License fee frozen for six years

The U.K. government has frozen the cost of the TV license fee that funds the BBC for six years and made changes to the pubcaster’s responsibilities that equate to a 16% cut in coin in real terms.

The annual fee, paid by every household with a TV, will be fixed at its present £145.50 ($228), giving the BBC $5.65 billion a year.

The BBC must also pay for the BBC World Service ($427 million a year); newsgathering outfit BBC Monitoring ($39 million a year); and Welsh-language web S4C ($157 million a year) from 2015. All were previously paid for by the government.

The Guardian paper reported late Tuesday that the pubcaster will also provide $236 million a year to rollout broadband to rural areas from 2013 and $39 million a year for local TV and online content. It would also make a one-off investment of $39.3 million in local TV and online services and will pay for the national rollout of digital radio.

All these undertakings will total $534 million by 2014-15.

A formal announcement of the changes to BBC funding will be made today when pols reveal plans to cut the U.K.’s $135 billion deficit.

The BBC had feared that a more severe measure was in the works. The government was mulling transferring the $874 million annual cost of free TV licenses for senior citizens, now state funded, to the pubcaster. This would have resulted in a 26% cut to the BBC’s budget.

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