slim-lined the operation to such an extent that further cuts have to come from content, rather than from staffing or operational changes, a National Audit Office report confirmed last month.
It has already led to a rise in repeats, the NAO said, with a 21% rise across the three main BBC channels in 2021.
Now the Beeb could have to replace expensive dramas and natural history shows with cheaper programmes, the report concluded.
The cost of making shows such as Line of Duty and David Attenborough’s nature series have soared, due to both the pandemic and competition on studio space from Netflix and Amazon driving prices up.
There is also likely to be less sports coverage – the BBC has already dropped Formula One and reduced the number of Six Nations rugby matches covered.
As plans are made for new ways to fund the BBC, the corporation will campaign to keep the universal licence fee, which they say brings the best value for money.
One staffer said: “If the BBC is to continue being the envy of the world, it’s the only way. We can always reform, modernise and do things better but most people think 43p a day, per household, is well worth it.”
Do you have a story to sell? Get in touch with us at webcelebs@trinitymirror.com or call us direct 0207 29 33033.
