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Corner Office from Marketplace

BBC at risk as the UK weighs TV license fee

Stephen Beard Jun 8, 2015
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Imagine a country where you have to be licensed to watch TV — and could be fined and even jailed for watching while unlicensed. Sounds Orwellian. 

But you don’t have to imagine it; the UK  requires anyone with a TV to buy an annual license, costing around $220. The total revenue raised — about $5 billion a year — is used to fund the country’s state-owned broadcasting organization, the BBC, or “the Beeb” as it’s known in Britain. 

Enforcing this charge can be messy: cases of people accused of evading the fee accounted for more than one in 10 of all criminal prosecutions in magistrates’ courts in 2013 – with 155,000 convicted and fined and 50 going to prison for failure to pay the fine.

The newly elected Conservative government has promised to decriminalize this funding system so no one will be punished by the criminal law for failing to pay the license fee;  nonpayment would be treated as a civil matter, like the nonpayment of a telephone bill. Some Brits would like to see the TV license system scrapped altogether.

An online petition to abolish the TV license fee has gained more than 158,000 signatures. The petition claims the fee gives the broadcaster an unfair advantage over its commercial rivals in terms of revenue and, because it is unrelated to the ability to pay, it is a “burden on the poor.” 

Eamonn Butler, head of the free-market Adam Smith Institute, argues that in our digital, multichannel, multiplatform age the license fee is wrong in principle and hopelessly outdated. 

“It stems from the time when the BBC was a monopoly broadcaster,” he says. “I own a television set, but I rarely watch the BBC because I have 200 other channels to choose from. So why should I be forced to pay for a network that I don’t actually look at when I’ve got so much other choice?” 

But the Beeb, which is by far Britain’s biggest news provider, has many supporters.

“It produces some astonishingly good television, some very, very good radio and its website is something I refer to several times a day,” says media consultant Ben Fenton. “So I’m a consumer of the BBC. I like the product. I’m happy to pay for it through the license fee.”

The opposition Labour Party also supports the license fee as a source of funding, at least until the corporation’s charter is renewed in 2017. Labour claims that decriminalizing the fee now would deprive the Beeb of much-needed revenue. Enforcing the fee in the civil courts would cost more than the revenue it would raise and therefore, if it’s unenforced, fewer people would pay it. 

“There’s a danger that you just smash a 200-million pound hole in the BBC’s finances,” says  Chris Bryant, Labour’s culture spokesman. “That’s the amount the BBC spends on all of its children’s broadcasting. You’ll smash that 200-million hole in the BBC’s finances without having thought how to make that up from any other source.” 

But the BBC is under the gun. One thousand British households a day are opting out of the license fee, claiming that they no longer have a TV set and get their news and entertainment over the internet. The Beeb will need to find new ways to raise its revenue.

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