BBC proposals for 2007/2008 to 2013/2014 licence fee

BBC presentation (24 slides, PDF) setting out its proposals for a licence fee settlement of RPI + 2.3 per cent per year for the period 2007/2008 to 2013/2014. The BBC reports that it is the first time it has made its licence fee case openly.

The BBC explains how the Government's vision in the Charter Review green paper (PDF, 118 pages) requires additional resources in various categories. For instance, the BBC predicts that the need for additional digital infrastructure will cost an extra £0.7bn over the five-year period to 2013/2014. Similarly, £1.4bn is needed to increase quality, which the BBC illustrates by comparing the costs of repeats to the costs of drama originations. The BBC then sets out some offsetting factors, such as efficiency savings (£2.6bn), that mean that the BBC's net additional funding requirement is RPI + 1.8 per cent. Somewhat strangely, the BBC includes under the heading "self help" the expected increase to licence fee income resulting from growth in the number of households (£0.7bn). The need for RPI + 2.3 per cent seems to come from combining these numbers with some additional industry costs and other digital switchover costs that the BBC "may have to meet".

See also BBC "supporting information" report (148 pages, 4.9M PDF).

Filed under BBC, DCMS, Media.

Reckon LLP is an economics consultancy with expertise in data analysis, economic regulation and competition law.

About Reckon