The culture secretary, Nadine Dorries, has confirmed that the BBC’s funding will be frozen for the next two years – but has softened her stance on the permanent abolition of the television licence fee.
The annual levy on television usage will remain at £159 until April 2024, requiring cuts to the BBC’s output. However, it will then rise in line with inflation for the next four years – a better deal than had been proposed in some press briefings from the government.
Dorries also watered down her own suggestion that the licence fee would be abolished from 2028 onwards, raising suspicions that the focus of her provocative intervention on Sunday was to distract from Boris Johnson’s woes.
On Sunday Dorries tweeted that the current licence fee settlement “will be the last” and the “days of the elderly being threatened with prison sentences and bailiffs knocking on doors are over”.
Yet when formally announcing the BBC funding settlement in parliament on Monday afternoon, her language was notably softer. She insisted that no final decision had been made on the future of the licence fee: “It is not a policy – we are announcing a debate and a discussion. The decision as to what the future funding model looks like is up for discussion.”
The BBC said rising inflation meant that freezing its main source of income for two years “will necessitate tougher choices which will impact licence fee payers”. Some services may have to be closed to make hundreds of millions of pounds in savings.
Richard Sharp, the chair of the BBC, suggested the broadcaster had been blindsided by the government’s decision to brief the licence fee deal to Sunday newspapers.
“I hadn’t anticipated learning what I learned over the weekend,” he told BBC Radio 4’s PM programme. “I had a meeting with the secretary of state last week. We were expecting to have further discussions and come to a conclusion this week.”
Dorries told parliament that the BBC was a “beacon” of British culture that needed to survive, but there should be a debate about how it should be funded in the future.
She said she could not envisage a world where households in 2028 were still paying a fee based on ownership of a television, but did not have any preference as to what funding model could replace the licence fee. Dorries repeatedly emphasised that she was unlikely to be in her current job when the decision was made: “We haven’t even begun the discussions yet … There are a number of ways I have been told already that we could fund the BBC going forward. It’s not for me to decide until we have all the information and all the evidence.”
She also criticised some aspects of the BBC’s output, saying there should be further investigations into the BBC’s “impartiality and groupthink”.
Dorries’ suggestion that freezing the licence fee would help with the cost of living was welcomed by some Tory MPs in so-called red wall seats. However, she also had to contend with several backbench Conservative MPs who spoke up in defence of the BBC – suggesting the politics of cutting the national broadcaster’s budget are not clear cut.
The veteran Tory Sir Peter Bottomley, the longest-serving MP in parliament, said he was not impressed by the announcement and questioned why the licence fee was the “one thing” that could not be increased in line with inflation by the government.
In a joint statement, Sharp and the BBC director general, Tim Davie, said it was disappointing that the funding freeze for the next two years meant the BBC would now have to absorb rising costs, particularly with inflation running at more than 5%. They said they would set out where budget cuts would fall in the coming months.
The licence fee is also used to fund Welsh language channel S4C, which will receive an extra £7.5m to boost its online offering as part of the deal.
The House of Commons Speaker, Lindsay Hoyle, earlier reprimanded Dorries for tweeting out the licence fee announcement rather than announcing it in parliament. He suggested there was a “major colander right across government” and that there might need to be a leak inquiry to find out who briefed her policy to Sunday newspapers.
Dorries apologised and said she had “refused every invitation for media yesterday and today”.
The Labour MP Catherine McKinnell later asked if Dorries was “seeking to undermine and sacrifice this great national institution in order to save the prime minister’s political skin”. Dorries replied: “I’m not.”
