TV licence fee to rise to £170 a year from April – Your Money
The UK TV licence fee will increase by 88p per month starting in April, bringing the annual cost to £170. The decision comes after the government announced changes to how the inflation-linked adjustments to the licence fee are calculated for 2024. The new methodology aims to address the ongoing cost-of-living pressures faced by families.
In January 2022, the government initially froze the licence fee for two years, agreeing to keep the annual fee at £159 until April 2024. Afterward, it would rise with inflation for the following four years. However, reports surfaced earlier this week that the government was considering using the lower Consumer Prices Index (CPI) rate from September, rather than the higher 12-month average, to calculate the fee increase.
The Department for Culture, Media and Sport (DCMS) has now confirmed that, under the new methodology, the September 2023 CPI figure of 6.7% will be used instead of the annualised October to September CPI figure of 9%. This means that the annual licence fee is £20 less than originally expected, resulting in households saving £37 since 2022.
The change in the CPI rate also affects the black and white TV licence fee, which will increase from £53.50 to £57.
In addition, the culture secretary Lucy Frazer has announced a review into how the BBC should be funded in the future. The review will explore alternative models that can ensure the broadcaster’s long-term sustainability amid a rapidly evolving media landscape, increased competition, and changing audience behavior, while also reducing the burden on licence fee payers.
Frazer emphasized the importance of a fair deal for the licence fee payer and the need to support the BBC in producing world-leading content. She acknowledged the financial strains faced by families and highlighted the government’s efforts to reduce the increase to less than £1 per month, following two years of licence fee freezes.
With a declining number of people paying the licence fee, questions about the sustainability of the current fee system have been raised. The funding review of the BBC aims to examine the licence fee and assess whether a reformed funding model could better support the national broadcaster’s sustainability and affordability for audiences, while also fostering growth in the creative industries.
While the increase in the licence fee may be unwelcome news for many, it is important to note that other entertainment platforms are also raising prices. For example, Disney+ subscribers in the UK will face a significant 38% increase this month, resulting in a collective rise of up to £274 million per year. Amazon Prime members paying monthly will experience a price hike of £156 million, while Apple TV+ users will see an increase of £53 million.
There are ways to avoid the TV licence fee increase, particularly for those who primarily watch on-demand channels using their broadband connection. Only the BBC requires payment, while other services like Channel 4 On Demand and ITVX allow for free streaming, albeit with advertisements. It is essential to inform TV Licensing if you do not require a licence to avoid potential inspections.
Lastly, it is crucial to remember that individuals over the age of 75 are entitled to receive their TV licence for free. Unfortunately, many pensioners may not be aware of this benefit, and TV can serve as a lifeline for elderly individuals, especially during the cold winter months.
The increase in the TV licence fee and the ongoing funding review will shape the future of the BBC and its ability to fulfill its role as a leading broadcaster. The government’s aim is to strike a balance between supporting the licence fee payer and ensuring the BBC’s sustainability in delivering informative, educational, and entertaining content for decades to come.
