Equity alarm over BBC licence fee deal

Published Thursday 18 January 2007 at 12:10 by Liz Thomas

Equity has voiced its concern about the below inflation licence fee settlement for the BBC, to be confirmed by the government later today.

The union said the deal, which will see the Corporation receive a 3% rise in the levy for the next two years, followed by increases of 2% for the following three years and between 0% and 2% in 2012-13, had rung alarm bells.

This is the first time the licence fee has not been tied to the inflation rate. The figures are some way short of the RPI +1.8% the BBC had originally requested for it to be able to fulfil its public service remit in the long term.

Equity general secretary Christine Payne commented: “Equity is concerned about the impact of a below inflation increase on the ability of the BBC to continue to make world class drama and entertainment. The BBC is a British success story which could be so easily damaged by underfunding.

“Our concerns are compounded by the ring-fencing of £600 million to help viewers move to digital. While the aim is both praiseworthy and necessary, there should have been an additional budget given to the BBC for this work. Taking the £600 million out of the BBC’s operating budget runs the risk of further damaging its programme-making abilities.”

The union also criticised the move by the treasury to curb the amount that the BBC is able to borrow from around £400 million to closer to £230 million, adding that the figure was less than half the amount considered normal for a private company of a similar size.