BBC director general Tony Hall insisted that the broadcaster had achieved “the right deal” yesterday, after it was confirmed that the broadcaster would start paying the licence fee for Brits over 75 from 2018.
However, Rona Fairhead, the chairman of the BBC Trust, which represents licence fee payers, appeared to be less happy about the package.
In a letter to chancellor George Osborne, and culture, media, and sport secretary John Whittingdale, Fairhead accepted the deal, but appeared to warn the new Tory government not to squeeze the public service broadcaster further.
Fairhead wrote: “We accept this decision is a legitimate one for the Government to take, although we cannot endorse the process by which it has been reached.”
The BBC will begin paying for concessionary licence fees from 2018, This will be phased in, with the broadcaster taking on 100 per cent of the burden by 2021.
The rate of the licence fee will also rise in line with the consumer prices index (CPI), the lower rate of inflation, from 2017.
A BBC source told City A.M. that the decision was a “strong deal for the BBC in tough circumstances.”
Labour’s shadow culture secretary Chris Bryant hit out at the government’s approach, calling today’s announcement “a shabby deal”, that should have been done publicly through the upcoming charter review.
Bryant told City A.M: “The Conservatives put a gun to the BBC’s head, and the BBC said ‘oh alright then shoot me in the leg instead of the head’.”
The deal, announced in response to an urgent question in the House of Commons by Bryant, will also mean that the licence fee will have to be paid by those who use the BBC iPlayer solely as an on demand service.
Over the weekend, Osborne said the BBC had become “imperial in its ambitions” for its website.
The BBC last week had to announce 1,000 job cuts to save £150m.