6 Jul 2015

BBC’s new benefits responsibility confirmed

The Culture Secretary John Whittingdale has confirmed the Sunday Times story that the government is handing over responsibility for the free licence fees for the over-75s policy to the BBC.

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It is protected as per campaign pledges for this parliament but after that it is in the BBC’s hands. Government sources dismissed my suggestion they might hand over responsibility for winter fuel payments to energy companies at some point in the future as well.

The cost for the BBC will start at £250m in 2018/19 and then is expected to increase to £450m the following year, and £750m by 2020/21. In return, the BBC gets to increase the licence fee in line with inflation and start charging for some I-player services.

The culture secretary was asked by the SNP’s John Nicolson if he would support the BBC trying to means test the over-75s’ benefit in future, a reminder of the complications of out-sourcing a benefit to an outside body. The Culture Secretary didn’t really engage with the premise.

This is not a major off-load of government welfare cost in the short term as it will be phased in later in the parliament. But it is a giant piece of messaging. For Tories who portray the BBC as hostile to cuts, here’s an opportunity, some of the chancellor’s allies say, for the BBC to see how it likes coming face to face with tricky welfare choices. And it’s a very significant cost saving in the medium to long term as the demographics send the bill upwards.

The culture secretary praised the BBC for embracing the new policy but the first the BBC seems to have heard about it was when the chancellor made direct contact with the BBC director general last week.

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4 reader comments

  1. Alan says:

    Does it not strike you as odd that a corporation (private entity) is allowed to levy a tax? Wasn’t that an issue of the civil war? One can only conclude that the BBC isn’t as impartial as it and others claim.

  2. Philip Edwards says:

    Gary,

    “…tricky welfare choices.”

    Yeah, right.

    Nothing tricky for the Bullingdon Gang. All they do is steal from what’s left of our pooled national wealth and give it to themselves and their chums.

    They run a capitalist state of theft-from-the-cradle-to-the-grave. Just like the Victorians. Government by Gradgrind and Bounderby.

    One of the purposes is to get advertising onto the Beeb.

    Just hang on. The next depression and “austerity” will be along soon enough. Unless, of course, they get us into yet another war and its diversionary televised spectacle via Murdoch subscription……..all of it underpinned by neocon bureaucracies in Westminster, Whitehall and Canary Wharf.

  3. Gerry says:

    The responsibility for TV licensing is being transferred to the BBC licence fee payers not the BBC. Clearly this is an example of devolving a welfare policy, normally funded out of general taxation, back onto licence fee payers…many of whom have already paid for this policy through general taxation.

    So BBC licence fee payers end up paying this tax out of income that has already been taxed…effectively imposing a new tax on the licence fee payer. The chancellor and his buddies has nothing to learn.

  4. Robert says:

    People talk as if the BBC has its own money. In fact the cost of free licence fees for the over-75s is being transferred onto everyone who pays the TV licence.

    It’s a 20% cut in what they get for their £145.50. It means 20% less programming for the same money.

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