Ministers look again at ads-on-BBC proposals

Government ministers are distancing themselves from recommendations for a pounds 24 top-up fee for digital subscribers in order to finance the BBC’s digital channels, and looking at allowing the BBC to run advertising as an alternative method of new funding.

Government ministers are distancing themselves from recommendations

for a pounds 24 top-up fee for digital subscribers in order to finance

the BBC’s digital channels, and looking at allowing the BBC to run

advertising as an alternative method of new funding.



Officials at Downing Street and the Treasury are keen to revive the

long-running debate over advertising on the BBC - a proposal considered

and rejected when Margaret Thatcher was in power, but one which Labour

has always opposed. One idea would be to allow the BBC to run

advertising just on its digital channels.



Advisers believe the introduction of advertising on some channels would

be politically more acceptable than the other alternative to the digital

levy proposed by the Davies Committee - a smaller rise in the pounds

101-a-year licence fee.



But the Cabinet is split over the issue and both Chris Smith, the

culture secretary, and Janet Anderson, the broadcasting minister, oppose

the idea of advertising on the BBC. They share the view of the

corporation’s bosses that ads could jeopardise its public service

remit.



A Government source said: ’If we do not opt for a digital fee, we will

have to consider the other options, including advertising, sponsorship

and subscription.’



Although ministers were initially keen on the Davies plan, they are

nervous about the hostile reaction, particularly from commercial

broadcasters.



Stephen Byers, the trade and industry secretary, has backed their claim

that a top-up fee could reduce the take-up of digital.



Government ministers are worried that it would be unfair to raise the

licence fee for all viewers - including those who do not opt for digital

channels. Smith has called in the consultants, Pannell Kerr Forster, to

report on the BBC’s finances by the end of next month. He will announce

his decision on the Davies plan in January.



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