Licence Fee Set For Two Year Freeze

The TV licence fee is set to be frozen in 2011, the BBC Trust has announced.
In a proposal to Government, the fee should be frozen at its current level of £145.50 for the remaining two years of the current settlement. This means taking an estimated £144m out of planned BBC budgets.
Given the exceptional pressures that the current economic climate is placing on licence fee payers, the Trust asked the Executive in June to scrutinise its budgets and assess whether short-term savings could be made.
The Executive presented its findings to the Trust earlier this month, making it clear that the loss of £144m will require some on-air changes, particularly at a time of continuing capital spend on infrastructure projects and digital switchover. Nevertheless, the Trust concluded that there are ways of making the necessary savings while keeping any on-air impact within acceptable limits.
The proposal to freeze the licence fee was made in a letter to the Secretary of State.
Sir Michael Lyons, BBC Trust Chairman said: "A freeze in income will not be pain-free, and this decision was not taken lightly. But the Trust is satisfied that the BBC can manage the impact while continuing to deliver the range of programmes and services that the public loves."
In addition, there is a BBC review under way to establish what level of long-term efficiencies can be found after 2013 – including whether new structures and working cultures could help to reduce the BBC's cost base.
The Trust will be assessing this work in the coming months.
(BMcN/KMcA)