Is a broadcasting levy a good replacement for the licence fee?

MPs are gunning for the BBC licence fee, but is the proposed broadcast levy a realistic alternative, Gurjit Degun asks.

Proposals made last week by a group of MPs that the BBC should abolish the licence fee in favour of a broadcasting levy on households is the latest move to change the way the BBC is funded. The report from the Culture, Media and Sport Committee found that the licence fee is "anachronistic and out of proportion".

The committee said that introducing a levy, similar to the one used in Germany, would eliminate the time and effort currently spent on looking for licence-fee evaders. The MPs also believed it would ensure those using radio and online services contribute to the costs.

The report added that a degree of subscription for BBC services could be a possibility in the future. It also said that the levy would allow for a small proportion of the revenue raised to be used to fund public-service content and services, such as children’s broadcasting and local journalism, provided by other media companies.

The licence fee is applicable for households in the UK that watch or record TV programmes. The fee, which was introduced in 1946, is currently frozen at the 2010 level of £145.50 until 31 March 2017. A black-and-white TV licence is £49.

Opinion is definitely mounting that the licence fee is outdated, but there are real concerns that introducing a levy could penalise the proportion of the public who does not tune into BBC services. More than one million people who claim not to watch BBC content could be forced to pay to fund it.

The National Union of Journalists was among those to say the licence fee is the fairest way of funding the BBC and it needs to be increased. Paul Bainsfair, the director-general of the IPA, added: "It would take a brave politician to tinker with the BBC."

Warren Johnson, the founder of the PR company W, captured the fears of the doubters, saying the move was just another way of selling bundled content in the name of public service. He said the BBC’s core public-service content should always be free, ensuring news and education programming is available to all. However, he is among those who believe a tiered licence fee for further content bundles could make sense.

YES Bob Wootton, Director Of Media And Advertising, ISBA "A universal tax based on the assumption that every household consumes the BBC’s output is no longer tenable. However, the technology to tell us who is using and who should pay is not yet widespread and won’t be for a while."

YES Siobhan Kenny, Chief Executive, RadioCentre "I don’t see how a subscription or ad-funded model would work for BBC Radio, but a broadcasting levy could ensure everyone contributes and reaps the benefits without the issue of identifying how people access BBC services."

NO Mark Lund, UK Chief Executive, McCann Worldgroup "The idea of a levy feels like an idea that belongs to a previous era. The BBC Trust may not be fit for purpose, but Ofcom regulates other broadcasting without apparent problem – so why not put the BBC under its remit?"

NO Jess Burley, Chief Executive, M/SIX "A levy is unfair to consumers who don’t watch BBC content. It also seems unfair on other media owners that have had to find equitable models to fund the content they produce, whether via advertising, subscription or some other route."