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January 13, 2022updated 30 Sep 2022 10:55am

Former BBC lobby correspondent: Why corporation should ditch the licence fee

By Leon Hawthorne

Culture secretary Nadine Dorries has indicated that she is keen to scrap the BBC licence fee and find another way of funding the corporation. Here former BBC lobby correspondent Leon Hawthorne explains why he thinks she has a point.

The BBC should seize the initiative and itself propose getting rid of the licence fee. A century after coming into existence in 1922, the BBC should take charge of its own destiny and avoid being a political football, under constant attack from whoever is the present occupant of 10 Downing Street.

On Sunday, Culture Secretary, Nadine Dorries MP announced she was freezing BBC funding, and tweeted: “This licence fee announcement will be the last.” Her actions follow those of Conservative backbench MP, Peter Bone, who tabled the BBC Licence Fee (Abolition) Bill, which would make the BBC become a subscription service, like Netflix and Sky. The Private Member’s Bill is unlikely to become law; instead merely providing an opportunity for parliamentarians, who are critical of the BBC, to vent their frustrations about its alleged political bias.

These are just the latest attacks on the corporation. It will not be the last, as the BBC negotiates with the government for the renewal of the Charter to secure its status beyond 2027.

While those on the right of the Conservative Party, like Mr Bone, are motivated, in part, by political malice, there are many others who feel the licence fee is a regressive form of taxation, which is no longer fit for purpose. A compulsory poll tax of £159 on every UK household, imposed under the threat of imprisonment, is no way to run a media business in the 21st century. This is especially true as younger audiences Increasingly watch less linear TV, instead watching video clips on YouTube and TikTok.

It is just a matter of time before an alliance of the young, and the Progressive Left join forces with Conservative backbenchers to force a new funding system on the BBC. Instead of waiting for the hangman’s noose, the BBC should lean in to change, and itself propose a bold strategy for its future.

I suggest the BBC’s Director-General, Tim Davie presents government with a radical business plan to become a private corporation, responsible for its own funding, just as it was when it was founded in 1922. A blend of subscription revenue for some services, and advertising revenue for others.

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The BBC should write a prospectus for floatation on the London Stock Exchange, raising potentially billions of pounds of capital. It would be the biggest event in popular capitalism since British Gas asked us to “Tell Sid” about its privatisation in 1986.

Licence fee certificates could be converted into share certificates in order to give the public a feeling of continued ownership of the broadcaster. Instead of a compulsory licence fee, audiences could be offered different levels of paid membership of a new BBC “club”, which would provide access to customised levels, and genres, of content.

True, this is not without risk. It is easier to suck from the taxpayers’ teat than fend for oneself in a marketplace, where customers can exercise choice. But that low-risk approach comes at a price. It fosters a culture of entitlement among BBC employees, arrogance, inertia and a lack of responsiveness to audiences.

The BBC is a precious media brand, which is not able properly to compete on a global scale with the new media behemoths of Silicon Valley, precisely because of its present funding structure, and its parochial preoccupations with Westminster politics. It should rush to liberate itself from these shackles, in an attempt to guarantee success for the next one hundred years.

[Leon Hawthorne is a former BBC lobby correspondent and Chief Executive of the Baby Channel.].

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